Filed Pursuant to Rule 424(b)(3)
Registration No. 333-275553
PROSPECTUS SUPPLEMENT NO. 1
(to the prospectus dated December 19, 2023)
Next.e.GO N.V.
Up to 86,012,305 Ordinary Shares
This prospectus supplement supplements the prospectus dated December 19, 2023 (as supplemented or amended from time to time, the “Prospectus”), which forms a part of our registration statement on Form F-1 (No. 333-275553). This prospectus supplement is being filed to update and supplement the information in the Prospectus with the information contained in our report of foreign private issuer on Form 6-K furnished to the Securities and Exchange Commission on January 8, 2024 (the “Current Report”). Accordingly, we have attached the Current Report to this prospectus supplement.
The Prospectus and this prospectus supplement relate to the issuance by us of to 86,012,305 ordinary shares, nominal value of €0.12 per share (the “Ordinary Shares” or “Next.e.GO Shares”). These 86,012,305 Ordinary Shares consist of: (i) 49,019,608 Ordinary Shares that prior to the exchange for the contribution by the former shareholders of Next.e.GO Mobile SE (“e.GO”) of all of the paid-up shares in e.GO to Next.e.GO N.V. (f/k/a Next.e.GO B.V.) (“Next.e.GO” or “TopCo”) in exchange for shares in TopCo (the “Exchange”) were originally 161,905 shares in e.GO issued at prices on a converted and adjusted basis ranging from $0.24 - $16.53 per share, (ii) 10,000,000 vested Earn-Out Shares (as defined below) issued for no additional consideration at the time of issuance, (iii) 7,550,000 Ordinary Shares that were originally issued as Class B common stock of Athena Consumer Acquisition Corp. (“Athena”), which were subsequently converted into Ordinary Shares in connection with the Business Combination, purchased by the Athena Consumer Acquisition Sponsor, LLC (the “Sponsor”) for a price per share of approximately $0.003, (iv) 1,060,000 Ordinary Shares that were originally issued as Class A common stock of Athena, which were subsequently converted into Ordinary Shares in connection with the Business Combination, and, in addition, 92,750 Ordinary Shares, which were exchanged from 530,000 private placement warrants in connection with the Business Combination, whereby originally one Class A common stock and half of a private placement warrant constituted a unit, which was purchased by the Sponsor for a price per unit of $10.00, (v) 3,000,000 Ordinary Shares issued to the administrative agent on behalf of the lender as part of the share component agreed on under a certain settlement agreement for no additional consideration paid at the time of issuance in relation to the $15,000,000 bridge facility agreement entered into on September 29, 2022 by e.GO as borrower, Brucke Funding LLC as lender and Brucke Agent LLC as administrative agent, and any person which becomes a lender in accordance with the terms of the bridge facility agreement (the “Bridge Financing”), (vi) 500,000 Ordinary Shares issuable upon the exercise of 500,000 warrants exercisable at a price equal to the nominal value of the Ordinary Shares (currently approximately $0.13) based on a note purchase and guaranty agreement between TopCo, certain guarantors, UMB Bank, National Association, Echo IP Series 1 LLC and the note purchasers thereunder, dated as of June 30, 2023 (the “Penny Warrants”), (vii) 14,589,947 Ordinary Shares that may be issued to ACM ARRT M LLC upon conversion of an unsecured subordinated convertible note maturing October 19, 2028 issued at an aggregate purchase price of $11,726,616 (the “Note”) and (viii) 200,000 Ordinary Shares to be issued to Tribal Capital Markets, LLC (“TCM”) in satisfaction of an engagement agreement dated May 29, 2023 for no additional consideration. This prospectus and this prospectus supplement also cover any additional securities that may become issuable by reason of share splits, share dividends or other similar transactions.
Our Ordinary Shares are traded on the Nasdaq Global Market LLC (the “Nasdaq”) under the symbol “EGOX.” On January 5, 2024, the closing price per Ordinary Share as reported on Nasdaq was $0.43.
This prospectus supplement should be read in conjunction with the Prospectus, including any amendments or supplements thereto, which is to be delivered with this prospectus supplement. This prospectus supplement is qualified by reference to the Prospectus, including any amendments or supplements thereto, except to the extent that the information in this prospectus supplement updates and supersedes the information contained therein.
This prospectus supplement is not complete without, and may not be delivered or utilized except in connection with, the Prospectus, including any amendments or supplements thereto.
Investing in our ordinary shares involves risks that are described in the “Risk Factors” section beginning of page 18 of the Prospectus and under similar headings in any amendments or supplements to the Prospectus.
We are both an “emerging growth company” and a “foreign private issuer” as defined under applicable U.S. federal securities laws and, as such, may elect to comply with certain reduced public company reporting requirements for this and future filings. See “Prospectus Summary — Implications of Being an Emerging Growth Company” and “Prospectus Summary — Implications of Being a Foreign Private Issuer” in the Prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this Prospectus or determined if this prospectus supplement or the accompanying Prospectus is truthful or complete. Any representations to the contrary is a criminal offense.
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The date of this prospectus supplement is January 8, 2024.
Convertible Debt Issue and Committed Equity Financing
On January 4, 2024 (the “Effective Date”), Next.e.GO N.V. (the “Company”) entered into a standby equity purchase agreement (the “SEPA”) with YA II PN, Ltd., a Cayman Islands exempt limited partnership (“Yorkville”), a fund managed by Yorkville Advisors Global, LP, headquartered in Mountainside, New Jersey.
Under the SEPA, Yorkville shall advance to the Company the principal amount of $4,000,000 (the “Pre-Paid Advance”), which shall be evidenced by promissory notes (the “Promissory Notes”), which are convertible into ordinary shares of the Company, nominal value of €0.12 per share (the “Ordinary Shares”) (as converted, the “Conversion Shares”). 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 (as defined below). 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”). The Original Issue Discount shall not reduce the principal amount of each Promissory Note.
Principal, interest and any other payments due under the Promissory Notes shall be paid in cash on January 4, 2025 (the “Maturity Date”), unless converted by Yorkville or redeemed by the Company. Except as specifically permitted by 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, Yorkville 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 (such amount, the “Conversion Amount”) into Ordinary Shares at the Conversion Price (as defined below). The number of Conversion Shares issuable upon conversion of the Conversion Amount will be determined by dividing (x) such Conversion Amount by (y) the Conversion Price. The “Conversion Price” means, as of any conversion date or other date of determination and subject to adjustments set forth in the Promissory Notes, the lower of (i) $0.7056 per Ordinary Share, or (ii) 94% of the lowest daily VWAP (as defined below) during the 7 consecutive trading days immediately preceding the Conversion Date or other date of determination, but not lower than the greater of (i) $0.1026 per Ordinary Share or (ii) 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 (each, an “Optional Redemption”) early a portion or all amounts outstanding under the Promissory Notes, provided that the Company provides Yorkville with at least ten scheduled trading days’ prior written notice (each, a “Redemption Notice”) of its desire to exercise an Optional Redemption. Each Redemption Notice will be irrevocable and will specify the date for the Optional Redemption (each, a “Redemption Date”), the outstanding principal of the Promissory Notes to be redeemed and the Redemption Amount (as defined below) applicable to such principal. With respect to any Redemption Notice, the “Redemption Amount” will be an amount equal to the outstanding principal actually being redeemed by the Company (after giving effect to any conversions with a Conversion Date prior to the relevant Redemption Date) on the relevant Redemption Date, plus the Payment Premium, plus all accrued and unpaid interest on the principal amount being redeemed by the Company to, but excluding, the relevant Redemption Date. In addition, if an Amortization Event (as defined in the Promissory Notes) occurs, then the Company shall be required to make monthly payments in an amount equal to $1,000,000 of principal, or the outstanding principal if less than such amount, plus the Payment Premium, plus all accrued and unpaid interest on the principal amount being paid. “Payment Premium” means 7% of the principal amount being paid pursuant to a monthly payment or an Optional Redemption.
Yorkville 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. Upon the occurrence and during the continuance of any event of default, interest will accrue on the outstanding principal balance of the Convertible Debenture at a rate of 18% per annum.
Pursuant to the SEPA, subject to the terms and conditions set forth therein, the Company has the right, but not the obligation, to issue (each such issuance, an “Advance”) to Yorkville, and Yorkville has the obligation to subscribe for Ordinary Shares for an aggregate subscription amount of up to $150 million (the “Commitment Amount”), at any time from the date of the SEPA until February 1, 2027, unless earlier terminated pursuant to the SEPA (the “Commitment Period”), by delivering written notice to Yorkville (each, an “Advance Notice”). The Company will not have the right
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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 (as defined in the Promissory Notes) has occurred and the proceeds of any Advance is applied towards repayment of a balance under a Promissory Note.
At any time during the Commitment Period and provided that a balance under a Promissory Note is outstanding, Yorkville may, by providing written notice to the Company (an “Investor Notice”), require the Company to issue and sell shares to Yorkville as set out in the relevant Investor Notice, subject to certain limitations as set forth in the SEPA. The purchase price of the shares delivered pursuant to an Investor Notice shall be equal to the Conversion Price and shall be paid by offsetting the amount of the aggregate purchase price to be paid by Yorkville against an equal amount outstanding under the Promissory Note.
Otherwise, each Ordinary Share to be issued to Yorkville from time to time under the SEPA will be issued at one of two pricing options, at the election of the Company. Under the first option, the Company will sell the Ordinary Shares to Yorkville at 96% of the Market Price (as defined below) for any period commencing (a) if submitted to Yorkville prior to 9:00 a.m. Eastern Time on a trading day, the open of trading on such day or (b) if submitted to Yorkville after 9:00 a.m. Eastern Time on a trading day, upon receipt by the Company of written confirmation of acceptance of such Advance Notice by Yorkville, and which confirmation shall specify such commencement time, and, in either case, ending on 4:00 p.m. New York City time on the applicable date of the Advance Notice. Under the second option, the Company will sell the shares of Ordinary Shares to Yorkville at 97% of the Market Price for any three consecutive trading days commencing on the date of the Advance Notice. “Market Price” is defined as, for any first option pricing period, the daily volume weighted average price (“VWAP”) of the Ordinary Shares on Nasdaq during the first option pricing period, and for any second option pricing period, the lowest daily VWAP of the Ordinary Shares on the Nasdaq during the second option pricing period.
The SEPA does not require Yorkville to subscribe for or acquire any Ordinary Shares under the SEPA if those Ordinary Shares, when aggregated with all other Ordinary Shares acquired by Yorkville under the SEPA, would result in Yorkville beneficially owning more than 4.99% of the then outstanding Ordinary Shares.
The Company shall pay a commitment fee in an amount equal to $1,500,000 (the “Commitment Fee”), of which (i) $350,000 (the “Initial Commitment Fee”) 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 (the “Initial Commitment Shares”), and (ii) $1,150,000 (the “Deferred Commitment Fee”) 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.
The Company is unable to estimate the actual total amount of proceeds that it may receive under the SEPA, as it will depend on a number of factors, including the frequency and prices at which the Company issues Ordinary Shares to Yorkville, market conditions and the trading price of the Ordinary Shares, its ability to meet the conditions set forth in the SEPA, and determinations by the Company as to the appropriate sources of funding for the company and its operations.
The SEPA contains customary representations, warranties, conditions and indemnification obligations by each party. The representations, warranties and covenants contained in the SEPA were made only for purposes of the SEPA and as of specific dates, were solely for the benefit of the parties to such agreement and are subject to certain important limitations.
The obligations of the Company to Yorkville are guaranteed by Next.e.GO Mobile SE, a German public limited liability company and wholly-owned subsidiary of the Company, pursuant to a global guaranty agreement, dated January 4, 2024 (the “Global Guaranty Agreement”).
In connection with the transaction, the Company and Yorkville entered into a registration rights agreement, dated January 4, 2024 (the “Yorkville RRA”), pursuant to which the Company is required to register for resale all of the Initial Commitment Shares, the Ordinary Shares to be issued from time to time pursuant to an Advance, and the Deferred Commitment Shares, if any. The Company is required to file an initial registration statement (the “Initial Registration
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Statement”) covering the resale of the relevant Ordinary Shares, by no later than the 30th calendar day following execution of the Yorkville RRA. The Company is required to file additional registration statements covering the resale by Yorkville of relevant Ordinary Shares not covered by the Initial Registration Statement as soon as practicable.
The foregoing descriptions of the SEPA, the Promissory Note, the Global Guaranty Agreement and the Yorkville RRA are qualified in their entirety by the terms and conditions of the SEPA, the Promissory Notes, the Yorkville RRA and the Global Guaranty Agreement, which are attached as Exhibit 99.1, 99.2, 99.3 and 99.4, respectively, and which are incorporated herein by reference.
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EXHIBIT INDEX
Exhibit | | Description of Exhibit |
99.1† | | Standby equity purchase agreement, dated January 4, 2024, by and between Next.e.GO N.V. and YA II PN, Ltd. |
99.2 | | Form of Promissory Note. |
99.3 | | Registration Rights Agreement, dated January 4, 2024, by and between Next.e.GO N.V. and YA II PN, Ltd. |
99.4 | | Global Guaranty Agreement, dated January 4, 2024, by and between Next.e.GO Mobile SE and YA II PN, Ltd. |
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SIGNATURE
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, thereunto duly authorized.
| | Next.e.GO N.V. |
| | | By | | /s/ Eelco van der Leij |
| | | | | Name: | | Eelco van der Leij |
| | | | | Title: | | Executive Director |
Date: January 8, 2024
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