LMC discloses no firm orders; announces global VP
LORDSTOWN — Lordstown Motors Corp. in a regulatory filing Thursday disclosed it does not have any sort of firm purchase commitment for the battery-powered truck the startup expects to launch in September.
It’s a reversal from statements earlier this week by company President Rich Schmidt, who during an online automotive event said Lordstown Motors has “firm” and “binding” orders for the first two years of production, according to Reuters.
The latest information was contained in a filing with the U.S. Securities and Exchange Commission that also presented details of the the company’s sales and marketing strategy involving fleet management companies.
Vehicle purchase agreements with those companies “do not represent binding purchase orders or other firm purchase commitments,” the filing states, seeking to clarify Schmidt’s remarks Tuesday during the Automotive Press Association event.
“As previously disclosed … we have engaged in limited marketing activities and we have no binding purchase orders or commitments from customers,” the filing states.
The electric truck startup stated despite the nonbinding nature of the agreements, “we believe that they provide us with a significant indicator for demand for the Endurance.”
Lordstown Motors stock fell 4.36 percent in trading Thursday to close at $10.31 per share. It’s down about 50 percent for the year to date.
According to the filing, the agreements with the fleet management companies are three to five years and call for Lordstown Motors to be the preferred supplier. They also include terms relative to orders, down payment, invoicing, delivery and payment.
Also Thursday, the company announced that John R. Whitcomb was named vice president of global commercial operations effective June 21. He will be responsible for Lordstown Motors’ go-to-market strategy ahead of the Endurance production launch.
“As we turn the corner on our road to production, we are putting in place a deeply experienced team to manage the Lordstown Endurance’s transition to commercial use …” said Jane Ritson-Parsons, newly appointed chief operating officer.
In the newly created role, Whitcomb, who most recently served as a managing director of global automotive and mobility at professional services firm Ernst & Young, will develop the business model for Lordstown Motors’ sales and service footprint.
He’s also tasked with exploring long-term international expansion strategies, according to the company.
His appointment follows a shakeup of top executive leadership that included the resignations of CEO Steve Burns, who walked away from the company he founded with a $750,000 severance package; and Chief Financial Officer Julio Rodriguez on Monday. Rodriguez was given a $200,000 severance. Appointed in their place were interim CEO Angela Strand and interim chief financial officer, Becky Roof, 65, managing director of AlixPartners LLP, a global consulting firm.
With those moves also came the announcement of of Ritson-Parsons as chief operating officer.
An SEC filing Sunday states Strand, Lordstown Motors board director since October 2020 and lead independent director since April whose experience lies in the electric-vehicle industry, will receive 50,000 shares of Class A common stock that will vest at the end of her term as CEO.
Roof, a certified public accountant, has been interim CFO at Eastman Kodak, Hudson’s Bay Company, Saks Fifth Avenue and Aceto Corp., a publicly traded generic pharma and specialty chemical company, will be paid $1,200 per hour, according to the filing.
It also states Ritson-Parsons will receive 350,000 shares of Class A stock that will vest on the first, second and third anniversaries of her employment.
Joining the executive announcements Monday was the release of findings from a special committee investigation into March 12 short-sellers report by New York-based Hindenburg Research. The committee identified issues with the accuracy of some statements regarding preorders.
Last week, the company informed the SEC it needed more money to launch commercial scale production of the truck and disclosed its doubt to remain a “going concern,” an accounting term that means a company has the financial wherewithal to meet its obligations.