DEFA14A: Workhorse Group Files Proxy for Motiv Power Systems Merger

Workhorse Group Inc. has filed definitive additional materials with the SEC to solicit proxies for its 2025 Annual Meeting of Stockholders regarding the proposed merger with Motiv Power Systems, Inc.

Summary

• Workhorse Group Inc. (Workhorse) has filed Definitive Additional Materials (DEFA14A) with the U.S. Securities and Exchange Commission (SEC).
• The filing pertains to the Agreement and Plan of Merger, dated August 15, 2025, between Workhorse and Motiv Power Systems, Inc. (Motiv).
• The primary purpose of this filing is to solicit proxies for Workhorse's 2025 Annual Meeting of Stockholders (Annual Meeting).
• Stockholders are strongly advised to thoroughly read the Definitive Proxy Statement and all other relevant documents filed or to be filed with the SEC, as they contain crucial information regarding Workhorse and the matters to be voted on at the Annual Meeting.

Sentiment

Score: 4

Explanation: The filing is primarily procedural for a merger, which can be a strategic positive. However, it contains an extensive list of significant risks associated with the merger's execution, integration, and the company's ongoing operational and financial health, including challenges in capital raising and liquidity. This introduces considerable uncertainty and potential negative outcomes, tempering any positive sentiment from the merger announcement itself.

Positives

• The proposed merger is anticipated to bring benefits and synergies to the combined company.

Risks

• The parties' ability to successfully integrate their businesses and technologies may result in the combined company not operating as effectively and efficiently as expected.
• 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, including 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.
• Any required regulatory approval, consent or authorization for the proposed transaction may not be obtained or may be obtained subject to unanticipated conditions.
• 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.
• Ability to develop and manufacture the product portfolio, including the W4 CC, W750, and W56 and other programs.
• 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 Workhorse does business.
• Supply chain disruptions, including constraints on steel, semiconductors and other material inputs and resulting cost increases impacting Workhorse, its customers, its suppliers or the industry.
• 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.
• 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.
• 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.
• Ability to protect intellectual property.
• Market acceptance of products.
• Ability to obtain sufficient liquidity from operations and financing activities to continue as a going concern and, 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.
• Inability to retain key members of the management team.
• Inability to satisfy customer warranty claims.
• The outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc.
• Ability to realize the benefits of the sale and leaseback transaction of the Union City Facility.

Future Outlook

The filing discusses the anticipated benefits and synergies of the proposed merger between Workhorse and Motiv, but also extensively details numerous risks and uncertainties that could cause actual outcomes and results to differ materially from any forward-looking statements. It explicitly states that these statements are not guarantees of future performance.

Industry Context

The proposed merger between Workhorse, a manufacturer of electric commercial vehicles, and Motiv Power Systems, a provider of electric vehicle chassis and powertrains, suggests a strategic move towards vertical integration or consolidation within the electric commercial vehicle sector. This aligns with broader industry trends where companies seek to enhance technological capabilities, achieve economies of scale, and strengthen market position amidst increasing competition and evolving regulatory landscapes in the EV market.

Legal Proceedings

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

Stakeholder Impact

• Shareholders: Will be required to vote on the merger, face uncertainty regarding the long-term value of the combined company's common stock, and potential dilution from future financing activities.
• Employees: May experience disruption to current plans and operations, and the company faces potential difficulties in hiring or retaining employees as a result of the proposed transaction, alongside the effects of furloughing employees mentioned as a risk.
• Customers: Impacted by the company's ability to develop and manufacture its product portfolio and attract/retain customers, as well as potential supply chain disruptions.
• Suppliers: May be affected by supply chain disruptions, including constraints on material inputs and resulting cost increases.
• Creditors: Impacted by the company's ability to obtain sufficient liquidity and raise additional capital to fund operations.

Next Steps

• Workhorse stockholders are urged to read the Definitive Proxy Statement and other relevant documents carefully and in their entirety.
• Workhorse stockholders will vote on the proposed merger at the 2025 Annual Meeting of Stockholders.
• Workhorse will file the Definitive Proxy Statement and other relevant documents with the SEC, which will be available on www.sec.gov and www.ir.workhorse.com.

Key Dates

Recommendation

The filing details a proposed merger with Motiv Power Systems, which could offer strategic benefits through combined technologies and market reach in the electric commercial vehicle sector. However, it also outlines a comprehensive array of risks, including integration difficulties, failure to achieve expected synergies, regulatory hurdles, and significant ongoing operational and financial challenges for Workhorse, such as capital raising difficulties and supply chain disruptions. The uncertainty surrounding the successful execution of the merger and the mitigation of these substantial risks warrants a cautious approach. Investors should hold their position and monitor the progress of the merger, the realization of synergies, and the company's ability to address its liquidity and operational risks before making further investment decisions.

Keywords

Workhorse Group, Motiv Power Systems, Merger Agreement, Proxy Solicitation, SEC Filing, Electric Vehicles, Commercial Vehicles, Corporate Governance, Shareholder Meeting, Risk Factors