Lordstown warns that without the Foxconn agreement it will be "deprived of critical funding necessary for its operations."
Lordstown Motors Corp. stock tanked over 30% Monday after the EV maker said in a filing that Taiwanese electronics contract maker Foxconn wants to put the brakes on their deal, and warned that without the agreement it will be “deprived of critical funding necessary for its operations.”
Foxconn’s deal staved off a going-concern warning that Lordstown issued in June 2021, shortly before the auto maker saw its then Chief Executive Steve Burns and Chief Financial Officer Julio Rodriguez resign and investors sued the company. Foxconn then bought about $22.7 million in common stock and $30 million in preferred stock. According to the deal, Foxconn was required to buy additional batches of common stock, worth about $47.3 million and $70 million, within a timeline that included the regulatory approvals and the EV milestones.
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