Xos, Inc. entered into a definitive arrangement agreement to acquire Electrameccanica Vehicles Corp. for $12.6 million.
January 10, 2024
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Xos, Inc. (NasdaqCM:XOS) entered into a definitive arrangement agreement to acquire Electrameccanica Vehicles Corp. (NasdaqCM:SOLO) for $12.6 million on January 11, 2024. Xos will acquire all of the issued and outstanding common shares of ElectraMeccanica in an all-stock transaction. Upon closing of the transaciton, holders of ElectraMeccanica Shares will be entitled to receive a certain number of Xos Shares in exchange for the transfer to Xos of one ElectraMeccanica Share. Assuming Net Cash is greater than $46,500,000 and less than $50,500,000 and assuming the number of ElectraMeccanica Outstanding Shares and the number of Xos Outstanding Shares as of the Anticipated Effective Time are the numbers outstanding, respectively, as of January 24, 2024, the Consideration is expected to be 0.0142 of an Xos Share in exchange for each ElectraMeccanica Share, subject to certain adjustments.
Following the close of the transaction, ElectraMeccanica?s shareholders will own approximately 21.0% of Xos, subject to certain adjustments. The board of directors of the combined company will consist of nine directors, comprising six directors designated by Xos, including Xos co-founders Dakota Semler and Giordano Sordoni (who also serves as Xos? Chief Operating Officer), and three directors designated by ElectraMeccanica. The management team of Xos will continue to manage the business of the combined company following the completion of the transaction. In the event such termination fee is payable by Xos or ElectraMeccanica, Xos will be required to pay ElectraMeccanica or ElectraMeccanica will be required to pay Xos, respectively, a termination fee of $6 million. The transaction is subject to required approvals of Xos? stockholders and ElectraMeccanica?s shareholders, obtaining an interim order and final order from the Supreme Court of British Columbia approving the arrangement, the issuance of the consideration shares being exempt from the registration requirements of the Securities Act of 1933, the number of ElectraMeccanica Shares in respect of which ElectraMeccanica shareholders have validly exercised dissent rights not exceeding 7.5% of the ElectraMeccanica Shares issued and outstanding, the consideration shares to be issued under the arrangement shall be listed on the Nasdaq, certain third-party approvals and other customary closing conditions. The members of the boards of directors of both companies unanimously approved the proposed transaction. On March 20, 2024, Electrameccanica shareholders approved the arrangement at its special meeting of shareholders. The transaction is expected to close in the first half of 2024.
Greenhill & Co. Canada Ltd. is serving as financial advisor to ElectraMeccanica and also provided a fairness opinion to the ElectraMeccanica Board in connection with the proposed transaction. Greenhill will receive a fee of $3 million for its services with additional $0.5 million paid at the time of delivery of the Opinion. Snell & Wilmer L.L.P.; and David Frost and Gerald Gaunt of McCarthy Tétrault LLP are serving as legal counsel to ElectraMeccanica in connection with the proposed transaction. Houlihan Lokey is serving as financial advisor to Xos. David Peinsipp and Logan Tiari of Cooley LLP acted as legal counsel to Xos. Alex Gorka, David Davachi, Teresa Tomchak and Kaeleigh Kuzma of Osler, Hoskin & Harcourt LLP acted as legal advisor to Xos. Mackenzie Partners acted as proxy solicitation agent for the United States and Laurel Hill Advisory Group acted as proxy solicitation agent for Canada to ElectraMeccanica. The transfer agent for the Xos Shares will be Equiniti Trust Company, LLC. The transfer agent and registrar for the ElectraMeccanica Shares is VStock Transfer, LLC.
Xos, Inc. is a technology company. The Company is an electric truck manufacturer and fleet electrification services provider for battery-electric fleets. It designs and manufactures Class 5-8 battery-electric commercial vehicles that travel on last-mile, back-to-base routes of up to 200 miles per day. It also offers charging infrastructure products and services through Xos Energy Solutions to support electric vehicle fleets. The Companyâs proprietary fleet management software, Xosphere, integrates vehicle operation and vehicle charging to provide commercial fleet operators vehicle ownership experience than traditional internal combustion engine counterparts. It has developed the X-Platform (its proprietary, purpose-built vehicle chassis platform) and the X-Pack (its proprietary battery system) specifically for the medium- and heavy-duty commercial vehicle segment with a focus on last-mile commercial fleet operations. Its MD X-Platform include Commercial Stepvans and Armored Trucks.