DEFA14A: Workhorse Urges Shareholder Vote for Motiv Merger

Workhorse Group Inc. is urging shareholders to vote FOR all proposals, including the merger with Motiv Power Systems, Inc., at the upcoming Annual Meeting on November 12, 2025, citing compelling value and avoiding potential liquidity issues.

Summary

• Workhorse Group Inc. (Nasdaq: WKHS) is reminding shareholders to vote FOR all proposals for the Annual Meeting on November 12, 2025.
• The key proposal is the Agreement and Plan of Merger with Motiv Power Systems, Inc., dated August 15, 2025.
• Leading independent proxy advisory firms, Institutional Shareholder Services (ISS) and Glass Lewis & Co., recommend voting FOR the merger.
• ISS cited a compelling strategic rationale, complementary businesses, expected scale benefits, material cost synergies, and addressing Workhorse's going concern risk.
• Failure to approve the merger could lead to Workhorse continuing as an independent company, likely facing liquidity issues and potential restructuring where shareholder equity would recover little to no value.
• Shareholders are encouraged to vote online at www.proxyvote.com, virtually at www.virtualshareholdermeeting.com/WKHS2025, or by returning a proxy card.
• The final deadline to vote is 11:59 pm ET on November 11, 2025.

Sentiment

Score: 3

Explanation: The filing strongly advocates for a merger as a critical step to avoid severe liquidity issues and potential loss of shareholder value, indicating a challenging standalone financial position for Workhorse, which is explicitly stated as a "going concern risk."

Positives

• The merger with Motiv Power Systems, Inc. is expected to deliver compelling value to Workhorse shareholders.
• The transaction offers a strategic rationale with complementary businesses and anticipated scale benefits, including material cost synergies.
• Independent proxy advisory firms, ISS and Glass Lewis & Co., recommend voting FOR the merger, recognizing its value.
• The merger is presented as a way to address Workhorse's going concern risk and achieve greater value for shareholders compared to liquidation or bankruptcy.
• Shareholders will have a significant ownership stake in the combined company, participating in the potential upside of a leader in the medium-duty EV commercial vehicle market.

Negatives

• Workhorse faces potential liquidity issues if the merger is not approved.
• If the merger fails, Workhorse may need to pursue a restructuring, which would likely result in very little or no value recovery for shareholders' equity.
• The company is currently considered a "going concern risk" by ISS.

Risks

• The outcome of continuing discussions between Workhorse and Motiv regarding the Transactions, including potential termination or changes to terms.
• Ability to consummate the Transactions or achieve expected synergies and/or efficiencies.
• Potential regulatory delays.
• Industry and market reaction to the announcement.
• Effect of the announcement on the parties' ability to operate their businesses, retain and hire key personnel, and maintain favorable business relationships.
• Integration of the parties may be more difficult, time-consuming, or costly than expected, or operating costs and business disruptions may be greater than expected.
• Ability to obtain regulatory and other approvals required to consummate the Transactions, including from Nasdaq.
• Risk that the price of Workhorse securities may be volatile due to various factors.
• Changes in laws, regulations, technologies, the global supply chain, and macro-economic and social environments affecting the business.
• Ability to maintain compliance with Nasdaq rules and otherwise maintain listing of securities on Nasdaq.
• Risk that the expected benefits and synergies of the proposed transaction may not be fully achieved in a timely manner, or at all.
• 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 on anticipated terms.
• Risk that any regulatory approval, consent, or authorization required for the proposed transaction is not obtained or is obtained subject to unanticipated conditions.
• Occurrence of any event, change, or circumstance that could give rise to the termination of the proposed transaction.
• Unanticipated difficulties, liabilities, or expenditures relating to the transaction.
• Effect of the announcement, pendency, or completion of the proposed transaction on business relationships and operations generally.
• 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.
• Ability to develop and manufacture product portfolio (W4 CC, W750, W56).
• Ability to attract and retain customers for existing and new products.
• Ongoing and anticipated changes in the U.S. political environment, including new Presidential Administration, control of Congress, and changes to regulatory agencies.
• Implementation of changes to the existing tariff regime by the new Presidential Administration and measures taken in response by foreign governments.
• Risks associated with obtaining orders and executing upon such orders.
• Unavailability, reduction, elimination, or adverse application of government subsidies and incentives or challenges to regulations like California Air Resource Board's Advanced Clean Fleet.
• Changes in attitude toward environmental, social, and governance matters among regulators, investors, and business partners.
• Supply chain disruptions, including constraints on steel, semiconductors, and other material inputs, and resulting cost increases.
• Ability to capitalize on opportunities to deliver products to meet customer requirements.
• Limited operations and need to expand and enhance 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 potential costs, dilution, and restrictions from such financing.
• Ability to maintain compliance with Nasdaq listing requirements and impact of steps taken (e.g., reverse splits) 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.
• Ability to control expenses and effectiveness of cost control measures, including effects of furloughing employees.
• Potential competition, including shifts in technology.
• Volatility in and deterioration of national and international capital markets and economic conditions.
• Global and local business conditions.
• Acts of war (Ukraine, Middle East) and/or terrorism.
• Prices charged by competitors.
• Inability to retain key members of management team.
• Inability to satisfy customer warranty claims.
• Outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc.
• Ability to realize benefits of the sale and leaseback transaction of the Union City Facility.

Future Outlook

The company anticipates that the merger with Motiv will create a leader in the medium-duty EV commercial vehicle market, provide scale benefits, and material cost synergies. Without the merger, Workhorse expects to continue facing liquidity issues and potentially pursue restructuring, leading to little to no shareholder equity recovery.

Management Comments

• "Workhorse will have to continue as an independent company if we do not receive sufficient votes. If that were to occur, we will likely continue to face liquidity issues and may need to pursue a restructuring, in which shareholders equity would likely recover very little or no value. Don't go down that path."
• "The transaction warrants support in light of the compelling strategic rationale and the boards reasonably thorough review of alternatives."
• "The strategic rationale appears compelling as the companies have complementary businesses, and the transaction is expected to provide for various scale benefits, including material cost synergies."
• "Finally, the company is a going concern risk and it seems that greater value can be achieved for shareholders via this merger relative to a liquidation scenario or other bankruptcy process."

Industry Context

The filing highlights the company's focus on pioneering the transition to zero-emission commercial vehicles and becoming a leader in the medium-duty EV commercial vehicle market through the merger. This aligns with the broader industry trend towards electrification of commercial fleets and sustainable transportation solutions.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results. It generally states that the merger is expected to create a "leader in the medium-duty EV commercial vehicle market" and provide "scale benefits" and "material cost synergies," implying an improvement in competitive standing.

Legal Proceedings

• Outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc., is listed as a risk.

Stakeholder Impact

• Shareholders: Direct impact on equity value, potential for significant upside in combined company if merger approved, or little to no value recovery if merger fails and restructuring occurs.
• Employees: Potential impact on retention and hiring due to merger announcement/pendency, or potential furloughs if cost control measures are implemented without merger.
• Customers/Partners: Impact on business relationships and operations generally due to merger announcement/pendency.
• Creditors: Implied impact due to liquidity issues if merger fails.

Next Steps

• Shareholders to vote on all proposals, including the merger, by 11:59 pm ET on November 11, 2025.
• Workhorse's Annual Meeting on November 12, 2025.
• Consummation of the merger with Motiv Power Systems, Inc. if approved.
• Integration of businesses and technologies post-merger.

Key Dates

Recommendation

The filing explicitly states that Workhorse is a "going concern risk" and without the merger, it will "likely continue to face liquidity issues and may need to pursue a restructuring, in which shareholders equity would likely recover very little or no value." This dire warning about the company's standalone viability, even while advocating for the merger, indicates a highly distressed situation. The merger is presented as the only viable path to avoid significant shareholder loss, making the standalone company a strong sell.

Keywords

Workhorse Group, WKHS, Motiv Power Systems, merger, acquisition, EV, electric vehicles, commercial vehicles, proxy vote, shareholder meeting, corporate governance, liquidity, restructuring, Nasdaq, SEC filing, proxy advisory firms, ISS, Glass Lewis