ARVL - Arrival rallies after lining up new funding

Arrival ( NASDAQ: ARVL ) jumped in early trading on Tuesday after announcing it will raise up to $50M of new equity capital through the sale of new common stock to Antara Capital Master Fund LP.

The additional $50M of capital will support the ongoing development of Arrival's ( ARVL ) products.

As for details, the London-based company said it will exchange $121.9M principal amount of 3.50% convertible notes due 2026 held by Antara for additional equity in a move that it noted will significantly reducing its debt and improve the liquidity position.

Under the terms of the transaction agreements, Arrival will issue 125M shares of new equity in exchange for $25M of cash. Antara has also committed to provide a further $25M of additional capital to be invested from time to time after May 15 and no later than June 30  by subscribing for additional equity at a price no greater than $0.20 per share.

As part of the transaction agreements, Antara has committed to hold 100M of newly issued shares for a period of 12 months and has provided the company the right to repurchase the lock-up shares within the same 12 month period at a price of $0.40 per share.

Shares of Arrival ( ARVL ) were up 6.50% in the premarket session on Tuesday.

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