WORKHORSE GROUP INC. (NASDAQ:WKHS) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry Into a Material Definitive Agreement

On December 26, 2017, Workhorse Group Inc. (the “Company”) announced its plans to spin-off SureFly, Inc., a Delaware company and indirect wholly-owned subsidiary of the Company (“SureFly”) which encompasses the Company’s aviation division into a separate publicly traded company. The Company intends to retain a portion of the ownership of SureFly following the completion of the spin-off. The press release regarding the spin-off of SureFly is attached hereto as Exhibit 99.1 and incorporated herein by reference.

In addition, on December 26, 2017, as part of its initial efforts to spin-off SureFly, the Company entered into a Securities Purchase Agreement with several existing institutional investors (the “Spin-Off Investors”) to which the company issued original issue discount Senior Secured Notes (the “Notes”) in the aggregate principal amount of $5,750,000 in consideration of gross proceeds of $5,000,000 paid by the Spin-Off Investors.

The Notes do not bear interest and mature on June 30, 2018. Workhorse Technologies Inc., an Ohio company and a wholly-owned subsidiary of the company (“WTI”) and SureFly entered into a Guaranty with the Spin-Off Investors, SureFly entered into a Pledge and Security Agreement with the Spin-Off Investors and WTI entered into a Pledge Agreement with the Spin-Off Investors.

The Spin-Off Investors have the right but not the obligation to convert the Notes into Series A Preferred Stock of SureFly at a pre-money valuation of $33,000,000 and warrants to purchase a number of shares of common stock equal to 30% of the number of shares of common stock underlying the Series A Preferred Stock at an exercise price equal to 125% of the conversion price of the Series A Preferred Stock.

The issuance of the Notes is being made in reliance upon an exemption from registration provided under Section 4(a)(2) of the Securities Act of 1933, as amended.

The above descriptions of the agreements and the Notes are qualified in their entirety by reference to the forms attached hereto as exhibits.

Forward-Looking Statements

This report includes forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by words such as “believes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “should,” “seeks,” “future,” “continue,” or the negative of such terms, or other comparable terminology. 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 herein. Factors that could cause actual results to differ materially include, but are not limited to: our limited operations and need to expand in the near future to fulfill product orders; risks associated with obtaining orders and executing upon such orders; the ability to protect our intellectual property; the potential lack of market acceptance of our products; potential competition; our inability to retain key members of our management team; our inability to raise additional capital to fund our operations and business plan; our inability to maintain our listing of our securities on the Nasdaq Capital Market; our ability to continue as a going concern; our liquidity and other risks and uncertainties and other factors discussed from time to time in our filings with the Securities and Exchange Commission (“SEC”), including our annual report on Form 10-K filed with the SEC. Workhorse expressly disclaims any obligation to publicly update any forward-looking statements contained herein, whether as a result of new information, future events or otherwise, except as required by law.

Workhorse Group Inc. Exhibit
EX-4.1 2 f8k122617ex4-1_workhorse.htm FORM OF SENIOR SECURED NOTE DATED DECEMBER 26,…
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About WORKHORSE GROUP INC. (NASDAQ:WKHS)

Workhorse Group, Inc., formerly AMP Holding Inc., is a development-stage company. The Company designs, develops, manufactures and sells medium-duty trucks with powertrain components under the Workhorse chassis brand. The Company’s products include trucks comprising powertrain and chassis. Its powertrain products include E-GEN and E-100. Its chassis products include W88, W22, W42 and W62. E-GEN is an electric drive, transmission-free system, which has a gasoline/propane or compressed natural gas (CNG) engine that functions as an auxiliary generator. E-100, an all-electric, medium-duty truck, is an electric power-train. It focuses on offering W88 chassis with gross vehicle weight (GVW) ratings of 10,000 to 26,000 pounds. The W22 chassis is designed to meet the needs of the recreational vehicle market for weight ratings till over 26,000 GVW. The W42 chassis is designed for the 12,000 to 14,500 GVW vehicle market. The W62 chassis is designed for the 19,500 to 23,500 GVW vehicle market.