Faraday Future(FFIE) - 2021 Q2 - Quarterly Report

Financial Performance - The company reported a net loss of $5,726,988 for the three months ended June 30, 2021, primarily due to operating costs of $442,736 and changes in fair value of warrant liability of $5,012,065 [124]. - For the six months ended June 30, 2021, the company had a net loss of $7,544,047, with operating costs of $1,327,335 and changes in fair value of warrant liability totaling $5,975,238 [124]. - Net loss per common share is calculated using the two-class method, with specific calculations for redeemable and non-redeemable common stock [140]. Cash and Securities - As of June 30, 2021, the company had cash and marketable securities held in the trust account amounting to $229,788,742, intended for completing the business combination [128]. - The company raised gross proceeds of $229,775,680 from its initial public offering, with an additional $5,945,510 from the sale of private units [125]. - The company entered into Subscription Agreements for the sale of 76,140,000 shares at $10.00 per share, generating $761.4 million in gross cash proceeds [120]. - As of June 30, 2021, the company had a balance of $200,000 outstanding under a convertible promissory note with the sponsor [116]. Transaction Costs and Debt - The company incurred $5,117,030 in transaction costs related to the initial public offering, including $4,595,510 in underwriting fees [126]. - The company has no long-term debt or off-balance sheet arrangements as of June 30, 2021 [133][134]. Business Strategy - The company intends to use funds held outside the trust account primarily for identifying and evaluating target businesses [129]. - EarlyBirdCapital has been engaged as an advisor for a Business Combination, with a cash fee of 3.5% of the gross proceeds from the Initial Public Offering [135]. Accounting and Risk Management - The company accounts for Private Warrants as liabilities, adjusting their fair value at each reporting period, estimated using a Monte Carlo simulation approach [138]. - Common stock subject to possible redemption is classified as temporary equity, reflecting certain redemption rights outside of the company's control [139]. - As of June 30, 2021, the company was not subject to market or interest rate risk, with net proceeds from the Initial Public Offering invested in short-term U.S. government securities [142].