Faraday future was supposed to meet with a Middle East sovereign wealth fund to discuss an investment that could have helped pull the struggling EV startup out of its perpetual financial nosedive. The wealth fund retracted the invite shortly after Faraday future founder Jia Yueting filed for bankruptcy to resolve billions of dollars of personal debt.
Jia’s lawyer told a judge in December 2019 that he was invited to go to the Middle East to a sovereign fund.’Faraday was uninvited,’ his lawyer said.
The lawyer for Jia who spoke during the hearing did not specify which Middle Eastern sovereign wealth fund was interested. Faraday future’s communications director John Schilling declined to comment.
The Middle East’s interest in Faraday future is just one of a number of revelations to surface during Jia’s bankruptcy process.
Faraday future has insisted that investors or partners will line up once the drama and Jia’s bankruptcy subsided. Jia told his many creditors in April that this was finally happening.
The legal team told the creditors that Faraday future is’in close communication with two major OEMs in China about partnership’.
Electric vehicle startups are also a hot target for investment deals. rivian is continuing to raise an incredible amount of money. Fisker Inc. lining up a similar route to go public.
The nature and extent of the discussions are all confidential so I can not share any further details,’ Schilling said. Schilling said he will confirm that we are in discussions with various organizations as Faraday future continues to progress towards the delivery of the ff91.
Carsten breitfeld was replaced by Carsten breitfeld last September. Jia stepped down as CEO of China’s byton startup in September. breitfeld is a former BMW executive.
breitfeld told the verge last year that he would only come to Faraday future if he was made CEO. But he now lives in one of the multimillion-dollar homes owned by Jia’s associates, according to the bankruptcy case.
Jia has used these mansions to house past Faraday future executives, host parties, and take loans against when money is tight. But breitfeld recently tweeted an image from outside a $ 2 million home about a mile inland that’s owned by Faraday future vice president Chaoying Deng.
In an email, Schilling said breitfeld is living in a’rented property’ that is rented by FF and offered to executives for their stay as part of their relocation benefits.
breitfeld had previously lived in Silicon Valley and frequently traveled to Germany and China while working with byton. He told the verge last year that he moved to Los Angeles for the Faraday future job job job.
I burned all the bridges to the past. I just moved here with my son, and now I’m here,’ he said.’Silicon Valley, if you like technology, you meet a lot of technology people and that’s very exciting. But the life, is boring. Here you’re very close to the sea which I love very much’.
Faraday future split from a main investor, China’s Evergrande, in 2018. That split led to hundreds of layoffs and furloughs. Faraday future sold its own headquarters in 2019 to generate some cash.
Jia’s bankruptcy was funded by one of the main holding companies of Faraday future, a Delaware LLC called Pacific technology. He borrowed $ 2.7 million from Pacific technology at the beginning of the process, and took on a $ 6.4 million’debtor in possession’ loan as the case wound up.
Jia’s lawyers originally said this was because the Faraday future affiliate offered the most forgiving terms. Other lenders wanted better protections or more returns on any loans provided to a man who has billions of dollars of personal debt.
Jia’s lawyers claim this was all above board. The creditor committee – a group made up of representatives of some of the companies that are owed money in the bankruptcy – helped negotiate the terms.
Loans were largely made up of individual contributions from the members of Faraday future’s’global partners’ management team of executives.
Jia says he no longer owns a stake in the mansions, but ocean view drive now leases them to a company called warm Time Inc. for $ 43,810 per month in 2019. The company has since turned around and leased them to Faraday future’on a full service basis, including hospitality services (i.e. food service, housekeeping, insurance, and utilities’.
Jack Butler’s firm birch lake has extended multiple loans to the startup as it searched for funding. In early 2019 it started working with’bankruptcy legend’ Jack Butler.
Faraday future had to ask birch lake for an extension on a $ 45 million loan that was due in October 2019. The startup is at risk of losing its assets if it ca n’t make good on the debt it’s been carrying.
Birch lake has released its hold on the intellectual property according to filings with California’s secretary of state and the US patent and Trademark office. The interest in the collateral Faraday future pledged for the loan has since been transferred to a California LLC called’kaiod’.
Faraday future had just $ 6.8 million in cash at the end of July 2019. The startup also received a $ 9.1 million loan from the covid-19-related paycheck protection program in April.
Faraday future needs $ 850 million in order to get to production. In the near term, the startup has been trying to secure a $ 170 million loan.