The Founder and CPUO of Faraday Future, Yueting Jia(YT), has filed for bankruptcy and restructuring under Chapter 11 in the United States, this was done to address his personal debts in China. In connection with the filing, a ‘creditor trust’ for the benefit of YT’s creditors is planned to be established, which will be jointly managed by a committee of creditors and the trustee. YT plans to transfer all his existing equity interest in Smart King Limited, the global holding company for Faraday Future, to the creditor trust to better protect his creditors and repay his debt.
This matter will not affect any of FF’s normal business operations. The Plan will in fact have multiple benefits for FF in the following ways:
- This Plan provides YT an opportunity to address his personal debts, help facilitate FF’s equity financing efforts and prepare for an IPO, and further advance the implementation of FF’s US-China dual home market strategy.
- YT will continue to be involved with the FF team to complete its strategic goals in the capacity of FF's founder and Chief Product & User Officer (CPUO) and to maximize the value of FF and the assets in the creditor trust. The Plan benefits all stakeholders.
- This filing for restructuring will not affect the ownership of employee stock options or shares in FF acquired upon exercise of employee stock options. Employee stock options will remain an effective tool to help FF continuously assist in the recruitment of future talent.