Cenntro Shareholders Vote in Favor of Proposed Scheme to Redomicile from Australia to the United States

Rhea-AI Summary

Cenntro Electric Group Limited (NASDAQ: CENN) announced that shareholders have voted in favor of the proposed redomiciliation from Australia to the United States. The Scheme remains subject to the approval of the Court at the hearing scheduled for February 14, 2024. If approved, the Scheme will be implemented on February 27, 2024.

Insights

Market Research Analyst

The redomiciliation of Cenntro Electric Group Limited from Australia to the United States represents a strategic move that could have implications for the company's operational efficiency, tax obligations and access to capital markets. The overwhelming shareholder support indicates a positive outlook on this transition, with 97.5% of votes cast in favor. This move may streamline corporate structure and potentially reduce administrative and regulatory complexities associated with operating across international borders.

From a market standpoint, the redomiciliation could enhance Cenntro's visibility among U.S. investors and analysts, possibly leading to increased trading liquidity and a broader shareholder base. The relocation to Nevada, a state known for its business-friendly environment and no state corporate income tax, may offer financial benefits that could improve the company's bottom line over time. However, it's important to monitor how the transition will be managed to prevent any short-term disruptions to operations or investor relations.

Financial Analyst

The financial implications of Cenntro's redomiciliation are multifaceted. In the short term, there could be costs associated with the transition, including legal, administrative and regulatory expenses. However, these must be weighed against the potential long-term financial benefits, such as improved access to the U.S. capital markets, which could facilitate easier fundraising and expansion opportunities.

Investors should also consider the impact on the company's valuation. If the move is perceived as a step towards greater transparency and governance standards, it could lead to a re-rating of the stock. Additionally, being closer to key markets and suppliers could result in operational cost savings and improved logistics, contributing to margin expansion. The timing of the transition, set for late February 2024, will require careful attention to ensure it aligns with the company's financial reporting and does not introduce uncertainty during a critical period.

Legal Expert

The legal process of redomiciliation involves a scheme of arrangement, which is subject to court approval. The successful vote by Cenntro's shareholders is a crucial step, but the final legal hurdle will be the approval by the Supreme Court of New South Wales. This legal endorsement is necessary to ensure the transition adheres to both Australian and U.S. corporate laws.

Once the court's approval is obtained, the implementation of the scheme will involve intricate legal procedures, such as filing with the Australian Securities and Investments Commission (ASIC) and issuing HoldCo shares to existing shareholders. The legal intricacies of this process are significant because they ensure the protection of shareholder rights and the continuity of the company's obligations. It is also indicative of a well-structured corporate governance framework, which can be reassuring to investors and stakeholders alike.

FREEHOLD, N.J.--(BUSINESS WIRE)-- Cenntro Electric Group Limited (NASDAQ: CENN) (“Cenntro”, or the “Company”), a leading electric vehicle technology company with advanced, market-validated electric commercial vehicles, today announced that Cenntro shareholders have voted in favor of the proposed scheme of arrangement in which Cenntro will redomicile from Australia to the United States (“Scheme”), and under which Cenntro will become a wholly owned subsidiary of Cenntro Inc. (“HoldCo”), a United States ("U.S.”) company incorporated in accordance with the laws of the State of Nevada for the purpose of effecting the Cenntro's redomiciliation to the U.S.

All times and dates set forth in this press release refer to the time and date in Australian Eastern Daylight Time, unless specified otherwise.

Results of Scheme Meeting

Cenntro is pleased to report the resolution to approve the Scheme ("Scheme Resolution"), as set out in the Notice of Meeting included within the scheme booklet that is contained within the Definitive Proxy Statement on Schedule 14A filed with the United States Securities and Exchange (“SEC”) on December 15, 2023 (the “Scheme Booklet”), was passed by the requisite majorities of Cenntro shareholders present at the scheme meeting held on Wednesday, January 24, 2024 (United States Eastern Standard Time) ("Scheme Meeting") pursuant to orders made by the Supreme Court of New South Wales, Australia ("Court").

In summary:

• 71.16% of Cenntro shareholders present and voting (in person or by proxy, attorney or corporate representative) voted in favor of the Scheme Resolution; and
• 97.51% of the votes cast by Cenntro shareholders were in favor of the Scheme Resolution.

Details of the valid proxies received and votes cast at the Scheme Meeting are set out below.

Vote direction	Number of votes cast	% of votes cast	Number of Cenntro shareholders voting
IN FAVOR	11,205,948	97.5%	2,707
AGAINST	245,023	2.13%	821
ABSTAIN	41,266	0.36%	276
TOTAL	11,492,237	100%	3,804

Undefined terms in this press release have the meanings given to them in the Scheme Booklet.

Next Steps

The Scheme remains subject to the approval of the Court at the hearing scheduled for 9:15am on Wednesday, February 14, 2024, and certain other customary conditions precedent as previously announced and described in the Scheme Booklet. If the outstanding Conditions Precedent as set forth in the Scheme Booklet are satisfied or waived (if applicable) prior to the hearing, and the Court approves the Scheme, Cenntro proposes to file an office copy of the orders of the Court with the Australian Securities and Investments Commission ("ASIC") (expected to occur on the next business day, Thursday, February 15, 2024), at which time the Scheme will become effective. The Scheme will then be implemented on Tuesday, February 27, 2024.

Key Dates

The key dates for implementation of the Scheme are set out below:

Expected date*	Event
Wednesday, February 14, 2024 at 9:15am	Second Court Hearing to obtain orders approving the Scheme
Thursday, February 15, 2024	Filing by Cenntro with ASIC of the Court orders approving the Scheme
Thursday, February 22, 2024 at 7:00pm	Record Date
Tuesday, February 27, 2024	Implementation Date
Thursday, February 29, 2024	Commencement of dispatch to Scheme Shareholders of statements confirming the issue of HoldCo Shares

*All dates and times listed in the table above are in Australian Eastern Daylight Time and are indicative only and subject to change. Cenntro, in consultation with HoldCo, may vary any or all of these dates and times and will provide reasonable notice of any such variation. Certain times and dates are conditional on the conditions precedent to the Scheme, including approval of the Scheme by the Court, being satisfied or waived (as applicable). Any changes will be announced by Cenntro to Nasdaq and published on Cenntro’s website at www.cenntroauto.com.

About Cenntro Electric Group Ltd.

Cenntro Electric Group Ltd. (NASDAQ: CENN) is a leading maker and provider of electric commercial vehicles (“ECVs”). Cenntro's purpose-built ECVs are designed to serve a variety of commercial applications inclusive of its line of class 1 to class 4 trucks. Cenntro is building a globalized supply-chain, as well as the manufacturing, distribution, and service capabilities for its innovative and reliable products. Cenntro continues to evolve its products capabilities through advanced battery, powertrain, and smart driving technologies. For more information, please visit Cenntro's website at: www.cenntroauto.com.

Forward-Looking Statements

This communication contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts. Such statements may be, but need not be, identified by words such as "may,'' "believe,'' "anticipate,'' "could,'' "should,'' "intend,'' "plan,'' "will,'' "aim(s),'' "can,'' "would,'' "expect(s),'' "estimate(s),''"project(s),'' "forecast(s)'', "positioned,'' "approximately,'' "potential,'' "goal,'' "strategy,'' "outlook'' and similar expressions. Examples of forward-looking statements include, among other things, statements regarding assembly and distribution capabilities, decentralized production, and fully digitalized autonomous driving solutions. All such forward-looking statements are based on management's current beliefs, expectations and assumptions, and are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed or implied in this communication. For additional risks and uncertainties that could impact Cenntro’s forward-looking statements, please see disclosures contained in Cenntro's public filings with the SEC, including the "Risk Factors" in Cenntro's Annual Report on Form 10K/A filed with the Securities and Exchange Commission on July 6, 2023 and which may be viewed at www.sec.gov.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240205829196/en/

Investor Relations Contact:

Chris Tyson

MZ North America

CENN@mzgroup.us

949-491-8235

Company Contact:

PR@cenntroauto.com

IR@cenntroauto.com

Source: Cenntro Electric Group Limited

FAQ

What is the ticker symbol for Cenntro Electric Group Limited?

The ticker symbol for Cenntro Electric Group Limited is CENN.

What was the percentage of Cenntro shareholders that voted in favor of the Scheme Resolution?

71.16% of Cenntro shareholders present and voting voted in favor of the Scheme Resolution.

When is the Second Court Hearing to obtain orders approving the Scheme?

The Second Court Hearing to obtain orders approving the Scheme is scheduled for February 14, 2024 at 9:15am.

When will the Scheme be implemented?

If approved, the Scheme will be implemented on February 27, 2024.