InterPrivate II Acquisition Corp. (NYSE:IPVA) announced this morning that it has entered into a non-redemption agreement with the Magnetar Funds in connection to its proposed merger with carsharing marketplace Getaround.
Pursuant to the agreement, each non-redeeming stockholder agreed that it will not redeem an amount of shares of Class A Common Stock up to an aggregate of 1,550,000 shares. This is provided that InterPrivate II and Getaround require no more than $15.5 million of additional gross proceeds to satisfy the minimum cash condition of at least $50 million, and at least 9,000,000 shares of common stock will be offered by InterPrivate II to all non-redeeming holders on a pro rata basis without payment of a purchase price upon the completion of the business combination.
In consideration of the non-redeeming stockholder’s commitment to not redeem the committed shares, InterPrivate II agreed to pay a cash fee of $3 million upon the closing of the transaction and the sale of the notes pursuant to the Mudrick Note Subscription Agreement.
As background, InterPrivate II initially agreed to fund the deal with about $259 million from its trust supplemented by $175 million in convertible notes from Mudrick Capital Management and $50 million from a PIPE and other instruments.
Additionally, each non-redeeming stockholder agreed that until the earlier of the completion of the deal, an announcement that the deal will not occur, or January 31, 2023, it will not transfer, pledge, or engage in any short sales with respect to shares of common stock it currently beneficially owns in excess of an aggregate limit of 454,500 shares when taken together with any actions taken by the other non-redeeming stockholders.
IPVA inked its $900 million business combination with Getaround on May 11, 2022. San Francisco-based Getaround allows users to rent out their cars to short-term renters in a similar model as Airbnb (NASDAQ:ABNB).