8-K/A: Workhorse Files Pro Forma Financials for Motiv Merger

Workhorse Group Inc. filed pro forma financials for its merger with Motiv Power Systems, Inc., revealing significant combined losses and a going concern warning for Motiv.

Summary

• Workhorse Group Inc. completed its merger with Motiv Power Systems, Inc. on December 15, 2025, with Motiv becoming an indirect, wholly-owned subsidiary of Workhorse.
• The merger is accounted for as a reverse acquisition, treating Motiv as the accounting acquirer and Workhorse as the accounting acquiree.
• Pre-merger Motiv investors will initially own approximately 62.5% of the combined company, while Workhorse shareholders will maintain approximately 26.5%.
• Unaudited pro forma combined financials for the year ended December 31, 2024, show a net loss of $(123,328,757) on revenues of $13,660,284.
• For the nine months ended September 30, 2025, pro forma combined net loss was $(63,353,353) on revenues of $20,163,909.
• Motiv Power Systems, Inc. has historically incurred significant losses and negative cash flows from operations, raising substantial doubt about its ability to continue as a going concern.
• The allocation of the purchase price for the merger is preliminary and subject to material adjustment for up to one year from the acquisition date.
• Motiv's historical financial statements were restated to correct an error in the calculation of weighted average shares outstanding, which had overstated net loss per share.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing with low sentiment due to Motiv's severe historical financial distress, including significant losses and a going concern warning, which are projected to continue for the combined entity despite the strategic merger and new financing.

Positives

• The merger provides Workhorse with up to $50 million in debt financing from Motiv's largest investor, including a $10 million revolving credit facility at closing and a $40 million asset-based lending facility post-closing for vehicle manufacturing.
• The merger structure eliminates Motiv's outstanding financial indebtedness and certain warrants, simplifying the capital structure of the acquired entity.

Negatives

• Motiv Power Systems, Inc. has a significant working capital deficiency and has incurred substantial losses and negative cash flows from operations since inception, raising substantial doubt about its ability to continue as a going concern.
• The pro forma combined entity projects significant net losses: $(123,328,757) for the year ended December 31, 2024, and $(63,353,353) for the nine months ended September 30, 2025.
• Motiv's accumulated deficit reached $(295.3) million as of September 30, 2025.
• The purchase price allocation for the merger is preliminary and subject to material adjustments, which could impact future financial reporting.

Risks

• Substantial doubt exists about Motiv's ability to continue as a going concern due to significant losses and negative cash flows from operations.
• Uncertainty of market acceptance for the combined company's products.
• Intense competition from substitute products and larger companies in the electric vehicle market.
• Challenges in securing and protecting proprietary technology.
• Dependence on key individuals and sole source suppliers for critical components.
• Operations are subject to new laws, regulations, and compliance, with significant changes potentially impacting revenue negatively.
• Need to obtain additional financing to fund operations and commercialize products, with no assurance of availability or favorable terms.
• High customer concentration, with a few customers accounting for a significant portion of revenue and accounts receivable (e.g., 81% of 9M 2025 revenue from four customers).
• Reliance on specific suppliers for key components, where loss or curtailment could significantly impact short-term operations.
• A pending administrative Trademark Trial and Appeal Board (TTAB) opposition could affect the company's ability to use its 'Motiv' marks in disputed classes of goods and services.

Future Outlook

Motiv anticipates that operating losses will continue to increase in the future due to increased headcount and other costs necessary to develop and release its next-generation technology, increase manufacturing capacity, and gain market share. The company's objective is to increase revenues and decrease cost of goods sold per product to generate positive operating and cash flow levels within the next few years, but there is no assurance of success. The combined entity will need to continue raising capital to fund operations and commercialize products.

Management Comments

• Management believes that the assumptions provide a reasonable basis for presenting the significant effects directly attributable to the business combination.
• Management believes that the pro forma adjustments give appropriate effect to those assumptions and are properly applied in the unaudited pro forma condensed combined financial statements.
• Motiv's objective is to increase its revenues from the sales of its products and to decrease its cost of goods sold per product within the next few years sufficient to generate positive operating and cash flow levels.

Industry Context

StockSavvy.ai notes that this merger positions Workhorse Group Inc. to expand its presence in the medium-duty electric transport vehicle market by integrating Motiv's electrified chassis and accessories. The industry is highly competitive and capital-intensive, with significant investments required for product development and manufacturing capacity. The combined entity faces the challenge of achieving market acceptance and scaling production amidst ongoing technological advancements and regulatory changes.

Comparison to Industry Standards

• No specific comparable companies or industry benchmarks were provided in the filing to assess the results against global standards. The filing focuses on the pro forma impact of the merger rather than a comparative industry analysis.

Legal Proceedings

• Motiv Power Systems, Inc. filed an administrative Trademark Trial and Appeal Board (TTAB) opposition to Motive Technologies, Inc.'s application(s) to use its 'Motive' mark. An adverse decision could affect Motiv's ability to use its marks in disputed classes of goods and services.

Related Party Transactions

• Motiv's Senior Secured Promissory Note, with a balance of $103,381,656 as of September 30, 2025, is with a related party preferred stockholder.
• Previous convertible promissory notes, totaling $50 million in principal and interest, were issued to related parties and converted into Series A Preferred Stock on June 14, 2024.
• The merger agreement includes up to $50 million in debt financing from entities affiliated with Motiv's largest investor.

Stakeholder Impact

• Shareholders of Workhorse Group Inc. will see their ownership diluted, with pre-merger Motiv investors owning approximately 62.5% of the combined company and Workhorse shareholders maintaining approximately 26.5%.
• Employees of Motiv may experience increased headcount and costs associated with developing next-generation technology and increasing manufacturing capacity.
• Creditors of Motiv will have their outstanding principal and accrued interest on the A&R notes (approximately $101 million) satisfied by the proceeds from the merger with Workhorse.
• Customers may benefit from increased manufacturing capacity and next-generation technology, but face risks related to product acceptance and supplier dependence.

Next Steps

• Workhorse Group Inc. will finalize the detailed valuation study and purchase price allocation for the merger, which is subject to adjustment during the measurement period (not to exceed one year from the acquisition date).
• Workhorse will need to obtain shareholder approval for the merger.
• The combined company plans to fund vehicle manufacturing activities using the $40 million ABL facility upon receipt of confirmed purchase orders.
• Motiv aims to increase revenues and decrease cost of goods sold per product to achieve positive operating and cash flow levels in the coming years.

Key Dates

Recommendation

The filing reveals severe financial distress for Motiv Power Systems, Inc., including a 'going concern' warning, substantial historical losses, and negative cash flows. The pro forma financials for the combined entity also project significant losses. While the merger provides a capital injection, the underlying business challenges and the preliminary nature of the financial projections, coupled with the high ownership stake of the distressed entity's investors, suggest a high-risk investment with significant downside potential. The long path to profitability and the inherent risks in the competitive EV market make this a 'strong sell' for seasoned investors.

Keywords

Workhorse Group Inc., Motiv Power Systems Inc., Merger Agreement, SEC Filing, Pro Forma Financials, Electric Vehicles, Commercial Vehicles, Reverse Acquisition, Going Concern, Financial Losses, Debt Financing, EV Chassis, Corporate Governance, Risk Factors