What changed in this filing

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Item 1A. Risk Factors

2026-03-31 compared with 2025-03-31 · 253 added, 86 removed, 1422 unchanged (19% of the section changed)

18 unchanged sentences

• The production and delivery of the FF 91 Futurist has experienced, and may continue to experience, significant delays.

• Non-binding pre-orders and other non-binding indications of interest may not be converted into binding orders/sales.

• Non-binding reservation deposits and other non-binding indications of interest may not be converted into binding orders/sales.

• The success of our business depends on attracting and retaining a large number of consumers and maintaining strong demand for our vehicles, software and services.

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• We have taken remedial measures in response to the Special Committee findings, which may be unsuccessful.

• We are involved in an SEC investigation and may be further subject to investigations and legal proceedings related to the matters underlying the Special Committee investigation and other matters.

• We were involved in an SEC investigation and may be subject to future investigations and legal proceedings related to the matters underlying the Special Committee investigation and other matters.

• The market for the FF 91 Futurist is nascent and not established.

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• Our go-to-market and sales strategy will require substantial investment and commitment of resources and is subject to numerous risks and uncertainties.

• We are pursuing multiple business strategies and expect to expand our development capabilities, and as a result, we may encounter difficulties in managing our multiple business units and our growth, which could disrupt our operations.

• If we are unable to attract and/or retain key employees and Board members, officers and other individuals, our ability to compete could be harmed.

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• Our latest business strategy, which we refer to as the Bridge Strategy and/or Dual Brand Strategy, is subject to numerous risks and uncertainties.

Risks Related to Investing in Cryptocurrency

• The launch of central bank digital currencies (“CBDCs”) may adversely impact our business.

• If we were deemed to be an investment company under the Investment Company Act, applicable restrictions likely would make it impractical for us to continue segments of our business as currently contemplated.

• The cryptocurrency we hold is not insured and not subject to FDIC or SIPC protections.

• Jerry Wang, the Global President of FF, and Koti Meka, the Chief Financial Officer of FF, serve as the Co-Chief Executive Officer and the Chief Financial Officer of AIXC, respectively.

Such appointment may cause them to devote less time to the Company.

Risks Related to our Operations in China

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We expect to continue to generate significant operating losses for the foreseeable future.

Based on our recurring losses from operations since inception and continued cash outflows from operating activities, in our audited consolidated financial statements for the years ended December 31, 2024, and 2023 , we concluded that this circumstance raised substantial doubt about our ability to continue as a going concern within one year from the original issuance date of such financial statements.

Based on our recurring losses from operations since inception and continued cash outflows from operating activities, in our consolidated financial statements for the year ended December 31, 2025 we concluded that this circumstance raised substantial doubt about our ability to continue as a going concern within one year from the original issuance date of such financial statements.

Similarly, in their audit reports on the consolidated financial statements for the years ended December 31, 2025 and 2024 , our current and former independent registered public accounting firms included an explanatory paragraph stating that our recurring losses from operations and continued cash outflows from operating activities raised substantial doubt about our ability to continue as a going concern.

Our consolidated financial statements for the years ended December 31, 2025 and 2024 do not include any adjustments that may result from the outcome of this uncertainty.

As of the date that our consolidated financial statements for the year ended December 31, 2024 , were issued, our management determined that FF would be required to obtain additional funding to continue as a going concern, resulting in there being substantial doubt about our ability to continue as a going concern.

As of the date that our consolidated financial statements for the year ende d December 31, 2025 , were issued, our management determined that FF would be required to obtain additional funding to continue as a going concern, resulting in there being substantial doubt about our ability to continue as a going concern.

We only recognized $0.5 million in revenue in 2025 .

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• seek to execute on our AI strategy;

• continue to develop and equip our manufacturing FF ieFactory California facility in Hanford, California;

• continue to develop and equip our manufacturing FF aiFactory California facility in Hanford, California;

• build up inventories of parts and components;

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Junior Secured SPA Notes;

and 2024 Unsecured SPA Notes (collectively known as the “SPA Portfolio Notes”) (each as defined in Note 7, Notes Payable to the Notes to Consolidated Financial Statements) has obtained commitments from several inve stors totaling $614.5 million in convertible note financing, subject to certain conditions.

A total $405.3 million under these commitments were unfunded as of December 31, 2024 with the remaining unfunded commitment of $209.2 million.

2024 Unsecured SPA Notes, 2025 March Unsecured SPA Notes and 2025 July Unsecured SPA Notes (collectively known as the “SPA Portfolio Notes”) (each as defined in Note 8, Notes Payable to the Notes to Consolidated Financial Statements) has obtained commitments from several inve stors totaling $739.0 million in convertible note financing, subject to certain conditions.

A total $503.3 million under these commitments were funded as of December 31, 2025 with the remaining unfunded commitment of $49.5 million .

Investors of the convertible notes have the option to purchase an additional up to 100% of the committed notes at the same economics.

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In addition, if we have to adjust and/or reduce or suspend certain payments to suppliers, such adjustments and/or reductions could further delay production and deliveries.

If we further meaningfully delay additional production and delivery, potential consumers may lose confidence in us, and customers who have placed pre-orders may them, harming our growth prospects.

If we further meaningfully delay additional production and delivery, potential consumers may lose confidence in us, and customers who have placed reservation deposits may them, harming our growth prospects.

Additionally, our competitors may move more quickly to market, which could impact our ability to grow our market share.

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Non-employee user developers entered into consulting, branding, and other arrangements with us in exchange for fees ranging from approximately $150,000 to $475,000.

Further, although we have engaged in marketing activities, as of December 31, 2024, we had only 299 non-binding, fully refundable pre-orders for the FF 91 Futurist in the U.S.

and China, and other non-binding indications of interest.

Further, although we have engaged in marketing activities, as of December 31, 2025 , we had o nly 13,600 non-binding, fully refundable pre-orders for the FF 91 Futurist in the U.S.

and China, under 500 non-binding, fully refundable pre-orders for the FX Super One and other non-binding indications of interest.

We do not have binding purchase orders or commitments from customers for any vehicles.

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Even if we are able to obtain binding orders, customers may defer their purchases as they assess our vehicles.

Commercializing the FF 91 Futurist and potential FX models will likely be a long process and depend on our ability to fund and scale up our productions, including through securing additional funding for our operations, the consummation of various third-party agreements and expanding marketing functions, as well as the safety, reliability, efficiency and quality of our vehicles, and the support and service that will be available.

Commercializing the FF 91 Futurist and potential FX models, including FX Super One, will likely be a long process and depend on our ability to fund and scale up our productions, including through securing additional funding for our operations, the consummation of various third-party agreements and expanding marketing functions, as well as the safety, reliability, efficiency and quality of our vehicles, and the support and service that will be available.

It will also depend on factors outside our control, such as competition, general market conditions and broader trends in vehicle electrification and fleet management, which could impact customer buying decisions.

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Jia is an “officer” of our company within the meaning of Section 16 of the Exchange Act (a “Section 16 officer”) and an “executive officer” of our company under Rule 3b-7 under the Exchange Act.

On April 25, 2025, the Company disclosed the appointment of Mr.

Yueting Jia as 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.

Given the governance changes pursuant to the Heads of Agreement such as those described above and further changes to the composition of the Board, the remedial actions approved by the Board in connection with the Special Committee investigation may not be fully implemented or successful.

We are involved in an SEC investigation and may be further subject to investigations and legal proceedings related to the matters underlying the Special Committee investigation and other matters, which may result in adverse findings, damages, the imposition of fines or other penalties, increased costs and expenses and the diversion of management’s time and resources.

We were involved in an SEC investigation and may be subject to future investigations and legal proceedings related to the matters underlying the Special Committee investigation and other matters, which may result in adverse findings, damages, the imposition of fines or other penalties, increased costs and expenses and the diversion of management’s time and resources.

In connection with the Special Committee investigation, we, certain members of our management team and other employees 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 beginning in October 2021.

We had previously voluntarily contacted the SEC in connection with the Special Committee investigation and are cooperating fully with the SEC’s investigation.

The outcome is difficult to predict, and the SEC has expanded the scope of its investigation beyond that of the Special Committee.

In addition, the SEC may subject our directors, officers and employees to fines, penalties and other punitive actions.

We had previously voluntarily contacted the SEC in connection with the Special Committee investigation and cooperated fully with the SEC’s investigation.

In June 2022, we received a preliminary request for information from the U.S.

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We responded to that request and intend to fully cooperate with any future requests from the DOJ.

At this stage, we are 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.

On October 20, 2022, we received a subpoena from the SEC requiring us to produce certain documents relating to our transactions with Senyun.

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On each of January 30, 2024, and April 8, 2024, we received a subpoena from the SEC requiring us to produce certain additional documents relating to the SEC’s investigation.

We have fully complied with and intend to continue to fully comply with the subpoenas.

We have incurred, and may continue to incur, significant legal, accounting and other professional services expenditures in connection with the Special Committee investigation, SEC investigation, SEC inquiries, stockholder lawsuits and the DOJ inquiry.

We fully complied with the subpoenas.

We have incurred, and may continue to incur, significant legal, accounting and other professional services expenditures in connection any future SEC investigation, SEC inquiries, stockholder lawsuits and/or the DOJ inquiry.

Any legal proceedings resulting from these investigations, including further shareholder derivative litigation or governmental inquiries or investigations may further divert management’s time and attention and may result in the incurrence of significant expense, including legal fees.

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The FF 91 model incorporates approximately 2,200 purchased components sourced from approximately 200 suppliers, many of whom are currently our single-source suppliers for the components they supply.

Moreover, we rely on a single supplier for the majority of the components and engineering services required for our FX Super One.

The supply chain exposes us to multiple potential sources of delivery failure or component shortages.

We have delayed payments to suppliers, which in some cases has resulted in, and may continue to result in, certain suppliers ceasing to do business with us.

If our suppliers experience any delays or stoppages in providing or developing necessary components or experience quality issues, or if they otherwise decide to cease doing business with us, we could experience further delays, some of which may be significant, in delivering on our planned timelines.

We have not approved secondary sources for the key single-sourced components used in the FF 91 series.

If our suppliers experience any delays or stoppages in providing or developing necessary components or experience quality issues, or if they otherwise decide to cease doing business with us, we could experience further delays, including in homologating the FX Super One for the U.S.

Market, some of which may be significant, in delivering on our planned timelines.

We have not approved secondary sources for the key single-sourced components used in the FF 91 series and FX Super One.

Generally, we do not maintain long-term agreements with these single-source suppliers.

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Some suppliers have requested accelerated payments and other terms and conditions as a result of our past payment history and concerns about our financial condition, leading to less favorable payment terms than anticipated, and delaying or putting at risk certain deliveries.

Disruption in the supply of components, whether or not from a single-source supplier, could impar production until a satisfactory alternative supplier is found, which can be time consuming and costly.

Disruption in the supply of components, whether or not from a single-source supplier, could impair production until a satisfactory alternative supplier is found, which can be time consuming and costly.

We may be unable to successfully retain alternative suppliers or supplies in a timely manner or on acceptable terms, if at all.

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New laws, guidance, and/or decisions in this area could provide a new regulatory framework that will evidence a necessity to adjust or that may limit our ability to use our existing machine learning and artificial intelligence models and require us to make changes to our operations that may decrease our operational efficiency, result in an increase to operating costs and/or hinder our ability to improve our services.

Manufacturing the FF 91 at our leased FF ieFactory in California does not guarantee we will not incur significant production delays.

We plan to continue to build-out our leased FF ieFactory in California to support the production of the FF 91 series.

Manufacturing the FF 91 at our leased FF aiFactory in California does not guarantee we will not incur significant production delays.

We plan to continue to build-out our leased FF aiFactory in California to support the production of the FF 91 series.

We may experience unexpected delays or other difficulties that could further increase costs and/or adversely affect our manufacturing and delivery timelines.

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Relatedly, trade policies could lead to an increasing number of competitors entering the United States, thereby creating more competition.

Escalated geographical tensions in key markets may result in declines in consumer confidence and spending, could have a material adverse effect on the Company’s operating results and development.

Events such as international hostilities (including the Russian invasion of Ukraine and war in the Middle East), terrorism, natural disasters or outbreaks of disease may suppress consumer spending and delay our development and deployment of our business in Middle East.

Recent escalations in hostilities involving Iran, as well as the risk of a broader regional conflict in the Middle East, have increased geopolitical uncertainty and volatility in the region.

The Middle East represents a significant market for the Company, and further deterioration in regional stability could adversely affect consumer confidence, and overall demand for our products in that market.

In addition, expanded military activity, sanctions, trade restrictions, shipping disruptions, port closures, airspace restrictions, or damage to critical infrastructure could disrupt the Company’s distribution channels, supply chain operations, logistics providers, and retail partners in the region.

Escalation of the conflict could also result in higher energy prices, currency volatility, inflationary pressures, or broader global economic instability, any of which could negatively impact consumer spending and the Company’s operating costs.

To the extent that hostilities persist or expand, the Company could experience adverse effects on our business, financial condition, and results of operations.

Continued or increased price competition in the automotive industry generally, and in electric and other alternative fuel vehicles, may harm our business.

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In some cases, such competitors have announced an intention to produce electric vehicles exclusively at some point in the future.

We currently directly compete with other pure-play electric vehicle companies targeting the high-end market segment and to a lesser extent with NEVs and internal combustion engine vehicles in the mid- to high-end market segment offered by traditional OEMs.

We currently directly compete with other pure-play electric

vehicle companies targeting the high-end market segment and to a lesser extent with NEVs and internal combustion engine vehicles in the mid- to high-end market segment offered by traditional OEMs.

The FX brand would compete with companies targeting the lower end of the market.

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All these would have a material and adverse effect on our business, prospects, results of operations and financial condition.

We are pursuing multiple business strategies and expect to expand our development capabilities, and as a result, we may encounter difficulties in managing our multiple business units and our growth, which could disrupt our operations.

Although our main business strategy has been focused on the design, engineering and manufacturing of next-generation intelligent, connected, electric vehicles, we are currently pursuing multiple business strategies simultaneously, including activities in cryptocurrency, artificial intelligence and robotics.

We believe pursuing these multiple business strategies could offer financial and operational synergies, but these diversified operations also place increased demands on our resources and also introduce complexities in management and operations.

Effective management of multiple business units requires judicious allocation of resources.

As we continue to expand our capabilities, operational complexity will increase.

Managing this complexity without significant disruptions to existing operations may pose a substantial challenge.

Moreover, balancing the priorities of different business strategies may lead to conflicts in strategic focus, potentially diluting the effectiveness of our business efforts and leading to suboptimal outcomes.

Our leadership team's ability to oversee multiple business units and expansion initiatives is finite and excessive demands on management could lead to oversight gaps and strategic missteps.

To manage our multiple business strategies and our ongoing and anticipated future growth, we must continue to implement and improve our managerial, operational and financial systems, expand our facilities, and continue to recruit and train additional qualified personnel.

Our management team may not be able to effectively manage our multiple business strategies and the expansion of our operations or recruit and train additional qualified personnel.

The expansion of our operations has led to and may continue to lead to significant costs and may divert our management and business development resources.

Our management, personnel, and systems may not be adequate to support our future expansion.

Any inability to manage our multiple business units and growth could delay the execution of our business strategies or disrupt our operations and the synergies we believe currently exist between our business units.

The integration of new business units or expansion of development capabilities may not proceed smoothly, potentially leading to inefficiencies, duplication of efforts, or cultural misalignment.

Rapid growth can also strain our systems, processes, and staff, and if not managed properly, can lead to

operational inefficiencies or increased costs.

Our failure to manage these complexities could lead to operational disruptions and negatively impact our business, prospects, results of operations and financial condition.

Difficult economic conditions, financial or economic crises, or the perceived threat of such a crisis, including a significant decrease in consumer confidence, may affect consumer purchases of premium items, such as our FF 91 Futurist.

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These types of events could lead to operational difficulties, impair our ability to manage our business and expose our business activities to significant losses.

Our management and operational teams are based in the United States, China and the UAE.

Our management and operational teams are based in the United States, China and the U.A.E.

Our manufacturing facility is located in Hanford, California, and we may seek to establish manufacturing through a joint venture in China and/or other regions for certain future vehicle models.

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Our success depends in part on our ability to retain key members of our senior management team and the Board, and to attract and retain other highly qualified individuals for the Board and senior management positions.

We have experienced significant changes in the membership of the Board and senior management team, including the resignations of Ke Sun, Adam He and Li Han from their positions as members of the Board and various committees, as well as the resignation of FF China’s CEO, our Interim Chief Financial Officer, our Chief Accounting Officer, our Head of Human Resources, and our Interim Global General Counsel.

We have experienced significant changes in the membership of the Board and senior management team.

This significant recent turnover has disrupted, and potential future turnover could further disrupt, our operations, strategic focus or ability to drive stockholder value.

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Moreover, with our ownership of patents limited mostly to those issued in China and the United States, we may find it impossible to prevent competitors from copying our patented advancements in vehicles manufactured and sold elsewhere.

Despite our efforts to protect our proprietary rights, third parties may still attempt to copy or otherwise obtain and use our intellectual property or seek court declarations that such third parties’ intellectual property does not infringe upon our intellectual property rights, or they may be able to independently develop technologies that are the same as or similar to our technologies.

intellectual property rights, or they may be able to independently develop technologies that are the same as or similar to our technologies.

We may not be able to obtain patent protection on certain of our technological developments and may face better-funded competitors with formidable patent portfolios.

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In addition, decisions by regulators permitting us to sell vehicles may be challenged by dealer associations and others as to whether such decisions comply with applicable state motor vehicle industry laws.

In some states, there have also been regulatory and legislative efforts by dealer associations to interpret laws or propose laws that, if enacted, would prevent us from obtaining dealer licenses in their states given our direct sales model.

In some states, there have also

been regulatory and legislative efforts by dealer associations to interpret laws or propose laws that, if enacted, would prevent us from obtaining dealer licenses in their states given our direct sales model.

States may also restrict our ability to service vehicles once sold or leased and delivered to customers.

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Substantial increases in the raw materials or component prices costs could reduce margins if we cannot recoup the increased costs through increased vehicle prices.

Any attempts to increase product prices in response to increased material costs could result in a decrease in sales and therefore materially and adversely affect our brand, business, prospects, financial condition and operating results.

Any attempts to

increase product prices in response to increased material costs could result in a decrease in sales and therefore materially and adversely affect our brand, business, prospects, financial condition and operating results.

W e may be subject to risks associated with autonomous driving technology.

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We may incur substantial losses if our vehicles’ fair market value deteriorates faster than projected.

Yueting Jia, our founder and Chief Product and User Ecosystem Officer, is closely associated with our image and brand, and his public image may color public and market perceptions of our company.

Yueting Jia, our founder and Global Co-Chief Executive Officer, is closely associated with our image and brand, and his public image may color public and market perceptions of our company.

Negative information about Mr.

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Jia could also adversely impact us.

Because of his position as our founder and his continuing role as our Chief Product and User Ecosystem Officer, as Founder Advisor to the Board (effective as of October 4, 2022), and, as of February 26, 2023, a Section 16 officer and an “executive officer” under Rule 3b-7 of the Exchange Act, Mr.

Because of his position as our founder and his continuing role as our Chief Product and User Ecosystem Officer, as Founder Advisor to the Board (effective as of October 4, 2022), and, as of February 26, 2023 and his appointment as Global Co-Chief Executive Officer in April 2025, a Section 16 officer and an “executive officer” under Rule 3b-7 of the Exchange Act, Mr.

Jia is closely associated with our image and brand.

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The Board also approved our user ecosystem, capital markets, human resources and administration, corporate strategy and China departments reporting to both Mr.

Jia and the Global CEO, subject to processes and controls to be determined by the Board after consultation with our management.

Our remaining departments continue to report to the Global CEO.

Jia, our Global Co-CEO as of April 25, 2025 and our other Global Co-CEO, subject to processes and controls to be determined by the Board after consultation with our management.

Our remaining departments continue to report to the Global Co-CEOs.

Based on the changes to his responsibilities, the Board determined that Mr.

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Given that Mr.

Jia was disciplined by us in connection with the Special Committee investigation, and in light of the regulatory sanctions he has faced in China (as described above under “ – Yueting Jia, our founder and Chief Product and User Ecosystem Officer, is closely associated with our image and brand, and his public image may color public and market perceptions of us.

Jia was disciplined by us in connection with the Special Committee investigation, and in light of the regulatory sanctions he has faced in China (as described above under “ – Yueting Jia, our founder and Global Co-Chief Executive Officer, is closely associated with our image and brand, and his public image may color public and market perceptions of us.

Negative information about Mr.

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For example, beginning in June 2022 we and FF Global were party to a dispute over various terms of the Shareholder Agreement (as then in effect), including relating to FF Global’s right to remove its designees from the Board.

As part of this dispute, on June 22, 2022, Matthias Aydt, our current Global CEO and director and then a member of the board of managers of FF Global, after a discussion with a member of FF Global, relayed to Mr.

As part of this dispute, on June 22, 2022, Matthias Aydt, our current Global Co-CEO and director and then a member of the board of managers of FF Global, after a discussion with a member of FF Global, relayed to Mr.

Brian Krolicki, a former member of the Board, that FF Global would pay Mr.

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In addition, the diversion of management and Board attention caused by such disputes may risk the successful completion of our ongoing financing efforts.

If we are unable to raise sufficient additional funds in the near term, we may be required to further delay our production and delivery plans for the FF 91 Futurist, reduce headcount, liquidate our assets, file for bankruptcy, reorganize, merge with another entity, and/or cease operations.

If we are unable to raise sufficient additional funds in the near term, we may be required to further delay our production and delivery plans for the FF 91 Futurist and FX Super One, reduce headcount, liquidate our assets, file for bankruptcy, reorganize, merge with another entity, and/or cease operations.

We are subject to legal proceedings, claims, and disputes arising both in and outside the ordinary course of business.

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• the strategy could require a U.S.-wide after-service and support infrastructure, which would be costly to build.

We, our founder and Global Co-Chief Executive Officer, and our Global President, have each received a Wells Notice from the SEC contemplating a civil enforcement action, which could have a material adverse effect on our business, financial condition, results of operations, prospects, reputation, and/or our stock price.

On June 26, 2025, the Company received a “Wells Notice” from the staff of the SEC stating that the SEC staff made a preliminary determination to recommend that the SEC file an enforcement action against the Company alleging violations of various anti-fraud provisions of the federal securities laws.

The SEC staff informed the Company that the alleged violations of anti-fraud provisions of the federal securities laws pertain to purported false or misleading statements in connection with the Company’s 2021 PIPE and SPAC listing, relating to (i) related party transactions, and (ii) Mr.

Jia’s role in the Company.

An enforcement action may seek an injunction or cease-and-desist order against future violations of provisions of the federal securities laws, the imposition of civil monetary penalties, disgorgement or other equitable relief within the SEC’s authority, or any combination of the foregoing.

On June 27, 2025, Jiawei (Jerry) Wang, the Global President of the Company, received a Wells Notice from the SEC, and on June 30, 2025, YT Jia, Global Co-Chief Executive Officer, received a Wells Notice from the SEC.

Each of these notices also states that the SEC staff made a preliminary determination to recommend that the SEC file an enforcement action against them alleging similar violations in their individual capacities of various anti-fraud provisions of the federal securities laws detailed above.

An enforcement action may seek any of the above-referenced remedies, as well as a bar from serving as an officer or director of a public company.

Two other former Company employees also received Wells Notices.

A Wells Notice is neither a formal charge of wrongdoing nor a final determination that the recipient has violated any law but is a preliminary determination by the Staff to recommend to the SEC Commissioners that a civil enforcement action or administrative proceeding be brought against the recipients.

The Company and, Messrs.

Jia and Wang plan to engage with the SEC Staff about why an enforcement action is not warranted.

If the SEC determines to seek an enforcement action against the Company, Mr.

Jia, and/or Mr.

Wang, the SEC would need to proceed through a formal process, including formal court process for the director and officer bar, during which the Company, Mr.

Jia and/or Mr.

Wang, as applicable, could defend themselves.

On March 18, 2026, the Company received a letter from the SEC stating that the SEC staff does not intend to recommend an enforcement action by the SEC against the Company.

Company Founder and Global Co-Chief Executive Officer Yueting (YT) Jia, and Company Global President Jiawei (Jerry) Wang, confirmed that they received similar letters in their individual capacities.

However, this is not equivalent to an exoneration, and it is still possible that certain action may result from any future investigation by the SEC.

Such action could be detrimental to the Company, we may lose business cooperation with our actual and/or potential customers and vendors, and it may be more difficult for the Company to obtain additional financing on favorable terms, if at all.

Further, it may become more difficult to attract and retain key members of management, our board of directors and other key employees.

Any potential subsequent SEC investigation or enforcement actions can be expensive and disruptive, and we are obligated to indemnify each of the individuals for their costs associated with the investigation, and any resulting litigation with the SEC or related litigation brought by other parties, which may cause financial distress to the Company.

Our insurance, to the extent maintained, may not cover all claims that may be asserted against us or the specified individuals.

In addition, because the Company depends on Messrs.

Jia and Wang, the loss of their services may adversely impact the achievement of the Company’s objectives.

An unfavorable outcome may have an adverse impact on our business, financial condition, results of operations, prospects, reputation and/or our stock price.

In addition, Nasdaq has broad discretion and may determine to delist our securities from the Nasdaq Capital Market or other applicable trading market within the U.S.

Any proceeding could also negatively impact our reputation among our stakeholders.

Risks Related to Investing in Cryptocurrency

The launch of central bank digital currencies (“CBDCs”) may adversely impact our business.

The introduction of a government-issued digital currency could eliminate or reduce the need or demand for private-sector issued crypto currencies, or significantly limit their utility.

National governments around the world could introduce CBDCs, which could in turn limit the size of the market opportunity for cryptocurrencies.

If we were deemed to be an investment company under the Investment Company Act, applicable restrictions likely would make it impractical for us to continue segments of our business as currently contemplated.

Under Sections 3(a)(1)(A) and (C) of the Investment Company Act, a company generally will be deemed to be an “investment company” if (i) it is, or holds itself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting, or trading in securities or (ii) it engages, or proposes to engage, in the business of investing, reinvesting, owning, holding, or trading in securities and it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S.

government securities, shares of registered money market funds under Rule 2a-7 of the Investment Company Act, and cash items) on an unconsolidated basis.

Rule 3a-1 under the Investment Company Act generally provides that notwithstanding the Section 3(a)(1)(C) test described in clause (ii) above, an entity will not be deemed to be an “investment company” for purposes of the Investment Company Act if no more than 45% of the value of its assets (exclusive of U.S.

government securities, shares of registered money market funds under Rule 2a-7 of the Investment Company Act, and cash items) consists of, and no more than 45% of its net income after taxes (for the past four fiscal quarters combined) is derived from, securities other than U.S.

government securities, shares of registered money market funds under Rule 2a-7 of the Investment Company Act, securities issued by employees’ securities companies, securities issued by qualifying majority owned subsidiaries of such entity, and securities issued by qualifying companies that are controlled primarily by such entity.

We do not believe that we are an “investment company” as such term is defined in either Section 3(a)(1)(A) or Section 3(a)(1)(C) of the Investment Company Act.

Recently, we have begun focusing on pursuing opportunities to expand our portfolio into digital assets.

Since we believe cryptocurrency is not an investment security, we do not hold ourselves out as being engaged primarily, or propose to engage primarily, in the business of investing, reinvesting, or trading in securities within the meaning of Section 3(a)(1)(A) of the Investment Company Act.

With respect to Section 3(a)(1)(C), we believe we satisfy the elements of Rule 3a-1 and therefore are deemed not to be an investment company under, and we intend to conduct our operations such that we will not be deemed an investment company under, Section 3(a)(1)(C).

We believe that we are not an investment company pursuant to Rule 3a-1 under the Investment Company Act because, on a consolidated basis with respect to wholly-owned subsidiaries but otherwise on an unconsolidated basis, no more than 45% of the value of the Company’s total assets (exclusive of U.S.

government securities, shares of registered money market funds under Rule 2a-7 of the Investment Company Act, and cash items) consists of, and no more than 45% of the Company’s net income after taxes (for the last four fiscal quarters combined) is derived from, securities other than U.S.

government securities, shares of registered money market funds under Rule 2a-7 of the Investment Company Act, securities issued by employees’ securities companies, securities issued by qualifying majority owned subsidiaries of the Company, and securities issued by qualifying companies that are controlled primarily by the Company.

Cryptocurrency, as well as new business models and transactions enabled by blockchain technologies, present novel interpretive questions under the Investment Company Act.

There is a risk that assets or arrangements that we are to invest which are not securities could be deemed to be securities by the SEC or another authority for purposes of the Investment Company Act, which would increase the percentage of securities held by us for Investment Company Act purposes.

The SEC has requested information from a number of participants in the digital assets’ ecosystem, regarding the potential application of the Investment Company Act to their businesses.

For example, in an action unrelated to the Company, in February 2022, the SEC issued a cease-and-desist order under the Investment Company Act to BlockFi Lending LLC, in which the SEC alleged that BlockFi was operating as an unregistered investment company because it issued securities and also held more than 40% of its total assets, excluding cash, in investment securities, including the loans of digital assets made by BlockFi to institutional borrowers.

If we were deemed to be an investment company, Rule 3a-2 under the Investment Company Act is a safe harbor that provides a one-year grace period for transient investment companies that have a bona fide intent to be engaged primarily, as soon as is reasonably possible (in any event by the termination of such one-year period), in a business other than that of investing, reinvesting, owning, holding, or trading in securities, with such intent evidenced by the company’s business activities and an appropriate resolution of its board of directors.

The grace period is available not more than once every three years and runs from the earlier of (i) the date on which the issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis or (ii) the date on which the issuer owns or proposes to

acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of U.S.

government securities and cash items) on an unconsolidated basis.

Accordingly, the grace period may not be available at the time that we seek to rely on Rule 3a-2;

however, Rule 3a-2 is a safe harbor and we may rely on any exemption or exclusion from investment company status available to us under the Investment Company Act at any given time.

Furthermore, reliance on Rule 3a-2, Section 3(a)(1)(C), or Rule 3a-1 could require us to take actions to dispose of securities, limit our ability to make certain investments or enter into joint ventures, or otherwise limit or change our service offerings and operations.

If we were to be deemed an investment company in the future, restrictions imposed by the Investment Company Act — including limitations on our ability to issue different classes of stock and equity compensation to directors, officers, and employees and restrictions on management, operations, and transactions with affiliated persons — likely would make it impractical for us to continue our business as contemplated, and could have a material adverse effect on our business, results of operations, financial condition, and prospects.

The cryptocurrency we hold is not insured and not subject to FDIC or SIPC protections.

Currently, the Company does not plan to insure the cryptocurrencies the Company will purchase in the future.

Therefore, any loss that we may suffer with respect to our cryptocurrencies will not be covered by insurance and no person may be liable in damages for such loss, which could adversely affect our operations.

The Company does not plan to hold the cryptocurrencies with a banking institution or a member of the Federal Deposit Insurance Corporation (“FDIC”) or the Securities Investor Protection Corporation (“SIPC”) and, therefore, our cryptocurrency is not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions.

Impact of Rising International Political Tensions and Disruptions in Financial Markets on Our Business.

Rising international political tensions and disruptions in the financial markets and global economic conditions may adversely affect our business, operating results, and the value of our securities.

Political tensions between the United States and China have escalated in recent years due to, among other factors, the trade war between the two countries that began in 2018, the imposition of U.S.

sanctions on certain Chinese officials from China’s central government and the Hong Kong Special Administrative Region, the inclusion of Chinese entities and individuals on sanctions and other restrictive lists, the recently announced investment restrictions by the U.S.

government, and the imposition of sanctions, export, and import restrictions by the Chinese government on certain U.S.

government has made statements and taken actions that may lead to potential changes to U.S.

and international trade policies towards China.

Unfavorable government policies on international trade, such as capital controls or tariffs, could affect the demand for our products and services, impact the competitive position of our products, or prevent us from selling products in certain countries.

Furthermore, the application of tariffs or other trade barriers may significantly impact our ability to conduct business internationally, particularly with regard to the sale of electric vehicles (EVs), including battery electric vehicles (“BEVs”), in regions such as the U.S., where incentives and tax credits for BEVs may also be impacted by trade policy changes.

On May 14, 2024, the U.S.

government announced higher tariffs on steel and aluminum, semiconductors, electric vehicles, batteries, critical minerals, solar cells, ship-to-shore cranes and medical products.

These higher tariffs were based on claims that China has engaged in unfair trade practices.

The highest of these tariffs are applicable to electric vehicles, which will be subject to a tariff rate of 100% from August 1, 2024, an increase from the earlier rate of 25%.

Recently, the Trump administration imposed a 25% tariff globally on all the automobiles and parts imported to the U.S., effective on April 4, 2025.

On February 1, 2025, a 10% tariff was added on products imported from China.

On March 4, 2025, tariff applicable to products made in China was increased to 20%.

On April 2, 2025, an additional 34% tariff was imposed universally to Chinese-made products, which increased the applicable overall tariff to 54%.

On April 9, 2025, in response to the retaliation tariff announced by China, the Trump administration further raised the additional tariff to 84%, and on the same day, a reciprocal duty of 125% was charged to products imported from China, and the final applicable tariff rate reaches 145%.

On May 12, 2025, Chinese and the U.S.

government came to an agreement to temporarily reduce reciprocal tariffs by 115% starting May 14, 2025.

The effective tariff rate on products imported from China was reduced to 30%, while the Chinese tariff rate on American goods was reduced to 10%.

On October 9, 2025, China added five rare-earth elements to its exportation control list, which requires an export license that foreign producers will have to apply for if they plan to export products that use even slight amounts of Chinese-origin rare-earth minerals.

In response, on October 11, 2025, the Trump administration declared that a 100% tariff will be imposed on all importations from China, along with export controls on “any and all critical software from the U.S.” Recently, after a meeting between U.S.

and Chinese governments, the restriction mentioned above was lifted and the Trump administration will halt plans for such 100% additional tariffs for one year.

Furthermore, on February 20, 2026, the Supreme Court of the United States struck down various tariffs unilaterally imposed by President Trump in a series of executive orders under the International Emergency Economic Powers Act as unconstitutional.

Shortly thereafter, President Trump imposed a 15% tariff under the Trade Act of 1974, which can last only 150 days unless Congress approves an extension.

How the tariff war between the U.S.

and China will develop is highly uncertain, and difficult to predict.

Additionally, on January 16, 2025, the Bureau of Industry and Security issued a final rule entitled “Securing the Information and Communications Technology and Services Supply Chain:

Connected Vehicles” (the “Final Rule”), prohibiting certain transactions involving the sale or import of connected vehicles integrating specific hardware and software, or those components sold separately, with a sufficient nexus to China or Russia.

The implementation details of the Final Rule remain under evaluation, the Final Rule may have a material adverse impact on our financial performance or business operations.

Any new tariffs, import, export, or investment restrictions, or changes in existing trade agreements, particularly if the U.S.

government escalates trade tensions or takes retaliatory measures, could negatively affect our business, financial condition, and results of operations.

Recent policy change on the tax benefit of purchasing an electric vehicle may negatively affect the Company’s operations.

On July 4, 2025, H.R.

1, commonly referred to as the One Big Beautiful Bill Act (the "OBBBA"), was signed into law.

The bill provides consumers with a tax deduction for the interest on loans for certain U.S.-assembled vehicles and eliminates federal Electric Vehicle ("EV") tax credits for vehicles purchased or leased after September 30, 2025.

The termination of the EV tax credit, could have a material adverse effect on our business.

Currently, the EV tax credit plays a significant role in encouraging consumer adoption of electric vehicles, which in turn drives demand for our products.

The termination of the EV tax credit could reduce consumer purchasing power and slow the adoption of electric vehicles.

A decline in demand could negatively impact our sales, revenue growth, and profitability.

Additionally, such change to the EV tax credit could lead to increased competition or market uncertainty, as competitors may adjust their pricing and product offerings faster than us.

Jerry Wang, the President of FF, and Koti Meka, the Chief Financial Officer of FF, serve as the Co-Chief Executive Officer and the Chief Financial Officer of AIXC, respectively.

Such appointment may cause them to devote less time to the Company and could present conflicts of interest that we may not be able to resolve.

On October 2, 2025, Jerry Wang, the President of FF and Koti Meka, the Chief Financial Officer of FF were appointed by AIXC to be the Co-Chief Executive Officer and the Chief Financial Officer of AIXC, respectively.

As senior officers of both FF and AIXC, they may face challenges in fully dedicating their time, focus, and resources to our Company.

This divided attention could lead to delays in decision-making, diminished strategic oversight, and a reduced ability to effectively address operational issues, thereby negatively impacting our business performance.

Additionally, YT Jia, founder, Co-Global Chief Executive Officer, also serves as an advisor to AIXC.

Potential conflicts of interest may arise if the interests of the companies they manage and advise, as applicable, are not fully aligned.

These circumstances could result in compromised decision-making or actions that prioritize the interests of other companies over ours.

Furthermore, the concentration of leadership responsibilities in a small group of individuals managing multiple companies may raise concerns about governance and succession planning, as it could limit the diversity of leadership perspectives and create risks in developing suitable successors.

As a result, if we are unable to resolve potential conflicts of interest, the ability of these officers to execute on our strategic objectives could be impaired, which may harm our financial performance, shareholder value, and long-term business stability.

We may lose our controlling interest in AIXC as a result of issuances of securities by AIXC that dilute our existing ownership, which may adversely impact our crypto and Web3-related business.

In September 2025, the Company, through a strategic investment in AIXC as the lead investor in a PIPE transaction to establish a crypto and Web3-related business, obtained a controlling interest of AIXC.

In the event AIXC issues additional shares of its common stock, or securities convertible into its common stock, our majority interest in AIXC may be diluted such that we no longer have a controlling interest in AIXC, which would result in the deconsolidation of AIXC from our consolidated financial statements and could materially impact our financial position, results of operations, and cash flows.

In such event, we would no longer control AIXC’s strategic, operational, or financial decisions, and our ability to influence its business, including its crypto-related investment strategy and capital allocation, would be significantly reduced.

Additionally, we may be required to recognize a gain or loss upon deconsolidation and subsequently account for our retained interest under the equity method or at fair value, which could introduce increased volatility to our earnings.

Loss of control may also limit our ability to realize anticipated synergies and could adversely affect our growth strategy related to digital assets, Web3 initiatives, and diversification efforts.

Furthermore, AIXC operates in a highly volatile and evolving regulatory environment, and without control, we may have limited ability to manage associated risks, which could adversely affect our financial condition and results of operations.

Risks Related to our Operations in China

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As a result, we may not be aware of our violation of these policies and rules until sometime after the violation.

Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure to respond to changes in the regulatory environment in China could materially and adversely affect our business, impede the PRC Subsidiaries’ operations and reduce the value of your investment in us.

Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, and any failure to

respond to changes in the regulatory environment in China could materially and adversely affect our business, impede the PRC Subsidiaries’ operations and reduce the value of your investment in us.

Recently, the General Office of the State Council and another PRC authority jointly issued the “Opinions on Severely Cracking Down on Illegal Securities Activities According to Law” (the “Opinions”), which was promulgated on July 6, 2021.

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The Blocking Rules have become effective upon issuance, but have only established a framework of implementation, and the rules’ effects will remain unclear until the Chinese government provides clarity on the specific types of extraterritorial measures to which the rules will apply.

At this time, we do not know the extent to which the Blocking Rules will impact the operations of the PRC Subsidiaries.

At this time, we do not know the extent to which the

Blocking Rules will impact the operations of the PRC Subsidiaries.

There is no assurance that the PRC Subsidiaries will be able to comply fully with applicable laws and regulations should there be any amendment to the existing regulatory regime or implementation of any new laws and regulations.

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(ii) directly or indirectly used for investment in securities or investments other than banks’ principal-secured products unless otherwise provided by relevant laws and regulations;

(iii) the granting of loans to non-affiliated enterprises, except where it is expressly permitted in the business license;

(iii) the granting of loans to non-

affiliated enterprises, except where it is expressly permitted in the business license;

and (iv) paying the expenses related to the purchase of real estate that is not for self-use (except for the foreign-invested real estate enterprises).

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The manufacturers must apply to the MIIT for the entry approval to become a qualified manufacturer in China and must further apply to the MIIT for the entry approval for the new energy passenger vehicles before commencing the manufacturing and sale of the new energy passenger vehicles in China.

Both of the new energy passenger vehicles and their manufacturers will be listed in the Announcement of the Vehicle Manufacturers and Products issued by the MIIT from time to time, if they have obtained the entry approval from the MIIT.

of the new energy passenger vehicles and their manufacturers will be listed in the Announcement of the Vehicle Manufacturers and Products issued by the MIIT from time to time, if they have obtained the entry approval from the MIIT.

According to the Management Measures for Automobile Sales promulgated by the MOFCOM in July 2017, corporate basic information filings must be made by automobile dealers through the information system for the national automobile circulation operated by the MOFCOM within 90 days after the receipt of a business license.

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On August 16, 2021, the CAC and certain other PRC regulatory authorities promulgated the Several Provisions on the Management of Automobile Data Security (Trial Implementation), which came into effect on October 1, 2021 and clearly stipulates that:(i) to carry out personal information processing activities, automobile data processors must notify individuals of relevant information in a prominent manner, obtain personal consent or comply with laws and administrative regulations in other circumstances;

(ii) for the processing of sensitive personal information, the automobile data processor must obtain separate consent from individuals, and meet specific requirements;

(ii) for the processing of sensitive personal information, the automobile data processor must obtain

separate consent from individuals, and meet specific requirements;

and (iii) automobile data processors must collect biometric information only with sufficient necessity and for the purpose to enhance driving safety.

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As of the date of this Form 10-K, we have not received any notice from any PRC governmental authority identifying any of the PRC Subsidiaries as a “critical information infrastructure operator” or “network platform operator” that is engaged in data processing which affects or may affect national security as mentioned above, or requiring us to go through the cybersecurity review or initiating a cybersecurity review against us in such respects.

As advised by the PRC counsel, the above mentioned laws, regulations or the relevant drafts are relatively new and the PRC laws and regulations relating to cybersecurity, information security, data privacy and protection are evolving rapidly, there remains significant uncertainty in the enactment, interpretation and enforcement of such PRC laws, regulations or the relevant drafts, and the PRC Subsidiaries could become subject to enhanced cybersecurity review or non-compliance investigations launched by PRC regulators in the future.

drafts, and the PRC Subsidiaries could become subject to enhanced cybersecurity review or non-compliance investigations launched by PRC regulators in the future.

Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance investigations in accordance with the related laws and regulations may result in fines or other penalties, including suspension of business, website closure, and revocation of prerequisite licenses, as well as reputational damage or legal proceedings or actions to the PRC Subsidiaries, which may have material adverse effects on our business, financial condition or results of operations.

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China has adopted a revised securities law that became effective on March 1, 2020, Article 177 of which provides, among other things, that no overseas securities regulator is allowed to directly conduct investigation or evidence collection activities within the territory of the PRC.

Furthermore, on February 24, 2023, the CSRC and several other Chinese authorities promulgated the Provisions on Strengthening Confidentiality and Archives Administration of Overseas Securities Offering and Listing by Domestic Companies, which provide that where an overseas securities regulator and a competent overseas authority requests to inspect, investigate or collect evidence from a PRC domestic company concerning overseas offering and listing, or to inspect, investigate, or collect evidence from the PRC domestic securities companies and securities service providers that undertake relevant businesses for such PRC domestic companies, such inspection, investigation and evidence collection will be conducted under a cross-border regulatory cooperation mechanism, and the CSRC or other competent Chinese authorities will provide necessary assistance pursuant to bilateral and multilateral cooperation mechanisms.

necessary assistance pursuant to bilateral and multilateral cooperation mechanisms.

PRC domestic companies, securities companies and securities service providers must first obtain approval from the CSRC or other competent Chinese authorities before cooperating with the inspection and investigation by the overseas securities regulator or competent overseas authority, or providing documents and materials requested in such inspection and investigation.

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however, the remediation measures have been and will continue to be time consuming, costly, and a significant demand on our financial and operational resources.

While we believe these efforts will remediate the material weaknesses, it will not be considered remediated until we complete the design and implementation of the enhanced controls, the controls operate for a sufficient period of time, and we have concluded, through testing, that these controls are effective.

have concluded, through testing, that these controls are effective.

We may be unable to complete our evaluation, testing or any required remediation in a timely fashion, or at all.

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Risks Related to our Common Stock

We are currently unable to continue to utilize our “at-the-market” equity program.

If the closing price of our Common Stock is $0.10 per share or less for ten consecutive trading days, we would be immediately suspended from Nasdaq and the liquidity of our Common Stock would be materially harmed.

Pursuant to Nasdaq Listing Rule 5810(c)(3)(A)(iii), if the Company’s Class A common stock has a closing bid price of $0.10 or less for ten consecutive trading days before the Compliance Date, Nasdaq can issue a Staff Determination Letter, which would subject our Class A Common Stock to immediate suspension and delisting.

A delisting could substantially decrease trading in our Common Stock, adversely affect the market liquidity of our Common Stock as a result of the loss of market efficiencies associated with Nasdaq and the loss of federal preemption of state securities laws, materially and adversely affect our ability to obtain financing on acceptable terms, if at all, and may result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.

If we seek to implement a reverse stock split, the announcement or implementation of such a reverse stock split could negatively affect the price of our Common Stock.

Nasdaq has stated that a series of reverse stock splits may undermine investor confidence in securities listed on Nasdaq and they may determine that it is not in the public interest to maintain our listing, even if we regain compliance with the requirement to maintain a minimum closing bid price of $1.00 per share (the “Minimum Bid Price Requirement”).

While Nasdaq rules do not impose a specific limit on the number of times a listed company may effect a reverse stock split to maintain or regain compliance with the Minimum Bid Price Requirement, Nasdaq Listing Rule 5810(c)(3)(A)(iv) states that if a company effects a reverse stock split to regain compliance with the Minimum Bid Price Requirement and its stock price subsequently falls below the Minimum Bid Price Requirement during the 12-month period following such reverse stock split, it will not be eligible for any cure period to regain compliance (“Compliance Period”) with the Minimum Bid Price Requirement and Nasdaq will begin delisting procedures immediately.

Nasdaq Listing Rule 5810(c)(3)(A)(iv) further states that if a listed company that fails to meet the Minimum Bid Price Requirement after effecting one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, then we are not eligible for a Compliance Period.

We effected a 1-for-40 reverse stock split of our Common Stock on August 16, 2024, and may need to implement additional reverse splits in the near future in order for our share price to regain compliance with the Minimum Bid Price Requirement.

Accordingly, if we implement a reverse stock split, or multiple reverse stock splits, in the future to regain compliance with the Minimum Bid Price Requirement, and we subsequently fall out of compliance with such requirement, we may not be eligible for a Compliance Period and, as a result, our shares may be delisted from Nasdaq.

We may fail to regain compliance with the Minimum Bid Price requirement during the Compliance Period or maintain compliance with the other Nasdaq listing requirements.

In particular, the rights granted to FF Global under the Amended Shareholder Agreement or other similar rights granted to other investors may cause us to fall out of compliance with certain of Nasdaq’s Listing Rules, including Nasdaq Rule 5640, which disallows the voting rights of existing stockholders to be disparately reduced through any corporate action or issuance.

Any non-compliance may be costly, divert management’s time and attention, and could have a material adverse effect on our business, reputation, financing, and results of operations.

We currently lack the require share capital to comply with our existing obligations and will need to substantially increase our share capital to execute on our business strategy in 2026 and beyond.

The issuance of additional shares of Common Stock, including upon full conversion of the principal amount of all outstanding convertible notes, exercise of all outstanding warrants, the implementation of the full ratchet anti-dilution price protection in certain convertible notes and warrants, the issuance of shares pursuant to the SEPA, the issuance of shares pursuant to the ATM, and/or in additional future financings required in furtherance of executing on our business strategy, and/or in additional future financings required in furtherance of executing on our business strategy, and/or in additional future financings required in furtherance of executing on our business strategy, would substantially dilute the ownership interest of existing stockholders.

The shares of Common Stock issuable upon full conversion and exercise of our outstanding convertible notes and warrants, including our incremental warrants to purchase additional convertible notes, will result in significant additional dilution to our existing stockholders.

At various special meetings of stockholders, our stockholders approved (among other

proposals), as is required by the applicable Nasdaq rules and regulations, transactions involving issuance of our outstanding convertible notes and warrants (including our incremental warrants to purchase additional convertible notes), including the issuance of any shares in excess of 19.99% of the issued and outstanding shares of the Common Stock upon conversion of the such convertible notes and/or exercise of such warrants.

We currently lack sufficient share capital to meet our existing obligations.

We anticipate the need to raise a significant amount of capital in the future in order to execute our business strategy and we will be required to seek approval of our stockholders to substantially increase the amount of authorized capital stock under our Certificate of Incorporation.

Although the objective of any such increase in authorized capital stock will be to maintain our flexibility to raise money in the capital markets, including in the event of a reduction in the value of our shares, future issuances of Common Stock will dilute the voting power and ownership of our existing stockholders, and, depending on the amount of consideration received in connection with the issuance, could also substantially reduce our stockholders’ equity on a per-share basis.

To the extent our outstanding convertible notes are converted and our outstanding warrants are exercised and the convertible notes issuable upon exercise of our incremental warrants are so issued and converted, such conversions and exercises would have a significant dilutive effect on the ownership interest of our existing stockholders.

In addition, certain of our outstanding convertible notes and warrants contain customary full ratchet anti-dilution price protection, which would have a significant dilutive effect on the ownership interest of our existing stockholders if triggered.

Additionally, any issuance of shares of Common Stock under the ATM Program or the SEPA may cause substantial dilution to our existing stockholders.

The number of shares ultimately offered for sale pursuant to the ATM Program and/or the SEPA is dependent upon the number of shares we elect to sell under the ATM Program and/or SEPA.

Depending upon market liquidity at the time, sales of shares of our Common Stock under the ATM Program and/or SEPA may cause the trading price of our Common Stock to decline.

The sale of a substantial number of shares of our Common Stock pursuant to the ATM Program and/or SEPA, or anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales.

However, we have the right to control the timing and amount of any sales of our shares to pursuant to the ATM Program and/or SEPA, and each of the ATM Program and the SEPA may be terminated by us at our discretion without penalty.

We are currently unable to utilize our “at-the-market” equity program.

Our operations have consumed substantial amounts of cash since our inception.

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The ATM Program was the primary source of liquidity for us from September to December 2023.

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

Under applicable SEC rules and regulations, because of the late filing of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2025, our period of ineligibility to access the ATM Program under applicable SEC rules was extended.

We will not regain eligibility to utilize the ATM Program until no earlier than December 1, 2026, which is one year after the filing date of that Form 10-Q, at the earliest.

Should the Company fail to timely file any reports required under the Securities Act, the ineligibility period to use the ATM Program will further extend.

Although alternative public and private transaction structures may be available, these may require additional time and cost, may impose operational restrictions on us, and may not be available on attractive terms.

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Our equity holders would likely not receive any recovery at all in a bankruptcy scenario.

If we seek to implement a reverse stock split, the announcement or implementation of such a reverse stock split could negatively affect the price of our Common Stock.

Accordingly, Nasdaq may determine that it is not in the public interest to maintain our listing, even if we regain compliance with the Minimum Bid Price Requirement.

In addition, Nasdaq Listing Rule 5810(c)(3)(A)(iv) states that if a listed company that fails to meet the Minimum Bid Price Requirement after effecting one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, then we are not eligible for a Compliance Period.

We effected a 1-for-80 reverse stock split of our Common Stock on August 25, 2023, an additional 1-for-3 reverse stock split of our Common Stock on February 29, 2024, and a 1-for-40 reverse stock split of our Common Stock on August 16, 2024, for a cumulative ratio of 9,600 shares to one.

We may fail to regain compliance with the Minimum Bid Price requirement during the Compliance Period or maintain compliance with the other Nasdaq listing requirements.

Any non-compliance may be costly, divert management’s time and attention, and could have a material adverse effect on our business, reputation, financing, and results of operations.

We do not currently intend to pay dividends on our Common Stock and, consequently, your ability to achieve a return on your investment will depend on appreciation in the market price for our Common Stock.

We have no direct operations and no significant assets other than the ownership of the stock of our subsidiaries.

As a result, we will depend on our subsidiaries for distributions, loans and other payments to generate the funds necessary to meet our financial obligations, including our expenses as a publicly traded company, and to pay any dividends with respect to our Common Stock.

Common Stock.

Applicable state law and contractual restrictions, including in agreements governing our current or future indebtedness, as well as our financial condition and operating requirements and limitations on the ability of the PRC Subsidiaries’ ability to pay dividends or make payment to us, may limit our ability to obtain cash from our subsidiaries.

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• our ability to execute on our FX strategy;

• our ability to execute on our UAE strategy;

• our ability to execute on our U.A.E.

• our operating results failing to meet the expectation of securities analysts or investors in a particular period;

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Additionally, future changes in tax law or regulations in any jurisdiction where we operate or will operate could result in changes to the taxation of our income and operations, which could cause our after-tax profitability to be lower than anticipated.

Our potential future after-tax profitability could be subject to volatility or affected by numerous factors, including (a) the availability of tax deductions, credits, exemptions, refunds (including refunds of value added taxes) and other benefits to reduce our tax liabilities, (b) changes in the valuation of our deferred tax assets and liabilities, (c) expected timing and amount of the release of any tax valuation allowances, (d) tax treatment of stock-based compensation, (e) changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, (f) the potential expansion of our business into or otherwise becoming subject to tax in additional jurisdictions, (g) changes to our existing intercompany structure (and any costs related thereto) and business operations, (h) the extent of our intercompany transactions and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions and (i) our ability to structure our operations in an efficient and competitive manner.

release of any tax valuation allowances, (d) tax treatment of stock-based compensation, (e) changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, (f) the potential expansion of our business into or otherwise becoming subject to tax in additional jurisdictions, (g) changes to our existing intercompany structure (and any costs related thereto) and business operations, (h) the extent of our intercompany transactions and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions and (i) our ability to structure our operations in an efficient and competitive manner.

Due to the complexity of multinational tax obligations and filings, we may have a heightened risk related to audits or examinations by U.S.

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(vi) the issuance of up to 104,167 earnout shares pursuant to the triggering events in the merger agreement;

(vii) the issuance of up to 96,334 remaining registered shares of Common Stock that we may elect, in its sole discretion, to issue and sell to YA II PN Ltd.

(vii) the issuance of up to 96,334 remaining registered shares of Common Stock that

we may elect, in its sole discretion, to issue and sell to YA II PN Ltd.

(“Yorkville”) pursuant to the SEPA (as defined in Note 2, Liquidity and Capital Resources and Going Concern , to the Notes to Consolidated Financial Statements) (we currently do not have enough authorized and uncommitted shares to access the SEPA );

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Sales of substantial numbers of such shares in the public market, including the resale of the shares of Common Stock held by our stockholders, could adversely affect the market price of our Common Stock.

At various special meetings of stockholders, our stockholders approved (among other proposals), as is required by the applicable Nasdaq rules and regulations, transactions involving issuance of our outstanding convertible notes and warrants (including our incremental warrants to purchase additional convertible notes), including the issuance of any shares in excess of 19.99% of the issued and outstanding shares of the Common Stock upon conversion of the such convertible notes and/or exercise of such warrants.

Additionally, any issuance of shares of Common Stock under the ATM Program or the SEPA may cause substantial dilution to our existing stockholders.

The number of shares ultimately offered for sale pursuant to the ATM Program and/or the SEPA is dependent upon the number of shares we elect to sell under the ATM Program and/or SEPA.

Depending upon market liquidity at the time, sales of shares of our Common Stock under the ATM Program and/or SEPA may cause the trading price of our Common Stock to decline.

It is not possible to predict the actual number of shares we will sell under the SEPA, or the actual gross proceeds resulting from those sales.

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Such right granted to FF Top or other similar rights granted to other investors in the future may cause us to fall out of compliance with certain of Nasdaq’s listing rules, in particular Nasdaq Rule 5640, which disallows the voting rights of existing stockholders to be disparately reduced through any corporate action or issuance, and cause our Common Stock to be delisted from Nasdaq.

Our Third Amended and Restated Certificate of Incorporation, as amended provides, subject to limited exceptions, that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder litigation matters, which could limit your ability to obtain a chosen judicial forum for disputes with us or our directors, officers, employees or stockholders.

which could limit your ability to obtain a chosen judicial forum for disputes with us or our directors, officers, employees or stockholders.

Our Third Amended and Restated Certificate of Incorporation requires to the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and employees for breach of fiduciary duty and other similar actions may be brought in the Court of Chancery in the State of Delaware or, if that court lacks subject matter jurisdiction, another federal or state court situated in the State of Delaware.

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• We will indemnify our directors and officers for serving in those capacities or for serving other business enterprises at our request, to the fullest extent permitted by Delaware law.

Delaware law provides that a corporation may indemnify such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to any criminal proceeding, had no reasonable cause to believe such person’s conduct was unlawful;

Delaware law provides that a corporation may indemnify

such person if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant and, with respect to any criminal proceeding, had no reasonable cause to believe such person’s conduct was unlawful;

• We may, in our discretion, indemnify employees and agents in those circumstances where indemnification is permitted by applicable law;

25 unchanged sentences

These increased costs will require us to divert a significant amount of money that could otherwise be used to expand the business and achieve strategic objectives.

Advocacy efforts by stockholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

Advocacy efforts by stockholders and third parties may also prompt additional changes in governance and reporting

requirements, which could further increase costs.

Furthermore, the need to establish the corporate infrastructure demanded of a public company may divert management’s attention from implementing our growth strategy, which could prevent us from improving our business, results of operations and financial condition.

5 unchanged sentences

To the extent we choose not to use exemptions from various reporting requirements under the JOBS Act, we will incur additional compliance costs, which may impact earnings.

The JOBS Act permits “emerging growth companies” like ours to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.

The reduced reporting requirements applicable to us may make our Common Stock less attractive to investors.

We qualify as an “emerging growth company” as defined in Section 2(a)(19) of the Securities Act, as modified by the JOBS Act.

As such, we are eligible for and intends to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including, but not limited to, (a) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, (b) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and (c) exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

As a result, our stockholders may not have access to certain information they may deem important.

We will remain an emerging growth company until the earliest of (i) the last day of our fiscal year following July 24, 2025 (the fifth anniversary of the consummation of PSAC’s initial public offering), (ii) the last day of the fiscal year in which the market value of our shares of Common Stock that are held by non-affiliates exceeds $700.0 million as of June 30 of that fiscal year, (iii) the last day of the fiscal year in which we have total annual gross revenue of $1.235 billion or more during such fiscal year (as indexed for inflation) or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt in the prior three-year period.

We cannot predict whether investors will find our securities less attractive because it will rely on these exemptions.

If some investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards.

The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable.

We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

This may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

We cannot predict if investors will find our shares of Common Stock less attractive because we will rely on these exemptions.

If some investors find our shares of Common Stock less attractive as a result, there may be a less active market for our shares of Common Stock and our share price may be more volatile.

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-K

Item 1A. Risk Factors