California-based electric vehicle (EV) startup Faraday Future announced on April 7 that it received a notice from the Nasdaq Stock Exchange on April 4, claiming that its delay in submitting a 2021 financial report (10-K form) violated terms for listing. If Faraday Future intends to remain a listed company, the exchange requires it to meet compliance standards before April 19.
According to Chinese media outlet Securities Daily, a spokesperson for Faraday Future said on April 8 that the company was expected to receive the warning document, and efforts would be made to submit an update to the original plan before April 19 to restore compliance. In addition, the individual said that “Nasdaq granted Faraday Future an exception, allowing the submission of 10-Q and 10-K to be completed before May 6, 2022.”
On February 1 of this year, Faraday Future submitted a statement (8-K form) to the the United States Securities and Exchange Commission (SEC). Since then, some members of the company’s management team and employees have received security notices and subpoenas from SEC staff, and the reason for investigation is that the company is suspected of publishing inaccurate information to investors.
A survey found that only several hundred of the 14,000 FF 91 vehicle orders claimed by the company have actually been paid for by customers. Accordingly, Faraday Future announced in late March that it needed extra time to complete the internal investigation, as company executives were suspected of misleading consumers with false statements. Due to a delay caused by the internal investigation, the annual financial report cannot be submitted on time.
This is the second time that Faraday Future has delayed submitting its financial reports. The last time was the third quarter financial report in 2021, for which it also received a delisting warning from the U.S. Stock Exchange.
Faraday Future was founded in May 2014 and listed on the Nasdaq through SPAC on July 22, 2021. The highest its share price has risen was $20.75. But as of today, its shares are just $4.24 apiece.