Hyzon Motors Inc. announced a change of leadership in the wake of missing the deadline to file second-quarter results with the Securities and Exchange Commission amid a “myriad of issues,” including accounting irregularities.
Hyzon appointed Chief Strategy Officer Parker Meeks as president and interim CEO, effective immediately, replacing Craig Knight, who is also departing from his role as a director of the company. Hyzon’s board of directors plans to initiate a search to identify potential external and internal candidates to serve as the next CEO.
Hyzon was established in 2020 as a spin-off from Singapore-based Horizon Fuel Cell Technologies to develop fuel-cell-powered trucks and buses. The company went public last year via a SPAC (special purposed acquisition company) merger with Decarbonization Plus Acquisition Corporation. Hyzon has U.S. operations in the Rochester, New York, Chicago, and Detroit areas, and international operations in the Netherlands, China, Australia, and Germany. The company says it is using its proven hydrogen fuel cell technology to supply zero-emission heavy-duty trucks and buses to customers in North America, Europe and other countries.
In a 2021 interview with HDT, then-CEO Craig Knight called Hyzon “kind of an 18-year-old startup. The parent company that founded this business, Horizon Fuel Cell Technologies, is a company that I set up in 2003, together with our Chairman George Gu and some other guys. I no longer work in that business. I am 100% focused on this downstream, what we call an application business, for fuel cell technology.”
Hyzon Challenged With Accounting, Production Issues
Earlier this month, Hyzon disclosed in an 8-K filing with the SEC that it was investigating “certain issues regarding revenue recognition timing and internal controls and procedures, primarily pertaining to its China operations …[including] the recognition of revenue for the year ended December 31, 2021.”
In that same filing, Hyzon reported it’s restructuring its European operations due to “operational inefficiencies” at its joint venture with Holthausen that affect its ability to produce and sell vehicles. In May, it had entered into a stock purchase agreement with Holthausen to buy about 25% of the shares of the Hyzon Motors Europe JV, which would have given Hyzon a 75% stake, but that deal appears to be off.
Hyzon also said it’s withdrawing all financial and operational guidance it has previously issued.
The company’s stock prices plunged after the news.
On Aug. 17, Hyzon announced it had received a notice from Nasdaq stating that because the company has not yet filed its second quarter report on Form 10-Q, Hyzon is no longer in compliance with Nasdaq rules requiring companies listed on the exchange to timely file all required periodic reports with the Securities and Exchange Commission.
The notification letter has no immediate effect on the listing or trading of Hyzon shares, but the company must submit a plan within 60 days on how it intends to get back in compliance with Nasdaq’s listing rules. If Nasdaq accepts the company’s plan, it may grant an extension.
At least two law firms are investigating Hyzon. Labaton Sucharow, a shareholder rights law firm, announced that it is investigating Hyzon for potential violations of federal securities laws. Faruqi & Faruqi LLP, a national securities law firm, also said it is investigating potential claims.
More about Hyzon’s Leadership Transition
“Parker Meeks has the depth and breadth of experience in the energy, infrastructure, and transportation sectors to provide the leadership and operational expertise Hyzon needs at this critical juncture in the global energy transition,” said Elaine Wong, Hyzon’s lead independent director, in a news release.
Meeks said his priority is to ensure the company’s manufacturing capacity is in place with the ability to scale production efficiently. “I believe our core fuel cell technology is a distinct competitive advantage, that will allow us to innovate and introduce high-performance vehicles that support the transition to clean energy.”
The new interim CEO has nearly two decades of experience supporting businesses in the energy, infrastructure, and transportation sectors, including development of emerging energy technologies and supply networks, according to Hyzon. Meeks has served as chief strategy officer since June 2021. Prior to that he was president, Infrastructure Sector, for TRC Companies, a design and construction management business in transportation, renewable energy and water resources end markets. From 2012 to 2018, he was partner of McKinsey & Company, a global management consulting services company that he joined in July 2005. He holds an M.B.A in Finance from William Marsh Rice University and a B.S. in Electrical Engineering from Columbia University.