Lordstown Motors has announced on Wednesday that it has entered into a definitive asset purchase agreement with Foxconn.

In late September, the two companies entered into an agreement in principle (AIP) to work jointly on Lordstown's electric vehicle programs at the Lordstown production and assembly plant.

Shortly after the agreement, Foxconn purchased $50 million of common stock directly from Lordstown Motors at $6.8983 per share.

The terms of the definitive asset purchase agreement are as follows: 

-Lordstown Motors has agreed to sell the Lordstown Facility to Foxconn excluding certain assets such as the hub motor assembly line and battery module and pack line for $230 million.

-Foxconn has agreed to make a down payment of the purchase price of $100 million by November 18, and subsequent down payments of $50 million on each of February 1, 2022 and no later than April 15, 2022. The balance of the purchase price will be paid at closing.

-The parties have agreed to pursue a contract manufacturing agreement for the Endurance pickup truck, which must be entered before closing - currently targeted by April 30, 2022. 

-Lordstown Motors and Foxconn will pursue a join venture agreement to co-design and develop vehicle programs for the global commercial fleet market using the MIH open platform. Lordstown and Foxconn would have the rights to commercialize these new EV programs in North America and internationally.

-Upon the closing, Foxconn will receive 1.7 million warrants to acquire Lordstown common stocks, exercizable for three years, at a price of $10.50 per share.

The closing of the transactions contemplated by the agreement is subject to closing conditions, including entry to the contract manufacturing agreement, regulatory approvals and other customary closing conditions.

Foxconn's Chairman, Young Liu and Lordstown Motors' CEO, Daniel Ninivaggi both weighed in on the new partnership.

"This partnership marks the commencement of integrating our resources with Lordstown Motors to develop Ohio into [Foxconn's] most important electric vehicle manufacturing and R&D hub in North America. As we look to inject [Foxconn's] software and hardware capabilities in the information and communications industry with the wealth of automotive experience that resides in this town and our partners, we will be able to provide customers with more real-time and efficient electric vehicle products," said Liu.

"We are happy to have formed a strategic partnership with a company as innovative and forward thinking as Foxconn. I believe in their EV strategy and look forward to a substantial collaboration in the future. In my view, this transaction provides LMC a better opportunity to fulfill its original mission of satisfying the growing demand for electric vehicles, particularly in the underserved commercial market, with a more flexible business model," said Ninivaggi.


"We are happy