No, it’s not Groundhog Day — the troubled Chinese electric vehicle startup will put its FF 91 into series production this March!
The company announced that its FF 91 “Futurist” electric vehicle — which received a 381 mile EPA range rating last October — is headed for series production thanks to a successful $135 million raise. This raise, together with the $33.4 million that has been received by the Company since the FF Global Investor Business Update on December 15th, 2022, (a number that includes the $10 million supplied by Senyun International Ltd. as an advanced payment) means that Faraday has received sufficient financing commitments for the funds required for SOP of the FF 91 Futurist
The press release, issued by Faraday Future this morning, is surprisingly full of financial details and caveats — likely to avoid the same kind of “funding secured” scrutiny faced by Tesla’s CEO, Elon Musk, in recent weeks. To wit, the official release reads:
Separately, the Company plans to hold a special stockholders meeting on February 28th, 2023, to consider a proposal to increase the authorized shares of Faraday Future Class A common stock. This proposal, if approved by Faraday Future stockholders, will clear the path for additional future financing to best support FF 91 Futurist deliveries and the Company’s other strategic goals. As a major stockholder of the Company, FF Top Holdings LLC, a subsidiary of FF Global Partners LLC (“FFGP”), agreed to vote all shares it beneficially owns to support such proposal in the upcoming special stockholders meeting. The Company also recommends that all Faraday Future stockholders as of January 31st, 2023 vote in favor of, and solicit proxies in favor of, such proposal. Faraday Future stockholder approval is a condition to complete a portion of the abovementioned funding amount, and a pivotal path for providing support to the Company in achieving its long-term goals. Additional information about the special stockholders meeting can be found in our definitive proxy statement on Schedule 14A previously filed with the SEC.
The financing agreements also include an important modification to a major provision in the terms of the warrants in the original FF secured financing agreements. In such warrants, there was a full ratchet anti-dilution provision that allowed investors to receive the right to purchase additional shares at a price equal to the lowest price in which shares were issued after the issuance of such warrants. The relevant clause has been removed from the warrants under the financing agreements, helping FF stockholders successfully avoid a potential future dilutive issuance of up to hundreds of millions of shares. The Company has also agreed to issue $41.0 million of convertible secured notes to its existing secured notes investors in exchange for the cancellation of a majority of their previously outstanding warrants on terms described in more detail in our Current Report on Form 8-K to be filed with the SEC.
“Securing $135.0 million in funding commitments is critical and imperative for Faraday Future’s sprint to FF 91 Futurist’s SOP,” said Xuefeng (XF) Chen, Global CEO of Faraday Future. “The availability of these additional funding commitments provides confidence that FF can reach the SOP milestone in March 2023. We will deliver the FF 91 Futurist with high quality and high product power as soon as possible after receipt of the funds contemplated by these financings.”
You can check out some photos of a dramatically lit, pre-production FF 91 in the gallery, below, then let us know what you think of Faraday’s tenacity in the comments section at the bottom of the page.