Tesla Motors Inc., the startup electric car-maker that received $465 million in U.S. Energy Department loans, must come up with a speedier repayment schedule after getting a waiver on existing terms.
Tesla, which sells two models of plug-in cars, has yet to turn a profit.
The Palo Alto, California-based company, led by billionaire Elon Musk, said yesterday in a U.S. regulatory filing that it has until Oct. 31 to submit a proposal for "early repayment" of loan principal to the Energy Department.
Tesla said it received a waiver Sept. 24 from a requirement in the previous loan agreement to maintain a specified current ratio of assets to liabilities, which measures a company's ability to repay its debts in the next 12 months.
The department worked with Tesla on a minor technical change to the loan agreement that includes the company submitting a plan to accelerate repayment of the loan," Damien LaVera, an Energy Department spokesman, said in an e-mail yesterday. "Tesla has made loan payments on time and in full."
Tesla will meet the deadline for the revised payment plan and will be able to pay back loans in less than the existing 10- year term if it becomes profitable ahead of schedule, said Deepak Ahuja, the company's chief financial officer.
"They would like to explore possibilities that would result in a repayment earlier than 10 years, when we are in a financially sound situation and have access to multiple capital- markets alternatives," Ahuja said in a phone interview.
"It's not time-bound," he said. "It's more of metrics- based approach. That's what makes sense for the DOE and us. DOE obviously will not do anything to force us to pay while in the process injuring us."
Tesla disclosed the loan amendment yesterday as it cut its revenue outlook for the third quarter because of supplier shortcomings and other delays in accelerating production of its second vehicle, the Model S sedan.
The company said it expects to generate $44 million to $46 million in third-quarter sales, compared with the $83.1 million average of 12 analyst estimates compiled by Bloomberg. It forecast full-year revenue of $400 million to $440 million, down from $560 million to $600 million.
Tesla has said it will begin repaying loan principal in December, as required under the lending agreement. Its repayment schedule for interest on the loan began in February, according to yesterday's filing.
The company, which went public the month after receiving its loan, said in yesterday's filing it needs to raise additional capital to avoid having to seek another amendment to the lending terms.
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