Material Agreement Form 8 K

Item 1.01

Entry into a Material Definitive Agreement.

Prepaid Advance Agreement

On July 19, 2024 (the "Effective Date"), Canoo Inc. (the "Company") entered into a Prepaid Advance Agreement (the "PPA") with YA II PN, Ltd., a Cayman Islands exempt limited company ("Yorkville"). In accordance with the terms of the PPA, the Company may request advances of up to $15,000,000 in cash from Yorkville (or such greater amount that the parties may mutually agree) (each, a "Prepaid Advance"), including an initial Prepaid Advance of $15,000,000 (the "Initial Advance") requested by the Company in connection with entering the PPA and from time to time thereafter, with an aggregate limitation on the Prepaid Advances of $100,000,000 over the course of 24 months from the Effective Date.A Prepaid Advance will be offset upon the issuance of shares of the Company's common stock ("Common Stock") to Yorkville, from time to time upon written notice from Yorkville (each, a "Purchase Notice").

The Initial Advance will be offset upon the issuances of shares of Common Stock at an initial Purchase Price (as such term is used in the PPA) equal to $2.70 per share.

On any date that is the 60^th day after the Effective Date, the Purchase Price on any remaining amount of the Initial Advance then outstanding at such time will be the lower of (i) $2.70 per share and (ii) 95% of the lowest daily volume weighted average price ("VWAP") of the Common Stock on The Nasdaq Capital Market ("Nasdaq") during five trading days immediately preceding the date on which Yorkville provides the Purchase Notice to the Company (the "Variable Price"); however, in no event shall the Purchase Price be less than $1.00 per share (the "Floor Price").

With respect to a Prepaid Advance other than the Initial Advance, such Prepaid Advance will be offset upon the issuances of shares of Common Stock at a Purchase Price equal to the lower of (i) 120% of the daily VWAP of the Common Stock on Nasdaq as of the trading day immediately prior to the date of the disbursement of such Prepaid Advance and (ii) the Variable Price; however, in no event shall the Purchase Price be less than the Floor Price.

After giving effect to the commitment fee and the purchase price discount provided for in the PPA, net proceeds of the Initial Advance to the Company will be approximately $14.1 million. The issuance of Common Stock under the PPA is subject to certain limitations, including, among others, that the aggregate number of shares of Common Stock issued pursuant to the PPA cannot exceed 19.99% of the Company's outstanding Common Stock as of June 13, 2024 (the "Exchange Cap") unless the Company's stockholders have approved issuances in excess of the Exchange Cap. Pursuant to the terms of the PPA, interest accrues on the outstanding balance of a Prepaid Advance at an annual rate equal to 5%, subject to an increase to 15% upon events of default described in the PPA.

Pursuant to the PPA, the Company shall, among other things, (i) maintain its shelf registration statement on Form S-3 (the "Registration Statement"), (ii) register the shares of Common Stock that are to be offered and sold to Yorkville pursuant to the PPA, (iii) use the net proceeds for purposes disclosed in the respective prospectus supplement, and (iv) except as permitted under the PPA, not enter into any variable rate transactions. The shares of Common Stock to be issued under the PPA will be issued pursuant to the Registration Statement (File No. 333-264842). Promptly after the filing of this Current Report on Form 8-K, the Company is filing a prospectus supplement with the U.S. Securities and Exchange Commission in connection with the offer and sale of the shares of Common Stock.

The foregoing description of the PPA is qualified in its entirety by reference to the PPA, which is filed hereto as Exhibit 10.1 and which is incorporated herein by reference.

Attached to this Current Report on Form 8-K as Exhibit 5.1, is the opinion of Kirkland & Ellis LLP relating to the legality of the shares of Common Stock.

Warrant Agreement

On the Effective Date, in connection with the Initial Advance, the Company issued to Yorkville a warrant to purchase approximately 2.7 million shares of Common Stock each at an exercise price of $2.70 per share, exercisable beginning on January 19, 2025 and with an expiration date of July 19, 2029 (the "Warrants"). The Warrants include customary adjustment provisions for stock splits, combinations and similar events.

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