Aterian enters $1 million unsecured loan agreement with stockholder

Aterian, Inc. has reached a $1 million unsecured loan agreement with its stockholder, Chen Zhipeng, according to a recent SEC filing. The company, valued at just $10.52 million, has been struggling with cash flow issues and is currently rated as WEAK by InvestingPro, indicating a concerning pace of cash burn with a negative levered free cash flow of $2.6 million over the past year.

The loan agreement allows Aterian to receive advances up to $1,000,000 at an 8.0% annual interest rate, calculated on a 360-day year and accruing daily from the funding date. The note is set to mature in eight months, with the option for early repayment without penalty. If Aterian undergoes a private placement equity financing, the lender has the option to convert the outstanding amount into common shares at a determined price and terms.

This agreement is subject to compliance with Nasdaq's share issuance limits and other listing requirements. Recent changes in control and board composition, as well as a contingent value rights (CVR) payment, have also been announced by the company.