DEFA14A: Workhorse Urges Shareholder Vote for Motiv Merger

Workhorse Group Inc. is urging shareholders to vote for its proposed merger with Motiv Power Systems, Inc. at the upcoming Annual Meeting on November 12, 2025, highlighting the transaction as the only viable path forward.

Summary

• Workhorse is soliciting shareholder votes for the Agreement and Plan of Merger with Motiv Power Systems, Inc., dated August 15, 2025.
• The Annual Meeting is scheduled for November 12, 2025, and shareholders are urged to vote FOR all proposals related to the transaction.
• The merger aims to create a category leader in the medium-duty EV market, combining Motiv's product portfolio and fleet relationships with Workhorse's vehicles, manufacturing, and national dealer network.
• The combined company has collectively served 10 of the largest medium-duty fleets in North America.
• The transaction is expected to reduce unit costs, making the electric offering more competitively advantaged than gas/diesel trucks and buses on a Total Cost of Ownership (TCO) basis.
• Potential to achieve at least $20 million in cost synergies by the end of 2026, primarily from R&D, G&A, and facility cost-reductions.
• The merger is anticipated to strengthen the company's financial position, create opportunities for margin expansion, and enable greater flexibility for future growth initiatives and capital raises post-close.
• Management states that voting against the proposals could lead to a standalone path, including a potential restructuring that would likely result in Workhorse investment having little or no value.

Sentiment

Score: 8

Explanation: The filing presents a highly positive outlook on the merger's potential for growth, synergies, and financial strengthening, but also includes a stark warning about the dire consequences (little to no value) if the merger does not proceed, indicating a critical juncture for the company.

Positives

• Opportunity for Workhorse shareholders to participate in the upside of the combined company.
• Creation of a category leader positioned for rapid innovation and scalable growth in the medium-duty EV market.
• Combination of complementary strengths: Motiv's diverse product portfolio and top fleet relationships with Workhorse's proven vehicles, manufacturing capabilities, and national dealer network.
• Combined company has served 10 of the largest medium-duty fleets in North America, facilitating expanded adoption.
• Expected reduction in unit costs, enhancing competitiveness against pure-play electric and legacy OEMs, and offering a more competitively advantaged electric option on a TCO basis.
• Potential to achieve at least $20 million in cost synergies by the end of 2026 (R&D, G&A, facility cost-reductions).
• Strengthening of the company's financial position and creation of opportunities for margin expansion.
• Enables greater flexibility to pursue future growth initiatives and raise additional capital post-close.

Negatives

• Management explicitly states that voting against the merger proposals could lead to a standalone path, including a potential restructuring that would likely result in Workhorse investment having little or no value, indicating significant downside risk if the merger does not proceed.

Risks

• Delay in or failure to consummate the Merger or other described transactions.
• Possibility that parties may terminate certain transactions or change terms.
• Inability to consummate 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 businesses, retain/hire key personnel, and maintain favorable business relationships.
• Integration of parties may be more difficult, time-consuming, or costly than expected, or operating costs and business disruptions may be greater than expected.
• Inability to obtain regulatory and other approvals required to consummate the Transactions, including from Nasdaq.
• Volatility in the price of securities due to various factors.
• Changes in laws, regulations, technologies, global supply chain, and macro-economic/social environments affecting the business.
• Inability to maintain compliance with Nasdaq rules and listing of securities on Nasdaq.
• Inability to successfully integrate businesses and technologies, potentially leading to less effective and efficient combined operations.
• Risk that expected benefits and synergies may not be fully achieved in a timely manner, or at all.
• Failure to obtain shareholder approval or conditions to the transaction not being satisfied on a timely basis or at all.
• Failure of the transaction to close for any other reason or to close on anticipated terms.
• Regulatory approval, consent, or authorization not obtained or obtained with unanticipated conditions.
• Occurrence of any event, change, or circumstance that could give rise to termination of the proposed transaction.
• Unanticipated difficulties, liabilities, or expenditures relating to the transaction.
• Effect of announcement/pendency/completion on business relationships and operations.
• Effect of announcement or pendency on Workhorse common stock prices and uncertainty of long-term value of the combined company's common stock.
• Risks that the proposed transaction disrupts current plans and operations and potential difficulties in hiring or retaining employees.
• Ability to develop and manufacture 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.
• 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.
• 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 we do business.
• Supply chain disruptions, including constraints on steel, semiconductors and other material inputs and resulting cost increases impacting us, our customers, our 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 our production process to fulfill product orders.
• General inability to raise additional capital to fund our operations and business plan.
• Ability to receive sufficient proceeds from our current and any future financing arrangements to meet our 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 we have taken, including reverse splits of our common stock, on our operations, stock price and future access to funds.
• Ability to protect our intellectual property.
• Market acceptance of our products.
• Ability to obtain sufficient liquidity from operations and financing activities to continue as a going concern and, our ability to control our expenses.
• The effectiveness of our cost control measures and impact such measures could have on our 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 our competitors.
• Our inability to retain key members of our management team.
• Our inability to satisfy our customer warranty claims.
• The outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc.
• Our ability to realize the benefits of the sale and leaseback transaction of our Union City Facility.

Future Outlook

The combined company is positioned to become a category leader in the medium-duty EV market, aiming for rapid innovation and scalable growth. Management anticipates strengthening the financial foundation, expanding margins, and gaining flexibility for future growth initiatives and capital raises post-merger. The transaction is expected to achieve at least $20 million in cost synergies by the end of 2026.

Management Comments

• "By voting FOR the transaction with Motiv, Workhorse shareholders will have the opportunity to participate in the upside of the combined company."
• "Building on our complementary strengths, Workhorse and Motiv are positioned to win the medium-duty EV market and create long-term shareholder value."
• "We expect the transaction will strengthen the company's financial position and create opportunities for margin expansion, enabling greater flexibility to pursue future growth initiatives, and raise additional capital post close."
• "We strongly believe this transaction is the only viable path forward for Workhorse."
• "Voting against the proposals could cause Workhorse to pursue a standalone path, including a potential restructuring that would likely result in your Workhorse investment having little or no value."
• "Help us capture long-term growth opportunities for the combined company and deliver shareholder value creation by voting FOR all of the proposals."
• "Every vote counts – vote FOR the Workhorse-Motiv transaction today!"

Industry Context

The proposed merger positions the combined entity to more effectively compete in the rapidly evolving medium-duty electric vehicle market. By combining complementary strengths and aiming for significant cost synergies, Workhorse and Motiv seek to gain a competitive advantage against both pure-play electric and legacy OEM competitors, particularly by offering a more cost-effective electric solution on a Total Cost of Ownership (TCO) basis. This move reflects a broader industry trend towards consolidation and strategic partnerships to achieve scale, reduce costs, and accelerate innovation in the EV sector.

Comparison to Industry Standards

• The combined company aims to compete more effectively with the industry's pure-play electric and legacy OEMs, suggesting a current competitive gap that the merger intends to close.
• The goal of achieving a more competitively advantaged electric offering than gas/diesel trucks and buses on a TCO basis indicates a focus on a key industry metric for fleet adoption, where electric vehicles often struggle with higher upfront costs despite lower operating expenses.
• The combined entity has served 10 of the largest medium-duty fleets in North America, which is a strong indicator of market penetration and customer relationships compared to emerging EV players.

Legal Proceedings

• Outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc. (mentioned as a risk factor).

Stakeholder Impact

• Shareholders: Opportunity to participate in the upside of the combined company; risk of investment having little or no value if merger fails; urged to vote FOR all proposals.
• Employees: Potential difficulties in hiring or retaining employees as a result of the proposed transaction (risk factor); potential impact of cost control measures including employee furloughs (risk factor).
• Customers: Combined company to serve 10 largest medium-duty fleets; ability to attract and retain customers for existing and new products (risk factor); ability to satisfy customer warranty claims (risk factor).
• Suppliers: Supply chain disruptions, including constraints on steel, semiconductors and other material inputs and resulting cost increases impacting suppliers (risk factor).

Next Steps

• Shareholders are required to vote FOR all proposals in connection with Workhorse's Annual Meeting.
• The Annual Meeting is scheduled for November 12, 2025.
• Shareholders can vote by proxy card, online, or by phone.
• Workhorse will continue to work towards consummating the merger with Motiv Power Systems, Inc.

Key Dates

Recommendation

Management explicitly states that the merger with Motiv is the 'only viable path forward' for Workhorse, and voting against it would 'likely result in your Workhorse investment having little or no value.' The proposed transaction offers significant potential for creating a category leader, achieving at least $20 million in cost synergies, strengthening the financial foundation, and enabling future growth. Given the stark choice presented and the substantial upside outlined for the combined entity, a seasoned investor would view supporting this merger as critical for the company's survival and long-term value creation, thus warranting a strong buy recommendation on the premise of the merger's successful completion.

Keywords

Workhorse Group, Motiv Power Systems, Merger, Electric Vehicles, Medium-Duty EV, Shareholder Vote, Proxy Solicitation, EV Manufacturing, Fleet Electrification, Cost Synergies