Originally thought to get Evergrande investment will let Jia Yueting Pavilion set up the electric car company FF Salted fish turned over, but with the UFC but let it plunge into a deeper capital crisis. FF is facing serious cash flow difficulties due to UFC health (0708.HK) defaults, according to information sent to the Huaxia times on October 31. To reduce spending, FF will ' temporarily ' keep some employees on leave, leaving only 500 core employees to advance FF91 mass production.
In addition, two of FF's core executives have resigned in recent days, including Nick Sampson, one of FF's three co-founders. FF expects a ' temporary transition period ' of approximately two months.
Two months is enough for FF to find the new financing to make UFC nod? And as FF funds dry up, FF has been stressing the FF91 mass production will face what kind of fate?
Desperately throttling.
Throttling became the only effort FF could make before new financing was in place. In an internal letter issued on October 31, FF said most of the employees who joined FF after May 1 this year will be unpaid in November and December.
For employees who joined before May 1 this year, they will continue to stay at the company to promote FF 91 mass production delivery, but wages need to be temporarily reduced. FF also said that all employees will continue to enjoy the original benefits such as health insurance.
According to the Huaxia Times, FF's core team includes more than 500 employees, mainly to complete the FF91 mass production and delivery of engineering research and development, manufacturing and supply chain team. In response to the financial crisis, FF announced a layoff pay cut plan on October 21. FF announced a 20% reduction in the annual salary of all employees. At the same time, Jia Yueting Pavilion himself will receive only one dollar a year's salary. The company promised to restore its original salary when the funds were in place.
The previous announcement by UFC health showed that FF had nearly 1400 employees worldwide as of June 2018, about 1000 of whom were technical professionals. It should be mentioned that after slipping back into the financial woes, FF has core executives leaving. Nick Sampson Nick Sampson, one of FF's three co-founders, announced his departure October 30, leaving the three founders of FF with only Jia Yueting Pavilion. According to reporters, Nick Sampson at FF as Senior Vice president of global products.
In addition, Peter Savagian Peter Savagian, senior vice president of global R & amp; d at FF, has also left. According to FF, a series of recent defaults on UFC health have led FF to face severe cash flow difficulties, ' UFC health, the biggest shareholder, has undermined FF's funding plans and thwarted FF's actions to use its own asset mortgage financing.
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The rift between FF and UFC was made public three months after the official announcement of cooperation. October 7, Evergrande Health release announced that FF original shareholders (FF Top Holding Ltd., the actual control of the Jia Yueting Pavilion) used his right to a majority of the directors of the joint venture company to manipulate the joint venture smart King. In addition, Smart King filed an arbitration with the Hong Kong International Arbitration Centre on October 3 to deprive Shiying, a wholly owned health company, of its right to consent to finance as a shareholder and to terminate all agreements and deprive Shiying of its rights under the relevant agreement.
At present, Evergrande Health ranks FF's number one shareholder with a 45% per cent stake. For the cause of the break, the two sides are currently disagree. But the announcement shows that in July this year FF original shareholders proposed that the first investment has been basically exhausted, the request of Ying in advance to pay 700 million of dollars.
This not only means that the Jia Yueting Pavilion spent only two months on the UFC's first $800 million investment, but also means that so far FF has not been recorded for new funds for nearly four months.
Emergency seeking financing Finding new financing is FF's top priority at the moment. Media quoted Nick Sampson's resignation letter as saying: ' The company's financial and personnel assets are in fact insolvent.
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The results of the previous emergency arbitration between FF and UFC health provided the possibility for FF to find new financing. On the evening of October 25, the UFC health announcement announced that, as a temporary rescue measure, in order to support Smart King's business development and protect the common interests of shareholders, the arbitrator agreed to smart King to carry out a strictly conditional financing, in which the valuation of new shares must not be less than Shiying post-investment valuation, Shiying enjoys the right of preemption of new shares.
FF shall not exceed 500 million US dollars in external financing before the final arbitration. People close to the UFC have told the Huaxia Times that the purpose of emergency arbitration is not to let Jia Yueting Pavilion's company go bankrupt, and the official results will be different. But the new financing must go through the UFC agreement, and the UFC has a lot of preemptive rights.
The person also told reporters that Heng Dafa Faraday is currently functioning normally. But FF related sources told the Huaxia times that ' there is only one appeal for this emergency bailout, which is to open up 500 million of dollars in financing. This is the case in the big arbitration for the UFC's claim to completely deprive UFC of its right to consent to finance, and the outcome of this arbitration will take three to 6-18 months to produce results.
' However, although the result of emergency arbitration, but the UFC and FF between the war of words has intensified. Recently, FF and the UFC side have accused each other of confusing and misleading the public.
A number of industry insiders believe that the entanglements between the UFC and FF will affect the entry of FF's new financing. In an internal letter dated October 31, FF cited its acquisition of a series of technology patents, which it considered to be the competitiveness and value of FF. But for investors, the more intuitive chip is the mass production of FF91. FF's previous plan was to achieve FF91 mass production in the first quarter of 2019, according to the Huaxia Times.
In fact, after the public conflict with the UFC, FF also still said in a previous internal letter that it has the ability to deliver FF91 to global markets and booking users in 2019. But FF, which is running out of money, does not seem to be completing its plans on schedule. FF Management has decided to close the company's headquarters in Gardena, California, and some of its operations at the Hanford Plant this week, it has emerged. And FF related people also told the Huaxia Times, FF91 next year mass production time should be affected, but the time is not too good to say. ' We should wait until we get the financing before we extrapolate.
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One question that needs to be mentioned is, if FF91 cannot be mass-produced, can the voting rights of the ' 1 shares of 10 votes ' currently enjoyed by Jia Yueting Pavilion in the joint venture be retained? FF Urgently Seek Financing | Will the two-month transition period at Jia Yueting Pavilion be a life-and-death point?