Next.e.GO N.V. announced that it has entered into a standby equity purchase agreement with new investor YA II PN, Ltd. managed by Yorkville Advisors Global LP to issue convertible promissory notes in the principal amount of $4,000,000 on January 4, 2024. The promissory notes are convertible into ordinary shares of the company. The first Pre-Paid Advance in a principal amount of $2,000,000 was advanced on the Effective Date, and the second Pre-Paid Advance shall equally be in a principal amount of $2,000,000 and advanced on the second trading day after the effectiveness of the Initial Registration Statement.

Each Pre-Paid Advance is subject to a discount in the amount equal to 7% of the principal amount of the Pre-Paid Advance netted from the purchase price due and structured as an original issue discount. The Original Issue Discount shall not reduce the principal amount of each Promissory Note. The notes shall mature on January 4, 2025 unless converted by investor or redeemed by the company.

Under the terms of the Promissory Notes, the company may not prepay or redeem any portion of the outstanding principal and accrued and unpaid interest thereunder. Subject to the terms set forth in the Promissory Notes, at any time on or after the issuance date, the investor shall be entitled to convert any portion of the outstanding principal of the Promissory Notes plus accrued and unpaid interest on such outstanding principal of the Promissory Notes to, but excluding, the conversion date into Ordinary Shares at the Conversion Price of the lower of $0.7056 per Ordinary Share, or 94% of the lowest daily VWAP during the 7 consecutive trading days immediately preceding the Conversion Date or other date of determination, but not lower than the greater of $0.1026 per Ordinary Share or the nominal value of one Ordinary Share. The Conversion Price will be adjusted from time to time pursuant to the terms and conditions of the Promissory Notes.

The company at its option and in its sole discretion shall have the right, but not the obligation, to redeem early a portion or all amounts outstanding under the Promissory Notes, provided that the company provides investor with at least ten scheduled trading days prior written notice of its desire to exercise an Optional Redemption. The investor may declare the full unpaid principal amount of the Promissory Notes, together with interest and other amounts owing in respect thereof, immediately due and payable in cash upon the occurrence of certain specified events of default and mandatory prepayment events. Pursuant to the SEPA, subject to the terms and conditions set forth therein, the company has the right, but not the obligation, to issue to Yorkville, and Yorkville has the obligation to subscribe for Ordinary Shares for an aggregate subscription amount of up to $150 million at any time from the date of the SEPA until February 1, 2027, unless earlier terminated pursuant to the SEPA by delivering written notice to Yorkville.

The company will not have the right to require Yorkville to subscribe for any Ordinary Shares under the SEPA if a balance remains outstanding under a Promissory Note, unless an Amortization Event has occurred and the proceeds of any Advance is applied towards repayment of a balance under a Promissory Note. The company shall pay a commitment fee in an amount equal to $1,500,000 of which $350,000 shall be paid within 2 days of the Effective Date of the SEPA by the issuance to Yorkville of such number of Ordinary Shares that is equal to the Initial Commitment Fee divided by the closing price of the Ordinary Shares as of the trading day immediately prior to the Effective Date and $1,150,000 shall be due and payable only if the company shall have received gross proceeds of at least $100 million under the SEPA by the one-year anniversary of the Effective Date. The Deferred Commitment Fee, if applicable, shall be paid on the one-year anniversary of the Effective Date, by the issuance to Yorkville of such number of Ordinary Shares that is equal to the Deferred Commitment Fee divided by the closing price of the Ordinary Shares as of the trading day immediately prior to the one-year anniversary of the Deferred Commitment Fee.