Lordstown Motors has filed for bankruptcy, alleging that Taiwanese investor Foxconn’s engaged in fraudulent conduct and failed to meet agreements, Reuters reports.
The company filed for bankruptcy protection this Tuesday at a Delaware court. According to court filings, Lordstown has claimed that Foxconn did not hold up its share of an agreement to invest $170 million into the automaker.
Foxconn, also known as Hon Hai Precision Industry, had invested around $52.7 million into Lordstown and holds an 8.4% stake in the company. Lordstown claimed that it has refused to purchase additional stocks even as the EV-maker’s stocks fell below $1 per share and that this is a violation of the agreements previously made between the two companies.
As of now, Foxconn has ended negotiations with Lordstown and could possibly pursue legal action against them following accusations of failing to meet commitments to funding and not following through with supporting projects that Foxconn originally pushed for.
