Presto Automation Inc. announced that it entered into participation agreement, subordination agreement with returning lender Presto CA LLC for gross proceeds of $4,000,000 on March 21, 2024. The company will issue senior secured non-convertible promissory note in the principal amount of $4,000,000. The company will raise the amount in two tranches.

The first tranche is made on March 21, 2024, with the amount of $2,000,000. The second tranche will be made on March 30, 2024, with the amount of $2,000,000. The second tranche is subject to the following conditions.

The notes shall be repaid no later than May 15, 2024. Interest on the note accrues by increasing principal at a rate of 12.0% per annum. On the maturity date, company will pay the interest then due by adding such outstanding interest to the aggregate principal amount of the note.

The note is secured by a first priority lien on substantially all of the company?s assets, pursuant to that certain security agreement, dated as of March 21, 2024, by and between the company, Presto Automation LLC, a wholly owned subsidiary of the company, and Presto CA.