UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
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Item 1.01. Entry into a Material Definitive Agreement.
On January 31, 2024, in connection with the sale and leaseback transaction described herein, a subsidiary of Workhorse Group Inc. (the “Company”) entered into a Purchase and Sale Agreement (the “Sale Agreement”) with William Repny LLC (the “Purchaser”) for the sale of its Union City, Indiana manufacturing facility and campus, excluding any equipment or fixtures used in manufacturing operations (the “Property”), to Purchaser for a purchase price, before fees and expenses, of approximately $34.5 million.
Pursuant to the Sale Agreement and upon the closing of the sale of the Property, the Company will lease back the Property from the Purchaser under a triple-net lease agreement (the “Lease”) for an initial term of 20 years. The Company will have the option to renew the Lease for three additional 10-year renewal terms, subject to the terms of the Lease.
Under the Lease, the Company will pay base annual rent of approximately $3.375 million for the Property, subject to an annual increase of 3% during the initial term of the lease and certain additional increases during any renewal term. In addition to rent, the Company will be responsible for all costs and expenses related to the Property, including, without limitation, maintenance, operation, repair and replacement of buildings and improvements, utility charges, insurance premiums and real estate taxes and assessments.
The closing is subject to Purchaser performing satisfactory due diligence on the Property, obtaining financing and other customary closing conditions. There is no assurance at this time that the Purchaser will purchase the Property. The Company plans to use the proceeds for general corporate purposes.
The above description of the terms of the sale and leaseback transaction does not purport to be complete and is qualified in its entirety by the full text of the Sale Agreement which is filed as an exhibit to this Current Report on Form 8-K.
The Sale Agreement, which is filed as an exhibit to this report, contains provisions, including representations and warranties of the parties, that are intended only for the purpose of establishing a commercial relationship between the parties, including allocating risk between them. These representations and warranties speak only as of a specific date, are subject to transaction-specific, negotiated limitations, qualifications and standards of materiality and do not purport to be factually accurate statements about the matters they address. Accordingly, investors should not rely on such representations and warranties and other provisions as statements of fact about the Company or any other person.
Forward-Looking Statements
Certain statements in this Current Report on Form 8-K are forward-looking statements that involve a number of risks and uncertainties. For such statements, the Company claims the protection of the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from the Company’s expectations. Additional factors that could cause actual results to differ materially from those stated or implied by the Company’s forward-looking statements are disclosed in the Company’s reports filed with the Commission.
Item 9.01. Exhibits.
| Exhibit No. | Description | |
| 10.1 | Purchase and Sale Agreement. | |
| 104 | Cover page from this Current Report on Form 8-K, formatted as Inline XBRL. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WORKHORSE GROUP INC. | ||
| Date: January 31, 2024 | By: | /s/ James D. Harrington |
| Name: | James D. Harrington | |
| Title: | General Counsel, Chief Compliance Officer and Secretary | |
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