Lordstown Motors Stock Closes at All-Time Low
LORDSTOWN, Ohio – Shares of Lordstown Motors Corp. fell to their lowest level yet Thursday as the electric-vehicle manufacturer continues to work through recalls of its flagship vehicle, the Endurance pickup.
Lordstown Motors’ stock tumbled another 3.4% on Thursday to 67 cents per share.
Thursday marked the 13th trading day in a row that Lordstown’s stock has closed under $1. The company’s stock, which trades on Nasdaq under the ticker RIDE, last closed above that threshold March 6, when the share price ended the day trading at $1.02.
That’s important because a company that trades under $1 for 30 consecutive business days could trigger a deficiency notice from the exchange, according to Nasdaq’s listing rules.
Under Nasdaq rules, a company whose stock trades below the $1 closing bid price requirement for 30 consecutive business days would then be notified that it has 180 calendar days to regain compliance, according to Nasdaq.
Should the company fail to regain compliance, a second 180-day compliance period may be available, according to Nasdaq.
A second extension would be awarded if the company meets the market value of publicly held shares requirement for continued listing and all other initial inclusion requirements for the Capital Market, and provides written notice that it intends to regain compliance with the bid price requirement through a reverse stock split if necessary, according to exchange rules.
Should a company fail to resolve its bid price deficiency during the compliance period, Nadaq would then issue a delisting letter. The company could then request a hearing before a hearing panel, which would stay any delisting. The company would then have an opportunity to present a plan of compliance for the hearing board to consider.
In June 2021, Lordstown Motors received a notice of delinquency from Nasdaq because it had failed to file its quarterly report on time. The company filed its 10-Q four days later in compliance with Nasdaq rules.
Last month, Lordstown Motors announced it had issued a voluntary recall on 19 Endurance pickups because it was found that several vehicles had lost propulsion. The company also announced earlier this month that it had initiated a recall of five other Endurance trucks because of a faulty component in its braking systems.
Production has been halted on the Endurance until the measures are corrected.
Lordstown Motors last year sold its plant to Taiwanese tech giant Foxconn for $230 million. Foxconn builds the Endurance at the plant per a contract manufacturing agreement the parties signed last May.
Foxconn also announced it would invest another $100 million in Lordstown Motors toward future products built on Foxconn’s Mobility-in-Harmony, or MIH, platform.
Lordstown Motors announced in August 2020 that it would go public through a special purpose acquisition company, or SPAC, DiamondPeak Holdings Corp. Share prices of DiamondPeak closed at a high of $29.01 on Sept. 8, 2020.
Lordstown Motors merged with the company and went public in October of that year.
Shares of Lordstown Motors are down more than 97% from their highest close in September 2020. Over the past 52 weeks, RIDE stock is down 79%.
Copyright 2023 The Business Journal, Youngstown, Ohio.