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UPDATE 1-Lordstown's funding in crisis as investor Foxconn alleges agreement breach

Reuters
Updated ·1 min read

(Add details, background)

May 1 (Reuters) - Major shareholder Foxconn is alleging that Lordstown Motors had breached their $170 million investment deal, the EV maker said on Monday, while warning that it might not have enough cash to fund its operations if the agreement falls through.

Lordstown, whose shares tumbled 15% in early trading, said Foxconn pointed to the delisting notice that the company received from the Nasdaq in a letter alleging the breach.

The U.S. company rejected the allegation and said it was in talks with the Taiwanese contract manufacturer to seek a resolution.

Foxconn did not immediately respond to a request for comment.

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Foxconn had in November struck a deal to take a near-20% stake in loss-making U.S. electric truck maker Lordstown Motors for up to $170 million.

(Reporting by Tiyashi Datta in Bengaluru; Editing by Anil D'Silva)