Getaround Receives Commitment from Mudrick Capital for Additional $20 Million Financing and Intent to Convert $10 Million of Existing Convertible Debt at $0.25 Per Share

Rhea-AI Summary

Getaround (NYSE: GETR), a leading carsharing marketplace, has secured a $20 million capital commitment from Mudrick Capital Management. This financing will be provided by July 26, 2024. Additionally, Mudrick Capital plans to convert $10 million of existing convertible debt into Getaround shares at $0.25 per share, subject to shareholder approval during the company's annual meeting on July 31, 2024. This move reflects Mudrick Capital's confidence in Getaround's progress towards profitability.

Positive

• Secured $20 million in additional financing from Mudrick Capital.
• Mudrick Capital's intent to convert $10 million of convertible debt into shares at $0.25 per share.

Negative

• Conversion price of $0.25 per share is subject to shareholder approval.

Insights

Financial Analyst

Getaround's announcement of a $20 million financing commitment from Mudrick Capital Management signifies an important capital infusion that could help stabilize the company's financials. This capital is essential for operations, particularly as Getaround attempts to scale and reach profitability.

The decision by Mudrick Capital to convert $10 million of existing convertible debt into equity at $0.25 per share is noteworthy. This conversion price is relatively low and suggests Mudrick sees potential upside in Getaround's stock price. For retail investors, this could imply Mudrick has confidence in Getaround's long-term strategy and market position.

However, it's critical to consider the 8.00%-9.50% interest rates on the notes, which are quite high and indicate previous financial distress or risk. The conversion to equity might also dilute current shareholders' value. This could mean potential short-term pressure on Getaround’s stock price as the market digests the dilution but might be beneficial in the long run if the company becomes profitable.

Market Research Analyst

For investors, the key takeaway here is the strategic endorsement from a significant financial partner. Mudrick Capital's continued involvement reflects a vote of confidence in Getaround's business model and operational strategy. This endorsement can positively influence market perceptions and potentially attract other investors.

Getaround operates in a competitive car-sharing market and a strong financial backing can provide the resources to enhance technology, expand market reach and improve customer acquisition strategies.

It's also important to note the timing: the additional capital is designated to be available by July 2024, aligning with the company's annual stockholder meeting. This timing is strategic, potentially creating a positive sentiment around the stockholder meeting and aligning with any new strategic announcements the company might make.

SAN FRANCISCO--(BUSINESS WIRE)-- Getaround (NYSE: GETR), the world's first connected carsharing marketplace, today announced it received a written commitment from Mudrick Capital Management L.P. (“Mudrick Capital”) to provide $20 million in additional capital on or prior to July 26, 2024, pursuant to the company’s existing debt facility with Mudrick Capital. Getaround also received written notice from Mudrick Capital of its intention to convert a minimum of $10 million worth of its outstanding 8.00%/9.50% Convertible Senior Secured PIK Toggle Notes due 2027 at an as-adjusted conversion price of $0.25 per share, within 45 days after the Company’s 2024 Annual Stockholder Meeting scheduled to take place on July 31, 2024. The amendment of such conversion price to $0.25 per share is subject to stockholder approval at such annual meeting and required pursuant to the terms of the previously disclosed super priority promissory note between the Company and Mudrick Capital.

“We are grateful for the continued vote of confidence from Mudrick Capital reflected in this additional investment and their stated intention to convert a portion of the outstanding convertible debt as we continue to make significant progress on our path to profitability,” said Eduardo Iniguez, Getaround’s Chief Executive Officer.

About Getaround

Offering a digital experience, Getaround makes sharing cars and trucks simple through its proprietary cloud and in-car Getaround Connect^® technology. The company empowers consumers to shift away from car ownership through instant and convenient access to desirable, affordable, and safe cars from entrepreneurial hosts. Getaround’s on-demand technology enables a contactless experience - no waiting in line at a car rental facility, manually completing paperwork or meeting anyone to collect or drop off car keys. Getaround’s mission is to utilize its peer-to-peer marketplace to help solve some of the most pressing challenges facing the world today, including environmental sustainability and access to economic opportunity. Launched in 2011, Getaround is available today in more than 1,000 cities across 8 countries including the United States and Europe. For more information, please visit https://www.getaround.com/.

Forward-Looking Statements

This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995. In particular, the statements contained in the quotations of our Chief Executive Officer with respect to expectations regarding additional funding and the Company’s progress on its path to profitability may constitute forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical facts and generally contain words such as "believes”, "expects”, "may”, "will”, "should”, "seeks”, "approximately”, "intends”, "plans”, "estimates”, "anticipates”, and other expressions that are predictions of or indicate future events. Although the forward-looking statements contained in this press release are based upon information available at the time the statements are made and reflect management's good faith beliefs, forward-looking statements inherently involve known and unknown risks, uncertainties and other factors, including the dilutive effect of future financings, which may cause the actual results, performance or achievements to differ materially from anticipated future results.

These risks and uncertainties include those described in our filings which we make with the SEC from time to time, including the risk factors contained in our Annual Report on Form 10-K for the year ended December 31, 2023. You should not place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, except as required by applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240709411045/en/

Investors:

investors@getaround.com

Media:

press@getaround.com

Source: Getaround

FAQ

What new financing did Getaround secure?

Getaround secured an additional $20 million in financing from Mudrick Capital Management.

What is the planned conversion rate for Getaround's convertible debt?

Mudrick Capital plans to convert $10 million of Getaround's convertible debt at $0.25 per share.

When will Getaround's shareholders vote on the debt conversion?

Shareholders will vote on the debt conversion during Getaround's annual meeting on July 31, 2024.

By when will the additional $20 million financing be provided?

The additional $20 million financing will be provided by July 26, 2024.

What is the ticker symbol for Getaround?

The ticker symbol for Getaround is GETR.