What changed in this filing

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Item 1. Financial Statements

2025-05-09 compared with 2024-11-08 · 1118 added, 1112 removed, 509 unchanged (81% of the section changed)

1 unchanged sentence

Faraday Future Intelligent Electric Inc.

Condensed Consolidated Balance Sheets

Unaudited Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

September 30, 2024

(Unaudited) December 31, 2023

March 31, 2025 December 31, 2024

Current assets

6 unchanged sentences

Total current assets 76,471 71,881

79,685 91,364

Property, plant and equipment, net 331,465 348,587

2 unchanged sentences

Total assets $ 410,584 $ 425,400

$ 449,086 $ 530,539

Liabilities and stockholders’ equity

2 unchanged sentences

Accrued expenses and other current liabilities 50,388 45,677

Related party accrued expenses and other current liabilities 11,104 11,077

Warrant liabilities 22,498 28,864

2 unchanged sentences

Related party accrued interest 22,343 23,227

Other financing liabilities, current portion 803 761

Operating lease liabilities, current portion 1,364 2,128

2 unchanged sentences

Total current liabilities 188,778 192,707

247,882 261,176

Financial obligations on lease back transaction 27,459 25,483

Operating lease liabilities, less current portion 11,760 14,306

Notes payable, less current portion 3,800 —

Other financing liabilities, long term portion 40,489 38,698

Operating lease liabilities, long term portion 10 14

Notes payable, long term portion 20,542 45,264

Related party notes payable, long term portion 2,825 2,754

Derivative call options 16,064 29,709

Related party derivative call options 993 —

Other liabilities 1,075 1,287

Total liabilities 270,776 310,433

292,330 302,303

Commitments and contingencies (see Note 10)

Stockholders’ equity

1 unchanged sentence

124,815,625 and 99,815,625 shares authorized;

30,713,729 and 1,060,826 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

86,786,748 and 65,919,127 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

Class B Common Stock, 0.0001 par value;

4,429,688 and 54,688 shares authorized;

6,667 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively

Preferred Stock, $ 0.0001 par value, 10,000,000 shares authorized, zero shares issued and outstanding as of September 30, 2024 and December 31, 2023

4,429,688 shares authorized;

6,667 shares issued and outstanding as of March 31, 2025 and December 31, 2024

Preferred Stock, 0.0001 par value;

10,000,000 shares authorized;

zero and one shares issued and outstanding as of March 31, 2025 and December 31, 2024 respectively

Additional paid-in capital 4,456,374 4,421,563

2 unchanged sentences

Total stockholders’ equity 139,808 114,967

156,756 228,236

Total liabilities and stockholders’ equity $ 410,584 $ 425,400

$ 449,086 $ 530,539

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

2 unchanged sentences

(in thousands, except share and per share data)

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Revenue $ 316 $ 2

Cost of revenues 21,453 16,131 63,110 22,744

Cost of revenue 21,381 20,687

Gross profit ( 21,065 ) ( 20,685 )

3 unchanged sentences

General and administrative 13,674 13,848

Settlement on accrued research and development expenses ( 14,935 ) — ( 14,935 ) —

Lease impairment loss 57 — 7,673 —

Loss on disposal on property, plant and equipment 2,582 — 2,511 3,698

Change in fair value of earnout liability — ( 67 ) — 2,033

Loss (gain) on disposal on property, plant, and equipment 44 ( 87 )

Total operating expenses 22,766 22,923

Loss from operations ( 43,831 ) ( 43,608 )

Change in fair value of notes payable and warrant liabilities 8,287 17,571 28,927 90,030

Change in fair value of related party notes payable and related party warrant liabilities 654 4,726 315 5,110

Change in fair value of notes payable, warrant liabilities, and derivative call options 51,458 27,885

Change in fair value of related party notes payable, warrant liabilities, and derivative call options ( 277 ) ( 7 )

Loss on settlement of notes payable ( 15,920 ) ( 11,403 )

Loss on related party notes payable — ( 10,756 ) ( 14,295 ) ( 17,248 )

Loss on settlement of related party notes payable ( 1,180 ) ( 14,295 )

Interest expense ( 2,302 ) ( 2,225 )

Related party interest expense — ( 5,094 )

Other income/(expense), net 361 ( 1,624 ) 599 ( 1,922 )

Other income, net 1,784 530

Loss before income taxes ( 10,268 ) ( 48,217 )

Income tax provision 1 — ( 3 ) ( 28 )

Income tax expense ( 10 ) —

Net loss $ ( 10,278 ) $ ( 48,217 )

Per share information (See Note 15):

Net loss per share of Class A and B Common Stock attributable to common stockholders:

1 unchanged sentence

Diluted $ ( 0.14 ) $ ( 26.23 )

Weighted average shares used in computing net loss per share of Class A and B Common Stock:

Weighted average common shares used in computing net loss per share of Class A and Class B Common Stock:

Basic 75,749,893 1,837,959

5 unchanged sentences

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

Faraday Future Intelligent Electric Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

(in thousands, except share data)

Common Stock Additional

Capital Accumulated

Comprehensive

Income Accumulated Deficit Total Stockholders’ Equity

Class A Class B

Shares Amount Shares Amount

Balance as of June 30, 2024

11,031,625 $ 1 6,667 $ — $ 4,257,356 $ 6,726 $ ( 4,115,401 ) $ 148,682

Conversion of notes payable and accrued interest into Class A Common Stock (see Note 7) 19,107,321 2 — — 84,079 — — 84,081

Reclassification of SPA Warrants from liability to equity — — — — 160 — — 160

Issuance of common stock and warrants — — — — 10 — — 10

Settlement of Palantir dispute with issuance of Class A Common Stock (see Note 10) 252,768 — — — 2,400 — — 2,400

Purchase of Class A Common Stock under Salary Deduction and Stock Purchase Agreements (see Note 11) 10,455 — — — 36 — — 36

Reverse Stock split related round up share issuances 306,472 — — — — — — —

Stock-based compensation — — — — 1,593 — — 1,593

Issuance of shares for RSU vesting net of tax withholdings 5,088 — — — ( 10 ) — — ( 10 )

Foreign currency translation adjustment — — — — — ( 2,510 ) — ( 2,510 )

Net loss — — — — — — ( 77,686 ) ( 77,686 )

Balance as of September 30, 2024

30,713,729 $ 3 6,667 $ — $ 4,345,624 $ 4,216 $ ( 4,193,087 ) $ 156,756

See accompanying notes to Unaudited Condensed Consolidated Financial Statements.

Faraday Future Intelligent Electric Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Continued)

Faraday Faraday Future Intelligent Electric Inc.

Unaudited Condensed Consolidated Statement of Stockholders’ Equity

(in thousands, except share data)

1 unchanged sentence

Capital Accumulated

Comprehensive Income Accumulated Deficit Total Stockholders’ Equity

Comprehensive Income (Loss) Accumulated

Deficit Total Stockholder’s

Class A Class B

1 unchanged sentence

Balance as of December 31, 2024 65,919,127 $ 6 6,667 $ — $ 4,421,563 $ 7,744 $ ( 4,314,346 ) $ 114,967

1,060,833 $ — 6,667 $ — $ 4,180,873 $ 5,862 $ ( 3,958,499 ) $ 228,236

Conversion of notes payable and accrued interest into Class A Common Stock (see Note 7) 29,077,806 3 — — 159,903 — — 159,906

Reclassification of SPA Warrants from liability to equity — — — — 160 — — 160

Issuance of common stock and warrants — — — — 10 — — 10

Settlement of Palantir dispute with issuance of Class A Common Stock (see Note 10) 252,768 — — — 2,400 — — 2,400

Purchase of Class A Common Stock under Salary Deduction and Stock Purchase Agreements (see Note 11) 10,455 — — — 36 — — 36

Reverse stock split related round up share issuances 306,779 — — — — — — —

Conversion of notes payable and accrued interest into Class A Common Stock ( Note 7) 20,081,506 2 — — 32,671 — — 32,673

Settlement of HSL s.r.l.

lawsuit with issuance of Class A Common Stock (Note 11) 774,183 — — — 1,185 — — 1,185

Stock-based compensation — — — — 301 — — 301

Issuance of shares for RSU vesting net of tax withholdings 11,932 — — — — — — —

Chongqing related party debt restructuring (Note 8) — — — — 654 — — 654

Foreign currency translation adjustment — — — — — 306 — 306

Net loss — — — — — — ( 10,278 ) ( 10,278 )

Balance as of September 30, 2024

30,713,729 $ 3 6,667 $ — $ 4,345,624 $ 4,216 $ ( 4,193,087 ) $ 156,756

Balance as of March 31, 2025 86,786,748 $ 8 6,667 $ — $ 4,456,374 $ 8,050 $ ( 4,324,624 ) $ 139,808

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

Faraday Future Intelligent Electric Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Continued)

(in thousands, except share data)

Common Stock Additional

1 unchanged sentence

Comprehensive

Income Accumulated Deficit Total Stockholders’ Equity

Class A Class B

Shares Amount Shares Amount

Balance as of June 30, 2023

148,310 $ — 6,667 $ — $ 4,065,284 $ 9,072 $ ( 3,796,656 ) $ 277,700

Conversion of notes payable and accrued interest into Class A Common Stock (See Note 7) 101,518 — — — 51,907 — — 51,907

Reclassification of earnout shares from liability to equity on August 25, 2023 due to authorized share increase (see Note 11) — — — — 1,381 — — 1,381

Reclassification of stock-based awards from liability to equity on August 25, 2023 due to authorized share increase (see Note 11) — — — — 2,043 — — 2,043

Issuance of common stock 13,480 — — — 8,520 — — 8,520

Reverse stock split related round up share issuances 1,366 — — — — — — —

Stock-based compensation — — — — 216 — — 216

Issuance of shares for RSU vesting net of tax withholdings 32 — — — ( 358 ) — — ( 358 )

Cancellations — — — — — — — —

Foreign currency translation adjustment — — — — — ( 1,560 ) — ( 1,560 )

Net loss — — — — — — ( 78,046 ) ( 78,046 )

Balance as of September 30, 2023

264,706 $ — 6,667 $ — $ 4,128,993 $ 7,512 $ ( 3,874,702 ) $ 261,803

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

Faraday Future Intelligent Electric Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity (Continued)

(in thousands, except share data)

Common Stock Additional

Capital Accumulated

Comprehensive Income Accumulated Deficit Total Stockholders’ Equity

Income (Loss) Accumulated Deficit Total Stockholders’ Equity

Class A Class B

Shares Amount Shares Amount

Balance as of December 31, 2022 (as restated)

58,682 $ — 6,667 $ — $ 3,724,242 $ 3,505 $ ( 3,526,755 ) $ 200,992

Balance as of December 31, 2023 1,060,833 $ — 6,667 $ — $ 4,180,873 $ 5,862 $ ( 3,958,499 ) $ 228,236

Conversion of notes payable and accrued interest into Class A Common Stock (see Note 7) 2,923,628 — — — 20,726 — — 20,726

Change in classification of warrants from Additional paid-in capital to liability pursuant to the Warrant Exchange (see Note 7) — — — — ( 6,811 ) — — ( 6,811 )

Reclassification of earnout shares from liability to equity on February 28, 2023 due to authorized share increase (see Note 11) — — — — 5,014 — — 5,014

Reclassification of stock-based awards from liability to equity on February 28, 2023 due to authorized share increase (see Note 11) — — — — 8,978 — — 8,978

Reclassification of earnout shares from equity to liability on April 21, 2023 due to insufficient authorized shares (see Note 11) — — — — ( 2,112 ) — — ( 2,112 )

Reclassification of stock-based awards from equity to liability on April 21, 2023 due to insufficient authorized shares (see Note 11) — — — — ( 2,979 ) — — ( 2,979 )

Reclassification of earnout shares from liability to equity on August 25, 2023 due to authorized share increase (see Note 11) — — — — 1,381 — — 1,381

Reclassification of stock-based awards from liability to equity on August 25, 2023 due to authorized share increase (see Note 11) — — — — 2,043 — — 2,043

Issuance of common stock 13,480 — — — 8,520 — — 8,520

Reverse stock split related round up share issuances 307 — — — — — — —

Stock-based compensation — — — — 542 — — 542

Exercise of warrants 5,326 — — — 51,276 — — 51,276

Exercise of stock options 6 — — — 44 — — 44

Issuance of shares for RSU vesting net of tax withholdings 271 — — — ( 458 ) — — ( 458 )

Cancellations ( 26 ) — — — — — — —

Foreign currency translation adjustment — — — — — 232 — 232

Net loss — — — — — — ( 48,217 ) ( 48,217 )

Balance as of September 30, 2023

264,706 $ — 6,667 $ — $ 4,128,993 $ 7,512 $ ( 3,874,702 ) $ 261,803

Balance as of March 31, 2024 3,984,768 $ — 6,667 $ — $ 4,202,141 $ 6,094 $ ( 4,006,716 ) $ 201,519

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements

2 unchanged sentences

(in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities

2 unchanged sentences

Depreciation and amortization expense 17,527 17,728

Amortization of operating lease right-of-use assets and intangible assets 553 749

Non-cash interest expense 814 —

Stock-based compensation 301 542

Lease impairment loss 7,673 —

Loss on disposal of property, plant and equipment 2,511 3,698

Loss (gain) on disposal of property and equipment 44 ( 87 )

Loss from settlement of notes payable 15,920 11,403

Loss from settlement of related party notes payable 1,180 14,295

Gain from forgiveness of accounts payable and deposits, net — ( 518 )

settlement adjustment ( 295 ) —

Gain on foreign exchange — ( 2,105 )

Change in fair value of notes payable, warrant liabilities, and derivative call options ( 51,458 ) ( 27,885 )

Change in fair value of related party notes payable and related party warrant liabilities 277 7

Change in fair value of notes payable and warrant liabilities ( 28,927 ) ( 90,461 )

Change in fair value measurement of earnout liability — 1,381

Amortization of operating lease right-of-use asset 1,947 2,491

Loss on foreign exchange ( 40 ) 218

Non-cash interest expense 2,030 —

Loss on settlement of notes payable 117,509 204,885

Loss on related party notes payable 14,295 17,248

Settlement on accrued research and development expenses ( 14,935 ) —

Other 366 1,416

Changes in operating assets and liabilities:

Accounts receivables ( 664 ) —

Deposits ( 2,823 ) 5,955

2 unchanged sentences

Accounts payable ( 651 ) 3,559

Financial obligations on sale and lease back transaction 1,976 —

Accrued expenses and other current liabilities 3,612 ( 23,332 )

Accrued expenses and other current and non-current liabilities 6,945 1,749

Related party accrued expenses and other current and non-current liabilities 139 —

Accrued interest expense — 5,114

Financial obligations on lease back transaction — 751

Operating lease liabilities ( 703 ) ( 755 )

Accrued related party interest expense 7,544 ( 26 )

Net cash used in operating activities ( 20,295 ) ( 14,719 )

Cash flows from investing activities

Proceeds from sale of equipment 87 —

Purchase of property, plant and equipment ( 659 ) ( 10,846 )

Proceeds from the sale of equipment — 87

Payments for property and equipment ( 1,568 ) ( 99 )

Net cash used in investing activities ( 1,568 ) ( 12 )

1 unchanged sentence

Proceeds from notes payable, net of original issuance discount 22,000 9,038

Proceeds from other financial obligations 1,133 —

Proceeds from related party notes payable 1,876 3,000

Proceeds from sale of Common Stock, net of issuance costs — 8,520

Proceeds from exercise of warrants — 4,074

Payments of notes payable ( 101 ) —

Settlement of notes payable transaction costs ( 1,310 ) ( 2,489 )

Payments of finance lease obligations — ( 1,016 )

Proceeds from exercise of stock options — 44

Payments of notes payable and other financing obligations ( 309 ) —

Payments of notes payable issuance costs ( 99 ) ( 25 )

Net cash provided by financing activities

24,601 12,013

Effect of exchange rate changes on cash and restricted cash ( 419 ) ( 2 )

Net change in cash and restricted cash 3,324 ( 9,947 )

Net (decrease) increase in cash and restricted cash 2,319 ( 2,720 )

Cash and restricted cash, beginning of period 7,174 4,025

4 unchanged sentences

The following table provides a reconciliation of cash and restricted cash reported within the Unaudited Condensed Consolidated Balance Sheets that aggregate to the total of the same such amounts shown in the Unaudited Condensed Consolidated Statements of Cash Flows:

September 30, 2024 September 30, 2023

March 31, 2025 March 31, 2024

Cash and restricted cash

1 unchanged sentence

Restricted cash 35 898

Total cash and restricted cash $ 7,349 $ 8,567

Nine Months Ended September 30,

Supplemental disclosure of noncash investing and financing activities

Additions of property, plant and equipment included in accounts payable and accrued expenses $ 45,455 34,124

Reclassification of stock-based awards from liability to equity on February 28, 2023 due to authorized share increase — 8,978

Conversion of notes payable, related party notes payable and accrued interest into Class A Common Stock (as restated) 44,891 125,327

Issuance of SPA Warrants and Junior SPA Warrants 17,194 34,257

Reclassification of earnout shares from liability to equity on February 28, 2023 due to authorized share increase — 5,014

Reclassification of earnout shares from equity to liability on April 21, 2023 due to insufficient authorized shares — 2,112

Reclassification of stock-based awards from equity to liability on April 21, 2023 due to insufficient authorized shares — 2,979

Reclassification of earnout shares from liability to equity on August 25, 2023 due to authorized share increase — 1,381

Reclassification of stock-based awards from liability to equity on August 25, 2023 due to authorized share increase — 2,043

Issuance of exchange note — 16,500

Reclassification of warrants from equity to liability — 6,811

Reduction in warrants pursuant to the Exchange Agreement — 16,506

Purchase of Class A Common Stock under the Salary Deduction and Stock Purchase Agreements 36 —

RSU tax withholdings 10 —

Supplemental disclosure of noncash operating activities

Settlement of Palantir dispute with issuance of Class A Common Stock 2,400 —

$ 9,493 $ 1,305

Three Months Ended March 31,

Supplemental disclosure of cash flow information

Cash paid for interest $ 1,376 $ 465

Cash paid for taxes $ — $ —

Supplemental disclosure of noncash investing and financing activities

Additions of property and equipment included in accounts payable and accrued expenses $ — $ 45,424

Settlement of HSL s.l.r.

liability in Class A Common Stock $ 1,185 $ —

Conversion of notes payable, related party notes payable and accrued interest into Class A Common Stock $ 15,573 $ 9,118

Issuance of warrants with the SPA Portfolio Notes $ 15,084 $ 1

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

1 unchanged sentence

Notes to Unaudited Condensed Consolidated Financial Statements

Nature of Business and Organization and Basis of Presentation

Nature of Business and Organization, Basis of Presentation, and Summary of Significant Accounting Policies

Nature of Business and Organization

Faraday Future Intelligent Electric Inc.

(the “Company” or “FF”), a holding company incorporated in the State of Delaware on February 11, 2020, conducts its operations through the subsidiaries of FF Intelligent Mobility Global Holdings Ltd.

(“Legacy FF”), founded in 2014 and headquartered in Los Angeles, California.

Unless otherwise stated or the context requires otherwise, references herein to the “Company,” “FFIE,” “FFAI,” “Faraday” “we,” “us,” and “our” mean Faraday Future Intelligent Electric Inc.

and its wholly-owned subsidiaries, and controlled and managed entities.

The Company is a holding company incorporated in the State of Delaware on February 11, 2020, conducts its operations through its subsidiaries and is headquartered in 18455 S.

Figueroa Street, Gardena, CA 90248.

The Company operates in a single operating segment and designs and engineers next-generation, intelligent, electric vehicles.

The Company manufactures its vehicles at the FF ieFactory California in Hanford, California and has additional engineering, sales, and operations capabilities in China.

The Company manufactures its vehicles at its production facility in Hanford, California, known as “FF ieFactory California” and has additional engineering, sales, and operations capabilities in China.

The Company has created innovations in technology, products, and a user-centered business model that are being incorporated into its planned electric vehicle platform.

Principles of Consolidation and Basis of Presentation

The Unaudited Condensed Consolidated Financial Statements have been prepared in conformity with U.S.

generally accepted accounting principles (“GAAP”) and include the accounts of the Company, its wholly-owned subsidiaries and all other entities in which the Company has a controlling financial interest, including the accounts of any variable interest entity in which the Company has a controlling financial interest and for which it is the primary beneficiary.

Principles of Consolidation

The Unaudited Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the U.S.

(“GAAP”) and include the accounts of the Company, its wholly-owned subsidiaries and all other entities in which the Company has a controlling financial interest, including the accounts of any variable interest entity, in which the Company has a controlling financial interest and for which it is the primary beneficiary in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation (“ASC 810”).

All intercompany transactions and balances have been eliminated upon consolidation.

These Unaudited Condensed Consolidated Financial Statements do not include all disclosures that are normally included in annual audited financial statements prepared in accordance with GAAP and should be read in conjunction with the Company’s audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2023, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on May 28, 2024 (as amended, the “Form 10-K”).

Accordingly, the Unaudited Condensed Consolidated Balance Sheet as of September 30, 2024, has been derived from the Company’s annual audited Consolidated Financial Statements but does not contain all of the footnote disclosures from the annual financial statements.

These Unaudited Condensed Consolidated Financial Statements do not include all disclosures that are normally included in the Annual audited financial statements prepared in accordance with GAAP and should be read in conjunction with the Company’s Audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2024, included in the Company’s Annual Report on Form 10-K filed with the U.S.

Securities and Exchange Commission (“SEC”) on March 31, 2025, (the “Form 10-K”).

Accordingly, the Unaudited Condensed Consolidated Balance Sheet as of March 31, 2025, has been derived from the Company’s Annual audited Consolidated Financial Statements but does not contain all of the footnote disclosures from the annual financial statements.

The Company believes that the disclosures included in this Quarterly Report on Form 10-Q (this “Form 10-Q”) are adequate to make the information presented not misleading.

In the opinion of management, the Unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position, results of operations, and cash flows for the periods presented.

The accounting policies used in the preparation of these Unaudited Condensed Consolidated Financial Statements are the same as those disclosed in the audited Consolidated Financial Statements for the year ended December 31, 2023, included in the Form 10-K, except as described below.

The accounting policies used in the preparation of these Unaudited Condensed Consolidated Financial Statements are the same as those disclosed in the audited Consolidated Financial Statement for the year ended December 31, 2024, included in the Form 10-K, except as described below.

Our annual reporting period is the calendar year.

The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of the results to be expected for the 2024 full year or any future periods.

Reclassification

For the nine months ended September 30, 2023 , the Company reclassified $ 0.4 million fro m Loss on write-off of vendor deposits, net to Other within the Condensed Consolidated Statement of Cash Flows.

This reclassification increased the Other line item total from $ 1.0 million to $ 1.4 million .

The adjustment was made to streamline the presentation by consolidating immaterial items, thereby enhancing the clarity of our financial reporting.

Prior period amounts have been reclassified to conform to the current period presentation.

This reclassification had no impact on the Company's net cash provided by operating activities, investing activities, or financing activities.

The results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected for the 2025 full year or any future periods.

Basis of Presentation

Use of Estimates and Judgments

The preparation of the Company’s Unaudited Condensed Consolidated Financial Statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts and disclosures in such financial statements and in the accompanying notes.

Actual results may differ materially from these estimates.

Estimates are based on historical experience, where applicable, and other assumptions that management believes are reasonable under the circumstances.

The preparation of the Company’s Unaudited Condensed Consolidated Financial Statements in conformity with GAAP and in accordance with the rules and regulations of the SEC requires management to make estimates and assumptions which affect the reported amounts in the Unaudited Condensed Consolidated Financial Statements.

Estimates are based on historical experience, where applicable, and other assumptions which management believes are reasonable under the circumstances.

On an ongoing basis management evaluates its estimates, including those related to the:

(i) recognition and disclosure of contingent liabilities, including litigation reserves;

(ii) fair value of related party notes payable

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

and notes payable;

(iii) calculations related to the evaluation of possible long term asset impairment;

and (iv) valuation of warrants.

(ii) fair value of related party notes payable and notes payable;

(iii) calculations for evaluating potential long-term asset impairment;

and (iv) valuation of warrants and other derivative instruments.

Such estimates often require the selection of appropriate valuation methodologies and financial models and may involve significant judgment in evaluating ranges of assumptions and financial inputs.

Actual results may differ from those estimates under different assumptions, financial inputs, or circumstances.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Given the global economic climate, estimates are subject to additional volatility.

As of the date of filing the Company’s Unaudited Condensed Consolidated Financial Statements on this Form 10-Q with the SEC for the period ended September 30, 2024, the Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or revisions to the carrying value of its assets or liabilities.

As of the date of filing the Company’s Unaudited Condensed Consolidated Financial Statements on this Form 10-Q with the SEC for the period ended March 31, 2025, the Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or to revise the carrying value of its assets or liabilities.

However, these estimates and judgments may change as new events occur and additional information is obtained, which may result in changes being recognized in the Company’s Unaudited Condensed Consolidated Financial Statements in future periods.

Actual results could differ from those estimates and any such differences may have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.

Revenue Recognition

Revenue is recognized by the Company in accordance with Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Accounting Standards Codification (“ASC”) Topic 606) (“ASU 2014-09”).

In order to recognize revenue under ASU 2014-09, the Company applies the following five steps:

• identify a customer along with a corresponding contract;

• identify the performance obligation(s) in the contract to transfer goods or provide distinct services to a customer;

• determine the transaction price the Company expects to be entitled to in exchange for transferring promised goods or services to a customer;

• allocate the transaction price to the performance obligation(s) in the contract;

• recognize revenue when or as the Company satisfies the performance obligation(s).

Revenue was $ 0.01 million and $ 0.6 million for the three months ended September 30, 2024 and 2023 , respectively.

For the nine months ended September 30, 2024 and 2023 , revenue was $ 0.3 million and $ 0.6 million , respectively.

Revenue is grouped into automotive sales revenue and automotive leasing revenue.

Automotive Sales Revenue

The Company began the production of its first vehicle, the FF 91 Futurist (the “FF 91,” “FF 91 Futurist”, or “FF 91 2.0 Futurist Alliance”), in March 2023 and began delivering to customers in August 2023.

Automotive sales revenue includes revenues related to deliveries of new vehicles, and specific other features and services including home charger, charger installation, 24/7 roadside assistance, over-the-air (“OTA”) software updates, internet connectivity and destination fees.

The Company recognizes revenue on automotive sales upon delivery to the customer, which is when control of a vehicle transfers.

Payments are typically received at the point control transfers or in accordance with payment terms customary to the business and as indicated in the sales contract.

OTA software updates are provisioned upon transfer of control of a vehicle and recognized over time on a straight-line basis as the Company has a stand-ready obligation to deliver such services to the customer.

For obligations related to automotive sales, FF estimates standalone selling price by considering costs used to develop and deliver the good or service, third-party pricing of similar options and other information that may be available.

The transaction price is allocated among the performance obligations in proportion to the standalone selling price of the Company’s performance obligations.

Vehicle contracts do not contain a significant financing component.

Automotive sales revenue was zero and $ 0.3 million for three and nine months ended September 30, 2024, respectively.

Revenue from promises to the customer that are considered immaterial are combined with the vehicle performance obligation and recognized when the product has been transferred.

The Company accrues costs to transfer these immaterial goods and services regardless of whether they have been transferred.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company provides its customers with a residual value guarantee that may or may not be exercised in the future.

The impact of such residual value guarantees was immaterial to the Company’s Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2024.

Co-creation Arrangements

As part of the Company’s Futurist Product Officers (“FPO”) Co-Creation Delivery program that began in August 2023, the Company has entered into co-creation agreements with certain customers.

The arrangement leverages some of the Company’s sales and leasing customers to share vehicle feedback, driving data, ideas, and experiences with the Company’s engineers, social media posts and other promotions in exchange for specified fees.

For the services performed, the Company compensates the respective customers through a monthly consulting fee payment or a discount on their monthly lease payment.

The consideration paid to these customers relate to marketing and R&D services that are distinct and could be purchased by the Company from a separate third party.

Management examined in detail the services provided by each respective customer in accordance with the co-creation agreement, established various data points, and rationally assigned a dollar amount that was deemed representative of the fair value of the services.

Co-creation payments that exceed the fair value of the distinct services performed by the customer are considered consideration paid to the customer and were treated as a reduction in revenue.

Co-creation fees recorded as a reduction to revenue and also within research and development (“R&D”) expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss were less than $ 0.2 million and $ 0.5 million for the three and nine months ended September 30, 2024, respectively.

The Company has entered into and may continue to enter into co-creator consulting agreements with its customers under which customers share feedback, driving data, ideas, and experiences with the Company’s engineers, social media posts and other promotions in exchange for specified fees.

The Company considers these arrangements consideration payable to a customer.

The consideration paid to the customer relates to marketing and R&D services that are distinct and could be purchased by the Company from a separate third party.

The Company performs an analysis in which it maximizes the use of observable market inputs to ascribe a fair value to these services and record the fair value of these services to sales and marketing expense or R&D expense, as applicable.

Any consideration payable to a customer that is above the fair value of the distinct services being provided is treated as a reduction of revenue.

Automotive Leasing Revenue

Sales-Type Leasing Program

The Company has outstanding leases accounted for as sales-type leases under ASC 842, Leases (“ASC 842”).

Customers have the right to purchase the vehicle at the end of the lease term, which is usually 36 months.

A customer qualifies under this program if the purchase option is reasonably certain to be exercised, and the Company therefore expects the customer to take title to the vehicle at the end of the lease term after making all contractual payments.

The Company recognizes all revenue and costs associated with the sales-type lease as automotive leasing revenue and automotive leasing cost of revenue, respectively, upon delivery of the vehicle to the customer when collectability of lease payments is probable at lease commencement.

If collectability of lease payments is not probable at commencement, the Company recognizes the lease payments as deposit liability on the Company’s Condensed Consolidated Balance Sheets and does not derecognize the leased vehicle until such point that collectability of lease payments becomes probable.

R evenue under this program was immaterial for the three and nine months ended September 30, 2024 .

Operating Leasing Program

The Company has outstanding leases under its vehicle operating leasing program in the United States.

Qualifying customers are permitted to lease a vehicle for up to 36 months.

At the end of the lease term, customers are generally required to return the vehicle to the Company.

The Company accounts for these leasing transactions as operating leases.

The Company records leasing revenues to automotive leasing revenue on a straight-line basis over the contractual term, and it records the depreciation of these vehicles to cost of automotive leasing revenue.

For the three and nine months ended September 30, 2024, the revenue recorded under this program was immaterial .

As of September 30, 2024, deferred lease-related upfront payments that will be recognized on a straight-line basis over the contractual terms of the individual leases were immaterial.

The Company’s policy is to exclude taxes collected from a customer from the transaction price of automotive contracts.

Reverse Stock Splits and Recasting of Per-Share Amounts

On August 4, 2024, the Board approved the implementation of a 1-for-40 reverse stock split (the “Third Reverse Stock Split”) of the Common Stock and set the number of authorized shares of Common Stock to 104,245,313 .

The Third Reverse Stock Split was effected after market close on August 16, 2024, and shares of the Class A Common Stock par value $ 0.0001 per share and the Public Warrants began trading on a split-adjusted basis as of market open on August 19, 2024.

All shares of Common Stock, Public Warrants, stock-based compensation awards, earnout shares and per share amounts contained in the Unaudited Condensed Consolidated Financial Statements and accompanying notes have been retroactively adjusted to reflect the Reverse Stock Split, Second Reverse Stock Split and the Third Reverse Stock Split.

In addition, proportionate adjustments were made to the number of shares of Class A Common Stock issuable upon exercise or conversion of the Company’s outstanding convertible debt securities and warrants, as well as the applicable exercise or conversion prices.

See Note 12, Stockholders’ Equity , and Note 13, Stock-Based Compensation , for further discussion regarding the Reverse Stock Split, the Second Reverse Stock Split, and the Third Reverse Stock Split.

The Company operates in one operating segment and one reportable segment.

T he Company’s two Global Co-Chief Executive Officers (“Global Co-CEOs”), acting jointly serving as Co-Chief Operating Decision Makers (“CODMs”), regularly evaluate the Company’s financial performance using consolidated financial information at the total-company level.

The CODMs receive regular financial and operational reporting that focuses primarily on the Company's consolidated loss from operations, overall cash flows, liquidity, and strategic initiatives.

Management has identified Loss from operations, as presented in the Company's Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, as the primary measure used by the CODMs to evaluate the performance of the business and allocate resources.

This measure is critical for a going concern that must carefully manage its cash outflows, particularly given that the timing of its cash inflows is influenced by external investor decisions.

The Company defines “significant segment expense” as controllable operating costs that are regularly provided to and reviewed by management, which include the expenses presented in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss as Cost of revenue, Research and development, Sales and marketing, and General and administrative.

Management closely tracks its expenditure on these key expense categories through regular reviews of cash balances, near‑term cash flow projections, monthly management reports, and project management reports.

The CODMs, work in close collaboration with the Company’s business leaders to establish critical operational targets, set project timelines, and adjust spending plans.

These leaders are responsible for implementing its strategic plans and revising targets and deadlines based on continuous internal communications and review meetings, thereby ensuring that any deviations from target spending or project timelines are promptly addressed.

This rigorous oversight supports the Company’s strategic objectives to focus business activities on production, sales, and leasing of its FF 91 vehicles, and the planned launch of the FX Series vehicles.

In addition, the Company defines “other segment items” as other operating expense adjustments that arise from lease or other impairments, gains and losses on the sale or disposition of its fixed assets, or other market‑driven factors that impact Loss from operations presented in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss and are not part of the Company’s recurring and controllable operating costs .

By segregating these “Other Segment Items” from “Loss from operations,” the Company provides investors with a clear view of the expenses that management can directly influence versus those driven by external factors.

Other potentially reportable items, such as separate automotive sales and leasing revenues (currently immaterial), geographic information, depreciation expense, interest expense, or other segment-specific activities, are not separately reviewed by the CODMs.

Accordingly, these detailed segment components do not influence the CODMs’ decision-making or resource allocation processes and thus are not separately disclosed.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Customer Deposits and Deferred Revenue

The Company’s customers may reserve a vehicle and pre-order certain services by making a customer deposit, which is fully refundable at any time.

Refundable deposits, for vehicle reservations and services, received from customers prior to an executed vehicle purchase agreement are recorded as customer deposits within Accrued expenses and other current liabilities on the Company’s Condensed Consolidated Balance Sheets.

Customer deposits were $ 3.2 million as of each of September 30, 2024 and December 31, 2023.

When vehicle purchase agreements are executed, the consideration for the vehicle and any accompanying products and services must be paid in advance prior to the transfer of products or services by the Company.

Such advance payments are considered non-refundable, and the Company defers revenue related to any products or services that are not yet transferred.

Deferred revenue is equivalent to the total transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, as of the balance sheet date.

Deferred revenue related to products and services w as immaterial a s of September 30, 2024 and December 31, 2023.

The Company provides a manufacturer’s warranty on all vehicles sold.

The warranty covers the rectification of reported defects via repair, replacement, or adjustment of faulty parts or components.

The warranty does not cover any item where failure is due to normal wear and tear.

This assurance-type warranty does not create a performance obligation separate from the vehicle.

Management tracks warranty claims by vehicle ID, owner, and date.

As the Company continues to manufacture and sell more vehicles, it will reassess and evaluate its warranty claims for purposes of its warranty accrual.

(in thousands) Nine Months Ended September 30, 2024

Accrued warranty - beginning of period $ 684

Provision for warranty 34

Warranty costs incurred ( 173 )

Accrued warranty - end of period $ 545

Cost of Revenue

Automotive Sales Revenue

Cost of revenue includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, shipping and logistic costs, vehicle connectivity costs, and reserves for estimated warranty expenses.

Cost of automotive sales revenues also includes adjustments to warranty expense.

Cost of services and other revenue includes costs associated with providing non-warranty after-sales services, costs for retail merchandise, and costs to provide vehicle insurance.

Cost of services and other revenue also includes direct parts and material.

Automotive Leasing Program

Cost of leasing revenue includes the depreciation of operating lease vehicles, cost of goods sold associated with direct sales-type leases and warranty expense related to leased vehicles.

Summary of Significant Accounting Policies

Property, Plant and Equipment, Net

2 unchanged sentences

Upon sale or disposition, the cost and related accumulated depreciation or amortization are removed from the Unaudited Condensed Consolidated Balance Sheets and any gain or loss is included in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Depreciation and amortization on property, plant and equipment is calculated using the straight-line method over the estimated useful lives of the assets and for leasehold improvements, over the remaining term of the lease, if shorter.

Depreciation and amortization on property and equipment is calculated using the straight-line method over the estimated useful lives of the assets and for leasehold improvements, over the term of the lease, if shorter.

Building improvements 15

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Leasehold improvements Shorter of 15 years or

remaining term of the lease

Construction in process (“CIP”) consists of the construction activities related to the FF ieFactory California production facility plant and tooling, machinery and equipment being built to serve the manufacturing of production vehicles.

These assets are capitalized and depreciated once put into service.

term of the lease

Construction in process (“CIP”) consists of the construction activities related to the FF ieFactory California production facility in plant and tooling, machinery and equipment being built to serve the manufacturing of production vehicles.

These assets are depreciated once put into service.

The amounts capitalized in CIP that are held at vendor sites relate to the completed portion of work-in-progress of tooling, machinery and equipment built based on the Company’s specific needs.

The Company may incur storage fees or interest fees related to CIP that are expensed as incurred.

CIP is presented within Property, plant and equipment, net on the Unaudited Condensed Consolidated Balance Sheets.

The Company may incur storage fees or interest fees related to CIP which are expensed as incurred.

CIP is presented within Property, Plant, and Equipment, Net in the Unaudited Condensed Consolidated Balance Sheets.

Impairment of Long-Lived Assets

The Company reviews its long-lived assets, consisting primarily of property, plant and equipment, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable.

The Company reviews its long-lived assets, consisting primarily of property and equipment and right-of-use assets (“ROU”), for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset groups) may not be recoverable.

The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

2 unchanged sentences

Assets classified as held for sale are also assessed for impairment and such amounts are determined at the lower of the carrying amount or fair value, less costs to sell the asset.

An impairment charge was taken during the second quarter of 2024 related to the Company’s right-of-use assets.

See Note 9, Leases for more information.

Stock-Based Compensation

Effective January 1, 2023, stock-based compensation expense is reduced for forfeitures only when they occur.

This change of accounting policy resulted in the recognition of a cumulative increase of prior stock-based compensation expenses totaling $ 1.8 million, which was recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the nine months ended September 30, 2023.

There was no income tax provision impact on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2024.

The income tax provision (benefit) recognized for the three and nine months ended September 30, 2023 was immaterial.

The difference in the Company’s effective tax rate from the federal statutory rate of 21% is due to the ratio of domestic and international loss before taxes.

The Company records a full valuation allowance to reflect limited benefits for income taxes in jurisdictions that historically reported losses and a

During 2024, the Company recorded an impairment charge related to its right-of-use assets.

See Note 10, Leases for further details.

No other impairment charges for long-lived assets were recorded during the quarters ended March 31, 2025 and 2024.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

provision for income taxes in jurisdictions that are profitable.

The income tax provision for each period was the combined calculated tax expenses/benefits for various jurisdictions.

The Company is subject to taxation and files income tax returns with the U.S.

federal government, the state of California and China.

The Company’s income tax returns are open to examination by the relevant tax authorities until the expiration of the applicable statute of limitations, which is generally three years after the filing of the tax return.

As of September 30, 2024, the Company is not under any tax audits on its income tax returns.

All of the Company’s prior year tax returns, from 2017 through 2023, are open under Chinese tax law.

The Company did not accrue any interest or penalties related to the Company's unrecognized tax benefits as of September 30, 2024 and 2023, as the uncertain tax benefits only reduced the net operating losses.

The Company does not expect the uncertain tax benefits to have a material impact on its Unaudited Condensed Consolidated Financial Statements within the next twelve months.

Reverse Stock Splits and Recasting of Per-Share Amounts

On August 22, 2023, the Company’s Board of Directors (the “Board”) approved the implementation of a 1-for-80 reverse stock split (the “August 2023 Reverse Stock Split”) of the Company’s Class A Common Stock, par value $ 0.0001 per share (the “Class A Common Stock”) and Class B Common Stock, par value $ 0.0001 per share (the “Class B Common Stock,” and together with the Class A Common Stock, the “Common Stock”) and set the number of authorized shares of Common Stock to 3,860,938 (which is 308,875,000 divided by 80).

The August 2023 Reverse Stock Split was effected after market close on August 25, 2023, and shares of the Class A Common Stock and publicly traded warrants (the “Public Warrants”) began trading on a split-adjusted basis as of market open on August 28, 2023.

As approved by the Company’s stockholders at a special meeting held on February 5, 2024, the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the office of the Secretary of State of the State of Delaware to effect an increase in the number of authorized shares of Common Stock from 3,860,938 to 34,748,438 .

On February 23, 2024, the Board approved the implementation of a 1-for-3 reverse stock split (the “February 2024 Reverse Stock Split”) of the Common Stock and set the number of authorized shares of Common Stock to 11,582,813 (which is 34,748,438 divided by 3).

The February 2024 Reverse Stock Split was effected after market close on February 29, 2024, and shares of the Class A Common Stock and the Public Warrants began trading on a split-adjusted basis as of market open on March 1, 2024.

As approved by the Company’s stockholders at the annual meeting held on July 31, 2024, the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the office of the Secretary of State of the State of Delaware to effect an increase in the number of authorized shares of Common Stock from 11,582,813 to 104,245,313 .

On August 4, 2024, the Board approved the implementation of a 1-for-40 reverse stock split (the “August 2024 Reverse Stock Split”) of the Common Stock and set the number of authorized shares of Common Stock to 104,245,313 .

The August 2024 Reverse Stock Split was effected after market close on August 16, 2024, and shares of the Class A Common Stock and the Public Warrants began trading on a split-adjusted basis as of market open on August 19, 2024.

All shares of Common Stock, Public Warrants, stock-based compensation awards, earnout shares and per share amounts contained in the Unaudited Condensed Consolidated Financial Statements and accompanying notes have been retroactively adjusted to reflect the August 2023 Reverse Stock Split, February 2024 Reverse Stock Split, and August 2024 Reverse Stock Split (collectively, the “Splits”).

See Note 11, Stockholders’ Equity , and Note 12, Stock-Based Compensation , for further discussion regarding the Splits.

Revenue Recognition

The following table disaggregates our revenue by major source:

Three Months Ended March 31,

(in thousands) 2025 2024

Automotive sales $ — $ —

Automotive leasing - Sales type 265 —

Automotive leasing - Operating type 51 2

Automotive Sales Revenue

The Company began the production of its first vehicle the FF 91 Futurist (the “FF 91,” “FF 91 Futurist”, or “FF 91 2.0 Futurist Alliance”) in March 2023 and started making deliveries to customers in August 2023.

The Company recognizes automotive sales revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers.

Automotive sales revenue includes cash deliveries of new vehicles, and specific other features and services including home charger, charger installation, twenty-four-seven roadside assistance, over-the-air (“OTA”) software updates, internet connectivity and destination fees that meet the definition of a performance obligation under ASC 606.

Revenue is recognized when control of the vehicle transfers upon delivery to the customer.

Payments are typically received at the point control transfers or according to payment terms customary to the business as specified in the sales contract.

Vehicle contracts do not contain a significant financing component.

For obligations related to automotive sales, transaction prices are allocated among performance obligations based on relative standalone selling prices, determined using market prices, estimated internal costs, and comparable third-party offerings.

The transaction price is allocated among the performance obligations in proportion to the standalone selling price of its performance obligations.

Other features and services as discussed above are provisioned upon transfer of control of the vehicle and are required to be recognized on a straight-line basis over the performance period, as the Company has a stand-ready obligation to deliver such services to the customer.

However, due to immateriality, revenue from other features and services are combined with the vehicle performance obligation and recognized upon the transfer of the vehicle.

The Company provides certain customers with a residual value guarantee which may or may not be exercised in the future.

Residual value guarantees provided to customers had an immaterial impact on revenue for the three months ended March 31, 2025 and 2024 .

Automotive Leasing Revenue

The Company accounts for its automotive leasing revenue program under ASC 606 and ASC Topic 842, Leases (“ASC 842”).

Operating Leasing Program :

The Company offers a vehicle operating leasing program in the U.S., allowing qualifying customers to lease a vehicle directly from the Company for a lease term of up to 36 months.

At the end of the lease term, customers are generally required to return the vehicle to the Company, at which point the Company may either sell or re-lease the returned vehicle.

Leasing revenue from operating leases is recognized on a straight-line basis over the lease term, as long as collectability is probable in accordance with ASC 842.

If collectability of lease payments is not probable at lease commencement, lease income is recognized on a cash basis, meaning payments received are recorded as revenue only when collected.

Depreciation expense related to leased vehicles is recorded in cost of automotive leasing revenue on a straight-line basis over the lease term, reflecting the expected residual value of the vehicles at lease termination.

Upfront payments related to lease agreements are deferred and recognized as revenue on a straight-line basis over the respective lease term.

Taxes collected from customers in connection with automotive leasing transactions are excluded from the transaction price and reported separately in accordance with ASC 606.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Sales-Type Leasing Program :

The Company enters into sales-type lease arrangements in accordance with ASC 842, under which customers generally have the option to purchase the leased vehicle at the end of the lease term, which is typically 36 months.

The lease is classified as a sales-type lease when the Company concludes that the customer is reasonably certain to exercise the purchase option and, as a result, the Company expects the customer to obtain title to the vehicle upon completion of all contractual payments.

At lease commencement, if collectability of the lease payments is probable, the Company derecognizes the leased vehicle and recognizes:

• Automotive leasing revenue for the present value of lease payments and any guaranteed residual value;

• Automotive leasing cost of revenue for the carrying value of the leased vehicle.

If collectability is not deemed probable at lease commencement, revenue recognition is deferred, and lease payments received are recorded as a deposit liability.

The leased vehicle remains on the Company’s balance sheet until collectability becomes probable, at which point revenue recognition is triggered.

The Company recognizes a net investment in sales-type leases, which includes both the lease receivable and the unguaranteed residual asset.

The unguaranteed residual asset represents the estimated fair value of the leased vehicle at the end of the lease term that is not guaranteed by the lessee or any third party.

As of March 31, 2025, the carrying amount of unguaranteed residual assets included in the net investment in sales-type leases, and presented within accounts receivable, was approximately $ 0.3 million.

The estimate of unguaranteed residual value reflects management’s judgment, informed by historical residual value experience, current market conditions, and the anticipated future utility of the leased assets.

Co-creation Arrangements

As part of the Company’s Futurist Product Officers (“FPO”) Co-Creation Delivery program, which began in August 2023, the Company has entered into co-creation agreements with certain customers.

This arrangement leverages select sales and leasing customers to provide valuable driving data, insights, marketing, and brand awareness for the FF 91 vehicle.

In exchange for these services, the Company compensates customers through either a monthly consulting fee or a discount on their lease payments.

The services provided are considered distinct and could be purchased separately from a third party.

Management conducted a detailed evaluation of each customer’s services under the co-creation agreement, established relevant data points, and assigned a fair value to the services provided.

Any payments exceeding the fair value of these services are treated as consideration paid to the customer and recorded as a reduction of revenue.

For the three months ended March 31, 2025 and 2024, the Company recognized $ 0 in co-creation fees as a reduction of revenue in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Additionally, the Company recorded $ 0.14 million and $ 0.16 million in co-creation fees as marketing expenses for the same periods.

Co-creation fees related to R&D were considered immaterial and were included in Sales and marketing expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Customer Deposits

The Company’s customers may reserve a vehicl e and preorder certain services by making a customer deposit, which is fully refundable at any time.

Customer deposits we re $ 3.0 million and $ 3.0 million as of March 31, 2025 and December 31, 2024 , respectively.

Deferred Revenue

When vehicle purchase agreements are executed, the consideration for the vehicle and any accompanying products and services must be paid in advance before the transfer of products or se rvices by the Company.

Unlike customer deposits, which are refundable, these advance payments are non-refundable.

The Company recognizes revenue when control of the vehicle or related services transfers to the customer and defers revenue only when payments are received for undelivered products or services.

Deferred revenue represents the total transaction price allocated to performance obligations that remain unsatisfied or partially unsatisfied as of the balance sheet date.

As of March 31, 2025 and December 31, 2024 d eferred revenue related to products and services w as immaterial .

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Cost of Revenue

Automotive Sales Revenue

Cost of automotive sales revenue includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, shipping and logistic costs, vehicle connectivity costs, and reserves for estimated warranty expenses.

Cost of automotive sales revenues also includes adjustments to warranty expense.

Cost of services and other revenue includes costs associated with providing non-warranty after-sales services, costs for retail merchandise, and costs to provide vehicle insurance.

Cost of services and other revenue also includes direct parts and material.

Cost of services and other revenue was immaterial for the three months ended March 31, 2025 and 2024.

Automotive Leasing Program

Cost of automotive leasing revenue includes the depreciation of operating lease vehicles, cost of goods sold associated with direct sales-type leases and warranty expenses related to leased vehicles.

The Company provides a manufacturer’s warranty on all vehicles sold.

The warranty covers the rectification of reported defects via repair, replacement, or adjustment of faulty parts or components.

The warranty does not cover any item that fails due to normal wear and tear.

This assurance-type warranty does not create a performance obligation separate from the vehicle.

Management tracks warranty claims by vehicle ID, owner, and date.

As the Company continues to manufacture and sell more vehicles it will reassess and evaluate its warranty claims for purposes of its warranty accrual.

Three Months Ended March 31,

(in thousands) 2025 2024

Accrued warranty- beginning of period $ 545 $ 684

Provision for warranty ( 56 ) 38

Warranty costs incurred ( 45 ) ( 64 )

Accrued warranty- end of period $ 444 $ 658

The Company accounts for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and income tax bases of assets and liabilities.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years when those temporary differences are anticipated to reverse.

A valuation allowance is established if it is more likely than not that some or all of the deferred tax assets will not be realized.

The carrying value of deferred tax assets is adjusted to reflect the amount that is more likely than not to be realized.

As of March 31, 2025 and December 31, 2024, the Company maintained a full valuation allowance against its net deferred tax assets, based on the conclusion that it is more likely than not the assets will not be realized.

The Company applies the guidance in ASC 740-10, Income Taxes , to account for uncertain tax positions.

This guidance requires a two-step approach:

(1) determine whether it is more likely than not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation;

and (2) measure the tax benefit as the largest amount that is more likely than not to be realized upon settlement.

The Company evaluates its tax positions based on a number of factors and may update its assessments as facts and circumstances change.

The Company is subject to taxation in the U.S.

federal jurisdiction, the state of California, and China.

The income tax provision for each period represents the aggregate estimated tax expense or benefit for these jurisdictions.

The income tax provision had a $ 10 thousand impact for the three months ended March 31, 2025, and no impact for the three months ended March 31, 2024, on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

The Company recognizes interest and penalties on unrecognized tax benefits as a component of income tax expense.

There were no material interest or penalties for the three months ended March 31, 2025 and 2024.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Recent Accounting Pronouncements

In early 2025, the Financial Accounting Standards Board (“FASB”) issued several ASUs to enhance financial reporting and provide clearer guidance on various accounting topics.

As a December 31 year-end filer and a Smaller Reporting Company (“SRC”), the Company is required to adopt these ASUs in accordance with the effective dates applicable to SRCs.

The Company is currently evaluating the impact of these ASUs on the Company’s financial statements and related disclosures.

Below is a summary of these ASUs:

Recently issued accounting pronouncements not yet adopted

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure (ASU 2023-07).

This ASU updates reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment's profit or loss.

This ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources.

The ASU is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Adoption of the ASU should be applied retrospectively to all prior periods presented in the financial statements.

The Company is in the process of evaluating the effect of ASU 2023-07 on its consolidated financial statements.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (ASU 2023-09).

ASU 2023-09 is intended to enhance the decision usefulness of income tax disclosures and requires the disclosure of various disaggregated information, including an entity’s effective tax rate reconciliation as well as additional information on taxes paid.

This ASU is effective on a prospective basis for annual periods beginning after December 15, 2024 with early adoption allowed.

The Company is in the process of evaluating the effect of ASU 2023-09 on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

This ASU enhances the transparency of income tax disclosures by requiring more detailed information about the rate reconciliation and income taxes paid, disaggregated by jurisdiction.

This update is effective for the Company beginning January 1, 2026, and will first apply to the Company’s December 31, 2026, Form 10-K, with early adoption permitted.

In December 2024, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40 ).

This ASU requires public business entities to disclose additional details about certain expenses in the notes to financial statements, such as inventory purchases, employee compensation, depreciation, and intangible asset amortization.

This standard is effective for the Company beginning January 1, 2027, and will first apply to the Company’s December 31, 2027, Form 10-K, with early adoption permitted.

In January 2025, the FASB issued ASU 2025-04, Leases (Topic 842):

Common Control Arrangements .

This ASU provides new guidance on lease arrangements between entities under common control, clarifying the criteria for determining whether a lease exists and how to account for such transactions.

This update is effective for the Company beginning January 1, 2026, and will first apply to the Company’s December 31, 2026, Form 10-K, with early adoption permitted.

Liquidity and Capital Resources and Going Concern

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Based on its recurring losses from operations since inception and continued cash outflows from operating activities (all as described below), the Company has concluded that there is substantial doubt about its ability to continue as a going concern for a period of one year from the date that these Unaudited Condensed Consolidated Financial Statements were issued.

Preparation of Financial statements

The Unaudited Condensed Consolidated Financial Statements do not include any adjustments that might result from the outcome of this uncertainty.

Accordingly, the Unaudited Condensed Consolidated Financial Statements have been prepared on a basis that assumes the Company will continue as a going concern and that contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

The Company has and will continue to devote substantial effort and, to the extent available, capital resources, to strategic planning, engineering, design, and development of its electric vehicle platform, development of vehicle models, finalizing the build out of the FF ieFactory California manufacturing facility, and capital raising.

The Company incurred cumulative losses from operations, negative cash flows from operating activities, and has an accumulated deficit of $ 4,193.1 million, an unrestricted cash balance of $ 7.3 million and a negative working capital position of $ 168.3 million, excluding restricted cash, as of September 30, 2024.

During 2023, the Company delivered its first vehicles but expects to continue generating significant operating losses for the foreseeable future.

The Company has funded its operations and capital needs primarily through the issuance of related party notes payable and notes payable (see Note 7, Notes Payable and Note 8, Related Party Transactions ), convertible notes, and the sale of common stock.

Pursuant to the Secured SPA, the Unsecured SPA, the Unsecured Streeterville SPA, the FFVV Joinder, and the Senyun Joinder (collectively the “SPA Commitments”) (see Note 7, Notes Payable and Note 8, Related Party Transactions ), the Company obtained commitments from several investors.

As of September 30, 2024, the SPA Commitments totaled $ 554.5 million, of which $ 365.3 million was funded, $ 189.2 million remained to be funded, and $ 38.7 million in principal was outstanding.

As of September 30, 2024, Optional Commitments under the SPA Commitments totaled $ 366.0 million, of which $ 48.4 million was funded, $ 317.6 million remained to be funded, and $ 10.4 million was outstanding.

The remaining amounts to be funded as of September 30, 2024, are subject to the achievement of delivery milestones, satisfaction of closing conditions, and satisfaction or waiver of other conditions.

Accordingly, the Unaudited Condensed Consolidated Financial Statements have been prepared on a basis that assumes the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

Capital Investment, SPA Portfolio Debt, and Future Equity Plans

The Company has and will continue to devote subs tantial effort and, to the extent available, capital resources, to strategic planning, engineering, design, and development of its electric vehicle platform, development of vehicle models, finalizing the build out of the FF ieFactory California manufacturing facility, and capital raising.

The Company incurred cumulative losses from operations, negative cash flows from operating activities, and has an accumulated deficit of $ 4,324.6 million, an unrestricted cash balance of $ 9.5 million and a negative working capital position of $ 112.3 million as of March 31, 2025.

The Company delivered its first vehicles during 2023 and plans to launch its FX Series of vehicles, but expects to continue to generate significant operating losses for the foreseeable future.

The Company has funded its operations and capital needs primarily through the issuance of notes payable and related party notes payable convertible notes (see Note 7, Notes Payable and Note 8, Related Party Transactions ), and the sale of common stock.

Debt Commitments under SPA Portfolio Notes and Other Notes

SPA Portfolio Notes :

The Company has issued various financing arrangements collectively known as the SPA Portfolio Notes.

These are categorized as follows:

(i) Secured SPA Notes;

(ii) 2023 Unsecured SPA Notes;

(iii) Junior Secured SPA Notes;

(iv) 2024 Unsecured SPA Notes and (v) 2025 March Unsecured SPA Notes.

As of March 31, 2025, the SPA Portfolio Notes were in good standing.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company may be unable to satisfy the closing conditions under the SPA Commitments or obtain additional incremental convertible senior secured note purchasers under the SPA Commitments or other debt or equity financing in a timely manner, on acceptable terms, or at all.

On September 5, 2024, the Company entered into another Securities Purchase Agreement (the “Junior Secured SPA”) with certain institutional investors as purchasers (the “Junior Secured SPA Investors”).

Pursuant to the Junior Secured SPA, the Junior Secured SPA Investors agreed to purchase certain secured promissory notes (the “Junior Secured SPA Notes”), warrants, and incremental warrants for approximately $ 30.0 million, of which $ 22.5 million was paid in cash and approximately $ 7.5 million was converted from a previous loan to the Company, in two closings.

As of September 30, 2024, the Company had received $ 20.8 million of the commitments, and the remaining commitments were received by October 30, 2024.

Additionally, the Junior Secured SPA Investors were given an incremental warrant to purchase additional Junior Secured SPA Notes, up to amounts originally funded (the “Incremental Warrants”), at the same terms and conditions as the original Junior Secured SPA commitments.

The Incremental Warrants are exercisable immediately, entirely at the option of the holder, with a term of one year, to purchase the additional Junior Secured SPA Notes at an exercise price equal to the principal amount of the Junior Secured SPA Notes issued to the Junior Secured SPA Investor.

On November 11, 2022, the Company entered into a three-year Standby Equity Purchase Agreement (the “SEPA”) with YA II PN Ltd.

(“Yorkville”).

Under terms of the SEPA, the Company may, at its option, issue and sell from time to time up to $ 200.0 million (which can be increased up to $ 350.0 million in the aggregate under the Company’s option) of Class A Common Stock to an affiliate of Yorkville Advisors, subject to certain limitations.

As of September 30, 2024, the Company had the right to issue and sell up to an additional $ 192.5 million , or $ 342.5 million if the Company exercises its option under the SEPA, of Class A Common Stock under the SEPA.

In addition, on September 26, 2023, the Company entered into a sales agreement with Stifel, Nicolaus & Company, Incorporated, B.

Pursuant to the SPA Portfolio Notes commitments (collectively the “SPA Commitments”) (see Note 7, Notes Payable and Note 8, Related Party Transactions ), the Company obtained commitments from several investors.

As of March 31, 2025, the SPA Commitments totaled $ 655.5 million, of which $ 427.7 million was funded, $ 227.8 million remained to be funded, and $ 48.3 million in principal was outstanding.

On March 31, 2025, Optional Commitments under the SPA Commitments totaled $ 467.0 million, of which $ 50.9 million was funded, $ 386.1 million remained to be funded, and $ 2.5 million was outstanding.

The remaining amounts to be funded as of March 31, 2025, are subject to the achievement of delivery milestones, satisfaction of closing conditions, certain of which include minimum share price requirements, resolving disputes with investors, and satisfaction or waiver of other conditions, including for a portion of such financing an effective registration statement for the shares underlying the applicable notes.

Other Financing Arrangements and Related Party Notes:

Additional financing is provided via convertible debt instruments, equipment financing arrangements, and related party notes that support the Company’s operations and capital expenditures.

As of March 31, 2025, the Company was in good standing on all of its other financing arrangements and Related Party Notes.

The Company may be unable to satisfy the closing conditions under the SPA Commitments or obt ain additional incremental investors under the SPA Commitments or other debt or equity financing in a timely manner, on acceptable terms, or at all.

Standby Equity Purchase Agreement, At-The-Market Offerin g , and Equity Issuance Constraints

The Company has implemented a series of financing arrangements, including a Standby Equity Purchase Agreement with Yorkville and an At-The-Market offering.

These initiatives are accompanied by equity issuance constraints, such as limitations imposed by authorized share counts and the impact of convertible securities and related provisions.

Together, these elements define the Company’s approach to capital raising and its management of associated regulatory and contractual obligations .

Standby Equity Purchase Agreement (“SEPA”)

On November 11, 2022, the Company entered into the SEPA, which expires in November 2025.

Under the terms of the SEPA, the Company may, at its option, issue and sell from time to time up to $ 200.0 million (which can be increased up to $ 350.0 million in the aggregate under the Company’s option) of Class A Common Stock to YA II PN Ltd.

(“Yorkville”) , subject to certain limitations.

As of March 31, 2025, the Company had the right to issue and sell up to an additional $ 192.5 million, or $ 342.5 million if the Company exercises its option under the SEPA.

At-The-Market Offerin g

On September 26, 2023, the Company entered into a sales agreement with Stifel, Nicolaus & Company, Incorporated, B.

Riley Securities, Inc., A.G.P./Alliance Global Partners, Wedbush Securities Inc.

and Maxim Group LLC, as sales agents, to sell shares of Class A Common Stock, from time to time, with aggregate gross sales proceeds of up to $ 90.0 million pursuant to the Registration Statement as an “at-the-market” offering under the Securities Act (the “ATM Program”).

The ATM Program was the primary source of liquidity for the Company during the period from September 2023 through December 2023.

Under applicable SEC rules and regulations, because FF failed to timely file its Form 10-K and the Quarterly Report Form 10-Q for the quarter ended March 31, 2024, the Company is not eligible to use the S-3 registration process, which restricts its ability to raise capital through that streamlined method of offering securities and cannot access the ATM Program.

As such, the Company’s current primary source of liquidity is the issuance of various convertible note instruments.

The Company’s ability to issue and sell additional shares of common stock or warrants under the SEPA and ATM Program is constrained by the number of authorized shares of the Company’s common stock.

The Company must consider shares issuable under convertible debt, warrants or other obligations with equity rights.

In addition, equity issuances can potentially trigger provisions under the SPA Commitments and Junior Secured SPA Notes that increase the number of shares to be issued upon conversion and reduce the strike price of related warrants.

This could result in FF having inadequate authorized shares to meet its outstanding commitments.

The Company projects that it will require substantial additional funds to continue operations and support production of the FF 91.

If the Company is unable to find additional sources of capital, the Company will not have sufficient resources to fund its outstanding obligations and continue operations and the Company will likely have to file for bankruptcy protection and its assets will likely be liquidated.

The Company’s equity holders would likely not receive any recovery at all in a bankruptcy scenario.

Under applicable SEC rules and regulations, because the Company failed to timely file its Form 10-K for the year ended December 31, 2023, as well as its Form 10-Q for the quarter ended March 31, 2024, the Company will not be eligible to access the ATM Program until August 1, 2025, at the earliest.

Equity Issuance Constraints

The Company’s ability to issue and sell additional shares of Common Stock or warrants to support ongoing capital needs is further constrained by the number of authorized shares.

In addition to outstanding shares, the Company must also consider shares reserved for issuance under convertible debt, warrants or other obligations with equity rights.

In addition, equity issuances can potentially trigger various anti-dilution features in the Company’s debt and equity instruments that increase the number of shares to be issued and/or reduce the exercise price.

This could result in the Company having inadequate authorized shares to meet its outstanding commitments.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Capital Needs, FX Series Production, and Bankruptcy Risk

The Company projects that it will require substantial additional funds to continue operations and support production of the FF 91, and it also plans to initiate production of its FX Series of vehicles.

If additional capital is not secured, the Company will not have sufficient resources to meet its obligations and continue operations, which could result in bankruptcy protection and asset liquidation, with equity holders receiving little to no recovery.

The anticipated start of FX Series production is expected to generate new revenue streams and enhance operational performance, partially mitigating near-term cash flow pressures;

however, if additional capital is not secured, the Company will not have sufficient resources to meet its obligations or continue operations, potentially resulting in bankruptcy protection, asset liquidation, and minimal or no recovery for equity holders.

Funding Alternatives and Risks

The Company continues to explore various funding and financing alternatives to fund its ongoing operations and to ramp up production.

3 unchanged sentences

While the Company is actively engaged in negotiations with potential financing sources, it may be unable to raise additional capital on terms acceptable to it or at all.

In addition to the risk that the Company’s assumptions and analyses may

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Notes to Unaudited Condensed Consolidated Financial Statements

prove incorrect, the projections may underestimate the professional fees and other costs to be incurred related to the pursuit of various financing options currently being considered and ongoing legal risks.

Capital needs to fund development of the Company’s remaining product portfolio will highly depend on the market success and profitability of the FF 91 and the Company’s ability to accurately estimate and control costs.

Apart from the FF 91 series, substantial additional capital would be required to fund operations, research, development, and design efforts for future vehicles.

Since April 2023, the Company has been in default on, and since January 1, 2024, it has been in breach of, its debt agreement with Chongqing Leshi Small Loan Co., Ltd., a related party, with an outstanding principal balance of $ 7.7 million and interest payable of $ 20.0 million as of September 30, 2024.

During 2024, the Company was also in default on its Unsecured Convertible Note obligations and various related party notes (see Note 7, Notes Payable and Note 8, Related Party Transactions ).

Due to the cross default provisions of the SPA Notes and Junior Secured SPA Notes, the Company was and has been in default on the SPA and Junior Secured Commitments and the Company is presenting the related notes as current.

In addition to the risk that the Company’s assumptions and analyses may prove incorrect, the projections may underestimate the professional fees and other costs to be incurred related to the pursuit of various financing options currently being considered and ongoing legal risks.

Capital needed to fund the development of the Company’s remaining product portfolio will largely depend on market success and profitability of the FF 91 and the launch of the FX series, and the Company’s ability to accurately estimate and control costs.

Apart from the FF 91 series and FX series, substantial additional capital would be required to fund operations, research, development, and design efforts for future vehicles.

In addition, elevated U.S.

import tariffs on electric vehicle components sourced from China could increase the Company's future manufacturing costs as production of the FX Series and other future vehicle models are introduced.

While tariffs did not materially impact cost of goods sold for the three months ended March 31, 2025, due to limited production volume, continued reliance on China-based suppliers may contribute to higher input costs, pressure gross margins, and increase the Company's future funding needs.

Going Concern and Future Capital Strategy

Despite the Company’s diversified financing structure – including its SPA Portfolio Notes, convertible debt instruments, and equipment financing, and targeted inflows from new debt, and anticipated equity, the Company’s recurring operating losses and continuing negative cash flows from operations continue to raise substantial doubt about the Company’s ability to continue as a going concern.

Inventory, net

(in thousands) September 30, 2024 December 31, 2023

Inventory, net, consists of the following as of:

(in thousands) March 31, 2025 December 31, 2024

Raw materials (net of reserves) $ 26,773 $ 27,440

1 unchanged sentence

Finished goods 199 —

Total inventory $ 27,280 $ 34,229

The inventory reserve was $ 2.8 million for each of the periods ended September 30, 2024 and December 31, 2023 .

$ 27,124 $ 27,486

The inventory reserve was $ 3.3 million and $ 3.3 million as of March 31, 2025 and December 31, 2024 , respectively.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Deposits and Other Current Assets

(in thousands)

September 30, 2024 December 31, 2023

Deposits for research and development, prototype parts and other $ 27,106 $ 28,609

Deposits and other current assets consists of the following as of:

(in thousands) March 31, 2025 December 31, 2024

Deposits for research and development, prototype and production parts, and other $ 32,143 $ 29,318

Deposits for goods and services yet to be received (“Future Work”) 1,776 1,776

Total deposits $ 29,866 $ 31,382

Other current assets:

$ 33,919 $ 31,094

Other current assets March 31, 2025 December 31, 2024

Prepaid expenses $ 4,022 $ 4,832

Other current assets 1,249 $ 1,295

Total other current assets $ 15,190 $ 21,721

Deposits for research and development, prototype and production parts, and other are recognized and reported as Research and development expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss when services are provided or as prototype parts are received.

In addition, during the nine months ended September 30, 2024, the Company made deposits for inventory and property, plant and equipment items, which are classified out of Deposits upon receipt of title.

$ 5,271 $ 6,127

Deposits for R&D, prototype and production parts, and other are recognized and reported as R&D expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss when services are provided or as prototype parts are received.

In addition, during the three months ended March 31, 2025 and 2024, the Company made deposits for inventory and property and equipment items which are classified as Deposits for goods and services yet to be received (“Future Work”).

Prepaid expenses primarily consist of software subscriptions and insurance, and Other current assets includes certain deferred expenses.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Property, Plant, and Equipment, Net

(in thousands) September 30, 2024 December 31, 2023

Property, plant, and equipment, net, consists of the following as of:

(in thousands)

March 31, 2025 December 31, 2024

Land, buildings and leasehold improvements $ 112,150 $ 111,443

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Construction in process 28,797 27,563

Total property, plant and equipment 462,863 467,352

468,501 468,421

Accumulated depreciation ( 137,036 ) ( 119,834 )

Total property, plant and equipment, net $ 360,063 $ 417,812

Depreciation and amortization expense totaled $ 17.5 million and $ 13.2 million for the three months ended September 30, 2024 and 2023, respectively, and $ 53.3 million and $ 27.5 million for the nine months ended September 30, 2024 and 2023, respectively.

Due to the build out of the FF ieFactory California, the Company has an asset retirement obligation (“ARO”) totaling $ 0.8 million and $ 0.7 million for the periods ended September 30, 2024 and December 31, 2023, respectively.

The ARO is recorded to Other liability, less current portion with a corresponding ARO asset within Land, buildings and leasehold improvements and Tooling, machinery and equipment.

$ 331,465 $ 348,587

The Company’s CIP is primarily related to the construction of tooling, machinery and equipment for the FF ieFactory California.

Tooling, machinery, and equi pment are either held at Company facilities, primarily the FF ieFactory California, or at the vendor’s location until the tooling, machinery and equipment is completed.

Depreciation and amortization expe nse totale d $ 17.5 million and $ 17.7 million for the three months ended March 31, 2025 and 2024, respectively.

For the three months ended March 31, 2025, the Company recognized a $ 44 thousand loss on disposal of property, plant, and equipment, which included the derecognition of approximately $ 0.2 million in accumulated depreciation.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Asset Retirement Obligation

Due to the build out of the FF ieFactory California, the Company has an asset retirement obligation (“ARO”) totaling $ 0.8 million and $ 0.8 million as of March 31, 2025 and December 31, 2024, respectively.

The ARO is recorded to Other liabilities with a corresponding ARO asset within Land, buildings and leasehold improvements and Tooling, machinery, and equipment.

The ARO asset is depreciated to operating expense over the remaining term of the lease through December 2027.

Accrued Expenses and Other Current Liabilities

(in thousands) September 30, 2024 December 31, 2023

Accrued expenses and other current liabilities—which include both third-party and related-party balances—comprise the following items as of:

(in thousands)

March 31, 2025 December 31, 2024

Accrued payroll and benefits $ 28,859 $ 27,713

Accrued legal contingencies 6,615 9,091

Customer deposits 3,003 3,027

Other current liabilities 23,015 16,923

Total accrued expenses and other current liabilities $ 59,391 $ 62,391

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

$ 61,492 $ 56,754

Notes Payable

The Company has entered into notes payable agreements with third parties, which consist of the following as of September 30, 2024 and December 31, 2023:

September 30, 2024

The Company has entered into notes payable agreements with third parties.

The tables below summarize these agreements as of March 31, 2025 and December 31, 2024, providing details on contractual maturity dates, contractual interest rates, unpaid principal balances, fair value adjustments, original issue discounts, including proceeds allocated to warrants, and net carrying values.

March 31, 2025

(in thousands) Contractual

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Secured SPA Notes Various 10 % - 15 % $ 2,500 $ 139 $ ( 250 ) $ 2,389

$ 26,336 $ ( 4,146 ) $ ( 1,976 ) $ 20,214

Unsecured SPA Notes *

Various dates in 2029 10 %- 15 %

22,802 398 ( 2,350 ) 20,850

Junior Secured Notes September 2029 10 % 20,769 ( 11,341 ) — 9,428

Collateralized loan October 2028 28 % 4,805 — ( 419 ) 4,386

Junior Secured SPA Notes September 2029 10 % 13,431 55 ( 7,426 ) 6,060

2024 Unsecured SPA Notes Various through January 2030 10 % 30,015 12,279 ( 30,964 ) 11,330

2025 March Unsecured SPA Notes April 2030 10 % 2,000 ( 44 ) ( 1,193 ) 763

Notes payable – China other

Due on Demand — % 4,132 — — 4,132

Auto loans October 2026 7 % 58 — — 58

$ 52,078 $ 12,429 $ ( 39,833 ) $ 24,674

Notes payable, current portion $ 4,132

Notes payable, less current portion $ 3,800

Notes payable, long-term portion $ 20,542

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

December 31, 2024

5 unchanged sentences

Secured SPA Notes Various 10 % - 15 % $ 3,118 $ 2,651 $ ( 312 ) $ 5,457

$ 100,052 $ ( 15,501 ) $ ( 10,319 ) $ 74,232

Unsecured SPA Notes *

Various dates in 2029 10 %- 15 %

13,885 1,208 ( 2,613 ) 12,480

2023 Unsecured SPA Notes Various dates in 2029 10 % - 15 % 4,380 2,844 ( 508 ) 6,716

Junior Secured SPA Notes September 2029 10 % 28,840 13,163 ( 15,944 ) 26,059

2024 Unsecured SPA Notes December 2029 10 % 10,015 8,741 ( 11,724 ) 7,032

Notes payable – China other

2 unchanged sentences

$ 50,577 $ 27,399 $ ( 28,488 ) $ 49,488

Related party notes payable ( 542 )

Notes payable, current portion $ 4,224

Notes payable, less current portion $ —

* includes amounts attributed to the Unsecured Streeterville SPA

Secured and Unsecured SPA Notes

On August 14, 2022, the Company entered into a securities purchase agreement (as amended from time to time, the “Secured SPA”) with FF Simplicity Ventures LLC (“FFSV”) as administrative agent, collateral agent and purchaser, and certain additional purchasers (collectively the “Secured SPA Purchasers”) to issue and sell the Company’s senior secured convertible notes (the “Secured SPA Notes”).

The Secured SPA Notes were subsequently amended multiple times throughout 2022 and 2023, as further described below.

On May 8, 2023, as further described below, the Company entered into a securities purchase agreement (as amended from time to time, the “Unsecured SPA”) with Metaverse Horizon Limited (“MHL”) and V W Investment Holding Limited (“V W Investment”) (MHL and V W Investment, together with the other purchasers, the “Unsecured SPA Purchasers”) to issue and sell $ 100.0 million aggregate principal of the Company’s senior unsecured convertible notes (the “Unsecured SPA Notes” and, together with the Secured SPA Notes, the “SPA Notes”).

In August 2023, as further described below, the Company entered into the Unsecured Streeterville SPA (collectively included with the Unsecured SPA, Unsecured SPA Notes and SPA Warrants in

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

future references), as part of its issuance of the Unsecured SPA Notes.

The terms of the Secured SPA Notes and Unsecured SPA Notes are generally the same, however, the Secured SPA Notes are secured by the grant of a second lien upon substantially all of the personal and real property of the Company and its subsidiaries, as well as a guarantee by substantially all of the Company’s domestic subsidiaries.

The SPA Notes are generally subject to an original issue discount of 10 %, and are convertible, along with any interest accrued, into shares of Class A Common Stock at the conversion price (as defined in each SPA Note), subject to full ratchet anti-dilution price protection.

The SPA Note conversion price equals the lesser of $ 5.24 or 90 % of the volume-weighted average price (“VWAP”) of the common stock as of the previous trading day, which represents an amended, restated and reduced conversion price due to the full ratchet price protections.

The SPA Notes bear interest at 10 % per annum (or 15 % if interest or settlement is paid in shares).

Generally, the SPA Notes require interest to be paid at maturity in cash or in shares of Class A Common Stock.

Generally, the Secured and Unsecured SPA Purchasers have the option to purchase additional SPA Notes under similar terms as the existing SPA Notes, subject to various closing conditions (see Note 2, Liquidity and Capital Resources and Going Concern , for detailed discussion on commitments to fund additional Secured SPA Notes).

In connection with the issuance of the SPA Notes, the Company also granted to each Secured SPA Purchaser and Unsecured SPA Purchaser a warrant (the “SPA Warrants”) to purchase shares of Class A Common Stock equal to 33 % of the shares issuable upon conversion of the aggregate principal amount under the SPA Notes funded.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the SPA Notes because the notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

The Company expenses transaction costs to Changes in fair value of notes payable and warrant liabilities or Changes in fair value of related party notes payable and warrant liabilities, as applicable, in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Initial Issuance

On August 2, 2024, the Company and the remaining holders of the SPA Notes entered into a Waiver Agreement (the “Waiver Agreement”), as more fully described below.

The Waiver Agreement materially changed the conversion privileges of the SPA Notes.

Prior to the parties entering into the Waiver Agreement, the principal balance of the SPA Notes converted into Class A Common Stock at a fixed price of $ 29.33 , which represented an amended, restated and reduced conversion price due to the full ratchet price protections.

The SPA Notes generally required interest to be paid on each conversion date and quarterly in cash or in shares of Class A Common Stock.

Certain Unsecured and Secured SPA Notes required the payment of interest in cash or shares of Class A Common Stock at maturity.

Unless earlier paid, the SPA Notes entitled the purchasers, at each conversion date, to an interest make-whole (a “Make-Whole Amount”), in a combination of cash or Class A Common Stock, at the Company’s discretion, in the amount of the interest that would have been payable if such converted amount was held to maturity.

The conversion price for the Make-Whole Amount was generally the greater of (a) the floor price, which was $ 435.84 immediately prior to the Waiver Agreement or (b) 90 % of the lowest VWAP for the five consecutive trading days ending immediately prior to the conversion date.

Certain Secured SPA Notes required the Interest Conversion Price to be the lesser of (1) the principal balance conversion price or (2) the greater of (a) the floor price, which was $ 435.84 or (b) 90 % of the lowest VWAP for the five consecutive trading days ending immediately prior to the conversion date.

When calculating the shares issuable upon conversion, the Make-Whole Amount was decreased by 50 % of the original issue discount pertaining to such amount.

Sixth Secured SPA Amendment

On February 3, 2023, the Company entered into a sixth amendment to the Secured SPA (the “Sixth Secured SPA Amendment”) with certain Secured SPA Purchasers, in which the Company agreed to sell up to $ 135.0 million in aggregate principal (the “Tranche C Notes”) with terms largely congruent to prior issuances and a $ 10,080.00 base conversion price subject to full ratchet anti-dilution price protection.

Each applicable Secured SPA Purchaser had the option to purchase additional Secured SPA Notes on the same terms as the Tranche C Notes in an amount not to exceed 50 % of the initial principal amount of the Tranche C Notes issued to each applicable Secured SPA Purchaser (the “Tranche D Notes”).

Pursuant to the Sixth Secured SPA Amendment, certain outstanding Secured SPA Notes issued by the Company to Secured SPA Purchasers with an aggregate outstanding principal amount of $ 31.0 million were replaced by the same principal

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

amount of new notes with a $ 8,568.00 base conversion price.

In accordance with ASC 470-50, Debt—Modifications and Extinguishments , the change in conversion price qualified as an extinguishment because the change in the fair value of the conversion feature was substantial.

Accordingly, the Company recognized a Loss on settlement of notes payable in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss in the amount of $ 3.0 million during the three months ended March 31, 2023, calculated as the difference between the reacquisition price of the debt and the net carrying amount of the Secured SPA Notes.

Pursuant to the Sixth Secured SPA Amendment, the Company entered into an agreement with certain Secured SPA Purchasers (the “Exchange Agreement”) holding a total of 20,639 warrants to exchange them for an aggregate 9,426 warrants and convertible notes (the “Exchange Notes”) with a principal balance totaling $ 41.0 million.

The issued warrants have terms that limit down-round ratchet clauses to price adjustments only.

The Exchange Notes mature on February 3, 2025, bear interest at 11 % per annum, have no original issuance discount, do not have a fixed price conversion, and convert using a VWAP calculation as described in the Exchange Agreement.

The remainder of the terms of the Exchange Notes are largely congruent to the existing Secured SPA Notes, including most-favored nation rights.

In connection with the Exchange Agreement, equity-classified warrants were exchanged for warrants that qualify for liability classification per ASC 480, Distinguishing Liabilities from Equity , and were reclassified from equity to Warrant liabilities during the period ended September 30, 2023 in an amount totaling $ 6.8 million (the “Warrant Exchange”).

As a result of the transaction, the Company did not recognize a gain or loss in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, as the fair value of the instruments exchanged and received were approximately the same.

Seventh Secured SPA Amendment

On March 23, 2023, the Company entered into a seventh amendment to the Secured SPA (the “Seventh Secured SPA Amendment”) with FFSV, as administrative agent, collateral agent and purchaser, Senyun International Ltd.

(“Senyun”), and FF Prosperity Ventures LLC (“FF Prosperity”), pursuant to which the parties agreed to accelerate the funding timeline of Tranche C Notes in the amount of $ 40.0 million, and FFSV agreed to purchase additional Tranche B Notes in the amount of $ 5.0 million, in each case, subject to meeting certain conditions, in exchange for an agreement to increase the original issuance discount associated with such funding.

As part of the Seventh Secured SPA Amendment, the Company agreed that the original issuance discount related to $ 25.0 million in principal amount of Tranche C Notes and Tranche B Notes would be 14 % and 16 %, respectively.

Eighth Secured SPA Amendment

On May 8 and 9, 2023, the Company entered into amendments to the Secured SPA (collectively, the “Eighth Secured SPA Amendment”) with certain Secured SPA Purchasers.

Pursuant to the Eighth Secured SPA Amendment, the parties agreed to amend the floor price of all outstanding Secured SPA Notes, including the Exchange Notes, from $ 2,016.00 to $ 960.00 and changed the exercise price of the remaining Secured SPA Notes and SPA Warrants from $ 10,080.00 to $ 8,568.00 .

Accordingly, the Company recognized a Loss on settlement of notes payable in the Consolidated Statements of Operations and Comprehensive Loss during the three and nine months ended September 30, 2023 in the amount of $ 11.4 million, calculated as the difference between the reacquisition price of the debt and the net carrying amount of the notes.

Unsecured SPA

On May 8, 2023, the Company entered into the Unsecured SPA.

The Unsecured SPA Notes were subject to an original issue discount of 10 % and were convertible into shares of Class A Common Stock at an original fixed conversion price equal to $ 8,568.00 , subject to anti-dilution protection.

Interest on Unsecured SPA Notes was payable at conversion or at maturity.

When calculating the shares issuable upon conversion, the converted amount was decreased by 50 % of the original issue discount pertaining to such amount.

Unless earlier paid, the Unsecured SPA Notes entitled the Unsecured SPA Purchasers, at each conversion date, to a Make-Whole Amount, in a combination of cash or Class A Common Stock at the Company’s discretion, in the amount of the interest that would have been payable if such converted amount was held to maturity based on an interest rate of 15 % per annum.

The conversion price of interest was the greater of (a) the floor price, $ 960.00 at inception (as adjusted for stock splits,

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

stock dividends, stock combinations, recapitalizations or other similar transactions occurring after the date of this Form 10-Q) and (b) 90 % of the lowest VWAP for the five consecutive trading days ending immediately prior to the conversion date.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Unsecured SPA Notes because the notes included features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

The Company expenses the transaction costs to Changes in fair value of notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

As part of the Unsecured SPA, the Unsecured SPA Purchasers also received warrants consistent with the rights, terms and privileges of the warrants afforded to the holders of the Secured SPA Notes.

First Unsecured SPA Amendment

On June 26, 2023, the Company entered into an amendment to the Unsecured SPA (the “First Unsecured SPA Amendment”).

The First Unsecured SPA Amendment enabled the Unsecured SPA Purchasers to postpone or cancel any closing of their commitment to purchase the Unsecured SPA Notes if the Company had not issued a press release or other public announcement confirming that the second phase of the Company’s delivery plan had begun on or prior to August 31, 2023, within 15 calendar days of such date.

The First Unsecured SPA Amendment did not change the cash flows of the Unsecured SPA and is accounted for prospectively with no gain or loss recognized.

On August 9, 2023, the Company announced that it had completed the relevant processes and steps that were needed for the second phase of delivery to begin.

Joinder Agreements

On June 26, 2023, the Company entered into a Joinder and Amendment Agreement (the “FFVV Joinder”) with FF Vitality Ventures LLC (“FFVV”), pursuant to which FFVV agreed that FFVV would exercise its option to purchase $ 20.0 million of Secured SPA Tranche B Notes, subject to certain closing conditions, including the delivery of a warrant to purchase shares of Class A Common Stock equal to 33 % of FFSV’s conversion shares with an exercise price equal to $ 8,568.00 .

In addition, the parties agreed that if FFSV exercised its option to invest another $ 10.0 million of Tranche B Notes in accordance with the terms of the Secured SPA on or prior to the later of (x) August 1, 2023 or (y) four business days after the meeting of the Company’s stockholders for the required stockholder approval under the Unsecured SPA to increase the Company’s authorized shares of Common Stock, then the Company would subsequently amend the Unsecured SPA whereby FFVV would invest another $ 20.0 million in new unsecured notes subject to terms substantially identical to those provided in the Unsecured SPA.

Pursuant to the FFVV Joinder, FFVV agreed to purchase Unsecured SPA Notes up to $ 40.0 million in eight installments.

The floor price of the FFVV Unsecured SPA Notes and for each of the notes issued to FFSV (or its affiliates) under the Secured SPA was to be $ 480.00 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions occurring thereafter).

The funding at each closing was subject to various closing conditions, including:

(a) an effective registration statement with respect to (i) the shares of Common Stock issuable upon exercise of the warrants issuable under the Unsecured SPA and (ii) the shares of Common Stock issuable pursuant to the FFVV Unsecured SPA Notes and (b) the Company having reserved the Required Reserve Amount (as defined in the FFVV Joinder) in full.

In addition, FFVV had the option, for 12 months from June 25, 2023, to purchase Unsecured SPA Notes.

FFVV agreed, on behalf of its affiliates, that FFSV may exchange any Tranche B Notes for either (x) Tranche D Notes, and/or (y) any Unsecured SPA Notes.

This option was extended for 12 months from August 2, 2024 in connection with the Waiver Agreement.

The Company agreed to pay FFVV a one-time working fee of $ 0.3 million and legal fees not to exceed $ 0.4 million, which was paid by netting the purchase price of new notes with the amount of such fees.

On June 26, 2023, Senyun executed a Second Joinder and Amendment Agreement (the “Senyun Joinder”), pursuant to which Senyun agreed to exercise its option to purchase $ 15.0 million of Secured SPA Notes in accordance with the terms of the Secured SPA Notes.

If Senyun had exercised its option to invest another $ 10.0 million of Secured SPA Notes in accordance with the terms of the Secured SPA Notes on or prior to the later of (x) August 1, 2023 or (y) four business days after the meeting of the Company’s stockholders for the Stockholder Approval (as defined below), then the Company agreed that it would subsequently amend the Unsecured SPA Notes whereby Senyun would invest another $ 20.0 million.

Senyun did not exercise this latter option.

Pursuant to the Senyun Joinder, Senyun agreed to purchase, under the Unsecured SPA, Unsecured SPA Notes in an aggregate principal amount of up to $ 30.0 million in eight installments.

The floor price for each note issued to Senyun (or its

Notes payable, long-term portion $ 45,264

Roll Forward of the Fair Value of Notes payable by Transaction Type

The following table presents a roll forward of the Company’s Notes payable balances from December 31, 2024 to March 31, 2025 with third parties.

The table summarizes beginning and ending balances by debt category and details changes during the period, including repayments, conversions, reclassifications, fair value adjustments, and other significant transactions.

Categories of Debt

(in thousands) Secured

SPA Notes 2023

SPA Notes Junior

SPA Notes 2024

SPA Notes 2025 March Unsecured SPA Notes Notes

China other Auto

Balance as of December 31, 2024 (a) $ 5,457 $ 6,716 $ 26,059 $ 7,032 $ — $ 4,173 $ 51 $ 49,488

New Issuances (b) — — — 11,096 807 — 11,903

Repayment of Debt (c) — — — — — — ( 6 ) ( 6 )

Conversion of Debt to Equity (d) ( 589 ) ( 4,692 ) ( 9,564 ) — — — — ( 14,845 )

Fair Value Adjustments of Debt (e) ( 2,479 ) ( 2,024 ) ( 10,435 ) ( 6,798 ) ( 44 ) — — ( 21,780 )

Other Adjustments (f) — — — — — ( 41 ) ( 45 ) ( 86 )

Balance as of March 31, 2025 (g) $ 2,389 $ — $ 6,060 $ 11,330 $ 763 $ 4,132 $ — $ 24,674

(a) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2024.

(b) Debt instruments issued during the period, recorded at fair value upon issuance if the fair value option is elected, or at principal balance net of discounts.

For those measured at fair value, the aggregate fair value adjustment at issuance represented a reduction of $ 10,097 thousand to the principal amount of the notes issued during the period, presented as a component of Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

(d) Fair value of debt converted into equity during the period.

(f) Adjustments to debt fair value due to the fair value option election, embedded derivatives, or anti-dilution provisions.

These adjustments are presented as a component of Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

Line item Change in fair value of notes payable, warrant liabilities, and derivative call options also includes debt issuance costs of $ 429 thousand, which are separately identifiable from the fair value adjustments noted above.

(f) Miscellaneous changes not captured in other columns, such as currency adjustments and reclassification to accrued expenses.

(g) The carrying value for each note category, fair value or amortized cost depending on the election, as of March 31, 2025.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

affiliates) under the SPA, was $ 436.00 (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions occurring after the date of this Form 10-Q).

The Company agreed to pay Senyun a one-time working fee of $ 0.2 million and legal fees not to exceed $ 0.3 million, which was paid by netting the purchase price for new notes with the amount of such fees.

The FFVV and Senyun Joinders did not trigger any adjustment to the conversion or exercise price of the notes and warrants under the SPA Notes, and Senyun and FFSV waived any such rights to any adjustment to the conversion or exercise price in each of the Secured SPA and/or the Unsecured SPA, as applicable, and the related warrants.

Amendment to Joinder and Amendment Agreement

On August 4, 2023, the Company entered into a Waiver and Amendment Agreement to the FFVV Joinder, pursuant to which FFVV agreed to waive any and all requirements of the Company to reserve shares of Common Stock for issuance pursuant to the SPA Notes or SPA Warrants and deferred any obligations of the Company to deliver any shares of Common Stock for issuance pursuant to the SPA Notes or SPA Warrants until the earlier of (x) September 30, 2023 and (y) the earlier of (I) the trading day immediately following the date of consummation of a reverse stock split of the Common Stock and (II) the 15th business day after the Company’s receipt of stockholder approval to increase the authorized shares of Common Stock.

Further, if FFVV exercised its option to invest another $ 10.0 million of Tranche B Notes in accordance with the terms of the Secured SPA on or prior to the latest of (x) August 1, 2023, (y) four business days after the meeting of the Company’s stockholders for the required stockholder approval under the Unsecured SPA to increase the Company’s authorized shares of Common Stock and for purposes of Nasdaq Stock Market LLC (“Nasdaq”) Listing Rule 5635 (to the extent needed) (the “Stockholder Approval”), and (z) six business days after the Company filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2023, then FFVV would have the right, at any time prior to the 30th day after the date of consummation of such funding, to invest another $ 20.0 million in Unsecured SPA Notes, subject to terms substantially identical to those provided for in the Unsecured SPA.

FFVV did not exercise this option.

Unsecured Securities Purchase Agreement – Streeterville

On August 4, 2023, the Company entered into a securities purchase agreement with Streeterville (the “Unsecured Streeterville SPA”), for $ 16.5 million aggregate principal amount of the Company’s senior unsecured promissory notes (the “Streeterville Note”) and a common stock purchase warrant (the “Streeterville Warrant”) to purchase up to 636 shares of Common Stock with an exercise price equal to $ 8,568.00 per share, subject to full ratchet anti-dilution price protection and other adjustments, and which are exercisable for seven years on a cash or cashless basis.

The Streeterville Note was subject to an original issue discount of $ 1.5 million.

In addition, the Company paid Streeterville $ 0.2 million to cover Streeterville’s legal fees and other transaction costs incurred in connection with the purchase and sale of the Streeterville Note.

The Streeterville Note was convertible into shares of Class A Common Stock, at an original conversion price equal to $ 8,568.00 , plus an interest make-whole amount as described above for the Unsecured SPA, subject to certain adjustments including full ratchet anti-dilution price protection.

The Streeterville Note matures on August 4, 2029 and is subject to the same repayment conversion and most-favored nation terms and conditions as described above for the Unsecured SPA.

Streeterville has the option, from time to time for 12 months after the date of the Unsecured Streeterville SPA, to purchase up to $ 7.5 million in aggregate (or $ 15.0 million in aggregate with the Company’s consent) in additional convertible senior unsecured notes and warrants on the same terms as the Streeterville Note and the Streeterville Warrant.

This option was extended for 12 months from August 2, 2024 in connection with the Waiver Agreement.

Additionally, from the date of the Unsecured Streeterville SPA until the five-year anniversary of the date of the Unsecured Streeterville SPA, upon any issuance by the Company or any of its subsidiaries of Class A Common Stock or Class A Common Stock equivalents for cash consideration, indebtedness or a combination of units thereof (subject to certain exceptions set forth in the Unsecured Streeterville SPA) (each, a “Subsequent Financing”), if Streeterville owns at least $ 7.5 million principal amount of Streeterville Note (when aggregated with any affiliates of Streeterville), then Streeterville shall have the right to participate in the Subsequent Financing, for up to an amount such that Streeterville’s ownership of the Company remains the same immediately following such Subsequent Financing as its ownership immediately prior to such Subsequent Financing, pursuant to the procedures outlined in the Unsecured Streeterville SPA.

The following table presents a roll forward of the Company’s Notes payable balances from December 31, 2023 to December 31, 2024 with third parties.

Categories of Debt

(in thousands) Secured

SPA Notes 2023

SPA Notes Unsecured

China other Auto

Balance as of December 31, 2023 (a) $ 74,232 $ 11,938 $ — $ 4,898 $ 82 $ 91,150

New Issuances (b) 1,457 — 7,577 — — 9,034

Repayment of Debt, including periodic interest on debt carried at fair value (c) — — — — ( 10 ) ( 10 )

Conversion of Debt to Equity (d) ( 8,683 ) — — — — ( 8,683 )

Fair Value Adjustments of Debt (e) ( 25,118 ) ( 2,888 ) 285 — — ( 27,721 )

Other Adjustments (f) — ( 1 ) — ( 1 )

Balance as of March 31, 2024 (g) $ 41,888 $ 9,050 $ 7,862 $ 4,897 $ 72 $ 63,769

(a) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2023.

(b) Debt instruments issued during the period, recorded at fair value upon issuance if the fair value option is elected, or at principal balance net of discounts.

For those measured at fair value, the aggregate fair value adjustment at issuance represented a reduction of $ 166 thousand to the principal amount of the notes issued during the period, presented as a component of Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

(d) Fair value of debt converted into equity during the period.

(e) Adjustments to debt fair value due to the fair value option election, embedded derivatives, or anti-dilution provisions.

Line item Change in fair value of notes payable, warrant liabilities, and derivative call options also includes debt issuance costs of $ 25 thousand, which are separately identifiable from the fair value adjustments noted above.

(f) Miscellaneous changes not captured in other columns, such as currency adjustments.

(g) The carrying value for each note category, fair value or amortized cost depending on the election, as of March 31, 2024.

Schedule of Principal Maturities of Notes Payable

The future scheduled principal maturities of Notes payable as of March 31, 2025, are as follows:

(in thousands)

Due on demand $ 4,132

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Pursuant to the Streeterville Note, the Company obtained stockholder approval, as required by the Nasdaq listing rules, with respect to the issuance of any shares of Class A Common Stock in excess of 19.99 % of the issued and outstanding shares of Class A Common Stock (the “Issuance Cap”), the Conversion Shares (as defined in the Streeterville Note), the Warrant Shares (as defined in the Unsecured Streeterville SPA), and subject to any applicable Nasdaq rules, any shares of Common Stock issuable pursuant to the note and warrant issuable in connection with the reinvestment right set forth in the Unsecured Streeterville SPA in excess of the Issuance Cap.

Such stockholder approval was obtained at a special meeting of the Company’s stockholders held on February 5, 2024.

The Company has issued various financing arrangements, including secured and unsecured notes, convertible notes, and loans.

These are categorized as follows:

(i) Secured SPA Notes;

(ii) 2023 Unsecured SPA Notes;

(iii) Unsecured Convertible Notes;

(iv) Junior Secured SPA Notes;

(v) 2024 Unsecured SPA Notes;

(vi) 2025 March Unsecured SPA Notes ;

(vii) Notes payable – China other;

and (viii) Auto loans.

Below is a discussion of the terms, amendments, letter agreements, and financial impacts for each category of debt.

Secured SPA Notes

Overview and Terms

Th e Secured SPA Notes were issued under the Secured SPA Agreement dated August 14, 2022, with FF Simplicity Ventures LLC (“FFSV”) acting as administrative agent, collateral agent, and purchaser, along with additional purchasers.

These senior secured convertible notes are supported by a second lien on substantially all of the Company’s assets and are guaranteed by the Company’s domestic subsidiaries.

The Secured SPA Notes bear an annual interest rate of 10 %, increasing to 15 % if interest is paid in shares of Class A Common Stock.

Principal and interest are due at maturity, unless converted earlier pursuant to the Secured SPA Notes’ conversion privileges.

Issued at a 10 % original issue discount, these notes are convertible into Class A Common Stock at the lesser of a fixed conversion price or 90 % of the VWAP for the trading day immediately prior to the conversion date.

The Secured SPA Notes are subject to full ratchet anti-dilution price protection and as of March 31, 2025 the fixed price conversion price was $ 1.16 .

The Secured SPA Notes mature six -years from each date of issuance.

The outstanding Secured SPA Notes, as of March 31, 2025, are scheduled to mature in November 2031.

In connection with the issuance of the Secured SPA Notes, the Company also granted to each purchaser a warrant (the “Secured SPA Warrants”) to purchase shares of Class A Common Stock equal to 33 % of the shares issuable upon conversion of the aggregate principal amount under the Secured SPA Notes funded.

The Secured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the Secured SPA Notes.

The Secured SPA Warrants are indexed to the Company’s Class A Common Stock and, as such, meet the scope exception in ASC 815-40 to be classified within equity.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Secured SPA Notes because the notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

The Company expenses transaction costs to Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

The Company also elected to apply the fair value option for all other SPA Portfolio Notes.

Amendments and Modifications

The Secured SPA Notes have undergone several amendments:

• Unanimous Written Consents:

During the six months ended June 30, 2024, the Company’s Board of Directors exercised its authority via a series of written consents (the “Unanimous Written Consents”) to adjust the principal conversion price of the SPA Notes as it considered desirable.

During the six months ended June 30, 2024, the Company’s Board of Directors (the “Board”) exercised its authority via a series of written consents (the “Unanimous Written Consents”) to adjust the principal conversion price of the Secured SPA Notes as it considered desirable.

The Board chose to reduce the principal conversion price from $ 29.33 to 105 % of the listed market price of the Company’s Common Stock at the close of the trading day on which a conversion notice is delivered.

The adjustments to the principal conversion price were temporary in nature and contractually concluded on June 30, 2024.

The Company accounted for the modification of the SPA Notes prospectively with no gain or loss recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

The actions of the Board in the Unanimous Written Consents did not trigger any full ratchet anti-dilution price protection in the Company’s debt and equity securities.

Amendments No.

11 and 12 to Secured SPA

On July 11, 2024, the Company entered into Amendment No.

11 to the Secured SPA (the “Eleventh Secured SPA Amendment”) with FF Vitality Ventures LLC (the “FF Vitality Purchaser”), as purchaser, and Amendment No.

12 to the Secured SPA (the “Twelfth Secured SPA Amendment”) with Senyun, as purchaser.

Pursuant to the Eleventh and Twelfth Secured SPA Amendments, the Company and the purchasers agreed to amend the restrictions on debt and liens under the Secured SPA Notes to permit the Collateralized Loan (as defined below) and the related liens on the collateral, as described below.

Additionally, the agent for the Secured SPA Notes also agreed to subordinate the liens that secure the obligations under the Secured SPA Notes to the liens on the collateral granted to secure the obligations under the Collateralized Loan.

Since the Eleventh and Twelfth Secured SPA Amendments do not change the contractual cash flows, the Company accounted for the modification of the SPA Notes prospectively with no gain or loss recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Waiver Agreement

On August 2, 2024, the Company entered into the Waiver Agreement with the remaining holders of the SPA Notes.

Prior to the Waiver Agreement, the Company had certain obligations under the SPA Notes to pay accrued and unpaid interest and the Make-Whole Amount in cash or shares in connection with conversions of such SPA Notes.

In an effort to reduce the Company’s ongoing obligations pursuant to the SPA Notes and to encourage the continued conversion of the SPA Notes into shares of Common Stock, the Company entered into the Waiver Agreement, pursuant to which the Company agreed that for each conversion of any SPA Note on or after the effective date of the Waiver Agreement, the conversion price would be the lesser of (1) the conversion price then in effect, $ 29.33 , subject to full ratchet anti-dilution price protection (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions occurring thereafter) or (2) 90 % of the VWAP of the Company’s Common Stock as of the trading day ended immediately prior to the time the conversion notice is delivered to the Company.

Additionally, pursuant to the Waiver Agreement, the holders agreed that accrued interest shall be due at maturity or conversion and that the Make-Whole Amount shall always equal zero , such that instead of receiving all the accrued and unpaid interest due under the SPA Notes through maturity, each holder of any SPA Note will receive, upon conversion or settlement, an amount in cash or shares equal to all accrued and unpaid interest accrued through the settlement date.

The provisions of the Waiver Agreement will apply to all SPA Notes currently issued or issuable in the future pursuant to the Secured SPA and Unsecured SPA.

• Eleventh and Twelfth Amendments (July 11, 2024):

Permitted entry into the Collateralized Loan by subordinating liens securing the Secured SPA Notes to liens under the Collateralized Loan (See Note 9, Other Financing Liabilities , Section Collateralized Loan below).

• The Waiver Agreement (August 2, 2024) :

Revised key financial terms of the Secured SPA Notes and 2023 Unsecured SPA Notes, including elimination of the Make-Whole Amount.

The Make-Whole Amount was a provision that entitled noteholders to compensation for the interest they would have received had the notes been held to maturity.

Additionally, pursuant to the Waiver Agreement, the holders agreed that accrued interest shall be due at maturity or conversion.

Further, the conversion price was reduced to the lesser of (1) the conversion price then in effect, $ 29.33 , subject to full ratchet anti-dilution price protection (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions occurring thereafter) or (2) 90 % of the VWAP of the Company’s Common Stock as of the trading day ended immediately prior to the time the conversion notice is delivered to the

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Further pursuant to the Waiver Agreement, a holder’s right to purchase any additional notes from previous SPA Notes and amendments executed in any agreement with the Company shall be extended until the first anniversary of the effective date of the Waiver Agreement (i.e., until August 2, 2025).

In accordance with ASC 470-50, Debt—Modifications and Extinguishments , the changes pursuant to the Waiver Agreement qualified as an extinguishment because the change in the fair value of the conversion feature was substantial.

Accordingly, the Company recognized a Loss on settlement of notes payable in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss during the three and nine months ended September 30, 2024 in the amount of $ 2.8 million, calculated as the difference between the reacquisition price of the debt and the net carrying amount of the notes.

The provisions of the Waiver Agreement will apply to all Secured SPA Notes and 2023 Unsecured SPA Notes currently issued or issuable in the future pursuant to the Secured SPA Agreement and 2023 Unsecured SPA Agreement.

Anti-Dilution Adjustments

During the twelve-month period ended December 31, 2023, the Company entered into multiple dilutive stock sale and purchase transactions, as discussed in Note 2, Liquidity and Capital Resources and Going Concern above that triggered the full ratchet anti-dilution price protections embedded in the SPA Notes and SPA Warrants.

As a result, the fixed-price conversion price of the SPA Notes and exercise price of the SPA Warrants outstanding prior to such financings was reduced to a price equal to the price per share paid in the dilutive financings.

Excluding the impact of the Conversion Price adjustments pursuant to the Unanimous Written Consents, which expired on June 30, 2024 , the SPA Note conversion and SPA Warrant exercise price was $ 29.33 for SPA Notes that were i ssued prior to December 31, 2023 and generally, the Make-Whole Amount was calculated using the floor price, which was $ 435.84 .

On September 5, 2024, the Company entered into the Junior Secured SPA.

At issuance, the Junior Secured SPA Note conversion price equals the lesser of the stated conversion price, $ 5.24 , or the greater of (1) the floor price, $ 1.05 , or (2) the average VWAP of the common stock for the five previous trading days.

The issuance of the Junior Secured SPA Note constituted a dilutive issuance, as the stated conversion price of $ 5.24 was less than the SPA Note conversion price and the SPA Warrant exercise price.

Therefore, the issuance of the Junior Secured SPA Note triggered the full ratchet anti-dilution price protection in the SPA Notes and SPA Warrants, such that the fixed exercise price was reduced to $ 5.24 .

End of Period Secured and Unsecured SPA Information

During the nine months ended September 30, 2024, the Company received cash proceeds, net of original issue discounts, of $ 8.5 million pursuant to the commitments included in the SPA Notes.

The Company received cash proceeds, net of original issue discounts, of $ 231.1 million in exchange for the issuance of the SPA Notes during the twelve months ended December 31, 2023.

The Company incurred approximately $ 0.1 million and $ 0.2 million in transaction costs during the three and nine months ended September 30, 2024.

The Company incurred zero and approximately $ 2.5 million in related transaction costs during the three and nine months ended September 30, 2023.

During the nine months ended September 30, 2024, and the twelve months ended December 31, 2023, the Company issued SPA Warrants to the Secured SPA Purchasers and Unsecured SPA Purchasers pursuant to both the Secured SPA and Unsecured SPA arrangements and in connection with the Warrant Exchange.

As of September 30, 2024, there were 15,143 SPA Warrants outstanding and as of December 31, 2023, there were 13,906 SPA Warrants outstanding.

The SPA Warrants are subject to anti-dilution ratchet price protection and are exercisable for 7 years from the date of issuance (see Note 11, Stockholders’ Equity ).

The Company may repurchase certain warrants for $ 0.01 per share if and to the extent the VWAP of the Class A Common Stock during 20 out of 30 consecutive trading days prior to the repurchase is greater than $ 144,000.00 per share, subject to certain additional conditions.

There were no SPA Warrant exercises during the three or nine months ended September 30, 2024.

During the twelve months ended December 31, 2023, the Secured SPA Purchasers exercised warrants to purchase 6,292 shares of Class A Common Stock issued pursuant to the SPA Notes, via both cash and cashless exercise.

On September 30, 2024 and 2023, the Company determined that the fair value of the SPA Notes was $ 41.1 million and $ 95.4 million, respectively.

The fair value of the SPA Warrants on September 30, 2023 was $ 1.7 million.

As of September 30, 2024, no SPA Warrants were classified as liabilities.

The Company recorded a gain in Change in fair value of notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss in the amount of $ 10.9 million and $ 56.7 million for the three and nine months ended September 30, 2024, respectively, for the SPA Notes and SPA Warrants.

The Company recorded a gain in Change in fair value of notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2023 in the amount of $ 22.3 million and $ 95.1 million, respectively, for the SPA Notes and SPA Warrants.

During the year ended December 31, 2024 , the Company entered into dilutive stock sale and purchase transactions, that triggered the full ratchet anti-dilution price protections embedded in the Secured SPA Notes and Secured SPA Warrants.

As a result, the fixed-price conversion price of the Secured SPA Notes and exercise price of the Secured SPA Warrants outstanding prior to such financings was reduced to a price equal to the price per share paid in the dilutive financings.

On September 5, 2024, the Company entered into the Junior Secured SPA Agreement, which triggered the full ratchet anti-dilution price protection in the Secured SPA Notes and Secured SPA Warrants.

The issuance of the Junior Secured SPA Notes constituted a dilutive issuance, as the stated conversion price of $ 5.24 was less than the Secured SPA Notes and Secured SPA Warrant exercise price.

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the Secured SPA Notes and Secured SPA Warrant.

The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $ 1.16 was less than the Secured SPA Notes conversion price and Secured SPA Warrant exercise price.

During the three months ended March 31, 2025 there have not been any dilutive stock sale and purchase transactions.

Summary of Secured SPA Notes Activity

As of March 31, 2025, the fair value of the Secured SPA Notes was $ 2.4 million, compared to $ 5.5 million as of December 31, 2024.

During the three months ended March 31, 2025, the Company did not receive cash proceeds or incur transaction costs, in exchange for the issuance of the Secured SPA Notes.

The Company converted debt with a principal amount of $ 0.6 million into 602,902 shares of the Company’s Class A Common Stock.

The conversion of Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $ 0.3 million.

For the three months ended March 31, 2025, the Company recognized $ 2.5 million gain from fair value remeasurement of Secured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

During the three months ended March 31, 2024, the Company received cash proceeds, net of original issue discounts of $ 1.5 million in exchange for the issuance of the Secured SPA Notes and incurred approximately $ 0.0 million in transaction costs.

The Company converted debt with a principal amount of $ 18.3 million into 2,937,946 shares of the Company’s Class A Common Stock.

The conversion of Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $ 11.4 million.

For the three months ended March 31, 2024, the Company recognized $ 25.1 million gain from fair value remeasurement of Secured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

2023 Unsecured SPA Notes

Overview and Terms

The 2023 Unsecured SPA Notes were issued under the Unsecured SPA Agreement dated May 8, 2023, with various investors including Metaverse Horizon Limited (“MHL”), a related party.

These notes are unsecured and have terms similar to the Secured SPA Notes, except they lack collateral backing.

The 2023 Unsecured SPA Notes bear an annual interest rate of 10 %, increasing to 15 %, if interest is paid in shares of Class A Common Stock.

Principal and interest are due at maturity, unless converted earlier pursuant to the 2023 Unsecured SPA Notes’ conversion privileges.

Issued at a 10 % original issue discount, these notes are convertible into the Company’s Class A Common Stock at the lesser of a fixed conversion price or 90 % of the VWAP for the trading day immediately prior to the conversion date.

The 2023 Unsecured SPA Notes are subject to full ratchet anti-dilution price protection and as of March 31, 2025 the fixed price conversion price was $ 1.16 .

The 2023 Unsecured SPA Notes mature primarily six -years from each date of issuance.

There were no outstanding 2023 Unsecured SPA Notes, as of March 31, 2025 .

In connection with the issuance of the 2023 Unsecured SPA Notes, the Company also granted to each purchaser a warrant (the “2023 Unsecured SPA Warrants”) to purchase shares of Class A Common Stock equal to 33 % of the shares

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

During the nine months ended September 30, 2024, SPA Notes with an aggregate principal amount of $ 96.3 million and a fair value of $ 44.9 million were converted into Class A Common Stock.

During the nine months ended September 30, 2023, SPA Notes with an aggregate principal amount of $ 200.4 million and a fair value of $ 125.3 million were converted into Class A Common Stock.

In connection with the conversions of the SPA Notes, the Company recognized a Loss on settlement of notes payable for the three and nine months ended September 30, 2024 in the amount of $ 56.4 million and $ 147.1 million, respectively, and three and nine months ended September 30, 2023 in the amount of $ 32.1 million and $ 207.7 million, respectively.

issuable upon conversion of the aggregate principal amount under the Secured SPA Notes funded.

The 2023 Unsecured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the 2023 Unsecured SPA Notes.

The 2023 Unsecured SPA Warrants are indexed to the Company’s Class A Common Stock and, as such, meet the scope exception in ASC 815-40 to be classified within equity.

The activity below does not include related party transactions, which are discussed separately in Note 8, Related Party Transactions .

Amendments, Waivers, and Modifications

The Waiver Agreement dated August 2, 2024, revised the terms of the Secured SPA Notes and 2023 Unsecured SPA Notes.

The terms of the 2023 Unsecured SPA Notes are substantially similar to those of the Secured SPA Notes and were similarly impacted by the Waiver Agreements.

Details of the Waiver Agreements and their effects on the Secured SPA Notes and 2023 Unsecured SPA Notes are discussed in the section on Secured SPA Notes.

Anti-Dilution Adjustments

As a result, the fixed-price conversion price of the 2023 Unsecured SPA Notes and exercise price of the 2023 Unsecured SPA Warrants outstanding prior to such financings was reduced to a price equal to the price per share paid in the dilutive financings.

On September 5, 2024, the Company entered into the Junior Secured SPA, which triggered the full ratchet anti-dilution price protection in the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrants.

The issuance of the Junior Secured SPA Notes constituted a dilutive issuance, as the stated conversion price of $ 5.24 was less than the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrant exercise price.

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrant.

The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $ 1.16 was less than the 2023 Unsecured SPA Notes conversion and Secured SPA Warrant exercise price.

During the three months ended March 31, 2025 there have not been any dilutive stock sale and purchase transactions.

Summary of 2023 Unsecured SPA Notes Activity

There were no outstanding 2023 Unsecured SPA Notes , as of March 31, 2025.

As of December 31, 2024, the fair value of the 2023 Unsecured SPA Notes was $ 6.7 million.

During the three months ended March 31, 2025, the Company did not receive cash proceeds or incur transaction costs, in exchange for the issuance of the 2023 Unsecured SPA Notes.

The Company converted debt with a principal amount of $ 4.4 million into 4,167,764 shares of the Company’s Class A Common Stock.

The conversion of 2023 Unsecured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $ 2.8 million.

For the three months ended March 31, 2025, the Company recognized $ 2.0 million gain from fair value remeasurement of 2023 Unsecured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

During the three months ended March 31, 2024, the Company did not receive cash proceeds, incur transaction costs, in exchange for the issuance of the 2023 Unsecured SPA Notes or conversion of 2023 Unsecured SPA Notes into shares of the Company’s Class A Common Stock.

For the three months ended March 31, 2024, the Company recognized a $ 2.9 million gain from fair value remeasurement of 2023 Unsecured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Unsecured Convertible Notes

Overview and Terms

In 2024 and 2025, the Company issued unsecured convertible note (the “Unsecured Convertible Notes”), with various investors including MHL, a related party.

These Unsecured Convertible Notes, mature three months from issuance, accrue interest at 4.27 % and are convertible at issuance into Class A Common Stock, certain SPA Portfolio Notes, or a future security purchase agreement issued by the Company.

The activity below does not include related parties activity, discussed separately in Note 8, Related Party Transactions .

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Unsecured Convertible Notes because the notes are exchangeable into SPA Portfolio Notes and the Company expects that to be how the Unsecured Convertible Notes settle .

Summary of Unsecured Convertible Notes Activity

There were no outstanding Unsecured Convertible Notes as of March 31, 2025, following their conversion into other SPA Portfolio Notes during the year ended December 31, 2024.

During the three months ended March 31, 2025, the Company issued related party Unsecured Convertible Notes discussed separately in Note 8, Related Party Transactions .

During the three months ended March 31, 2024, the Company received cash proceeds, net of original issue discounts of $ 7.6 million in exchange for the issuance of the Unsecured Convertible Notes and incurred approximately zero in transaction costs.

For the three months ended March 31, 2024, the Company recognized a $ 0.3 million loss from fair value remeasurement of Unsecured Convertible Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Junior Secured SPA Notes

On September 5, 2024, the Company entered into the Junior Secured SPA with the Junior Secured SPA Investors.

Pursuant to the Junior Secured SPA, the Junior Secured SPA Investors agreed to purchase Junior Secured SPA Notes, warrants, and incremental warrants for approximately $ 30.0 million, of which approximately $ 22.5 million was paid in cash and approximately $ 7.5 million was converted from a previous loan to the Company, in two closings.

As of September 30, 2024, the Company had received $ 20.8 million of the commitments, and the remaining commitments were received by October 30, 2024.

The Junior Secured SPA Notes are convertible, along with any interest accrued, into shares of Class A Common Stock at the conversion price (as defined in each Junior Secured SPA Note), subject to full ratchet anti-dilution price protection.

At issuance, the Junior Secured SPA Note conversion price equaled the lesser of the stated conversion price, $ 5.24 , or the greater of (1) the floor price, $ 1.05 , or (2) the average VWAP of the common stock for the five previous trading days.

The Junior Secured SPA Notes bear interest at 10 % per annum.

The Junior Secured SPA Notes require interest to be paid at maturity in cash or at conversion in shares of Class A Common Stock.

Overview and Terms

The Junior Secured SPA Notes were i ssued under the Junior Secured SPA dated September 5, 2024.

These notes are secured by a second-priority lien on certain assets and bear an annual interest rate of 10 %.

Principal and interest are payable at maturity or at each conversion date.

The notes are convertible along with accrued interest into Class A Common Stock at the lesser of (a) a fixed conversion price or (b) the greater of (1) the floor price, $ 1.05 , or (2) the average VWAP of the common stock for the five previous trading days.

Junior Secured SPA Notes are subject to full ratchet anti-dilution price protection and as of March 31, 2025 the fixed price conversion price was $ 1.16 .

These notes mature in September 2029.

The Junior Secured SPA Investors were given warrants (the “Junior SPA Warrants”) equal to 100 % of the shares issuable upon conversion of the aggregate principal amount under the Junior Secured SPA Note funded.

The Junior SPA Warrants are exercisable immediately with a term of five years and have an exercise price of $ 6.29 , subject to full ratchet anti-dilution protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions.

The Company issued to the placement agent for the transaction a warrant (the “Placement Agent Warrant”) identical to that of the Junior Secured SPA Investors for 202,768 shares of Common Stock, exercisable immediately at an exercise price of $ 6.29 subject to full ratchet anti-dilution price protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions.

The Placement Agent Warrant had a fair value of $ 0.6 million at issuance, which is included as an expense in the Changes in fair value of notes payable and warrant liabilities, in accordance with the Company’s election to account for the Junior Secured SPA Notes at fair value, discussed below.

Hereinafter the Placement Agent Warrant is included for discussion purposes with the Junior SPA Warrants since its form and terms are identical.

The Junior Secured SPA Investors were given an incremental warrant to purchase additional Junior Secured SPA Notes, up to amounts originally funded (the “Incremental Warrants”), at the same terms and conditions as the original Junior Secured SPA commitment.

The Incremental Warrants are exercisable immediately on the date thereof with a term of one year to purchase the Junior Secured SPA Notes at an exercise price equal to the principal amount of the Junior Secured SPA Notes issued to the Junior Secured SPA Investor, subject to full ratchet anti-dilution price protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Junior Secured SPA Notes because the notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

End of Period Junior Secured SPA Information

During the nine months ended September 30, 2024, the Company received cash proceeds, net of original issue discounts, of $ 13.25 million pursuant to the commitments included in the Junior Secured SPA Notes.

The Junior Secured SPA Notes were issued in 2024 and therefore there is no financial information to provide for the nine months ended September 30, 2023 or the twelve months ended December 31, 2023.

The Company incurred approximately $ 0.6 million and $ 0.6 million in related

The Junior SPA Warrants are exercisable immediately with a term of five years .

These warrants are subject to the same full ratchet anti-dilution price protection as the Junior Secured SPA Notes.

The Company’s Junior SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity.

The Junior SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company.

The Junior Secured SPA Investors were issued incremental warrants (the “Junior SPA Incremental Warrants”) to purchase additional Junior Secured SPA Notes up to the amounts originally funded under their original Junior Secured SPA Note commitments.

The Junior SPA Incremental Warrants, presented in the Unaudited Condensed Consolidated Balance Sheets as Derivative call options, are exercisable immediately upon issuance and have a one -year term.

They allow the purchase of the respective notes at an exercise price equal to the principal amount of the notes issued to the investor, subject to full ratchet anti-dilution price protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations, or similar transactions.

See Note 14, Fair Value of Financial Instruments for further details on the Junior SPA Incremental Warrants.

Amendments and Modifications

• Letter Agreements:

On January 28, 2025, the Company entered into a letter agreement (“September Letter Agreement”) with certain Junior Secured SPA Investors.

These investors agreed not to convert outstanding notes below the initial $ 5.24 conversion price prior to the Company’s receipt of stockholder approval for the issuance of the

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

transaction costs during the three and nine months ended September 30, 2024.

During the nine months ended September 30, 2024 the Company issued Junior SPA Warrants to the Junior Secured SPA Investors pursuant to the Junior Secured SPA Notes.

As of September 30, 2024, there were 5,931,638 Junior SPA Warrants outstanding.

The Junior SPA Warrants are subject to full ratchet anti-dilution price protection and are exercisable for five years from the date of issuance (see Note 11, Stockholders’ Equity ).

The Company may repurchase certain warrants for $ 0.01 per share if and to the extent the VWAP of the Class A Common Stock during 20 out of 30 consecutive trading days prior to the repurchase is greater than $ 12.58 per share, subject to certain additional conditions.

There were no Junior SPA Warrant exercises during the three and nine months ended September 30, 2024.

On September 30, 2024, the Company determined that the fair value of the Junior Secured SPA Notes was $ 9.4 million and the fair value of the Junior SPA Warrants was $ 13.4 million.

The Company recorded a loss in Change in fair value of notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss in the amount of $ 3.7 million for each of the three and nine months ended September 30, 2024 for the Junior Secured SPA Notes and Junior SPA Warrants.

During the nine months ended September 30, 2024, there were no conversions of Junior Secured SPA Notes into Class A Common Stock.

Unsecured Convertible Notes

During the nine months ended September 30, 2024, the Company issued unsecured convertible notes (the “Unsecured Convertible Notes”) to Senyun and MHL, in an aggregate principal amount of $ 28.9 million.

The Unsecured Convertible Notes are due three months from the date of issuance, accrue interest at a rate of 4.27 % per annum, and are convertible into either Class A Common Stock or into an SPA Note at the option of the holder.

If conversion into Class A Common Stock is elected, the conversion price is the latest closing price of the Company’s Class A Common Stock on the conversion date.

The Unsecured Convertible Notes are due on demand upon the occurrence of an event of default as defined in the notes.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Unsecured Convertible Notes because the Company believes the Unsecured Convertible Notes will be exchanged into an SPA Note pursuant to the conversion right included within the notes.

The SPA Notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

The Company recorded a gain in Change in fair value of notes payable and warrant liabilities in the amount of $ 0.8 million in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended September 30, 2024 and a loss in the amount of $ 2.4 million for the nine months ended September 30, 2024 for the Unsecured Convertible Notes.

This debt was in default as of the balance sheet date due to non-payment by the maturity date.

Junior Secured SPA Notes, Junior SPA Warrants and Junior SPA Incremental Warrants.

In return, the Company agreed to issue “True-Up Shares” after approval to adjust for any pre-approval conversions, based on a formula considering accrued interest and market pricing.

The Letter Agreement include a provision preventing the issuance of shares if the Company's available authorized stock is insufficient.

However, the Company must deliver the shares once a sufficient number of authorized but unissued shares becomes available.

Anti-Dilution Adjustments

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the Junior Secured SPA Notes and Junior Secured SPA Warrants.

The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $ 1.16 was less than the Junior Secured SPA Notes conversion and Junior Secured SPA Warrant exercise price.

During the three months ended March 31, 2025 there have not been any dilutive stock sale and purchase transactions.

Summary of Junior Secured SPA Notes Activity

As of March 31, 2025, the fair value of the Junior Secured SPA Notes was $ 6.1 million, compared to $ 26.1 million as of December 31, 2024.

During the three months ended March 31, 2025, the Company did not receive cash proceeds or incur transaction costs, in exchange for the issuance of the Junior Secured SPA Notes.

During the three months ended March 31, 2025, the Company converted debt with a principal amount $ 15.4 million into 113,958,070 shares of the Company’s Class A Common Stock.

The conversion of Junior Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $ 12.8 million.

For the three months ended March 31, 2025, the Company recognized $ 10.4 million gain from fair value remeasurement of Junior Secured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

There were no Junior Secured SPA Notes activity during and three months ended March 31, 2024.

2024 Unsecured SPA Notes

Overview and Terms

The 2024 Unsecured SPA Notes were issued under the Unsecured SPA Agreement dated December 21, 2024.

These notes bear an annual interest rate of 10 %.

Principal and interest are payable at maturity or at each conversion date.

The notes are convertible along with accrued interest into Class A Common Stock at the lesser of (a) a fixed conversion price, which was $ 1.16 at issuance, or (b) the greater of (1) the floor price, $ 1.05 , or (2) the lowest one -day VWAP of the common stock for the five previous trading days.

2024 Unsecured SPA Notes are subject to full ratchet anti-dilution price protection.

These notes mature on various dates through January 2030.

The 2024 Unsecured SPA Investors (defined below) were issued warrants (the “2024 Unsecured SPA Warrants”) equal to 100 % of the shares issuable upon conversion of the aggregate principal amount under the 2024 Unsecured SPA Notes (defined below) purchased by such 2024 Unsecured SPA Investor.

The 2024 Unsecured SPA Warrants are exercisable immediately with a term of five years .

2024 Unsecured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the 2024 Unsecured SPA Notes .

The Company’s 2024 Unsecured SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity.

The 2024 Unsecured SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company in a manner that is not consistent with the holders of the Company’s Common Stock

The 2024 Unsecured SPA Investors were issued incremental warrants (the “2024 Unsecured SPA Incremental Warrants”) to purchase additional 2024 Unsecured SPA Notes up to the amounts originally funded under their original 2024 Unsecured SPA Note commitments.

The 2024 Unsecured SPA Incremental Warrants, presented in the Unaudited Condensed Consolidated Balance Sheets as Derivative call options, are exercisable immediately upon issuance and have a one -year term.

See Note 14, Fair Value of Financial Instruments for further details on the 2024 Unsecured SPA Incremental Warrants.

Amendments and Modifications

• Letter Agreements:

On January 28, 2025, the Company entered into a letter agreement (“September Letter Agreement”) with certain the Company entered into a similar letter agreement (“December Letter Agreement”) with

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Collateralized Loan

On July 11, 2024, the Company entered into a $ 4.9 million collateralized loan arrangement (the “Collateralized Loan”) with Utica Leaseco, LLC (“Utica”).

Under the Collateralized Loan, the Company will pay Utica 51 monthly payments of $ 0.1 million and a balloon payment of $ 0.5 million at maturity for total remittances of $ 8.0 million.

The stated rate of the loan is 0.00 % but the effective interest rate is 28.00 %.

The effective interest rate represents the rate used to discount the future cash flows to their present value adjusted by the impact of approximately $ 0.4 million in costs paid to Utica and third parties in connection with the execution of the Collateralized Loan.

The Collateralized Loan has a 4-year term.

The monthly payments will be adjusted periodically based on fluctuations of the prime rate as determined by Renasant Bank.

Beginning January 1, 2025 and on each July 1 and January 1 thereafter, if the prime rate has increased 0.25 % in excess of 8.50 % (the “Surcharge Base Rate”), then Utica will increase each monthly payment by 10 % per month for each 0.25 % increase in the Surcharge Base Rate (the “Surcharge Amount”).

At each applicable date following the initial application of the Surcharge Amount, Utica shall adjust the monthly payment up or down for each 0.25 % fluctuation in the Surcharge Base Rate.

In no event shall the monthly payment reduce below the original amount.

After the payment in April 2026 and for the remaining term of the Collateralized Loan, the Company may terminate the Collateralized Loan by paying $ 0.5 million along with any monthly payments then due.

Also upon termination the Company will be obligated to pay Utica’s reasonable expenses to affect the termination, all sales and transfer taxes and all fees payable to any governmental authority.

Under the Collateralized Loan, the Company has identified certain machinery, vehicles, equipment and/or other assets (the “Equipment”) that serve as collateral for the loan.

The Company retains title to the Equipment, granting Utica a first priority security interest therein.

The Collateralized Loan contains customary representations and warranties, covenants relating to the use and maintenance of the Equipment, indemnification and events of default.

The Collateralized Loan further grants to Utica certain remedies upon a default, including the right to accelerate all payments for the remainder of the term, to recover liquidated damages, or to repossess and sell or otherwise dispose of the Equipment.

In connection with the execution of Collateralized Loan, the Company pre-paid the first two months’ rent, totaling $ 0.3 million, and paid various deposits to Utica in order to secure Utica’s reasonable access to the Equipment and to protect Utica from tax liens that may exist on the Equipment.

The various deposits totaled $ 1.6 million, $ 1.5 million of which is included in Deposits and $ 0.1 million is included in Other current assets in the Condensed Consolidated Balance Sheets as of September 30, 2024.

To the extent that the Company does not default on the arrangement and Utica does not need to utilize the various deposits to assert its rights under the Collateralized Loan, $ 0.1 million will be applied to payments due either upon early termination or maturity;

$ 0.1 million will be returned to the Company upon provision of all filed UCC-3 terminations evidencing the removal of tax liens from the Equipment;

and $ 1.4 million will be returned to the Company upon the relocation of the Equipment to the Company’s Hanford location.

Fair Value of Notes Payable Not Carried at Fair Value

The estimated fair value of the Company’s notes payable not carried at fair value, using inputs from Level 3 under the fair value hierarchy, approximated their carrying value as of September 30, 2024 and December 31, 2023, respectively.

certain 2024 Unsecured SPA Investors, modifying terms related to their previously disclosed investment.

These investors agreed not to convert outstanding notes below the initial $ 1.16 conversion price before stockholder approval for the issuance of the 2024 Unsecured SPA Notes, 2024 Unsecured SPA Warrants and 2024 Unsecured Incremental Warrants.

The Company agreed to issue True-Up Shares post-approval using an adjustment formula.

Additionally, if a resale registration statement becomes effective, and the conversion price exceeds the prior day's closing bid price, the conversion price will be adjusted downward.

December Letter Agreement includes a provision preventing the issuance of shares if the Company's available authorized stock is insufficient.

However, the Company must deliver the shares once sufficient stock becomes available.

Summary of 2024 Unsecured SPA Notes Activity

As of March 31, 2025, the fair value of the 2024 Unsecured SPA Notes was $ 11.3 million, compared to $ 7.0 million as of December 31, 2024.

During the three months ended March 31, 2025, the Company received cash proceeds, net of original issue discounts of $ 20.0 million in exchange for the issuance of the 2024 Unsecured SPA Notes and incurred approximately zero in transaction costs.

The Company did not convert any 2024 Unsecured SPA Notes into shares of the Company’s Class A Common Stock during the three months ended March 31, 2025.

For the three months ended March 31, 2025, the Company recognized a $ 6.8 million gain from fair value remeasurement of 2024 Unsecured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

There were no 2024 Unsecured SPA Notes activity during and three months ended March 31, 2024.

2025 March Unsecured SPA Notes

Overview and Terms

On March 21, 2025, the Company entered into a securities purchase agreement (the “2025 March Unsecured SPA”) with certain accredited investors, including MHL a related party, pursuant to which the Company agreed to issue and sell up to $ 41.0 million in aggregate principal amount of senior unsecured convertible promissory notes (the “2025 March Unsecured SPA Notes”).

The 2025 March Unsecured SPA permits up to four closings, each subject to specified closing conditions including minimum trading price and volume thresholds.

Additional closings may occur in future periods, subject to investor election and satisfaction of the conditions in the 2025 March Unsecured SPA Notes.

The activity below does not include related parties activity, discussed separately in Note 8, Related Party Transactions .

As of March 31, 2025, the Company received proceeds in the amount of $ 2.3 million in advance of the first closing, which occurred on April 4, 2025.

These proceeds are reported as outstanding notes as of March 31, 2025.

The 2025 March Unsecured SPA Notes mature five years from the date of issuance and bear interest at a fixed rate of 10 % per annum.

Interest is payable on each conversion date or at maturity and may be settled in cash, shares of Class A common stock, or a combination thereof, at the Company’s election and subject to certain conditions.

In the event of a default, the interest rate increases to 18 % per annum.

The Company may redeem the notes at a premium of 10 % over the greater of (i) the value of the shares otherwise issuable upon conversion and (ii) the value of the note’s outstanding principal.

In a bankruptcy-related default, the notes are redeemable at a 25 % premium, unless waived by the holder.

The 2025 March Unsecured SPA Notes are convertible at the option of the holder into shares of the Company’s Class A common stock at an initial fixed conversion price of $ 1.29 per share, subject to customary anti-dilution adjustments.

The number of shares issuable upon conversion is determined by dividing the outstanding principal and accrued interest, together with an 8 % premium, by the conversion price.

The notes also include an alternate conversion feature that permits the holder to convert at the lower of (i) the then-effective conversion price or (ii) the greater of $ 1.048 per share (the “floor price”) and the lowest volume-weighted average price (VWAP) of the Class A common stock during the five trading days immediately preceding the conversion notice.

If a conversion under the alternate mechanism would result in issuance below the floor price, the Company must either settle the difference in cash or increase the principal balance of the note by the shortfall amount.

2025 March Unsecured SPA Notes are subject to full ratchet anti-dilution price protection.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Schedule of Principal Maturities of Notes Payable

The future scheduled principal maturities of notes payable as of September 30, 2024 are as follows:

(in thousands)

Due on demand $ 4,950

Thereafter 31,512

The “2025 March Unsecured SPA Investors were issued warrants (the “2025 March Unsecured SPA Warrants”) equal to 100 % of the shares issuable upon conversion of the aggregate principal amount under the 2025 March Unsecured SPA Notes funded.

The 2025 March Unsecured SPA Warrants are exercisable immediately with a term of five years .

2025 March Unsecured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the 2025 March Unsecured SPA Notes .

The Company’s 2025 March Unsecured SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity.

The 2025 March Unsecured SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company in a manner that is not consistent with the holders of the Company’s Common Stock.

The 2025 March Unsecured SPA Investors were issued incremental warrants (the “2025 March Unsecured SPA Incremental Warrants”)to purchase additional 2025 March Unsecured SPA Notes up to the amounts funded under their 2025 March Unsecured SPA commitments.

The 2025 March Unsecured SPA Incremental Warrants, presented in the Unaudited Condensed Consolidated Balance Sheets as Derivative call options, are exercisable immediately upon issuance and have a one -year term.

See Note 14, Fair Value of Financial Instruments for further details on the 2025 March Unsecured SPA Incremental Warrants.

Summary of 2025 March Unsecured SPA Notes Activity

As of March 31, 2025, the fair value of the outstanding 2025 March Unsecured SPA Notes, was approximately $ 0.8 million.

During the three months ended March 31, 2025, the Company received cash proceeds, net of original issue discounts of $ 2.3 million in connection with the 2025 March Unsecured SPA Notes and incurred approximately $ 0.1 million in transaction costs.

The Company recognized a change in fair value of approximately zero during the three months ended March 31, 2025, related to the 2025 March Unsecured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Related Party Transactions

Related Party Notes Payable

The Company receives funding via notes payable from various parties, including related parties.

These related parties include employees as well as affiliates of employees, affiliates, and other companies controlled or previously controlled by the Company’s founder and Chief Product and User Ecosystem Officer.

Related party notes payable consisted of the following as of September 30, 2024:

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company has entered into notes payable agreements with related parties.

The Company receives funding through notes payable from various parties, including related parties.

These related parties include employees, affiliates of employees, affiliates, and other companies controlled or previously controlled by the Company’s Global Co-CEO (formerly its Chief Product and User Ecosystem Officer), The tables below summarize the related party note payable agreements as of March 31, 2025 and December 31, 2024, providing details on contractual maturity dates, contractual interest rates, and net carrying values.

March 31, 2025

(in thousands) Contractual

Date Contractual

Related party notes – Unsecured Convertible April 8, 2024 4.27 % $ 1,302

Related party notes – China December 2023 18.0 % 7,706

Related party notes – China various other Due on Demand — % 3,805

Related party notes – Convertible FFGP May 2024 4.27 % 250

Related party notes – FFGP Various 2024 4.27 % - 5.27 %

Related party notes – Other December 2024 12.0 % 75

Rates Net Carrying

Unsecured Convertible Note June 2025 (3)

2025 March Unsecured SPA Notes April 2030 10.00 % 143

Notes Payable — China April 2027 18.0 % (2)

Notes Payable on Demand — China Due on Demand — % 413

FFGP Note Various 2024 (1)

Convertible FFGP Note May 2024 (1)

Other Notes Due on Demand 12.0 % 75

Related party notes payable, current $ 4,298

Related party notes payable, less current $ —

Related party notes payable consisted of the following as of December 31, 2023:

Related party notes payable, long-term $ 2,825

_______________

(1) The term was extended upon receipt of waivers of enforcement rights and remedies under the loan agreements, as described below, with the expected settlement in 2025.

(2) The restructured loan bears no stated interest, and the repayment schedule requires fixed installment payments through the contractual maturity date.

If the Company fails to comply with the payment schedule, interest at a rate of 18.0 % would be retroactively applied to the unpaid balance.

During the term of the revised loan, the Company remained in compliance with the payment schedule, and no contingent interest has been recorded as of March 31, 2025.

(3) Subsequent to March 31, 2025 and prior to the issuance of these financial statements, MHL exchanged the Unsecured Convertible Note due June 2025 into 2025 March Unsecured SPA Notes pursuant to the terms of the original agreement.

As a result, management classified the Unsecured Convertible Note as a long-term related party debt instrument for the period ended March 31, 2025.

December 31, 2024

(in thousands) Contractual

Date Contractual

Related party notes – Unsecured SPA August 2029 10 % - 15 %

Related party notes – China December 31, 2023 18.0 % 5,103

Related party notes – China various other Due on Demand — % 3,789

Related party notes – FFGP Various 4.27 % - 5.27 %

Rates Net Carrying Value

Unsecured Convertible Note April 2024 (1)

4.27 % $ 1,364

Notes Payable — China April 2027 18.0 % 4,382

Notes Payable on Demand — China Due on Demand — % 417

FFGP Note Various (1)

Convertible FFGP Note May 2024 (1)

Other Notes Due on demand 12.00 % 75

Related party notes payable, current $ 5,310

Related party notes payable, less current $ —

Related party notes payable, long-term $ 2,754

_______________

(1) The term was extended upon receipt of waivers of enforcement rights and remedies under the loan agreements, as described below, with the expected settlement in 2025.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Related Party Notes - Unsecured SPA

MHL is the anchor investor in the Unsecured SPA and has committed $ 80.0 million of such funding.

MHL is a related party of the Company as MHL’s investors include a subsidiary of FF Global Partners LLC (“FF Global”), a stockholder of the Company.

FF Global has control over the Company’s management, business and operations.

See Note 7, Notes Payable , for details on the Unsecured SPA.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to the Unsecured SPA Notes because the notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

The Company expensed the transaction costs to Changes in fair value of related party notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Subsequent to the issuance of the Unsecured SPA, MHL funded, net of original issue discounts, $ 20.7 million in exchange for the issuance of the Unsecured SPA Notes and related warrants.

MHL did not fund the Unsecured SPA during the nine months ended September 30, 2024.

In connection with the Unsecured SPA, the Company issued to MHL SPA Warrants to purchase 886 shares of the Class A Common Stock.

The SPA Warrants are subject to full ratchet anti-dilution price protection and are exercisable for seven years from the date of issuance (see Note 11, Stockholders' Equity and Note 7, Notes Payable ).

During the nine months ended September 30, 2024, MHL converted its remaining outstanding gross principal balance, $ 0.7 million, in exchange for 33,108 shares of the Class A Common Stock.

In connection with the conversion of Unsecured SPA Notes, there was no Loss on settlement of related party notes during the three months ended September 30, 2024 and the Company recognized $ 0.2 million Loss on settlement of related party notes payable during the nine months ended September 30, 2024, for the difference between the fair value of the shares issued and the fair value of the debt instrument.

As of September 30, 2024, there were no Related party notes payable issued pursuant to the Unsecured SPA.

Related Party Notes - Unsecured Convertible

In January 2024, the Company issued an unsecured convertible note to MHL in a principal amount of $ 1.5 million.

The note was due three months from the date of issuance, (i.e., in April 2024), accrues interest at a rate of 4.27 % per annum, and is convertible into either Class A Common Stock or into an SPA Note at the option of the holder.

If conversion into Class A Common Stock is elected, the conversion price is the latest closing price of the Company’s Class A Common Stock on the conversion date.

The debt is due on demand upon the occurrence of an event of default as defined in the note.

The Company elected the fair value option afforded by ASC 825, Financial Instruments , with respect to this note because the Company believes the note will be exchanged into an SPA Note pursuant to the conversion right included within the note.

The SPA Notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative.

This debt was in default as of the balance sheet date due to non-payment by the maturity date.

The Company recorded a gain in Change in fair value of related party notes payable and warrant liabilities in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2024 in the amount of $ 0.6 million and $ 0.1 million for the related party convertible notes.

Related Party Notes - China

Previously, the Company had outstanding debt payable to Chongqing Leshi Small Loan Co., Ltd.

(“Chongqing”), a related party.

In 2022, Chongqing agreed to modify its debt agreement with the Company if the Company agreed to make a payment of 10 % of the outstanding principal.

Under this modified agreement, the Company received the rights to all interest accrued, a discount in principal balance, and agreed to make payments during 2023 to completely pay the discounted principal by December 31, 2023.

The Company did not pay the outstanding principal and interest amount in full by the maturity date of December 31, 2023, and as a result, the Company incurred substantial interest and penalties.

Per the terms of the modified agreement, all outstanding interest and penalties since the inception of the original agreement reverted to Chongqing and the discounted principal balance returned to the full unpaid amount.

As a result, the Company recognized no and $ 14.1 million loss on related party notes payable and related party warrants for the three and nine months ended September 30, 2024, respectively, in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

As of September 30, 2024 and December 31, 2023, the outstanding principal balance related to this related party note was $ 7.7 million and $ 5.1 million, respectively, and the outstanding accrued related party interest was $ 20.0 million and $ 0.8 million, respectively.

Schedule of Principal Maturities of Related Party Notes Payable

The future scheduled principal maturities of Related party notes payable as of March 31, 2025, are as follows:

(in thousands)

Years Ending December 31, Amount

Due on demand $ 488

2025 (9 months remaining) 4,813

The Company has entered into various financing arrangements with related parties, categorized as follows:

(i) Unsecured Convertible Note ;

(ii) Unsecured Convertible Note ;

(iii) 2025 March Unsecured SPA Notes;

(iv) Notes Payable — China ;

(v) Notes Payable on Demand — China ;

(vi) FFGP Note ;

and (vii) Convertible FFGP Note .

2023 Unsecured SPA Notes

In May 2023, June 2023, and October 2023, the Company issued unsecured convertible notes to MHL, a related party, under the 2023 Unsecured SPA Notes as the anchor investor.

(For information on the terms of this note, see Note 7, Notes Payable 2023 Unsecured SPA Notes issued to third-parties.)

The Company elected the fair value o ption under ASC 825, Financial Instruments , for the 2023 Unsecured SPA Notes because the notes include features such as a contingently exercisable put option, which meets the definition of an embedded derivative.

MHL converted $ 0.7 million of gross principal balance in exchange for 33,107 shares of Class A Common Stock during the quarter ended March 31, 2024.

During the quarter ended March 31, 2024, the Company recognized a loss of $ 0.2 million on the settlement (conversion) of related party notes payable into shares of Class A Common stock and losses of $ 0.1 million, due to fair value adjustments under ASC 825.

As of March 31, 2024 , there were no related party notes payable outstanding pursuant to the 2023 Unsecured SPA Notes .

Unsecured Convertible Note

In January 2024, the Company issued an unsecured convertible note to MHL, a related party, in a principal amount of $ 1.5 million.

The note was due three months from the date of issuance ( April 2024 ), accrued interest at an annual rate of 4.27 % per annum, and is convertible at the option of the holder into either Class A Common Stock or into a 2023 Unsecured SPA Note.

In February 2025, MHL converted the outstanding debt with a principal balance of $ 1.5 million into 1,352,767 shares of Class A Common Stock The conversion of the Unsecured Convertible Note into Class A Common Stock resulted in a Loss on extinguishment of $ 1.2 million

In March 2025, the Company issued an unsecured convertible note to MHL, in a principal amount of $ 1.5 million.

The note was due three months from the date of issuance, accrued interest at an annual rate of 4.27 % per annum, and is convertible at the option of the holder into either Class A Common Stock or into unsecured convertible notes issued subsequently pursuant to a Securities Purchase Agreement.

If conversion into Class A Common Stock is elected, the conversion price would be based on the latest closing price of the Company’s Class A Common Stock on the conversion date.

If settlement in a subsequent Securities Purchase Agreement is elected, the new note would be issued with a 15 % original issue discount.

Subsequent to March 31, 2025 and prior to the issuance of these financial statements, MHL exchanged the Unsecured Convertible Note into 2025 March Unsecured SPA Notes.

As a result, management classified the $ 1.5 million Unsecured Convertible Note as a long-term related party debt instrument for the period ended March 31, 2025.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Related Party Notes - Convertible FFGP

In February 2024, the Company and FFGP Investment Holding I, LLC (“FFGP”), a related party, entered into an unsecured convertible note in the amount of $ 0.3 million.

The note has a maturity date of May 2024, accrued interest at a rate of 4.27 % per annum, and is convertible into Class A Common Stock at the option of the holder.

The Company elected to apply the fair value option under ASC 825, Financial Instruments , for these notes, based on its expectation that the note will be exchanged into SPA Portfolio Notes pursuant to the holder’s conversion rights.

SPA Portfolio Notes include features such as a contingently exercisable put option, which meet the definition of an embedded derivative under applicable accounting standards.

For the three months ended March 31, 2025 the Company recognized a gain in the amount o f approximately zero in Change in fair value of related party notes payable, warrant liabilities, and derivative call options within the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

This gain reflects the adjustment to the note’s fair value during the reporting period.

For the three months ended March 31, 2024, the Company recognized a $ 0.1 million gain from fair value remeasurement of the Unsecured Convertible Note under ASC 825, recorded in Change in fair value of related party notes payable, warrant liabilities, and derivative call options within the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

2025 March Unsecured SPA Notes

Certain investors in the 2025 March Unsecured SPA Notes (see Note 7, Notes Payable ) include related parties.

Summary of Activity

During the three months ended March 31, 2025, related party investors funded a portion of the Company’s total proceeds under the 2025 March Unsecured SPA.

The Company issued $ 0.4 million in principal amount of 2025 March Unsecured SPA Notes to related parties in connection with these closings.

These related party investors also received 2025 March Unsecured SPA Warrants and Incremental Warrants on terms identical to those described in Note 7, Notes Payable .

The fair value of these related party-held notes as of March 31, 2025, was approximately $ 0.1 million.

During the three months ended March 31, 2025, the Company recognized a change in fair val ue of approximately zero , under AS C 825, recorded in Change in fair value of related party notes payable, warrant liabilities, and derivative call options within the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Notes Payable — China

The Company has outstanding debt payable to Leshi Small Loan Co., Ltd.

(“Chongqing”), a related party, also known as “ Notes Payable — China.” In 2022, Chongqing agreed to modify the debt agreement, contingent on the Company making an initial payment of 10% of the agreed upon discounted principal amount.

Under the modified terms, the Company received a waiver of accrued interest, a reduction in the principal balance, and an extended repayment schedule requiring full payment of the discounted principal by December 31, 2023.

However, the Company did not pay the outstanding principal amount in full by the maturity date of December 31, 2023, and as a result, in January 2024 the Company incurred substantial interest and penalties.

Per the terms of the 2022 agreement, in the event of a default at maturity all outstanding interest and penalties since the inception of the original agreement reverted to Chongqing and the discounted principal balance returned to the full unpaid amount.

As a result, the Company recognized a loss of $ 14.1 million shown as component of Loss on settlement of related party notes payable in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss during the three months ended March 31, 2024.

In December 2024, the Company repaid $ 0.1 million an d entered into supplementary agreements with Chongqing, further restructuring its outstanding debt.

The December 2024 agreements largely restored the debt to amounts outstanding prior to the default on December 31, 2023.

If the Company defaults again on its payment plan with Chongqing the interest and penalties accrued since the inception of the original agreement and the note principal will revert back to Chongqing in proportion to the unpaid portion of the discounted principal balance.

The agreements maintain an 18.0 % stated interest rate for the debt and establish a payment plan for periodic principal and interest payments until the revised maturity date of April 2027 .

The Company accounted for the restructuring as a troubled debt restructuring under ASC 470-60, Debt – Troubled Debt Restructurings by Debto rs .

As a result of the restructuring, the Company recognized a gain of $ 0.7 million in additional paid-in capital, reflecting the related party nature of the transaction.

Following the restructuring and subsequent principal payments, the Company's Notes Payable—China is in good standing as of March 31, 2025.

As of March 31, 2025, the principal value of this note payable was $ 4.2 million, compared to $ 4.4 million as of December 31, 2024.

During the three months ended March 31, 2025, the Company repaid $ 0.1 million and recognized a gain of $ 0.7 million in additional paid-in capital, As of March 31, 2025 and December 31, 2024, the Company had accrued but unpaid

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

interest and penalties of $ 22.2 million and $ 23.1 million recorded in Related party accrued interest on the Unaudited Condensed Consolidated Balance Sheets.

Notes Payable on Demand — China

The Comp any's notes payable with investors based in China (“Notes Payable on Demand — China” ) bear a zero percent interest rate.

The outstanding balance as of March 31, 2025 and December 31, 2024, was $ 0.4 million and $ 0.4 million, respectively.

In November 2023 and January 2024, the Company issued unsecured promissory notes to FFGP Investment Holding I, LLC (“FFGP”), a related party, in an aggregate principal amount of $ 1.6 million.

These notes, referred to as the “FFGP Note”, were due three months from their respective dates of issuance and accrued interest at either 4.27 % or 5.27 %.

FFGP fully waived its enforcement rights and remedies under the loan agreement with respect to the outstanding principal balance until final settlement.

As a result, the FFGP Note is in good standing as of March 31, 2025, however, it remains due on-demand.

The carrying values of the FFGP Note were $ 1.6 million as of March 31, 2025 and December 31, 2024 .

Convertible FFGP Note

In February 2024, th e Company and FFGP entered into an unsecured convertible note in the principal amount of $ 0.3 million.

The note referred to as the “ Convertible FFGP Note”, has a maturity date of May 2024 accrued interest at a rate of 4.27 % per annum, and is convertible into the Company’s Class A Common Stock at the holder’s option.

The conversion price is the latest closing price of the Company’s Class A Common Stock on the conversion date.

The debt is due on demand upon the occurrence of an event of default as defined in the agreement.

This debt was in default as of the balance sheet date due to non-payment by their respective maturity dates.

Related Party Notes - FFGP

In November 2023 and January 2024, the Company issued unsecured promissory notes to FFGP, a related party, in an aggregate principal amount of $ 1.6 million.

These notes were due three months from their respective date of issuance and accrued interest at either 4.27 % or 5.27 %.

The debt is due on demand upon the occurrence of an event of default as defined in the note.

This debt was in default as of the balance sheet date due to non-payment by their respective maturity dates.

Fair Value of Related Party Notes Payable Not Carried at Fair Value

The estimated fair value of the Company’s related party notes payable not carried at fair value approximated their carrying value as of September 30, 2024 and December 31, 2023, respectively.

X-Butler previously known as Warm Time Inc.

(“Warm Time”) and Ocean View Drive Inc.

(“Ocean View”) Transactions

The Company leased two real properties, located in Rancho Palos Verdes, California (the “Rancho Palos Verdes Properties”), from X-Butler from January 1, 2018 through March 31, 2022.

X-Butler in turn leased the Rancho Palos Verdes Properties from Yueting Jia, the Company’s founder and Chief Product and User Ecosystem Officer.

FFGP fully waived its enforcement rights and remedies under the loan agreement with respect to the outstanding principal balance until final settlement.

As a result, the Convertible FFGP Note is in good standing as of March 31, 2025, however, it remains due on-demand.

The carrying value of the Convertible FFGP Note was $ 0.3 million as of March 31, 2025 and December 31, 2024 .

Related Party Accounts Payable, Accrued Liabilities and Other Significant Transactions

The Company engages in various related party transactions that do not involve notes payable, including property leases, consulting services, advertising services, and other financial arrangements with entities affiliated with its founder, key executives, and their family members.

This section excludes related party notes, which are discussed separately, and focuses on summarizing the nature, terms, and financial impacts of these non-debt-related transactions as of March 31, 2025 and December 31, 2024, including payments, outstanding balances, and other key details.

X-Butler Transactions

The Company l eased two real properties, located in Rancho Palos Verdes, California (the “Rancho Palos Verdes Properties”), from X-Butler from January 1, 2018, through March 31, 2022.

X-Butler in turn leased the Rancho Palos Verdes Properties from Mr.

Yueting Jia, the Company’s founder and Global Co-CEO .

The Rancho Palos Verdes Properties were used by the Company to provide long-term or temporary housing to employees of the Company (including a former Global CEO).

According to the agreement between the parties, the Company paid X-Butler for rent and certain services, including catering, room services and organization of meetings, external gatherings and events, for the Rancho Palos Verdes Properties.

For the three months ended September 30, 2024 and September 30, 2023, the Company paid to X-Butler zero and $ 0.1 million, respectively, for rent and business development services rendered to the Company and its executives.

The Company has recorded approximately $ 0.2 million and $ 0.1 million in Accounts Payable as of September 30, 2024 and December 31, 2023, respectively.

On February 9, 2023, the Company made a payment of approximately $ 0.2 million on behalf of Ocean View, an indemnified co-defendant, in connection with a seizure of funds related to the outstanding judgment in ongoing litigation, also involving Han’s San Jose Hospitality, LLC.

Ocean View fulfilled its payment obligation under the settlement arrangement of such litigation, but the Company did not make its payment on the outstanding judgment which caused such seizure of funds of Ocean View.

See Note 10, Commitments and Contingencies , for more information.

Following such seizure, the Company paid the outstanding judgment and all accrued interest.

The Company received the return of such indemnification payment in April 2023.

FF Global Expense Reimbursements and Consulting Fees

On July 30, 2022, the Company entered into a preliminary term sheet (the “Preliminary Term Sheet”) with FF Top Holding LLC (“FF Top”), a subsidiary of FF Global, setting out a summary of the preliminary terms and conditions for FF Top’s assistance in arranging a proposed convertible term loan facility to the Company.

In connection with the Preliminary Term Sheet, the Company agreed to reimburse FF Top for its reasonable and documented out-of-pocket legal and diligence fees and expenses incurred in connection with such financing efforts up to a $ 0.3 million cap (the “Original Cap”), irrespective of whether or not closing occurred, with $ 0.2 million to be payable as a deposit upon execution of the Preliminary Term Sheet.

Pursuant to the Preliminary Term Sheet, the Company paid FF Top $ 0.4 million in 2022.

On January 31, 2023, the Company entered into a supplemental agreement to the Preliminary Term Sheet (the “Term Sheet” and with such supplemental agreement, the “Supplemental Agreement”) with FF Global, pursuant to which the parties agreed, due to the high amount of FF Global’s out-of-pocket legal fees and expenses incurred in connection with its financing efforts, to amend the Preliminary Term Sheet to increase the Original Cap from $ 0.3 million to $ 0.7 million.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

agreed to pay the remaining $ 0.4 million of the fees owed to FF Global as follows:

(i) $ 0.2 million within one business day of execution of the Supplemental Agreement, and (ii) $ 0.2 million within one business day of consummation of new financing by the Company in an amount not less than $ 5.0 million or an earlier date approved by the Board.

Pursuant to the Preliminary Term Sheet, as amended by the Supplemental Agreement, the Company paid FF Global $ 0.2 million on each of February 1, 2023 and February 6, 2023.

On April 8, 2023, the Company reimbursed FF Global for $ 0.2 million related to legal expenses incurred by FF Global in connection with the Sixth Secured SPA Amendment.

In addition, on April 10, 2023 and May 31, 2023, the Company reimbursed FF Global for $ 0.1 million and $ 0.3 million related to legal expenses incurred by FF Global in connection with certain unsecured financings.

In February 2023, FF Global requested from the Company legal expense reimbursement of $ 6.5 million for costs incurred related to the governance changes at the Company, which was not approved by the Board as of the date these Unaudited Condensed Consolidated Financial Statements were issued.

FF Global may in the future continue to request additional expense reimbursements and indemnification from the Company.

On March 6, 2023, the Company entered into a consulting service agreement with an effective date of February 1, 2023 with FF Global (the “Consulting Services Agreement”), according to which the Company agreed to pay a monthly consulting fee of $ 0.2 million to FF Global for the following services:

• Assistance in developing its funding strategy.

• Assistance in developing its value return and management strategy.

• Consultation on and integration of stockholder relations and stockholder resources.

• Supporting communications regarding stockholders meetings.

• Developing existing stockholder financing strategy, including with respect to retail investors and others.

• Assistance in risk management strategy.

• Assistance in capability build up and operation strategy.

The Consulting Services Agreement has an initial term of 12 months and automatically renews for successive 12 months periods unless earlier terminated in accordance with the terms thereof.

Effective March 6, 2024, the Consulting Agreement renewed automatically.

Either party may terminate the Consulting Services Agreement upon one month prior written notice to the other party.

Upon any termination of the Consulting Services Agreement, the Company shall promptly pay FF Global any accrued but unpaid fees hereunder and shall reimburse FF Global for any unreimbursed expenses that are reimbursable thereunder.

In addition, FF Global is entitled to reimbursement for all reasonable and documented out-of-pocket travel, legal, and other out-of-pocket expenses incurred in connection with their services, which expenses shall not exceed $ 0.1 million without the prior written consent of the Company.

The Company paid $ 0.2 million and $ 0.7 million to FF Global during the three and nine months ended September 30, 2024, respectively, and $ 0.9 million and $ 1.4 million for the three and nine months ended September 30, 2023, respectively, pursuant to the Consulting Services Agreement.

The Company has $ 1.5 million and $ 0.6 million of amounts payable to FF Global recorded in Accounts Payable and Accrued Liabilities in the Unaudited Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively.

Common Units of FF Global

During 2022, certain executives and employees of the Company were granted the opportunity to subscribe to 600,000 common units of FF Global.

The subscription price of $ 20.00 per common unit, payable by the executives and employees of the Company, was financed through non-recourse loans issued by FF Global payable in equal annual installments over ten years .

The common units to be purchased with a non-recourse loan are required to be treated for accounting purposes as stock options granted by FF Global to executives and employees of the Legacy FF.

The awards were valued using the Black-Scholes option pricing model.

The grant date fair value of the units purchased through non-recourse loans was immaterial for the three and nine months ended September 30, 2024 and 2023.

For the quarters ended March 31, 2025 and 2024, the Company paid to X-Butler $ 0.1 million and $ 0.1 million, respectively, for rent and business development services rendered to the Company and its executives.

The Company has recorded approximately $ 0.3 million and $ 0.3 million in Accounts Payable as of March 31, 2025 and December 31, 2024, respectively.

FF Global Transactions and Consulting Services

FF Global is an affiliate of the Company’s founder and Global Co-CEO, Mr.

Yueting Jia, and has historically exerted significant influence over the Company’s governance.

Effective March 23, 2025, the Company terminated its Consulting Services Agreement with FF Global, which had originally become effective on February 1, 2023.

The agreement, which provided for a monthly fee of $ 0.2 million in exchange for strategic and operational advisory services, had automatically renewed on March 6, 2024, for an additional 12-month term.

It also permitted FF Global to request reimbursement for reasonable and documented out-of-pocket expenses, including travel and legal fees, subject to certain limits.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

In early 2023, FF Global submitted a request for $ 6.5 million in legal expense reimbursements related to governance matters.

The request was not approved by the Board, no liability has been recorded, and the matter remains unresolved.

Following the termination of the agreement, the Company has no further obligations to FF Global other than for consulting fees and reimbursable expenses incurred prior to March 23, 2025.

The Company has recorded approximately $ 2.0 million and $ 2.0 million in Accounts Payable as of March 31, 2025 and December 31, 2024, respectively.

These amounts do not include the $ 6.5 million reimbursement request.

Advertising Services Payable to Leshi Information Technology Co., Ltd.

The Company has recorded a payable to LeTV within Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets in the amount of $ 7.8 million and $ 7.5 million as of September 30, 2024 and December 31, 2023, respectively, in connection with advertising services provided to the Company in prior years.

The Company has recorded a payable to LeTV within Related party accrued expenses and other current liabilities in the amount of $ 7.8 million and $ 7.7 million as of March 31, 2025 and 2024, respectively, in connection with advertising services provided to the Company in prior years.

LeTV is a Shanghai Stock Exchange-listed public company founded and controlled by Mr.

Yueting Jia, the Company’s founder and Chief Product and User Ecosystem Officer.

Other Related Party Transactions

The Company pays for a vehicle lease totaling less than $ 0.1 million annually on behalf of Mr.

The Company owes a total of $ 0.5 million and $ 0.2 million to various related parties as of September 30, 2024 and December 31, 2023, respectively, which is included in Accounts payable within the Condensed Consolidated Balance Sheets.

On September 4, 2024 (the “Effective Date”), the Board approved changes to the compensatory arrangements for the Company’s Global CEO, Matthias Aydt, and the Company’s Founder and Chief Product and User Ecosystem Officer, Yueting Jia.

In furtherance of the Board approval, Mr.

Jia entered into Salary Deduction and Stock Purchase Agreements (“SD SPAs”) to authorize the Company to deduct a portion of the officers’ after-tax base salary (equal to approximately 64 % of his initial pro-rated $ 550,000 base salary for Mr.

Aydt and approximately 56 % of his initial pro-rated $ 612,000 base salary for Mr.

Jia, in each case after-tax).

The September 2024 SDA SPAs will terminate on the three-month anniversary of the Effective Date.

During the three months ended September 30, 2024, Mr.

Jia purchased shares of the Company’s Class A common stock in an aggregate amount of 10,455 shares for a weighted average purchase price of $ 3.42 per share.

The Company determines if an arrangement is a lease at its commencement if the Company is both able to identify an asset and conclude that the Company has the right to control the identified asset.

Leases are classified as finance leases or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee.

A right-of-use (“ROU”) asset represents the Company’s right to use an underlying asset for the lease term and a lease liability represents the Company’s obligation to make lease payments related to the lease.

Yueting Jia, the Company’s founder and Global Co-CEO.

During 2024 the Company entered into several related party transactions with Grow Fandor Inc.

(“Grow Fandor”).

Grow Fandor is considered a related party because it is significantly influenced by Mr.

Yueting Jia, the Company’s Global Co-CEO, who has a financial and operational interest in the entity.

Grow Fandor was co-founded by Mr.

Jerry Wang, who currently serves as President of the Company and is the sole director of Grow Fandor.

There have been no related party transactions with Grow Fandor during 2025.

Below is a summary of the Company’s transactions with Grow Fandor and the related accounting treatment:

• Promissory Note:

In September 2024, the Company executed a promissory note with Grow Fandor in the principal amount of $ 75,000 .

This note has been classified as “Other Notes” in table above that the summarizes the related party note payable agreements as of March 31, 2025.

• Share Donation:

In October 2024, the Company received a donation of 15,000,000 shares of Class B Common Stock of Grow Fandor from Mr.

Yueting Jia, which represents an approximately 10 % ownership interest.

Because Grow Fandor is in the preliminary stages of development and has not begun commercial operations, management concluded that the shares do not currently have value within the financial statements.

• Trademark License Agreement:

In October 2024, the Company and Grow Fandor executed the Trademark License Agreement.

Under the terms of the licensing agreement, Grow Fandor has exclusive licensing rights as the only third-party allowed to use the FF and FX brands and marks during the contract term.

In exchange Grow Fandor will pay to the Company:

(1) a royalty fee, payable quarterly, calculated as the greater of:

(a) 50 % of the annual net profit from FF and FX ecosystem products, and (b) 5 % of net sales revenue from all relevant brand ecosystem products;

and (2) a $ 250,000 annual base license fee.

Grow Fandor paid the initial annual license fee.

Subsequent annual license fees will be payable within 30 days after each contract year.

The Company recorded the initial license fee as a capital contribution due to the related party nature of the relationship with Grow Fandor and Yueting Jia’s public statements that the relationship is designed to provide incremental capital to the Company.

Other Financing Liabilities

FF ieFactory California (“Hanford”) Financing Arrangement

On October 19, 2023, the Company entered into a sale leaseback transaction whereby it has exercised its option to purchase its FF ieFactory California manufacturing facility located in Hanford California (the “Property”) and simultaneously completed a sale leaseback to Ocean West Capital Partners (“Landlord”) pursuant to that certain Lease Agreement, dated as of October 19, 2023, by and between the Tenant and 10701 Idaho Owner, LLC (the “Lease Agreement”).

This Lease Agreement also allows the Tenant access to up to $ 12.0 million of tenant improvement allowance for the Property.

The Lease Agreement is for a term of five years , with a monthly lease rate of $ 355,197 , with a five -year extension option, and the Tenant has an option to purchase the fee interest in the Property at any time after the second year of the lease term.

Furthermore, the Tenant has a right of first offer to purchase the Property in the event Landlord desires to sell the Property.

The obligations of the Tenant under the lease are guaranteed by the Company pursuant to that certain Guaranty of Lease made by the Company to 10701 Idaho Owner, LLC.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Due to the inclusion of the purchase option in the lease agreement, the Company was considered to have continuing involvement and, thus, accounted for the transaction as a failed sale lease back, with the Property assets subject to the sale leaseback remaining on the balance sheet and the sale proceeds recorded as a liability in accordance with the financing method.

The Company recognized a $ 1.1 million financing obligation at the completion of the transaction, which was recorded to the Other financing liabilities, long term portion on its Unaudited Condensed Consolidated Balance Sheets.

No gain or loss was recorded on the failed sale and lease back.

On March 14, 2024, the Company entered into the First Amendment to the Lease Agreement (the “First Amendment).

The First Amendment established a repayment plan requiring the Company to pay an aggregate amount of $ 1.7 million of past due rent by March 31, 2024.

The Company has an original Security Deposit balance of $ 1.5 million.

In December 2024, the Landlord applied $ 0.6 million of the original Security Deposit to past due rent.

In January 2025, the Company paid the Landlord $ 0.6 million that reinstated the Security Deposit balance.

On August 27, 2024, the Company entered into the Second Amendment to the Lease Agreement (the “Second Amendment”).

Under the terms of the original lease agreement, the Company expected to receive $ 12.0 million in tenant improvement allowance, the repayment of which was included in the scheduled financing obligation payments.

In the Second Amendment, the Landlord agreed to fund up to $ 10.0 million of the costs associated with the replacement of the Property’s roof and the remaining $ 2.0 million for other improvement costs.

The $ 2.0 million may be reduced by incremental actual costs incurred for the roof replacement and the remaining amount will be contingent on the Company funding up to 66.67 % of the other improvement costs.

As of March 31, 2025 and December 31, 2024, the Company had a leasehold improvement balance of $ 8.0 million and $ 6.9 million, respectively, within Property, plant and equipment, net, reflecting amounts funded through the tenant improvement allowance.

The repayment of the tenant improvement allowance are included in the scheduled financing obligation payments.

For the quarters ended March 31, 2025 and 2024, the Company recorded interest expense of $ 1.9 million and $ 1.7 million, respectively.

The financial liability as of March 31, 2025 and 2024 was $ 36.5 million and $ 33.7 million, respectively.

Collateralized Loan

Overview and T erms

The Collateralized Loan was entered into on July 11, 2024, with Utica Leaseco, LLC.

The loan is secured by machinery and equipment owned by the Company.

It bears an effective interest rate of 23 % and requires 51 monthly payments of $ 0.1 million, concluding with a $ 0.5 million balloon payment in October 2028.

The loan terms include provisions for adjusting monthly payments based on fluctuations in the prime rate.

Summary of Collateralized Loan Activity

As of March 31, 2025 and December 31, 2024, the carrying value of the Collateralized Loan was $ 4.1 million and $ 4.3 million , respectively.

Of these amounts $ 0.8 million and $ 0.8 million, respectively, were included in Other financing liabilities, current portion and $ 3.3 million and $ 3.5 million, respectively, were included in Other financing liabilities, long term portion in the Unaudited Condensed Consolidated Balance Sheets .

For the three months ended March 31, 2025, the Company repaid $ 0.2 million of Collateralized Loan principal.

The future scheduled principal maturities of financing obligations as of March 31, 2025 are as follows:

(in thousands)

Years Ending December 31,

2025 ( 9 months remaining)

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company determines if an arrangement is a lease at its commencement if the Company is both able to identify an asset and conclude the Company has the right to control the identified asset.

Leases are classified as finance or operating based on the principle of whether or not the lease is effectively a financed purchase by the lessee.

An ROU asset represents the Company’s right to use an underlying asset for the lease term and a lease liability represents the Company’s obligation to make lease payments related to the lease.

The Company recognizes operating and finance lease ROU assets and liabilities at the commencement date based on the present value of lease payments over the lease term.

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The Company’s leases do not include any material residual value guarantees, or bargain purchase options.

To the extent that the Company’s agreements have variable lease payments, the Company includes variable lease payments that depend on an index or a rate in the measurement and classification of a lease and excludes those that depend on facts or circumstances occurring after the commencement date, other than the passage of time.

Lease expense for operating leases is recognized on a straight-line basis over the lease term and is recorded in Operating expenses on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

To the extent that the Company’s agreements have variable lease payments, the Company includes variable lease payments that depend on an index or a rate in the measurement and classification of a lease and exclude those that depend on facts or circumstances occurring after the commencement date, other than the passage of time.

Lease expense for operating leases is recognized on a straight-line basis over the lease term and is recorded in operating expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Amortization of ROU assets on finance leases is recorded on a straight-line basis within operating expenses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Interest expense incurred on finance lease liabilities is recorded in Interest expense on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Interest expense incurred on finance lease liabilities is recorded in Interest expense in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

The Company has elected not to recognize ROU assets and lease liabilities that arise from short-term (12 months or less) leases for any class of underlying asset.

Additionally, the Company does not separate lease and non-lease components.

Operating leases are included in ROU assets, Operating leases liabilities, current portion and Operating lease liabilities, less current portion in the Company's Unaudited Condensed Consolidated Balance Sheets.

Finance leases are included in Property, plant and equipment, net, Finance lease liabilities, current portion, and Finance lease liabilities, less current portion in the Company's Unaudited Condensed Consolidated Balance Sheets.

The Company’s lease arrangements consist primarily of its corporate office, store, and vehicle lease agreements.

The leases expire at various dates through 2032, some of which include options to extend the lease term for additional 5-year periods.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

During the nine months ended September 30, 2024, the Company moved out of a leased store facility and a leased research facility while working with the landlords to negotiate the related lease terminations, resulting in a lease ROU asset impairment loss of $ 7.5 million for the loss of use of these two leased facilities.

As of September 30, 2024, the lease liabilities of the two leases remained on the Company’s books.

In addition, the Company terminated two operating leases in China, resulting in a net lease ROU asset impairment loss of $ 0.1 million during the nine months ended September 30, 2024.

Total lease costs for operating leases for the nine months ended September 30, 2024 were:

(in thousands) Nine Months Ended September 30, 2024

Operating lease cost $ 3,816

Variable lease cost 736

Total lease cost $ 4,552

The following table summarizes future lease payments as of September 30, 2024:

(in thousands)

Fiscal year Operating Leases

2024 (three months) $ 1,261

Thereafter 7,471

Imputed Interest 7,774

Present value of net lease payments 14,405

Lease liability, current portion $ 2,645

Lease liability, net of current portion 11,760

Total lease liability $ 14,405

Supplemental information and non-cash activities related to operating leases are as follows:

(in thousands) Nine Months Ended September 30, 2024

Cash paid for amounts included in the measurement of lease liabilities

Operating cash flows from operating leases $ 1,932

Lease liabilities arising from new right-of-use assets

Operating leases $ 30

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

September 30, 2024 December 31, 2023

Weighted average remaining lease term (in years)

Operating leases 5.6 5.7

Finance leases 0.0 5.0

Weighted average discount rate

Operating leases 15.2 % 15.6 %

Finance leases — 9.2 %

Operating leases are included in Operating lease right-of-use assets, net, Operating lease liabilities, current portion and Operating lease liabilities, long term portion in the Company's Unaudited Condensed Consolidated Balance Sheets.

The Company’s lease arrangements primarily consist of corporate office, store, and vehicle lease agreements.

The leases expire on various dates through 2027.

Commitments and Contingencies

Legal Proceedings

The Company is, from time to time, subject to claims and disputes arising in the normal course of business.

In the opinion of management, the outcome of any such claims and disputes cannot be predicted with certainty.

As of September 30, 2024 and December 31, 2023, the Company had accrued legal contingencies o f $ 27.1 million an d $ 21.6 million, respectively, recorded within Accrued expenses and other current liabilities for potential financial exposure related to ongoing legal matters, primarily related to breach of contracts and employment matters, which are deemed both probable of loss and reasonably estimable.

For the legal matters involving third party vendors, such as suppliers and equipment manufacturers, the Company recorded an accrual in Accounts payable in the Condensed Consolidated Balance Sheets based on the amount invoiced by such vendors, which represents the minimum amount of loss out of the range of potential outcomes in accordance with ASC 450-20-30-1.

Legal Proceedings Against the Company

As of March 31, 2025 and December 31, 2024 , the Company had accrued legal contingencies of $ 6.6 million and $ 9.1 million , respectively, recorded within Accrued expenses and other current liabilities and Accounts payable for potential financial exposure related to ongoing legal matters, primarily related to breach of contracts and employment matters, which are deemed both probable of loss and reasonably estimable.

Class and Derivative Actions

1 unchanged sentence

f/k/a Property Solutions Acquisition Corp.

et al., Case No.

2:21-cv-009914 (U.S.

District Court – Central District of California).

On December 23, 2021, a putative class action lawsuit alleging violations of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) was filed in the United States District Court, Central District of California, against the Company and its former Chief Executive Officer and Chief Financial Officer, and its current Chief Product and User Ecosystem Officer, as well as the Co-CEOs of Property Solutions Acquisition Corp.

On December 23, 2021, a putative class action lawsuit alleging violations of the Exchange Act was filed in the United States District Court, Central District of California, against the Company and its former Chief Executive Officer and Chief Financial Officer, and its then-Chief Product and User Ecosystem Officer (who was promoted to Global Co-CEO in April 2025), as well as the Co-CEOs of Property Solutions Acquisition Corp.

On May 6, 2022, the appointed lead plaintiffs in the Zhou putative class action filed an amended complaint alleging violations of Sections 10(b), 14(a) and 20(a) of the Exchange Act, Sections 11 and 15 of the Securities Act , and related “control” person claims for secondary liability under those statutes, seeking unspecified damages.

On or about July 7, 2022, defendants filed a motion to dismiss the amended complaint, which the court granted in part and denied in part, finding, among other things, that the plaintiffs had failed to sufficiently plead a claim with respect to the alleged statements made as to the expected schedule for the production and delivery of the FF 91 vehicle, but had sufficiently alleged, for pleading purposes, a claim for violation of Sections 10(b), 14(a) and 20(a) of the Exchange Act with respect to certain statements made in 2021 concerning Legacy FF’s receipt of 14,000 reservations for the FF 91 vehicle.

On January 6, 2023, the plaintiffs declined to again amend their complaint to attempt to reallege the claims dismissed by the court, thereby making the operative complaint the one that was at issue in the motion to dismiss absent the judicially dismissed claims.

The Company and the other defendants filed answers to that compliant on February 10, 2023, following which the parties engaged in discovery.

Following motion to dismiss briefing and the subsequent court-ordered dismissal of several of the plaintiffs’ claims, answers were filed and the parties agreed to participate in mediation.

On April 27, 2023, the court granted the parties’ joint motion for a temporary stay pending mediation.

1 unchanged sentence

After further discussions and negotiations, the parties reached an agreement-in-principle to settle the Zhou putative class action.

Although denying all allegations, the Company nevertheless agreed to settle the Zhou putative class action for a non-reversionary cash payment of $ 7.5 million for the benefit of the settlement class to be funded entirely by the Company’s insurers, in exchange for the release of all claims asserted against the Company.

The court granted preliminary approval of the settlement on November 7, 2023, and scheduled a hearing for final approval of the settlement that took place on March 18, 2024.

On January 23, 2024, the ostensible lead plaintiff in the Consolidated Delaware Class Action discussed below, filed an Objection to final approval of the settlement (the “Objection”) to which the Company and the other defendants responded on March 11, 2024.

On March 18, 2024, the court overruled the Objection in its entirety and entered an Order finally approving the Zhou putative class action settlement.

Although denying all allegations, the Company nevertheless agreed to settle the Zhou putative class action for a non-reversionary cash payment of $ 7.5 million to be funded entirely by the Company’s insurers for the benefit of the settlement class, in exchange for the release of all claims that were or could have been asserted against the Company.

The court thereafter granted preliminary approval of the settlement on November 7, 2023, and scheduled a hearing for final approval of the settlement to take place on March 18, 2024.

On January 23, 2024, the ostensible lead plaintiff in the Consolidated

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Delaware Class Action discussed below, filed an Objection to final approval of the settlement (the “Objection”) to which the Company and the other defendants responded on March 11, 2024.

On March 18, 2024, the court overruled the Objection in its entirety and entered an Order finally approving the Zhou putative class action settlement.

Breitfeld et al.

13 unchanged sentences

Ashkan Farazmand and Wangjun Zhou v.

Breitfeld, et al.

Breitfeld, et al., Case No.

2023-1283 (Delaware Court of Chancery).

1 unchanged sentence

2:22-cv-1570 (the “California Federal Derivative Action”).

The California Federal Derivative Action was stayed pending resolution of certain proceedings in the Zhou putative class action, which stay expired in February 2023.

The California Federal Derivative Action was stayed pending resolution of certain proceedings in the Zhou putative class action discussed above, which stay expired in February 2023.

Plaintiffs thereafter filed a verified consolidated amended complaint on June 2, 2023, in response to which the Company and the other defendants filed a motion to dismiss.

On January 22, 2024, the court granted in part, and denied in part, the motion to dismiss with leave to amend.

On February 6, 2024, the parties filed a stipulation to stay the California Federal Derivative Action pending mediation (the “Global Derivative Actions Mediation”), which stipulation was subsequently entered by the court on February 12, 2024, and stayed the case until June 12, 2024, following which the proceedings remained dormant until the Stipulation and Agreement of Settlement discussed below (the “Global Derivative Actions Settlement”) was filed with the court.

On February 6, 2024, the parties filed a stipulation to stay the California Federal Derivative Action pending mediation that was entered by the court on February 12, 2024.

On April 11 (Moubarak) and April 25 (Wang), 2022, putative stockholder derivative lawsuits were respectively filed in the United States Delaware District Court (collectively, the “Delaware Federal Derivative Actions”).

On February 6, 2023, the Delaware Derivative Actions were stayed pending resolution of the then pending proceedings in the Zhou putative class action, and thereafter remained stayed until the filing of the Global Derivative Actions Settlement.

On February 6, 2023, the Delaware Derivative Actions were stayed pending resolution of the pending proceedings in the Zhou putative class action.

On June 21 (Wallace) and December 22 (Farazmand), 2023, putative derivative lawsuits were respectively filed in the Delaware Court of Chancery (collectively, the “Delaware State Derivative Actions”).

The parties stipulated to a stay of the Wallace action which was entered by the court on December 29, 2023.

The Company and the other defendants filed motions to dismiss on January 14, 2024 in the Farazmand action, following which the parties agreed to stay the action pending the Global Derivative Actions Mediation and the subsequent filing of the Global Derivative Actions Settlement.

Each of the foregoing derivative lawsuits (collectively, the “Derivative Actions”) purport to assert claims on behalf of the Company against certain of the Company’s current and former officers and directors for alleged violations of the Exchange Act or for various common law claims based upon those officers’ and directors’ alleged breaches of their purported fiduciary duties owed to the Company and/or for their alleged aiding and abetting of those purported breaches, each allegedly resulting in unspecified damages to the Company.

Although the complaints filed in the Derivative Actions vary in detail, they are generally premised upon many of the same underlying allegations made in the Zhou putative class action.

On May 13, 2024, the parties participated in the Global Derivative Actions Mediation, following which they reached a settlement in principle under which the amount of any monies paid to the plaintiffs’ counsel in the Derivative Actions are to be determined exclusively by the Court in a total collective amount not to exceed $ 0.8 million and to be funded entirely by the Company’s insurers in exchange for the release of all claims.

The parties subsequently finalized the documentation of that settlement and submitted that documentation to the court in the form of the Global Derivative Actions Settlement for its approval on July 19, 2024.

On September 3, 2024, the court issued an order preliminarily approving the Global Derivative Actions Settlement and scheduled a hearing for final approval of that settlement that was held on November 6, 2024.

Upon final approval of the Global Derivative Actions Settlement, each of the Derivative Actions will be dismissed, with prejudice.

Each of the foregoing derivative lawsuits purported to assert claims on behalf of the Company against certain of the Company’s current and former officers and directors for alleged violations of the Exchange Act or for various common law claims based upon those officers’ and directors’ alleged breaches of their purported fiduciary duties owed to the Company and/or for their alleged aiding and abetting of those purported breaches, resulting in unspecified damages to the Company.

Although the complaints filed in the foregoing lawsuits vary in detail, they are generally premised upon many of the same underlying allegations made in the Zhou putative class action.

The parties to the foregoing derivative lawsuits participated in a mediation on May 13, 2024, following which they reached a settlement in principle.

On July 19, 2024, the parties entered into a Stipulation and Agreement of Settlement that was filed in the California Federal Derivative Action, which incorporated all of the foregoing derivative lawsuits respectively filed in California and Delaware.

On September 3, 2024, the California Federal Derivative Action Court entered an order preliminarily approving the Stipulation and Agreement of Settlement (the “Preliminary Approval Order”) and provided for notice of the same to be made to Current Stockholders.

On October 30, 2024, the California Federal Derivative Action Court approved the Settlement Agreement, resolving all of the foregoing derivative lawsuits.

Following the approval of the Settlement Agreement, the California Federal Derivative Action was dismissed on October 30, 2024 and the Delaware Federal Derivative Actions were dismissed on November 15, 2024 (Wang) and November 19, 2024 (Moubarak).

On December 31, 2024, the parties in the Farazmand filed a stipulation of dismissal which was subsequently entered by the court.

The Consolidated Delaware Class Action

On June 14, 2022, a verified stockholder class action complaint was filed in the Delaware Court of Chancery against, among others, the Company, its former Global CEO and CFO, and its current Chief Product and User Ecosystem Officer alleging breaches of fiduciary duties (the “Yun Class Action”).

On September 21, 2022, a second verified stockholder class action complaint was filed in the Delaware Court of Chancery against, among others, FFIE, the Co-CEOs and independent directors of PSAC, and certain third-party advisors to PSAC, alleging breaches of fiduciary duties, and aiding and abetting alleged breaches, in connection with disclosures and stockholder voting leading up to the PSAC/Legacy FF merger (the

On June 14, 2022, a verified stockholder class action complaint was filed in the Delaware Court of Chancery against, among others, the Company, its former Global CEO and CFO, and its then-Chief Product and User Ecosystem Officer (who was promoted to Global Co-CEO in April 2025), alleging breaches of fiduciary duties (the “Yun Class Action”).

On September 21, 2022, a second verified stockholder class action complaint was filed in the Delaware Court of Chancery against, among others, the Company, the Co-CEOs and independent directors of PSAC, and certain third-party advisors to PSAC, alleging breaches of fiduciary duties, and aiding and abetting those alleged breaches, in connection with disclosures and stockholder voting leading up to the PSAC/Legacy FF merger (the “Cleveland Class Action”).

The Cleveland and Yun Class Actions subsequently were consolidated the complaint in the Cleveland Class Action being designated as the operative pleading (collectively, the “Consolidated Delaware Class Action”).

In April 2023, the defendants respectively filed motions to dismiss that complaint.

While the defendants’ motions to dismiss were pending, the Central District of California approved the Zhou putative class action settlement.

On May 24, 2024, the defendants in the Consolidated Delaware Class Action filed a motion for

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

“Cleveland Class Action”).

The Yun and Cleveland Class Actions subsequently were consolidated, with the complaint in the Cleveland Class Action being designated as the operative pleading (collectively, the “Consolidated Delaware Class Action”).

In April 2023, the defendants respectively filed motions to dismiss the complaint, and thereafter filed a consolidated motion for summary judgment and a motion to stay discovery in the action in May 2024.

Each of the foregoing motions were heard by the Delaware Court of Chancery on November 6, 2024 and remain pending with the Court.

The Company maintains that the Consolidated Delaware Class Action is without merit and has stated its intention to vigorously defend that action.

The Company has not concluded that an adverse outcome in these matters is either “probable” or “remote” within the meaning of the ABA Statement of Policy and, accordingly, declines to express any view as to the possible outcome of that matter.

Additionally, on September 19, 2022, FF Global filed a lawsuit in the Chancery Court of the State of Delaware against FFIE, seeking the removal of Ms.

summary judgment based upon the court-approved settlement agreement in Zhou putative class action on the grounds that among other things, the releases of that settlement agreement barred the claims in the Consolidated Delaware Class Action.

On February 10, 2025, the Delaware Court of Chancery granted summary judgment and dismissed the Consolidated Delaware Class Action both in its entirety and with prejudice.

Additionally, on September 19, 2022, FF Global, filed a lawsuit in the Chancery Court of the State of Delaware against the Company, seeking the removal of Ms.

Susan Swenson and Mr.

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On October 3, 2022, Mr.

Jordan Vogel also tendered his resignation from the Board effective on October 5, 2022 upon his receipt of a supplemental release pursuant to the Mutual Release.

Jordan Vogel also tendered his resignation from the Board effective on October 5, 2022.

On October 28, 2022, Mr.

Brian Krolicki tendered his resignation from the Board effective immediately.

Legal Proceedings Initiated by the Company

The Company has determined there to be financial exposure related to an ongoing legal matter, primarily arising from the bankruptcy of a key supplier.

The exposure involves previously recorded deposits and tooling equipment, which have since become subject to legal contingency considerations due to the supplier’s insolvency.

The Company initially recorded $ 1.9 million in deposits and $ 12.9 million in tooling equipment in connection with its contractual relationship with a primary supplier.

These amounts were originally recognized as a deposit paid for goods and services and tooling received, respectively, and continue to be reflected in their originally recorded accounts on the Consolidated Balance Sheets.

However, following the primary supplier’s bankruptcy filing, these balances were identified as at risk, creating potential financial exposure for the Company.

The $ 2.7 million charge consists of a $ 1.4 million write-off of deposits and a $ 1.3 million accrual for additional payments the Company expects to have to make to maintain access to its tooling located at vendors of the key supplier (the “secondary suppliers”).

The $ 1.4 million write-off of deposits reflects the Company's estimate that recovery of that asset is not probable and leaves a remaining exposure of $ 0.5 million.

The Company does not expect any further financial loss related to tooling.

Although the Company has title to the tooling;

the secondary suppliers have possession of it.

The Company anticipates establishing a direct contractual arrangement with the secondary suppliers.

Once in place, these agreements are expected to provide the Company with continued access to the tooling without additional financial exposure.

Legal Action Against Tesca USA and Tesca ABC

On March 6, 2025, Faraday&Future Inc.

(“Faraday”) filed a demand for arbitration against Tesca USA, Inc.

and Tesca ABC, LLC alleging the breach of an Engineering Services Agreement (“ESA”) between Tesca USA and Faraday&Future Inc., under which Tesca USA was obligated to produce certain items related to automobile seating assembly and frame production.

Pursuant to the ESA, Faraday paid Tesca USA approximately $ 36.0 million for certain parts, tooling, engineering design and development, and other items.

According to a Verified Petition Regarding Assignment for the Benefit of Creditors filed in May 2024, Tesca USA, after failing to deliver any of these products or services to Faraday, assigned all its assets to Tesca ABC, a Delaware series limited liability company.

Faraday has reason to suspect that Tesca USA may have made one or more large cash transfers to Tesca Group before it commenced the Assignment for Benefit of Creditors.

Faraday is seeking in excess of $ 36.0 million in damages through this arbitration.

The Company is unable to evaluate the likelihood of a favorable outcome given the early stages of these legal proceedings.

Governance Matters

Following the completion of the Special Committee (as defined below) investigation through the date hereof, the Company and certain of its directors and officers have received numerous e-mail communications from a group of self-described “employee whistleblowers” and from various individuals and entities who represented themselves as current investors of the Company.

These communications have included various allegations (including, for example, that certain directors have conspired to attempt to push the Company into bankruptcy for their own personal gain) and requests for certain organizational and governance changes.

The Company engaged an independent law firm to conduct a thorough independent external investigation with respect to these allegations, which independent investigation found that all such allegations have been without merit.

These communications have included various allegations (including, for example, that certain directors have conspired to push the Company into bankruptcy for their own personal gain) and requests for certain organizational and

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

governance changes.

The Company engaged an independent law firm to conduct a thorough independent external investigation with respect to these allegations.

The independent investigation found that all such allegations have been without merit.

Other Legal Matters

On January 30, 2023, Riverside Management Group, LLC (“Riverside”) filed a verified complaint seeking to enforce its alleged contractual right to the advancement of all reasonable costs and expenses, including attorney’s fees, it has and will incur as a named defendant in the Consolidated Delaware Class Action under its October 13, 2020 Transaction Services Agreement with FFIE and Property Solutions Acquisition Sponsor, LLC (the “TSA”), pursuant to which Riverside provided PSAC with advisory services in connection with the PSAC/Legacy FF merger.

In addition to seeking the advancement of such costs and expenses, Riverside also sought an award of its attorney’s fees and costs incurred in enforcing its alleged advancement rights under the TSA, and concurrently filed a Motion for Expedited Proceedings, requesting that trial of the action be conducted on a summary basis and commence within 30 days of the motion’s disposition.

The Company entered into a Stipulation and Order with Riverside under which it would conditionally advance Riverside the reasonable attorney’s fees and costs it incurs in defense of the Consolidated Delaware Action, subject to, and in express reservation of, the Company’s right to recover all such fees and expenses following disposition of the Consolidated Delaware Class Action.

On May 30, 2023, th e Company filed a Motion to Compel Arbitration.

Given the early stages of the legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

On January 30, 2023, Riverside Management Group, LLC (“Riverside”) filed a verified complaint seeking to enforce its alleged contractual right to the advancement of all reasonable costs and expenses, including attorneys’ fees, it has and will incur as a named defendant in the Consolidated Delaware Class Action under its October 13, 2020 Transaction Services Agreement with the Company and Property Solutions Acquisition Sponsor, LLC (the “TSA”), pursuant to which Riverside provided PSAC with advisory services in connection with the PSAC/Legacy FF merger.

In addition to seeking the advancement of such costs and expenses, Riverside also sought an award of its attorneys’ fees and costs incurred in enforcing its alleged advancement rights under the TSA, and concurrently filed a Motion for Expedited Proceedings, requesting that trial of the action be conducted on a summary basis and commence within 30 days of the motion’s disposition.

The Company subsequently entered into a Stipulation and Order with Riverside under which it would conditionally advance Riverside the reasonable attorneys’ fees and costs it incurs in defense of the Consolidated Delaware Action, subject to, and in express reservation of, the Company’s right to recover all such fees and expenses following disposition of the Consolidated Delaware Class Action which, as noted above, was recently dismissed, with prejudice, on summary judgment by the Delaware Chancery Court.

On January 31, 2023, Raymond Handling Solutions, Inc.

(“Raymond”), an equipment supplier, filed an action alleging that the Company breached its contract with Raymond and refused to pay for warehouse racking equipment.

Raymond requested a judgment in its favor in the amount of $ 1.1 million.

The Company defaulted on the payment plan and a trial had been set for July 2024 to resolve the matter.

On April 15, 2024, the Company and Raymond executed a Settlement Agreement in order to release all claims in exchange for the return of racks.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

In July 2021, the Company and Palantir Technologies, Inc.

(“Palantir”) entered into a Master Subscription Agreement (“MSA”) setting forth the terms of the Palantir platform hosting arrangement that was expected to be used as a central operating system for data and analytics.

On April 26, 2023, the Company received a letter from Palantir providing a notice of dispute alleging that the Company had not paid outstanding invoices totaling $ 12.3 million.

On July 7, 2023, Palantir filed a Demand for Arbitration against the Company with Judicial Arbitration and Mediations Services, Inc.

regarding the parties’ dispute under the MSA in which Palantir asserted that the amount in controversy was $ 41.5 million.

Raymond requested a judgement in its favor in the amount of $ 1.1 million .

On April 15, 2024, the Company and Raymond executed a Settlement Agreement under which Raymond released all claims in exchange for the return the of racking equipment.

In July 2021, the Company and Palantir entered into a Master Subscription Agreement (“MSA”) setting forth the terms of the Palantir platform hosting arrangement which was expected to be used as a central operating system for data and analytics.

On April 26, 2023, the Company received a letter from Palantir Technologies Inc.

(“Palantir”) providing a notice of dispute alleging that the Company had not paid outstanding invoices totaling $ 12.3 million .

On July 7, 2023, Palantir filed a Demand for Arbitration against the Company with Judicial Arbitration and Mediation Services, Inc., regarding the parties’ dispute under the MSA in which it alleged that the amount in controversy was $ 41.5 million .

On August 4, 2023, the Company submitted its response to Palantir’s arbitration demand, which response included both affirmative defenses and a general denial of all allegations of Palantir’s arbitration demand.

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This settlement includes mutual waivers and releases of claims to avoid future disputes.

On August 9, 2024, the Company and Palantir entered into an amendment to the Settlement and Release Agreement pursuant to which, in lieu of paying the remaining $ 4.8 million due under the Settlement and Release Agreement in cash, the parties agreed that the Company would issue, and Palantir would accept, $ 2.4 million of Class A Common Stock by August 9, 2024, and $ 2.4 million in Class A Common Stock by October 1, 2024.

The Company delivered the shares to Palantir.

On August 9, 2024, the Company and Palantir entered into an amendment to the Settlement and Release Agreement pursuant to which, in lieu of paying the remaining $ 4.8 million due under the settlement agreement in cash, the parties agreed that the Company would issue, and Palantir would accept, $ 2.4 million of Class A Common Stock by August 9, 2024, and $ 2.4 million in Class A Common Stock by October 1, 2024.

The August 9, 2024 issuance totaled approximately 11.1 million shares of Common Stock.

The Company further agreed to register the shares under the Securities Act for resale by Palantir.

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Envisage was ultimately awarded a total of $ 1.4 million .

The parties are currently engaged in settlement negotiations.

The parties have reached an agreement to settle their dispute for $ 0.8 million .

On June 12, 2023, the Company received a letter demanding access to the Company’s books and records in connection with (a) the Company entering into the amended and restated shareholder agreement with FF Top Holding LLC n/k/a FF Global and (b) certain other related matters.

Given the early stages of the legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

Given the early stages of the legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome.

On June 13, 2023, L & W LLC (“Autokiniton”), a provider of tooling for use in the automotive industry, filed an action in State of Michigan 3rd Judicial Circuit County of Wayne Court alleging the Company breached its contract with Autokiniton and refused to fulfill its obligations under the applicable Purchase Order.

Autokiniton requested a judgment in the amount of at least $ 8.1 million .

In discovery, the Company has conceded that $ 4.6 million is due and owing under the Purchase Order.

In July 2024, the parties subsequently filed a stipulated order and judgment totaling $ 8.1 million, plus statutory interest, which was entered by the court.

In discovery, the Company conceded that $ 4.6 million was due and owing under the Purchase Order.

In July 2024, the parties subsequently filed a stipulated order and judgment totaling $ 8.1 million , plus statutory interest, which was

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

entered by the court.

The parties are engaged in discussions regarding this matter.

The Company has accrued $ 8.1 million related to this matter in the Accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets for the period ended September 30, 2024.

In December 2024, the parties reached an agreement to settle their dispute for $ 3.7 million .

On October 11, 2023, Joseph Hof and Scott McPherson filed a class action lawsuit in Supreme Court of the State of New York, County of New York against Benchmark 237 LLC, Benchmark Real Estate Trust, SLLC, Canvas Investment Partners, LLC, Canvas Property Group, LLC, Juliet Technologies, LLC, and the Company, alleging that the defendants engaged in various scheming practices that discriminatorily impacted the plaintiffs and other class members The court granted the Company’s Motion to Dismiss on January 12, 2024, and dismissed the case on January 18, 2024.

The plaintiffs filed an appeal on February 12, 2024 as to the dismissal orders but did not timely file their appellate briefs, so their appeal was dismissed.

Plaintiffs nevertheless have a year to file a motion to vacate the dismissal by showing good cause.

At this time, the Company is unable to evaluate the likelihood that the plaintiffs will file such a motion.

On December 8, 2023, 10701 Idaho Owner, LLC (“Landlord”) notified the Company of rental defaults amounting to $ 0.6 million for the months of October to December 2023, demanding a 5 % late fee and 18 % annual interest on overdue amounts.

Following this, the parties reached a First Amendment to the Lease Agreement dated October 19, 2023 to address the Company’s total rent default of $ 1.1 million, including a $ 0.1 million partial payment made on January 26, 2024, and additional late fees and charges of $ 0.2 million.

The plaintiffs filed an appeal on February 12, 2024 as to the dismissal orders, which appeal subsequently was dismissed due to the plaintiffs’ failure to timely file their appellate briefs.

Although Plaintiffs have a year to file a motion to vacate the dismissal based upon a showing good cause, Plaintiff Hof recently filed a motion to seal the record and expressed the Plaintiffs’ desire to cease litigating the matter further.

On December 8, 2023, 10701 Idaho Owner, LLC (“Landlord”) notified the Company of rental defaults amounting to $ 0.6 million for the months of October to December 2023 and demanded a 5 % late fee and 18 % annual interest on allegedly overdue amounts.

The parties thereafter entered into a First Amendment to the Lease Agreement dated October 19, 2023 to address the Company’s total rent default of $ 1.1 million , including a $ 0.1 million , partial payment made on January 26, 2024, and additional late fees and charges of $ 0.2 million .

The amendment established a repayment plan requiring the Company to pay $ 1.2 million from February 26 to March 31, 2024, and to either replenish or provide a new $ 0.6 million Letter of Credit.

On March 26, 2024, the Landlord served the Company with a Notice to Pay or Quit, demanding payment of $ 1.0 million within five business days.

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Notes to Unaudited Condensed Consolidated Financial Statements

On April 10, 2024, the Company made a $ 0.2 million payment to Landlord in exchange for Landlord deferring further action in this matter.

On February 14, 2024, Rexford Industrial - 18455 Figueroa, LLC (“Rexford”) filed a Complaint for Unlawful Detainer against Faraday SPE, LLC in Superior Court of California, County of Los Angeles.

The complaint asserted that the Company had failed to pay outstanding rent in the amount of $ 0.9 million.

Furthermore, Rexford sought recovery of reasonable attorney’s fees and damages.

This action was based on a breach of a Lease Agreement dated March 8, 2019, for premises at 18455 S.

Figueroa Street, Gardena, Los Angeles, with Rexford requesting forfeiture of the lease.

On April 10, 2024, the court issued a Notice of Dismissal, dismissing the complaint without prejudic e.

On April 10, 2024, the Company made a $ 0.2 million payment to Landlord in exchange for Landlord deferring further action.

On February 14, 2024, Rexford Industrial - 18455 Figueroa, LLC (“Rexford”) filed a Complaint for Unlawful Detainer against Faraday SPE, LLC in the Superior Court of California, County of Los Angeles.

The complaint asserted that the Company has failed to pay outstanding rent in the amount of $ 0.9 million , and sought recovery of reasonable attorney’s fees and damages.

This action is based on a breach of a Lease Agreement dated March 8, 2019, for the premises located at 18455 S.

Figueroa Street, Gardena, California, and wherein Rexford is requesting forfeiture of the lease.

On April 10, 2024, the court issued a Notice of Dismissal, dismissing the Complaint without prejudice.

In February 2024, the Company initiated a lawsuit against Draexlmaier Automotive Technologies of America LLC (“Draexlmaier”) for breach of contract, seeking $ 3.2 million in damages plus legal costs incurred.

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On March 25, 2024, Cooper Standard GmbH filed a lawsuit against Faraday&Future Inc.

in Superior Court of California, County of Los Angeles, alleging non-payment of the estimated sum of $ 1.5 million purportedly in breach of contractual obligations set forth in purchase orders, a Letter of Tool Acceptance, and invoices to facilitate the supply of automotive products and services for the FF 91 vehicle from August 2021 to December 2022.

Given the early stages of the legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

in Superior Court of California, County of Los Angeles, alleging the non-payment of the estimated sum of $ 1.5 million that was purportedly in breach of contractual obligations set forth in purchase orders, a Letter of Tool Acceptance, and invoices to facilitate the supply of automotive products and services for the FF 91 vehicle from August 2021 to December 2022.

The parties have tentatively reached a settlement and are in the process of memorializing their agreement.

On March 27 and March 29, 2024, Jose Guerrero and Victoria Xie, the Company’s former Senior Director of Sales and Aftersales, and Go-to-Market Project Manager and Launch Manager, respectively, filed wrongful termination lawsuits against Faraday&Future Inc.

and certain of its officers in Superior Court of California, County of Los Angeles, each of which seek compensatory, general, and special damages in an amount not less than $ 1.0 million.

On April 19, 2024, an additional former employee, Karimul Khan, submitted a request for arbitration against the same group of defendants without quantifying the alleged damages sought.

and certain of its officers in Superior Court of California, County of Los Angeles, each of which seeks compensatory, general, and special damages in an amount not less than $ 1.0 million .

On April 19, 2024, another former employee, Karimul Khan, submitted a request for arbitration against the same group of defendants without quantifying the alleged damages sought.

Given the early stages of these legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

On August 9, 2024, Jeffrey D.

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The plaintiff is demanding inspection to allegedly value his shares of the Company.

Given the early stages of the legal proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

On August 1, 2024, Yun Han, the Company’s former Chief Accounting Officer and Interim Chief Financial Officer, filed an arbitration demand claiming that she is owed certain monetary amounts and restricted stock units, totaling approximately $ 1.2 million pursuant to various agreements with the Company.

In March 2025, plaintiff agreed to dismiss the lawsuit without prejudice and a stipulation to dismiss was filed and granted.

On August 1, 2024, Yun Han, former Chief Accounting Officer and Interim Chief Financial Officer, filed an arbitration demand claiming that she is owed certain monetary amounts and restricted stock units, pursuant to various agreements with the Company and collectively, totaling approximately $ 1.2 million .

Given the early stages of the proceedings, the Company is unable to evaluate the likelihood of an unfavorable outcome and/or the amount or range of potential loss.

In March 2025, BXP filed a lawsuit against the Company, alleging unpaid rent and a balance of approximately $ 1.0 million under a lease agreement signed with the Company.

The parties agreed to settle their dispute for $ 0.35 million.

Dispute with Noteholders

In August 2023, and September 2023, the Company received correspondence from each of Senyun, MHL and V W Investment alleging that the Company had entered into oral agreements to compensate those investors for any losses in connection with converting their notes into shares of the Company in order to support the Company’s proposals at the August

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

2023 special stockholders meeting.

In August 2023 and September 2023, the Company received correspondence from each of Senyun, MHL and V W Investment alleging that the Company had entered into oral agreements to compensate those investors for any losses in connection with converting their notes into shares of the Company in order to support the Company’s proposals at the August 2023 special stockholders meeting.

The Company is unaware of any such oral agreements and is contesting these claims on multiple grounds.

Other than disclosed herein, as of the date hereof, FF is not a party to any legal proceedings the outcome of which, if determined adversely to FF, would individually or in the aggregate be reasonably expected to have a material adverse effect on FF’s business, financial condition, or results of operations.

Other than disclosed herein, as of the date hereof the Company is not a party to any legal proceedings the outcome of which, if determined adversely to the Company, would individually or in the aggregate be reasonably expected to have a material adverse effect on the Company’s business, financial condition, or results of operations.

Special Committee Investigation

As previously disclosed on November 15, 2021, the Board established a special committee of independent directors (“Special Committee”) to investigate allegations of inaccurate Company disclosures, including those made in an October 2021 short seller report and whistleblower allegations, which resulted in FFIE being unable to timely file its third quarter 2021 Quarterly Report on Form 10-Q, Annual Report on Form 10-K for the year ended December 31, 2021, first quarter 2022 Quarterly Report on Form 10-Q and amended Registration Statement on Form S-1 (File No.

As previously disclosed on November 15, 2021, the Board established a special committee of independent directors (“Special Committee”) to investigate allegations of inaccurate Company disclosures, including those made in an October 2021 short seller report and whistleblower allegations, which resulted in the Company being unable to timely file its third quarter 2021 Quarterly Report on Form 10-Q, Annual Report on Form 10-K for the year ended December 31, 2021, first quarter 2022 Quarterly Report on Form 10-Q and amended Registration Statement on Form S-1 (File No.

The Special Committee engaged outside independent legal counsel and a forensic accounting firm to assist with its review.

On February 1, 2022, FFIE announced that the Special Committee completed its review.

On April 14, 2022, FFIE announced the completion of additional investigative work based on the Special Committee’s findings which was performed under the direction of the Executive Chairperson, reporting to the Audit Committee.

On February 1, 2022, the Company announced that the Special Committee completed its review.

On April 14, 2022, the Company announced the completion of additional investigative work based on the Special Committee’s findings which was performed under the direction of the Executive Chairperson, reporting to the Audit Committee.

In connection with the Special Committee’s review and subsequent investigative work, the following findings were made:

In connection with the business combination that was consummated on July 21, 2021 pursuant to that certain Agreement and Plan of Merger, dated as of January 27, 2021 (as amended, the “Merger Agreement”), by and among the Company, formerly known as Property Solutions Acquisition Corp (“PSAC”), PSAC Merger Sub Ltd., and FF Intelligent Mobility Global Holdings Ltd., an exempted company with limited liability incorporated under the laws of the Cayman Islands (“Legacy FF”) (the “Business Combination”), statements made by certain Company employees to certain investors describing the role of Mr.

• In connection with the Business Combination, statements made by certain Company employees to certain investors describing the role of Mr.

Yueting Jia, within the Company were inaccurate and his involvement in the management of the Company post-Business Combination was more significant than what had been represented to certain investors.

• The Company’s statements leading up to the Business Combination that it had received more than 14,000 reservations for the FF 91 vehicle were potentially misleading because only several hundred of those reservations were paid, while the others (totaling 14,000 ) were unpaid indications of interest.

• Consistent with FFIE’s previous public disclosures regarding identified material weaknesses in its internal control over financial reporting, the Company’s internal control over financial reporting required an upgrade in personnel and systems.

• Consistent with the Company’s previous public disclosures regarding identified material weaknesses in its internal control over financial reporting, the Company’s internal control over financial reporting required an upgrade in personnel and systems.

• The Company’s corporate culture failed to sufficiently prioritize compliance.

Jia’s role as an intermediary in leasing certain properties which were subsequently leased to the Company was not disclosed in FFIE’s corporate housing disclosures.

• In preparing FFIE’s related party transaction disclosures, the Company failed to investigate and identify the sources of loans received from individuals and entities associated with Company employees.

In addition, the investigation found that certain individuals failed to fully disclose to individuals involved in the preparation of FFIE’s SEC filings their relationships with certain related parties and affiliated entities in connection with, and following, the Business Combination, and failed to fully disclose relevant information, including but not limited to, information in connection with related parties and corporate governance to FFIE’s former independent registered public accounting firm PricewaterhouseCoopers LLP.

The investigation also found that certain individuals failed to cooperate and withheld potentially relevant information in connection with the Special Committee investigation.

Among such individuals were non-executive officers or members of the management team of FF, and remedial action was taken with respect to such individuals based on the extent of their non-cooperation and/or withholding of information.

The failure to cooperate with the investigation was taken into consideration in connection with the remedial actions outlined below with respect to Jerry Wang, and withholding of information also affected the remedial action taken with respect to Matthias Aydt.

Jia’s role as an intermediary in leasing certain properties which were subsequently leased to the Company was not disclosed in the Company’s corporate housing disclosures.

• In preparing the Company’s related party transaction disclosures, the Company failed to investigate and identify the sources of loans received from individuals and entities associated with Company employees.

In addition, the investigation found that certain individuals failed to fully disclose to individuals involved in the preparation of the Company’s SEC filings their relationships with certain related parties and affiliated entities in connection with, and following, the Business Combination, and failed to fully disclose relevant information, including but not limited to, information in connection with related parties and corporate governance to the Company’s former independent registered public accounting firm PricewaterhouseCoopers LLP.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Based on the results of the investigation, the Special Committee concluded that, except as described above, the other substantive allegations of inaccurate FF disclosures that it evaluated were not supported by the evidence reviewed.

Although the investigation did not change any of the above findings with respect to the substantive allegations of inaccurate FF disclosures, the investigation did confirm the need for remedial actions to help ensure enhanced focus on compliance and disclosure within FF.

The investigation also found that certain individuals failed to cooperate and withheld potentially relevant information in connection with the Special Committee investigation.

Among such individuals were non-executive officers or members of the management team of the Company, and remedial action was taken with respect to such individuals based on the extent of their non-cooperation and/or withholding of information.

Based on the results of the investigation, the Special Committee concluded that, except as described above, the other substantive allegations of inaccurate Company disclosures that it evaluated, were not supported by the evidence reviewed.

Although the investigation did not change any of the above findings with respect to the substantive allegations of inaccurate Company disclosures, the investigation did confirm the need for remedial actions to help ensure enhanced focus on compliance and disclosure within the Company.

Based on the results of the Special Committee investigation and subsequent investigative work described above, the Board approved the following remedial actions designed to enhance oversight and corporate governance of the Company:

• the appointment of Susan Swenson, a former member of the Board, to the then newly created position of Executive Chairperson of FF.

Carsten Breitfeld, FF’s former Global CEO, reporting directly to Ms.

• the appointment of Susan Swenson, a former member of the Board, to the then newly created position of Executive Chairperson of the Company.

Carsten Breitfeld, the Company’s former Global CEO, reporting directly to Ms.

Swenson and receiving a 25 % annual base salary reduction;

• the removal of Mr.

Jia as an executive officer, who would continue in his position as Chief Product and User Ecosystem Officer of FFIE.

Jia as an executive officer, who would continue in his position as Chief Product & User Ecosystem Officer of the Company.

Certain dual-reporting arrangements were eliminated with respect to Mr.

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Swenson, a non-independent director nominated by FF Top.

Please see “ Risk Factors–Risks Related to FF’s Business and Industry–Yueting Jia and FF Global, over which Mr.

Jia exercises significant influence, have control over the Company’s management, business and operations, and may use this control in ways that are not aligned with the Company’s business or financial objectives or strategies or that are otherwise inconsistent with the Company’s interests.

Such significant influence may increase if and to the extent the current members of the Board and management are removed and replaced with individuals who are aligned with Mr.

Jia and/or FF Global ” in the Form 10-K.

Jia also received a 25 % annual base salary reduction, and his role was limited from a policy-making position to focusing on (a) Product and Mobility Ecosystem;

and (b) Internet, Artificial Intelligence, and Advanced R&D technology.

Please see “Risk Factors– Risks Related to our Business and Industry–Yueting Jia and FF Global, over which Mr.

Jia exercises significant influence, have control over our management, business and operations, and may use this control in ways that are not aligned with our business or financial objectives or strategies or that are otherwise inconsistent with our interests.

Jia also received a 25 % annual base salary reduction, and his role was limited from a policy-making position to focusing on (a) Product and Mobility Ecosystem and (b) Internet, Artificial Intelligence, and Advanced R&D technology.

On February 26, 2023, after an assessment by the Board of the Company’s management structure, the Board approved Mr.

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Xuefeng Chen) reporting directly to the Board, as well as FF’s product, mobility ecosystem, I.A.I., and advanced R&D technology departments reporting directly to Mr.

The Board also approved FF’s user ecosystem, capital markets, human resources and administration, corporate strategy and China departments reporting to both Mr.

Chen processes and controls to be determined by the Board after consultation with the Company’s management.

The Company’s remaining departments continued to report to Mr.

Based on the foregoing changes to his responsibilities within the Company, the Board determined that Mr.

The Board also approved the Company’s user ecosystem, capital markets, human resources and administration, corporate strategy and China departments reporting to both Mr.

Xuefeng in accordance with processes and controls to be determined by the Board after consultation with the Company’s management.

Based on the changes to his responsibilities within the Company, the Board determined that Mr.

Jia is an “officer” of the Company within the meaning of Section 16 of the Exchange Act and an “executive officer” of the Company under Rule 3b-7 under the Exchange Act;

• Matthias Aydt, then Senior Vice President, Business Development and Product Definition and a director of FFIE, and currently Senior Vice President, Product Execution and a director of FFIE, being placed on probation as an executive officer for a six-month period, during which period he remained a non-independent member of the Board, and which probationary period has since ended;

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

• On April 25 2025, the Company announced the appointment of Mr.

Yueting Jia as Global Co-Chief Executive Officer ("Global Co-CEO"), jointly leading the Company alongside Matthias Aydt, with a focus on advancing user ecosystem development, supply chain management, EV R&D, finance, legal, and China and Middle East operations;

• Matthias Aydt, then Senior Vice President, Business Development and Product Definition and a director of the Company, and currently Global Co-CEO and a director of the Company, being placed on probation as an executive officer for a six -month period, during which period he remained a non-independent member of the Board, and which probationary period has since ended;

• the appointment of Jordan Vogel as Lead Independent Director;

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and Scott Vogel becoming the Chair of the Audit Committee and the Nominating and Corporate Governance Committee of the Board;

• the suspension, without pay, of Jiawei (“Jerry”) Wang, FFIE’s former Vice President, Global Capital Markets, who subsequently notified the Board of his decision to resign from FF on April 10, 2022;

• the assessment and enhancement of FF’s policies and procedures regarding financial accounting and reporting and the upgrading of FF’s internal control over financial accounting and reporting, including by hiring additional financial reporting and accounting support, in each case at the direction of the Audit Committee;

• the implementation of enhanced controls around FF’s contracting and related party transactions, including regular attestations by FF’s employees with authority to bind FF to contracts and related party transactions, for purposes of enabling FF to make complete and accurate disclosures regarding related party transactions;

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

• the hiring of a Compliance Officer with the title of Deputy General Counsel (hired in March 2023), who will report on a dotted line to the Chair of the Audit committee, and a Director of Risks and Internal Controls;

• the suspension without pay of Jiawei (“Jerry”) Wang, the Company’s former Vice President, Global Capital Markets, who subsequently notified the Board of his decision to resign from the Company on April 10, 2022, but remained with the Company as a consultant and was subsequently appointed President of the Company on March 24, 2025;

• the assessment and enhancement of Company’s policies and procedures regarding financial accounting and reporting and the upgrading of the Company’s internal control over financial accounting and reporting, including by hiring additional financial reporting and accounting support, in each case at the direction of the Audit Committee;

• the implementation of enhanced controls around the Company’s contracting and related party transactions, including regular attestations by the Company’s employees with authority to bind the Company to contracts and related party transactions, for purposes of enabling the Company to make complete and accurate disclosures regarding related party transactions;

• the hiring of a Compliance Officer with the title of Deputy General Counsel (hired in March 2023), to report on a dotted line to the Chair of the Audit committee, and a Director of Risks and Internal Controls;

and assessing and enhancing FF’s compliance policies and procedures;

• the implementation of a comprehensive training program for all directors and officers regarding, among other things, internal FF policies;

• the implementation of a comprehensive training program for all directors and officers regarding, among other things, internal Company policies;

• the separation of Jarret Johnson, FF’s Vice President, General Counsel and Secretary;

• certain other disciplinary actions and terminations of employment with respect to other FF employees (none of whom is an executive officer).

FF is continuing to implement certain of the remedial actions approved by the Board.

• certain other disciplinary actions and terminations of employment with respect to other Company employees (none of whom is an executive officer).

As of March 3, 2025, the Company is continuing to implement certain of the remedial actions approved by the Board.

However, certain of these remedial actions are no longer in effect and no assurance can be provided that those remedial measures that continue to be implemented will be implemented in a timely manner or at all or will be successful to prevent inaccurate disclosures in the future.

Please see “ Risk Factors – Risks Related to FF’s Business and Industry – FF has taken remedial measures in response to the Special Committee findings.

Please see “ Risk Factors – Risks Related to our Business and Industry – We have taken remedial measures in response to the Special Committee findings, which may be unsuccessful ” included in the Form 10-K.

There can be no assurance that such remedial measures will be successful.

In addition, there can be no assurance that such remedial measures will be fully implemented in light of the recent corporate governance agreements with FF Top and FF Global and the recent assessment by the Board of FF’s management structure, including management roles, responsibilities and reporting lines and changes to the Board” in the Form 10-K.

However, pursuant to the Heads of Agreement, FF has implemented certain governance changes that impact certain of the above-discussed remedial actions.

On October 3, 2022, Ms.

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Scott Vogel resigned from the Board effective immediately and Mr.

Jordan Vogel resigned effective on October 5, 2022 upon his receipt of a supplemental release pursuant to the Mutual Release.

Jordan Vogel resigned effective on October 5, 2022.

On October 28, 2022, Mr.

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Sheng and Ms.

Sun are designees of FF Top pursuant to the Amended and Restated Shareholder Agreement by and between FF and FF Top (the “Amended Shareholder Agreement”).

Sun are designees of FF Top pursuant to the Amended Shareholder Agreement.

On December 26, 2022, Dr.

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Qing Ye tendered his resignation from the Board, which resignation was effective immediately.

Ye remained a consultant of the Company as an independent contractor until November 18, 2023.

Ye remained a consultant of the Company as an independent contractor until

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

November 18, 2023.

On January 25, 2023, Mr.

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Xuefeng Chen have subsequently resigned from the Board.

See “ Management – Governance Agreement with FF Top and FF Global ” for more information.

Subsequent to FFIE announcing the completion of the Special Committee investigation on February 1, 2022, FFIE, certain members of the management team and employees of FFIE received a notice of preservation and subpoena from the staff of the SEC stating that the SEC had commenced a formal investigation relating to the matters that were the subject of the Special Committee investigation.

FFIE, which had previously voluntarily contacted the SEC in connection with the Special Committee investigation in October 2021, is cooperating fully with the SEC’s investigation.

Subsequent to the Company announcing the completion of the Special Committee investigation on February 1, 2022, certain members of the management team and employees of the Company received a notice of preservation and subpoena from the staff of the SEC stating that the SEC had commenced a formal investigation relating to the matters that were the subject of the Special Committee investigation.

The Company, which had previously voluntarily contacted the SEC in connection with the Special Committee investigation in October 2021, is cooperating fully with the SEC’s investigation.

The outcome of such an investigation is difficult to predict.

FF has incurred, and may continue to incur, significant expenses related to legal and other professional services in connection with the SEC investigation.

At this stage, FF is unable to assess whether any material loss or adverse effect is reasonably possible as a result of the SEC’s investigation or estimate the range of any potential loss.

In addition, in June 2022, FF received a preliminary request for information from the DOJ in connection with the matters that were the subject of the Special Committee investigation.

FF has responded to that request and intends to fully cooperate with any future requests from the DOJ.

Unconditional Contractual Obligations

An unconditional contractual obligation is defined as an agreement to purchase goods or services that is enforceable and legally binding (non-cancelable, or cancellable only in certain circumstances).

As of September 30, 2024, the Company estimates its total unconditional contractual commitments, including lease minimum payments, financial obligations on sale and lease back, notes payable, related party notes payable, related accrued interest, legal contingencies and other contractual

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

commitments, to be $ 242.4 million, which total includes $ 71.7 million for the year ending December 31, 2024, $ 28.3 million for the two years ending December 31, 2026, $ 74.5 million for the two years ending December 31, 2028 and $ 67.8 million thereafter.

The Company has incurred, and may continue to incur, significant expenses related to legal and other professional services in connection with the SEC investigation.

At this stage, the Company is unable to assess whether any material loss or adverse effect is reasonably possible as a result of the SEC’s investigation or to estimate the range of any potential loss.

In addition, in June 2022, the Company received a preliminary request for information from the DOJ in connection with the matters that were the subject of the Special Committee investigation.

The Company has responded to that request and intends to fully cooperate with any future requests from the DOJ.

Stockholders’ Equity

The number of authorized and issued and outstanding shares stock were as follows:

September 30, 2024

Shares Issued and Outstanding Shares

The number of authorized, issued and outstanding stock, were as follows:

March 31, 2025

Shares Issued Shares

Preferred Stock 10,000,000 —

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December 31, 2024

Shares Issued and Outstanding Shares

Shares Issued Shares

Preferred Stock 10,000,000 1

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114,245,313 65,925,795

Amendments to the Company’s Certificate of Incorporation and Reverse Stock Splits

At a special meeting of the Company’s stockholders held on February 28, 2023, the Company’s stockholders approved an increase to the number of the Company’s authorized shares of Class A Common Stock from 84,896 to 176,042 , increasing the Company’s total number of authorized shares of Common Stock and preferred stock from 342,709 to 433,855 .

On March 1, 2023, the Company filed an amendment to its Second Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect such increase.

At a special meeting of the Company’s stockholders held on August 16, 2023, the Company’s stockholders approved a proposal authorizing the Board to effect a reverse stock split of the outstanding Common Stock at a range between 1-for-2 and 1-for-90 shares of outstanding Common Stock, and a proposal, if and only if a reverse stock split is implemented at a ratio of 1-for-8 or greater, to amend the Company’s Second Amended and Restated Certificate of Incorporation, as amended, if necessary to reduce the number of authorized shares of the Company’s common stock to a number equal to 308,875,000 divided by the reverse stock split ratio determined by the Board.

On August 22, 2023, the Board approved the August 2023 Reverse Stock Split ratio (1-for-80).

Accordingly, on August 24, 2023, the Company filed the Third Amended and Restated Certificate of Incorporation of the Company to effect the August 2023 Reverse Stock Split and to set the number of authorized shares of Common Stock to 1,286,980 .

As a result, effective after market close on August 25, 2023, every 80 shares of the issued and outstanding Common Stock were converted into one share of Common Stock, without any change in par value per share, and the authorized shares of Common Stock were reduced to 1,286,980 , composed of (i) 1,232,292 shares of Class A Common Stock and (ii) 54,688 shares of Class B Common Stock.

No fractional shares of Common Stock were issued as a result of the August 2023 Reverse Stock Split.

Stockholders who would otherwise have received a fractional share were instead issued a full share in lieu of such fractional share.

At a special meeting of the Company’s stockholders held on February 5, 2024, the Company’s stockholders approved an increase in the authorized shares of Common Stock from 3,860,938 to 34,748,438 , increasing the total number of authorized shares of the Common Stock and preferred stock from 4,110,938 to 34,998,438 .

On February 5, 2024, the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the office of the Secretary of State of the State of Delaware to effect such increase.

Amendments to the Company’s Certificate of Incorporation

On the Closing Date of the Business Combination, the Company’s shareholders adopted the Company’s Second Amended and Restated Certificate of Incorporation.

The amendment set forth the rights, privileges, and preferences of the Common Stock.

The amendment authorizes the issuance of 10,000,000 shares of Preferred Stock with such designations, rights and preferences as may be determined from time to time by the Board.

The Board is empowered, without stockholder approval, to issue the Preferred Stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of Common Stock;

provided that any issuance of preferred stock with more than one vote per share will require the prior approval of the holders of a majority of the outstanding shares of Class B Common Stock.

Increase in Authorized Shares and Reverse Stock Split (February 2024)

On February 5, 2024, the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the office of the Secretary of the State of Delaware to effect an increase in the authorized shares of Common Stock from 3,860,938 to 34,748,438 .

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Also at the special meeting of the Company’s stockholders held on February 5, 2024, the Company’s stockholders approved an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split (referred to as the February 2024 Reverse Stock Split) of the Common Stock by a ratio of 1-for-3, with such action to be effected at such time and date, if at all, as determined by the Board within one year after the conclusion of the special meeting and a corresponding reduction in the total number of shares of Common Stock the Company is authorized to issue.

On February 23, 2024, the Board approved the implementation of the February 2024 Reverse Stock Split and the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the February 2024 Reverse Stock Split and to set the number of authorized shares of Common Stock to 11,582,813 (which is 34,748,438 divided by 3).

Pursuant to the Certificate of Amendment, effective after market close on February 29, 2024, every three shares of the issued and outstanding Common Stock were automatically converted into one share of Common Stock, without any change in par value per share and the number of authorized shares of Common Stock was reduced to 11,582,813 .

No fractional shares of Common Stock were issued as a result of the February 2024 Reverse Stock Split.

At a special meeting of the Company’s stockholders held on February 5, 2024, the Company’s stockholders approved an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of the Common Stock by a ratio of 1-for-3 (the “Second Reverse Stock Split”), with such action to be effected at such time and date, if at all, as determined by the Board within one year after the conclusion of the Special Meeting and a corresponding reduction in the total number of shares of Common Stock the Company is authorized to issue.

On February 23, 2024, the Company filed a second amendment to the Company’s Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect this reverse stock split and to set the number of authorized shares of Common Stock to 11,582,813 (which is 34,748,438 divided by 3).

Pursuant to the Certificate of Amendment, effective on February 29, 2024, every three shares of the issued and outstanding Common Stock was automatically converted into one share of Common Stock, without any change in par value per share and the number of authorized shares of Common Stock was reduced to 11,582,813 .

No fractional shares of Common Stock were issued as a result of the Second Reverse Stock Split.

Stockholders who would otherwise have received a fractional share were instead issued a full share in lieu of such fractional share.

Increase in Authorized Shares, Reverse Stock Split, Adjustments to Share Reserves (July/August 2024)

At the annual meeting of the Company’s stockholders held on July 31, 2024, the Company’s stockholders approved an increase in the authorized shares of Common Stock from 11,582,813 to 104,245,313 , increasing the total number of authorized shares of the Common Stock and preferred stock from 12,582,813 to 114,245,313 .

On August 1, 2024, the Company filed an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, with the office of the Secretary of State of the State of Delaware to effect such increase.

Also at the annual meeting of the Company’s stockholders held on July 31, 2024, the Company’s stockholders approved an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, to effect the August 2024 Reverse Stock Split of the outstanding Common Stock by a ratio of between 1-for-2 and 1-for-40, with such ratio to be determined in the discretion of the Board and with such action to be effected at such time and date, if at all, as determined by the Board within one year after the conclusion of the annual meeting, and a corresponding reduction in the total number of shares of Common Stock the Company is authorized to issue.

The Board subsequently approved the implementation of the August 2024 Reverse Stock Split at a ratio of 1-for-40, and the Company filed an amendment (the “Fourth Certificate of Amendment”) to the Company’s Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the August 2024 Reverse Stock Split and to set the number of authorized shares of Common Stock to 104,245,313 .

Also at the annual meeting of the Company’s stockholders held on July 31, 2024, the Company’s stockholders approved an amendment to the Company’s Third Amended and Restated Certificate of Incorporation, as amended, to effect the reverse stock split of the outstanding Common Stock by a ratio of between 1-for-2 and 1-for-40, with such ratio to be determined in the discretion of the Board and with such action to be effected at such time and date, if at all, as determined by the Board within one year after the conclusion of the annual meeting, and a corresponding reduction in the total number of shares of Common Stock the Company is authorized to issue.

The Board subsequently approved the implementation of the 1-for-40 stock split ratio (the “Third Reverse Stock Split”), and the Company filed an amendment (the “Fourth Certificate of Amendment”) to the Company’s Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the Third Reverse Stock Split and to set the number of authorized shares of Common Stock to 104,245,313 .

Pursuant to the Fourth Certificate of Amendment, effective after market close on August 16, 2024 (the “Effective Time”), every 40 shares of the issued and outstanding Common Stock were automatically converted into one share of Common Stock, without any change in par value per share, and the number of authorized shares of Common Stock were reduced to 104,245,313 .

No fractional shares of Common Stock were issued as a result of the August 2024 Reverse Stock Split.

Stockholders who would otherwise have received a fractional share were instead issued a full share in lieu of such fractional share.

The Class A Common Stock began trading on The Nasdaq Capital Market on a split-adjusted basis for the August 2024 Reverse Stock Split at the opening of trading on August 19, 2024, under the symbol “FFIE” with a new CUSIP number (307359 885).

The Class B Common Stock also has a new CUSIP number (307359 877).

The Company’s Public Warrants continue to be traded on the Nasdaq Capital Market under the symbol “FFIEW” and the CUSIP number for the warrants remains unchanged.

However, under the terms of the applicable warrant agreement, the number of shares of Class A Common Stock issuable on exercise of each warrant is proportionately decreased and the exercise price adjusted.

Accordingly, for the Company’s warrants trading under the symbol “FFIEW”, every 40 warrants will be exercisable for one share of Class A Common Stock at an exercise price of $ 110,400.00 per share of Class A Common Stock.

The Class B Common Stock also received a new CUSIP number (307359 877).

The Company’s Public Warrants continued to trade on The Nasdaq Capital Market under the symbol “FFIEW,” with the CUSIP number unchanged.

However, under the terms of the applicable warrant agreement, the number of shares of Class A Common Stock issuable upon exercise of each warrant was proportionately decreased, and the exercise price adjusted.

Accordingly, for the Company’s warrants trading under the symbol “FFIEW,” every 40 warrants became exercisable for one share of Class A Common Stock at an exercise price of $ 110,400.00 per share of Class A Common Stock.

At the Effective Time, the number of shares of Common Stock reserved for issuance under the 2021 SI Plan (as defined below), the Company’s Smart King Ltd.

3 unchanged sentences

Proportionate adjustments were made to the number of shares of Common Stock issuable upon exercise or conversion of the Company’s outstanding warrants and convertible securities, as well as the applicable exercise or conversion prices.

Change in Trading Symbols (March 2025)

Effective March 10, 2025, the Class A Common Stock and Public Warrants currently trade under the new ticker symbols “FFAI” and “FFAIW,” respectively, on The Nasdaq Capital Market.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Increase in Authorized Shares (March 2025)

At the special meeting of the Company’s stockholders held on March 7, 2025, the Company’s stockholders approved an increase in the authorized shares of Common Stock from 104,245,313 to 129,245,313 , increasing the total number of authorized shares of the Common Stock and preferred stock from 114,245,313 to 139,245,313 .

On March 10, 2025, the Company filed a Fifth Certificate of Amendment (the “Fifth Certificate of Amendment”) to the Company’s Third Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect such increase.

Series A Preferred Stock

On June 21, 2024, in connection with a purchase agreement entered into with Mr.

Aydt, the Company’s Global CEO, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series A Preferred Stock (the “Series A Certificate of Designation”) with the Secretary of State of the State of Delaware.

The Series A Certificate of Designation designated one share of the Company’s Preferred Stock as Series A preferred stock, par value $ 0.0001 per share (the “Series A Preferred”) and established the preferences, rights and limitations thereof.

The closing of the sale and purchase of the share of Series A Preferred was completed on June 21, 2024 for a purchase price of $ 100.00 .

The share of Series A Preferred was not convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Company.

The share of Series A Preferred was not entitled to receive dividends.

The holder of the Series A Preferred was entitled to 16,000,000,000 votes for each share held of record, but had the right to vote only on any share authorization proposal or any reverse stock split proposal (together, the “Shareholder Proposals”) and until such time as the Shareholder Proposals were approved by the stockholders, and had no voting rights except (i) with respect to the Shareholder Proposals, in which its votes were cast for and against such Shareholder Proposal in the same proportion as shares of Common Stock were voted for and against such reverse stock split proposal (with any shares of Common Stock that were not voted, whether due to abstentions, broker non-votes or otherwise not counted as votes for or against the Shareholder Proposal) and (ii) unless the holders of one-third (1/3 rd ) of the outstanding shares of Common Stock were present, in person or by proxy, at the meeting of stockholders at which the Shareholder Proposals were submitted for stockholder approval (or any adjournment thereof).

The share of Series A Preferred voted together with the Common Stock as a single class on any Shareholder Proposal.

The Series A Preferred had no other voting rights, except as may be required by the General Corporation Law of the State of Delaware.

Upon a liquidation, bankruptcy, reorganization, merger, acquisition, sale, dissolution or winding up of the Company, whether voluntarily or involuntarily, pursuant to which assets of the Company or consideration received by the Company are to be distributed to the stockholders, the holder of the Series A Preferred was entitled to receive, before any payment is made to the holders of Common Stock by reason of their ownership thereof, an amount equal to $ 100.00 .

The Series A Preferred could not be transferred at any time prior to stockholder approval of the Shareholder Proposals without the prior written consent of the Board.

The outstanding share of Series A Preferred was to be redeemed in whole, but not in part, for a redemption price of $ 100.00 , payable out of funds lawfully available therefor, upon the earlier of (i) any time such redemption is ordered by the Board in its sole discretion, automatically and effective on such time and date specified by the Board in its sole discretion, or (ii) automatically immediately following the approval by the Company’s stockholders of both Shareholder Proposals.

The Series A Preferred Stock was redeemed on July 31, 2024, following the annual meeting of stockholders.

The number of outstanding warrants to purchase the Company’s Class A Common Stock as of September 30, 2024 are as follows:

On January 28, 2025, in connection with a purchase agreement entered into with Mr.

Aydt, the Company’s Global Co-CEO, the Company filed a Series A Certificate of Designation with the Secretary of State of the State of Delaware.

The Series A Certificate of Designation designated one share of the Company’s Preferred Stock as Series A preferred stock, par value $ 0.0001 per share and established the preferences, rights and limitations thereof.

The closing of the sale and purchase of the shares of the Series A Preferred was completed on January 28, 2025 for a purchase price of $ 100.00 .

The Series A Preferred Stock was redeemed on March 7, 2025, for a redemption price of $ 100.00 , following the special meeting of stockholders.

The holders of Class A Common Stock and Class B Common Stock are entitled to one vote for each share held of record on all matters to be voted on by stockholders until the occurrence of a Qualifying Equity Market Capitalization, following which holders of Class B Common Stock shall be entitled to ten votes per share and shall continue to be entitled to ten votes per share regardless of whether the Qualifying Equity Market Capitalization shall continue to exist or not thereafter.

Shares of Class B Common Stock have the right to convert into shares of Class A Common Stock at any time at the rate of one share of Class A Common Stock for each share of Class B Common Stock.

Class A Common Stock does not have the right to convert into Class B Common Stock.

In the event of any voluntary or involuntary liquidation, dissolution, or winding-up of the Corporation, after payment or provision for payment of the debts and other liabilities of the Corporation, the holders of the shares of the Common Stock shall be entitled to receive all the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion to the number of shares of the Common Stock held by them.

The number of outstanding warrants to purchase the Company’s Class A Common Stock as of March 31, 2025 were as follows:

Number of Warrants Exercise Price Expiration Date

Ares warrants 1,278,802 $ 5.24 August 5, 2027

SPA Warrants 15,143 $ 5.24 Various through August 9, 2031

Ares Warrants

5,776,657 $ 1.16 August 5, 2027

15,238 $ 1.16 Various through November 1, 2031

Junior SPA Warrants 5,931,638 $ 1.16 Various through September 30, 2029

2024 Unsecured SPA Warrants 25,874,953 $ 1.39 Various through January 21, 2030

2025 March Unsecured SPA Warrants

3,438,357 $ 1.55 April 4, 2030

Public Warrants 2,453 $ 110,400.00 July 21, 2026

Private Warrants 12 $ 110,400.00 July 21, 2026

Total 7,228,048

There were no warrants exercised during the nine months ended September 30, 2024.

The above Ares warrants and SPA Warrants contain full ratchet anti-dilution price protection that requires the exercise price to be adjusted if the Company sells shares of Common Stock below the current exercise price.

On September 5, 2024, the Company issued the Junior Secured SPA Notes with a conversion price of $ 5.24 , which represents a dilutive issuance that triggers the full ratchet anti-dilution price protection.

Therefore, the exercise price of the Ares warrants and SPA Warrants was

The number of outstanding warrants to purchase the Company’s Class A Common Stock as of December 31, 2024 were as follows:

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

adjusted from $ 29.33 to $ 5.24 .

The Company accounted for the reduction in exercise price as a deemed dividend (the “Deemed Dividend”).

The value of the Deemed Dividend, $ 4.2 million, was calculated as the change in fair value of the Ares warrant and SPA Warrants immediately before and immediately after triggering event.

The Company recognized the payment of the Deemed Dividend in Additional paid-in capital in the Company’s Condensed Consolidated Balance Sheets due to the Company’s accumulated deficit.

The number of outstanding warrants to purchase the Company’s Class A Common Stock as of December 31, 2023 were as follows:

Number of Warrants Exercise Price Expiration Date

1 unchanged sentence

SPA Warrants 15,238 $ 1.16 Various through November 1, 2031

Junior SPA Warrants 5,931,638 $ 1.16 Various through September 30, 2029

2024 Unsecured SPA Warrants 10,788,746 $ 1.39 December 31, 2029

Public Warrants 2,453 $ 110,400.00 July 21, 2026

Private Warrants 12 $ 110,400.00 July 21, 2026

Total 244,853

There were no warrants exercised for the three months ended March 31, 2025 or during the three months ended March 31, 2024.

The above Ares warrants and SPA Portfolio Note warrants contain full ratchet anti-dilution price protection that requires the exercise price to be adjusted if the Company sells shares of Common Stock below the current exercise price.

There were not any dilutive events during the three months ended March 31, 2025 and 2024.

Insufficient Authorized Shares

From time to time, certain of the Company’s equity-linked financial instruments may be classified as derivative liabilities under ASC 815, Derivatives and Hedging , due to the Company having insufficient authorized shares to fully settle the equity-linked financial instruments in shares.

In such case, the Company applies a sequencing policy under ASC 815-40, Derivatives and Hedging - Contracts in Entity’s Own Equity , whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary due to the Company’s inability to demonstrate it has sufficient authorized shares to settle the equity-linked financial instrument in shares, the Company will reclassify contracts that have overlapping settlement dates with the latest inception date as derivative instruments.

In such case, the Company applies a sequencing policy under ASC 815-40, Contracts in Entity’s Own Equity , whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary due to the Company’s inability to demonstrate it has sufficient authorized shares to settle the equity-linked financial instrument in shares, the Company will reclassify contracts that have overlapping settlement dates with the latest inception date as derivative instruments.

The contracts reclassified as derivative instruments are recognized at fair value with changes in fair value recognized in earnings until such time as the conditions giving rise to such derivative liability classification were settled or the Company has sufficient authorized, unissued shares to settle such contracts with shares.

The Company has elected to apply the same sequencing policy for share-based compensation arrangements if the Company granted share-based payment arrangements where the Company may have insufficient shares to settle the contract.

On February 28, 2023, upon stockholder approval to increase the Company’s authorized shares, the Company had sufficient authorized shares to fully settle all outstanding equity-linked financial instruments.

Again on April 21, 2023, the Company had insufficient authorized shares to fully settle its equity-linked financial instruments in shares primarily due to the issuance of additional convertible notes and warrants between February 28, 2023 and April 21, 2023.

As a result of the August 2023 Reverse Stock Split and the related increase in the number of available authorized shares of Class A Common Stock, effective August 25, 2023, the Company had sufficient authorized shares of Class A Common Stock to fully settle its equity-linked financial instruments in shares.

Accordingly, on August 25, 2023, the Company reclassified the fair value of the Earnout liability of $ 1.4 million and the fair value of the Share-based payment liability of $ 2.0 million into Additional paid-in capital.

As of September 30, 2024 and 2023, the Company has sufficient authorized shares of Class A Common Stock to fully settle its equity-linked financial instruments in shares.

Salary Deduction and Stock Purchase Agreements

On September 21, 2023, certain executive officers of the Company entered into SD SPAs with the Company.

Under the SD SPA, on each payroll date after the receipt of stockholder approval of the SD SPA (which stockholder approval was received on February 5, 2024), the officer agreed to authorize the Company to deduct 50 % of the officer’s after-tax base salary, which deducted amount would be used to purchase a number of shares of Class A Common Stock determined using the VWAP (as defined in the SD SPA) of Class A Common Stock per share on the applicable payroll date.

Pursuant to the SD SPA, the officer may decrease the amount of the deduction upon notice to the Board.

No stock purchases were made under the September 2023 SD SPAs.

In furtherance of the Board approval, Mr.

Jia entered into new SD SPAs to authorize the Company to deduct a portion of the officers’ after-tax base salary (equal to approximately 64 % of his initial pro-rated $ 550,000 base salary for Mr.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Aydt and approximately 56 % of his initial pro-rated $ 612,000 base salary for Mr.

Jia, in each case after-tax).

The September 2024 SDA SPAs will terminate on the three-month anniversary of the Effective Date.

During the three months ended September 30, 2024, Mr.

Jia purchased shares of the Company’s Class A common stock in an aggregate amount of 10,455 shares for a weighted average purchase price of $ 3.42 per share.

Stock-Based Compensation

2021 Stock Incentive Plan (“2021 SI Plan”)

In July 2021, the Company adopted the 2021 SI Plan.

The 2021 SI Plan allows the Board to grant incentive and nonqualified stock options, restricted shares, unrestricted shares, restricted share units, and other stock-based awards for Class A Common Stock to employees, directors, and non-employees.

At the special meeting held on August 16, 2023, the Company’s stockholders approved (among other proposals) an amendment to the 2021 SI Plan to increase the number of shares of Class A Common Stock available for issuance under the 2021 SI Plan by an additional 21,541 shares.

As a result of the February 2024 Reverse Stock Split on February 29, 2024, the number of shares of Class A Common Stock reserved for issuance under the 2021 SI Plan, the Company’s Equity Incentive Plan, and the Company’s Special Talent Incentive Plan (the “Plans”), as well as the number of shares subject to the then-outstanding awards under each of the Plans, were proportionately adjusted, using the 1-for-3 ratio, rounded down to the nearest whole share.

In addition, the exercise price of the then-outstanding stock options under each of the Plans was proportionately adjusted, using the 1-for-3 ratio, rounded up to the nearest whole cent.

At the annual meeting of stockholders held on July 31, 2024, the Company’s stockholders approved (among other proposals) an amendment to the 2021 SI Plan to increase the number of shares of Class A Common Stock available for issuance under the 2021 SI Plan by an additional 2,206,324 shares, subject to proportionate adjustment for stock splits and similar events as provided in the 2021 SI Plan.

As a result of the August 2024 Reverse Stock Split on August 16, 2024, the number of shares of Class A Common Stock reserved for issuance under the 2021 SI Plan, as well as the number of shares subject to the then-outstanding awards under each of the Plans, were proportionately adjusted, using the 1-for-40 ratio, rounded down to the nearest whole share.

In addition, the exercise price of the then-outstanding stock options under each of the Plans was proportionately adjusted, using the 1-for-40 ratio, rounded up to the nearest whole cent.

SOP/SOD Incentive Plan

On February 23, 2023, the Board approved the Company’s SOP/SOD Incentive Plan (“Incentive Plan”) granting:

(i) cash bonuses to all active employees of the Company that began employment at the Company prior to December 31, 2022 upon the commencement of the start of production of the Company’s FF 91 Futurist on or prior to March 31, 2023 and (ii) cash bonuses and equity incentive awards to all active employees of the Company that began employment at the Company prior to December 31, 2022 upon the commencement of the start of delivery of the Company’s FF 91 Futurist on or prior to April 30, 2023 (“Delivery Condition”).

On August 17, 2023, the Board approved an amendment to the Incentive Plan (“Incentive Plan Amendment”) to reflect the updated timing of the previously announced FF 91 2.0 Futurist Alliance phase two of its Delivery Plan from the end of April 2023 to the end of the second quarter 2023 and subsequently to August 2023.

The Incentive Plan Amendment is available to all active employees of the Company that began employment at the Company prior to July 1, 2023 and reduced the cash bonuses and milestone based restricted stock units (“RSUs”) by 10 % for the internal Company sign-off on requirements to commence phase two of the Company’s Delivery Plan on or prior to July 31, 2023 (“New Delivery Condition”).

The New Delivery Condition was met on August 12, 2023 upon delivery of the Ultimate AI Techluxury FF 91 2.0 Futurist Alliance.

Pursuant to the Incentive Plan Amendment, RSU awards would be granted after the Company had sufficient additional shares available for such issuance (“Share Issuance Condition”) and cash bonuses would be paid once the Company received an additional $ 15.0 million in financings.

The Share Issuance Condition was met on July 31, 2024, when the Company’s stockholders approved an increase in the number of shares available for issuance under the 2021 SI Plan.

The Incentive Plan Amendment includes the grant of RSUs to certain executive officers of the Company upon the Company’s satisfaction of the New Delivery Condition and the Share Issuance Condition with a grant date fair market value of approximately $ 8.0 million, subject to vesting in three annual installments on the first three anniversaries of the grant date,

In July 2021, the Company adopted the 2021 Stock Incentive Plan (“2021 Plan”).

The 2021 Plan allows the Board to grant up to 5,164 incentive and nonqualified stock options, restricted shares, unrestricted shares, restricted share units, and other stock-based awards for the Class A Common Stock to employees, directors, and non-employees.

The number of shares of Class A Common Stock available under the 2021 Plan will increase annually on the first day of each calendar year, beginning with the calendar year ending December 31, 2024, and continuing until (and including) the calendar year ending December 31, 2031.

Annual increases are equal to the lesser of (i) 5 percent of the number of shares of Class A Common Stock issued and outstanding on December 31 of the immediately preceding fiscal year and (ii) an amount determined by the Board.

As of the effective date of the 2021 Plan, no further stock awards have been or will be granted under the EI Plan or STI Plan (defined below).

At the annual meeting of stockholders held on July 31, 2024, the Company’s stockholders approved (among other proposals) an amendment to the 2021 Plan to increase the number of shares of Class A Common Stock available for issuance under the 2021 Plan by an additional 2,206,324 shares, subject to proportionate adjustment for stock splits and similar events as provided in the 2021 Plan.

As of March 31, 2025 and 2024 the Company had 535,027 and 2,469,957 shares of Class A Common Stock available for future issuance under the 2021 SI Plan.

Option Awards

As of March 31, 2025, the total unrecognized stock-based compensation expense for stock options granted under the 2021 Plan was less than $ 0.1 million, which is expected to be recognized over a weighted average period of 2.62 years.

There were no options granted under the 2021 Plan during the three months ended March 31, 2025.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

generally subject to the applicable executive’s continuous employment through each applicable vesting date.

In addition, subject to the Share Issuance Condition, upon the satisfaction of the New Delivery Condition and continuing for an eight-year period, certain executive officers will annually receive a grant of fully-vested RSUs with a grant date fair market value of $ 0.8 million, subject to their continued employment through each grant date of the award.

As of September 30, 2024, the Company accrued $ 0.2 million for cash bonuses to be paid out under the Incentive Plan, which is included in the Condensed Consolidated Balance Sheets.

During the nine months ended September 30, 2024, under the 2021 SI Plan, the Company granted 1,543,977 RSUs, which had a weighted-average grant date fair value of $ 4.10 per share.

As of September 30, 2024, the total remaining stock-based compensation expense for unvested RSUs is $ 4.9 million, which is expected to be recognized over a weighted-average period of 0.22 years.

As of September 30, 2024 and December 31, 2023, the Company had 747,032 and 26,680 shares of Class A Common Stock available for future issuance under its 2021 SI Plan.

The following table presents stock-based compensation expense included in each respective expense category in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss:

Three Months Ended

September 30, Nine Months Ended

September 30,

Restricted Stock Units

As of March 31, 2025, the total unrecognized stock-based compensation expense for RSUs granted under the 2021 Plan was $ 0.5 million which is expected to be recognized over a weighted average period of 1.51 years.

On February 1, 2018, the Board adopted the Equity Incentive Plan (“EI Plan”), under which the Board authorized the grant of up to 4,416 incentive and nonqualified stock options, restricted stock, unrestricted stock, restricted stock units, and other stock-based awards for Legacy FF’s Class A Ordinary Stock to employees, directors and non-employees.

On the closing date and in connection with the Business Combination, each of the Legacy FF’s outstanding options under the EI Plan immediately prior to the closing of the Business Combination remained outstanding and converted into the right to purchase the Company’s Class A Common Stock based on the Exchange Ratio.

As of March 31, 2025, the total unrecognized stock-based compensation expense for stock options granted under the EI Plan was less than $ 0.1 million which is expected to be recognized over a weighted average period of 1.61 years.

On May 2, 2019, the Company adopted its Special Talent Incentive Plan (“STI Plan”) under which the Board may grant up to 1,472 incentive and nonqualified stock options, restricted shares, unrestricted shares, restricted share units, and other stock-based awards for Legacy FF’s Class A Ordinary Stock to employees, directors, and non-employees.

The STI Plan does not specify a limit on the number of stock options that can be issued under the plan.

Per the terms of the STI Plan the Company must reserve and keep available a sufficient number of shares to satisfy the requirements of the STI Plan.

As of March 31, 2025, the total unrecognized stock-based compensation expense for stock options granted under the STI Plan was less than $ 0.1 million, which is expected to be recognized over a weighted average period of approximately 1.66 years.

Stock-based compensation expense

The following table presents stock-based compensation expense for all of the Company’s 2021 Plan, EI Plan, STI Plan and Common Units of FF Global included in each respective expense category in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss is as follows:

Three Months Ended March 31,

(in thousands) 2025 2024

3 unchanged sentences

$ 301,077 $ 542,171

Included in stock-based compensation expense for the three months ended September 30, 2023 is a $ 0.7 million gain related to when the Company’s share-based payment awards were classified as liabilities from July 1, 2023 through August 25, 2023.

Included in stock-based compensation expense for the nine months ended September 30, 2023 is a $ 4.1 million gain related to when the Company’s share-based payment awards were classified as liabilities from time to time during the nine months ended September 30, 2023.

Fair Value of Financial Instruments

Fair Value Measurements

The Company applies the provisions of ASC 820, Fair Value Measurement , which defines a single authoritative definition of fair value, sets out a framework for measuring fair value and expands on required disclosures about fair value measurements.

The provisions of ASC 820, Fair Value Measurement relate to financial assets and liabilities as well as other assets and liabilities carried at fair value on a recurring and nonrecurring basis.

The standard clarifies that fair value is an exit price representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants.

As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.

As a basis for considering such assumptions, the standard establishes a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1 Valuations for assets and liabilities traded in active exchange markets, or interest in open-end mutual funds that allow a company to sell its ownership interest back at net asset value on a daily basis.

Valuations are obtained from readily available pricing sources for market transactions involving identical assets, liabilities, or funds.

Level 2 Valuations for assets and liabilities traded in less active dealer, or broker markets, such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active.

Level 2 instruments typically include U.S.

Government and agency debt securities and corporate obligations.

Valuations are usually obtained through market data of the investment itself as well as market transactions involving comparable assets, liabilities or funds.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Level 3 Valuations for assets and liabilities that are derived from other valuation methodologies, such as option pricing models, discounted cash flow models or similar techniques, and not based on market exchange, dealer, or broker-traded transactions.

Level 3 valuations incorporate certain assumptions and projections in determining the fair value assigned to such assets or liabilities.

Fair value estimates are made at a specific point in time based on relevant market information and information about the financial or nonfinancial asset or liability.

Notes Payable

The Company has elected to measure certain notes payable and related party notes payable at fair value, specifically, the SPA Notes as they contain embedded liquidation premiums with conversion rights that represent embedded derivatives, the Unsecured Convertible Notes as they can be exchanged into an SPA Note, and the Junior Secured SPA Notes as they contain embedded conversion and redemption rights that represent embedded derivatives (see Note 7, Notes Payable and Note 8, Related Party Transactions ).

The Company used a binomial lattice model and discounted cash flow methodology to value the SPA Notes.

The significant assumptions used in the models include the volatility of the Class A Common Stock, the Company’s expectations around the full ratchet trigger, the Company’s debt discount rate based on a CCC rating, annual dividend yield, and the expected life of the instrument.

Fair value measurements associated with the notes payable represent Level 3 valuations under the fair value hierarchy.

The fair value adjustments related to notes payables were recorded in Change in fair value measurements on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

SPA Warrants and Junior SPA Warrants

The Company’s SPA Warrants were originally liability classified pursuant to ASC 480-10.

While liability classified, the Company elected to measure the SPA Warrants at fair value using a Monte Carlo simulation model, where the significant assumptions used include the volatility of the Company’s Class A Common Stock, the Company’s expectations around the full ratchet trigger, the contractual term of the SPA Warrants, the risk-free rate and annual dividend yield.

Fair value measurements associated with the liability-classified warrants represent Level 3 valuations under the fair value hierarchy.

During the period ended September 30, 2024, the Company’s SPA Warrants met the requirements for equity classification.

The Company remeasured the SPA Warrants on the date that the requirements were met, (i.e., on August 1, 2024), and reclassified the balance in Additional Paid-In Capital.

On the date of reclassification, the Company’s SPA Warrants had a fair value that was considered $ 0.2 million.

The Company’s Junior SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity .

The Junior SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company in a manner that is not consistent with the holders of the Company’s Common Stock.

The Company elected to measure the Junior SPA Warrants at fair value using a Monte Carlo simulation model, where the significant assumptions used include the volatility of the Company’s Class A Common Stock, the Company’s expectations around the full ratchet trigger, the contractual term of the Junior SPA Warrants, the risk-free rate and annual dividend yield.

Fair Value of Financial Instruments

Notes Payable & Related Party Notes Payable

The Company has elected to measure certain notes payable and related party notes payable at fair value.

Specifically, the SPA Portfolio Notes or notes convertible into SPA Portfolio Notes as they contain embedded liquidation premiums with conversion rights that represent embedded derivatives (see Note 7, Notes Payable and Note 8, Related Party Transactions ).

The Company uses a binomial lattice model and discounted cash flow methodology to value the notes carried at fair value.

The significant assumptions used in the models include the volatility of the Class A Common Stock, the Company’s expectations around the full ratchet anti-dilution and other triggering events, the Company’s debt discount rate based on a CCC rating, annual dividend yield, the risk free rate, and the expected life of the instrument.

Fair value measurements associated with the notes payable and related party notes payable represent Level 3 valuations under the fair value hierarchy.

The fair value adjustments related to notes payables and related party notes payable were recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options or Change in fair value of related party notes payable, warrant liabilities, and derivative call options, respectively, in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

For notes payable and related party notes payable where the Company did not elect the fair value option pursuant to ASC 825, Financial Instruments, the carrying value approximates the fair value of the obligation.

SPA Portfolio Note Warrants

The Company is required to measure certain SPA Portfolio Note warrants at fair value.

The Company uses a Monte Carlo simulation model to measure the fair value of the liability classified SPA Warrants, where the significant assumptions used include the volatility of the Company’s Class A Common Stock, the Company’s expectations around the full ratchet anti-dilution and other triggering events, the contractual term of the warrant, the risk-free rate and annual dividend yield.

Fair value measurements associated with the liability-classified warrants represent Level 3 valuations under the fair value hierarchy.

Incremental Warrants

The Company’s Incremental Warrants represent a derivative call obligation pursuant to ASC 815, Derivatives and Hedging .

As of September 30, 2024, the Company had Incremental Warrants outstanding that could be exercised for $ 30.0 million in Junior Secured SPA Notes.

The Incremental Warrants are exercisable solely at the option of the holder for a period of one year from issuance.

The Company concluded that the fair value of the Incremental Warrant derivative obligation was de minimus at inception.

The Company will monitor the performance of the Company’s stock price and the fair value of the Junior Secured SPA Notes at each period to determine if the exercise price of the Junior Secured SPA Note par value is in-the-money.

Public and Private Warrants

Upon the closing of the Business Combination, the Company assumed 2,394 Public Warrants and 62 private warrants (the “Private Warrants”) from PSAC.

The Company also issued 9 Private Warrants to settle related party notes of PSAC.

The Public Warrants are indexed to the Company’s own stock and, as such, meet the scope exception in accordance with ASC

The fair value adjustments related to the liability classified warrants were recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options or Change in fair value of related party notes payable, warrant liabilities, and derivative call options, in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

Derivative Call Options

Holders of the Junior Secured SPA Notes, the 2024 Unsecured SPA Notes, and 2025 March Unsecured SPA Notes were issued Incremental Warrants to purchase additional notes on the same terms and conditions up to the amounts originally funded under their commitments.

The Company estimates the fair value of the Incremental Warrants using both a binomial lattice model and Monte Carlo simulation to value the Incremental Warrants as the Incremental Warrants entitle the holder to the relevant SPA Portfolio Note and SPA Portfolio Warrant upon exercise.

The significant assumptions used include the volatility of the Company’s Class A Common Stock, the Company’s expectations around the full ratchet anti-dilution and other triggering events, the contractual term of the Incremental Warrants, the risk-free rate and annual dividend yield.

The underlying convertible notes and the warrants issuable upon the exercise of the Incremental Warrant were assumed to be exercisable up to the maximum allowable amount.

Additionally, the terms of these instruments were presumed to be consistent with those of the convertible notes and warrants issued in connection with the Incremental Warrants.

Fair value measurements associated with the liability-classified derivatives represent Level 3 valuations under the fair value hierarchy.

The fair value adjustments related to the Incremental Warrants were recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options or Change in fair value of related party notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

815-40 to be classified in equity.

The Private Warrants are classified as liabilities and the fair value is included in Warrant Liabilities on the Unaudited Condensed Consolidated Balance Sheets.

The Company valued the Private Warrants using a binomial lattice model.

Inherent in a binomial lattice model are assumptions related to risk free rate, annual dividend yield, expected warrant life, and volatility of the Company's stock.

The Company concluded that the Private Warrants did not have any value as of September 30, 2024 and had an estimated the fair value of $ 0.1 million as of December 31, 2023.

Changes in the fair value of the Private Warrants are recorded in Change in Fair Value Measurements in the Company’s Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Fair value measurements associated with the Private Warrants liabilities represent Level 3 valuations under the fair value hierarchy.

Liabilities due to Insufficient Authorized Shares

See Note 11, Stockholders’ Equity .

Recurring Fair Value Measurements

Financial assets and financial liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The following tables present financial liabilities remeasured on a recurring basis by level within the fair value hierarchy:

September 30, 2024

The following tables present financial assets and liabilities remeasured on a recurring basis by level within the fair value hierarchy:

March 31, 2025

(in thousands) Level 1 Level 2 Level 3

1 unchanged sentence

$ — $ — $ 23,624

Derivative call options 1

$ — $ — 17,057

Notes payable 1

$ — $ — 21,136

_______________

1 Includes both related party and non-related party balances for the Company’s notes payable and warrant liabilities.

3 unchanged sentences

$ — $ — $ 28,864

Derivative call options 1

Notes payable 1

1 unchanged sentence

1 Includes both related party and non-related party balances for the Company’s notes payable and warrant liabilities.

There were not any transfers of assets and liabilities between Level 1, Level 2 and Level 3 of the fair value measurement hierarchy during the three and nine months ended September 30, 2024 or the twelve months ended December 31, 2023.

The carrying amounts of the Company’s financial assets and liabilities, including cash, restricted cash, deposits, accounts payable, accrued liabilities and certain notes payable approximate fair value because of their short-term nature or contractually defined value.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

There were not any transfers of assets and liabilities between Level 1, Level 2 and Level 3 of the fair value measurement hierarchy during the three months ended March 31, 2025 and the year ended December 31, 2024.

The carrying amounts of the Company’s financial assets and liabilities, including cash, restricted cash, deposits, accounts payable, accrued liabilities and notes payable, other than the SPA Portfolio Notes, approximate fair value because of their short-term nature or contractually defined value.

The following table summarizes the activity of Level 3 fair value measurements:

(in thousands) Warrant Liabilities 1

Derivative Call Option 1

Notes Payable 1

2 unchanged sentences

Additions 16,341 2

Exercises — —

Change in fair value measurements ( 21,581 ) ( 32,382 ) ( 22,445 )

Conversions of notes to Class A Common Stock — — ( 15,572 )

Debt extinguishments — 2,699

Reclassification of SPA Warrants from liability to equity ( 160 ) —

Balance as of September 30, 2024

Balance as of March 31, 2025

$ 23,624 $ 17,057 $ 21,136

_______________

1 Includes both related party and non-related party balances for the Company’s notes payable and warrant liabilities.

Net Loss per Share

2 Addition to Warrant Liabilities and Derivative Call Option are included as loss in line items Change in fair value of notes payable, warrant liabilities, and derivative call options and Change in fair value of related party notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

This information is presented to facilitate reconciliation to the related amounts reported in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

3 Additions of Notes Payable measured at fair value are presented net of the initial fair value adjustment recorded at issuance.

This adjustment, which reduced the principal amount of the Notes Payable by $ 11,349 thousand upon initial recognition, is presented as gain in the line items Change in fair value of notes payable, warrant liabilities, and derivative call options and Change in fair value of related party notes payable, warrant liabilities, and derivative call options in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

In addition, the line item Change in fair value of notes payable, warrant liabilities, and derivative call options includes a loss of $ 429 thousand, and the line item Change in fair value of related party notes payable, warrant liabilities, and derivative call options includes a loss of $ 76 thousand, both of which relate to debt issuance costs.

These costs are separately identifiable from the fair value adjustments described above and are not included in the Additions of Notes Payable This information is presented to facilitate reconciliation to the related amounts reported in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss .

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Net Loss Per Share Attributable to Common Stockholders

Basic net loss per share attributable to common stockholders is calculated by dividing net loss attributable to common stockholders by the weighted-average number of shares outstanding.

Diluted net loss per share attributable to common stockholders adjusts the basic net loss per share attributable to common stockholders and the weighted-average number of shares issued for potentially dilutive instruments.

The following data shows the amounts used in computing net loss per share and the effect on net loss and the weighted-average number of shares (in thousands, except share and per share amounts):

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Basic net loss per share attributable to common stockholders is calculated by dividing net loss attributable to common stockholders by the weighted-average number of shares issued and shares to be issued under the commitment to issue shares, as these shares are issuable for no consideration.

The following data shows the amounts used in computing net loss per share and the effect on net loss and the weighted-average number of shares as follows:

Three Months Ended March 31,

(in thousands, except share and per share amounts) 2025 2024

Net loss $ ( 10,278 ) $ ( 48,217 )

Deemed Dividend ( 4,153 ) — ( 4,153 ) —

Net loss available to common stockholders $ ( 81,839 ) $ ( 78,046 ) $ ( 238,741 ) $ ( 347,947 )

Weighted average shares used in computing net loss per share of Class A and B Common Stock:

4 unchanged sentences

Diluted $ ( 0.14 ) $ ( 26.23 )

The net loss per common share was the same for the Class A Common Stock and Class B Common Stock because they are entitled to the same liquidation and dividend rights and are therefore combined in the Company’s Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Because the Company reported a net loss for all periods presented, all potentially dilutive Common Stock equivalents were determined to be antidilutive for those periods and have been excluded from the calculation of net loss per share.

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table presents the potentially dilutive shares that were excluded from the computation of diluted net loss per share of Common Stock attributable to Common Stock stockholders because their effect was anti-dilutive:

Three Months Ended

September 30, Nine Months Ended

September 30,

2024 2023 2024 2023

Shares issuable upon conversion of SPA Notes and settlement of make-whole provisions 25,995,784 746,412 25,995,784 746,412

The net loss per common share was the same for the Class A Common Stock and Class B Common Stock because they are entitled to the same liquidation and dividend rights and are therefore combined in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.

Net Loss per Share

Potentially Dilutive Shares

The Company reported net losses for all periods presented, resulting in all potentially dilutive Common Stock equivalents being considered antidilutive and excluded from the calculation of net loss per share.

The table below presents the potentially dilutive shares that were excluded from the computation of diluted net loss per share of Common Stock attributable to Common Stock stockholders due to their antidilutive effect:

Three Months Ended March 31,

Shares issuable upon conversion of SPA Portfolio Notes 44,298,705 2,331,077

Shares issuable upon conversion of Unsecured Convertible Notes 1,809,969 390,601

Shares issuable upon exercise of SPA Warrants 15,143 13,790 15,143 13,790

Shares issuable upon exercise of Junior SPA Warrants 5,931,638 — 5,931,638 —

Shares issuable upon exercise of equity classified SPA Portfolio Note warrants 15,238 13,968

Shares issuable upon exercise of liability classified SPA Portfolio Note warrants 35,244,948 —

Other warrants 5,776,657 228,482

2 unchanged sentences

Public warrants 2,453 2,453

2,453 2,453 2,453 2,453

Private warrants 12 12

Total 35,423,301 801,852 35,423,301 801,852

87,305,630 2,990,763

Faraday Future Intelligent Electric Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Subsequent Events

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the Unaudited Condensed Consolidated Financial Statements were issued.

Other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the Unaudited Condensed Consolidated Financial Statements.

Subsequent SPA Activity

Subsequent to September 30, 2024, the Company received additional funding through additional Junior Secured SPA Notes totaling $ 9.3 million in aggregate principal amount.

In addition, $ 24.5 million of principal and $ 3.6 million of interest of SPA Notes was converted into 13,537,870 shares of Class A Common Stock.

Filing of Registration Statement on Form S-1

Subsequent to September 30, 2024, the Company filed a Registration Statement on Form S-1 with the SEC on November 1, 2024, to register shares of the Company’s Class A Common Stock that are contingently issuable under the terms of the Junior Secured SPA Notes (see Note 7, Notes Payable ).

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that t he Unaudited Condensed Consolidated Financial Statements were issued.

Subsequent SPA Portfolio Notes Activity

Subsequent to March 31, 2025, the Company received gross proceeds in connection with issuance of 2024 Unsecured SPA Notes to third parties totaling $ 6.6 million with due dates ranging from April 4, 2030 through May 2, 2030 at 10.00 % interest.

Principal and accrued interest are convertible at the option of the holder into Common Stock of the Company at a conversion price per share equal to the lower of a) stated conversion price or b) lowest VWAP of the five trading days immediately prior to the day on which lender provides conversion notice.

Additionally, $ 10.6 million of principal and $ 0.9 million of interest of the Company’s SPA Portfolio Notes were converted into 10,894,406 shares of the Company’s Class A Common Stock.

Series B Preferred Stock

On March 21, 2025, the Company entered into the 2025 March Unsecured SPA pursuant to which the Company agreed to issue, among other securities, shares of Series B Preferred Stock.

The Series B Preferred stock are a newly designated class of the Company’s authorized and unissued preferred stock, par value $ 0.0001 per share.

In connection with the initial closing under the 2025 March Unsecured SPA, on April 3, 2025, the Company filed a Certificate of Designation of Preferences, Rights and Limitations of Series B Preferred Stock with the Secretary of State of the State of Delaware (the “Series B Certificate of Designation”).

On April 9, 2025, the Company filed a Certificate of Correction to the Certificate to correct a clerical error with the Secretary of State of the State of Delaware.

The Series B Certificate of Designation designates 9,000,000 shares of the Series B Preferred Stock and establishes and designates the preferences, rights and limitations thereof.

The Series B Certificate of Designation became effective upon filing.

Sale of Collateral Securing Loan with Utica

On April 18, 2025, certain non-essential equipment securing the Company’s collateralized loan with Utica Leaseco, LLC was sold at auction for approximately $ 0.7 million in gross proceeds.

The sale was conducted with the lender’s consent and involved surplus assets.

In accordance with the loan and subordination agreements, all proceeds from the auction were retained by Utica and applied toward the Company’s obligations under the loan.

The Company did not receive any of the sale proceeds.

The equipment had been previously expensed as research and development costs in prior periods and was not included in property, plant and equipment as of March 31, 2025.

The transaction did not affect scheduled debt repayments or require reclassification of the loan balance.

The Company will evaluate any further accounting implications in future reporting periods.

Envisage Settlement

On March 28, 2025, the Company entered into a Settlement and Release Agreement (the “Envisage Settlement and Release Agreement”) with Envisage Group Developments Inc.

USA (“Envisage”) to resolve a $ 1.5 million judgment stemming from an arbitration award related to several purchase orders and invoices under an Engineering Services Agreement previously executed between the Company and Envisage.

As part of the Envisage Settlement and Release Agreement, the Company agreed to satisfy $ 425 thousand of the settlement through the issuance of Class A common stock, with the number of shares based on the $ 1.08 per share closing price on April 7, 2025—the trading day prior to the issuance.

On April 8, 2025, the Company issued 393,519 shares of its Class A common stock to Envisage.

The Company has filed a Form S-1 registration statement to register these shares for resale, which is currently under SEC review and has not yet been declared effective.

The Company also agreed to pay the remaining $ 375 thousand in cash, payable in four equal monthly installments from March through June 2025.

Both parties mutually released all claims, demands, and liabilities related to the matter.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements