DEFA14A: Workhorse Group Announces Merger with Motiv Power Systems

Workhorse Group Inc. has entered into a definitive merger agreement with Motiv Power Systems, Inc., pending shareholder approval at the 2025 Annual Meeting.

Summary

• Workhorse Group Inc. (Workhorse) has signed an Agreement and Plan of Merger with Motiv Power Systems, Inc. (Motiv) and related entities, dated August 15, 2025.
• The filing serves as a communication to Workhorse's employees, customers, partners, and analysts regarding this merger agreement.
• Workhorse has filed a definitive proxy statement on Schedule 14A and a proxy card with the SEC for its 2025 Annual Meeting of Stockholders.
• Stockholders are strongly encouraged to review these materials, which contain crucial information about Workhorse and the merger-related matters to be voted on at the Annual Meeting.
• Details concerning participants in the proxy solicitation, including Workhorse's directors and officers, are available in the company's Annual Report on Form 10-K for the year ended December 31, 2024, and will be further detailed in the proxy statement.

Sentiment

Score: 6

Explanation: The filing announces a significant strategic merger, which is generally viewed as a positive step for growth and synergy. However, it also extensively details numerous risks associated with the merger and the company's ongoing operations, including integration challenges, regulatory hurdles, market acceptance, and liquidity concerns, balancing the overall sentiment.

Positives

• Anticipated benefits and synergies are expected from the proposed merger transaction between Workhorse and Motiv.
• The merger has the potential for the combined company to operate more effectively and efficiently through the integration of businesses and technologies.

Risks

• The parties' ability to successfully integrate their businesses and technologies, which may result in the combined company not operating as effectively and efficiently as expected.
• The risk that the expected benefits and synergies of the proposed transaction may not be fully achieved in a timely manner, or at all.
• Workhorse's ability to obtain the approval of its shareholders required to consummate the proposed transaction and the timing of the closing of the proposed transaction.
• The risk that the conditions to the transaction are not satisfied on a timely basis or at all, or the failure of the transaction to close for any other reason or to close on the anticipated terms.
• The risk that any regulatory approval, consent, or authorization that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated.
• The occurrence of any event, change, or other circumstance that could give rise to the termination of the proposed transaction.
• Unanticipated difficulties, liabilities, or expenditures relating to the transaction.
• The effect of the announcement, pendency, or completion of the proposed transaction on the parties' business relationships and business operations generally.
• The effect of the announcement or pendency of the proposed transaction on Workhorse's common stock prices and uncertainty as to the long-term value of the combined company's common stock.
• Risks that the proposed transaction disrupts current plans and operations of the parties and their respective management teams and potential difficulties in hiring or retaining employees as a result of the proposed transaction.
• The ability to develop and manufacture the product portfolio, including the W4 CC, W750, and W56 and other programs.
• The ability to attract and retain customers for existing and new products.
• Ongoing and anticipated changes in the U.S. political environment, including those resulting from the new Presidential Administration, control of Congress, and changes to regulatory agencies.
• The implementation of changes to the existing tariff regime by the new Presidential Administration and measures taken in response to such tariffs by foreign governments.
• Risks associated with obtaining orders and executing upon such orders.
• The unavailability, reduction, elimination, or adverse application of government subsidies and incentives or any challenge to or failure by the federal government, states, or other governmental entities to adopt or enforce regulations such as the California Air Resource Board's Advanced Clean Fleet regulation.
• Changes in attitude toward environmental, social, and governance matters among regulators, investors, and parties with which the company does business.
• Supply chain disruptions, including constraints on steel, semiconductors, and other material inputs and resulting cost increases impacting the company, its customers, suppliers, or the industry.
• The ability to capitalize on opportunities to deliver products to meet customer requirements.
• Limited operations and need to expand and enhance elements of the production process to fulfill product orders.
• General inability to raise additional capital to fund operations and business plan.
• The ability to receive sufficient proceeds from current and any future financing arrangements to meet immediate liquidity needs and the potential costs, dilution, and restrictions resulting from any such financing.
• The ability to maintain compliance with the listing requirements of the Nasdaq and the impact of any steps taken, including reverse splits of common stock, on operations, stock price, and future access to funds.
• The ability to protect intellectual property.
• Market acceptance of products.
• The ability to obtain sufficient liquidity from operations and financing activities to continue as a going concern and, the ability to control expenses.
• The effectiveness of cost control measures and impact such measures could have on operations, including the effects of furloughing employees.
• Potential competition, including without limitation shifts in technology.
• Volatility in and deterioration of national and international capital markets and economic conditions.
• Global and local business conditions.
• Acts of war (including without limitation the conflicts in Ukraine and the Middle East) and/or terrorism.
• The prices being charged by competitors.
• The inability to retain key members of the management team.
• The inability to satisfy customer warranty claims.
• The outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc.
• The ability to realize the benefits of the sale and leaseback transaction of the Union City Facility.

Future Outlook

The proposed merger aims to integrate the businesses and technologies of Workhorse and Motiv, with an expectation that the combined company will operate more effectively and efficiently, achieving anticipated benefits and synergies. The transaction is subject to shareholder and regulatory approvals, with an anticipated closing date.

Legal Proceedings

• The outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc., is a risk factor.

Stakeholder Impact

• Shareholders: Will vote on the merger, face uncertainty regarding the long-term value of the combined company's common stock, and potential dilution from future financing.
• Employees: Potential difficulties in hiring or retaining employees as a result of the proposed transaction, and effects of furloughing employees due to cost control measures.
• Customers: Impact on business relationships and ability to deliver products to meet requirements.
• Partners: Impact on business relationships.
• Creditors: Impact on liquidity and ability to raise capital.

Next Steps

• Workhorse stockholders will vote on the proposed merger at the 2025 Annual Meeting of Stockholders.
• Regulatory approvals, consents, or authorizations may be required for the proposed transaction.
• The parties need to successfully integrate their businesses and technologies post-merger.
• Workhorse needs to continue developing and manufacturing its product portfolio (W4 CC, W750, W56).
• The company must attract and retain customers for its existing and new products.
• Workhorse needs to address its ability to raise additional capital and maintain Nasdaq listing compliance.

Key Dates

Recommendation

The announcement of a definitive merger agreement is a significant strategic development that could lead to long-term value creation through synergies and expanded market presence. However, the filing also highlights substantial risks associated with the integration process, regulatory approvals, market acceptance, and the company's ongoing liquidity challenges and capital raising needs. Given these factors, a 'hold' recommendation is appropriate for a seasoned investor, suggesting observation of the merger's progress and the company's ability to mitigate identified risks before making further investment decisions. The potential for disruption and the uncertainty of achieving expected benefits warrant caution despite the strategic intent.

Keywords

Workhorse Group, Motiv Power Systems, Merger Agreement, Acquisition, SEC Filing, DEFA14A, Proxy Statement, Shareholder Vote, Electric Vehicles, Commercial Vehicles, Corporate Governance, Risk Factors, NASDAQ, EV Technology