Canoo Inc. (NASDAQ:GOEV), a company specializing in motor vehicle parts and accessories, has entered into a financial agreement with AFV Management Advisors, LLC, an entity affiliated with Tony Aquila, Canoo's CEO and Executive Chair. On Monday, Canoo issued an Unsecured Grid Promissory Note to AFV, initially amounting to $850,000, which was followed by a second advance of $270,000 on Thursday, bringing the total principal to $1.12 million.
The note carries an 11% annual interest rate, with monthly payments and a full repayment due by October 18, 2025. Canoo has the option to prepay the note, in whole or in part, without any penalties. The agreement also includes a provision for the parties to negotiate the establishment of a secured revolving credit facility, although there is no guarantee that such an arrangement will be finalized.
This transaction, approved by Canoo's independent directors, is deemed a related party transaction due to Mr. Aquila's position within the company. In the event of a default, AFV reserves the right to demand immediate payment of the principal and accrued interest.
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