|6 Months Ended|
Jun. 30, 2022
|Subsequent Events [Abstract]|
|Subsequent Events||Subsequent Events
Electric Vehicle Fleet Purchase Agreement and Warrant
On July 11, 2022, Canoo Sales, LLC, a wholly-owned subsidiary of the Company, entered into an Electric Vehicle Fleet Purchase Agreement (the "EV Fleet Purchase Agreement") with Walmart Inc. ("Walmart"). Pursuant to the EV Fleet Purchase Agreement, subject to certain acceptance and performance criteria, Walmart agreed to purchase at least 4,500 EVs, with an option to purchase up to an additional 5,500 EVs, for an agreed upon capped price per unit determined based on the EV model. The EV Fleet Purchase Agreement (excluding any work order or purchase order as a part thereof) has a five-year term, unless earlier terminated.
In connection with the EV Fleet Purchase Agreement, the Company entered into a Warrant Issuance Agreement with Walmart pursuant to which the Company issued to Walmart a warrant (the "Warrant") to purchase an aggregate of 61.2 million shares of Common Stock, at an exercise price of $2.15 per share. The Warrant has a term of ten years and is vested immediately with respect to 15.3 million shares of Common Stock. Thereafter, subject to stockholder approval, as applicable, the Warrant will vest quarterly in amounts proportionate with the net revenue realized by the Company from transactions with Walmart or its affiliates under the EV Fleet Purchase Agreement or enabled by any other agreement between the Company and Walmart, and any net revenue attributable to any products or services offered by Walmart or its affiliates related to the Company, until such net revenue equals $300.0 million, at which time the Warrant will have vested fully. In the event that stockholder approval is not obtained, in lieu of any shares which would have been issued to Walmart on account of the Warrant, the Company is required to pay to Walmart an amount in cash calculated pursuant to the Warrant.
Yorkville Facility II
On July 20, 2022, the Company entered into the PPA with Yorkville, pursuant to which the Company may request advances of up to $50.0 million in cash from Yorkville (or such greater amount that the parties may mutually agree) (each, a "Pre-Paid Advance"), with an aggregate limit of $300.0 million. Amounts outstanding under Pre-Paid Advances can be offset by the issuance of shares of Common Stock to Yorkville at a price per share calculated pursuant to the PPA, which in no event will be less than $1.00 per share. The issuance of the shares under the PPA is subject to certain limitations, including that the aggregate number of shares of Common Stock issued pursuant to the PPA (including the aggregation with the issuance of Common Stock under the SEPA) cannot exceed 19.9% of the Company's outstanding stock as of May 10, 2022. In addition, subject to certain conditions and limitations, the Company has the right to issue shares of Common Stock and cause Yorkville to offset certain outstanding amounts under the PPA. Interest accrues on the outstanding balance of any Pre-Paid Advance at an annual rate equal to 5%, subject to an increase to 15% upon events of default described in the PPA. Each Pre-Paid Advance has a maturity date of 15 months.
On July 22, 2022, the Company received an aggregate of $49.5 million on account of the first Pre-Paid Advance in accordance with the PPA. Additional Pre-Paid Advances under the PPA are subject to conditions precedent, including that there are no more than $10.0 million outstanding under prior Pre-Paid Advances. The Company currently intends to terminate the SEPA.
On August 8, 2022, the Company entered into an At-the-Market Offering Agreement (the "ATM Agreement") with Evercore Group L.L.C. and H.C. Wainwright & Co., LLC (collectively, the "agents"), to sell shares of Common Stock having an aggregate sales price of up to $200.0 million, from time to time, through an “at-the-market offering” program under which the agents will act as sales agent. The sales, if any, will be made by any method permitted by law deemed to be an “at-the-market offering” as defined in Rule 415 promulgated under the Securities Act of 1933, as amended. The Company will pay the agents a commission rate of up to 3.0% of the gross sales price per share sold, with H.C. Wainwright & Co., LLC being entitled to an additional 1.5% of the gross sales price per share sold, and has agreed to provide the agents with customary indemnification, contribution and reimbursement rights. The ATM Agreement contains customary representations and warranties and conditions to the sales pursuant thereto. The Company is not obligated to sell any shares of Common Stock under the ATM Agreement and may at any time suspend solicitation and offers thereunder. The offering of shares of Common Stock pursuant to the ATM Agreement will terminate upon the sale of all the shares subject to the ATM Agreement or upon the termination of the ATM Agreement by either the Company or the agents, as permitted therein.The Company has analyzed its operations subsequent to June 30, 2022 through the date these financial statements were issued and has determined that it does not have any additional material subsequent events to disclose.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef