NU Ride Inc (NRDE)

[Saving Grace]

Yesterday, LMC announced that Foxconn has agreed to make additional equity investments in LMC (collectively, the “Investment Transactions”) of up to $170 million in the form of $70 million of LMC’s Class A common stock and up to $100 million of a newly created Series A Convertible Preferred Stock (“Preferred Stock”). Upon completion of the Investment Transactions, Foxconn is expected to hold all of LMC’s outstanding Preferred Stock and 18.3% of its Common Stock on a pro forma basis, and will have the right to designate two members of LMC’s Board of Directors.

Lordstown Motors will use the proceeds from the sale of Common Stock for general corporate purposes and the proceeds from the sale of the Preferred Stock to fund development and design activities for a new electric vehicle program in collaboration with Foxconn (the “EV Program”). The $100 million direct Preferred Stock Investment replaces the joint venture funding previously announced by Foxconn and LMC.

Foxconn’s Common Stock investment will be funded in two tranches. The first tranche of approximately $22.7 million is expected to close on or about November 22, 2022, subject to customary closing conditions. The second tranche of approximately $47.3 million is subject to regulatory approvals, including clearance by the Committee on Foreign Investment in the United States (“CFIUS”), as well as other customary closing conditions.

Foxconn’s Preferred Stock investment will be funded in three phases. The first $30 million will be funded, subject to satisfaction of certain closing conditions, simultaneously with the closing of the first tranche of Common Stock. The remaining shares of Preferred Stock will be purchased by Foxconn based on achieving certain EV Program funding milestones to be agreed-upon by the parties.

Foxconn’s additional investment in LMC is a strong sign of confidence in our team’s product development and engineering capabilities and will help accelerate the EV ambitions of both companies. We continue to believe that deep collaboration with Foxconn, as its preferred North American vehicle development partner, and Foxconn’s EV ecosystem, including MIH, is key to our company’s long-term success.

https://ih.advfn.com/stock-market/NASDAQ/lordstown-motors-RIDE/stock-news/89492922/lordstown-motors-reports-third-quarter-2022-financ