Eighth Supplemental Agreement
On July 20, 2022, Canoo Inc. (the “Company”) entered into a Pre-Paid Advance Agreement (as amended and supplemented from time to time, the “PPA”) with YA II PN, Ltd. (“Yorkville”). In accordance with the terms of the PPA, the Company may request advances of up to $50,000,000 in cash (the “Maximum Advance Amount”) from Yorkville (or such greater amount that the parties may mutually agree).
On March 12, 2024 (the “Effective Date”), the Company entered into an eighth Supplemental Agreement (the “Eighth Supplemental Agreement”) with Yorkville to the PPA. Pursuant to the Eighth Supplemental Agreement, Yorkville agreed to advance $62,032,000 to the Company (the “Eighth Supplemental Advance”) and waive certain terms (including waiver of the Maximum Advance Amount) and conditions set forth in the PPA with respect to such Supplemental Advance.
The Eighth Supplemental Agreement provides that with respect to the Eighth Supplemental Advance, the Purchase Price (as such term is used in the PPA) will be equal to $2.30 per share.
As of the Effective Date, $32,000,000 in principal amount and $47,123 of accrued and unpaid interest remained outstanding under all prior pre-paid advances pursuant to the PPA (such amounts, collectively, the “Outstanding Pre-Paid Advances Amount”). Pursuant to the Eighth Supplemental Agreement, the Company used a portion of the proceeds from the Eighth Supplemental Advance to repay all of the Outstanding Pre-Paid Advances Amount plus the Redemption Premium (as such term is used in the PPA) applicable to such repayment. After giving effect to the commitment fee, legal diligence fee and the purchase price discount provided for in the PPA, as well as the repayment of the Outstanding Pre-Paid Advances Amount and the applicable Redemption Premium, net proceeds of the Eighth Supplemental Advance to the Company will be $15,000,000.
The foregoing description of the Eighth Supplemental Agreement is qualified in its entirety by reference to the Eighth Supplemental Agreement, which is filed hereto as Exhibit 10.1 and which is incorporated herein by reference.
Warrant Cancellation and Exchange Agreement
On the Effective Date, the Company and Yorkville entered into a Warrant Cancellation and Exchange Agreement (the “WC&E Agreement”). Pursuant to the WC&E Agreement, on the Effective Date, Yorkville surrendered to the Company and the Company cancelled the outstanding warrants issued pursuant to the Warrant Cancellation and Exchange Agreement, dated January 31, 2024, between the Company and Yorkville (collectively, the “Outstanding Warrants”), which Outstanding Warrants represented the right to purchase an aggregate of 10,351,032 shares of the Company’s common stock, par value $0.0001 per share (“Common Stock”), and in exchange, the Company issued to Yorkville (i) a warrant to purchase 10,351,032 shares of Common Stock at an exercise price of $1.37, exercisable beginning on September 12, 2024 and with an expiration date of March 13, 2029 (the “First Warrant”) and (ii) a warrant to purchase 10,948,905 shares of Common Stock at an exercise price of $1.37, exercisable beginning on September 12, 2024 and with an expiration date of March 13, 2029 (the “Second Warrant” and together with the First Warrant, collectively, the “New Warrants”). The New Warrants include customary adjustment provisions for stock splits, combinations and similar events.
