Arbe Robotics Issues NIS 110M Convertible Debentures

TL;DR

Arbe Robotics raised ~$30M via debentures to Israeli investors, maturing 2028.

AI Summary

Arbe Robotics Ltd. announced on June 4, 2024, the issuance of convertible debentures totaling NIS 110,000,000 (approximately $30 million) to Israeli investors. These debentures carry a 6.5% annual interest rate and are set to mature on May 30, 2028. The issuance was not offered in the United States or to U.S. persons.

Why It Matters

This financing provides Arbe Robotics with capital to fund its operations and growth, potentially impacting its ability to develop and commercialize its radar technology.

Risk Assessment

Risk Level: medium — The issuance of convertible debentures can dilute existing shareholders' equity upon conversion and introduces debt obligations.

Key Numbers

• NIS 110,000,000 — Debenture Principal Amount (Represents the total value of the convertible debentures issued.)
• $30 million — Approximate USD Value (USD equivalent of the debenture issuance, providing a more familiar valuation.)
• 6.5% — Annual Interest Rate (The cost of borrowing for the company on these debentures.)

Key Players & Entities

• Arbe Robotics Ltd. (company) — Issuer of debentures
• NIS 110,000,000 (dollar_amount) — Principal amount of convertible debentures
• $30 million (dollar_amount) — Approximate USD equivalent of debentures
• June 4, 2024 (date) — Date of debenture issuance
• May 30, 2028 (date) — Maturity date of debentures

FAQ

Key Financial Figures

• $30 million — mount of NIS 110,000,000 (approximately $30 million). The debentures were issued solely to
• $2.60 — ersion price of NIS 9.53 (approximately $2.60) per share. The debentures are listed f
• $1 — the basic rate, which is 3.675 NIS for $1.00, there will be a proportional increa
• $30.6 million — ximately NIS 112,400,000 (approximately $30.6 million), are held in escrow and will be releas
• $3.10 — inary shares on Nasdaq is not less than $3.10 per share during 30 consecutive trading
• $5 million — ders’ equity shall not fall below $5 million as of the last day of two consecutive q
• $8,200 — a payment of NIS 30,000 (approximately $8,200) for expenses. The foregoing is a summ

Filing Documents

• ea0207447-6k_arberobo.htm (6-K) — 24KB
• ea020744701ex99-2_arberobo.htm (EX-99.2) — 11KB
• 0001213900-24-050433.txt ( ) — 36KB

From the Filing

OF FOREIGN PRIVATE ISSUER UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For the month of June 2024 Commission File Number: 001-40884 ARBE ROBOTICS LTD. (Translation of registrant’s name into English) HaHashmonaim St. 107 Tel Aviv-Yafo, Israel Tel: +972-73-7969804, ext. 200 (Address of principal executive office) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: Form 20-F Form 40-F INFORMATION CONTAINED IN THIS CURRENT REPORT ON FORM 6-K On June 4, 2024, Arbe Robotics Ltd. (the “Company”) issued its convertible debentures in the principal amount of NIS 110,000,000 (approximately $30 million). The debentures were issued solely to Israeli investors and were not offered in the United States or to U.S. persons. The debentures bear interest on the principal amount of the debentures at the rate or 6.5% per annum, mature on May 30, 2028, and are convertible into the Company’s ordinary shares at a conversion price of NIS 9.53 (approximately $2.60) per share. The debentures are listed for trading on the Tel Aviv Stock Exchange (“TASE”) and trading commenced on June 6, 2024. As previously reported, the Company’s ordinary shares are listed on Nasdaq and the TASE. Although the debentures are denominated in NIS, the principal and interest are indexed to the US dollar, such that if on any date that interest or principal is payable, the exchange rate is higher than the basic rate, which is 3.675 NIS for $1.00, there will be a proportional increase in the amount of the interest or principal payment, as applicable. No adjustment is made with respect to a downward change in the conversion rate. The debentures were issued pursuant to a deed of trust dated May 30, 2024 by and between the Company and Mishmeret Trust Company Ltd., as trustee (the “Trustee”). The proceeds from the sale of the debentures, which were approximately NIS 112,400,000 (approximately $30.6 million), are held in escrow and will be released to the Company upon satisfaction of the following release conditions by March 31, 2025: The Company wins a tender or contract to supply its products as a single supplier of chips of imaging radar (directly or through one of the international Tier 1 manufacturers) to one of ten named major automobile manufactures. The average closing trading price of the Company’s ordinary shares on Nasdaq is not less than $3.10 per share during 30 consecutive trading days, and the average combined trading volume on Nasdaq and TASE during such 30 trading days is at least 300,000 shares per day. The closing price of the Company’s ordinary shares on Nasdaq on the date the Company presents to the Trustee the documentation confirming the fulfillment of the abovementioned conditions precedent, is not less than $3.10. If the Company does not meet the release conditions by March 31, 2025, the Company will be required to effect an early redemption of the debentures, which will result in the use of the funds in the escrow account to pay the debentures, and the Company will be required to pay to the Trustee such additional amounts as are required to pay the interest and any payment due as a result of the differential in the exchange rate. Notwithstanding the foregoing, in the event that any debentures are converted into ordinary shares, the funds in the escrow account that relate to the converted debentures will be released to the Company provided that the amount remaining in the escrow account after the payment to the Company is not less than the principal amount of the outstanding debentures. The deed of trust requires the Company to comply with the following two covenants as long as the debentures are outstanding: The Company’s shareholders’ equity shall not fall below $5 million as of the last day of two consecutive quarters. The Company shall have cash, cash equivalents and short-term bank deposits of not less than $5 million as of the last day of one quarter. Although the debentures are unsecured obligations of the Company, the deed of trust provides that the Trustee will have a security interest, for the benefit of the debenture holders, in the escrow funds. The deed of trust has customary default provisions, including for failure to meet the covenants. The broker for the sale of the debentures is IBI Underwriting Ltd., which will receive as compensation 1% of the funds raised which is due upon the issuance of the debentures, 2% upon release of the funds to the Company and 2% upon conversion of the debentures and a payment of NIS 30,000 (approximately $8,200) for expenses. The foregoing is a summary of the terms of the debentures, which is qualified in its entirety by reference to the deed of trust, an Eng

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