Canoo Inc. (GOEV) Enters $15M Pre-Paid Advance Agreement

On June 13, 2024 Canoo Inc. (NASDAQ: GOEV) entered into a Pre-Paid Advance Agreement (the “PPA”) with YA II PN, Ltd., a Cayman Islands exempt limited partnership (“Yorkville”). In accordance with the terms of the PPA, on the Effective Date, Yorkville agreed to advance $15,000,000 to the Company (the “Pre-Paid Advance”).

The Pre-Paid Advance will be offset upon the issuance of shares of the Company’s common stock (“Common Stock”) to Yorkville at an initial Purchase Price (as such term is used in the PPA) equal to $2.30 per share.

On the date that is the (i) 60th day after the Effective Date, the Purchase Price on any remaining amount of the Pre-Paid Advance then outstanding at such time will be repriced to a price per share equal to 100% of the average of the daily VWAPs (as such term is used in the PPA) for the ten Trading Days (as such term is used in the PPA) immediately prior to the date that is the 60th day after the Effective Date and (ii) 120th day after the Effective Date, the Purchase Price on any remaining amount of the Pre-Paid Advance then outstanding at such time will be repriced to a price per share equal to 100% of the average of the daily VWAPs for the ten Trading Days immediately prior to the date that is the 120th day after the Effective Date, in each case, subject to certain equity conditions set forth in the PPA.

After giving effect to the commitment fee and the purchase price discount provided for in the PPA, net proceeds of the Pre-Paid Advance to the Company will be approximately $14,100,000. The issuance of Common Stock under the PPA is subject to certain limitations, including, among others, that the aggregate number of shares of Common Stock issued pursuant to the PPA cannot exceed 19.99% of the Company’s outstanding Common Stock as of the Effective Date (the “Exchange Cap”) unless the Company’s stockholders have approved issuances in excess of the Exchange Cap. Pursuant to the terms of the PPA, interest accrues on the outstanding balance of the Pre-Paid Advance at an annual rate equal to 5%, subject to an increase to 15% upon events of default described in the PPA. The Company has also agreed to file one or more registration statements with the Securities and Exchange Commission to register the resale by Yorkville of the shares to be issued pursuant to the PPA under the Securities Act of 1933, as amended (the “Securities Act”).

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