Xos SPAC Presentation Deck

RISK FACTORS The list below of risk factors has been prepared solely for purposes of the proposed private placement transaction (the "Private Placement") as part of the proposed business combination of NextGen Acquisition Corporation ("NextGen") and Xos, Inc. (the "Business Combination"), and solely for potential investors in the Private Placement, and not for any other purpose. All references to "Xos," the "Company," "we," "us" or "our" refer to the business of Xos, Inc. and its consolidated subsidiaries. The risks presented below are certain of the general risks related to the business of the Company, the Private Placement and the Business Combination, and such list is not exhaustive. The list below is qualified in its entirety by disclosures contained in future documents filed or furnished by the Company and NextGen, with the U.S. Securities and Exchange Commission ("SEC"), including the documents filed or furnished in connection with the proposed transactions between the Company and NextGen. The risks presented in such filings will be consistent with those that would be required for a public company in its SEC filings, including with respect to the business and securities of the Company and NextGen and the proposed transactions between the Company and NextGen, and may differ significantly from and be more extensive than those presented below. Investing in securities (the "Securities") to be issued in connection with the Business Combination involves a high degree of risk. You should carefully consider these risks and unce es, togeth with the information in the Company's consolidated financial statements and related notes, and should carry out your own due diligence and consult with your own financial and legal advisors concerning the risks and suitability of an investment in the Private Placement, before making an investment decision. There are many risks that could affect the business and results of operations of the Company, many of which are beyond its control. If any of these risks or uncertainties occurs, the Company's business, financial condition and/or operating results could be materially and adversely harmed. Additional risks and uncertainties not currently known or those currently viewed to be immaterial may also materially and adversely affect the Company's business, financial condition and/or operating results. If any of these risks or uncertainties actually occurs, the value of the Company's equity securities may decline, and any investor in the Offering may lose all or part of its investment. Risks Related to our Business and our Industry Capital Requirements and Cost Fluctuations. We require significant capital to develop and grow our business, including with respect to the design, development, marketing, distribution and sale of our goods and services. Increased costs associated with the operation of our business, the disruption of our supply chain or a shortage of materials (including, without limitation, a change in the price or availability of lithium-ion battery cells and their component parts) could harm our business. Our financial results may be significantly and negatively impacted from period to period due to the aforementioned fluctuations in operating costs and other factors. ● ● Financial Condition and Potential Dilution. We are an early stage company with a history of losses. We could incur significant expenses and continued losses for the foreseeable future. We have yet to achieve positive operating cash flow and our ability to generate positive cash flow is uncertain. We may encounter unforeseen expenses, difficulties, complications, delays and other unknown events which may result in our inability to achieve or maintain profitability. In addition, our operational and financial results forecasts rely in large part upon assumptions and analyses developed by us. If these assumptions or analyses prove to be incorrect, in whole or in part, our actual operational and financial results may be materially different from forecasted results. Our future capital needs may require us to sell additional equity or debt securities that may dilute our stockholders or introduce covenants that may restrict our operations or our ability to pay dividends. ● Limited Operational History and Competitive Landscape. Our limited operating history makes evaluating our business and future prospects difficult and may increase the risk of your investment. Our ability to develop and manufacture EVS and their component parts of sufficient quality and appeal to customers on schedule and on a large scale is still unproven and continues to evolve. Our limited operational history may hinder our ability to anticipate and timely adapt to increases or decreases in revenues or experiences significant and unanticipated delays in the design, production and launch of our goods and services. Our business, prospects, financial condition and operating results could experience significant harm as a result. We also face a competitive market with respect to our goods and services and may therefore not be successful in competing within the industry. There may also be significant developments in alternative technologies, such as advanced diesel, ethanol, or compressed natural gas or improvements in the fuel economy of the internal combustion engine, which may materially and adversely affect our business and prospects in ways we do not currently anticipate. ● Business Development and Partnerships. Certain of our strategic, development and deployment arrangements or expected arrangements could be terminated or may not materialize into contract partnership arrangements on a long-term basis or at all. We may also not be able to successfully engage target customers or convert early trial deployments with truck fleets into meaningful orders or additional deployments in the future. If we fail to manage or develop our partnerships and customer growth effectively, including failing to attract and integrate qualified personnel, we may not be able to design, develop, manufacture, market and launch our EVs and related products successfully. ● ● Suppliers. We rely on suppliers, some of which are limited source suppliers, for necessary components of our vehicles and outsourced partners for the manufacturing of our vehicles and component parts. A loss of any of these partners or defects in or failure of the products that they supply to us could negatively affect our business. ● Insurance. We maintain certain levels of insurance; we may, however, face claims from time-to-time that could exceed our insurance coverage or not fall within our coverage. Forecasts. Our operating and financial result forecasts rely in large part upon assumptions and analyses developed by us. If these assumptions and analyses prove to be incorrect, our actual operating results may differ materially. Risks Related to the Private Placement ● Capital Raise. There can be no assurance that NextGen will be able to raise sufficient capital in the Private Placement to consummate the Business Combination or for use by the combined company following the Business Combination (the "Combined Company"). Voting Power. The issuance of shares of the Combined Company's securities in connection with the Private Placement will dilute substantially the voting power of Combined Company's shareholders. Confidential and Privileged, Property of Xos, Inc. 44