Faraday Future, the embattled electric vehicle manufacturer, has sparked controversy with its latest executive compensation packages, which include substantial salary increases and bonuses for its CEO and founder. Despite the company’s dismal delivery record of just 13 vehicles in 10 years, Matthias Aydt and Jia Yueting are set to receive significant pay bumps.
According to a regulatory filing, Aydt’s annual salary will surge from $400,000 to $700,000, accompanied by a one-time bonus of $500,000 and an annual discretionary target bonus of $700,000. Additionally, he will receive two annual stock grants valued at over $4 million. Similarly, Yueting’s salary will rise from $450,000 to $680,000, with a $500,000 recognition bonus, an annual discretionary target bonus of $816,000, and two annual stock grants exceeding $4 million in value.
The timing of these lucrative compensation packages has raised eyebrows, given Faraday Future’s precarious financial situation. The company’s second-quarter financials revealed a paltry $793,000 in unrestricted cash, and it has recently secured $22.5 million in new financing commitments through convertible notes and warrants. This comes on the heels of widespread layoffs and furloughs, as well as a narrowly averted eviction from its Los Angeles headquarters in February 2024.
Faraday Future’s troubled past continues to cast a shadow, with the company facing allegations of falsifying sales figures in a pair of whistleblower lawsuits. Although the company has denied these claims, it has acknowledged that a third employee has come forward with similar allegations. Moreover, the Securities and Exchange Commission is actively investigating the company, having issued two additional subpoenas in the first half of this year.
The compensation packages for Aydt and Yueting are contingent upon certain conditions. Initially, they will receive prorated salaries of $550,000 and $612,000, respectively, with the stipulation that they must use at least $340,000 of this amount to purchase company stock. The remainder of their raises will only be granted if and when the company restores the full salaries of all other employees, who have been working at reduced wages. The one-time bonuses will be paid out in installments, with 25% disbursed on September 30, another 25% on October 31, and the rest on the earlier of September 30, 2025, or the completion of a funding round exceeding $30 million.
