On April 3, 2026, Flux Power Holdings, Inc. filed an 8-K report detailing a significant financial issue. The company disclosed that it failed to meet the minimum EBITDA financial covenant for the three-month period ending March 31, 2026, as stipulated in its Loan and Security Agreement with Gibraltar Business Capital, LLC (GBC). This failure constitutes an 'Event of Default' under the terms of the Loan Agreement. As a result, the company is currently engaged in negotiations with GBC to amend the Loan Agreement or secure a waiver. While GBC has permitted Flux Power to continue accessing its line of credit during these negotiations, there is no guarantee that the company will be able to secure favorable terms or maintain access to the credit line. The outstanding balance under the Loan Agreement as of March 31, 2026, was approximately $6.5 million. This situation raises concerns about the company's liquidity and operational execution moving forward, as the potential for immediate repayment obligations could strain its financial resources.

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