Subsequent Events |
12 Months Ended |
|---|---|
Dec. 31, 2022 | |
| Subsequent Events [Abstract] | |
| Subsequent events | Subsequent events Registered Direct Offering & Placement Agency Agreement
On February 5, 2023, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with certain investors (collectively, the “Purchasers”). The Purchase Agreement provides for the sale and issuance by the Company of 50.0 million shares (the “Shares”) of the Company’s Common Stock, together with warrants to purchase up to 50.0 million shares of Common Stock (the “Investor Warrants”) at a combined purchase price of $1.05 per share and accompanying warrants. The Investor Warrants will have an exercise price of $1.30 per share, will be initially exercisable beginning six months following the date of issuance (the “Initial Exercise Date”) and will expire five years from the Initial Exercise Date. The transaction closed February 7, 2023, subject to customary closing conditions.
Partial Exercise of YA PPA Option
The fourth PPA and warrants issued to Yorkville as of December 31, 2022, as discussed in Notes 9 and 16, respectively, included an option to increase the investment by an additional $8.5 million through January 31, 2023, with the same terms as applicable under the fourth PPA agreement. On January 13, 2023, Yorkville partially exercised their option, and increased their investment amount by $5.3 million, which resulted in net proceeds of $5.0 million, and was applied to the fourth PPA. As a result of the partial exercise, the Company issued a warrant to purchase common Stock to Yorkville for a total number of 34,230,870 shares, which includes the 29,604,783 warrant shares issued on December 31, 2022 and the additional 4,626,087 warrant shares issued January 13, 2023. These warrants are issued under that same terms as the initial investment under the fourth PPA, including a warrant exercise price of $1.15 per share. No additional investments were exercised under the option prior to January 31, 2023. The warrants expire on December 31, 2023. As of February 9, 2023, the exercise price of the warrants had been adjusted to $1.05 per share.
Authorized Shares Amendment
On January 24, 2023, the Company held a special meeting of stockholders (the "Special Meeting"). At the Special Meeting, the Company’s stockholders approved an amendment to Paragraph A of Article IV of the Company’s Second Amended and Restated Certificate of Incorporation to increase the Company’s number of shares of authorized common
stock, par value $0.0001 per share, from 500,000,000 shares to 1,000,000,000 shares and the corresponding increase in the total number of authorized share of capital stock the Company may issue from 510,000,000 to 1,010,000,000 shares.
SEC Investigation
The Staff of the Division of Enforcement (the "Staff") informed the Company that it has concluded its investigation and believes that certain former senior executives of the company misled investors in late 2020 and early 2021 regarding 2021 and 2022 projections of revenue from a pipeline of engineering services projects, violating Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder. In March 2021, when new leadership of the Company decided to discontinue engineering services as a potential revenue stream, these projections were revised to zero. The Staff also believes that a former senior executive received a payment of nearly $1 million from the company’s former owners in the Fall of 2020 that was not properly disclosed, violating Sections 13(a) and 14(a) of the Exchange Act and Rules 13a-11 and 14a-9 promulgated thereunder. Finally, the Staff believes that Canoo is liable for the conduct of these former senior executives. While not admitting to the Staff’s findings, the company has decided to resolve the Staff’s investigation into the Company by agreeing in principle with the Staff to a cease and desist order and payment of a $1.5 million penalty, payable in equal installments of $375,000 over each of the next four quarters beginning in the second quarter of 2023. This settlement is not, and cannot be, final until it is approved by a majority of the Commissioners of the SEC. The Company understands that the Staff’s investigation into certain former senior executives is ongoing.
Purchase and Sale Agreement for Manufacturing Facility
On November 9, 2022, the Company entered into a Purchase and Sale Agreement ("PSA") with Terex USA, LLC ("Terex") for the purchase of approximately 630,000 square foot vehicle manufacturing facility on approximately 121 acres in Oklahoma City, Oklahoma. The purchase price for the facility is $35.9 million.On January 23, 2023, the Company and Terex entered into the first amendment to the PSA ("PSA Amendment"). Pursuant to the PSA Amendment, the Company has the right to extend the initial inspection period for a period commencing on February 23, 2023 and ending on March 24, 2023, which was exercised on February 21, 2023. Additionally, the closing must occur before April 24, 2023.
Nasdaq Deficiency Letter
On March 27, 2023, we received a letter from The Nasdaq Stock Market advising us that for 30 consecutive trading days preceding the date of the letter, the bid price of our common stock had closed below the $1.00 per share minimum required for continued listing on The Nasdaq Capital Market pursuant to listing rules, and therefore we could become subject to delisting if we did not regain compliance within the 180 day compliance period (or the compliance period as may be extended).
Amendment to Panasonic Sales Agreement
On March 29, 2023, the Company amended the purchase plan in the Sales Agreement, entered into on October 15, 2021, with Panasonic Industrial Devices Sales Company of America, a Division of Panasonic Corporation of America (“PIDSA”) and SANYO Electric Co., Ltd., acting through its Mobility Energy Business Division (“SANYO”, and, together with PIDSA, “Panasonic”) for the supply of lithium-ion battery cells to address updates to the Company's vehicle production strategy.
The Company has analyzed its operations subsequent to December 31, 2022 through the date these financial statements were issued and has determined that it does not have any additional material subsequent events to disclose.
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