WKHS 10-K & 10-Q changes, risk factors and insider trading
Workhorse Group Inc. · Nasdaq · Motor Vehicles & Passenger Car Bodies · CIK 1425287 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Summary of Risk Factors”
New heading “Below is a summary of the principal factors that make an investment in our Common Stock speculative or risky, which should be considered together with the more detailed discussion following this summary, together with other information in this Annual Report on Form 10-K. These risks include, but are not limited to, the following:”
New heading “Risks Related to the Merger”
New heading “Risks Related to our Business and Operations”
New heading “Risks Related to our Financing Arrangements”
New heading “Risks Related to Owning Our Common Stock”
New heading “Risks Related to the Merger”
New heading “The combined company may be unable to successfully integrate the businesses of Workhorse and Motiv in the expected time frame or at all.”
New heading “We have incurred, and expect to continue to incur, substantial costs as a result of the Merger.”
New heading “We may be unable to realize the anticipated benefits of the Merger.”
New heading “Lawsuits may be filed against us and the members of our Board of Directors arising out of the Merger, which may negatively affect our business and operations.”
New heading “We may not be successful in lowering our total bill of material costs for our vehicles to a level where we can be competitive with ICE vehicles.”
New heading “The Credit Agreements we entered into in connection with the closing of the Merger are secured by substantially all of our and our subsidiaries' assets. If we are unable to meet certain conditions precedent contained in the Credit Agreements, we may not be able to borrow under the agreements, which could materially and adversely affect our business and operations. Additionally, if there is an uncured event of default, MGMH, the lender, could foreclose on our assets, and we could lose ownership of those assets.”
New heading “The Credit Agreements contain various covenants that could place restrictions on our operating and financial flexibility and our level of indebtedness under the Credit Agreements could adversely affect our business, financial condition or results of operations.”
New heading “We are a “controlled company” under the Nasdaq listing standards and, as a result, we qualify for, and may in the future rely on, exemptions from certain governance requirements.”
Removed heading “Our limited operating history makes it difficult for us to evaluate our future business prospects and make decisions based on those estimates of our future performance.”
Removed heading “Continued disruption of supply, shortage of materials or increases in costs, in particular for battery packs could harm our business.”
Removed heading “We did not immediately receive the net proceeds from the Tenth Additional 2024 Note and may never receive certain of such proceeds. Any proceeds received pursuant to the 2024 Notes will be received only upon satisfaction of certain terms and conditions set forth in the Lockbox Letter.”
Removed heading “Provisions in our 2024 Notes and 2024 Warrants may deter or prevent a business combination that may be favorable to you.”
Removed heading “Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our business to pay our obligations under the 2024 Notes.”
Largest changes
“The Credit Agreements we entered into in connection with the closing of the Merger are secured by substantially all of our and our subsidiaries' assets. If we are unable to meet certain conditions precedent contained in the Credit Agreements, we may not be able to borrow under the agreements, which could materially and adversely affect our business and operations. Additionally, if there is an uncured event of default, MGMH, the lender, could foreclose on our assets, and we could lose ownership of those assets.”see in full comparison
“In connection with the closing of the Merger, we entered into the Customer Order Credit Agreement and the Cash Flow Credit Agreement, to provide for financing to fund vehicle manufacturing and working capital requirements, respectively. There are certain conditions precedent to MGMH’s obligation fund loans under the Credit Agreements. …”see in full comparison
“Putative stockholder complaints, including stockholder class action complaints, and other complaints may be filed against us, our Board of Directors and others in connection with the Merger. The outcome of litigation is uncertain, and we may not be successful in defending against any such future claims. Lawsuits that may be filed against us, our Board of Directors or others could divert the attention of our management and employees from our day-to-day business, and otherwise adversely affect our business, results of operations, and financial condition.”see in full comparison
Electric vehicle sales and production are cyclical and are materially affected by macroeconomic, geopolitical and industry conditions that are outside of our control and the control of our customers and suppliers, including the ongoing war in Ukraine, the war in Iran and tensions in the Middle East, monetary fiscal policy, economic recessions, inflation, deflation, interest rates, tariffs, political instability, labor relations issues, energy prices, regulatory requirements, government initiatives, capital and liquidity constraints, acts of war and terrorism, and natural and man-made disasters. Our operational costs are similarly impacted by such macroeconomic, geopolitical and industry conditions, which have and may continue to adversely impact our margins and profitability, such as the tariffs on imports from China, Canada, Mexico, Europe and elsewhere imposed following the inauguration of thesee in full comparisonnewcurrentPresidentialpresidentialAdministration,administration, which could have a significant impact on us, particularly our ability to source cost-efficient batteries for use in our trucks. Market disruptions, volatility in commodity prices and supply chain interruptions for equipment as a result of wars, geopolitical tensions, including any resulting sanctions, could also have an adverse impact on our operations and financial performance. Current or potential customers may delay or decrease spending on our products and services as their business and/or budgets are impacted by economicconditions.conditions including disruptions to credit and capital markets. The inability of current and potential customers to pay us for our products and services may adversely affect our earnings and cash flows. In addition, deterioration of conditions in worldwide credit markets could limit our ability to obtain financing to fund our operations and capital expenditures.
“•Regulatory requirements may have a negative impact upon our business. We may incur costs, expenses and penalties related to regulatory matters, governmental investigations, legal proceedings and other claims, which could have a material adverse effect on the Company's business, financial position, results of operations, cash flows or liquidity.”see in full comparison
“The Credit Agreements contain various covenants that could place restrictions on our operating and financial flexibility and our level of indebtedness under the Credit Agreements could adversely affect our business, financial condition or results of operations.”see in full comparison
Full comparison: every changed paragraph (129)
A description of the risks and uncertainties associated with our business is set forth below. You should carefully consider such risks and uncertainties, together with the other information contained in this Annual Report on Form 10-K, and in our other public filings. If any such risks and uncertainties actually occur, our business, financial condition or results of operations could differ materially from the plans, projections, and other forward-looking statements included elsewhere in this Annual Report on Form 10-K and in our other public filings. These risk factors are not the only risks we face. Our business could also be affected by additional risks and uncertainties not currently known to us or that we currently consider to be immaterial. In addition, if any of the following risks and uncertainties, or if any other risks and uncertainties, actually occur, our business, financial condition, or results of operations could be harmed substantially.
Summary of Risk Factors
Below is a summary of the principal factors that make an investment in our Common Stock speculative or risky, which should be considered together with the more detailed discussion following this summary, together with other information in this Annual Report on Form 10-K. These risks include, but are not limited to, the following:
Risks Related to the Merger
•The combined company may be unable to successfully integrate the businesses of Workhorse and Motiv in the expected time frame or at all. Additionally, we have incurred, and expect to continue to incur, substantial costs as a result of the Merger. We also may be unable to realize the anticipated benefits of the Merger.
Risks Related to our Business and Operations
•Substantial doubt exists regarding our ability to continue as a going concern through the twelve months following the date of the issuance of the Consolidated Financial Statements accompanying this Annual Report on Form 10-K.
•If we cannot generate or obtain additional capital, we may be unable to meet the needs of our current and prospective customers or to expand our operations.
•The unavailability, reduction, elimination or adverse application of government subsidies and incentives could have an adverse effect on our business, prospects, financial condition and operating results.
•Uncertain global macro-economic and political conditions could materially adversely affect our results of operations and financial condition and our business could be adversely affected by trade tariffs or other trade barriers.
•We cannot assure you that we will be successful in executing our business plan.
•We may not be successful in lowering our total bill of material costs for our vehicles to a level where we can be competitive with ICE vehicles.
•We may experience delays in launching and ramping up production or we may be unable to control our manufacturing costs.
•Our results of operations have not resulted in profitability and we may not be able to achieve profitability going forward.
•If our vehicles fail to perform as expected, our ability to develop, market and sell our electric vehicles could be harmed.
•The loss of any of our customers could materially harm our business.
•Regulatory requirements may have a negative impact upon our business. We may incur costs, expenses and penalties related to regulatory matters, governmental investigations, legal proceedings and other claims, which could have a material adverse effect on the Company's business, financial position, results of operations, cash flows or liquidity.
•We do not always receive progress payments on orders of our vehicles, and if a purchaser fails to pay upon delivery, we may not be able to recoup the costs we incurred in producing such vehicles.
•Our business, prospects, financial condition and operating results will be adversely affected if we cannot reduce and adequately control the costs and expenses associated with operating our business, including our material and production costs.
•The demand for commercial electric vehicles depends, in part, on the continuation of current trends resulting from dependence on fossil fuels.
•Our future growth depends on the willingness of operators of commercial vehicle fleets to adopt electric vehicles and on our ability to produce, sell and service vehicles that meet their needs. This often depends upon the cost for an operator adopting electric vehicle technology as compared to the cost of traditional internal combustion technology.
•If the market for commercial electric vehicles does not develop broadly and more quickly than it is currently developing, our business, prospects, financial condition and operating results will be adversely affected.
•We currently do not have and do not expect to have a significant number of long-term supply contracts with guaranteed pricing and substantial increases in these prices would increase our operating costs and could adversely affect our business, financial position, results of operations, cash flows or liquidity.
•If we are unable to scale our operations at our Union City, IN facility in an expedited manner from our limited low volume production to high volume production, our business, financial position, results of operations, cash flows and liquidity will be adversely affected.
•The loss of key personnel or the inability to attract additional personnel may adversely affect our business and results of operations.
•We face intense competition.
•Our electric vehicles compete for market share with vehicles powered by other vehicle technologies that may prove to be more attractive than ours. Changes in the market for electric vehicles could cause our products to become obsolete or lose popularity. We may be unable to keep up with changes in electric vehicle technology and, as a result, may suffer a decline in our business and competitive position.
•The failure of certain key suppliers to provide us with the necessary components of our products according to our schedule and at price, quality levels and volumes acceptable to us could have a severe and negative impact upon our business.
•Product liability or other claims could have a material adverse effect on our business.
•Our success may depend on protecting our intellectual property rights and we may be exposed to liability for infringing upon the intellectual property rights of other companies.
•Our electric vehicles make use of lithium-ion battery cells, which have occasionally been observed to catch fire or vent smoke and flames, which could subject us to liability and adverse publicity.
•Increasing scrutiny and changing requirements, attitudes or expectations with respect to our environmental, social, and governance (“ESG”) practices may impose additional costs on us or expose us to new or additional risks.
•We face risks associated with security breaches through cyber-attacks, cyber intrusions, or otherwise, which could pose a risk to our systems, networks and services.
Risks Related to our Financing Arrangements
•Our Credit Agreements are secured by substantially all of our and our subsidiaries' assets. We may not be able to borrow under the agreements. Additionally, if there is an uncured event of default, the lender could foreclose on our assets, and we could lose ownership of those assets. The Credit Agreements also contain various covenants that could place restrictions on our operating and financial flexibility and our level of indebtedness under the Credit Agreements could adversely affect our business, financial condition or results of operations.
Risks Related to Owning Our Common Stock
•We have identified a material weakness in our internal control over financial reporting and we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our business.
•Our stock price and trading volume may be volatile, which could result in substantial losses for our stockholders. Additionally, we have not paid cash dividends in the past and have no immediate plans to pay cash dividends.
•Stockholders may experience future dilution as a result of our existing and future financings.
•Our charter documents and Nevada law may inhibit a takeover that stockholders consider favorable.
Risk Factors
Risks Related to the Merger
The combined company may be unable to successfully integrate the businesses of Workhorse and Motiv in the expected time frame or at all.
The combination of two independent businesses is complex, costly, and time consuming, and we are devoting significant management time and resources to integrating the businesses and operations of the two companies. Challenges involved in this integration include, among others:
•combining the businesses of Workhorse and Motiv in a manner that permits the combined company to achieve the synergies, efficiencies, and growth opportunities anticipated to result from the Merger;
•retaining and integrating personnel;
•harmonizing each company's operating practices, employee development and compensation programs, internal controls and other policies, procedures, and processes;
•maintaining existing relationships with each company's customers, suppliers, and other partners and leveraging relationships with such third parties for the benefit of the combined company;
•addressing possible differences in business backgrounds, corporate cultures and management philosophies;
•consolidating each company's administrative and information technology infrastructure; and
•coordinating geographically dispersed organizations.
There can be no assurances that we will be able to successfully integrate Motiv’s business into the combined company within the anticipated time frame, or at all, and the benefits of the Merger may not be realized fully, or at all, or may take longer to realize than expected.
If key employees terminate their employment the combined company may have to incur significant costs in identifying, hiring, training, and retaining replacements for departing employees and may lose significant expertise and talent. In addition, if we are unable to retain personnel, including key management, who are critical to the future operations of the companies, we could face disruptions in our business. It is also possible that the integration process could result in our inability to maintain relationships with customers, suppliers, strategic partners and other business relationships, the disruption of our ongoing business, inconsistencies in standards, controls, policies and procedures, unexpected integration issues, and higher than expected integration costs.
We have incurred, and expect to continue to incur, substantial costs as a result of the Merger.
We have incurred a substantial amount of non-recurring costs associated with negotiating and completing the Merger, and will continue to incur integration costs in connection with the Merger. There are processes, policies, procedures, operations, technologies and systems that must be integrated in connection with the Merger and the integration of Motiv’s business into the combined company. The elimination of duplicative costs, strategic benefits and additional income, as well as any realization of other efficiencies related to the integration of the businesses, may not offset transaction and integration costs in the near term or at all. While we have assumed that certain expenses would be incurred in connection with the Merger and the other transactions contemplated by the Merger Agreement, there are many factors beyond our control that could affect the total amount or the timing of such expenses.
We may be unable to realize the anticipated benefits of the Merger.
Our ability to realize the anticipated benefits of the Merger in the time frame anticipated, or at all, is subject to a number of assumptions, which may or may not prove to be accurate, and other factors, many of which are beyond our control. Difficulties in successfully integrating the two businesses and managing the expanded operations of the combined company could result in increased costs, decreased revenue and the diversion of management's time, any of which could have a material adverse effect on the business, results of operation and financial condition of the combined company. Even if the two businesses are integrated successfully, the combined company may not fully realize the anticipated benefits of the Merger, including the anticipated cost savings, synergies and other efficiencies, that are currently expected. Moreover, some of the anticipated benefits are not expected to occur for a period of time following the consummation of the Merger and may involve unanticipated costs in order to be fully realized. If the combined company is not able to achieve these objectives and realize the anticipated benefits expected from the Merger within the anticipated time frame or at all, its business, results of operations and financial condition could be adversely affected, and the market price of our ordinary shares could be negatively impacted.
Lawsuits may be filed against us and the members of our Board of Directors arising out of the Merger, which may negatively affect our business and operations.
Putative stockholder complaints, including stockholder class action complaints, and other complaints may be filed against us, our Board of Directors and others in connection with the Merger. The outcome of litigation is uncertain, and we may not be successful in defending against any such future claims. Lawsuits that may be filed against us, our Board of Directors or others could divert the attention of our management and employees from our day-to-day business, and otherwise adversely affect our business, results of operations, and financial condition.
We have incurred net losses of $101.8$64.1 million and $123.9$51.6 million for the fiscal years ended December 31, 20242025 and December 31, 2023,2024, respectively. As a result of our recurring losses from operations, accumulated deficit, projected working capital needs and delays in bringing our vehicles to market, and, accordingly, slower market demand than previously expected, substantial doubt exists as to our ability to continue as a going concern over the twelve months from the date of the issuance of the audited financial statements accompanying this Form 10-K. Our ability to continue as a going concern depends on our ability to receive additional proceeds from our financing relationships,relationships includingor theobtain releasenew offinancing funds from the lockbox account in which proceeds of our most recent issuance of 2024 Notes under our 2024 Securities Purchase Agreement are held.arrangements. In addition, our ability to enter into new financing arrangements iscan significantlybe limited by the terms of our existing financing arrangements, including our 2024 Securities Purchase Agreement, as well as other factors, such as the so-called “baby shelf” rules under Form S-3. To the extent we are unable to satisfy these capital needs, we will need to significantly modify or terminate our operations and our planned business activities. The failure to obtain sufficient financing could adversely affect our ability to achieve our business objectives and continue as a going concern.
Management's Discussion & Analysis (MD&A)
New heading “On December 15, 2025 (the “Closing Date”), we completed our merger with Motiv Power Systems, Inc. (“Motiv”), pursuant to which Motiv became our indirect, wholly owned subsidiary (the “Merger”).”
New heading “Class 5/6 W56 Step Van and Stripped Chassis”
New heading “Class 5/6 Stripped Chassis”
New heading “Class 4 EPIC4 Shuttle Bus, School Bus, Box Truck, and Work Truck”
New heading “Product Roadmap”
New heading “Fleet Management”
New heading “Key Factors Affecting Operating Results”
New heading “Convertible Financing”
New heading “Impairment Loss on Discontinued Product Line Investment”
New heading “Change in fair value of stock rights”
New heading “Future Purchase Commitments”
New heading “Business Combinations”
New heading “Warranty Reserve”
Removed heading “2024 Securities Purchase Agreement”
Removed heading “Lincoln Park Capital Purchase Agreement”
Removed heading “Investment in Tropos Technologies, Inc”
Removed heading “Fair value adjustment (loss) on warrants”
Removed heading “Cash Requirements”
Removed heading “Fair Value of Warrant Liability”
Largest changes
“Further, a global economic recession, downturn or other adverse economic conditions, whether due to changes or uncertainties in trade policies, the imposition or proposed imposition of tariffs, export controls, threat of trade war, persistent inflation, political instability, global or regional conflicts or other geopolitical events, public health crises, interest rate increases or other central bank policy actions, government closures of banks and liquidity concerns at financial institutions, and other macroeconomic or geopolitical factors, may have an adverse impact on our business and …”see in full comparison
“Workhorse’s outstanding obligations under each Credit Agreement bear interest at a reference rate equal to the term Secured Overnight Financing Rate for a three-month tenor (“SOFR”) plus an applicable margin of 5.00%. If SOFR is unavailable pursuant to the terms of the Credit Agreements, the reference rate will be the prime rate of interest per annum last quoted by The Wall Street Journal, and the applicable margin will be 2.50% per annum. Workhorse’s obligations under the Credit Agreements mature on December 15, 2028. …”see in full comparison
“Inflation continues to impact our operations, resulting from both supply and demand imbalances as economies continue to face constraints as well as the impact on the availability and cost of energy and other commodities as a result of the ongoing war in Ukraine, the war in Iran, and other tensions in the Middle East. While inflation had moderated in 2025, to the extent inflation or interest rates rise, we would experience an impact on our business, resulting in higher input costs and increasing the cost of any financing the Company may undertake in the future.”see in full comparison
“Inflation continues to impact our operations, resulting from both supply and demand imbalances as economies continue to face constraints as well as the impact on the availability and cost of energy and other commodities as a result of the ongoing conflicts in Ukraine and the Middle East. We are seeing a near-term impact on our business due to inflationary pressure. In an effort to dampen inflationary pressures, certain central banks raised interest rates, which has, and will likely continue to raise the cost of our financing.”see in full comparison
“Impairment Loss on Discontinued Product Line Investment”see in full comparison
“We continue to develop relationships with suppliers of key parts, components and raw materials to be used in the manufacture of our products such as batteries, electronics, and truck chassis that are sourced from suppliers across the world. As we continue to execute on our new truck programs, we will continue to identify supplier relationships and truck program synergies which may allow us to take advantage of pricing efficiencies from economies of scale. …”see in full comparison
Full comparison: every changed paragraph (131)
The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and the relatedaccompanying notes included elsewhere in this Annual Report on Form 10-K.Report.
On December 15, 2025 (the “Closing Date”), we completed our merger with Motiv Power Systems, Inc. (“Motiv”), pursuant to which Motiv became our indirect, wholly owned subsidiary (the “Merger”).
While the legal acquirer in the Merger was Workhorse for financial accounting and reporting purposes under U.S. GAAP, Motiv was the accounting acquirer and the Merger was accounted for as a reverse acquisition. Accordingly, the consolidated assets, liabilities and results of operations of Motiv became the historical consolidated financial statements of the consolidated company, and Workhorse’s assets, liabilities and results of operations were consolidated with those of Motiv beginning on the Merger (and acquisition date). Operations prior to the Merger are presented as those of Motiv in this and future reports. Workhorse’s assets and liabilities were measured and recognized at their fair values as of the Closing Date of the Merger. References to “Workhorse”, the “Company”, “we”, “us”, or “our”, when used in this Annual Report incorporate the operations of Motiv unless otherwise indicated or the context requires otherwise.
WeWorkhorse areGroup anInc. (“Workhorse”, the “Company”, “we”, “us”, or “our”) is a North American technologymanufacturer companyof withmedium-duty aelectric visiontrucks toand pioneer the transition to zero-emission commercial vehicles.buses. Our primary focus is to provide sustainable and cost-effective solutions to the commercial transportation sector. We design and manufacture all-electric vehicles, including the technology that optimizes the way that these vehicles operate. WeThe Company’s best-in-class vehicles are focuseddesigned onfor ourlast-mile coredelivery, competencymedium-duty operations, and a growing range of bringingspecialized our electric delivery vehicle platforms to serve the "last mile delivery" market.applications.
•Improved profitability through lower maintenance costs and reduced fuel expenses; and
•Increased package deliveries per day through use of more efficient delivery methods;
•Decreased vehicle emissions and reduced carbon footprint; andfootprint.
•Improved vehicle safety and operator experience.
We continue to seek opportunities to grow the business organically, and by expanding relationships with existing and new customers.customers and dealers. We believe we are well positioned to take advantage of long-term opportunities and continue our efforts to bring product innovations to market.
Primarily focused on meeting the needs of the medium duty trucking market, which we believe to be an approximately $23 billion market, we develop, manufacture and deploy electric vehicles for businesses and assist fleets through electrification pilot programs, multi-depot deployments and EV orders. We differentiate ourself in the market with an emphasis on customer support, training and services, resulting in more than half of our vehicle deliveries in 2025 being made to repeat customers.
We currently manufacture Class 5/6 commercial delivery vehicles in our production facility in Union City, IN. For our other vehicles, we currently use asset-light contract manufacturers and co-development partnerships that result in flexible, scalable product development and production. To date, the Company has developed a product portfolio that addresses the entire Class 4-6 medium duty trucking market. We are committed to making continued progress in our product development by enhancing our products and developing the next evolution of our offerings. We also offer several options to upfit our customers’ vehicles and fleets to increase the range of electrification options. We expect to transition away from contract manufacturers and shift production of all vehicles into the Workhorse production facility during 2026.
We currently manufacture and sell the following:
Class 5/6 W56 Step Van and Stripped Chassis
The W56 versatile platform is based on long-standing Company know-how in the Class 5/6 truck chassis market, a robust medium-duty chassis, designed for last-mile delivery and high payload work-truck applications. Initially the W56 is delivered in either a stripped chassis or complete step van configuration. The W56 platform provides a robust foundation for custom body builds, from delivery vans and utility vehicles to specialized vehicles. With its strong, configurable frame, the W56 is designed for safety and efficiency, and tailored to meet customer demands.
Class 5/6 Stripped Chassis
We currently offer the legacy Motiv 6th generation electrified chassis, “S,” which has step van and specialty applications. Work truck or box truck upfits to this platform enhance flexibility to meet customer demands. The legacy Motiv model of the Class 5/6 stripped chassis is going to be sunset over the next 12 months as we transition customers to the W56 platform.
Class 4 EPIC4 Shuttle Bus, School Bus, Box Truck, and Work Truck
Our Class 4 cab chassis called “Epic 4” can be used for shuttle, school, box, refrigeration, work truck, flat bed and specialty applications. Our shuttle bus upfitting can accommodate shuttle buses for 12+2 passengers and school bus upfitting can accommodate school buses for up to 20 passengers.
Product Roadmap
We have plans to continue to reduce the total cost of and enhance the design and performance of our current product lineup, as well design new vehicles as the market evolves. We intend to develop a proprietary Class 5/6 cab chassis and expect that this product will be able to be used for dry box, refrigeration, stake bed, utility and shuttle purposes.
Fleet Management
In April 2025, the Company launched the Motiv Premier Partner Network (MPPN), a carefully vetted commercial fleet resource consisting of some of the industry-leading solution providers available to support fleets at any stage of their journey to net-zero emissions. MPPN offerings and expertise focus on helping fleets minimize charging infrastructure costs, improve operational efficiencies and take advantage of incentive and financing programs.
In 2024, we continued to focus on product quality, manufacturing capacity, operational planning, engineering and design to enable increased deliveries and deployments of our products and future revenue growth. We have executed our strategic product roadmap for our electric vehicle offerings, including the production of the W4 CC, W56 and the development of the W56 208-inch wheelbase vehicle program in both strip chassis and step van variants. We continued to electrify the fleet of vehicles being used in our Stables by Workhorse initiative, which operates FedEx Ground delivery routes in the greater Cincinnati, OH area. The electrification of the fleet provides us with firsthand data on the benefits and challenges of independent fleet operators experience while executing last-mile delivery operations. The initiative also provides valuable insights into how our customers can plan for and manage the transition to EV operations, including how to develop adequate charging infrastructure, training and maintenance services. We intend to continue to generate demand and brand awareness by improving our vehicles’ performance and functionality, and by developing new vehicle programs, including new W56 variants. We expect to continue to benefit from ongoing electrification of the commercial vehicle market and in particular the "last mile delivery" sector.
During 2024,2025, we continued to expanddevelop our network of Workhorse certified dealers trained to safely repair and maintain the electric components of our vehicles into new states to support our customers. This program allows us to establish a comprehensive training program enabling dealers to safely assist customers with vehicle maintenance in addition to providing strategies for vehicle deployment into their fleets. To ensure high quality vehicle maintenance, Workhorse certified dealers have also made investments in electric vehicle charging infrastructure, tooling, and building out spare parts inventory. The program is designed to provide a strong foundation of safety and reliability in our vehicles for both our dealers and end customers. Our California dealers are eligible to participate in the CARB HVIP following our approval by CARB to participate as an intermediate-stage manufacturer.
On October 15, 2024 our 208-inch extended wheelbase version of the W56 step van was certified to meet full Federal Motor Vehicle Safety Standards (FMVSS) and received California's HVIP certification. We believe these certifications not only validate the vehicle's safety and environmental compliance but also underscore our capability of providing reliable solutions for the electric commercial vehicle market.
During 2024,2025, our vehicles continued to meet full Federal Motor Vehicle Safety Standards (FMVSS) to be eligible for several state and federal voucher and tax credit incentive programs supporting the sale of our EV products. All of our MY 2023/2024 Class 4 - 6 vehicles received approval under each state’s voucher incentive program with voucher amounts ranging from $60,000 - $125,000 for eligible vehicles. We also received approval for the W56 – 208 step van to participate in the HVIP program in late 2024 and, as such, all Workhorse vehicles are now eligible for the program.
WeIn also2024, Workhorse received Internal Revenue Service ("IRS") approval as a qualified manufacturer for the Commercial Clean Vehicle Credit as defined in 30D(d)(3) of the Internal Revenue Code. With this approval, Workhorse customers are eligible to receive up to a $40,000 credit for deliveriesAs of allSeptember Workhorse30, vehicles2025, inthe 2024IRS andis beyond.no longer offering the Commercial Clean Vehicle Credit.
On February 26, 2025, we completed registration as a foreign manufacturer under Transport Canada’s Appendix G pre-clearance program, and received approval for Canadian import dealers to bring Workhorse W56 and W750 step vans into the country and sell them nationwide. As part of the process, Transport Canada completed a review of the Company’s documentation validating Canadian Motor Vehicle Safety Standards (CMVSS) compliance of both vehicles.compliance.
We believe these certifications not only validate the vehicle's safety and environmental compliance but also underscore our capability of providing reliable solutions for the electric commercial vehicle market.
We operate a series of FedEx Ground delivery routes in the greater Cincinnati, OH area under an initiative known as Stables by Workhorse. Throughout 2024,2025, we continued to electrify the fleet of vehicles being used in our Stables by Workhorse initiative. The electrification of the fleet provides us with firsthand data on the benefits and challenges of independent fleet operators experience while executing last-mile delivery operations. The initiative also provides valuable insights into how our customers can plan for and manage the transition to EV operations, including how to develop adequate charging infrastructure, training and maintenance services. We expect to continue to benefit from ongoing insights gained from the electrification of the commercial vehicle market and in particular last mile delivery sector.
We continue to experience slower-than-anticipated industry wide electric truck adoption rates and lack of government subsidies and incentives available to our dealers as well as slower than expected roll-out of additional power to electric grids and the resulting effect on roll-outs of electric truck charging infrastructure, nationwide. Delayed governmental approvals in certain states and slower than expected proliferation of charging stations across the country have also adversely impacted demand. We expect these delays and the current and developing regulatory landscape in the United States to continue to slow adoption in 2026. The dynamic regulatory landscape is a significant consideration for our operations and strategic planning and remains uncertain. Proposed changes to California’s Hybrid and Zero-Emission Truck and Bus Voucher Incentive Program (“HVIP”) could negatively impact demand, if implemented. The removal of the Federal 45W tax-rebate for commercial vehicles may also impact a small percentage of customers. Weighing against these real and potential additional headwinds are the introduction of new incentive programs in some states as well as increased incentives in New York’s, New York Truck Voucher Incentive Program (“NYTVIP”) and Washington State's Zero-Emission Incentive Program ("WAZIP").
Commodities
Commodity prices remain volatile, and we expect continued cost increases for key materials used in electric truck production, including lithium, cobalt, nickel, steel, and aluminum. Global shifts in supply and demand have caused uneven price trends across commodities, but overall we anticipate higher material costs. In addition, tariff measures and trade policy under the presidential administration have raised the cost of imported automotive parts and raw materials. The current U.S. trade policy, including tariffs, is dynamic, and we are actively monitoring developments and evaluating potential impacts on our supply chain, production costs, and pricing strategies, in addition to the impacts that the war in Iran is having on commodity prices as a result of rising energy costs and supply and supply chain disruptions.
Supply Chain
We continue to develop relationships with suppliers of key parts, components and raw materials to be used in the manufacture of our products such as batteries, electronics, and truck chassis that are sourced from suppliers across the world. As we continue to execute on our new truck programs, we will continue to identify supplier relationships and truck program synergies which may allow us to take advantage of pricing efficiencies from economies of scale. Where available, we will utilize multiple supply sources for key parts, and we will work to qualify multiple supply sources to achieve pricing efficiencies and minimize potential production risks related to supply chain. As previously disclosed, we are currently working with certain of our vendors to extend or restructure the payment terms of past due accounts payable balances. We are also currently in litigation with one of our battery suppliers, Coulomb Solutions Inc. For more information concerning this matter, see Note 16, Commitments and Contingencies, in the notes to the accompanying Consolidated Financial Statements.
Inflation continues to impact our operations, resulting from both supply and demand imbalances as economies continue to face constraints as well as the impact on the availability and cost of energy and other commodities as a result of the ongoing war in Ukraine, the war in Iran, and other tensions in the Middle East. While inflation had moderated in 2025, to the extent inflation or interest rates rise, we would experience an impact on our business, resulting in higher input costs and increasing the cost of any financing the Company may undertake in the future.
Geopolitical
Our operations and results may be impacted due to uncertainty of the political environment and the current presidential administration. The administration’s policies have negatively affected support for the adoption of electric trucks, as well as the availability of government subsidies to fund the adoption of electric trucks and has implemented additional tariffs on imports that affect us and our industry. In addition, recent U.S. Supreme Court decisions that purport to limit the authority of federal executive agencies, including the EPA, may affect our industry in ways we cannot yet predict.
Key Factors Affecting Operating Results
We believe that our performance and future success depend on several factors that present significant opportunities for us but, also pose risks and challenges, including those below and in Item 1A. “Risk Factors” included elsewhere in this Annual Report on Form 10-K.
Our ability to grow revenues and expand margins will depend on our ability to continue development of our products and services. Many of our products are in development, and we will require substantial additional capital to bring them to full commercialization. Our success also will depend on growing the scale of our products and services, including securing additional orders for vehicles from businesses and fleet operators.
Continued adoption of EVs by operators of commercial vehicle fleets is critical to our success, and such adoption is dependent on several factors, including regulatory mandates, the continuation of subsidies and incentives, electric grid infrastructure improvements, and total cost of ownership as compared to vehicles with internal combustion engines. Although state-level incentives generally continue to provide support for EV ownership, including, without limitation, the state-level incentive programs in California, New Jersey, New York and Washington, the current U.S. presidential administration has created regulatory uncertainty and issued statements in support of the gas and oil industries that may impact growth of the commercial EV market. Additionally, California has withdrawn its waiver request to the EPA, resulting in a suspension of the implementation of the Advanced Clean Fleets Regulation, creating uncertainty regarding the timing and enforcement mechanisms for emissions regulations in California. These regulatory developments may adversely affect EV adoption rates in ways that are difficult to predict at this time.
Further, a global economic recession, downturn or other adverse economic conditions, whether due to changes or uncertainties in trade policies, the imposition or proposed imposition of tariffs, export controls, threat of trade war, persistent inflation, political instability, global or regional conflicts or other geopolitical events, public health crises, interest rate increases or other central bank policy actions, government closures of banks and liquidity concerns at financial institutions, and other macroeconomic or geopolitical factors, may have an adverse impact on our business and prospects. The uncertainties surrounding trade policies, tariffs and export controls, and their effect on economic conditions generally, have caused certain customers to delay purchasing decisions. Higher interest rates, lower cash reserves, fluctuations in foreign currency exchange rates, and weakened consumer confidence may cause additional deferrals or cancellations of purchasing decisions and orders, respectively.
If any of our suppliers, sub-suppliers or partners experience financial distress, insolvency or disruptions in operations, they may be unable to fulfill their obligations or meet our production and quality requirements. Additionally, any deterioration of conditions in the financial markets may limit our ability to obtain external financing to fund our operations and capital expenditures on terms favorable to us, if at all.
Our sales in 2024 were lower than the prior year due to the continued slower-than-anticipated industry wide adoption rates for electric commercial vehicles, the lack of government subsidies and incentives available to our dealers and lagging electric grid infrastructure improvements and the resulting effect on roll-outs of electric vehicle charging infrastructure, nationwide.
The EV adoption landscape in 2025 presents a mixed outlook. State-level incentives continue to provide support for EV ownership, including our W56 platform's approval for California's HVIP through CARB, which offers buyers an $85,000 base voucher per W56 vehicle purchased. However, the changed Presidential Administration has created regulatory uncertainty that may impact market growth. Furthermore, California's recent withdrawal of its waiver request to the EPA has suspended implementation of the Advanced Clean Fleets Regulation ("ACF Regulation"). This withdrawal significantly alters the regulatory framework we previously anticipated. Under the Clean Air Act, California requires EPA approval to establish its own emissions standards for new motor vehicles. With this approval process now paused, the timeline and enforcement mechanisms for emissions regulations remain uncertain. These regulatory developments, together with the new Presidential Administration’s general shift away from policies that promote the reduction of carbon emissions and the use of electric vehicles, constitute material considerations for our operations and strategic planning, potentially affecting adoption rates in ways that are difficult to predict at this time. This evolving regulatory landscape represents a material consideration for our operations and strategic planning, and introduces uncertainty that may impact projected adoption rates.
2024 Securities Purchase Agreement
As part of management's plan to raise capital to fund operations, we entered into a financing arrangement that makes liquidity available in both the short term and over time. On March 15, 2024, we entered into a securities purchase agreement (the “2024 Securities Purchase Agreement”) with an institutional investor (the “Investor”) under which we agreed to issue and sell, in one or more registered public offerings by the Company directly to the Investor in multiple tranches over a period beginning on March 15, 2024, (i) senior secured convertible notes for up to an aggregate principal amount of $139.0 million (the “2024 Notes”) that are convertible into shares of the Company’s Common Stock, and (ii) warrants (the “ 2024 Warrants”) to purchase shares of Common Stock.
Pursuant to the 2024 Securities Purchase Agreement, during the year ended December 31, 2024, the Company issued and sold to the Investor (i) 2024 Notes in the original principal amount of $39.0 million and (ii) issued 15.6 million 2024 Warrants, (1.3 million shares adjusted for the 2025 Reverse).
As of December 31, 2024, the 2024 Notes had an outstanding fair value aggregate principal amount of $10.5 million, with an outstanding aggregate principal amount of $7.6 million. No shares had been issued pursuant to the 2024 Warrants as of December 31, 2024.
In addition, during the first two months of 2025, we issued and sold to the Investor 2024 Notes in the aggregate principal amount of $38.5 million and 2024 Warrants to purchase up to 55.0 million shares of Common Stock, (4.4 million shares adjusted for the 2025 Reverse Stock Split). As described in our Current Report on Form 8-K filed with the SEC on February 12, 2025, we issued a 2024 Note in the aggregate principal amount of $35.0 million (the “Tenth Additional 2024 Note”) governed by a lockbox letter entered into between the Company and the Investor (the “Lockbox Letter”). Pursuant to the Lockbox Letter, the net proceeds of $30.6 million after 12.5% original issue discount and related fees and expenses, of the Tenth Additional 2024 Note were deposited into a lockbox account under the control of the collateral agent under the 2024 Securities Purchase Agreement. Funds may only be released from the lockbox account from time to time (i) in an amount corresponding to the principal amount converted, if the Investor converts any portion of the Tenth Additional 2024 Note; (ii) in the amount of $2.6 million each calendar month, if the Company satisfies the conditions of a Market Release Event (as defined in the Lockbox Letter), including a minimum Common Stock price and trading volume conditions; or (iii) otherwise, with the consent of the Investor. On March 7, 2024, the Investor notified us that it consented to the release of $3.0 million from the lockbox account, which released funds we received on March 11, 2025. Although we expect that we will receive additional funds held in the lockbox account during the term of the Tenth Additional 2024 Note, it is possible that the foregoing events will not occur with respect to some or all of the principal amount of the Tenth Additional 2024 Note and that, accordingly, we will not be able to draw any or all of the remaining funds in the lockbox account.
Although the 2024 Securities Purchase Agreement contemplates the issuance of up to $61.5 million in aggregate principal amount of additional 2024 Notes and corresponding 2024 Warrants, we can issue such 2024 Notes only to the extent we can offer and sell them pursuant to a Registration Statement on Form S-3. Because the “public float” of our Common Stock is currently less than $75 million, the SEC’s “baby shelf” rules will limit the amount of securities we can offer and sell on Form S-3, including the 2024 Notes, Common Stock and all other securities, to one-third of our public float in any twelve month period. Accordingly, our ability to obtain liquidity though public sales of securities, including pursuant to our ATM program and the 2024 Securities Purchase Agreement, is substantially limited.
Prior to entering the 2024 Securities Purchase Agreement described above, the Company satisfied in full the $20.0 million principal amount of green senior convertible notes (the “2026 Notes”) due October 1, 2026, by utilizing $10.0 million of restricted cash and redeeming the related warrants through a combination of cash payment and the exchange of Common Stock.
Lincoln Park Capital Purchase Agreement
On December 12, 2023, the Company entered into an equity line of credit purchase agreement (the “ELOC Purchase Agreement”) with Lincoln Park Capital Fund, LLC (the “Purchaser”) which provides that, upon the terms and subject to the conditions and limitations set forth therein, the Company may sell to the Purchaser up to $50.0 million of shares of Common Stock over the 24-month term of the ELOC Purchase Agreement. Concurrently with entering into the ELOC Purchase Agreement, the Company also entered into a registration rights agreement (the “ELOC Registration Rights Agreement”) with the Purchaser, whereby the issuance of the shares pursuant to the ELOC Purchase Agreement were registered pursuant to the Company’s effective shelf registration statement on Form S-3, and the related base prospectus included in the registration statement, as supplemented by a prospectus supplement filed on December 27, 2023.
The Company may direct the Purchaser, at its sole discretion, and subject to certain conditions, to purchase up to 1.0 million shares of Common Stock on any business day (a “Regular Purchase”). The amount of a Regular Purchase may be increased under certain circumstances to 1.25 million shares if the closing price is not below $0.40 and up to 1.5 million if the closing price is not below $0.50 provided the Purchaser’s committed obligation under any single Regular Purchase shall not exceed $2.0 million. The purchase price for Regular Purchases (the “Purchase Price”) shall be equal to 97.5% of the lower of the lowest sale price of Common Stock on the Purchase Date for such Regular Purchase and the arithmetic average of the three lowest closing sale prices for the Common Stock during the ten consecutive business days ending on the business day immediately prior to the Purchase Date, with a floor of $0.10. In the event the Company issues the full amount allowed under a Regular Purchase on any given business day, we may also direct the Purchaser to purchase additional amounts as accelerated purchases. The purchase price for the accelerated and additional accelerated purchases shall be equal to the lesser of 97.0% of such day’s the VWAP of the Common Stock on the principal market and the closing sale price of the Common Stock on such day.
In connection with the ELOC Purchase Agreement and ELOC Registration Rights Agreement, the Company paid a non-cash commitment fee to the Purchaser in the amount of 3.8 million shares of Common Stock of the Company (valued at $1.5 million). The Company reflected the commitment fee as an expense in Interest expense, net in the Consolidated Statements of Operations based on the fair value on the issuance date.
Under applicable rules of the Nasdaq Capital Market, the Company cannot issue or sell more than 19.99% of the shares of Common Stock outstanding immediately prior to the execution of the ELOC Purchase Agreement to the Purchaser under the ELOC Purchase Agreement without stockholder approval.
During the year ended December 31, 2024, excluding the additional commitment shares issued to the Purchaser disclosed above, the Company did not sell any shares of Common Stock pursuant to the ELOC Purchase Agreement. The Company sold 48,000 shares of Common Stock (adjusted for the 2024 Reverse Stock Split and 2025 Reverse Stock Split) pursuant to the ELOC Purchase Agreement and received proceeds of $3.1 million.
The Company evaluated the contract that includes the right to require the Purchaser to purchase shares of Common Stock in the future (“purchased put right”) considering the guidance in ASC 815-40, Derivatives and Hedging - Contracts on an Entity’s Own Equity, (“ASC 815-40”) and concluded that it is an equity-linked contract that does not qualify for equity classification, as the number of shares is not fixed and therefore requires fair value accounting as a derivative asset. The Company has analyzed the terms of the freestanding purchased put right and has concluded that it has insignificant value as of December 31, 2024.
What changed in the latest 10-Q
Risk Factors
New heading “Risks Related to our Business and Operations”
New heading “Our expansion into the mobile AI data center market may not be successful and could adversely affect our business, financial condition, and results of operations.”
Largest changes
“Our expansion into the mobile AI data center market may not be successful and could adversely affect our business, financial condition, and results of operations.”see in full comparison
“In July 2026, we announced our intention to develop a containerized mobile AI data center product line. While we believe this initiative leverages certain of our existing engineering, manufacturing, and supply chain capabilities, it represents an expansion into a new market with different competitive dynamics, customer requirements, technologies, and operational risks than our historical business.”see in full comparison
“Our expansion into this market may also divert management's attention and financial resources from our existing business, increase operational complexity, and expose us to risks that we have not previously encountered. If we are unsuccessful in developing or commercializing our mobile AI data center products, or if the costs associated with this initiative exceed our expectations, our business, financial condition, operating results, and cash flows could be materially and adversely affected.”see in full comparison
“In addition, the mobile AI data center market is rapidly evolving and subject to changing technologies, customer preferences, regulatory requirements, and competitive pressures. If market adoption develops more slowly than anticipated, if customer demand does not materialize, if we encounter delays in product development or commercialization, or if we are unable to successfully execute our business strategy, our investments may not generate the expected returns.”see in full comparison
“Our success will depend on our ability to design, manufacture, market, and support these products, establish customer demand, secure reliable sources of critical components, raise capital, and effectively compete against established participants in the data center infrastructure market. We may also be required to make significant investments in engineering, manufacturing, inventory, personnel, software, and other resources before realizing meaningful revenue, if any.”see in full comparison
Full comparison: every changed paragraph (7)
For a detailed discussion of risk factors affecting us, see “Part I – Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025. There have been no material changes in the current period regarding our risk factors.factors, other than as noted below.
Risks Related to our Business and Operations
Our expansion into the mobile AI data center market may not be successful and could adversely affect our business, financial condition, and results of operations.
In July 2026, we announced our intention to develop a containerized mobile AI data center product line. While we believe this initiative leverages certain of our existing engineering, manufacturing, and supply chain capabilities, it represents an expansion into a new market with different competitive dynamics, customer requirements, technologies, and operational risks than our historical business.
Our success will depend on our ability to design, manufacture, market, and support these products, establish customer demand, secure reliable sources of critical components, raise capital, and effectively compete against established participants in the data center infrastructure market. We may also be required to make significant investments in engineering, manufacturing, inventory, personnel, software, and other resources before realizing meaningful revenue, if any.
In addition, the mobile AI data center market is rapidly evolving and subject to changing technologies, customer preferences, regulatory requirements, and competitive pressures. If market adoption develops more slowly than anticipated, if customer demand does not materialize, if we encounter delays in product development or commercialization, or if we are unable to successfully execute our business strategy, our investments may not generate the expected returns.
Our expansion into this market may also divert management's attention and financial resources from our existing business, increase operational complexity, and expose us to risks that we have not previously encountered. If we are unsuccessful in developing or commercializing our mobile AI data center products, or if the costs associated with this initiative exceed our expectations, our business, financial condition, operating results, and cash flows could be materially and adversely affected.
Management's Discussion & Analysis (MD&A)
New heading “The statements included herein that are not based solely on historical facts are “forward looking statements.” Such forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties. Our actual results could differ materially from those anticipated by us in these forward-looking statements as a result of various factors, including those discussed in this Report and under Part I, Item 1A. "Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC on March 31, 2026.”
Removed heading “Reverse Merger and Related Transactions”
Removed heading “Pre-Merger Motiv Indebtedness”
Largest changes
“The statements included herein that are not based solely on historical facts are “forward looking statements.” Such forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties. Our actual results could differ materially from those anticipated by us in these forward-looking statements as a result of various factors, including those discussed in this Report and under Part I, Item 1A. "Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC on March 31, 2026.”see in full comparison
“In June 2026, Workhorse made the following amendments to the Credit Agreements: (i) amends the Cash Flow Credit Agreement to increase the borrowing capacity from $20.0 million to $30.0 million, (ii) amends the Cash Flow Credit Agreement to defer interest payments on the additional $10.0 million Commitment until the first Interest Payment Date (as defined in the Cash Flow Credit Agreement) occurring after September 30, 2026, (iii) amends the Customer Order Credit Agreement to reduce the borrowing capacity from $30.0 million to $20.0 million and (iv) obligates the Company to issue warrants to …”see in full comparison
In April 2026,see in full comparisonweWorkhorseamendedmade the following amendments to the Credit Agreements: (i) amends the Cash Flow Credit Agreement to increase the borrowing capacityunder the Cash Flow Credit Agreementfrom $10.0 million to $20.0 million,and(ii)reduceamends theborrowingCashcapacityFlowunderCredit Agreement to defer interest payments on the additional $10.0 million Commitment until the Interest Payment Date (as defined in the Cash Flow Credit Agreement) occurring after September 30, 2026 and (iii) amends the Customer Order Credit Agreement to reduce the borrowing capacity from $40.0 million to $30.0 million.
We continue to develop relationships with suppliers of key parts, components and raw materials to be used in the manufacture of our products such as batteries, electronics, and truck chassis that are sourced from suppliers across the world. As we continue to execute on our new truck programs, we will continue to identify supplier relationships and truck program synergies which may allow us to take advantage of pricing efficiencies from economies of scale. Where available, we will utilize multiple supply sources for key parts, and we will work to qualify multiple supply sources to achieve pricing efficiencies and minimize potential production risks related to supply chain. As previously disclosed, we are currently working with certain of our vendors to extend or restructure the payment terms of past due accounts payable balances.see in full comparisonWe were in litigation with one of our battery suppliers, Coulomb Solutions Inc., but entered into a settlement agreement in April 2026. For more information concerning this matter, see Note 15, Commitments and Contingencies, and Note 16, Subsequent Events, in the notes to the accompanying Condensed Consolidated Financial Statements.
Full comparison: every changed paragraph (36)
The following discussion should be read in conjunction with the Condensed Consolidated Financial Statements and notes thereto included under Item 1 in this Quarterly Report on Form 10-Q (this “Report”) and our Consolidated Financial Statements and notes thereto and related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2025.
The statements included herein that are not based solely on historical facts are “forward looking statements.” Such forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties. Our actual results could differ materially from those anticipated by us in these forward-looking statements as a result of various factors, including those discussed in this Report and under Part I, Item 1A. "Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC on March 31, 2026.
Workhorse Group Inc. (“Workhorse,” or the “Company”) is a North American manufacturer of medium-duty electric trucks and buses. Our primarycurrent focuscommercial isoperations toare provideprimarily focused on providing sustainable and cost-effective solutions to the commercial transportation sector. We design and manufacture all-electric vehicles, including the technology that optimizes the way that these vehicles operate. The Company’s best-in-class vehicles are designed for last-mile delivery, medium-duty operations, and a growing range of specialized applications.
We continue to seek opportunities to grow our business organically, and by expanding relationships with existing and new customers and dealers. We believe we are well positioned to take advantage of long-term opportunities and continue our efforts to bring product innovations to market. In July 2026, we announced that we are developing a containerized mobile AI data center product line intended to leverage our existing engineering and manufacturing capabilities.
Recent Events
Reverse Merger and Related Transactions
Motiv is a leading manufacturer of medium duty, zero-emission electric trucks and buses. Motiv produces a range of vehicles, including step vans, shuttle buses, box trucks and work trucks, all of which eliminate tailpipe CO2 emissions and particulate matter, while offering drivers and passengers a comfortable, healthier and safer ride. The Merger is intended to broaden our product portfolio and strengthen our financial position by combining complementary products, fleet dealerships and dealer networks, as well as creating operational scale and cost synergies, including as a result of the transactions described below.
The Merger was accounted for as a reverse merger, with Motiv being treated as the acquirer for accounting purposes. References to “Workhorse,” the “Company,” “we,” “us,” or “our,” when used in this Quarterly Report on Form 10-Q (this "Report") incorporate the operations of Motiv unless otherwise indicated or the context requires otherwise. See Note 2, Merger and Related Transactions, in the notes to the accompanying Condensed Consolidated Financial Statements.
Pre-Merger Motiv Indebtedness
Pre-MergerMerger WorkhorseRelated IndebtednessTransactions
As of June 30, 2026, all shares of Common Stock have been issued to the 2024 Note Holder, and no shares remain issuable under the stock Rights liability.
On April 25, 2026, the Company and an affiliate of MGMH entered into an agreement whereby Lessorthe lessor agreed to a deferral of the Company’s monthly rental payments pursuant to the lease for the Company’s manufacturing facility in Union City, Indiana for five months beginning May 2026, with the entire deferred amount due and payable in a single lump-sum payment on or before September 30, 2026. In August 2026, the parties to the lease entered into an agreement whereby the lessor agreed to a further deferral of the Company’s monthly rental payments, as further described in Note 16, Subsequent Events, to the Condensed Consolidated Financial Statements.
In April 2026, weWorkhorse amendedmade the following amendments to the Credit Agreements: (i) amends the Cash Flow Credit Agreement to increase the borrowing capacity under the Cash Flow Credit Agreement from $10.0 million to $20.0 million, and(ii) reduceamends the borrowingCash capacityFlow underCredit Agreement to defer interest payments on the additional $10.0 million Commitment until the Interest Payment Date (as defined in the Cash Flow Credit Agreement) occurring after September 30, 2026 and (iii) amends the Customer Order Credit Agreement to reduce the borrowing capacity from $40.0 million to $30.0 million.
In June 2026, Workhorse made the following amendments to the Credit Agreements: (i) amends the Cash Flow Credit Agreement to increase the borrowing capacity from $20.0 million to $30.0 million, (ii) amends the Cash Flow Credit Agreement to defer interest payments on the additional $10.0 million Commitment until the first Interest Payment Date (as defined in the Cash Flow Credit Agreement) occurring after September 30, 2026, (iii) amends the Customer Order Credit Agreement to reduce the borrowing capacity from $30.0 million to $20.0 million and (iv) obligates the Company to issue warrants to purchase equity interests in the Company within 45 days of the execution of the amendment or such later date as the lender agrees, with terms and in number to be mutually agreed, as consideration for the amendments therein. In August 2026, the Company further amended the Credit Agreements to increase the borrowing capacity under the Cash Flow Credit Agreement from $30.0 million to $40.0 million and to defer interest payments on the additional commitments until after January 31, 2027, as further described in Note 16, Subsequent Events, to the Condensed Consolidated Financial Statements.
In order to manage liquidity and operating capital, the Company entered into certain of the transactions described above, including the Convertible Financing and the Sale-Leaseback transaction, pursuant to which the Company received gross proceeds of $25.0 million. As of MarchJune 31,30, 2026, there was $5.0 million in principal outstanding under the A&R Note. Additionally, the Company has access to the Customer Order Credit Agreement and the Cash Flow Credit Agreement. See discussion above in Post-Merger Financing for further information on the borrowing capacity of the Credit Agreements. As of MarchJune 31,30, 2026, the Company had $5.0$18.3 million in outstanding borrowings and remaining availability of $35.0$1.7 million under the Customer Order Credit Agreement. As of MarchJune 31,30, 2026, the Company had $10.0$30.0 million in outstanding borrowings and no remaining availability under the Cash Flow Credit Agreement.
On April 1, 2026, we borrowed $7.25 million under the Customer Order Credit Agreement, and following the effectiveness of the amendment to increase the borrowing capacity, we borrowed an additional $10.0 million under the Cash Flow Credit Agreement. As of the filing date, we had $12.25$18.3 million in outstanding borrowings and $1.7 million remaining availability of $17.75 million under the Customer Order Credit Agreement, and we had $20.0$40.0 million in outstanding borrowings and no remaining availability under the Cash Flow Credit Agreement.
Subject to certain conditions, the Credit Agreements permit the Company to raise funds through an equity or equity-linked financing. The Company is actively working to evaluate financing alternatives; however, the consummation of such a transaction is not probable as of the issuance date of the accompanying Condensed Consolidated Financial Statements.
Because of the foregoing,Accordingly, our ability to obtain additional proceeds from financing is extremely limited under current conditions, and if we are unable to obtain such proceeds, we may need to further adjust our operations and seek protection by filing a voluntary petition for relief under the Bankruptcy Code. If this were to occur, the value available to our various stakeholders, including our creditors and stockholders, is uncertain and trading prices for our securities may bear little or no relationship to the actual recovery, if any, by holders of our securities in bankruptcy proceedings, if any.proceedings.
The Company is actively working to evaluate financing alternatives; however, as noted above, as of the issuance date of the accompanying Condensed Consolidated Financial Statements, it is not probable that a potential equity or equity-linked financing transaction will be consummated.
We continue to focus on product quality, manufacturing capacity and operational planning, and engineering and design to enable increased deliveries and deployments of our products and future revenue growth. We have plans to continue to reduce the total cost of and enhance the design and performance of our current product lineup, as well as design new vehicles as the market evolves. We intendare to developplanning a new, proprietary “modular” chassis design that will be based on the foundational learnings gathered from proven W56 components but with a scalable architecture that supports flexible wheelbase configurations, advanced battery and axle technologies, and next-generation software and power electronics. In addition, we are planning for our first Class 5/6 cab chassischassis, and expect that this productwhich will bepair ablethe tonew bemodular usedchassis with a lightweight, low-cost cab designed for dryefficient box,upfitting, refrigeration,spanning stakeapplications bed,across utilityall andclasses shuttleof purposes.medium duty trucks. We continued to electrify the fleet of trucks being used in our Stables by Workhorse initiative, which operates FedEx Ground delivery routes in the greater Cincinnati, OH area. The electrification of the fleet provides us with firsthand data on the benefits and challenges of independent fleet operators experience while executing last-mile delivery operations. The initiative also provides valuable insights into how our customers can plan for and manage the transition to EV operations, including how to develop adequate charging infrastructure, training and maintenance services. In addition to our ongoing production ramp in 2026, we intend to continue to generate demand and brand awareness by improving our trucks’ performance and functionality, and by developing new truck programs, including new W56 variants. We expect to continue to benefit from ongoing electrification of the commercial truck market and in particular “last mile delivery” sector.
We continue to develop relationships with suppliers of key parts, components and raw materials to be used in the manufacture of our products such as batteries, electronics, and truck chassis that are sourced from suppliers across the world. As we continue to execute on our new truck programs, we will continue to identify supplier relationships and truck program synergies which may allow us to take advantage of pricing efficiencies from economies of scale. Where available, we will utilize multiple supply sources for key parts, and we will work to qualify multiple supply sources to achieve pricing efficiencies and minimize potential production risks related to supply chain. As previously disclosed, we are currently working with certain of our vendors to extend or restructure the payment terms of past due accounts payable balances. We were in litigation with one of our battery suppliers, Coulomb Solutions Inc., but entered into a settlement agreement in April 2026. For more information concerning this matter, see Note 15, Commitments and Contingencies, and Note 16, Subsequent Events, in the notes to the accompanying Condensed Consolidated Financial Statements.
The following section provides a narrative discussion about our financial condition and results of operations. The narrative should be read in conjunction with our Condensed Consolidated Financial Statements and related Notes thereto included in Item 1 of this Report and in conjunction with our 2025 Form 10-K.
Our Condensed Consolidated Statements of Operations isare as follows:
Sales, net of returns and allowances were $3.6 million and $0.8 million for the three months ended MarchJune 31,30, 2026 and 20252025, wererespectively, $4.3and $7.9 million and $1.1$1.9 million,million for the six months ended June 30, 2026 and 2025, respectively. TheFor increasethe inthree and six months ended June 30, 2026, the sales of $3.2 millionincrease was driven by deliveringthe 16delivery of 22 and 39 more vehiclesvehicles, in the first quarter of 2026respectively, as compared to the prior year,year includingperiods. deliveringThese 15deliveries included 13 and 28 Workhorse W56 vehicles in the currentthree year.and six months ended June 30, 2026, respectively. Additionally, in the second quarter of 2026, we sold 12 older model Workhorse vehicles at a discounted amount in order to sell through the inventory.
Cost of sales were $11.0 million and $2.1 million for the three months ended MarchJune 31,30, 2026 and 20252025, wererespectively, $11.8and $22.8 million and $2.2$4.3 million,million for the six months ended June 30, 2026 and 2025, respectively. The increaseincreases in cost of sales of $9.6$8.9 million wasand $18.5 million for the three and six months ended June 30, 2026, respectively, were primarily a result of higher sales volume as well asand the higher fixed cost base of theWorkhorse's combinedUnion City, IN manufacturing footprint,facility. includingAdditionally, costs in the costsfirst forquarter of 2026 included the Workhorse manufacturing facility as well as contract manufacturing undercosts of the legacy Motiv operational structurestructure. duringWe the quarter. Additionally, wealso incurred $1.5$0.9 million and $2.4 million in higher warranty costs in the firstthree quarterand ofsix months ended June 30, 2026, respectively, which was primarily attributable to costs related to aan ongoing retrofit campaign that is underway for certain Motiv trucks sold in Canada. Costs incurred for the retrofit campaign during the quartercurrent wereyear higher thanexceeded our original estimates, and we increased our reserves required to complete the retrofit campaign. These items were partly offset by margin realized on the sale of 12 older model Workhorse vehicles during the second quarter of 2026 that had been previously written down.
Selling, general and administrative expenses (“SG&A”) expenses were $7.8 million and $4.5 million for the three months ended MarchJune 31,30, 2026 and 20252025, wererespectively, $9.5and $17.4 million and $4.3$8.8 million,million for the six months ended June 30, 2026 and 2025, respectively. The increaseincreases in SG&A of $5.2$3.4 million wasand $8.6 million for three and six months ended June 30, 2026, respectively, were primarily driven by the Merger, with costs inas the firstcurrent quarteryear ofperiods 2026 reflectingreflected the costs of the combined company, whilewhereas the costscorresponding inprior-year theperiods prior year periodreflected only reflected the costs of Motiv’s historical operations. The main drivers of the higher costs includewere primarily attributable to legal, consulting, accounting and investor relations fees, as well as higher IT costs andcosts, increased cost for D&O insurance,insurance primarilycosts relatedassociated to being a publicly traded company inwith the currentcombined year,company’s whilepublic-company thestatus, prior year reflected the operations of a privately held company. We also incurred higherand rent costsexpense for redundantduplicative facilities pending closure as wepart work to completeof the Merger integration and close redundant facilities.integration. These costsincreases were partly offset by synergiesMerger-related resulting from the Merger,synergies, including thereductions elimination ofin redundant headcount and other operating costs.
Research and development (“R&D”) expenses duringwere $4.1 million and $3.2 million for the three months ended MarchJune 31,30, 2026 and 20252025, wererespectively, $4.1and $8.2 million and $3.7$6.9 million,million for the six months ended June 30, 2026 and 2025, respectively. The increaseincreases in R&D expenses of $0.4$0.9 million wasand $1.3 million for the three and six months ended June 30, 2026, respectively, were primarily driven by higher employee compensation and related expenses asassociated wewith investour investment in key R&D on key projects, including our initiative to lowerreduce the total bill of material cost of our vehicles to belevels in linecomparable with internal combustion engine (“"ICE”") vehicles.
For the three months endingended MarchJune 31,30, 2026 and 2025, Interest expense, net was $0.4$0.8 million and $3.6$3.8 million, respectively. For the six months ended June 30, 2026 and 2025, Interest expense, net was $1.2 million and $7.4 million, respectively. The difference was primarily driven by lower outstanding debt at lower interest rates in the first quartersix months of 2026 as compared to the prior year. All debt that was outstanding as of MarchJune 31,30, 2025 was restructured asin partconnection ofwith the Merger, resulting in lower debt levels at lower interest rates.
In connection with the Merger, we assumed the A&R Note that is remeasured to fair value at each reporting period. As of MarchJune 31,30, 2026, the estimated fair value of the A&R Note was $5.4$5.6 million. We recorded a fair value loss of $0.1 million and $0.3 million for the three and six months ended MarchJune 31,30, 2026.2026, respectively.
In connection with the Merger, we assumed an outstanding liability for Rights to acquire 1,193,364 shares of Workhorse Common Stock (the “Rights”). The Rights were issued pre-Merger in exchange for the cancellation of the 2024 Warrants. The Rights are periodically marked-to-market using the closing price of Workhorse Common Stock. During the three and six months ended MarchJune 31,30, 2026, we recorded $1.7$0.2 million and $1.9 million, respectively, of income related to changes in the fair value of the Rights. As of June 30, 2026, all Rights have been exercised, and no shares remain issuable under the stock Rights liability.
We had sales of $4.3$7.9 million, incurred a net loss of $19.9$40.1 million and used $16.5$40.6 million of cash in operating activities during the threesix months ended MarchJune 31,30, 2026. As of MarchJune 31,30, 2026, we had $0.6$9.6 million of cash and cash equivalents and $0.7 million in restricted cash.
•Generating revenue by developing a containerized mobile AI data center product line;
•Successfully entering the mobile AI data center category and developing the new product line;
During the threesix months ended MarchJune 31,30, 2026 and 2025, net cash used in operating activities was $16.5$40.6 million and $12.5$21.7 million, respectively. The increase in net cash used in operations was primarily attributable to higher net losses of $14.6 million in the first quartersix months of 2026 as compared to the prior year.
Cash used in investing activities related primarily to capital expenditures, totaling $0.1$0.3 million for the threesix months ended MarchJune 31,30, 2026, and $0.2$0.3 million for the threesix months ended MarchJune 31,30, 2025. Capital expenditures in 2026 were due to investments in tooling and equipment required as we transition the manufacturing of legacy Motiv vehicles in the Workhorse manufacturing facility in Union City, IN as a result of the Merger.
Net cash provided by financing activities during the threesix months ended MarchJune 31,30, 2026, was $5.0$38.3 million, which was attributable to proceeds received during the period from the Cash Flow Credit Agreement and Customer Order Credit Agreement. Net cash provided by financing activities during the threesix months ended MarchJune 31,30, 2025, was $10.0$18.0 million, which was attributable to proceeds received during the period from the A&R Senior Note.
WKHS insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-07-20 | Barnes Lindsay A |
Grant/award | 56,250 | — | — |
| 2026-07-20 | Davis Jody |
Grant/award | 93,750 | — | — |
| 2026-07-20 | Griffin James Francis |
Grant/award | 62,500 | — | — |
| 2026-07-20 | Zion William Scott |
Grant/award | 87,500 | — | — |
| 2026-07-20 | Anderson Joshua Joseph |
Grant/award | 93,750 | — | — |
| 2026-07-20 | Griffith Scott W. |
Grant/award | 562,500 | — | — |
| 2026-07-17 | O'leary Matthew C. |
Grant/award | 38,105 | — | — |
| 2026-07-17 | Savoie Paul Timothy |
Grant/award | 30,484 | — | — |
| 2026-07-17 | Ujkashevic Fildeza |
Grant/award | 30,484 | — | — |
| 2026-07-17 | Mader Pamela S. |
Grant/award | 30,484 | — | — |
| 2026-07-17 | Henricks Alan S. |
Grant/award | 30,484 | — | — |
| 2026-07-17 | Chess Raymond Joseph |
Grant/award | 30,484 | — | — |
Well-known investors holding WKHS (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Millennium Management (Israel Englander) | 2026-06-30 | 18,814 | $56.8K | — | Sold out |