Brett_Hondow Investment Thesis After a nearly 30% drop, Ulta (NASDAQ:ULTA) is trading at 15 times earnings. This may not seem like a bargain to some of you, but considering the quality of the business and the opportunity for expansion in Mexico, which will begin next 2025 and would be arriving just after growth appears to be slowing, I think it is an investment option that should be taken into account. Outstanding Business Ulta operates beauty and personal care products stores. In their stores they sell bea ...

Arrival SA (NASDAQ:ARVL), the British electric van manufacturer, revealed its UK operations entered administration on Tuesday. Once valued at £9 billion and favoured by ex-Prime Minister Boris Johnson, the Banbury-based company faced significant challenges in its plan to bring its electric vans, buses, and taxis to the market at a relatively low cost. Arrival aimed to approach electric vehicle production with its ‘micro-factory’ concept, intended for simpler, more cost-effective manufacturing at a smaller s ...

Core Insights - Arrival's UK division is entering administration, indicating a significant financial crisis for the company [1] - The company is attempting to sell its UK assets and intellectual property to repay lenders [1] - Arrival's stock was recently delisted from Nasdaq, and the company previously secured a $300 million lifeline to stabilize operations [1] - The company's valuation has plummeted from over $13 billion to approximately $9 million [2] Company Developments - Arrival's initial vision involved creating electric commercial vans and buses in compact "microfactories" located in urban areas, which has not materialized [2] - The company has faced continuous financial losses and has diversified into various projects, including an electric bus and a vehicle for Uber, without success [2] - Arrival has undergone multiple executive changes and restructurings, resulting in layoffs during each phase [2] Market Strategy - In 2022, Arrival shifted its focus from the UK to the US market as part of a restructuring effort to conserve capital [3] - Despite this pivot, the company has failed to produce and deliver any commercial vehicles [3]

Group 1 - Arrival is being removed from the Nasdaq stock exchange as it approaches dissolution, with trading suspension effective January 30 [1] - The company failed to post financial results on time and did not file a remediation plan with Nasdaq [1] - Arrival had previously secured a $50 million lifeline to explore asset sales but is now in talks with EY for an administration process similar to bankruptcy [1] Group 2 - Arrival aimed to revolutionize electric vehicle production through microfactories, achieving a valuation of $13 billion after going public in 2021 [2] - The company has struggled to operationalize its business model, leading to multiple layoffs and a failed merger attempt with another SPAC [2] - Arrival's current valuation is approximately $20 million, and it has not delivered a fully operational vehicle to customers like UPS or Uber [2]

Arrival (NASDAQ:ARVL) Q1 2023 Earnings Conference Call May 15, 2023 4:30 AM ET Company Participants Annie Wechter - Director IR Igor Torgov - CEO Michael Ableson - CEO of North America John Wozniak - CFO Conference Call Participants Jeffrey Osborne - Cowen Operator Call starts abruptly… Annie Wechter …to discuss Arrival's first quarter 2023 business update. I'm Annie Wechter, Director of Investor Relations. And today, we have with us Igor Torgov, Arrival Group CEO; Mike Ableson, CEO of North America; and Jo ...

Arrival (NASDAQ:ARVL) Q4 2022 Earnings Conference Call March 13, 2023 4:30 PM ET Company Participants Annie Wechter - Director IR Igor Torgov - CEO Michael Ableson - CEO of North America John Wozniak - CFO Conference Call Participants Jeffrey Osborne - Cowen Operator Hello, everyone, and Welcome to Arrival's Fourth Quarter and Full Year 2022 Business Update Webinar. My name is Mike, and I'll be your operator today. Before I hand the call over to the Arrival team, I'd just like to go over a few housekeeping ...

[Share Purchase Agreement](index=1&type=section&id=Share%20Purchase%20Agreement) This agreement enables the Company to sell up to **$300,000,000** in ordinary shares to the Investor under specific terms and conditions [Agreement Overview](index=6&type=section&id=Agreement%20Overview) This Share Purchase Agreement, entered into on March 10, 2023, allows the Company to sell and obligates the Investor to purchase up to **$300,000,000** of newly issued ordinary shares over time, subject to specified terms and conditions Key Agreement Terms | Term | Details | | :--- | :--- | | **Agreement Date** | March 10, 2023 | | **Parties** | Arrival (Company) and Westwood Capital Group LLC (Investor) | | **Total Commitment** | Up to **$300,000,000** in Ordinary Shares | - The sales of Ordinary Shares will be conducted in reliance upon Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D[10](index=10&type=chunk) - Concurrently, the parties are entering into a Registration Rights Agreement to register the resale of the purchased shares[10](index=10&type=chunk) - As consideration for the agreement, the Company will issue Commitment Shares to the Investor[10](index=10&type=chunk) [ARTICLE I: DEFINITIONS](index=6&type=section&id=ARTICLE%20I%20DEFINITIONS) This article defines key capitalized terms used throughout the agreement to ensure consistent interpretation [Definitions](index=6&type=section&id=Definitions) This article states that capitalized terms used throughout the agreement are defined in Annex I, which is incorporated by reference - Capitalized terms used in the Agreement have the meanings defined in Annex I or as otherwise defined within the Agreement itself[12](index=12&type=chunk) [ARTICLE II: PURCHASE AND SALE OF ORDINARY SHARES](index=7&type=section&id=ARTICLE%20II%20PURCHASE%20AND%20SALE%20OF%20ORDINARY%20SHARES) This article details the terms for the purchase and sale of ordinary shares, including closing procedures and public disclosure requirements [Purchase and Sale of Shares](index=7&type=section&id=Section%202.1%20Purchase%20and%20Sale%20of%20Shares) This section establishes the Company's right, but not obligation, to sell up to **$300,000,000** of its Ordinary Shares to the Investor during the Investment Period, with the Investor obligated to purchase these shares when the Company delivers a VWAP Purchase Notice Commitment Details | Item | Value | | :--- | :--- | | **Total Commitment** | **$300,000,000** | | **Mechanism** | Company's discretion via VWAP Purchase Notices | [Closing; Closing Date](index=7&type=section&id=Section%202.2%20Closing%3B%20Closing%20Date) The agreement becomes effective and binding at the Closing, which occurs upon the execution and delivery of the Agreement and the Registration Rights Agreement, receipt of the Promissory Note by the Investor, and delivery of all other required documents - The Closing Date is March 10, 2023, the date of the agreement[14](index=14&type=chunk) - Closing is contingent on the delivery of signed counterpart pages for the Share Purchase Agreement and Registration Rights Agreement, and the Investor's receipt of the Promissory Note[14](index=14&type=chunk) [Initial Public Announcements and Required Filings](index=7&type=section&id=Section%202.3%20Initial%20Public%20Announcements%20and%20Required%20Filings) The Company is required to publicly disclose the transaction by filing a Form 6-K with the SEC within four trading days and a Form D within 15 calendar days, while the Investor must maintain confidentiality until public disclosure - The Company must file a Form 6-K describing the transaction within four Trading Days of the agreement date[15](index=15&type=chunk) - A Form D must be filed within fifteen calendar days following the Closing Date[15](index=15&type=chunk) - The Company must file an Initial Registration Statement to cover the resale of Registrable Securities by the Investor as soon as practicable[17](index=17&type=chunk) [ARTICLE III: PURCHASE TERMS](index=8&type=section&id=ARTICLE%20III%20PURCHASE%20TERMS) This article outlines the specific terms for share purchases, including VWAP mechanics, settlement procedures, and beneficial ownership limitations [VWAP Purchases](index=8&type=section&id=Section%203.1%20VWAP%20Purchases) This section details the process for VWAP Purchases, where the Company can initiate a purchase by sending a VWAP Purchase Notice, subject to conditions like a minimum share price, a 'Quiet Period' between purchases, and a prohibition on capital raising until settlement, with the Investor obligated to accept valid notices - The Company may not deliver a VWAP Purchase Notice if the prior day's Closing Sale Price is below the Minimum Price[18](index=18&type=chunk) - A 'Quiet Period' prevents the Company from issuing a new VWAP Purchase Notice until the previous one has settled[18](index=18&type=chunk)[20](index=20&type=chunk) - The Company is prohibited from raising additional capital from the delivery of a VWAP Purchase Notice until the day after its settlement[20](index=20&type=chunk) [Settlement](index=9&type=section&id=Section%203.2%20Settlement) Settlement for each VWAP Purchase occurs on the third trading day following the notice, involving the Investor's initial par value payment, the Company's share delivery via DWAC, and the Investor's subsequent contribution of the remaining purchase price to a special equity reserve account (Account 115) - Settlement is a three-step process on the third Trading Day (VWAP Purchase Settlement Date) after the purchase notice[21](index=21&type=chunk) - The purchase price is split into two payments: a Par Value Settlement Payment and a subsequent contribution to the Company's special equity reserve account (Account 115)[21](index=21&type=chunk)[23](index=23&type=chunk) - If the Company fails to deliver shares on time, it may be required to pay the Investor's 'Cover Price' for replacement shares purchased in the open market[23](index=23&type=chunk) [Compliance with Rules of Trading Market](index=10&type=section&id=Section%203.3%20Compliance%20with%20Rules%20of%20Trading%20Market) This section mandates that the Company shall not issue or sell any shares under this agreement if such an action would be expected to violate the Securities Act or the rules of the Trading Market - The Company is prohibited from issuing shares if it would result in a violation of the Securities Act or a breach of Trading Market rules[23](index=23&type=chunk) [Beneficial Ownership Limitation](index=10&type=section&id=Section%203.4%20Beneficial%20Ownership%20Limitation) The agreement imposes a beneficial ownership limit on the Investor, capping ownership at **4.99%** of the Company's outstanding Ordinary Shares, with the Investor having sole discretion to increase this limit to **9.99%** - The Investor's beneficial ownership is capped at **4.99%** of the Company's outstanding Ordinary Shares[24](index=24&type=chunk) - The Investor may, at its discretion, increase the ownership limitation to **9.99%**[24](index=24&type=chunk)[26](index=26&type=chunk) [ARTICLE IV: REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE INVESTOR](index=11&type=section&id=ARTICLE%20IV%20REPRESENTATIONS%2C%20WARRANTIES%20AND%20COVENANTS%20OF%20THE%20INVESTOR) This article details the Investor's representations, warranties, and covenants regarding its legal status, investment intent, and compliance [Investor Representations (Sections 4.1-4.13)](index=11&type=section&id=Investor%20Representations) The Investor provides several representations and warranties, confirming its legal status, authority, and investment intent, including being an 'accredited investor,' acquiring securities for investment purposes and not for public distribution, not being an affiliate of the Company, and acknowledging its status as a statutory underwriter for resales - The Investor is a duly organized limited liability company in Delaware with the authority to enter into the agreement (Sec 4.1, 4.2)[27](index=27&type=chunk)[28](index=28&type=chunk) - The Investor confirms it is an 'accredited investor' as defined in Rule 501(a) of Regulation D and is acquiring the securities for its own account for investment purposes (Sec 4.4, 4.5)[31](index=31&type=chunk)[32](index=32&type=chunk) - The Investor is not an affiliate of the Company and has not engaged in short sales or hedging activities related to the Company's securities prior to the agreement (Sec 4.10, 4.11)[36](index=36&type=chunk)[37](index=37&type=chunk) - The Investor acknowledges it will be disclosed as an 'underwriter' in the Registration Statement for the resale of the securities (Sec 4.12)[38](index=38&type=chunk) [ARTICLE V: REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY](index=14&type=section&id=ARTICLE%20V%20REPRESENTATIONS%2C%20WARRANTIES%20AND%20COVENANTS%20OF%20THE%20COMPANY) This article outlines the Company's extensive representations and warranties concerning its corporate status, financial health, operational compliance, and securities matters [Corporate and Financial Representations (Sections 5.1-5.12)](index=14&type=section&id=Corporate%20and%20Financial%20Representations) The Company makes extensive representations regarding its corporate standing, capitalization, and financial health, including confirming its valid existence, authorization to enter the agreement, accuracy of its SEC filings and financial statements (prepared under IFRS), effectiveness of internal controls, and absence of material adverse effects, undisclosed liabilities, or insolvency proceedings - The Company and its subsidiaries are duly organized and in good standing (Sec 5.1)[40](index=40&type=chunk) - All SEC documents filed since March 24, 2021, comply with regulations and do not contain material misstatements, with financial statements prepared in accordance with IFRS (Sec 5.7)[49](index=49&type=chunk)[52](index=52&type=chunk) - The Company maintains effective internal controls over financial reporting and disclosure controls and procedures (Sec 5.7)[54](index=54&type=chunk)[55](index=55&type=chunk) - Since the last audited financial statements, there has been no Material Adverse Effect on the Company (Sec 5.9)[58](index=58&type=chunk) [Operational and Compliance Representations (Sections 5.13-5.30)](index=20&type=section&id=Operational%20and%20Compliance%20Representations) The Company represents that it has title to its assets, is in compliance with all applicable laws, and possesses necessary permits and intellectual property rights to operate its business, confirming no undisclosed legal proceedings, compliance with environmental and labor laws, proper handling of affiliate transactions, and that the offering is exempt from registration and does not involve general solicitation - The Company and its subsidiaries have good title to their material assets (Sec 5.13)[62](index=62&type=chunk) - The business is being conducted in compliance with all applicable laws, and the Company possesses all material permits and authorizations (Sec 5.15, 5.18)[65](index=65&type=chunk)[69](index=69&type=chunk) - The Company is not a party to any contract with a labor union and is in material compliance with employment laws (Sec 5.22)[78](index=78&type=chunk) - The offer and sale of securities to the Investor are exempt from registration requirements under Section 4(a)(2) and Rule 506(b) of Regulation D (Sec 5.28)[85](index=85&type=chunk) [Securities and Anti-Fraud Representations (Sections 5.31-5.43)](index=26&type=section&id=Securities%20and%20Anti-Fraud%20Representations) The Company acknowledges the potential dilutive effect of the share issuance, represents that it has not manipulated its stock price, and confirms its shares are listed on the Trading Market and are DTC eligible, while also affirming compliance with anti-corruption (FCPA), anti-money laundering, and OFAC regulations, and stating it is not subject to 'Bad Actor' disqualifications under Rule 506(d) - The Company acknowledges the issuance of securities could cause dilution to existing shareholders (Sec 5.31)[88](index=88&type=chunk) - The Company's Ordinary Shares are registered under Section 12(b) of the Exchange Act, listed on the Trading Market, and eligible for DTC's DWAC system (Sec 5.34)[91](index=91&type=chunk) - The Company represents compliance with anti-corruption laws like the FCPA, anti-money laundering laws, and OFAC sanctions (Sec 5.36, 5.37, 5.38)[94](index=94&type=chunk)[95](index=95&type=chunk)[96](index=96&type=chunk) - No 'Issuer Covered Person' is subject to 'Bad Actor' disqualifications under Rule 506(d)(1) of the Securities Act (Sec 5.40)[99](index=99&type=chunk) [ARTICLE VI: ADDITIONAL COVENANTS](index=31&type=section&id=ARTICLE%20VI%20ADDITIONAL%20COVENANTS) This article establishes ongoing covenants for both the Company and the Investor, including share reservation, listing maintenance, and trading restrictions [Company and Investor Covenants (Sections 6.1-6.15)](index=31&type=section&id=Company%20and%20Investor%20Covenants) This article outlines ongoing obligations for both parties, with the Company covenanting to reserve sufficient shares, maintain its stock exchange listing, and keep the registration statement effective, while agreeing not to enter into conflicting agreements or certain 'Variable Rate Transactions,' and the Investor covenanting to comply with selling restrictions, including a prohibition on short sales during the Restricted Period, and to use a broker-dealer for resales - The Company will reserve and keep available sufficient authorized but unissued Ordinary Shares to fulfill its obligations under the agreement (Sec 6.2)[107](index=107&type=chunk) - The Company will use commercially reasonable efforts to maintain its listing on the Trading Market (Sec 6.3)[108](index=108&type=chunk) - The Company is prohibited from entering into any 'Variable Rate Transactions' (e.g., certain convertible debt with floating conversion prices), with specified exceptions (Sec 6.6)[115](index=115&type=chunk) - The Investor agrees not to engage in any Short Sales of Ordinary Shares during the Restricted Period (from execution until termination) (Sec 6.9)[118](index=118&type=chunk) [ARTICLE VII: CONDITIONS TO CLOSING, COMMENCEMENT AND VWAP PURCHASES](index=36&type=section&id=ARTICLE%20VII%20CONDITIONS%20TO%20CLOSING%2C%20COMMENCEMENT%20AND%20VWAP%20PURCHASES) This article specifies the conditions precedent that must be satisfied for the agreement to become effective, for share purchases to commence, and for subsequent VWAP purchases to proceed [Conditions Precedent to Closing](index=36&type=section&id=Section%207.1%20Conditions%20Precedent%20to%20Closing) This section lists the conditions that must be met for the agreement to become legally binding, including the accuracy of representations and warranties from both parties, the Company's payment of the Investor's expense reimbursement, and the delivery of all required legal documents and opinions - The representations and warranties of both the Investor and the Company must be true and correct in all material respects[131](index=131&type=chunk)[132](index=132&type=chunk) - The Company must pay the Investor Expense Reimbursement as defined in Section 10.1(i)[134](index=134&type=chunk) - Counterpart signature pages of the Agreement, Registration Rights Agreement, and Promissory Note must be delivered, along with legal opinions and closing certificates[135](index=135&type=chunk) [Conditions Precedent to Commencement](index=37&type=section&id=Section%207.2%20Conditions%20Precedent%20to%20Commencement) This section outlines a comprehensive set of conditions that must be satisfied before the Company can begin issuing VWAP Purchase Notices, including the SEC declaring the Initial Registration Statement effective, the issuance of the Commitment Shares to the Investor, the absence of any trading suspension, and the completion of a reverse stock split and par value reduction - The Initial Registration Statement covering the resale of securities must be declared effective by the SEC[139](index=139&type=chunk) - The Company must issue the Commitment Shares to the Investor, valued at **$3,000,000**, against the set-off of the Promissory Note[150](index=150&type=chunk) - The Company must effect a reverse stock split to ensure the post-split share price is not less than **$4.00**[155](index=155&type=chunk) - The par value of the Ordinary Shares must be reduced to an amount less than or equal to **$0.01**[155](index=155&type=chunk) [Conditions Precedent to VWAP Purchases after Commencement Date](index=41&type=section&id=Section%207.3%20Conditions%20Precedent%20to%20VWAP%20Purchases%20after%20Commencement%20Date) For each VWAP Purchase after the initial Commencement, a set of conditions must be met at the time of the purchase notice, largely mirroring the commencement conditions, ensuring the Company's representations remain accurate, the registration statement remains effective, shares remain listed and tradable without suspension, and all prior share deliveries have been completed - The Company's representations and warranties must remain true and correct[157](index=157&type=chunk) - The applicable Registration Statement must be effective, and the Prospectus must be usable for resales by the Investor[158](index=158&type=chunk)[159](index=159&type=chunk) - Trading in the Ordinary Shares must not be suspended, and the shares must remain listed on an eligible market[167](index=167&type=chunk) - All shares from prior VWAP Purchases must have been successfully delivered to the Investor as DWAC Shares[168](index=168&type=chunk) [ARTICLE VIII: TERMINATION](index=45&type=section&id=ARTICLE%20VIII%20TERMINATION) This article defines the conditions under which the agreement will terminate, including automatic triggers and specific termination rights for both parties, and outlines the effects of such termination [Automatic Termination](index=45&type=section&id=Section%208.1%20Automatic%20Termination) The agreement will terminate automatically upon the earliest occurrence of several events: the 36-month anniversary of the Closing Date, the Investor purchasing the full **$300,000,000** commitment, the delisting of the Company's shares, or the commencement of bankruptcy proceedings - The agreement terminates automatically on the 36-month anniversary of the Closing Date[171](index=171&type=chunk) - Termination occurs if the Investor purchases the full Total Commitment of **$300,000,000**[171](index=171&type=chunk) - Delisting from the Trading Market or an Eligible Market, or the initiation of bankruptcy proceedings, will also trigger automatic termination[171](index=171&type=chunk) [Other Termination](index=45&type=section&id=Section%208.2%20Other%20Termination) This section provides termination rights to both parties, allowing the Company to terminate with one trading day's notice after Commencement, and the Investor to terminate for specific causes such as a material adverse effect, a fundamental transaction, failure by the Company to file or maintain an effective registration statement, or a material breach of the agreement by the Company - The Company may terminate the agreement with one Trading Day's written notice[172](index=172&type=chunk) - The Investor has the right to terminate if a Material Adverse Effect occurs, a Fundamental Transaction occurs, or the Company breaches its obligations under the Registration Rights Agreement[172](index=172&type=chunk) [Effect of Termination](index=46&type=section&id=Section%208.3%20Effect%20of%20Termination) Upon termination, the agreement becomes void, but certain provisions survive, including indemnification, miscellaneous clauses, and specific covenants which remain in effect for six months, with termination not affecting any pending VWAP purchases or the Investor's rights under the Registration Rights Agreement or its ownership of the Commitment Shares - Certain articles, including Indemnification (IX) and Miscellaneous (X), survive termination indefinitely[175](index=175&type=chunk) - Termination does not cancel any pending VWAP Purchase; both parties must fulfill their obligations for any outstanding purchase[175](index=175&type=chunk) - The Commitment Shares are considered fully earned as of the Closing Date and are unaffected by termination[175](index=175&type=chunk) [ARTICLE IX: INDEMNIFICATION](index=47&type=section&id=ARTICLE%20IX%20INDEMNIFICATION) This article details the Company's obligation to indemnify the Investor for losses arising from breaches of the agreement and outlines the procedures for handling such claims [Indemnification of Investor](index=47&type=section&id=Section%209.1%20Indemnification%20of%20Investor) The Company agrees to indemnify and hold harmless the Investor and its affiliates from any losses, damages, or costs arising from any breach of representations, warranties, or covenants by the Company in the transaction documents, or from any legal action instituted against the Investor related to the agreement - The Company will indemnify the Investor Party for Damages resulting from the Company's breach of representations, warranties, or covenants[178](index=178&type=chunk) - Indemnification also covers Damages from legal proceedings against the Investor Party arising from the transaction documents, unless the Damages resulted from the Investor's fraud, bad faith, or gross negligence[178](index=178&type=chunk) [Indemnification Procedures](index=48&type=section&id=Section%209.2%20Indemnification%20Procedures) This section outlines the process for an indemnification claim, requiring the Investor to promptly notify the Company, which has the right to assume the defense of the claim with its own counsel, and cannot settle a claim without the Investor's consent unless the settlement includes an unconditional release of the Investor - The Investor must notify the Company in writing after receiving notice of a claim for which it seeks indemnification[182](index=182&type=chunk) - The Company may assume the defense of the claim, but if a conflict of interest exists, it must pay for the Investor's separate counsel[182](index=182&type=chunk) - The Company cannot settle a claim without an unconditional release of the Investor Party from all liability, unless the Investor Party consents[182](index=182&type=chunk) [ARTICLE X: MISCELLANEOUS](index=49&type=section&id=ARTICLE%20X%20MISCELLANEOUS) This article contains standard legal provisions, including expense reimbursement, commitment share issuance, governing law, and dispute resolution mechanisms [Fees, Expenses, and Commitment Shares](index=49&type=section&id=Section%2010.1%20Certain%20Fees%20and%20Expenses%3B%20Commitment%20Shares%3B%20Commencement%20Irrevocable%20Transfer%20Agent%20Instructions) This section details financial considerations and share issuance mechanics, including the Company's responsibility for reimbursing the Investor's expenses up to **$150,000**, the issuance of Commitment Shares valued at **$3,000,000** as consideration, and the process for providing irrevocable instructions to the transfer agent to issue all shares as unlegended DWAC shares after the registration statement is effective Financial Considerations | Item | Amount | Details | | :--- | :--- | :--- | | **Investor Expense Reimbursement** | Up to **$150,000** | To cover the Investor's out-of-pocket expenses, including legal fees | | **Commitment Shares** | **$3,000,000** | Issued to the Investor as consideration for entering the agreement | - The Commitment Shares are considered fully earned at Closing, regardless of whether any VWAP Purchases occur[186](index=186&type=chunk) - The Company must provide its transfer agent with irrevocable instructions to issue all securities post-Commencement as DWAC shares without restrictive legends[189](index=189&type=chunk)[191](index=191&type=chunk) [General Provisions (Sections 10.2-10.16)](index=51&type=section&id=General%20Provisions) This part of the article contains standard legal clauses governing the agreement, including consent to jurisdiction in New York courts, a waiver of jury trial, confirmation that the transaction documents constitute the entire agreement, establishment of New York law as governing, and specification of which clauses survive termination - Both parties agree to specific performance and injunctions as remedies for breaches and waive the right to a jury trial (Sec 10.2)[192](index=192&type=chunk)[196](index=196&type=chunk) - The agreement is governed by the laws of the State of New York (Sec 10.11)[207](index=207&type=chunk) - The Company must provide the Investor a reasonable opportunity to review and comment on any public disclosures related to the transaction (Sec 10.14)[211](index=211&type=chunk) - Representations, warranties, and covenants in Articles V, VIII, IX, and X survive the termination of the agreement indefinitely (Sec 10.12)[209](index=209&type=chunk) [Annex I: Definitions](index=59&type=section&id=Annex%20I.%20Definitions) This annex provides comprehensive definitions for key capitalized terms used throughout the Share Purchase Agreement to ensure clarity and consistent interpretation [Defined Terms](index=59&type=section&id=Defined%20Terms) This annex provides detailed definitions for the capitalized terms used throughout the Share Purchase Agreement, clarifying the specific meaning of terms such as 'VWAP Purchase Price', 'Total Commitment', 'Material Adverse Effect', and 'Fundamental Transaction' to ensure precise interpretation of the contract - Defines 'Commitment Shares' as **$3,000,000** worth of Ordinary Shares, with the share count determined by a formula based on the Closing Sale Price[221](index=221&type=chunk) - Defines 'VWAP Purchase Price' with two different calculation methods: a 'Forward VWAP Purchase' at **97%** of the 3-day average VWAP, and an 'Alternative VWAP Purchase' at **95%** of the lowest daily VWAP over 3 days[255](index=255&type=chunk)[256](index=256&type=chunk) - Defines 'Minimum Price' as **$0.10**, which acts as a floor for the Company to be able to initiate a VWAP Purchase[237](index=237&type=chunk)

Arrival (NASDAQ:ARVL) Q3 2022 Earnings Conference Call November 8, 2022 8:00 AM ET Company Participants Annie Wechter - Director of Investor Relations Avinash Rugoobur - President John Wozniak - CFO Mike Ableson - CEO of Automotive Denis Sverdlov - Arrival Founder and CEO Conference Call Participants Jeffrey Osborne - Cowen Steven Fisher - UBS Operator Hello, everyone, and welcome to Arrival’s Third Quarter 2022 Earnings Webinar. My name is Mike, and I'll be your operator today. Before I hand the call over ...

[Form 6-K Filing Information](index=1&type=section&id=Form%206-K%20Filing%20Information) This Form 6-K recasts Arrival's financial statements for three years ended December 31, 2021, to reflect a change in reporting currency from Euro to U.S. dollar, effective Q1 2022 [Filing Overview](index=1&type=section&id=Filing%20Overview) This Form 6-K recasts Arrival's financial statements for three years ended December 31, 2021, to reflect a change in reporting currency from Euro to U.S. dollar, effective Q1 2022 - The company changed its reporting currency from Euro to U.S. dollar (USD), effective from the first quarter of 2022[3](index=3&type=chunk) - This report recasts financial information for the three years ended December 31, 2021, to reflect the new USD reporting currency[3](index=3&type=chunk) - The filing includes Exhibit 99.1 (Financial Results) and Exhibit 99.2 (Operating and Financial Review and Prospects), which are incorporated by reference into other registration statements[5](index=5&type=chunk) [ITEM 5: OPERATING AND FINANCIAL REVIEW AND PROSPECTS](index=5&type=section&id=ITEM%205%3A%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) [Overview](index=5&type=section&id=Overview) Arrival aims to revolutionize the commercial EV market through in-house design, components, and scalable microfactories, targeting underserved van, bus, and car segments - Arrival's mission is to transform the design, assembly, and distribution of commercial EVs using in-house technologies and low-cost, scalable microfactories[12](index=12&type=chunk) - The initial focus is on commercial vans, buses, and cars, targeting a market segment believed to be underserved by other EV manufacturers[13](index=13&type=chunk) - A key agreement with UPS includes an initial order for **10,000 electric vans** with an option for an additional **10,000**, potentially valued at up to **$1.2 billion**[14](index=14&type=chunk) - The company has a joint development agreement with HKMC, expiring in November 2024, to develop vehicles using Arrival's technologies[15](index=15&type=chunk) [Updated Microfactory and Other Cost Estimates](index=6&type=section&id=Updated%20Microfactory%20and%20Other%20Cost%20Estimates) Arrival projects **$75 million** in capital expenditure for its Bicester microfactory through 2022, while facing increased costs from in-house battery assembly and raw material inflation - The Bicester, UK microfactory is expected to have a total capital expenditure of approximately **$75 million** through 2022[16](index=16&type=chunk) - The company is incurring additional costs due to decisions to assemble battery modules in-house, pre-pay for battery cell capacity, and scale its administrative functions[17](index=17&type=chunk) - Arrival is experiencing industry-wide increases in the cost of raw materials such as aluminum and petrochemicals[17](index=17&type=chunk) [Vehicle Volumes and Revenue Expectations for 2022](index=6&type=section&id=Vehicle%20Volumes%20and%20Revenue%20Expectations%20for%202022) Arrival revised its 2022 forecast to **400-600 van sales**, prioritizing vehicle certification, production initiation, and quality as Bicester and Charlotte microfactories begin operations - The company revised its 2022 business plan, now expecting to produce and sell **400 to 600 Arrival Vans**[18](index=18&type=chunk) - Production of the Arrival Van is scheduled to begin in Bicester in Q3 2022 and in Charlotte in Q4 2022[18](index=18&type=chunk) - Priorities for 2022 are completing vehicle certification for the Bus and Van, starting production, and ensuring the highest possible quality[18](index=18&type=chunk) [Key Factors Affecting Operating Results](index=6&type=section&id=Key%20Factors%20Affecting%20Operating%20Results) As a pre-revenue company, Arrival's success hinges on product development, capital raising, commercialization, and regulatory compliance, with progress in prototypes and non-binding orders - The company is pre-revenue and its performance depends on product development, capital raising, commercialization, and regulatory compliance[19](index=19&type=chunk) - Development milestones achieved include building and testing Van prototypes and completing the first two Bus trial milestones[21](index=21&type=chunk) - Arrival is dependent on its ability to raise sufficient capital from third-party sources until it can generate revenue from product sales[23](index=23&type=chunk) - As of March 2, 2022, the company had non-binding orders, letters of intent, or MOUs for approximately **134,000 vehicles**, including the UPS order[25](index=25&type=chunk) [Important Information About Non-IFRS Financial Measures](index=8&type=section&id=Important%20Information%20About%20Non-IFRS%20Financial%20Measures) Arrival uses non-IFRS measures like Adjusted EBITDA, reporting a **$202.9 million** loss in 2021, primarily impacted by a **$1.17 billion** listing expense - The company uses EBITDA and Adjusted EBITDA as non-IFRS measures to help investors evaluate operating results[30](index=30&type=chunk)[31](index=31&type=chunk) Reconciliation of Net Loss to Non-IFRS Measures (in thousands of USD) | | Year ended December 31, 2021 | Year ended December 31, 2020 | | :--- | :--- | :--- | | **(Loss) for the year/period** | **(1,304,381)** | **(95,447)** | | Interest (income)/expense, net | 141 | 2,500 | | Tax (income)/expense | 7,515 | (20,421) | | Depreciation and amortization | 24,337 | 11,071 | | **EBITDA** | **(1,272,388)** | **(102,297)** | | Impairment losses and write-offs | 39,378 | 456 | | Share option expense | 2,668 | 10,697 | | Listing expense | 1,168,515 | — | | Change in fair value of warrants | (122,299) | — | | Fair value movement of embedded derivative | (35,448) | — | | Fair value movement on employee loans | 6,038 | — | | Reversal of difference between fair value and nominal value of loans | (1,906) | — | | Foreign exchange (gain)/loss, net | (2,328) | 663 | | Transaction bonuses | 14,900 | — | | **Adjusted EBITDA** | **(202,870)** | **(90,481)** | [A. Operating Results](index=9&type=section&id=A.%20Operating%20Results) Arrival, a pre-revenue company, reported a **$1.44 billion** operating loss in 2021, primarily due to a **$1.19 billion** non-cash listing expense, alongside significant increases in administrative and R&D expenses Results of Operations (in thousands of USD) | | For the Year Ended December 31, 2021 | For the Year Ended December 31, 2020 | % Changes | | :--- | :--- | :--- | :--- | | Administrative Expenses | (171,030) | (86,178) | 98.5% | | Research and Development Expenses | (57,080) | (20,585) | 177.3% | | Listing expense | (1,188,335) | — | * | | **Operating Loss** | **(1,439,129)** | **(112,364)** | * | | Net Finance Income/(Expense) | 142,263 | (3,504) | (4160.0)% | | **Loss for the Year** | **(1,304,381)** | **(95,447)** | * | - Administrative expenses rose by **$84.9 million (98.5%)** in 2021, driven by increased wages, salaries, and property costs to support expanding operations[48](index=48&type=chunk) - Research and development expenses grew by **$36.5 million (177.3%)** in 2021 due to an expanded engineering headcount and higher program consumable costs[49](index=49&type=chunk) - A one-off listing expense of **$1.188 billion** was recorded in 2021, representing the non-cash cost of the business combination with CIIG[51](index=51&type=chunk) - Net finance income was **$142.2 million** in 2021, compared to a **$3.5 million** expense in 2020, primarily due to a **$122.3 million** positive fair value change in warrants[52](index=52&type=chunk)[54](index=54&type=chunk) [B. Liquidity and Capital Resources](index=14&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) As of December 31, 2021, Arrival held **$900.6 million** in cash, deemed sufficient for 12 months, boosted by **$1.4 billion** in financing activities, with total contractual obligations at **$636.1 million** - As of December 31, 2021, cash and cash equivalents amounted to **$900.6 million**[57](index=57&type=chunk) - Management believes current cash on hand is sufficient to meet working capital and capital expenditure needs for at least the next twelve months[57](index=57&type=chunk) Summary of Cash Flows (in thousands of USD) | | For the Year Ended December 31, 2021 | For the Year Ended December 31, 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | (273,008) | (88,691) | | Net cash used in investing activities | (312,584) | (122,463) | | Net cash generated from financing activities | 1,405,209 | 180,838 | | **Net increase/(decrease) in cash** | **819,617** | **(30,316)** | - In November 2021, Arrival issued **$320.0 million** in green convertible senior notes due 2026, with a **3.50%** annual interest rate, generating net proceeds of **$309.6 million**[72](index=72&type=chunk)[73](index=73&type=chunk) [C. Research and development, patents and licenses, etc.](index=19&type=section&id=C.%20Research%20and%20development%2C%20patents%20and%20licenses%2C%20etc.) Arrival prioritizes R&D and IP protection, with its vertically integrated approach resulting in approximately **50%** proprietary components for the Van and **40%** for the Bus by value - The company invests significant resources in R&D to create a unique value proposition and differentiation from competitors[79](index=79&type=chunk) - Arrival protects its IP through patents, trademarks, designs, and trade secrets[80](index=80&type=chunk) - Due to its vertically integrated approach, approximately **50%** of the Arrival Van's components and **40%** of the Arrival Bus's components (by value) are proprietary[80](index=80&type=chunk) [D. Trend information](index=19&type=section&id=D.%20Trend%20information) Arrival aims to capitalize on EV demand with its microfactory approach, targeting the commercial van, bus, and ride-hailing car markets with competitive pricing and tailored solutions - **Arrival Van:** Aims to produce a light commercial van at a price point between traditional combustion vehicles and other EVs, but with better payload and battery flexibility[84](index=84&type=chunk) - **Arrival Bus:** Targets the **$154 billion** transit bus market, aiming to accelerate the transition to zero-emission public transport with its innovative design[85](index=85&type=chunk) - **Arrival Car:** Being developed in partnership with Uber to address the ride-hailing market, focusing on driver comfort, safety, and durability for high-mileage use[86](index=86&type=chunk) [E. Critical Accounting Estimates](index=20&type=section&id=E.%20Critical%20Accounting%20Estimates) Preparation of IFRS financial statements requires management to make significant estimates and assumptions, impacting reported assets, liabilities, and expenses - The preparation of financial statements requires management to make estimates and assumptions based on historical experience and other factors, which affect reported financial figures[87](index=87&type=chunk) [ITEM 17: FINANCIAL STATEMENTS](index=21&type=section&id=ITEM%2017%3A%20FINANCIAL%20STATEMENTS) [Report of Independent Registered Public Accounting Firm](index=22&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) KPMG LLP issued a clean opinion on Arrival's IFRS financial statements, noting the retrospective currency change and highlighting critical audit matters including development cost capitalization and merger accounting - KPMG LLP issued an opinion that the financial statements are fairly presented in conformity with IFRS[92](index=92&type=chunk) - The auditor highlighted the change in presentation currency from Euro to USD, which was applied retrospectively to all periods presented[93](index=93&type=chunk) - Critical Audit Matters were identified, including: - Capitalisation of development costs - Accounting for the merger with CIIG Merger Corp - Recoverability of employee loans[96](index=96&type=chunk)[99](index=99&type=chunk)[101](index=101&type=chunk) [Consolidated Financial Statements](index=25&type=section&id=Consolidated%20Financial%20Statements) This section presents the consolidated financial statements for 2019-2021, restated in USD, including the Statement of Profit or Loss, Financial Position, Changes in Equity, and Cash Flows Consolidated Statement of Profit or (Loss) (in thousands of USD) | | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | | :--- | :--- | :--- | :--- | | Operating loss | (1,439,129) | (112,364) | (58,033) | | Net finance income/(expense) | 142,263 | (3,504) | (3,565) | | Loss before tax | (1,296,866) | (115,868) | (61,598) | | Tax (expense)/income | (7,515) | 20,421 | 7,757 | | **Loss for the year** | **(1,304,381)** | **(95,447)** | **(53,841)** | Consolidated Statement of Financial Position (in thousands of USD) | | Dec 31, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | **TOTAL ASSETS** | **1,769,765** | **552,058** | | Cash and cash equivalents | 900,606 | 82,314 | | Intangible assets and goodwill | 414,674 | 210,723 | | Property, plant and equipment | 271,607 | 138,317 | | **TOTAL EQUITY AND LIABILITIES** | **1,769,765** | **552,058** | | Total Equity | 1,225,578 | 393,052 | | Total Non-Current Liabilities | 462,601 | 111,245 | | Total Current Liabilities | 81,586 | 47,761 | [Notes to the consolidated financial statements](index=31&type=section&id=Notes%20to%20the%20consolidated%20financial%20statements) These notes detail accounting policies and financial figures, covering basis of preparation, significant policies, segment information, asset/liability details, listing expense, share-based payments, and litigation [Note 2. BASIS OF PREPARATION](index=31&type=section&id=Note%202.%20BASIS%20OF%20PREPARATION) Financial statements are prepared on a going concern basis under IFRS, with a retrospective change in presentation currency from Euro to USD, and management asserts sufficient liquidity for 12 months - The Group changed its reporting currency from Euro to US dollars effective January 1, 2022, and applied this change retrospectively[141](index=141&type=chunk) - The financial statements have been prepared on a going concern basis. Management believes the cash on hand of **$900.6 million** as of Dec 31, 2021, is sufficient to fund the business for at least 12 months[133](index=133&type=chunk)[135](index=135&type=chunk) - Management does not consider the Russia-Ukraine conflict to have a material impact on the Group's activities or cashflows for the purpose of the going concern assessment[140](index=140&type=chunk) [Note 3. SIGNIFICANT ACCOUNTING POLICIES](index=36&type=section&id=Note%203.%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note details critical accounting policies, including capitalization of development costs, fair value measurement of financial instruments, expected credit loss model, and significant management judgments - Development costs are capitalized as intangible assets when they meet specific criteria under IAS 38, including technical feasibility, intent to complete, and ability to generate future economic benefits[171](index=171&type=chunk) - Convertible notes with variable conversion features are treated as hybrid instruments, with the conversion option separated and accounted for as an embedded derivative at fair value through profit or loss[213](index=213&type=chunk) - Management applies significant judgment and estimates in several key areas, including impairment testing, capitalization of development costs, valuation of share-based payments, recoverability of employee loans, and the fair value of warrants and embedded derivatives[220](index=220&type=chunk) [Note 5. OPERATING SEGMENTS](index=59&type=section&id=Note%205.%20OPERATING%20SEGMENTS) Arrival operates as a single 'Automotive' segment, with non-current assets primarily concentrated in the United Kingdom and the United States - The Group is managed and reports as a single operating segment: Automotive[280](index=280&type=chunk) Non-Current Assets by Geography (in thousands of USD, 2021) | | Property, Plant & Equipment | Intangible Assets & Goodwill | | :--- | :--- | :--- | | UK | 202,077 | 414,623 | | US | 47,818 | - | | Spain | 12,453 | - | | Russia | 6,084 | - | | Others | 3,175 | 51 | | **Total** | **271,607** | **414,674** | [Note 7. INTANGIBLE ASSETS AND GOODWILL](index=64&type=section&id=Note%207.%20INTANGIBLE%20ASSETS%20AND%20GOODWILL) Intangible assets and goodwill increased to **$414.7 million** in 2021, primarily from capitalized development costs, with a **$17.6 million** impairment charge for non-core projects Intangible Assets and Goodwill (in thousands of USD) | | Goodwill | Assets under construction | Patent, trademarks, etc. | Software | TOTAL | | :--- | :--- | :--- | :--- | :--- | :--- | | **Net book Value at Jan 1, 2021** | **33** | **207,142** | **471** | **3,077** | **210,723** | | Additions | — | 225,885 | — | 6,103 | 231,988 | | Impairments | — | (17,243) | (325) | — | (17,568) | | **Net book Value at Dec 31, 2021** | **30** | **408,193** | **74** | **6,377** | **414,674** | - Assets under construction primarily relate to development projects for electric vehicles, components, and software[300](index=300&type=chunk) - An impairment loss of **$16.1 million** was recorded for assets under development related to the Charging Stations and Roborace cash-generating units, which are no longer considered core projects[301](index=301&type=chunk) [Note 15. LOANS AND BORROWINGS](index=80&type=section&id=Note%2015.%20LOANS%20AND%20BORROWINGS) Loans and borrowings increased significantly in 2021 to **$451.5 million** non-current, driven by **$320 million** in convertible notes and increased lease liabilities Loans and Borrowings Breakdown (in thousands of USD, Dec 31, 2021) | | Non-current | Current | | :--- | :--- | :--- | | Lease liabilities | 173,904 | 13,076 | | Convertible notes | 159,021 | 1,182 (interest) | | Embedded derivatives | 118,600 | — | | **Total** | **451,525** | **14,258** | - In November 2021, Arrival issued **$320 million** in convertible notes due 2026 with a **3.5%** interest rate[384](index=384&type=chunk)[385](index=385&type=chunk) - The conversion feature of the notes is accounted for as a separate derivative liability because it could require a variable number of shares to be issued upon conversion. It was initially valued at **$152.5 million**[384](index=384&type=chunk)[386](index=386&type=chunk) [Note 16. WARRANTS](index=87&type=section&id=Note%2016.%20WARRANTS) Arrival issued public and private warrants during its business combination, with most exercised or redeemed by year-end 2021, leaving **2.4 million** private warrants outstanding - As part of the merger, Arrival issued **7,175,000 private warrants** and **12,937,493 public warrants** with a total initial fair value of **$208.6 million**[396](index=396&type=chunk) - On June 18, 2021, Arrival announced the redemption of all outstanding public warrants for cash at an exercise price of **$11.50 per share**[398](index=398&type=chunk) Warrant Movement During 2021 (in thousands) | | Number of Warrants | Value (USD) | | :--- | :--- | :--- | | Warrants issued by Arrival | 20,112 | 208,586 | | Change in fair value | — | (122,299) | | Warrants exercised | (17,009) | (82,669) | | Warrants redeemed | (712) | (7) | | **Total Outstanding at Dec 31, 2021** | **2,392** | **3,611** | [Note 22. LISTING EXPENSE](index=97&type=section&id=Note%2022.%20LISTING%20EXPENSE) The business combination was accounted for as a reverse merger, resulting in a significant non-cash listing expense of **$1.17 billion** under IFRS 2 - The transaction was accounted for as a reverse merger, which resulted in a non-cash listing expense recognized in the statement of profit or loss[433](index=433&type=chunk)[434](index=434&type=chunk) Listing Expense Calculation (in thousands of USD) | | Amount | | :--- | :--- | | Fair value of shares issued | 1,591,090 | | Fair Value of Warrants transferred | 208,586 | | **Total value of consideration** | **1,799,676** | | Less: Fair Value of net asset received | (631,161) | | **Reverse merger impact (IFRS 2)** | **1,168,515** | | Other expenses directly linked | 19,820 | | **Total listing expense** | **1,188,335** | [Note 23. SHARE BASED PAYMENTS](index=97&type=section&id=Note%2023.%20SHARE%20BASED%20PAYMENTS) Arrival operates multiple equity incentive plans, including SOP, RSP, and RSUs, with a **$4.7 million** SOP expense in 2021 and a strike price currency change to USD - The company has multiple share-based payment plans: Share Option Plan (SOP), Restricted Share Plan (RSP), and Restricted Stock Units (RSU)[438](index=438&type=chunk)[440](index=440&type=chunk)[458](index=458&type=chunk) - The total SOP charge for 2021 was **$4.7 million**, with part of the cost capitalized and part expensed[442](index=442&type=chunk) - In August 2021, the SOP was modified to change the strike price currency from EUR to USD, setting the new strike price at **$7.19**[442](index=442&type=chunk)[453](index=453&type=chunk) - In 2021, **50,000 new RSUs** were issued to Non-Executive Directors with a grant date fair value of **$707,577**[458](index=458&type=chunk) [Note 26. CLAIMS AND LITIGATIONS](index=104&type=section&id=Note%2026.%20CLAIMS%20AND%20LITIGATIONS) Arrival faces multiple shareholder class action lawsuits alleging false or misleading statements regarding operations and financial performance, which the company intends to vigorously defend - The company is a defendant in several putative class action lawsuits filed by shareholders[471](index=471&type=chunk)[472](index=472&type=chunk)[473](index=473&type=chunk) - Allegations generally concern false or misleading statements about the company's operations, financial performance, and growth prospects[471](index=471&type=chunk)[473](index=473&type=chunk) - Arrival intends to vigorously defend against the ongoing legal actions[475](index=475&type=chunk) [Note 28. SUBSEQUENT EVENTS](index=105&type=section&id=Note%2028.%20SUBSEQUENT%20EVENTS) Key subsequent events include the Russia-Ukraine conflict's non-material impact on operations and the grant of **3.5 million** new RSUs in January 2022 - Regarding the Russia-Ukraine conflict, Arrival has relocated employees and data from Russia and does not expect a material adverse impact on its business or financial condition[477](index=477&type=chunk) - On January 24, 2022, Arrival granted **3,495,662 Restricted Stock Units (RSUs)** to employees and other eligible participants[478](index=478&type=chunk)

Financial Data and Key Metrics Changes - The loss for Q2 2022 was $90 million, compared to a loss of $56 million in Q2 2021, indicating a significant increase in losses year-over-year [13] - Adjusted EBITDA loss for the quarter was $76 million, up from a loss of $41 million in the same quarter last year [13] - Capital expenditures in Q2 2022 were $95 million, compared to $79 million in Q2 2021, with $60 million allocated to capitalized R&D and $35 million for microfactory CapEx and tooling [14] Business Line Data and Key Metrics Changes - The company achieved European certification for its bus and van, marking a major milestone [5] - The focus has shifted to the Van platform, which constitutes the majority of MOU and order volumes, leading to a deferral of further investment in the bus program [7] - Nonbinding MOUs and orders grew to 149,000 units, representing over $6 billion in potential revenue [12] Market Data and Key Metrics Changes - The company is experiencing strong demand for its vehicles, particularly in the North American market, supported by favorable policies from the Inflation Reduction Act [11] - The company plans to start trials in Central London and expects the first deliveries of Vans to UPS before the end of the year [9] Company Strategy and Development Direction - The company has made a strategic decision to downscale operations through at least 2023, focusing on cash preservation and a targeted 20% reduction in spending [6] - A $300 million at-the-market equity offering platform has been established to extend the cash runway [7] - The company aims to produce multiple vehicle platforms in hundreds of microfactories, each generating over $100 million in annualized margin [19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging economic environment, including supply chain issues and rising costs, and emphasized the importance of addressing these challenges [5] - The company expects to operate through at least 2023 without needing to raise additional capital, aside from the ATM [15] - Management expressed confidence in achieving production targets and maintaining a strong demand pipeline despite current challenges [12][24] Other Important Information - The company is undergoing a restructuring that includes a targeted 30% reduction in its global workforce [14] - The transition to a single product, single factory, and single shift model is seen as a strategic move to enhance operational efficiency [29] Q&A Session Summary Question: What caused the reduction in delivery expectations from 400-600 to 20? - Management cited the decision to operate one factory instead of two to save cash, supply chain delays, and a conservative approach to cash spending as reasons for the reduction [21][22] Question: When is production expected to start in Charlotte? - Internal plans suggest that production in Charlotte will be quicker due to learnings from the Bicester factory, but no specific timeline was provided [26][27] Question: What is the expected ending cash balance at the end of Q3? - The company expects to end Q4 with between $300 million and $350 million in cash, with Q3 cash burn anticipated to be higher than in Q4 [33] Question: Are there expected cash restructuring costs in Q3 or Q4? - Restructuring costs are expected to be approximately $25 million, primarily occurring in Q3 [37] Question: Has the pricing philosophy changed due to rising costs? - The pricing philosophy remains unchanged, aiming to be competitively positioned between ICE vehicles and electric vehicles, despite rising inflation and supply chain issues [41]