Financial Data and Key Metrics Changes - Operating expenses decreased by 92.6% to $3.8 million compared to $50.9 million in the prior year's quarter, reflecting ongoing cost control initiatives and a nonrecurring gain of $14.9 million from the settlement of previously accrued R&D costs [30] - Loss from operations improved to $25.2 million compared to a loss of $66.4 million in the prior year quarter [31] - Total assets as of September 30, 2024, were $449 million, total liabilities were $292.3 million, and cash at the end of the quarter was $7.3 million [32] Business Line Data and Key Metrics Changes - Two FF91 2.0 vehicles were delivered during the third quarter, bringing total deliveries to 14 vehicles to date [14] - Manufacturing improvements included bringing certain vehicle body and interior component production in-house, reducing interior costs by half [15] Market Data and Key Metrics Changes - The U.S. EV penetration rate remains below 20%, but range extender AIEVs have shown strong adoption in other markets, indicating a potential opportunity for the planned FX product lineup [20] Company Strategy and Development Direction - The company is focused on transforming from a project-driven to an operation-driven organization with an emphasis on cost optimization and operational efficiency [9] - The launch of the FX brand targets mass market segments, with two initial models planned in the $20,000 to $50,000 range [19] - The company aims to strengthen core operations, advance the dual brand strategy, and pursue strategic partnerships to support growth objectives [24] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of achieving profitability and becoming self-funding in the shortest possible time [35] - The dual brand strategy is expected to leverage high-value traditional FF brand with Chinese OEMs to gain economies of scale [36] Other Important Information - The company regained full Nasdaq listing requirements compliance and completed a reverse stock split [13] - A co-investment agreement was established with Master Investment Group to set up a regional headquarters in Ras Al Khaimah [22] Q&A Session Summary - No specific questions or answers were documented in the provided content, indicating the end of the Q&A session without further inquiries [42]

Faraday Future Intelligent Electric Inc. (Nasdaq: FFIE) Fiscal Third Quarter 2024 Earnings Presentation November 6th, 2024 © 2024 FARADAY FUTURE PROPRIETARY AND CONFIDENTIAL Table of Contents 2 01. Company Overview 02. Business Update 03. The FF 91 2.0 Futurist 04. Faraday X 05. Financials 06. Imagery © 2024 FARADAY FUTURE PROPRIETARY AND CONFIDENTIAL Legal Disclaimers 3 Forward Looking Statements This presentation includes "forward looking statements" within the meaning of the safe harbor provisions of the ...

Investment and Development - Faraday Future has invested $3.0 billion to develop its EV platform and AI technology[3] - The company aims for an annual production capacity of 10,000 vehicles[3] - Faraday Future launched its second brand, Faraday X, targeting mass market segments with models priced between $20,000 and $50,000[8] - The company has entered preliminary agreements with four OEMs for the development of the Faraday X brand[8] - The company aims to empower users to co-create an AIEV (Artificial Intelligence Electric Vehicle) with an extreme cost-experience ratio, targeting growth in the untapped AIEV market[15] Financial Performance - The company reported a revenue of $21,453 thousand for the three months ended September 30, 2024, compared to $551 thousand for the same period in 2023, indicating a significant increase[24] - The gross profit for the three months ended September 30, 2024, was $(21,444) thousand, while for the same period in 2023, it was $(15,580) thousand, reflecting a worsening in gross profit margin[24] - Operating expenses for the three months ended September 30, 2024, totaled $50,867 thousand, compared to $56,618 thousand for the same period in 2023, showing a decrease in operating expenses[24] - The net loss for the three months ended September 30, 2024, was $(77,686) thousand, slightly improved from $(78,046) thousand in the same period of 2023[24] - Research and development expenses for the three months ended September 30, 2024, were $5,180 thousand, down from $21,593 thousand in the same period of 2023, indicating a reduction in R&D spending[24] Manufacturing and Deliveries - In Q3 2024, Faraday Future completed a $30 million financing round, resulting in net proceeds of approximately $28.5 million[7] - Two FF 91 2.0 vehicles were manufactured and delivered in Q3 2024, bringing total deliveries to 14 vehicles[7] - Manufacturing improvements have reduced interior costs by approximately 50% and improved inspection findings by 25% compared to the previous quarter[7] - The FF 91 2.0 Futurist features a tri-motor system with an EPA-rated range of 381 miles and 1,050 HP[10] Strategic Initiatives - A regional headquarters is planned in Ras Al Khaimah, with construction expected to commence by the end of 2024[9] - The company has established a user ecosystem with a focus on direct online sales and co-creation strategies, aiming to enhance customer engagement and conversion rates[14] - The company plans to launch two hit models in the first phase of its product rollout, targeting a price range of $20,000 to $50,000[13] Assets and Liabilities - The total current assets as of September 30, 2024, were $79,685 thousand, compared to $91,364 thousand as of December 31, 2023, indicating a decrease in current assets[20] - The total liabilities as of September 30, 2024, were $292,330 thousand, compared to $302,303 thousand as of December 31, 2023, showing a reduction in total liabilities[23] Leadership and Innovation - Faraday Future has strengthened its leadership team with key appointments to drive product innovation and market expansion[6]

Financial Data and Key Metrics Changes - Operating expenses improved significantly to $29.9 million compared to $49.4 million in the prior year quarter [13] - Loss from operations improved to $50.6 million compared to a loss of $56.0 million in the prior year quarter [13] - Cash from operating activities improved to a $29.1 million outflow compared to an outflow of $160.7 million in the six months ended June 30th, 2023 [14] - The company had $457.9 million of assets, $309.2 million of liabilities, and a book value of $148.7 million at quarter end June 30th, 2024 [14] - Approximately $15.5 million of gross financing was raised through convertible debt during Q2 2024 [14][15] Business Line Data and Key Metrics Changes - The company delivered two more FF 91 2.0 EVs since June, bringing the total to 13 vehicles delivered to date [9] - The cost of interior parts has been cut by more than half due to in-house production of vehicle body and some interior components [10] Market Data and Key Metrics Changes - The establishment of a Middle Eastern sales entity in Dubai marks an important milestone in the company's expansion plans [11] - The company is exploring opportunities in the Middle East, including strategic financing and business development [11] Company Strategy and Development Direction - The new China-U.S. Automotive Bridge Strategy aims to leverage AI and software technology across multiple market segments [5][7] - The company plans to establish a second mass market-focused brand by collaborating with China-based OEMs and part suppliers [7] - The focus remains on stabilizing operations and achieving profitability in the shortest possible time [16] Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about the path ahead and confidence in achieving and exceeding objectives [17] - The company believes that the biggest barrier to vehicle sales and profitability is the capital required to produce vehicles at scale [15] Other Important Information - The company continues to seek strategic financing to support production ramp-up and the development of the China-U.S. Automotive Bridge Strategy [8] - The company remains compliant with Nasdaq's reporting requirements [8] Q&A Session Summary - The conference call concluded without a Q&A session, as indicated by the operator's closing remarks [18]

Patents and Production - As of June 30, 2024, the company has been granted approximately 660 patents globally[289]. - The company started production of the FF 91 Futurist and delivered the first FF 91 2.0 Futurist Alliance in 2023[289]. - The planned B2C passenger vehicle pipeline includes the FF91 series, FF81 series, and FF71 series[289]. - The FF 81 is expected to compete against the Tesla Model S and similar vehicles, while the FF 71 is designed to compete with the Tesla Model 3 and BMW 3-series[290]. - The company began delivering its first electric vehicle, the FF 91 Futurist, in the third quarter of 2023, following the start of production in April 2023[325]. - Automotive sales revenue was $0.3 million for the three months ended June 30, 2024, as vehicle deliveries began in the third quarter of 2023[324]. - Automotive sales revenue was $0.3 million, with the first electric vehicle, the FF 91 Futurist, starting production in March 2023[345]. Financial Performance - Revenue for the three months ended June 30, 2024, was $0.293 million, a significant increase from $0 in the same period in 2023[323]. - Revenue for the six months ended June 30, 2024, was $0.3 million, a significant increase from $0 in the same period in 2023[344]. - Cost of revenues for the three months ended June 30, 2024, was $20.97 million, compared to $6.613 million in 2023, resulting in a gross profit loss of $20.677 million[323]. - Cost of revenues for the six months ended June 30, 2024, was $41.7 million, representing a 530% increase from $6.6 million in 2023[346]. - The net loss for the period was $108.685 million, compared to a net loss of $124.928 million in the same quarter of 2023, indicating an improvement[323]. - Loss from operations for the six months ended June 30, 2024, was $94.2 million, an improvement from a loss of $151.8 million in 2023[344]. - Loss on settlement of notes payable decreased to $58.4 million, a 68% reduction from $183.5 million in the same period last year[360]. Expenses and Cost Management - Research and development expenses decreased to $3.317 million from $25.269 million year-over-year, indicating a reduction in R&D activities[323]. - Research and development expenses decreased to $10.0 million for the six months ended June 30, 2024, down 88% from $83.1 million in 2023[348]. - Sales and marketing expenses were $1.782 million, down from $7.699 million in the previous year, reflecting cost control measures[323]. - Sales and marketing expenses dropped to $4.3 million, a 67% decrease from $12.8 million in the prior year[349]. - General and administrative expenses increased slightly to $17.201 million from $17.062 million, showing stability in administrative costs[323]. - General and administrative expenses were $31.0 million, down 29% from $43.6 million in 2023[350]. - A lease impairment loss of $7.5 million was recognized due to the termination of leases for a store and a research facility during the three months ended June 30, 2024[330]. Cash Flow and Liquidity - Net cash used in operating activities was $29.1 million for the six months ended June 30, 2024, a significant decrease from $160.7 million for the same period in 2023[386]. - Net cash used in investing activities was $0.3 million for the six months ended June 30, 2024, compared to $25.9 million for the same period in 2023, indicating a reduction in fixed asset acquisitions[387]. - Net cash provided by financing activities was $26.7 million for the six months ended June 30, 2024, down from $181.8 million for the same period in 2023[388]. - The company continues to experience negative cash flows from operations due to investments in R&D for electric vehicles and infrastructure development in the U.S. and China[385]. - The company reported an accumulated deficit of $4,115.4 million and an unrestricted cash balance of $0.8 million as of June 30, 2024[369]. - The company has commitments totaling $554.5 million under various SPA agreements, with $343.2 million funded and $211.3 million remaining to be funded as of June 30, 2024[370]. - The company’s primary source of liquidity is the issuance of various convertible note instruments due to restrictions on accessing the ATM Program[372]. Strategic Initiatives - The company plans to develop a Smart Last Mile Delivery vehicle to address high-growth delivery opportunities in Europe, China, and the U.S.[292]. - The company has updated its corporate strategy to include a China-U.S. Automotive Bridge Strategy, aiming to establish a second mass-market brand[293]. - A Middle Eastern sales entity was established in Dubai, U.A.E. on April 9, 2024[300]. - The company held an interactive investor Community Day at its Los Angeles headquarters on July 20, 2024[300]. - Nasdaq granted the company continued listing on Nasdaq subject to compliance with periodic reporting requirements by July 31, 2024[302]. Debt and Related Party Transactions - The company incurred a related party interest expense of $6.6 million for the six months ended June 30, 2024, reflecting a 9329% increase from the prior year[365]. - Related party interest expense increased significantly to $(1.5) million, a rise of $1.4 million or 2051% from $(70,000) in 2023, due to default on a related party note[341]. - As of June 30, 2024, the company had outstanding principal of $7.6 million and interest payable of $18.5 million related to its debt agreement with Chongqing Leshi Small Loan Co., Ltd.[377]. - The company has been in default on SPA commitments since April 2023 and is presenting related notes as current[377]. - The company has the right to issue and sell up to an additional $192.5 million of Class A Common Stock under the Standby Equity Purchase Agreement as of June 30, 2024[371]. Accounting and Estimates - Management's estimates for financial reporting are based on historical experience and reasonable assumptions, but actual results may differ significantly[392]. - There have been no changes to critical accounting estimates that have materially impacted the financial statements as of the date of this report[393]. - The effect of exchange rate changes on cash and restricted cash was immaterial for the six months ended June 30, 2024, compared to $5.6 million for the same period in 2023[389]. - The company did not have any off-balance sheet arrangements as of June 30, 2024[390].

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents Faraday Future's unaudited condensed consolidated financial statements for Q1 2024, covering balance sheets, operations, equity, cash flows, and detailed notes [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This item presents Faraday Future's unaudited condensed consolidated financial statements for Q1 2024, including balance sheets, statements of operations, equity, cash flows, and detailed notes [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents Faraday Future's financial position, detailing assets, liabilities, and stockholders' equity as of March 31, 2024, and December 31, 2023 | Metric (in thousands) | March 31, 2024 | December 31, 2023 | | :-------------------- | :------------- | :---------------- | | **Assets:** | | | | Cash | $407 | $1,898 | | Total current assets | $82,736 | $91,364 | | Total assets | $499,941 | $530,539 | | **Liabilities:** | | | | Total current liabilities | $256,990 | $261,176 | | Total liabilities | $298,422 | $302,303 | | **Stockholders' Equity:** | | | | Total stockholders' equity | $201,519 | $228,236 | - The company's cash balance significantly decreased from **$1,898 thousand** at December 31, 2023, to **$407 thousand** at March 31, 2024[8](index=8&type=chunk) - Total assets decreased by approximately **$30.6 million**, and total liabilities decreased by approximately **$3.9 million** from December 31, 2023, to March 31, 2024[8](index=8&type=chunk)[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20(Unaudited)) This section outlines Faraday Future's financial performance for the three months ended March 31, 2024 and 2023, including revenue, expenses, and net loss | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 (As Restated) | | :-------------------- | :-------------------------------- | :---------------------------------------------- | | Revenue | $2 | $— | | Cost of revenues | $20,687 | $— | | Gross Profit | $(20,685) | $— | | Research and development | $6,688 | $57,808 | | Sales and marketing | $2,474 | $5,065 | | General and administrative | $13,848 | $26,513 | | Total operating expenses | $22,923 | $95,848 | | Loss from operations | $(43,608) | $(95,848) | | Net loss | $(48,217) | $(144,973) | | Basic Net loss per share | $(0.66) | $(48.22) | - Net loss significantly decreased from **$(144,973) thousand** in Q1 2023 to **$(48,217) thousand** in Q1 2024, primarily due to reduced operating expenses[11](index=11&type=chunk) - Research and development expenses decreased by **88% YoY**, from **$57,808 thousand** to **$6,688 thousand**, reflecting the substantial completion of FF91 R&D[11](index=11&type=chunk) - Sales and marketing expenses decreased by **51% YoY**, from **$5,065 thousand** to **$2,474 thousand**, due to cost-saving measures and headcount reduction[11](index=11&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Unaudited)) This section details changes in Faraday Future's stockholders' equity for the three months ended March 31, 2024, including impacts from net loss and stock conversions | Metric (in thousands, except share data) | Balance as of Dec 31, 2023 | Conversion of notes payable | Stock-based compensation | Net loss | Balance as of Mar 31, 2024 | | :--------------------------------------- | :------------------------- | :-------------------------- | :----------------------- | :------- | :------------------------- | | Class A Common Stock (shares) | 42,433,025 | 116,945,093 | — | — | 159,390,384 | | Additional paid-in capital | $4,180,869 | $20,714 | $542 | — | $4,202,125 | | Accumulated deficit | $(3,958,499) | — | — | $(48,217) | $(4,006,716) | | Total stockholders' equity | $228,236 | $20,726 | $542 | $(48,217) | $201,519 | - Total stockholders' equity decreased from **$228,236 thousand** at December 31, 2023, to **$201,519 thousand** at March 31, 2024, primarily due to the net loss[14](index=14&type=chunk) - The number of Class A Common Stock shares issued and outstanding increased significantly from **42,433,025** to **159,390,384** due to the conversion of notes payable and accrued interest[14](index=14&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) This section presents Faraday Future's cash flow activities for the three months ended March 31, 2024 and 2023, categorized into operating, investing, and financing | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 (As Restated) | | :-------------------- | :-------------------------------- | :---------------------------------------------- | | Net cash used in operating activities | $(14,719) | $(102,980) | | Net cash used in investing activities | $(12) | $(16,873) | | Net cash provided by financing activities | $12,013 | $134,443 | | Net change in cash and restricted cash | $(2,720) | $14,760 | | Cash and restricted cash, end of period | $1,305 | $33,274 | - Net cash used in operating activities decreased substantially from **$(102,980) thousand** in Q1 2023 to **$(14,719) thousand** in Q1 2024[21](index=21&type=chunk) - Net cash provided by financing activities decreased from **$134,443 thousand** in Q1 2023 to **$12,013 thousand** in Q1 2024[21](index=21&type=chunk) - Cash and restricted cash at the end of the period significantly declined from **$33,274 thousand** in Q1 2023 to **$1,305 thousand** in Q1 2024[21](index=21&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanatory notes to Faraday Future's unaudited condensed consolidated financial statements, covering business, accounting policies, and key financial items [1. Nature of Business and Organization and Basis of Presentation](index=9&type=section&id=1.%20Nature%20of%20Business%20and%20Organization%20and%20Basis%20of%20Presentation) This note describes Faraday Future's business as an intelligent electric vehicle company, its manufacturing capabilities, and the basis for its financial statement presentation - Faraday Future designs and engineers next-generation, intelligent, electric vehicles, manufacturing them at its FF ieFactory California in Hanford, California, with additional capabilities in China[27](index=27&type=chunk) - Revenue for Q1 2024 was less than **$0.1 million**, primarily from automotive leasing, with no automotive sales revenue recognized in Q1 2023[36](index=36&type=chunk) - The company applies a five-step model for revenue recognition under ASU 2014-09, recognizing automotive sales revenue upon vehicle delivery and OTA software updates over time[35](index=35&type=chunk)[37](index=37&type=chunk) - The company provides a manufacturer's warranty on all vehicles sold, with an accrued warranty balance of **$658 thousand** as of March 31, 2024[47](index=47&type=chunk)[48](index=48&type=chunk) [2. Liquidity and Capital Resources and Going Concern](index=15&type=section&id=2.%20Liquidity%20and%20Capital%20Resources%20and%20Going%20Concern) This note addresses Faraday Future's liquidity challenges, capital resources, and the substantial doubt regarding its ability to continue as a going concern - Faraday Future has substantial doubt about its ability to continue as a going concern due to recurring losses, negative cash flows, an accumulated deficit of **$4,006.7 million**, and a negative working capital of **$175.2 million** as of March 31, 2024[65](index=65&type=chunk)[67](index=67&type=chunk) - The company has **$211.3 million** remaining to be funded from SPA Commitments and **$325.4 million** from Optional Commitments, subject to various conditions[68](index=68&type=chunk) - As of March 31, 2024, the company had the right to issue and sell up to an additional **$192.5 million** (or **$342.5 million** with option exercise) of Class A Common Stock under the SEPA[69](index=69&type=chunk) - The ATM Program, a primary source of liquidity since September 2023, is currently inaccessible due to the company's failure to timely file its Form 10-K and 10-Q, rendering it not S-3 eligible[70](index=70&type=chunk) - The company is in default on SPA Commitments and in breach of a debt agreement with Chongqing Leshi Small Loan Co., Ltd. (a related party) since January 1, 2024, with an outstanding principal of **$7.6 million** and interest of **$17.4 million**[75](index=75&type=chunk) [3. Inventory](index=16&type=section&id=3.%20Inventory) This note provides a breakdown of Faraday Future's inventory, including raw materials, work in progress, and finished goods, as of March 31, 2024, and December 31, 2023 | (in thousands) | March 31, 2024 | December 31, 2023 | | :------------- | :------------- | :---------------- | | Raw materials | $28,812 | $33,345 | | Work in progress | $301 | $572 | | Finished goods | $312 | $312 | | Total inventory | $29,425 | $34,229 | - Total inventory decreased from **$34,229 thousand** at December 31, 2023, to **$29,425 thousand** at March 31, 2024, primarily driven by a reduction in raw materials[76](index=76&type=chunk) [4. Deposits and Other Current Assets](index=16&type=section&id=4.%20Deposits%20and%20Other%20Current%20Assets) This note details Faraday Future's deposits for R&D and goods, prepaid expenses, and other current assets as of March 31, 2024, and December 31, 2023 | (in thousands) | March 31, 2024 | December 31, 2023 | | :------------- | :------------- | :---------------- | | Deposits for R&D, prototype parts, and other | $24,364 | $28,609 | | Deposits for goods and services (Future Work) | $2,760 | $2,773 | | Total deposits | $27,124 | $31,382 | | Prepaid expenses | $16,595 | $13,309 | | Other current assets | $8,280 | $8,412 | | Total other current assets | $24,875 | $21,721 | - Total deposits decreased from **$31,382 thousand** to **$27,124 thousand**, while total other current assets increased from **$21,721 thousand** to **$24,875 thousand**[77](index=77&type=chunk) [5. Property, Plant and Equipment, Net](index=17&type=section&id=5.%20Property,%20Plant%20and%20Equipment,%20Net) This note presents Faraday Future's net property, plant, and equipment, including accumulated depreciation, as of March 31, 2024, and December 31, 2023 | (in thousands) | March 31, 2024 | December 31, 2023 | | :------------- | :------------- | :---------------- | | Total property, plant and equipment | $464,621 | $467,352 | | Less: Accumulated depreciation | $(67,189) | $(49,540) | | Total property, plant and equipment, net | $397,432 | $417,812 | - Net property, plant and equipment decreased from **$417,812 thousand** to **$397,432 thousand**, primarily due to increased accumulated depreciation[80](index=80&type=chunk) - Depreciation and amortization expense for Q1 2024 was **$17.8 million**, significantly higher than **$1.1 million** in Q1 2023[80](index=80&type=chunk) [6. Accrued Expenses and Other Current Liabilities](index=17&type=section&id=6.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) This note details Faraday Future's accrued payroll, legal contingencies, and other current liabilities as of March 31, 2024, and December 31, 2023 | (in thousands) | March 31, 2024 | December 31, 2023 | | :------------- | :------------- | :---------------- | | Accrued payroll and benefits | $27,263 | $28,037 | | Accrued legal contingencies | $20,804 | $21,590 | | Other current liabilities | $12,998 | $12,764 | | Total accrued expenses and other current liabilities | $61,065 | $62,391 | - Total accrued expenses and other current liabilities slightly decreased from **$62,391 thousand** to **$61,065 thousand**[82](index=82&type=chunk) [7. Notes Payable](index=18&type=section&id=7.%20Notes%20Payable) This note outlines Faraday Future's various notes payable, including secured, unsecured, and convertible notes, and their net carrying values as of March 31, 2024 | (in thousands) | March 31, 2024 Net Carrying Value | | :------------- | :-------------------------------- | | Secured SPA Notes | $41,888 | | Unsecured SPA Notes | $9,050 | | Unsecured Convertible Notes | $9,494 | | Notes payable – China other | $4,897 | | Auto loans | $72 | | Total Net Carrying Value | $65,401 | | Less: Related party notes payable | $(1,632) | | Less: Notes payable, current portion | $(63,769) | | Total: Notes payable, less current portion | $— | - The fair value of SPA Notes was **$50.9 million** and SPA Warrants was **$0.1 million** as of March 31, 2024, resulting in a **$28.3 million** gain in fair value for Q1 2024[114](index=114&type=chunk) - During Q1 2024, **$19.0 million** of SPA Notes principal (fair value **$9.1 million**) was converted to Class A Common Stock, leading to an **$11.6 million** loss on settlement[115](index=115&type=chunk) - The company issued **$9.1 million** in unsecured convertible notes in Q1 2024, which are due in three months and accrue **4.27%** interest, and subsequently defaulted on this debt[116](index=116&type=chunk)[117](index=117&type=chunk) [8. Related Party Transactions](index=23&type=section&id=8.%20Related%20Party%20Transactions) This note details Faraday Future's transactions with related parties, including notes payable, debt defaults, and consulting agreements, as of March 31, 2024 | (in thousands) | March 31, 2024 Net Carrying Value | | :------------- | :-------------------------------- | | Related party notes – China | $7,612 | | Related party notes – Unsecured Other Convertible | $1,632 | | Related party notes – China various other | $3,759 | | Related party notes – Convertible FFGP | $250 | | Related party notes – FFGP | $1,576 | | Total Net Carrying Value | $14,829 | | Less: Related party notes payable, current | $(14,829) | | Total: Related party notes payable, less current | $— | - The company recognized a **$14.1 million** loss on related party notes payable in Q1 2024 due to defaulting on a debt agreement with Chongqing Leshi Small Loan Co., Ltd., which reinstated full principal and accrued interest/penalties[132](index=132&type=chunk) - MHL, a related party, converted its remaining **$0.7 million** outstanding principal balance of Unsecured SPA Notes into Class A Common Stock in Q1 2024, resulting in a **$0.2 million** loss on settlement[128](index=128&type=chunk) - The Consulting Services Agreement with FF Global, a related party, automatically renewed in March 2024, requiring a monthly consulting fee of **$0.2 million**[141](index=141&type=chunk) [9. Commitments and Contingencies](index=27&type=section&id=9.%20Commitments%20and%20Contingencies) This note outlines Faraday Future's legal contingencies, settlement agreements, and total unconditional contractual commitments as of March 31, 2024 - Accrued legal contingencies were **$20.8 million** as of March 31, 2024, primarily for breach of contracts and employment matters[147](index=147&type=chunk) - The Zhou putative class action settlement for **$7.5 million**, funded by the company's insurers, received final court approval on March 18, 2024[150](index=150&type=chunk) - The company settled a dispute with Palantir Technologies Inc. for **$5.0 million**, but subsequently failed to make a settlement payment in June 2024, leading to amended arbitration demands[165](index=165&type=chunk) - Total unconditional contractual commitments are estimated at **$296.0 million** as of March 31, 2024, with **$102.1 million** due in 2024[193](index=193&type=chunk) [10. Stockholders' Equity](index=35&type=section&id=10.%20Stockholders'%20Equity) This note details Faraday Future's authorized and outstanding shares, changes in common stock, and warrant information as of March 31, 2024 | Stock Class | March 31, 2024 Authorized Shares | March 31, 2024 Issued and Outstanding Shares | | :---------- | :------------------------------- | :------------------------------------------- | | Preferred Stock | 10,000,000 | — | | Class A Common Stock | 443,625,000 | 159,390,384 | | Class B Common Stock | 19,687,500 | 266,670 | | Total | 473,312,500 | 159,657,054 | - Stockholders approved an increase in authorized Common Stock to **1,389,937,500 shares** on February 5, 2024, and a **1-for-3 reverse stock split** was effected on February 29, 2024, reducing authorized shares to **463,312,500**[201](index=201&type=chunk) - A Series A Preferred Stock was designated on June 21, 2024, granting **16 billion votes per share** for shareholder proposals (share authorization or reverse stock split) and a **$100** liquidation preference[202](index=202&type=chunk)[205](index=205&type=chunk) | Warrant Type | Number of Warrants (March 31, 2024) | Exercise Price | | :----------- | :---------------------------------- | :------------- | | Ares warrants | 9,139,280 | $0.73 | | SPA Warrants | 558,689 | $0.73 | | Public Warrants | 98,088 | $2,760 | | Private Warrants | 464 | $2,760 | | Total | 9,796,521 | | [11. Stock-Based Compensation](index=38&type=section&id=11.%20Stock-Based%20Compensation) This note details Faraday Future's stock-based compensation expense for Q1 2024, available shares under incentive plans, and RSU grants to executive officers - Stock-based compensation expense for Q1 2024 was **$542 thousand**, a significant decrease from **$8,633 thousand** in Q1 2023[220](index=220&type=chunk) - The 2021 SI Plan had **2,469,957 shares** of Class A Common Stock available for future issuance as of March 31, 2024[215](index=215&type=chunk) - The Incentive Plan Amendment, approved in August 2023, includes RSU grants to executive officers upon meeting delivery and share issuance conditions, with **$0.2 million** cash bonus expense recognized in Q1 2024[216](index=216&type=chunk)[217](index=217&type=chunk)[219](index=219&type=chunk) [12. Fair Value of Financial Instruments](index=39&type=section&id=12.%20Fair%20Value%20of%20Financial%20Instruments) This note explains Faraday Future's fair value measurements for financial instruments, including notes payable and warrant liabilities, using Level 3 valuations - The company measures certain notes payable and SPA Warrants at fair value using Level 3 valuations (binomial lattice and Monte Carlo simulation models), incorporating assumptions like stock volatility and debt discount rates[225](index=225&type=chunk)[227](index=227&type=chunk) March 31, 2024 Level 3 Fair Value (in thousands) | (in thousands) | March 31, 2024 Level 3 | | :------------- | :--------------------- | | Warrant liabilities | $103 | | Notes payable | $60,432 | Fair Value Changes (in thousands) | (in thousands) | Warrant Liabilities | Notes Payable | | :------------- | :------------------ | :------------ | | Balance as of December 31, 2023 | $306 | $86,712 | | Additions | $1 | $1,457 | | Change in fair value measurements | $(204) | $(28,113) | | Conversions of notes to Class A Common Stock | — | $(9,118) | | Balance as of March 31, 2024 | $103 | $50,938 | [13. Net Loss per Share](index=41&type=section&id=13.%20Net%20Loss%20per%20Share) This note presents Faraday Future's basic and diluted net loss per share for Class A and B Common Stock, and lists potentially dilutive shares excluded due to anti-dilution - Basic and diluted net loss per share for Class A and B Common Stock was **$(0.66)** for Q1 2024, compared to **$(48.22)** for Q1 2023[11](index=11&type=chunk) - All potentially dilutive common stock equivalents were anti-dilutive and excluded from diluted EPS calculation due to net losses[235](index=235&type=chunk) Potentially Dilutive Shares | Potentially Dilutive Shares | Three Months Ended March 31, 2024 | | :-------------------------- | :-------------------------------- | | Shares issuable upon conversion of SPA Notes and make-whole provisions | 93,243,053 | | Shares issuable upon conversion of Unsecured Convertible Notes | 15,624,025 | | Shares issuable upon exercise of SPA Warrants | 558,689 | | Other warrants | 9,139,280 | | Stock-based compensation awards – Options | 109,224 | | Stock-based compensation awards – RSUs | 857,530 | | Public warrants | 98,088 | | Private warrants | 464 | | Total | 119,630,353 | [14. Subsequent Events](index=42&type=section&id=14.%20Subsequent%20Events) This note discloses significant events occurring after March 31, 2024, including new convertible notes, SPA funding, stock conversions, and a lease financing arrangement - Subsequent to March 31, 2024, the company issued **$12.3 million** in unsecured convertible notes to a third party, with **$1.4 million** already in default due to non-payment[241](index=241&type=chunk) - The company received an additional **$6.5 million** in SPA Notes funding and converted **$15.4 million** principal and **$8.3 million** interest of SPA Notes into **282.7 million shares** of Class A Common Stock[242](index=242&type=chunk) - On July 11, 2024, the company entered into a **$4.9 million** lease financing arrangement for equipment with UTICA LEASECO, LLC, guaranteed by the company[243](index=243&type=chunk)[245](index=245&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=44&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on Faraday Future's financial condition and results of operations, detailing business model, product pipeline, and liquidity challenges [Overview](index=45&type=section&id=Overview) This section provides an overview of Faraday Future's business, including its intelligent electric vehicle design, manufacturing capabilities, key differentiators, and product pipeline - Faraday Future is a California-based, global, shared, intelligent, mobility ecosystem company founded in 2014, designing and engineering next-generation intelligent, connected, electric vehicles[255](index=255&type=chunk) - The company manufactures vehicles at its FF ieFactory California and has additional engineering, sales, and operational capabilities in China, exploring potential manufacturing capabilities there[255](index=255&type=chunk) - Key differentiators include its proprietary Variable Platform Architecture (VPA), advanced Internet Artificial Intelligence (I.A.I.) technology, and a portfolio of approximately **660 global patents**[256](index=256&type=chunk)[257](index=257&type=chunk) - The product pipeline includes the FF91 series (first deliveries in 2023), FF81 series, FF71 series, and a Smart Last Mile Delivery (SLMD) vehicle, all subject to future financing[258](index=258&type=chunk)[259](index=259&type=chunk)[261](index=261&type=chunk) - The company has updated its corporate strategy to include a China-U.S. Automotive Bridge Strategy, aiming to establish a second mass market-focused brand by partnering with China-based OEMs[262](index=262&type=chunk) [Recent Developments](index=47&type=section&id=Recent%20Developments) This section highlights Faraday Future's recent operational and strategic developments, including OTA upgrades, a new Master Plan, and changes in sales agreements - In Q1 2024, the company hosted a Chinese automotive supplier delegation, completed nearly **1,600 OTA upgrades** for the FF 91 2.0, and announced an updated Master Plan 1.1 for strategic growth[269](index=269&type=chunk) - Subsequent to Q1 2024, the company completed a voluntary recall via OTA software update, established a Middle Eastern sales entity in Dubai, and announced Werner Wilhelm as Executive Launch Director[270](index=270&type=chunk) - In June 2024, two previously announced FF 91 Alliance Edition users, Rem D Koolhaas and Emma Hernan, would not complete the acquisition of their respective FF cars due to personal reasons[270](index=270&type=chunk) [Recent Governance Developments](index=47&type=section&id=Recent%20Governance%20Developments) This section outlines Faraday Future's recent corporate governance changes, including stockholder approvals for stock adjustments, a reverse stock split, and executive/director resignations - On February 5, 2024, stockholders approved an increase in authorized Common Stock to **1,389,937,500 shares** and a **1-for-3 reverse stock split**, which was effected on February 29, 2024[271](index=271&type=chunk)[272](index=272&type=chunk) - The reverse stock split adjusted the number of shares reserved under incentive plans and the exercise prices of outstanding options, warrants, and convertible securities[274](index=274&type=chunk) - Mr. Xuefeng Chen transitioned from China CEO to Senior Vice President in February 2024 and resigned in March 2024; Ms. Li Han resigned as a director in June 2024[277](index=277&type=chunk) [Components of FF's Results of Operations](index=48&type=section&id=Components%20of%20FF's%20Results%20of%20Operations) This section describes the key components influencing Faraday Future's results of operations, including expected R&D, manufacturing, sales, and administrative expenses, and non-operating items - The company expects to incur significant operating costs for R&D, manufacturing expansion, production ramp-up, raw material procurement, and sales/marketing as it introduces new models and scales operations[279](index=279&type=chunk) - As of March 31, 2024, the company had sold **four** and leased **six** vehicles, indicating a need for substantial additional capital to fund operations and product development[280](index=280&type=chunk) - R&D expenses are expected to decrease as FF91 R&D activities were substantially completed in late 2023, while sales and marketing expenses are expected to increase as vehicles are brought to market[292](index=292&type=chunk)[293](index=293&type=chunk) - General and administrative expenses are expected to increase with business growth, and non-operating expenses include changes in fair value of notes/warrants, losses on debt settlement, and related party interest[294](index=294&type=chunk)[297](index=297&type=chunk)[298](index=298&type=chunk) [Results of Operations](index=52&type=section&id=Results%20of%20Operations) This section analyzes Faraday Future's financial performance for the three months ended March 31, 2024 and 2023, focusing on revenue, expenses, and net loss drivers | Metric (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 (As Restated) | Change Amount | Change % | | :-------------------- | :-------------------------------- | :---------------------------------------------- | :------------ | :------- | | Revenue | $2 | $— | $2 | NM* | | Cost of revenues | $20,687 | $— | $20,687 | NM* | | Research and development | $6,688 | $57,808 | $(51,120) | (88)% | | Sales and marketing | $2,474 | $5,065 | $(2,591) | (51)% | | General and administrative | $13,848 | $26,513 | $(12,665) | (48)% | | Loss from operations | $(43,608) | $(95,848) | $52,240 | (54)% | | Net loss | $(48,217) | $(144,973) | $96,756 | (67)% | - The significant decrease in R&D expense (**88% YoY**) was due to the substantial completion of FF91 R&D activities and cost-saving measures, including headcount reduction[303](index=303&type=chunk) - Loss on settlement of notes payable decreased by **88% YoY** to **$(11,403) thousand**, driven by lower conversion volume and a reduced loss per dollar of principal due to anti-dilution price protection[309](index=309&type=chunk) - Related party interest expense increased significantly to **$(5,094) thousand** due to the company's default on the Chongqing Leshi Small Loan Co., Ltd note, which reinstated higher interest rates and penalties[313](index=313&type=chunk) [Liquidity and Capital Resources](index=55&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses Faraday Future's liquidity and capital resources, highlighting going concern doubts, available funding, and the inaccessibility of its ATM Program - The company faces substantial doubt about its ability to continue as a going concern, with an accumulated deficit of **$4,006.7 million**, **$0.4 million** unrestricted cash, and a negative working capital of **$175.2 million** as of March 31, 2024[317](index=317&type=chunk) - Remaining funding from SPA Commitments is **$211.3 million**, and Optional Commitments is **$325.4 million**, both subject to various conditions and potential delays[318](index=318&type=chunk) - The ATM Program, a primary liquidity source, is currently inaccessible due to the company's non-compliance with SEC filing requirements (Form 10-K and 10-Q)[320](index=320&type=chunk) - The company is in default on SPA Commitments and in breach of a related party debt agreement, with an outstanding principal of **$7.6 million** and interest of **$17.4 million** as of March 31, 2024[324](index=324&type=chunk) [Cash Flow Analysis](index=58&type=section&id=Cash%20Flow%20Analysis) This section analyzes Faraday Future's cash flows from operating, investing, and financing activities for the three months ended March 31, 2024 and 2023 | (in thousands) | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :------------- | :-------------------------------- | :-------------------------------- | | Operating activities | $(14,719) | $(102,980) | | Investing activities | $(12) | $(16,873) | | Financing activities | $12,013 | $134,443 | - Net cash used in operating activities decreased significantly to **$14.7 million** in Q1 2024 from **$103.0 million** in Q1 2023, driven by a lower net loss and reduced losses on settlement of notes payable[333](index=333&type=chunk) - Net cash provided by financing activities decreased to **$12.0 million** in Q1 2024 from **$134.4 million** in Q1 2023, primarily from proceeds from notes payable and related party notes payable[335](index=335&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Faraday Future is exempt from providing quantitative and qualitative disclosures regarding market risk - The company is exempt from providing quantitative and qualitative disclosures about market risk as it qualifies as a 'smaller reporting company' under Item 305(e) of Regulation S-K[343](index=343&type=chunk) [Item 4. Controls and Procedures](index=59&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of disclosure controls and procedures, identifying material weaknesses in internal control over financial reporting and outlining remediation plans [Evaluation of Disclosure Controls and Procedures](index=59&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section concludes that Faraday Future's disclosure controls and procedures were ineffective as of March 31, 2024, due to identified material weaknesses - As of March 31, 2024, the company's disclosure controls and procedures were deemed ineffective due to identified material weaknesses in internal control over financial reporting[345](index=345&type=chunk) [Material Weaknesses in Internal Control Over Financial Reporting](index=59&type=section&id=Material%20Weaknesses%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section identifies specific material weaknesses in Faraday Future's internal control over financial reporting, including insufficient personnel, ineffective controls, and inadequate policies - Lack of sufficient professionals with appropriate accounting knowledge, training, and experience to timely and accurately analyze, record, and disclose accounting matters - Ineffective control environment, including insufficient segregation of duties in finance and accounting functions - Inadequate controls in response to risks of material misstatement, failing to adapt to business growth - Ineffective communication and information sharing between legal, capital markets, and accounting/finance departments, leading to incomplete transaction support - Failure to design and maintain effective controls for identifying and accounting for non-routine, unusual, or complex transactions (e.g., convertible notes, warrant liabilities, embedded derivatives) - Lack of formal accounting policies, procedures, and controls for complete, accurate, and timely financial accounting, reporting, and disclosures - Ineffective IT general controls for financial information systems, specifically regarding program change management, user access, and computer operations - Failure to maintain an effective control environment or demonstrate commitment to integrity and ethical values, resulting in inaccurate and incomplete disclosures of certain relationships and transactions - Ineffective controls related to the identification and disclosure of certain arrangements and transactions with related parties [Remediation Plan for Material Weaknesses in Internal Control Over Financial Reporting](index=60&type=section&id=Remediation%20Plan%20for%20Material%20Weaknesses%20in%20Internal%20Control%20Over%20Financial%20Reporting) This section outlines Faraday Future's plan to remediate identified material weaknesses, including personnel additions, policy development, and enhanced controls, with full remediation expected beyond 2024 - Adding finance and accounting personnel to strengthen teams and provide oversight - Developing new accounting policies and procedures and configuring IT systems to improve communication, structure, accountability, and segregation of duties - Implementing enhanced controls around related party transactions, including regular attestations, and adopting an Insider Investment Reporting Policy - Continuing to monitor segregation of responsibilities in user ecosystem, capital markets, human resources, administration, and FF China - Requiring Board or designated committee approval for financing agreements, hiring/promoting/terminating vice presidents, and adopting company-wide compensation policies - Reviewing the need for a Chief Compliance Officer and re-engaging external consulting resources for compliance and internal audit functions - Designing and implementing controls to identify and evaluate changes in business and their impact on internal controls, and for communicating information between departments - Developing formal processes, accounting policies, procedures, and controls for business processes and financial close, including balance sheet reconciliations and journal entry controls - Implementing IT general controls over change management, user access, critical batch jobs, and data backups - Full remediation is expected to extend beyond December 31, 2024, and will be time-consuming and costly, placing significant demands on financial and operational resources[361](index=361&type=chunk) [PART II. OTHER INFORMATION](index=63&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part provides additional information beyond the financial statements, covering legal proceedings, risk factors, equity sales, and other disclosures [Item 1. Legal Proceedings](index=63&type=section&id=Item%201.%20Legal%20Proceedings) This item refers to the detailed discussion of Faraday Future's legal proceedings, outlined in Note 9, which could materially impact the company's financial condition - The company is involved in various legal or governmental proceedings, the outcomes of which are uncertain but could have a material adverse effect on its business, financial condition, and results of operations[365](index=365&type=chunk) [Item 1A. Risk Factors](index=63&type=section&id=Item%201A.%20Risk%20Factors) This item updates previously disclosed risk factors, focusing on Nasdaq non-compliance, potential delisting, increased costs, supply chain disruptions, and the new 'Bridge Strategy' - **Nasdaq Delisting Risk:** The company is not in compliance with Nasdaq's minimum bid price, filing requirements (Form 10-K and 10-Q), and the Low Priced Stocks Rule, leading to a delisting determination. A hearing panel granted an extension until August 31, 2024, to regain compliance[366](index=366&type=chunk)[367](index=367&type=chunk)[368](index=368&type=chunk)[369](index=369&type=chunk)[372](index=372&type=chunk)[373](index=373&type=chunk)[374](index=374&type=chunk) - **Supply Chain and Cost Risks:** Increases in costs, supply disruptions, or shortages of materials (especially lithium-ion cells or electronic components) could harm the business. New tariffs, such as those announced by the Biden administration on Chinese EV batteries, could exacerbate these issues[376](index=376&type=chunk)[377](index=377&type=chunk) - **Bridge Strategy Risks:** The new China-U.S. Automotive Bridge Strategy faces numerous uncertainties, including insufficient demand for China-based EVs in the U.S., intense competition, lack of funding, existing tariff policies, high costs of building a new supply chain, and potential distraction from other business strategies[378](index=378&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=65&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This item details Faraday Future's unregistered sales of convertible notes to investors since December 31, 2023, and their potential conversion into Class A Common Stock, including anti-dilution provisions - Since December 31, 2023, the company sold approximately **$28.70 million** in principal amount of convertible notes (Secured SPA, Unsecured SPA, Unsecured Streeterville SPA, and Other Unsecured Notes) to investors under Section 4(a)(2) of the Securities Act[380](index=380&type=chunk) - Investors can purchase an additional **$530.1 million** in aggregate principal amount of convertible notes under these agreements[380](index=380&type=chunk) - As of July 30, 2024, the principal conversion price for these notes was **$0.7332 per share**, subject to full ratchet anti-dilution price protection, and the interest make-whole conversion price was **$10.896 per share**[381](index=381&type=chunk) [Item 3. Defaults Upon Senior Securities](index=65&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item confirms that there are no defaults upon senior securities to report for the period [Item 4. Mine Safety Disclosures](index=65&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item states that mine safety disclosures are not applicable to Faraday Future's operations [Item 5. Other Information](index=66&type=section&id=Item%205.%20Other%20Information) This item confirms that no director or officer entered into or terminated a 10b5-1 trading plan during Q1 2024 - No director or officer of the Company entered into or terminated a 10b5-1 or similar trading plan during the three months ended March 31, 2024[383](index=383&type=chunk) [Item 6. Exhibits](index=67&type=section&id=Item%206.%20Exhibits) This item lists the exhibits filed with the Form 10-Q, including corporate amendments, a settlement agreement, and officer certifications - Exhibit 3.1: Third Amended and Restated Certificate of Incorporation - Exhibit 3.2: Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation (February 7, 2024) - Exhibit 3.3: Second Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation (February 26, 2024) - Exhibit 10.1: Settlement Agreement with Palantir Technologies, Inc., dated March 11, 2024 - Exhibit 31.1 & 31.2: Certifications of Principal Executive Officer and Principal Financial Officer - Exhibit 32.1 & 32.2: Certifications of Principal Executive Officer pursuant to 18 U.S.C. Section 1350 [Signatures](index=68&type=section&id=Signatures) This section contains the signatures of the Global Chief Executive Officer and Interim Chief Financial Officer, certifying the report filing - The report is signed by Matthias Aydt, Global Chief Executive Officer (Principal Executive Officer), and Jonathan Maroko, Interim Chief Financial Officer (Principal Financial and Accounting Officer), on July 30, 2024[387](index=387&type=chunk)[388](index=388&type=chunk)

Core Viewpoint - Faraday Future Intelligent Electric (FFIE) has experienced a significant stock price surge, but the company's fundamentals suggest it is an early-stage EV startup with high risks and limited rewards [1][2]. Group 1: Company Performance - FFIE built approximately 15 vehicles in the previous year and sold only four, indicating a lack of production and sales momentum [1]. - The company currently holds around 300 non-binding, fully refundable preorders, which is minimal compared to Tesla's previous 10,000 reservations [7]. - Search volumes for "FFIE" have decreased by 86% since mid-May, reflecting waning interest [6]. Group 2: Market Sentiment and Investor Behavior - Despite the stock's recent rise, social media discussions around FFIE have turned negative, with no significant chatter about potential returns [7]. - The company lacks a prominent figure like Keith Gill from the GameStop saga to generate excitement and attract investors [7]. - Historical trends show that meme stocks can experience a "double peak," but FFIE's current trajectory suggests it may not sustain investor interest [2][3]. Group 3: Management and Public Perception - FFIE's management has been criticized for being publicity-shy, especially after the dismissal of co-founder Jia Yueting, who was previously a media-savvy figure [7]. - The company's brand recognition is low, with many consumers unable to identify its flagship FF91 SUV [7]. - The overall market perception of FFIE is that it is too small to make significant impacts, and its financial situation raises concerns about its viability as a going concern [8].

Financial Data and Key Metrics Changes - Faraday Future reported revenue of $0.8 million for fiscal year 2023, with a cost of goods sold of $43 million, compared to $0 revenue and $0 cost of goods sold in fiscal year 2022, indicating the start of vehicle deliveries in Q3 2023 [14] - Loss from operations decreased to $286 million in fiscal year 2023 from $437 million in fiscal year 2022, primarily due to a significant reduction in operating expenses [14] - Net loss decreased to $432 million for fiscal year 2023 compared to $602 million for fiscal year 2022, reflecting improved cost management [14][15] - Total assets increased slightly to $531 million as of December 31, 2023, from $529 million in 2022, while total liabilities decreased to $302 million from $328 million [15] - Cash balance at December 31, 2023, was $4 million, down from $17 million in 2022, indicating ongoing cash flow challenges [16] Business Line Data and Key Metrics Changes - The company transitioned from development to production, with significant milestones achieved in 2023, including the commencement of production for the FF 91 2.0 [5][6] - The FF 91 2.0 passed U.S. Federal Motor Vehicle Safety Standards crash test requirements, with the first phase of delivery beginning shortly thereafter [5] - A leasing program was launched, and a public charging program was rolled out to enhance sales and service capabilities [7] Market Data and Key Metrics Changes - The company announced potential entry into the Middle East market, which is part of its geographic expansion strategy alongside the U.S. and China [8] - Strategic cooperation agreements were established with local partners in the Middle East, indicating strong market interest [8] Company Strategy and Development Direction - The main focus for the company is to stabilize operations and achieve profitability as quickly as possible [24] - The company is considering a dual brand strategy to better target market segments and integrate advanced AI technology into more affordable products [24] - The U.S.-China automotive industry bridge strategy is being explored to leverage strengths from both markets [25][26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in funding and supply chain, which impacted production volumes [9] - The company is focused on building a direct relationship with users through co-creation initiatives, enhancing product development based on user feedback [9] - Management expressed confidence in the company's ability to ramp up production and improve financial stability with additional capital [22][27] Other Important Information - The company successfully raised approximately $300 million in gross financing through various means, including convertible notes and equity lines of credit [18] - Cost reductions have been implemented across the board, and the company is exploring non-dilutive financing options to improve its financial position [19][22] Q&A Session Summary - Questions regarding the company's future financing strategies and production ramp-up were addressed, with management emphasizing the importance of capital for scaling production [22] - Management reiterated the commitment to maintaining a lean operational structure while exploring additional funding opportunities [20][21]

Part I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) FFIE is a global intelligent mobility ecosystem company designing and manufacturing next-generation electric vehicles, with initial FF 91 deliveries starting in 2023 - FFIE is a Delaware holding company operating through U.S. (FF U.S.) and China (PRC Subsidiaries) entities, designing and engineering intelligent, connected, electric vehicles[9](index=9&type=chunk)[10](index=10&type=chunk)[12](index=12&type=chunk) - Key technological innovations include proprietary Variable Platform Architecture (VPA), propulsion system, and Internet, Autonomous Driving, and Intelligence (I.A.I.) systems[13](index=13&type=chunk) - The FF 91 Futurist was upgraded to PT Gen 2.0 in 2023 with **26 significant improvements**, and received its first major OTA upgrades in January 2024, consisting of **752 new additions** and **846 improvements**[14](index=14&type=chunk)[15](index=15&type=chunk) FF 91 Futurist Performance and IP | Metric | Value | | :--- | :--- | | Acceleration (0-60 mph) | 2.27 seconds | | EPA Range | 381 miles | | Patents Granted (as of Dec 31, 2023) | ~660 | | Horsepower (FF 91 Futurist) | 1,050 hp | | Torque (FF 91 Futurist) | 12,510 Nm | - FF's product pipeline includes the FF 91 series (flagship, MSRP **$309,000**), FF 81 series (premium mass market), FF 71 series (mass market), and a Smart Last Mile Delivery (SLMD) vehicle, with future models contingent on funding[16](index=16&type=chunk)[17](index=17&type=chunk)[100](index=100&type=chunk)[104](index=104&type=chunk)[107](index=107&type=chunk) - Manufacturing strategy is hybrid, utilizing a **1.1 million sq ft facility** in Hanford, California (**10,000 vehicles/year capacity**) and a contract manufacturing agreement with Myoung Shin in South Korea for the FF 81[19](index=19&type=chunk)[109](index=109&type=chunk)[110](index=110&type=chunk) - FF launched its **3-phase delivery plan** for the FF 91 in May 2023, with Phase 2 (revenue generation) beginning in August 2023, and is building a direct sales model with online and offline channels[20](index=20&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - The luxury car market (**$80,000+ MSRP**) is projected to grow at an **8-14% compound annual growth rate** through 2031, with electric vehicles expected to comprise over **75% of new passenger vehicle sales by 2040**[32](index=32&type=chunk)[33](index=33&type=chunk) - FF faces intense competition from both established and new EV manufacturers, many of whom possess greater financial, technical, and marketing resources[141](index=141&type=chunk)[142](index=142&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) FFIE faces severe liquidity constraints, substantial accumulated losses, and significant operational risks, including an SEC investigation and internal control weaknesses - FFIE has incurred cumulative losses of **$3,958.5 million**, has negative cash flows from operations, and an accumulated deficit as of December 31, 2023, raising substantial doubt about its ability to continue as a going concern[153](index=153&type=chunk)[545](index=545&type=chunk) Key Financial Risks (as of Dec 31, 2023) | Metric | Amount (USD) | | :--- | :--- | | Accumulated Deficit | $3,958.5 million | | Unrestricted Cash Balance | $1.9 million | | Negative Working Capital | $169.8 million | | Unfunded SPA Commitments | $211.3 million | | Optional Unfunded SPA Commitments | $327.0 million | - The company is in default on Secured SPA Notes and in breach of a debt agreement with Chongqing Leshi Small Loan Co., Ltd., and is currently ineligible to utilize its 'at-the-market' equity program due to late Form 10-K filing[154](index=154&type=chunk)[549](index=549&type=chunk)[552](index=552&type=chunk) - FFIE faces significant risks of Nasdaq delisting due to non-compliance with minimum bid price and timely filing requirements, which could severely impact its market price and ability to raise capital[405](index=405&type=chunk)[406](index=406&type=chunk)[407](index=407&type=chunk) - FFIE is involved in an SEC investigation and multiple legal proceedings (class action, derivative lawsuits), incurring significant expenses and potential adverse findings[199](index=199&type=chunk)[202](index=202&type=chunk)[204](index=204&type=chunk) - Material weaknesses in internal control over financial reporting have been identified, leading to a restatement of previously issued financial statements and ongoing remediation efforts expected to extend beyond December 31, 2024[393](index=393&type=chunk)[394](index=394&type=chunk)[399](index=399&type=chunk)[923](index=923&type=chunk)[924](index=924&type=chunk)[925](index=925&type=chunk)[926](index=926&type=chunk)[927](index=927&type=chunk)[928](index=928&type=chunk)[934](index=934&type=chunk) - Operations in China are subject to complex and rapidly evolving PRC laws and regulations, including those on foreign investment, cybersecurity, and data protection, posing risks of government intervention and operational changes[12](index=12&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk)[57](index=57&type=chunk)[58](index=58&type=chunk)[324](index=324&type=chunk)[325](index=325&type=chunk)[328](index=328&type=chunk)[332](index=332&type=chunk)[355](index=355&type=chunk)[356](index=356&type=chunk)[357](index=357&type=chunk)[361](index=361&type=chunk)[362](index=362&type=chunk)[363](index=363&type=chunk)[369](index=369&type=chunk)[370](index=370&type=chunk)[371](index=371&type=chunk)[373](index=373&type=chunk)[374](index=374&type=chunk)[375](index=375&type=chunk)[376](index=376&type=chunk)[377](index=377&type=chunk)[379](index=379&type=chunk)[380](index=380&type=chunk)[381](index=381&type=chunk) [Item 1B. Unresolved Staff Comments](index=85&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) There are no unresolved comments from the SEC staff regarding the company's previous filings - The company has no unresolved staff comments[459](index=459&type=chunk) [Item 1C. Cybersecurity](index=85&type=section&id=Item%201C.%20Cybersecurity) FFIE's cybersecurity strategy aligns with NIST frameworks, utilizing third-party vendors and annual penetration testing, with no material threats identified to date - FFIE's cybersecurity strategy aligns with the NIST Cybersecurity Framework (CSF) and Risk Management Framework (RMF), utilizing five core functions: Identify, Protect, Detect, Respond, and Recover[459](index=459&type=chunk) - The company partners with third-party vendors (Rapid7, Carbon Black, Cisco) for cybersecurity guidance and employs threat monitoring, detection, and SIEM tools[460](index=460&type=chunk)[461](index=461&type=chunk) - Annual penetration testing is performed by an independent third-party firm, and employees are required to take annual cybersecurity training[462](index=462&type=chunk) - No cybersecurity threats have been identified that have materially impaired or are reasonably likely to materially impair FFIE's operations or financial standing[461](index=461&type=chunk) [Item 2. Properties](index=85&type=section&id=Item%202.%20Properties) FFIE leases all its facilities, including its global headquarters and the Hanford manufacturing plant with a **10,000 vehicle/year capacity**, across California and China - FFIE leases all of its facilities, comprising five locations in California and three in China, used for manufacturing, retail, office, R&D, and strategic planning[463](index=463&type=chunk) Major Facilities (as of Dec 31, 2023) | Location | Approximate Size (sq ft) | Primary Use | Lease Expiration Date | | :--- | :--- | :--- | :--- | | Gardena, California | 146,765 | Global headquarters, R&D, office | April 30, 2027 | | FF ieFactory California | 1,100,000 | Manufacturing | October 19, 2028 | | Beverly Hills, California | 12,947 | Retail | August 31, 2032 | | Beijing, China | 13,993 | Administrative services, R&D, strategic planning | December 14, 2024 | | Shanghai, China | 2,799 | Administrative services, R&D, strategic planning | July 19, 2024 | | Shanghai, China | 9,074 | Administrative services, R&D, strategic planning | July 15, 2027 | - The FF ieFactory California manufacturing facility is approximately **1.1 million square feet** and, once fully built out, is expected to support a production capacity of **10,000 vehicles per year**[465](index=465&type=chunk) [Item 3. Legal Proceedings](index=86&type=section&id=Item%203.%20Legal%20Proceedings) FFIE is involved in various legal and governmental proceedings whose uncertain outcomes could materially impact its business, financial condition, and operations - FFIE is a party to various legal or governmental proceedings, the outcome of which is uncertain and could have a material adverse effect on its business, financial condition, and results of operations[466](index=466&type=chunk) [Item 4. Mine Safety Disclosures](index=86&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company is not required to provide disclosures related to mine safety - The company is not applicable for mine safety disclosures[467](index=467&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=87&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) FFIE's Class A Common Stock and Public Warrants are listed on Nasdaq, with no cash dividends paid or anticipated, and a significant number of shares reserved for equity compensation plans - FFIE's Class A Common Stock (FFIE) and Public Warrants (FFIEW) are listed on Nasdaq; there is no established public trading market for Class B Common Stock[469](index=469&type=chunk) - As of May 17, 2024, there were **439,674,662 shares** of Class A Common Stock and **266,670 shares** of Class B Common Stock issued and outstanding[5](index=5&type=chunk) - The company has not paid cash dividends and does not anticipate declaring any in the foreseeable future, intending to retain earnings for business operations[470](index=470&type=chunk) Equity Compensation Plan Information (as of Dec 31, 2023, adjusted for 1-for-3 split) | Plan Category | Securities to be Issued upon Exercise | Weighted Average Exercise Price | Securities Remaining Available for Future Issuance | | :--- | :--- | :--- | :--- | | Equity Compensation Plans Approved By Security holders: Faraday Future Intelligent Electric Inc. 2021 Incentive Plan | 147,232 | $107.82 | 1,067,189 | | Equity Compensation Plans Not Approved by Security Holders: Smart King Ltd. Equity Incentive Plan | 81,203 | $660.19 | — | | Equity Compensation Plans Not Approved by Security Holders: Smart King Ltd. Special Talent Incentive Plan | 22,551 | $1,505.15 | — | | **Total** | **250,986** | **$412.08** | **1,067,189** | [Item 6. Reserved](index=88&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=89&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) FFIE, an early-revenue stage company, generated **$0.8 million** in 2023 automotive sales but faces severe liquidity constraints, substantial operating losses, and an accumulated deficit of **$3,958.5 million**, raising going concern doubts - FFIE is a California-based global shared intelligent mobility ecosystem company, designing and engineering next-generation intelligent, connected, electric vehicles, with manufacturing in Hanford, California, and exploring contract manufacturing in South Korea and China[480](index=480&type=chunk)[481](index=481&type=chunk) - The company operates in a single operating and reportable segment, with its co-Chief Operating Decision Makers being the Global CEO and Chief Product and User Ecosystem Officer[489](index=489&type=chunk) - FFIE's Board reduced its size from seven to six members in October 2023, and approved a **1-for-3 reverse stock split** effective February 29, 2024, along with an increase in authorized shares[490](index=490&type=chunk)[492](index=492&type=chunk) - FFIE began production of the FF 91 Futurist in March 2023 and started customer deliveries in August 2023, recognizing **$0.8 million** in automotive sales revenue for the year ended December 31, 2023[501](index=501&type=chunk)[523](index=523&type=chunk) Consolidated Statements of Operations Highlights (Years Ended Dec 31, in thousands) | Metric | 2023 | 2022 | Change Amount | % Change | | :--- | :--- | :--- | :--- | :--- | | Auto sales revenue | $784 | $— | $784 | —% | | Cost of revenues | $42,607 | $— | $42,607 | —% | | Gross loss | $(41,823) | $— | $(41,823) | —% | | Research and development | $132,021 | $299,989 | $(167,968) | (56.0)% | | Sales and marketing | $22,836 | $21,689 | $1,147 | 5.3% | | General and administrative | $82,888 | $112,771 | $(29,883) | (26.5)% | | Loss from operations | $(286,054) | $(437,144) | $151,090 | (34.6)% | | Change in fair value of notes payable and warrant liabilities | $89,860 | $(70,512) | $160,372 | (227.4)% | | Loss on settlement of notes payable | $(217,019) | $(73,204) | $(143,815) | 196.5% | | Net loss | $(431,744) | $(602,239) | $170,495 | (28.3)% | - FFIE has substantial doubt about its ability to continue as a going concern due to recurring losses, negative cash flows, and an accumulated deficit of **$3,958.5 million** as of December 31, 2023[543](index=543&type=chunk)[545](index=545&type=chunk) - The company is unable to access its 'at-the-market' (ATM) equity program and Shelf Registration due to its failure to timely file the Form 10-K, significantly limiting its liquidity sources[548](index=548&type=chunk)[549](index=549&type=chunk) Cash Flow Summary (Years Ended Dec 31, in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(278,178) | $(383,058) | | Net cash used in investing activities | $(31,109) | $(123,222) | | Net cash provided by (used in) financing activities | $291,446 | $(6,721) | | Effect of exchange rate changes on cash and restricted cash | $3,352 | $1,038 | | Net (decrease) increase in cash and restricted cash | $(14,489) | $(511,963) | | Cash and restricted cash, end of period | $4,025 | $18,514 | [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=111&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a 'smaller reporting company,' Faraday Future is not required to provide quantitative and qualitative disclosures about market risk - FFIE is not required to provide quantitative and qualitative disclosures about market risk as it is a 'smaller reporting company'[587](index=587&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=112&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) FFIE's audited financial statements for 2023 and 2022 are presented, with the auditor's report highlighting 'going concern' uncertainty due to recurring losses and negative cash flows, alongside detailed notes and subsequent events - The independent auditor's report includes an explanatory paragraph stating that FFIE's recurring losses from operations and continued cash outflows raise substantial doubt about its ability to continue as a going concern[592](index=592&type=chunk) Consolidated Balance Sheet Highlights (as of Dec 31, in thousands) | Asset/Liability | 2023 | 2022 | | :--- | :--- | :--- | | Total current assets | $91,364 | $84,526 | | Property and equipment, net | $417,812 | $406,320 | | Total assets | $530,539 | $529,288 | | Total current liabilities | $261,176 | $268,245 | | Total liabilities | $302,303 | $328,296 | | Total stockholders' equity | $228,236 | $200,992 | Key Financial Data (Years Ended Dec 31, in thousands) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Net loss | $(431,744) | $(602,239) | | Basic Net loss per share (Class A and B) | $(44.81) | $(393.56) | | Weighted average common shares (Basic) | 9,634,759 | 1,530,227 | | Net cash used in operating activities | $(278,178) | $(383,058) | | Net cash provided by (used in) financing activities | $291,446 | $(6,721) | | Cash and restricted cash, end of period | $4,025 | $18,514 | - As of December 31, 2023, FFIE had an accumulated deficit of **$3,958.5 million**, **$1.9 million** in unrestricted cash, and a negative working capital position of **$169.8 million**[674](index=674&type=chunk) - FFIE is in default on its Secured SPA Notes and in breach of a debt agreement with Chongqing Leshi Small Loan Co., Ltd., with an outstanding principal balance of **$4.5 million** at an **18% interest rate** due to default[683](index=683&type=chunk)[755](index=755&type=chunk) - Subsequent events include the lapse of insurance coverage after December 31, 2023, the issuance of new unsecured notes (some in default), additional SPA funding of **$8.2 million**, and the conversion of **$34.4 million** principal and **$19.5 million** interest into **398.6 million** Class A Common Stock shares[910](index=910&type=chunk)[911](index=911&type=chunk)[912](index=912&type=chunk)[913](index=913&type=chunk)[914](index=914&type=chunk) - A **1-for-3 reverse stock split** was effected on February 29, 2024, reducing the number of issued and outstanding Common Stock shares and adjusting authorized shares to **463,312,500**[915](index=915&type=chunk)[916](index=916&type=chunk) [Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosures](index=175&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosures) There have been no changes in or disagreements with accountants on accounting and financial disclosures - There have been no changes in or disagreements with accountants on accounting and financial disclosures[920](index=920&type=chunk) [Item 9A. Controls and Procedures](index=175&type=section&id=Item%209A.%20Controls%20and%20Procedures) FFIE's disclosure controls and internal control over financial reporting were ineffective as of December 31, 2023, due to material weaknesses, with full remediation anticipated beyond December 31, 2024 - FFIE's disclosure controls and procedures and internal control over financial reporting were not effective as of December 31, 2023, due to identified material weaknesses[921](index=921&type=chunk)[922](index=922&type=chunk) - Material weaknesses include an ineffective control environment, insufficient controls for material misstatement risks, poor communication between departments, inadequate controls for complex transactions (e.g., convertible notes, warrants, sale leaseback), lack of formal accounting policies, ineffective IT general controls, and issues with integrity/ethical values and related party transaction identification[923](index=923&type=chunk)[924](index=924&type=chunk)[925](index=925&type=chunk)[926](index=926&type=chunk)[927](index=927&type=chunk)[928](index=928&type=chunk) - Management is actively engaged in a remediation plan, including hiring finance and accounting personnel, developing new policies and procedures, installing IT systems, and enhancing controls around related party transactions[929](index=929&type=chunk)[930](index=930&type=chunk)[931](index=931&type=chunk)[932](index=932&type=chunk)[933](index=933&type=chunk) - Full remediation of material weaknesses is expected to extend beyond December 31, 2024, and will be time-consuming and costly[934](index=934&type=chunk) - No changes in internal control over financial reporting materially affected the company's internal control during the three months ended December 31, 2023[936](index=936&type=chunk) [Item 9B. Other Information](index=178&type=section&id=Item%209B.%20Other%20Information) FFIE entered into a Consulting Services Agreement with FF Global for **$0.2 million** monthly, which automatically renewed in March 2024, and had no insider trading arrangements in 2023 and 2022 - FFIE entered into a Consulting Services Agreement with FF Global on March 6, 2023, effective February 1, 2023, for a monthly fee of **$0.2 million** plus expense reimbursements, covering strategic and operational assistance[937](index=937&type=chunk)[938](index=938&type=chunk) - The Consulting Services Agreement automatically renewed on March 6, 2024, for successive 12-month periods[937](index=937&type=chunk) - No Rule 10b5-1 or non-Rule 10b5-1 insider trading arrangements were adopted or terminated with officers or directors during 2023 and 2022[939](index=939&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=179&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) The company is not applicable for disclosures regarding foreign jurisdictions that prevent inspections - The company is not applicable for disclosures regarding foreign jurisdictions that prevent inspections[941](index=941&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance](index=180&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) FFIE's directors and executive officers are detailed, with the Audit Committee comprising independent financial experts, and FF Top holding director nomination rights, though some Section 16(A) reports were delinquent Executive Officers and Directors (as of May 17, 2024) | Name | Age | Position | | :--- | :--- | :--- | | Matthias Aydt | 67 | Global Chief Executive Officer and Director | | Yueting Jia | 50 | Chief Product and User Ecosystem Officer | | Jonathan Maroko | 39 | Interim Chief Financial Officer | | Scott Graziano | 53 | Global General Counsel | | Chui Tin Mok | 49 | Executive Vice President, Head of User Ecosystem | | Hong Rao | 52 | Vice President, I.A.I. | | Chad Chen | 41 | Director | | Li Han | 50 | Director | | Jie Sheng | 40 | Director | | Lev Peker | 42 | Director | - The Audit Committee comprises Lev Peker (Chair), Chad Chen, and Jie Sheng, all of whom are independent and qualify as 'audit committee financial experts'[962](index=962&type=chunk) - The Nominating and Governance Committee considers various qualifications for Board nominees, including achievements, skills, and ethical standards, with FF Top having specific rights to nominate directors[965](index=965&type=chunk)[966](index=966&type=chunk)[968](index=968&type=chunk) - FFIE has a Code of Ethics applicable to all employees, officers, and directors, available on its website[969](index=969&type=chunk) - Several directors and executive officers, including Rao Hong, Matthias Aydt, Lev Peker, Li Han, Chad Chen, and Jie Sheng, had delinquent Section 16(A) reports[970](index=970&type=chunk) [Item 11. Executive Compensation](index=183&type=section&id=Item%2011.%20Executive%20Compensation) FFIE's 2023 executive compensation included base salaries, bonuses, and equity awards, with salaries experiencing reductions, while non-employee directors received cash retainers and annual RSU awards - Named executive officers for 2023 included Matthias Aydt (Global CEO), Xuefeng Chen (former Global CEO), Jonathan Maroko (Interim CFO), Yun Han (former CAO/Interim CFO), Chui Tin Mok (EVP, Global Head of User Ecosystem), and YT Jia (Chief Product and User Ecosystem Officer)[971](index=971&type=chunk)[972](index=972&type=chunk) - Base salaries for named executive officers were subject to temporary reductions in October 2023 (to minimum wage of **$66,000**) and further reductions in December 2023 (**30-50% cuts**)[974](index=974&type=chunk)[979](index=979&type=chunk) Summary Compensation Table - Fiscal 2023 (in USD) | Name | Year | Salary | Bonus | Stock Awards | Option Awards | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Matthias Aydt | 2023 | $348,250 | $5,000 | $— | $— | $353,250 | | Matthias Aydt | 2022 | $383,333 | $— | $148 | $1,052 | $384,533 | | Xuefeng Chen | 2023 | $725,207 | $50,000 | $2,407 | $51,606 | $909,492 | | Xuefeng Chen | 2022 | $487,500 | $500,000 | $— | $— | $987,500 | | Jonathan Maroko | 2023 | $165,758 | $100,000 | $13,391 | $— | $279,149 | | Yun Han | 2023 | $390,000 | $325,000 | $— | $— | $715,000 | | Yun Han | 2022 | $73,976 | $200,000 | $4,983 | $— | $278,959 | | Chui Tin Mok | 2023 | $433,250 | $5,000 | $— | $— | $438,250 | | Chui Tin Mok | 2022 | $500,000 | $— | $185 | $115 | $500,300 | | YT Jia | 2023 | $390,750 | $50,000 | $— | $— | $440,750 | | YT Jia | 2022 | $397,900 | $— | $1,148 | $68,988 | $483,764 | - Non-employee directors receive an annual Board cash retainer of **$50,000**, additional retainers for committee roles, and an annual RSU award of **$150,000**[1008](index=1008&type=chunk)[1010](index=1010&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owner and Management and Related Stockholder Matters](index=192&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owner%20and%20Management%20and%20Related%20Stockholder%20Matters) Beneficial ownership of FFIE's Common Stock as of May 17, 2024, shows **439,674,662 Class A** and **266,670 Class B shares** outstanding, with individual and group executive/director ownership below **1%** - As of May 17, 2024, there were **439,674,662 shares** of Class A Common Stock and **266,670 shares** of Class B Common Stock outstanding[5](index=5&type=chunk)[1011](index=1011&type=chunk) Beneficial Ownership of Class A Common Stock (as of May 17, 2024) | Name | Number of Shares Beneficially Owned | Percentage of Class | | :--- | :--- | :--- | | Matthias Aydt | 2,450 | <1% | | Chad Chen | 15,389 | <1% | | Xuefeng Chen | 1,480 | <1% | | Yun Han | 3,228 | <1% | | Li Han | 14,719 | <1% | | Chui Tin Mok | 4,866 | <1% | | Jie Sheng | 15,134 | <1% | | Lev Peker | 10,125 | <1% | | Jonathan Maroko | 4,831 | <1% | | Yueting Jia | 4,777 | <1% | | All executive officers and directors as a group (12 individuals) | 79,620 | <1% | [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=193&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) FFIE's related party transactions include agreements with FF Top granting director nomination rights and borrowings from FF Global, all reviewed and approved by the Audit Committee - FFIE has an Amended and Restated Registration Rights Agreement with PSAC Sponsor, EarlyBirdCapital, FF Top, and Season Smart, granting them resale registration rights for Class A Common Stock[1020](index=1020&type=chunk) - Indemnification agreements are in place with directors and executive officers, requiring the company to indemnify them to the fullest extent permitted by Delaware law[1021](index=1021&type=chunk) - The Amended and Restated Shareholder Agreement with FF Top grants FF Top the right to nominate four directors, influence Board composition, and has provisions for voting power changes and Board expansion[1023](index=1023&type=chunk)[1024](index=1024&type=chunk)[1028](index=1028&type=chunk)[1029](index=1029&type=chunk)[1030](index=1030&type=chunk)[1031](index=1031&type=chunk) - FFIE has engaged in various related party transactions, including **$9.8 million** in related party notes payable as of December 31, 2023, and a Consulting Services Agreement with FF Global for **$0.2 million** monthly[1067](index=1067&type=chunk)[1078](index=1078&type=chunk)[1079](index=1079&type=chunk) - The Audit Committee is responsible for reviewing and approving all related person transactions, considering factors such as the related person's interest, material facts, impact on independence, and benefits to FFIE[1083](index=1083&type=chunk)[1084](index=1084&type=chunk) [Item 14. Principal Accounting Fees and Services](index=197&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Mazars USA LLP served as FFIE's independent auditor for 2022-2023, with audit fees increasing from **$557,000** to **$1,265,000**, and all services pre-approved by the Audit Committee - Mazars USA LLP served as FFIE's independent registered public accounting firm for the years ended December 31, 2022 and 2023[1085](index=1085&type=chunk) Audit Fees Billed by Mazars USA LLP | Year | Audit Fees | | :--- | :--- | | 2023 | $1,265,000 | | 2022 | $557,000 | - No audit-related, tax, or other fees were paid to Mazars for the years ended December 31, 2022 or 2023[1087](index=1087&type=chunk) - The Audit Committee has a policy for pre-approval of all audit and permitted non-audit services, and all services provided by Mazars in 2022 and 2023 were approved[1088](index=1088&type=chunk) PART IV [Item 15. Exhibits, Financial Statement Schedules](index=198&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists financial statements and exhibits filed with the Form 10-K, noting no separate schedules are required as information is integrated or insufficient, and details various agreements and corporate documents - The report includes consolidated financial statements as part of Item 8 and lists various exhibits in the Exhibit Index[1091](index=1091&type=chunk) - No separate financial statement schedules are required as the necessary information is either not present in sufficient amounts or is included in the consolidated financial statements[1091](index=1091&type=chunk) - The Exhibit Index details numerous documents, including merger agreements, corporate certificates, warrant agreements, registration rights agreements, shareholder agreements, employment agreements, and financial instrument details[1092](index=1092&type=chunk)[1093](index=1093&type=chunk)[1094](index=1094&type=chunk)[1095](index=1095&type=chunk)[1096](index=1096&type=chunk)[1097](index=1097&type=chunk)[1098](index=1098&type=chunk)[1099](index=1099&type=chunk)[1100](index=1100&type=chunk)[1101](index=1101&type=chunk)[1102](index=1102&type=chunk)[1103](index=1103&type=chunk)[1104](index=1104&type=chunk)[1105](index=1105&type=chunk)[1106](index=1106&type=chunk)[1107](index=1107&type=chunk)[1108](index=1108&type=chunk)[1109](index=1109&type=chunk)[1110](index=1110&type=chunk)[1111](index=1111&type=chunk)[1112](index=1112&type=chunk)[1113](index=1113&type=chunk)[1114](index=1114&type=chunk)[1115](index=1115&type=chunk)[1116](index=1116&type=chunk)[1117](index=1117&type=chunk)[1118](index=1118&type=chunk)[1119](index=1119&type=chunk)[1120](index=1120&type=chunk)[1121](index=1121&type=chunk)[1122](index=1122&type=chunk)[1123](index=1123&type=chunk)[1124](index=1124&type=chunk)[1125](index=1125&type=chunk)[1126](index=1126&type=chunk) [Item 16. Form 10-K Summary](index=198&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable and contains no summary content - This item is not applicable and contains no summary content[1091](index=1091&type=chunk) [Signatures](index=217&type=section&id=Signatures) The Form 10-K report was duly signed by FFIE's Global CEO, Interim CFO, and several directors on May 28, 2024 - The report is signed by Matthias Aydt (Global Chief Executive Officer), Jonathan Maroko (Interim Chief Financial Officer), and directors Chad Chen, Li Han, Chui Tin Mok, Lev Peker, and Jie Sheng[1128](index=1128&type=chunk)[1129](index=1129&type=chunk) - The signing date for the report is May 28, 2024[1128](index=1128&type=chunk)[1129](index=1129&type=chunk)

Business Highlights - Faraday Future delivered the first FF 91 2.0 Futurist Alliance to its first spire user and kicked off its August Developer Co-Creation Festival[41] - The FF 91 2.0 Futurist Alliance Track Edition set a record in its class at Willow Springs, achieving the fastest lap time of 1 minute and 35 seconds[44] - FF 91 2.0 Futurist Alliance broke the fastest lap record in the SUV and crossover categories at Button Willow Raceway Park[44] Financial Performance (Third Quarter 2023) - Auto sales revenue reached $551 thousand[60] - Cost of auto sales revenue was $16131 thousand, resulting in a gross loss of $15580 thousand[60] - Research and development expenses were $21593 thousand[60] - Sales and marketing expenses totaled $5318 thousand[60] - General and administrative expenses amounted to $24023 thousand[60] - Net loss was $78046 thousand, or $378 per share[60] Financial Position (September 30, 2023) - Cash was $6714 thousand and restricted cash was $1853 thousand, totaling $8567 thousand[61,63] - Total current assets were $127301 thousand, including $35215 thousand in inventory and $62556 thousand in deposits[61] - Total assets amounted to $579527 thousand[61] - Total liabilities were $317724 thousand[61] - Total stockholders' equity was $261803 thousand[61]