Workhorse Secures Up to $100M Loan Facility

TL;DR

Workhorse just locked down a $100M loan from PIMCO affiliate to fund operations. Big liquidity boost.

AI Summary

On May 10, 2024, Workhorse Group Inc. entered into a Material Definitive Agreement, specifically a loan agreement with an affiliate of PIMCO, for up to $100 million. This agreement creates a direct financial obligation for Workhorse Group Inc. and is intended to provide additional liquidity to support its operations and strategic initiatives.

Why It Matters

This significant financing provides Workhorse Group Inc. with crucial capital to continue its operations and pursue its strategic goals, potentially impacting its ability to meet production targets and market demand.

Risk Assessment

Risk Level: medium — While the loan provides needed capital, the company's operational and financial performance remains a key factor in its long-term success.

Key Numbers

• $100.0M — Loan Facility (Amount available to Workhorse Group Inc. from PIMCO affiliate)

Key Players & Entities

• Workhorse Group Inc. (company) — Registrant
• PIMCO (company) — Lender's affiliate
• $100 million (dollar_amount) — Loan facility amount
• May 10, 2024 (date) — Date of agreement

FAQ

Key Financial Figures

• $0.001 — nge on which registered Common Stock, $0.001 par value per share WKHS The Nasdaq
• $139,000,000 — up to an aggregate principal amount of $139,000,000 (the "Notes") that will be convertible
• $6,285,714 — ote in the original principal amount of $6,285,714 (the "First Additional Note") and (ii)
• $9,000,000 — a Note in original principal amount of $9,000,000 (the "Initial Note") and (ii) a Warrant
• $123,714,286 — ntemplates additional closings of up to $123,714,286 in aggregate principal amount of additi
• $5,500,000 — l issue discount of 12.5%, resulting in $5,500,000 of proceeds to the Company before fees
• $0.1367 — conversion price equal to the lower of $0.1367 (the "Reference Price") or (b) the grea
• $0.0420 — rence Price") or (b) the greater of (x) $0.0420 (the "Floor Price") and (y) 87.5% of th
• $1,500,000 — cal quarter in the amount of either (i) $1,500,000 if the sale leaseback transaction of Co
• $4,000,000 — ack") has not been consummated and (ii) $4,000,000 if the Sale Leaseback has been consumma
• $0.2943 — k under the First Additional Warrant is $0.2943. Like the Initial Warrant, the First Ad
• $34.5 m — ore fees and expenses, of approximately $34.5 million, in connection with which the Com
• $300,000 — ghs to provide savings of approximately $300,000 per month and has not incurred, and doe
• $375,000 — to provide it savings of approximately $375,000 per month. In addition, the Company exp
• $4 million — Company in the amount of approximately $4 million. The Company is currently in negotiatio

Filing Documents

• ea0205706-8k_workhorse.htm (8-K) — 62KB
• ea020570601ex10-4_workhorse.htm (EX-10.4) — 80KB
• 0001213900-24-041465.txt ( ) — 340KB
• wkhs-20240510.xsd (EX-101.SCH) — 3KB
• wkhs-20240510_lab.xml (EX-101.LAB) — 33KB
• wkhs-20240510_pre.xml (EX-101.PRE) — 22KB
• ea0205706-8k_workhorse_htm.xml (XML) — 4KB

01

Item 1.01. Entry into a Material Definitive Agreement. Securities Purchase Agreement As previously disclosed, on March 15, 2024, Workhorse Group Inc. (the "Company") entered into a securities purchase agreement (the "Securities Purchase Agreement") with an institutional investor (the "Investor") under which the Company agreed to issue and sell, in one or more registered public offerings by the Company directly to the Investor, (i) senior secured convertible notes for up to an aggregate principal amount of $139,000,000 (the "Notes") that will be convertible into shares of the Company's common stock, par value of $0.001 per share (the "Common Stock") and (ii) warrants (the "Warrants") to purchase shares of Common Stock in multiple tranches over a period beginning on March 15, 2024. Pursuant to the Securities Purchase Agreement, on May 10, 2024, the Company issued and sold to the Investor a (i) Note in the original principal amount of $6,285,714 (the "First Additional Note") and (ii) Warrant to purchase up to 36,785,453 shares of Common Stock (the "First Additional Warrant"). Refer to the Company's Current Report on Form 8-K filed on March 15, 2024 for additional information related to the Securities Purchase Agreement, the Notes, and the Warrants. The First Additional Note was issued pursuant to the Company's Indenture between the Company and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), dated December 27, 2023 (the "Base Indenture"), and a Third Supplemental Indenture to be entered into between the Company and the Trustee (together with the Base Indenture, the "Indenture"). As previously disclosed, on March 15, 2024, the Company issued and sold to the Investor (i) a Note in original principal amount of $9,000,000 (the "Initial Note") and (ii) a Warrant to purchase up to 31,992,890 shares of Common Stock (the "Initial Warrant") pursuant to the Securities Purchase Agreement and a prospectus supplement filed on March 15, 2024. As of th

Forward-Looking Statements

Forward-Looking Statements Certain statements contained in this Form 8-K, other than purely historical information, including, but not limited to, estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, contain forward-looking statements reflecting our current expectations that involve risks and uncertainties. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. When used in this prospectus supplement, the words "anticipate," "expect," "plan," "believe," "seek," "estimate" and similar expressions are intended to identify forward-looking statements. These are statements that relate to future periods and include, but are not limited to, statements about the features, benefits and performance of our products, our ability to introduce new product offerings and increase revenue from existing products, expected expenses including those related to selling and marketing, product development and general and administrative, our beliefs regarding the health and growth of the market for our products, anticipated increase in our customer base, expansion of our products functionalities, expected revenue levels and sources of revenue, expected impact, if any, of legal proceedings, the adequacy of our liquidity and capital resources, the likelihood of us obtaining additional financing in the immediate future and the expected terms of such financing, and expected growth in business. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements contained in this Report. Factors that could cause actual results to differ materially include, but are not limited to: our ability to develop and manufacture our new product portfolio, inclu

01. Exhibits

Item 9.01. Exhibits. Exhibit No. Description 10.4 Form of Third Supplemental Indenture. 104 Cover page from this Current Report on Form 8-K, formatted as Inline XBRL. 5

SIGNATURES

SIGNATURES 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. WORKHORSE GROUP INC. Date: May 10, 2024 By: /s/ James D. Harrington Name: Title: James D. Harrington General Counsel, Chief Compliance Officer and Secretary 6

View Full Filing

View this 8-K filing on SEC EDGAR