The rocky road that Faraday Future (FFIE 23.29%) has been traveling just became a little smoother. The electric vehicle company just announced it has reach a resolution regarding a dispute with major shareholders. Furthermore, it also secured $100 million in critical financing.
As of 10:33 a.m. ET, shares of Faraday Future were racing 28.3% higher.
Addressing some key points of contention with one of its major shareholders, FF Top Holding, Faraday affirmed today that it has entered into a binding governance agreement that “resolves a range of issues concerning governance.” In addition to FF Top ending litigation — which it announced last week — that it had brought against the EV maker, the agreement will have Faraday make changes to the size and membership of the company’s board of directors.
Faraday also announced two financing agreements that will provide much-needed capital for the EV start-up. In one agreement, Faraday will receive $40 million in exchange for convertible secured notes and warrant exercise payments. The other agreement will have the company receive $60 million from Senyun International in the form of convertible secured notes.
While the $100 million in funding that Faraday has received provides a desperately needed influx of capital, the company’s future remains far from certain. Besides the announcement of the two financing deals, Faraday stated that it continues to seek financing to keep the lights on for the remainder of 2022.
Investors who are wondering whether now’s the time to hitch a ride with the EV company should weigh the risks carefully and dig deeper before following the market’s enthusiasm today.