Lordstown Motors Corp. is hosting investors, analysts, customers and partners at its plant near Youngstown, Ohio, this week to demonstrate how the company is getting ready to begin producing its first model — an electric pickup truck for fleet operators.
The emerging growth company also likely will use the event — scheduled a month ago — to win the confidence of investors and customers who could help it overcome a cash crunch that is limiting a full production start in late September.
Shares of Lordstown Motors, which went public in October by merging with a special purposes acquisition company, have fallen more than 40% since a short-selling firm issued a March report saying the company had misled investors about its truck preorders and progress toward putting its first model into production.
A week ago, Steve Burns, founder, chief executive officer and chairman, and Julio Rodriguez, chief financial officer, resigned as a company investigation revealed "issues regarding the accuracy of certain statements regarding the company's pre-orders," Lordstown Motors said in a statement.
And on Monday, the Wall Street Journal reported that five top executives — including President Rich Schmidt and executive Chuan Vo — sold more than $8 million in stock over three days in early February prior to reporting disappointing financial results this spring.
Most publicly traded companies have "blackout periods" around the time of quarterly earnings reports that prohibit executives from buying or selling shares to head off any hint of insider trading activity.
At best, the stock sales by Lordstown Motors executives could indicate weak internal controls, the WSJ reported.
The company has received two subpoenas from the Securities and Exchange Commission related to its merger and public statements, according to regulatory filings.
Lordstown Motors shares (Nasdaq: RIDE) were down about 3% to $10.34 in late afternoon trading on Monday.
