wkhs-20250630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number: 001-37673

WORKHORSE GROUP INC.

(Exact name of registrant as specified in its charter)


Nevada						26-1394771
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

3600 Park 42 Drive, Suite 160E, Sharonville, Ohio 45241

(Address of principal executive offices, including zip code)

1 (888) 646-5205

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.001 par value per share

WKHS

The NASDAQ Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the Registrant’s Common Stock, $0.001 par value per share, outstanding as of August 12, 2025, was 15,373,266.

TABLE OF CONTENTS


PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2

	Condensed Consolidated Statements of Stockholders’ Equity	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	38
Item 4.	Controls and Procedures	38

PART II	OTHER INFORMATION	40

Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	42
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	43
	SIGNATURES	44

Forward-Looking Statements

The discussions in this Quarterly Report on Form 10-Q (“Report”) 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 Report, 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, including our ability to receive sufficient funding from our existing financing arrangements or from future financings 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: the outcome of continuing discussions between the parties with respect to the Recent Transactions (as defined below), including the possibility that the parties may terminate certain of the Recent Transactions or that the terms of certain of the Recent Transactions may change; our ability to consummate the Recent Transactions or achieve the expected synergies and/or efficiencies; potential regulatory delays; the industry and market reaction to the announcement of the Recent Transactions; the effect of the announcement of the Recent Transactions on the ability of the parties to operate their businesses and retain and hire key personnel and to maintain favorable business relationships; the possibility that the integration of the Merger parties (as defined below) may be more difficult, time-consuming or costly than expected or that operating costs and business disruptions may be greater than expected; the ability to obtain regulatory and other approvals required to consummate the Recent Transactions, including from Nasdaq; our ability to develop and manufacture our product portfolio, including the W4 CC, W750, and W56 and other programs; our ability to attract and retain customers for our existing and new products; ongoing and anticipated changes in the U.S. political environment, including those resulting from the new Presidential Administration, control of Congress, and changes to regulatory agencies; the implementation of changes to the existing tariff regime by the new Presidential Administration and measures taken in response to such tariffs by foreign governments; risks associated with obtaining orders and executing upon such orders; the unavailability, reduction, elimination or adverse application of government subsidies and incentives or any challenge to or failure by the federal government, states or other governmental entities to adopt or enforce regulations such as the California Air Resource Board’s Advanced Clean Fleet regulation; changes in attitude toward environmental, social, and governance matters among regulators, investors, and parties with which we do business; supply chain disruptions, including constraints on steel, semiconductors and other material inputs and resulting cost increases impacting our Company, our customers, our suppliers or the industry; our ability to capitalize on opportunities to deliver products to meet customer requirements; our limited operations and need to expand and enhance elements of our production process to fulfill product orders; our general inability to raise additional capital to fund our operations and business plan; our ability to receive sufficient proceeds from our current and any future financing arrangements to meet our immediate liquidity needs and the potential costs, dilution and restrictions resulting from any such financing; our ability to maintain compliance with the listing requirements of the Nasdaq and the impact of any steps we have taken, including reverse splits of our Common Stock, on our operations, stock price and future access to funds; our ability to protect our intellectual property; market acceptance of our products; our ability to obtain sufficient liquidity from operations and financing activities to continue as a going concern and, our ability to control our expenses; the effectiveness of our cost control measures and impact such measures could have on our operations, including the effects of furloughing employees; potential competition, including without limitation shifts in technology; volatility in and deterioration of national and international capital markets and economic conditions; global and local business conditions; acts of war (including without limitation the conflicts in Ukraine and the Middle East) and/or terrorism; the prices being charged by our competitors; our inability to retain key members of our management team; our inability to satisfy our customer warranty claims; the outcome of any regulatory or legal proceedings, including with Coulomb Solutions Inc.; and other risks and uncertainties and other factors discussed from time to time in our filings with the Securities and Exchange Commission (“SEC”), including under the “Risk Factors” section of our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”).

Forward-looking statements speak only as of the date they are made. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

All references in this Report that refer to the “Company”, “Workhorse Group”, “Workhorse”, “we,” “us” or “our” are to Workhorse Group Inc.

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Workhorse Group Inc.

Condensed Consolidated Balance Sheets


	(Unaudited) June 30, 2025		December 31, 2024
Assets
Current assets:
Cash and cash equivalents	$	2,190,820	$	4,119,938
Restricted cash	22,528,341		525,000
Accounts receivable, less allowance for credit losses of $0.3 million and $0.2 million as of June 30, 2025 and December 31, 2024, respectively	2,372,701		537,536
Other receivables, net	136,474		544,436
Inventory, net	32,757,831		41,839,020
Prepaid expenses and other current assets	3,702,346		5,865,890
Total current assets	63,688,513		53,431,820
Property, plant and equipment, net	29,145,327		32,976,581

Operating lease right-of-use assets, net	6,003,964		3,247,548
Finance lease right-of-use assets, net	—		4,008,510
Other assets	416,308		176,311
Total Assets	$	99,254,112	$	93,840,770
Liabilities
Current liabilities:
Accounts payable	$	10,823,073	$	11,509,150
Accrued liabilities and other current liabilities	11,200,767		8,731,915
Deferred revenue	6,048,581		6,350,581
Warranty liability	1,151,614		861,409
Operating lease liability - current portion	1,593,131		984,407
Finance lease liability - current portion	—		528,023
Warrant liability at fair value	3,145,592		5,778,660
Convertible notes at fair value	39,520,020		10,491,792
Total current liabilities	73,482,778		45,235,937
Operating lease liability-long-term	3,424,595		4,295,743
Financing lease liability-long-term	—		21,165
Total Liabilities	76,907,373		49,552,845
Commitments and contingencies
Stockholders’ Equity:

Common stock, par value $0.001 per share, 36,000,000 shares authorized, 10,585,800 shares issued and outstanding as of June 30, 2025 and 3,843,336 shares issued and outstanding as of December 31, 2024 (presented on a reverse stock split-adjusted basis)*	10,586		3,843
Additional paid-in capital *	911,119,795		897,642,626
Accumulated deficit	(888,783,642)		(853,358,544)

Total stockholders’ equity	22,346,739		44,287,925
Total Liabilities and Stockholders’ Equity	$	99,254,112	$	93,840,770

* Periods presented have been adjusted to reflect the 2024 reverse stock split (1-for-20), which was effective June 17, 2024 and the 2025 reverse stock split (1-for-12.5) which was effective March 17, 2025. Additional information regarding the reverse stock splits may be found in Note 1 – Summary of Business and Significant Accounting Principles to these Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q

See accompanying notes to the Condensed Consolidated Financial Statements.

Workhorse Group Inc.

Condensed Consolidated Statements of Operations

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Sales, net of returns and allowances	$	5,669,469	$	842,440	$	6,310,391	$	2,181,735
Cost of sales	13,051,356		7,301,348		18,216,119		14,744,126
Gross loss	(7,381,887)		(6,458,908)		(11,905,728)		(12,562,391)
Operating expenses
Selling, general and administrative	5,844,698		12,066,553		12,628,609		26,161,831
Research and development	1,246,348		1,992,779		2,775,367		5,520,690
Total operating expenses	7,091,046		14,059,332		15,403,976		31,682,521
Loss from operations	(14,472,933)		(20,518,240)		(27,309,704)		(44,244,912)
Interest expense, net	(582,246)		(2,028,808)		(5,834,474)		(3,193,401)
Change in fair value of convertible notes	(1,641,893)		(3,130,051)		(4,913,988)		(3,597,925)
Change in fair value of warrants	1,916,108		(642,900)		2,633,068		(4,439,548)

Loss before provision for income taxes	(14,780,964)		(26,319,999)		(35,425,098)		(55,475,786)
Provision for income taxes	—		—		—		—
Net loss	$	(14,780,964)	$	(26,319,999)	$	(35,425,098)	$	(55,475,786)

Net loss per share of common stock
Basic and Diluted*	$	(1.67)	$	(17.45)	$	(5.34)	$	(40.81)


Weighted average shares used in computing net loss per share of common stock
Basic and Diluted*	8,827,196		1,508,403		6,630,399		1,359,416

See accompanying notes to the Condensed Consolidated Financial Statements.

Workhorse Group Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)


	Common Stock			Additional Paid-in Capital*	Accumulated Deficit				Total Stockholders’ Equity
	Number of Shares*	Amount*
Balance as of December 31, 2023	1,143,923	$	1,144		$	834,679,278	$	(751,568,251)		$	83,112,171
Common stock issued under ATM	39,236	39			1,242,609		—			1,242,648
Common stock issued under 2023 Warrant Exchange	34,000	34			2,847,466		—			2,847,500
Issuance of common stock under ELOC Purchase Agreement	48,000	48			3,123,952					3,124,000
Common stock issued under 2024 Securities Purchase Agreement	53,118	53			3,268,394		—			3,268,447
Stock options and vesting of restricted shares**	4,891	5			(163,521)		—			(163,516)
Stock-based compensation					3,148,308		—			3,148,308
Net loss							(29,155,787)			(29,155,787)
Balance as of March 31, 2024	1,323,168	1,323			848,146,486		(780,724,038)			67,423,771
Common stock issued under 2024 Securities Purchase Agreement	332,611	333			14,641,405		—			14,641,738
Stock options and vesting of restricted shares**	3,268	3			(4,769)					(4,766)
Stock-based compensation	—	—			2,896,212					2,896,212
Net loss	—	—			—		(26,319,999)			(26,319,999)
Balance as of June 30, 2024	1,659,047	$	1,659		$	865,679,334	$(807,044,037)			$	58,636,956

**Net of tax payments related to shares withheld for option exercises and vested stock.

See accompanying notes to the Condensed Consolidated Financial Statements.

Workhorse Group Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)


	Common Stock			Additional Paid-in Capital*	Accumulated Deficit				Total Stockholders’ Equity
	Number of Shares*	Amount*
Balance as of December 31, 2024	3,843,341	$	3,843		$	897,642,626	$	(853,358,544)		$	44,287,925
Common stock issued under ATM	45,755	46			—		—			46
Common stock issued under Convertible Note	1,862,003	1,862			6,971,603		—			6,973,465
Stock options and vesting of restricted shares**	6,492	6			23,387					23,393
Stock based compensation**	—	—			751,401		—			751,401
Net loss	—	—			—		(20,644,134)			(20,644,134)
Balance as of March 31, 2025	5,757,591	5,757			905,389,017		(874,002,678)			31,392,096




Common stock issued under Convertible Note	4,828,131	4,828			5,358,428		—			5,363,256
Stock options and vesting of restricted shares**	78	1			(16,321)					(16,320)
Stock based compensation**	—	—			388,671		—			388,671
Net loss	—	—			—		(14,780,964)			(14,780,964)
Balance as of June 30, 2025	10,585,800	$	10,586		$	911,119,795	$	(888,783,642)		$	22,346,739

**Net of tax payments related to shares withheld for option exercises and vested stock.

See accompanying notes to the Condensed Consolidated Financial Statements

Workhorse Group Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)


	Six Months Ended June 30,
	2025		2024
Cash flows from operating activities:
Net loss	$	(35,425,098)	$	(55,475,786)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	3,801,443		4,019,532
Stock-based compensation	1,140,072		6,266,416
Change in inventory and prepaid purchases reserve	4,595,365		4,575,287
Non-cash lease expense	440,483		216,263
Change in fair value and gain on conversion of 2026 Notes and Warrants	—		(2,937,925)
Non-cash change in fair value loss of convertible notes	4,913,987		5,354,074
Non-cash change in fair value of warrants	(2,633,068)		5,623,920
Non-cash payment of convertible notes	(2,049,038)		—
Original issuance discount - non-cash fees on convertible notes	4,812,500		1,661,995


Effects of changes in operating assets and liabilities:
Accounts receivable	(1,834,120)		3,709,705
Inventory, net	5,610,038		(5,724,913)
Prepaid expenses and other current assets	1,039,330		1,253,225
Other assets	(239,998)		—
Accounts payable and accrued liabilities	1,812,586		414,822
Deferred revenue	(302,000)		2,240,250
Warranty liability	290,205		(1,260,321)

Net cash used in operating activities	(14,027,313)		(30,063,456)

Cash flows from investing activities:
Capital expenditures	—		(3,759,353)
Net cash used in investing activities	—		(3,759,353)

Cash flows from financing activities:
Proceeds from convertible notes	33,687,500		19,500,000
Payments on convertible notes	—		(20,000,000)
Proceeds from issuance of common stock	406,963		4,366,649
Payments on finance lease	—		(412,530)
Exercise of options and restricted share award activity	7,073		(168,614)
Net cash provided by (used in) financing activities	34,101,536		3,285,505

Change in cash and cash equivalents and restricted cash	20,074,223		(30,537,304)
Cash and cash equivalents and restricted cash, beginning of the period	4,644,938		35,845,915
Cash and cash equivalents and restricted cash, end of the period	$	24,719,161	$	5,308,611

See accompanying notes to the Condensed Consolidated Financial Statements.

Workhorse Group Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1.SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING PRINCIPLES

Overview

Workhorse Group Inc. (“Workhorse”, the “Company”, “we”, “us”, or “our”) is an American technology company with a vision to pioneer the transition to zero-emission commercial trucks. Our primary focus is to provide robust, sustainable and cost-effective solutions to the commercial transportation sector. We design, develop, manufacture and sell fully electric trucks.

Liquidity, Capital Resources, and Going Concern

The accompanying Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) applicable to a going concern. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these Condensed Consolidated Financial Statements are issued and will be able to realize assets and discharge its liabilities and commitments in the normal course of business. The Condensed Consolidated Financial Statements do not include any adjustments to the carrying amounts and classification of assets, liabilities, and reported expenses that may be necessary if the Company were unable to continue as a going concern.

Pursuant to the requirements of the Financial Accounting Standard Board’s (“FASB”) Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements - Going Concern (“ASC 205-40”), management must evaluate whether there are conditions and events, considered in aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for at least one year after the date that these Condensed Consolidated Financial Statements are issued. In accordance with ASC 205-40, management’s analysis can only include the potential mitigating impact of management’s plans that have not been fully implemented as of the issuance date if (a) it is probable that management’s plans will be effectively implemented on a timely basis, and (b) it is probable that the plans, when implemented, will alleviate the relevant conditions or events that raise substantial doubt about the Company’s ability to continue as a going concern.

We had sales of $6.3 million, incurred a net loss of $35.4 million and used $14.0 million of cash in operating activities during the six months ended June 30, 2025. As of June 30, 2025, we had $2.2 million of cash and cash equivalents and $22.5 million in restricted cash, net accounts receivable of $2.4 million, other receivables of $0.1 million, net inventory of $32.8 million and accounts payable of $10.8 million. As of June 30, 2025, the Company had negative working capital of $9.8 million and an accumulated deficit of $888.8 million.

As a result of our recurring losses from operations, accumulated deficit, projected capital needs, and delays in bringing our trucks to market and lower than expected market demand, substantial doubt exists regarding our ability to continue as a going concern within one year after the issuance date of the accompanying Condensed Consolidated Financial Statements. Our ability to continue as a going concern is contingent upon successful execution of management’s intended plan over the next twelve months to improve the Company’s liquidity and working capital, which includes, but is not limited to:

•Generating revenue by increasing sales of our trucks and other services.

•Reducing expenses and limiting non-contracted capital expenditures.

•Receiving proceeds from our current financing arrangements, including through our 2024 Securities Purchase Agreement (as defined below).

•Sale Leaseback of Union City, Indiana Manufacturing Facility

As disclosed previously, our executive officers agreed to defer approximately 20% of their cash compensation from the first quarter of 2024 through the third quarter of 2024. The deferred compensation remained outstanding until the Company determined it had sufficient liquidity to make payment. In July 2025, the Company paid the deferred compensation of $0.4 million, which was recorded in Accrued liabilities and other current liabilities in the Condensed Consolidated Balance Sheets, to the participating executive officers.

It is essential that we have access to capital as we bring our existing line of trucks to market, scale up production and sales of such trucks and continue to develop additional variations of our existing trucks and our next generation of trucks. There is no assurance that we will be successful in implementing management’s plans to generate liquidity to fund these activities or other aspects of our short and long-term strategy, that our projections of our future capital needs will prove accurate or that any additional funding would be available or sufficient to continue operations in future periods.

Our revenues from operations are unlikely to be sufficient to meet our liquidity requirements for the twelve months following the date of the issuance of our Condensed Consolidated Financial Statements, and, accordingly, our ability to continue as a going concern depends on our ability to obtain and receive proceeds from third-party financing. We currently expect that our primary source of third-party financing will be the proceeds of the Tenth Additional 2024 Note (as defined below), which we issued under our 2024 Securities Purchase Agreement, the Sale Leaseback, and the Convertible Note. As of August 12, 2025, approximately $15.1 million of the gross proceeds of the Tenth Additional 2024 Note had been released from the lockbox account and approximately $17.4 million of such proceeds remain in the lockbox account and will be available to us only upon satisfaction or waiver of the conditions described below. Accordingly, there can be no assurance that any or all of such proceeds will be available to us on a timely basis or ever.

Under the ATM Agreement, we may offer and sell shares of our Common Stock having an aggregate sales price of up to $175.0 million, at amounts and times determined by management. During the year ended December 31, 2024, we issued 0.2 million shares under the ATM Agreement for net proceeds of $4.2 million, as adjusted for our 2025 Reverse Stock Split (as defined below). During the six months ended June 30, 2025, no shares were issued under the ATM Agreement, In comparison, during the same period in 2024, we issued 0.5 million shares under the ATM Agreement, for net proceeds of $2.7 million. As of June 30, 2025, approximately $95.0 million remained available under the ATM Agreement. Certain of our other existing financing arrangements place certain conditions and restrictions on the use of our ATM Agreement. In addition, the terms of our existing financing arrangements impose substantial restrictions on our ability to obtain additional financing.

Because of the foregoing, 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.

These conditions raise substantial doubt regarding our ability to continue as a going concern for a period of at least one year from the date of issuance of these accompanying Condensed Consolidated Financial Statements.

In order to manage liquidity and operating capital, the Company has taken or plans to take the actions described below.

Financings under the 2024 Securities Purchase Agreement

As part of management’s plan to raise capital to fund operations, we have 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, par value of $0.001 per share (the “Common Stock”) and (ii) warrants (the “2024 Warrants”) to purchase shares of Common Stock.

During the three months ended March 31, 2025, the Company issued and sold to the Investor (i) 2024 Notes in the original principal amount of $38.5 million and (ii) 2024 Warrants to purchase up to 4.4 million shares of Common Stock (following adjustment for our 2025 Reverse Stock Split). During the three months ended June 30, 2025, the Company did not issue or sell to the Investor any additional notes and warrants. As of June 30, 2025, we had issued and sold to the Investor (i) 2024 Notes in the aggregate original principal amount of $77.5 million and (ii) 2024 Warrants to purchase up to 5.7 million shares of Common Stock pursuant to the 2024 Securities Purchase Agreement (following adjustment in connection with our 2024 Reverse Stock Split and our 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 aggregate principal amount of $35.0 million (the “Tenth Additional 2024 Note”) which is 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 a 12.5% original issue discount and related fees and expenses, were deposited into a lockbox account under the control of the collateral agent under the 2024 Securities Purchase Agreement. Funds may 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 we satisfy the conditions of a Market Release Event (as defined in the Lockbox Letter), including minimum Common Stock price and trading volume conditions; or (iii) otherwise, with the consent of the Investor. As of August 12, 2025, approximately $15.1 million of the gross proceeds of the Tenth Additional 2024 Note had been released from the lockbox account. 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. Furthermore, there is no

assurance that we will receive any additional proceeds beyond those from the Tenth Additional 2024 Note under the 2024 Securities Purchase Agreement.

As of June 30, 2025, $33.6 million aggregate principal amount remained outstanding under the 2024 Notes, and no shares had been issued pursuant to the 2024 Warrants. Upon our filing of one or more additional prospectus supplements, and our satisfaction of certain other conditions, as of June 30, 2025, the 2024 Securities Purchase Agreement contemplates additional closings of 2024 Notes of up to $61.5 million in aggregate principal amount of additional 2024 Notes and corresponding 2024 Warrants.

On August 15, 2025, the Company entered into the Repayment Agreement (as defined below), pursuant to which it agreed to repay its outstanding obligations under the 2024 Notes in connection with the Merger and exchange all of the Investor’s 2024 Warrants for rights to acquire shares of the Company’s Common Stock. In addition, the Investor waived its right to effect Additional Closings (as defined in the 2024 Securities Purchase Agreement for more information, see “Recent Developments—Waiver, Repayment and Exchange Agreement” below.

Recent Developments

Merger Agreement with Motiv Power Systems, Inc.

On August 15, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among Workhorse, Omaha Intermediate 2, Inc., a Delaware corporation and wholly-owned subsidiary of Workhorse, Omaha Intermediate, Inc., a Delaware corporation and wholly-owned subsidiary of Intermediate Parent (“Intermediate Parent”), Omaha Merger Subsidiary, Inc., a Delaware corporation and wholly-owned subsidiary of Intermediate (“Merger Subsidiary”), and Motiv Power Systems, Inc., a Delaware of corporation (“Motiv”), pursuant to which, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Merger Subsidiary will merge with and into Motiv (the “Merger”). Upon consummation of the Merger, Merger Sub will cease to exist and Motiv will become a direct, wholly-owned subsidiary of Intermediate and an indirect, wholly-owned subsidiary of Workhorse.

Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger, Motiv’s investors will receive a number of shares of Workhorse’s Common Stock, based on a ratio calculated in accordance with the Merger Agreement (the “Merger Consideration”). Upon closing of the Merger (the “Closing”), all of the issued and outstanding shares of Motiv’s common stock and preferred stock will be cancelled, and Workhorse will be the ultimate indirect parent of 100% of Motiv. In addition, all of the financial indebtedness of Motiv will be cancelled with the holders of such indebtedness receiving Workhorse Common Stock as Merger Consideration.

Upon the Closing and issuance of the Merger Consideration, on a pro forma basis and based upon the number of shares of Workhorse Common Stock expected to be issued in the Merger, pre-Merger Motiv investors will own approximately 62.5%, Workhorse stockholders as of immediately prior to Closing will own approximately 26.5%, and

SEC Form 10-Q filed by Workhorse Group Inc.