INFORMATION CONTAINED IN THIS REPORT ON FORM 6-K
In June 2023, Polestar entered into a joint venture for the China market (the “Joint Venture”) with Hubei Xingji Meizu Group Co., Ltd. (“Xingji Meizu”) where Polestar owns 49% of the Joint Venture. On February 29, 2024, the Joint Venture entered into a subscription agreement (the “Subscription Agreement”) with Nanjing Jiangning Economic and Technological Development Zone Industrial Equity Investment Partnership (Limited partnership) (the “Investor”). Pursuant to the Subscription Agreement, the Investor will purchase shares of the Joint Venture for an aggregate purchase price of CNY 1.5 billion, or approximately $208.4 million, by installments (the “Investment”). After the completion of second installment, the board of the Joint Venture shall consist of seven (7) directors, of which four (4) shall be appointed by Xingji Meizu, two (2) by Polestar Singapore and one (1) by the Investor.
Following the completion of the Investment, it is expected that Polestar will own approximately 37.64% of the Joint Venture, with Xingji Meizu owning 39.18% and the Investor owning 23.18%. The closing of the Investment is subject to certain conditions, and pursuant to the Subscription Agreement and a supplemental shareholder agreement, if certain triggering events occur, the Investor may demand the Joint Venture to repurchase its shares. Polestar will not be required to repurchase such shares, either directly or indirectly through a capital contribution to the Joint Venture.
In connection with the Investment, a supplemental shareholders agreement for the Joint Venture has also been signed. However, the governing rights of Polestar in the Joint Venture have not materially changed. Furthermore, Polestar and Xingji Meizu will continue to contribute capital to the Joint Venture as previously agreed upon in the initial shareholders agreement.
Forward-looking statements
Certain statements in this Form 6-K may be considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or the future financial or operating performance of Polestar including the number of vehicle deliveries and gross margin. For example, projections of revenue, volumes, margins, cash flow break-even and other financial or operating metrics and statements regarding expectations of future needs for funding and plans related thereto are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expect”, “intend”, “will”, “estimate”, “anticipate”, “believe”, “predict”, “potential”, “forecast”, “plan”, “seek”, “future”, “propose” or “continue”, or the negatives of these terms or variations of them or similar terminology. Such forward-looking statements are subject to risks, uncertainties, and other factors which could cause actual results to differ materially from those expressed or implied by such forward looking statements.
These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by Polestar and its management, as the case may be, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: (1) Polestar’s ability to maintain agreements or partnerships with its strategic partners, such as Volvo Cars, Geely or Xingji Meizu Group, and to develop new agreements or partnerships; (2) Polestar’s ability to maintain relationships with its existing suppliers, source new suppliers for its critical components and enter into longer term supply contracts and complete building out its supply chain, while effectively managing the risks due to such relationships; (3) Polestar’s reliance on its partnerships with vehicle charging networks to provide charging solutions for its vehicles and its reliance on strategic partners for servicing its vehicles and their integrated software; (4) Polestar’s reliance on its partners, some of which may have limited experience with electric vehicles, to manufacture vehicles at a high volume or develop devices, products, apps or operating systems for Polestar, and to allocate sufficient production capacity or resources to Polestar
