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Lordstown Motors Corp. intends to sue backer Foxconn Technology Group as the companies remain at odds over a stalled investment in the EV startup, Bloomberg News reported. Foxconn, best known for assembling iPhones for Apple Inc., remains “unlikely” to follow through on that investment, the Ohio company said in a filing with the U.S. Securities and Exchange Commission on Friday. Lordstown accused Foxconn of operating in “bad faith” and said that, without a “prompt resolution,” it “intends to enforce its rights through litigation.” A representative for Foxconn did not immediately respond to a request for comment. Lordstown revealed on May 1 that Foxconn was holding back on a $47 million investment because Lordstown’s stock had fallen below $1, which put the company in violation of the Nasdaq’s listing rules. Foxconn claimed this was a breach of the investment agreement the companies signed late last year, which was supposed to see as much as $170 million invested in the startup. The company warned it may have to seek bankruptcy protection without Foxconn’s funding.

The turmoil facing U.S. regional banks has prompted some lenders to step back, leaving space for investors such as asset managers, private-equity (PE) funds and insurers to lend more, Reuters reported. Non-bank lenders with deep pockets have invested in credit assets for years, but the regional banking crisis could supercharge their expansion into areas such as providing consumer car loans and mortgages, or financing the construction of buildings, according to industry executives. A cooling U.S. economy has also prompted some large banks to rein in lending, leaving space for money managers to step in. Direct lending by non-bank creditors contrasts with the more widespread practice of banks underwriting debt that they can sell in secondary markets. PE and investment-management firms, including Ares Management Corp., Brookfield Asset Management and KKR, are lending in areas traditionally dominated by banks. In the consumer business, $550 million of loans for homeowners buying solar panels from SunPower will be financed by KKR, under an agreement announced earlier this month. Investors are also looking for real estate opportunities. When American Lions sought financing to build a 363-unit residential building in Long Island City, it got a $250 million loan from Brookfield Asset Management. Investors providing private credit comprise 12% of the $6.3 trillion U.S. commercial credit market, according to Fitch Ratings. That compares with regional banks, which account for $4.5 trillion in loans, or 40% of the U.S. total. The International Monetary Fund painted a different picture, warning in April that the expansion of private credit may have added vulnerabilities to the financial system and called for more supervision of non-banks. The lack of public information about the loans makes it difficult for markets and regulators to measure risks “until it is too late,” the fund wrote. Some PE executives reject that criticism. (Subscription required.)

Auction house Sotheby's announced that seven non-fungible tokens (NFTs) from bankrupt cryptocurrency hedge fund Three Arrows Capital sold for about $2.5 million, Reuters reported. Of the tokens, "Fidenza #725," an image with graphic dashes and curves in a muted palette of cream, yellow, pink and black, fetched the highest price at over $1 million. Three Arrows Capital purchased it for 135 ether in 2021, equal to about $341,786 at the time, according to DappRadar. The auction was part of liquidating Three Arrows, according to Teneo, one of the court-appointed liquidators. Singapore-based Three Arrows was the first major crypto firm to go bankrupt in 2022, brought down by the collapse of cryptocurrencies Luna and TerraUSD. It filed for bankruptcy in the British Virgin Islands in late June 2022. The company at the time estimated its assets at around $1 billion, with its extensive NFT collection valued at about $22 million. NFTs are a blockchain-based asset that represents ownership of a digital item, such as an image, video or piece of text.

Prices of bonds backed by commercial mortgages have recently dropped to levels not seen since the early days of the pandemic, pointing to a growing economic threat stemming from office vacancies and rising interest rates, The Wall Street Journal reported. A small corner of the U.S. bond market, commercial-mortgage-backed securities (CMBS), have taken a beating for over a year owing to fears that owners of business parks, high-rises and other office properties could default on loans extended at a time of different work habits and lower financing costs. That stress only deepened after Silicon Valley Bank’s collapse, which raised concerns that regional banks might scale back their risk-taking and become more reluctant to make commercial real-estate loans — making it harder for property owners to refinance existing debt.The average extra yield, or spread, above U.S. Treasurys that investors were demanding to hold CMBS with a triple-B rating (the lowest broad investment-grade tier) — was 9.52 percentage points, according to an ICE BofA index. That was up from 7.6 percentage points at the end of February and approaching the 10.8 percentage point level reached in March 2020. The average price of the bonds has dropped to around 75 cents on the dollar from roughly 89 cents a year ago.

Bed Bath & Beyond Inc.’s shares dropped another 28% Friday to below 43 cents, continuing a slide triggered by the news a day ago that the troubled retailer has pivoted to a last-ditch stock-sale effort, WSJ Pro Bankruptcy reported. The home-goods retailer needs the capital to avoid bankruptcy as it contends with steep sales declines. The tanking stock price could make it more difficult for the company to raise the amount of capital it needs to stay afloat. Bed Bath had been raising money through a complex equity arrangement with Hudson Bay Capital Management LP, from which it has raised about $360 million since February. But on Thursday, the company said it has terminated the deal and instead went with a new equity offering led by investment bank B. Riley Securities Inc. in an effort to raise up to $300 million by selling shares into the open market. Bed Bath & Beyond determined that it would be better off shifting to a deal in which it would have less constraints with stock-price and trading-volume thresholds, and could get more cash per share by issuing them at a smaller or no discount, people familiar with the matter said. The company then moved forward with the alternate equity financing led by investment bank B. Riley that will enable it to sell more shares sooner, they said. Bed Bath & Beyond said Thursday that it expects to file for bankruptcy if the new stock offering fails to come through. The company also disclosed an amendment to its credit agreement with its senior lenders Sixth Street Specialty Lending and JPMorgan Chase & Co., in which it must raise at least $140 million of proceeds by May 2.