Written by Cláudio Afonso | LinkedIn | X
The struggling EV maker Canoo disclosed in an SEC filing on Tuesday that it has entered into a $12 million secured revolving credit facility with AFV Management Advisors, LLC, an entity founded by the company’s CEO Tony Aquila.
In the same SEC filing, the company announced that its Chief Financial Officer Greg Ethridge and General Counsel Hector Ruiz resigned on the last day of October.
The secured facility was previewed on October 25, when Canoo announced it had raised $1.12 million through a promissory note issued by AFV. At the time, Canoo stated, “No terms for the credit facility have been set, and there is no guarantee the facility will be established.”
The Texas-headquartered EV maker became part of AFV’s investments in July 2020 when Aquila initially agreed to provide rescue capital to the company.
AFV Partners was founded in 2019 by Tony Aquila and is “a long-term sustainable capital vehicle that invests globally in assets that contribute to a net positive impact on the environment,” according to the official website.
With the credit facility finalized, Canoo has made an initial draw of $3.9 million, which was used to repay the previous note in full.
The facility’s advances are “secured by a first priority lien and security interest on the Company’s subsidiary’s equipment” at Canoo’s Oklahoma City site, along with certain cash proceeds. It carries an interest rate of the One-Month SOFR plus 6%, with Canoo required to repay principal within 120 days of each advance.
Canoo’s filing noted additional terms, including restrictions on pledging assets to other parties, and stated that AFV may demand repayment if “one or more events of default shall have occurred and be continuing.” Future advances beyond the initial $2 million committed by AFV are subject to its discretion.
Canoo shares closed 10.54% higher at $0.43 on Tuesday after having declined 50% between last week and Monday.
Last week, the company announced it had furloughed 23% of the workforce, equivalent to 30 employees, at its Oklahoma plant as part of what it described as a “broader realignment of North American operations.”
Canoo shares closed 10.54% higher at $0.43 on Tuesday after having declined 50% between last week and Monday.
Canoo’s internal memo, issued by General Counsel Hector Ruiz, notified staff that the furlough period may be “adjusted at the sole discretion of the company.”
In addition to the furlough, employees were informed that health insurance coverage would end effective October 31, the day they were notified. However, on Saturday, Canoo issued a new statement extending health benefits for furloughed workers through November 30, responding to concerns raised by affected employees.
In a new statement, the EV maker said on Saturday it would extend healthcare benefits for furloughed employees from October 31 to November 30, responding to feedback from affected workers.
“We are committed to supporting our impacted workers during this challenging time and will provide necessary resources to assist them,” Canoo said.
Written by Cláudio Afonso | LinkedIn | X
