compile / Zhang Ou
edit / Wen Sha
design / Zhao Haoran
source / Wall Street Journal, Reuters, Pandaily, author: Will Feuer, Kathryn Hardison
A car has not been delivered to customers, and the farce has been staged one after another. Faraday Future Intelligent Electric, a startup company that said on September 22 that the company's leaders were "misleading propaganda" and even faced a death threat in their attempt to raise funds for the production of the first car.
Three days after the statement was made by Faraday , one of the largest shareholders of the Los Angeles auto company filed a lawsuit in the Delaware Supreme Court, saying that the current board of directors has "turned the company into a desperate situation" since its merger with special purpose acquisition company (SPAC), earlier in 2022.
shareholder group FF Top Holding LLC controls 20% of Faraday Future's shares, but owns about 36% of the voting rights. The group asked two directors to resign or remove them—Susan Swenson, executive chairman and long-time technical director, and another director, Brian Krolicki.
is located in the Faraday Future plant in html , California (Photo source: Faraday Future)
Faraday said in a statement: "Unfortunately, efforts to raise funds have been affected by completely unfounded misinformation, and some directors are plotting unnecessary bankruptcy for their own personal interests."
Faraday Future did not elaborate on the rumors, but whistleblowers claimed that the directors include Susan Svenson, Brian Crowleyki, who served as governor of Nevada, Scott Vogel and Jordan Vogel.
The startup said it hired a law firm to conduct an independent investigation into the director's allegations, but found the allegations "unfounded."
However, the allegations continue, "the threat that began with the lawsuit has escalated into a threat of personal violence, or even a death threat." Faraday said.
It is submitting these threats to law enforcement, including FBI and SEC , as well as the Department of Justice and international agencies.
Faraday said earlier in 2022 that certain employees and members of the company's management team had received subpoenas from the U.S. Securities and Exchange Commission involving investigations into the company's financial statements. In June, it also received a request for preliminary information from the Ministry of Justice.
Faraday said they will work with law enforcement to support any investigation and prosecution of those involved in the threat. The company added that this behavior is "inappropriate and unacceptable" and the persons responsible should be brought to justice.
Faraday Future's luxury electric car FF91 was unveiled at its company headquarters in Gardena, California, USA on November 21, 2019. (Photo source: REUTERS/Lucy Nicholson)
Since the first model was released in 2017, this startup that has been constantly catching horses has been delaying its flagship model FF 91. It accumulated a lot of debt and lost executives — poached by another electric vehicle startup from one of its competitors.
As the capital market cools down, Faraday Future's process of raising funds for producing cars was not smooth. It has also been fighting high costs and supply chain disruptions, delaying FF 91 production to the fourth quarter of 2022.
Faraday said in August that it needed more funds to keep operations by early September, with the company only $47.2 million in cash as of August 26. Since then, it has been focused on reducing costs and maintaining cash.
FF Top said in the lawsuit that Faraday failed to complete its expected plan - starting to produce the FF 91 model in July, just squandering the company's cash.It believes Faraday has encountered a leadership crisis at the board level, and urgent changes are needed first before the company raises more money to put into production.
Faraday spokesman Mark Connelly said the dispute with FF Top further limits Faraday's ability to raise funds in difficult markets.
"We are actively negotiating with some people," he said. "The top priority of the board is to raise funds and get the car on the road as soon as possible."
The company's stock hit a 74-cent intraday low on September 22. Trading has been declining since the stock price hit an intraday high of $7.85 on July 18, despite a brief rebound in early August, according to FactSet.
This article is originally produced by Automobile Business Review
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