Item 1.02. Termination of a Material Definitive Agreement.
On January 27, 2023, Workhorse Group Inc. (the "Company") received a letter (the
"Notice") from Lordstown Motors Corp. (NASDAQ: RIDE) ("LMC") purporting to
terminate, effective March 27, 2023, the previously disclosed Intellectual
Property License Agreement dated November 7, 2019 between the Company and LMC
(the "Agreement"). As discussed more fully in the Company's Current Report on
Form 8-K filed with the Commission on November 7, 2019, the Agreement gives LMC
certain rights, including as to licensed intellectual property, related to
certain electric pickup trucks (the "Vehicles") in exchange for, among other
things, certain royalty and commission payments (the "Royalties") on LMC's sales
of those Vehicles. The Company believes that the Agreement provides that LMC's
obligation to pay the Royalties survives termination of the Agreement and that,
notwithstanding LMC's termination of the Agreement, the Royalties would still be
due and payable if LMC sells Vehicles. LMC has not informed the Company that it
has sold any Vehicles since the date of the Agreement. The Company cannot
currently predict to what extent, if at all, LMC will sell any such Vehicles,
whether LMC will pay the applicable Royalties on any such Vehicles it does sell,
or whether the amount of any such Royalties will be material.
This discussion is qualified in its entirety by the full text of the Agreement,
a copy of which is an exhibit to the Company's Annual Report on Form 10-K for
the year ended December 31, 2021.
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