Lordstown Motors
- Top execs at Lordstown Motors sold $8 million worth of stock a month before reporting disappointing financial results, according to the Wall Street Journal.
- The disclosure of the sales comes only a week after the resignations of the firm's CEO and CFO.
- Lordstown says a special committee concluded that the sales were "made for reasons unrelated to the performance of the company."
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Top executives at Lordstown Motors sold $8 million worth of stock a month before reporting financial result that missed expectations, according to a report on Monday from the Wall Street Journal.
The five Lordstown insiders, including the company's president and former CFO, sold the shares in early February, with the stock trading in the mid-to-high $20 range. By the time Lordstown reported year-end results in March, shares were languishing around $15. Weak earnings numbers that came in below expectations sent the stock lower still.
The timing of the sales raises questions about the embattled electric-vehicle maker, and comes only a week after the sudden resignations of the firm's CEO and CFO. Former CFO, Julio Rodriguez, participated in the February stock sale, cashing out smaller six-figure amounts. By contrast, Lordstown's current president, Rich Schmidt, sold 39% of his equity to the tune of $4.6 million, according to the Journal.
Lordstown says a special committee, formed in the wake of an SEC probe, concluded that the stock sales were "made for reasons unrelated to the performance of the company."
In March, short seller Hindenburg Research published allegations that Lordstown had fabricated preorder numbers for its electric truck to generate hype, prompting the stock to drop 17%. It also claimed Lordstown was much further from its production goals than it stating publicly.
Lordstown denied the allegations at the time, noting that the preorders were always supposed to be non-binding.
According to the Journal, the special committee acknowledged that some of the company's statements about the preorders were inaccurate.
Lordstown stock slid by more than 5% Monday, ending the day at $10.07.