Faraday Future Intelligent Electric Inc. (NASDAQ: FFIE) (“Faraday Future” or “the Company”), a California-based global shared intelligent electric mobility ecosystem company, today announced a comprehensive resolution to its governance dispute with FF Top and the execution of definitive agreements for new financing. The Company continues to have active discussions with capital providers to fund the production and delivery of the FF 91.
The Company announced a binding governance agreement with FF Top Holding LLC (“FF Top”), which resolves a range of issues concerning governance. The governance agreement, which is described in greater detail in our Current Report on Form 8-K filed earlier today, includes an agreement for FF Top to withdraw its lawsuit against the FFIE board immediately, changes in FFIE board membership and board size, and certain amendments to Faraday Future’s Shareholder Agreement with FF Top. Adam He has been appointed as a new independent board member and a member of the Nominating and Corporate Governance Committee and Audit Committee.
“The resolution of governance and related issues with our largest shareholder is a major accomplishment and an important step forward for Faraday Future and all our stakeholders. We can now focus our effort on building the FF 91. We appreciate all parties’ efforts in reaching this agreement,” said Dr. Carsten Breitfeld, Global CEO of Faraday Future.
“FF Top is glad that a resolution has been reached. We look forward to this opportunity for a new start and brighter future for FFIE, and to all parties performing their obligations under the governance agreement, to achieve the best interests of Faraday Future and all shareholders,” said a spokesperson from FF Top.
Concurrently, the Company announced the execution of two definitive agreements for new financing commitment of up to $100 million total. Detailed terms can be found in our Current Report on Form 8-K filed earlier today.
- Under the first financing agreement, Faraday Future will receive up to $40 million in near-term funding in the form of convertible secured notes and warrant exercise payments, subject to certain conditions precedent.
- Under a separate second financing agreement, the Company will receive up to an additional $60 million in near-term funding from Senyun International Ltd., a Daguan International Ltd. wholly owned investment entity, in the form of convertible secured notes, subject to certain conditions precedent. The terms of such financing are substantially similar to the terms of the previously committed notes but are subject to satisfactory completion of due diligence by the Company in its sole discretion on the investor and a specified funding schedule with milestones.
The Company is in ongoing discussions with potential financing sources for additional capital required to fund operations through the end of 2022 and beyond. As part of ongoing efforts to conserve cash and reduce expenses, the Company recently implemented headcount reductions and other expense reduction and payment delay measures. Further efforts, including additional headcount reductions, may be undertaken in response to the Company’s financial condition and market conditions. Additional information can be found in our Current Report on Form 8-K filed earlier today.
Mr. Adam He, the newly appointed independent board member, is the Chief Financial Officer of Wanda America Investment Group. He previously served as an auditor with Ernst & Young and is a CPA in China and New York, and holds a bachelor’s degree and Master of Science in Taxation from the Central University of Finance and Economics in Beijing and a Master of Science in accounting from Seton Hall University in New Jersey. Additional details regarding Mr. He’s background can be found in our Current Report on Form 8-K filed earlier today.
Sidley Austin LLP served as legal counsel to Faraday Future, Blank Rome LLP and Kelley Drye & Warren LLP served as legal counsel to the agent under the convertible notes facility, Olshan Frome Wolosky LLP served as legal counsel to Senyun International Ltd., and Davis Polk & Wardwell LLP served as legal counsel to the Company’s Board of Directors. Cadwalader, Wickersham & Taft LLP served as legal counsel for FF Top and Baker McKenzie served as legal counsel for Season Smart Limited.News Source: Businesswire