Rivian Automotive Enters Into $6.6 Billion Loan Agreement with U.S. Department of Energy

Rivian Automotive, Inc. recently disclosed on its Form 8-K filing that it has entered into a Loan Arrangement and Reimbursement and Sponsor Support Agreement with the United States Department of Energy (DOE). The agreement, effective January 16, 2025, outlines a commitment for a multi-draw term loan facility totaling up to $6.6 billion, with two tranches. The first tranche, referred to as the Note A Loan, amounts to approximately $3.36 billion over a 15-year term, and the second tranche, known as the Note B Loan, totals up to $2.62 billion over a 10-year term.

The purpose of the loan is to fund the development of an electric vehicle manufacturing facility located in Stanton Springs North near the City of Social Circle, Georgia. This facility is planned to be constructed in two production blocks, with Block 1 and Block 2 collectively forming the Project. The Loan Agreement contains provisions for making advances to fund eligible project costs subject to specific conditions set forth by the DOE.

The Loan Arrangement involves various conditions precedent for requesting advances under each tranche, with the Sponsor, Rivian Automotive, and certain subsidiaries jointly and severally guaranteeing the Borrower’s obligations. These obligations include repayment of both principal and interest on the Note A and Note B Advances to the DOE and Federal Financing Bank.

Additionally, the Loan Agreement establishes conditions for equity contributions from Rivian towards cost overruns and project-specific expenses until the Contingent Equity Cap is reached for each block. The agreement also outlines covenants, events of default, collateral requirements, and the application of interest rates tied to the United States Treasury-equivalent yield curve with 0% credit spread.

Rivian has 52 months from the date of the agreement to draw the initial advance, with amortization schedules set to commence at specified dates for Block 1 and Block 2. The company’s press release and shareholder letter issued on January 16, 2025, provide further insight into this significant financial development.

The Form 8-K filing also includes forward-looking statements regarding the implications of the loan agreement and the anticipated outcomes of the Project. This information is deemed important for investors and stakeholders interested in Rivian’s strategic initiatives and financial undertakings.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Rivian Automotive’s 8K filing here.

About Rivian Automotive

Rivian Automotive, Inc, together with its subsidiaries, designs, develops, manufactures, and sells electric vehicles and accessories. The company offers consumer vehicles, including a two-row, five-passenger pickup truck under the R1T brand, a three-row, seven-passenger sport utility vehicle under the R1S name.