Tuesday, June 27, 2023 6:50:22 AM
June 27, 2023
https://investor.lordstownmotors.com/node/9261/html
Item 1.03 Bankruptcy or Receivership.
Chapter 11 Filing
On June 27, 2023, Lordstown Motors Corp., a Delaware corporation (the “Company”), and its subsidiaries (collectively, the “Company Parties”) announced a strategic restructuring process to maximize the value of their assets, which include the on-the-road Endurance electric vehicle (EV) pickup truck (the “Endurance”) and the intellectual property, platform and people that developed it.
The process consists of two key steps. First, on June 27, 2023, the Company Parties filed litigation (the “Foxconn Litigation”) against Hon Hai Precision Industry Co., Ltd (a/k/a Hon Hai Technology Group), Foxconn EV Technology, Inc., Foxconn Ventures Pte. Ltd., Foxconn (Far East) Limited, and Foxconn EV System LLC (collectively, “Foxconn”) in the U.S. Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Foxconn Litigation, which is further described under Item 8.01 below, details Foxconn’s fraud, bad faith and willful and consistent failure to live up to its commercial and financial commitments to the Company Parties. Foxconn’s actions led to material damage to the Company Parties as well as their future prospects.
Second, and as a direct consequence of the material and irreparable harm caused by Foxconn, the Company Parties are pursuing a restructuring through a voluntary petition also filed on June 27, 2023 under chapter 11 (“Chapter 11”) of the U.S. Bankruptcy Code (the “Bankruptcy Code”) in the Bankruptcy Court. On such date, the Company Parties filed a motion with the Bankruptcy Court seeking to jointly administer the proceedings under the caption “In re: Lordstown Motors Corp., et al.” (the “Chapter 11 Cases”). The Company further anticipates that the restructuring will enable an expedited timeline for hearing the Foxconn Litigation.
As part of the restructuring, the Company Parties are commencing and pursuing a comprehensive marketing and sale process for the Endurance and related assets to maximize the value of those assets. The Company provides no assurance that it will successfully complete any such dispositions or the pricing and other terms of any such transactions. The Company also intends to use the tools of Chapter 11 to fully, finally, and efficiently resolve its contingent and other liabilities and to pursue the Foxconn Litigation before the Bankruptcy Court.
The Company Parties continue to operate their business as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court; however, development activities with respect to future vehicles have ceased and production of the Endurance will cease in the near term. To minimize the effect of the Chapter 11 Cases on the Company Parties’ customers, suppliers, vendors, and employees, the Company Parties have filed various “first-day” motions with the Bankruptcy Court requesting customary relief, including authority to pay employee wages and benefits, employ bankruptcy professionals, continue to employ ordinary course professionals, maintain their insurance and utility services and to pay vendors and suppliers for goods and services provided both before and after the filing date. The Company enters Chapter 11 with significant cash on hand and is debt-free.
Recent NRDE News
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 05/16/2024 12:28:04 AM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 05/14/2024 08:48:59 PM
Kona Gold Beverages, Inc. Announces Strategic Initiatives and Corporate Direction Changes • KGKG • Aug 2, 2024 2:00 PM
POET and Luxshare Tech Expand Product Offerings for Artificial Intelligence Networks • POET • Aug 1, 2024 9:28 AM
Management Discusses Financial Filings of Global Arena Holding Inc., for 10-K 2023 and 10-Q, 1st Quarter 2024 • GAHC • Aug 1, 2024 9:14 AM
VAYK Announces LOI to Acquire $1 Million Home Service Company to Support Airbnb Business • VAYK • Aug 1, 2024 9:00 AM
Duane Forrester Joins INDEXR as SVP of Search • MONI • Jul 31, 2024 11:46 AM
Lingerie Fighting Championships Help Fulfill Death-Bed Promise With First Major Motion Picture • BOTY • Jul 31, 2024 9:00 AM