Faraday Future raised $25 million for its robotics pivot. The fine print tells a different story.
TL;DR
Faraday Future raised $25M in convertible notes for its robotics pivot. Half is locked in investor-controlled accounts.
Faraday Future announced on Thursday that it has raised $25 million through convertible promissory notes, bringing its total financing over the past two months to $70 million. The company says the capital is sufficient to fund Phase 1 of its robotics business plan through the end of 2026. The stock, which trades on Nasdaq under the ticker FFAI, closed below $1 per share and is currently under a Nasdaq deficiency notice for failing to maintain the minimum bid price requirement.
The structure of the raise warrants attention. Of the $25 million, only $12.5 million goes directly into the company’s operating account. The remaining $12.5 million is deposited into control accounts held by the investors, and will be released to Faraday Future only upon satisfaction of certain undisclosed conditions. The press release describes...
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