The feast-or-famine financials that have blighted Faraday Future for two years look near a turning point. Its beleaguered founder has secured majority votes from creditors for his personal debt-restructuring plan, according to a US court filing by bankruptcy agency EPIQ on Thursday.

Why it matters: As the agreement with creditors is being reached, it may allow Faraday Future to get new money to launch its long-awaited FF91 in China, the world’s biggest EV market.

  • Founder Jia Yueting’s debt problems have nearly caused a halt to the operation of the California-based EV maker for years.
  • In a restructuring plan sent to creditors last month, Jia said some well-known investors are “waiting for the restructuring results” before moving to next steps for partnership discussions with the company.

Details: In a filing to the California Central District Court on Tuesday, 75 out of around 100 creditors cast ballots on Jia’s bankruptcy plan. 61 of them voted in favor, representing 81.33% of the total amount of debt, while the remaining 15 opposed.

  • US bankruptcy laws dictate that a plan is accepted when more than half of total creditors hold at least two-thirds in the amount of debt.
  • The court is slated to approve the Chapter 11 case in a hearing scheduled for May 21.
  • Jia filed for bankruptcy under Chapter 11 of the US bankruptcy Code in October in an effort to deal with his debts of around $3.6 billion by forming a creditor trust using his ownership stake in Faraday.
  • Creditors will not have voting rights in the EV startup, and will only get paid when the startup goes public.
  • Jia relinquished his control by stepping down as the CEO of the company in September.
  • He still has the power to make decisions, though, as the “chief product and user officer” of Faraday Future

Context: Faraday Future has been looking to raise $850 million since September when former BMW executive Carsten Breitfeld took over as CEO.

  • Breitfeld revealed plans to launch its first luxury electric SUV model FF91 in China by Sep. 2020, or nine months after the funding is secured, and another three to six months for an IPO.  
  • Faraday Future is currently in talks with governments of three Chinese provincial capitals for its China’s headquarters, as well as two automakers for manufacturing partnerships, according to Jia’s restructuring plan.
  • The would-be EV maker last month obtained a $9 million loan from US government for small businesses during the Covid-19 outbreak, The Verge reported.

Jill Shen is Shanghai-based technology reporter. She covers Chinese mobility, autonomous vehicles, and electric vehicles. Connect with her via e-mail: jill.shen@technode.com