Written by Cláudio Afonso | LinkedIn | X
Faraday Future announced Friday its entry into a $4.9 million lease financing arrangement with Utica Leaseco, according to the SEC filing.
The agreement aims to support the EV maker’s operational and production capabilities. Year to date, the company has delivered only one vehicle as it seeks more funding in the Middle East region.
Utica will lease various machinery, vehicles, and equipment to Faraday Future over the next four years with the US-based startup making 51 monthly payments of $146,510.
At the end of the term, the company has the option to buy out the lease for $490,000 under specified conditions, according to the filing.
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The lease arrangement includes several key provisions, such as granting Utica a first priority security interest in the leased equipment. Additionally, the agreement allows Faraday Future to terminate the lease after the 19th month, subject to specific conditions and fees.
In conjunction with the agreement, the EV startup also entered into a Post-Closing Agreement where it agreed to grant Utica rent-free access to its Hanford and Gardena locations for 120 days in the event of a default.
Additionally, the EV maker made substantial prepayments totaling $1,605,000, which includes $100,000 for the Hanford location and $1,435,000 for the Gardena location, along with an extra $70,000 under the Master Lease.
Last week, the company said its Annual Meeting of Stockholders will be held on July 31 as it seeks approval on the reverse stock split that would allow the stock price to trade above Nasdaq’s $1 threshold.
Among the proposals facing shareholders’ vote in the upcoming Annual meeting, the most significant is the approval of a reverse stock split for the common stock, with a ratio ranging from 1-for-2 to 1-for-40. If approved, the ratio will be defined by the company’s Board of Directors.
In a new video shared on Thursday, FF’s founder YT Jia commented on the EV market comparing China, the United States and Europe while stating that Tesla leads the U.S. EV market.
“Tesla is the only dominant player in the US EV market, and a flourishing development of the industry is far from being formed,” Jia said in a video statement.
Here’s the full video.
FF’s Founder and the current Chief Product & User Ecosystem Officer highlighted the difference between Chinese EVs on AI-powered EVs.
“The Chinese AI EV industry has entered the elimination and the consolidation stage but the preliminary round in the United States has not even begun,” he said before further commenting the U.S. market.
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“Although the U.S. government has provided some incentives, such as tax credits and subsidies, the strength and coverage of these policies are not, in my opinion, enough to promote large-scale industry upgrading,” YT Jia stated.
The executive defends that the U.S. has still a long way to go when it comes to the policy support on promoting the EV infrastructure, “Comparing with Europe and China, the U.S. lags behind in policy support promoting EV infrastructure construction and technology research and development”.
The stock started the year at about $0.68, went south to just below $0.04 in late April before soaring 9,500 percent in 18 trading days to $3.90 amid the comeback of one of the world’s famous trader Keith Gill, known as “Roaring Kitty,” who previously drove meme stocks to remarkable highs in 2021.
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Written by Cláudio Afonso | LinkedIn | X
