XOS and Aljomaih limit share issuance to 19.99% under convertible note

Rhea-AI Filing Summary

Xos, Inc. and Aljomaih amended terms of a convertible note to limit share-based interest and conversion dilution. The parties agreed a cap of 1,737,247 common shares (about 19.99% of outstanding stock as of August 8, 2025) that may be delivered as interest shares or issued on conversion, subject to adjustment.

If interest or conversion obligations would exceed that cap, excess interest will be paid in cash within five business days after the earlier of August 11, 2026 or the date shareholder approval is obtained to exceed the cap. The amendment clarifies conversion/interest-share mechanics and limits share issuance in the near term.

Positive

• Cap on dilution: The amendment limits total Interest Shares and conversion-related issuances to 1,737,247 shares (19.99%), reducing immediate dilution risk.
• Cash alternative: Any interest amounts exceeding the cap must be paid in cash by the earlier of August 11, 2026 or shareholder approval to exceed the cap, preventing automatic share issuance beyond the Limit.
• Transparency and mechanics clarified: The Letter clarifies how Interest Shares and conversion issuances are treated, improving predictability for shareholders and modelers.

Negative

• None.

Insights

Financial Analyst

TL;DR: Amendment caps share-based dilution from the convertible note at 19.99%, creating a near-term limit on equity issuance tied to interest and conversion.

The Letter formalizes a quantitative ceiling of 1,737,247 shares for Interest Shares and conversion-related issuance, which constrains dilution that could arise from the Convertible Note. By requiring cash payment for any interest beyond the cap until either shareholder approval or August 11, 2026, the company preserves flexibility to avoid immediate excessive share issuance but assumes additional near-term cash obligations if the cap is reached. For financial modeling, treat potential dilution as limited to the stated cap pending any shareholder vote or adjustment.

Corporate Governance Expert

TL;DR: The amendment protects existing shareholders by imposing a clear limit on equity issuance tied to the note and specifying alternative cash payments.

The agreement sets an explicit, adjustable Limit equal to approximately 19.99% of outstanding common stock as of August 8, 2025, and clarifies issuance mechanics for Interest Shares. This provides transparency on potential dilution and ties any increase above the Limit to a shareholder approval process or a deferred cash-payment timeline. From a governance perspective, codifying shareholder approval as a condition to exceed the cap strengthens shareholder control over dilution decisions.

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 14, 2025

XOS, INC.

(Exact name of registrant as specified in its charter)

Delaware

001-39598

98-1550505

(State or Other Jurisdiction of Incorporation)

(Commission File Number)

(I.R.S. Employer Identification No.)

3550 Tyburn Street Los Angeles, California						90065
(Address of principal executive offices)						(Zip Code)

(818) 316-1890
(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240-13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

XOS

Nasdaq Capital Market

Warrants, every thirty warrants exercisable for one share of Common Stock at an exercise price of $345.00 per share

XOSWW

Nasdaq Capital Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01. Entry into a Material Definitive Agreement.

As previously disclosed, on August 8, 2025, Xos, Inc. (the "Company") and Aljomaih Automotive Co. ("Aljomaih") entered into Amendment No. 1 to Note Purchase Agreement (the "NPA Amendment") and a Second Amended and Restated Convertible Promissory Note (the "Convertible Note" and, together with the NPA Amendment, the “Aljomaih Amendments”).

On August 14, 2025, the Company and Aljomaih executed a letter agreement (the "Letter"), effective as of the date of the Aljomaih Amendments, which clarified certain provisions in the Convertible Note and imposed limitations on the issuance of shares of common stock, par value $0.0001 per share of the Company ("Common Stock") in payment of interest amounts on the Convertible Note ("Interest Shares"), including the payment of interest scheduled for August 25, 2025, under certain circumstances. The Letter provides that, under certain circumstances, the aggregate number of Interest Shares deliverable or previously delivered upon any interest payments under the Convertible Note plus the number of shares of Common Stock that may be issued or were previously issued in respect of conversion of principal or any other portion of the Convertible Note, shall not exceed 1,737,247 shares of the Company’s Common Stock (subject to adjustment) (the "Limit"), which was 19.99% of the outstanding shares of the Company's Common Stock on August 8, 2025, immediately prior to the Aljomaih Amendments. Any interest amounts payable in excess of the amount payable with Interest Shares, shall instead be payable within five business days of the earlier of (x) August 11, 2026 and (y) the date the Company receives stockholder approval to issue more than the Limit in respect of conversion of the Convertible Note, as amended.

The foregoing description of the Letter is qualified in its entirety by reference to the actual Letter, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference to this Item 1.01.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.						Description
10.1						Letter Agreement between Xos, Inc. and Aljomaih Automotive Co., executed on August 14, 2025
104						iXBRL language is updated in the Exhibit Index

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 hereunto duly authorized.

Dated: August 14, 2025

			XOS, INC.
			By:			/s/ Liana Pogosyan
						Liana Pogosyan
						Chief Financial Officer

FAQ

What limit does the XOS and Aljomaih amendment place on share issuance?

The Letter caps Interest Shares plus shares issuable on conversion at 1,737,247 shares, approximately 19.99% of outstanding common stock as of August 8, 2025.

What happens if interest or conversion obligations exceed the 1,737,247-share cap?

Any interest amounts in excess of the cap will be payable in cash within five business days of the earlier of August 11, 2026 or the date shareholder approval is obtained to issue shares above the cap.

Does the amendment change conversion mechanics for the Convertible Note?

The Letter clarifies certain provisions of the Convertible Note and imposes the stated Limit on issuance of Interest Shares and conversion-related shares; the actual conversion mechanics are described in the Letter filed as Exhibit 10.1.

Is shareholder approval required to exceed the cap?

Yes. The company must obtain shareholder approval to issue more than the Limit in respect of conversion of the Convertible Note; otherwise excess interest is payable in cash as specified.

When does the cash-payment alternative deadline occur if the cap is exceeded?

Cash payment is due within five business days of the earlier of August 11, 2026 or the date the company receives shareholder approval to exceed the Limit.