NWTN : Status of Evergrande Transaction - Form 6-K

Status of Evergrande Transaction

As previously reported by NWTN Inc., a Cayman Islands exempted company ("NWTN"), on a Current Report on Form 6-K (the "Original 6-K") filed with the Securities and Exchange Commission (the "SEC") on August 14, 2023, NWTN is a party to that certain share subscription agreement (the "Share Subscription Agreement") with China Evergrande Group, a Cayman Islands exempted company listed on the Main Board of The Stock Exchange of Hong Kong Limited (the "Hong Kong Stock Exchange") (Stock Code: 3333) (the "Evergrande Group"), China Evergrande New Energy Vehicle Group Limited, a company with limited liability incorporated in the Hong Kong Special Administrative Region of the People's Republic of China and listed on the Hong Kong Stock Exchange (Stock Code: 0708) (the "Target", together with its subsidiaries, the "Target Group") and Hui Ka Yan. Pursuant to the Share Subscription Agreement, NWTN agreed to subscribe for 6,177,106,404 of newly issued ordinary shares of the Target (the "Subscription Shares") for an aggregate subscription price of HK$3,889,723,903, implying a subscription price of HK$0.6297 per Subscription Share (the transactions contemplated by the Share Subscription Agreement, the "Proposed Transactions"). Unless otherwise defined herein, the capitalized terms used below have the meanings given to them in the Share Subscription Agreement.

On September 28, 2023, Target announced that trading of Target's ordinary shares on the Hong Kong Stock Exchange was suspended. As previously disclosed on the Original 6-K, Target's ordinary shares remaining listed on the Hong Kong Stock Exchange is a condition to the consummation of the transactions contemplated by the Share Subscription Agreement.

On September 29, 2023, NWTN delivered a letter to Target notifying Target (the "September 29 Letter") that NWTN has suspended the performance of its obligations under the Share Subscription Agreement due to, among other things, the trading halt of Target's ordinary shares on the Hong Kong Stock Exchange and a series of recent changes in the Evergrande Group have generated significant uncertainties on the likelihood of Target being able to meet various closing conditions for the Proposed Transactions, including but not limited to the Target's ordinary shares remaining listed on the Hong Kong Stock Exchange; no material adverse event as of the Closing Date; the Hong Kong Stock Exchange approving the listing and trading of the Subscription Shares; and Evergrande Group's ability to effect its debt restructuring plan (the "Evergrande Debt Restructuring Plan"). NWTN also requested an update from Target on the status of the Evergrande Debt Restructuring Plan and contemplated adjustments thereto.

As also previously reported on the Original 6-K, NWTN (Zhejiang) Automobile Co., Ltd., an affiliate of NWTN (the "Fund Provider"), and Evergrande New Energy Vehicle (Tianjin) Co., Ltd. , an affiliate of Target (the "Fund Recipient"), entered into that certain Transitional Funding Support Agreement (the "Transition Funding Support Agreement"), pursuant to which the Fund Provider shall, subject to the satisfaction of certain conditions precedent, provide a secured transitional funding in the amount of RMB600 million (the "Transitional Support Amount") in three equal tranches to the Fund Recipient for the research and development, manufacturing of and sales services in respect of vehicles of Target Group.

In the September 29 Letter, NWTN informed Target that the recent developments with the Evergrande Group described above have caused the conditions precedent to Fund Provider's obligation to fund the second and third tranches of the Transitional Support Amount to not be satisfied. Therefore, the Fund Provider is currently not obligated, and has not paid, any of the second and third tranches.

While it has not initiated immediate steps to terminate either the Share Subscription Agreement or the Transition Funding Support Agreement, NWTN will continue to seek updates from Target on the Evergrande Debt Restructuring Plan, and to evaluate its impact on the Proposed Transactions before it decides how to proceed on the Proposed Transactions.