1 Richard M. Pachulski (CA Bar No. 90073) Jeffrey W. Dulberg (CA Bar No. 181200) 2 Mahar S. Pagay (CA Bar No. 189289) PACHULSKI STANG ZIEHL & JONES LLP 3 10100 Santa Monica Blvd., 13th Floor Los Angeles, California 90067 4 Telephone: 310-277-6910 Facsimile: 310-201-0760 5 Email: [email protected] [email protected] 6 [email protected] 7 Counsel for Debtor and Debtor in Possession 8 Suzzanne Uhland (CA Bar No. 136852) Diana M. Perez (NY Bar No. 4636403) 9 O’MELVENY & MYERS LLP Times Square Tower 10 7 Times Square New York, New York 10036 11 Telephone: 212-326-2000 Facsimile: 212-326-2061 12 Email: [email protected] [email protected] 13 Special Corporate, Litigation, and International 14 Counsel for Debtor and Debtor in Possession 15 UNITED STATES BANKRUPTCY COURT CENTRAL DISTRICT OF CALIFORNIA 16 LOS ANGELES DIVISION 17 In re: 18 Case No. 2:19-bk-24804-VZ YUETING JIA,1 19 Chapter 11 Debtor. 20 FOURTH AMENDED DISCLOSURE STATEMENT WITH RESPECT TO 21 DEBTOR’S THIRD AMENDED PLAN OF REORGANIZATION UNDER CHAPTER 22 11 OF THE BANKRUPTCY CODE 23 Confirmation Hearing Date: May 21, 2020 24 Time: 9:30 a.m. (Pacific Time) Place: Courtroom 1368 25 Roybal Federal Building 255 E. Temple Street 26 Los Angeles, California 90012 Judge: Hon. Vincent P. Zurzolo 27 1 The last four digits of the Debtor’s federal tax identification number are 8972. The Debtor’s mailing address is 91 28 Marguerite Drive, Rancho Palos Verdes, CA 90275. 1 IMPORTANT INFORMATION FOR YOU TO READ 2 THE DEADLINE TO VOTE ON THE DEBTOR’S THIRD AMENDED PLAN OF 3 REORGANIZATION UNDER CHAPTER 11 OF THE BANKRUPTCY CODE (AS MAY 4 BE AMENDED OR MODIFIED, THE “PLAN”) IS APRIL 30, 2020 AT 4:00 P.M. BEIJING 5 TIME (THE “VOTING DEADLINE”). 6 FOR YOUR VOTE TO BE COUNTED, YOUR BALLOT MUST BE ACTUALLY 7 RECEIVED BY THE VOTING AGENT BEFORE THE VOTING DEADLINE AS 8 DESCRIBED HEREIN. 9 Yueting Jia, an individual in the United States (“YT” or the “Debtor”), as debtor and debtor 10 in possession, in the above-captioned chapter 11 case pending in the United States Bankruptcy 11 Court for the Central District of California (the “Bankruptcy Court”), is providing you with the 12 information in this amended disclosure statement with respect to the Plan (as may be amended or 13 modified, the “Disclosure Statement”) because you may be a creditor entitled to vote on the Plan.2 14 The Debtor believes that the Plan is in the best interests of his creditors. All creditors entitled 15 to vote on the Plan are urged to vote in favor of the Plan. A summary of the voting instructions is 16 set forth in Article I.B of this Disclosure Statement and in the order approving, among other things, 17 the Disclosure Statement [Docket No. 485] (the “Disclosure Statement Order”). More detailed 18 instructions are contained on the ballots distributed to the creditors entitled to vote on the Plan. To 19 be counted, your ballot must be properly completed in accordance with the voting instructions on 20 the ballot and actually received by the Voting Agent, via the e-balloting portal, regular mail, 21 overnight courier, or personal delivery at the appropriate address, by the Voting Deadline. 22 The effectiveness of the Plan is subject to material conditions precedent. See Article IV.N 23 below entitled “Conditions Precedent to Confirmation and the Effective Date” and Article X of the 24 Plan. There is no assurance that these conditions will be satisfied or waived. 25 This Disclosure Statement, the Plan Supplement, and any attachments, exhibits, 26 supplements, and annexes hereto are the only documents to be used in connection with the 27 2 Except as otherwise set forth herein, capitalized terms used in this Disclosure Statement but not defined herein have the meanings used in the Plan. Unless otherwise indicated, all amounts in this Disclosure Statement are reflected in 28 U.S. dollars. - 2 - 1 solicitation of votes on the Plan. YT has not authorized any person to give any information or to 2 make any representation in connection with the Plan or the solicitation of acceptances of the Plan 3 other than as contained in this Disclosure Statement, the Plan Supplement, and any attachments, 4 exhibits, supplements, and annexes attached hereto or incorporated by reference or referred to 5 herein. If given or made, such information or representation may not be relied upon as having been 6 authorized by YT. The delivery of this Disclosure Statement will not under any circumstances 7 imply that the information herein is correct as of any time after the date hereof. 8 ALL CREDITORS ENTITLED TO VOTE ON THE PLAN ARE ENCOURAGED 9 TO READ AND CAREFULLY CONSIDER THIS ENTIRE DISCLOSURE STATEMENT, 10 INCLUDING THE PLAN ATTACHED AS EXHIBIT A, THE PLAN SUPPLEMENT, AND 11 THE RISK FACTORS DESCRIBED IN ARTICLE VI BELOW, BEFORE SUBMITTING 12 BALLOTS IN RESPONSE TO THIS SOLICITATION. 13 ARTICLES VI AND XI OF THE PLAN CONTAIN RELEASE, EXCULPATION, 14 AND INJUNCTION PROVISIONS, WHICH ARE DISCUSSED IN ARTICLE IV.M OF 15 THIS DISCLOSURE STATEMENT. YOU SHOULD REVIEW AND CONSIDER THE 16 PLAN CAREFULLY BECAUSE IT MAY AFFECT YOUR RIGHTS. 17 The summaries of the Plan and other documents contained in this Disclosure Statement are 18 qualified in their entirety by reference to the Plan itself, the exhibits thereto, and documents 19 described therein as filed prior to approval of this Disclosure Statement or subsequently as part of 20 the Plan Supplement. In the event that any inconsistency or conflict exists between this Disclosure 21 Statement and the Plan, or between the Plan Supplement and the Plan, the terms of the Plan will 22 control. Except as otherwise indicated herein or in the Plan, YT will file all Plan Supplement 23 documents with the Bankruptcy Court and make them available for review on the Debtor’s case 24 website located online at https://dm.epiq11.com/yt1 no later than five days before the Voting 25 Deadline or such later date as the Bankruptcy Court may approve. 26 This Disclosure Statement contains, among other things, descriptions and summaries of 27 provisions of the Plan. YT reserves the right to amend or modify the Plan consistent with section 28 1127 of the Bankruptcy Code and Bankruptcy Rule 3019. - 3 - 1 The statements contained in this Disclosure Statement are made only as of the date of this 2 Disclosure Statement, and there can be no assurance that the statements contained herein will be 3 correct at any time after this date. The information contained in this Disclosure Statement, including 4 the information regarding the background of YT and his businesses and the financial and valuation 5 information regarding YT and his businesses is included for purposes of soliciting acceptances of 6 the Plan, but, as to contested matters and adversary proceedings, is not to be construed as an 7 admission or stipulation, but rather as a statement made in settlement negotiations as part of YT’s 8 attempt to settle and resolve claims and controversies pursuant to the Plan. The information 9 contained in this Disclosure Statement will not be admissible in any non-bankruptcy proceeding, 10 nor will it be construed to be conclusive advice on the tax, securities, or other legal effects of the 11 Plan as to holders of Allowed claims against either the Debtor or the Debtor as reorganized under 12 the Plan, and any successor thereto on or after the Effective Date (the “Reorganized Debtor”). 13 Except where specifically noted, the financial information contained in this Disclosure Statement 14 and in its exhibits has not been audited by a certified public accountant and has not been prepared 15 in accordance with generally accepted accounting principles in the United States. 16 FORWARD-LOOKING STATEMENTS 17 This Disclosure Statement contains “Forward-Looking Statements.” All statements (other 18 than statements of historical facts) included in this Disclosure Statement regarding operations, 19 financial position, plans, and business strategy of YT or FF Intelligent Mobility Global Holdings 20 Ltd. (“FF Intelligent”),3 the parent company of Faraday & Future Inc. (“FF” and collectively with 21 other operational entities owned and/or controlled by FF Intelligent and together with FF 22 Intelligent, the “FF Group”), and statements regarding the industry in which the FF Group operates, 23 may constitute forward-looking statements. Forward-looking statements generally can be identified 24 by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “estimate,” 25 “anticipate,” “believe,” or “continue” or the negative thereof or variations thereon or similar 26 3 27 Pursuant to the Sixth Amended and Restated Memorandum and Articles of Association of FF Intelligent Mobility Global Holdings Ltd. (f/k/a Smart King Ltd.) adopted February 10, 2020 (the “FF Intelligent M&A”), Smart King Ltd. (“Smart King”) was renamed as FF Intelligent Mobility Global Holdings Ltd. to align the corporate names of the 28 entities of the FF Group. - 4 - 1 terminology. Although the expectations reflected in such forward-looking statements are believed 2 by YT to be reasonable at this time, YT can give no assurance that such expectations will prove to 3 have been correct. Important factors that could cause actual results to differ materially from such 4 expectations are disclosed in Article VI of this Disclosure Statement, including, without limitation, 5 in conjunction with the forward-looking statements included in this Disclosure Statement under the 6 heading “Certain Risk Factors to be Considered.” All subsequent written and oral forward-looking 7 statements attributable to YT, the FF Group, or persons acting on his or their behalf are qualified 8 in their entirety by these cautionary statements.