Phoenix Motor (PEV) Sells Unregistered Equity, Raises Capital

TL;DR

**PEV just sold new shares, diluting existing stock but raising cash.**

AI Summary

Phoenix Motor Inc. (PEV) filed an 8-K on February 2, 2024, reporting a material definitive agreement and unregistered sales of equity securities that occurred on January 29, 2024. This filing indicates that the company is raising capital through the issuance of new shares, which could dilute the ownership stake of existing shareholders. For investors, this matters because while it provides the company with necessary funds, it also increases the total number of shares outstanding, potentially impacting the stock's per-share value.

Why It Matters

This filing signals Phoenix Motor is securing capital, which is crucial for operations, but the issuance of new shares could dilute existing shareholder value.

Risk Assessment

Risk Level: medium — The issuance of unregistered equity securities can lead to dilution for current shareholders, posing a medium risk to their investment value.

Analyst Insight

A smart investor would monitor subsequent filings for details on the terms of the material definitive agreement and the specifics of the unregistered equity sales to assess the full impact of dilution and the company's financial health.

Key Numbers

• $0.0004 — Par Value per Share (The stated par value of Phoenix Motor Inc.'s common stock.)

Key Players & Entities

• Phoenix Motor Inc. (company) — the registrant filing the 8-K
• January 29, 2024 (date) — date of earliest event reported
• February 2, 2024 (date) — date the 8-K was filed
• PEV (company) — trading symbol for Phoenix Motor Inc.
• NASDAQ Capital Market (company) — exchange where PEV common stock is registered
• $0.0004 (dollar_amount) — par value per share of common stock

Forward-Looking Statements

• Phoenix Motor Inc. will likely use the capital raised from the unregistered equity sales to fund ongoing operations or strategic initiatives. (Phoenix Motor Inc.) — medium confidence, target: 2024-12-31
• The stock price of PEV may experience short-term volatility due to the dilution effect of the new share issuance. (PEV) — medium confidence, target: 2024-03-31

FAQ

Key Financial Figures

• $0.0004 — ch registered Common Stock, par value $0.0004 per share PEV NASDAQ Capital Market
• $1.15 — offered at a combined offering price of $1.15. Each Warrant is exercisable for one s
• $2.00 — rants have an initial exercise price of $2.00 per share and are exercisable at any ti
• $4.8 m — ds from the Offering were approximately $4.8 million, before offering expenses. The Co

Filing Documents

• tm245100d1_8k.htm (8-K) — 33KB
• tm245100d1_ex4-1.htm (EX-4.1) — 77KB
• tm245100d1_ex5-1.htm (EX-5.1) — 9KB
• tm245100d1_ex10-1.htm (EX-10.1) — 150KB
• tm245100d1_ex99-1.htm (EX-99.1) — 9KB
• tm245100d1_ex5-1img001.jpg (GRAPHIC) — 5KB
• 0001104659-24-010174.txt ( ) — 518KB
• pev-20240129.xsd (EX-101.SCH) — 3KB
• pev-20240129_lab.xml (EX-101.LAB) — 33KB
• pev-20240129_pre.xml (EX-101.PRE) — 22KB
• tm245100d1_8k_htm.xml (XML) — 4KB

01. Entry into Material Definitive Agreement

Item 1.01. Entry into Material Definitive Agreement Phoenix Motor Inc. (the "Company") entered into a Securities Purchase Agreement dated January 29, 2024 (the "Purchase Agreement") with certain accredited investors (the "Investors"), to issue and sell in a registered direct offering (the "RD Offering") an aggregate of 4,196,370 shares of the Company's common stock (the "Common Stock"). The Purchase Agreement also provides that the Company will issue to the Investors warrants (the "Warrants") to purchase up to 4,196,370 shares of Common Stock (the "Warrant Shares") in a concurrent private placement (the "Private Offering" and, together with the RD Offering, the "Offering"). The Common Stock and accompanying Warrants were offered at a combined offering price of $1.15. Each Warrant is exercisable for one share of Common Stock. The Warrants have an initial exercise price of $2.00 per share and are exercisable at any time on or after the date of issuance and will expire on the fifth anniversary of the date on which the Warrants were issued. The Warrants and the Warrant Shares issuable upon the exercise of such Warrants are not being registered under the Securities Act of 1933, as amended (the "Securities Act"), and are being offered pursuant to the exemption provided in Section 4(a)(2) under the Securities Act. The Company has agreed to file a registration statement (the "Resale Registration Statement") on Form S-1 or Form S-3 to register the resale of the Warrant Shares and to use its commercially reasonable efforts to obtain effectiveness of the Resale Registration Statement within 45 days (or 90 days in the event the Securities and Exchange Commission (the "SEC") elects to review the Resale Registration Statement) following the filing date of the Resale Registration Statement. The proceeds from the Offering were approximately $4.8 million, before offering expenses. The Company intends to use the net proceeds received from the Offering for general working capital

02. Unregistered Sales of Equity Securities

Item 3.02. Unregistered Sales of Equity Securities The disclosures in Item 1.01 of this Current Report on Form 8-K related to the Private Offering and the issuance of the Warrants and the Warrant Shares issuable upon the exercise of the Warrants are incorporated by reference into this Item 3.02. The Warrants and the Warrant Shares described in this Current Report on Form 8-K have not been registered under the Securities Act, and were offered and sold in reliance upon exemption from the registration requirements under Section 4(a)(2) under the Securities Act and/or Regulation D promulgated thereunder.

01. Other Events

Item 8.01. Other Events On January 30, 2024, the Company issued a press release announcing the Offering, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference.

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (d) Exhibits The following exhibit is filed herewith: Exhibit Number Description 4.1 Form of Warrant 5.1 Opinion of Loeb & Loeb LLP 10.1 Form of Securities Purchase Agreement 23.1 Consent of Loeb & Loeb LLP (included in Exhibit 5.1) 99.1 Press Release dated January 30, 2024 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: February 2, 2024 PHOENIX MOTOR INC. By: /s/ Chris Wang Name: Chris Wang Title: Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR