--- type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/39682390.md" description: "$Faraday Future Intelligent Electric(FFAI.US)For FF (FFAI/formerly FFIE), the reason it didn't convert shares when the stock price was $1–3, but did so in large volumes only when it dropped to $0.2–0.3, is fundamentally the result of overlapping factors: contract terms, conversion price adjustment mechanisms, creditor strategies, and the company's life-or-death gamble. It's not "intentionally waiting for a low price," but rather that conversion could only be triggered at a low price. 1. Conversion isn't possible just because you want to: It's locked by the conversion/floor price. - Most of FF's convertible notes (SPA notes) have a fixed conversion price or a minimum floor price:- 2022: $2.2865, $2.69 - End of 2024: $1.16 - March 2025: $1.048 - Stock price > Conversion price: Creditors would lose money converting (same debt for fewer shares), so they absolutely won't convert.- Stock price falls far below the floor price: Only then is an automatic downward adjustment triggered / conversion at a market price discount (commonly 90% VWAP).- Conclusion: At $1–3, the price was mostly above the conversion/floor price, making conversion impossible; only when it dropped to $0.2–0.3 were the conversion conditions met. 2. For the company to lower the conversion price, it must agree only at a life-or-death moment. - Lowering the price = same debt for many more new shares, severely diluting existing shareholders.- At $1–3: The company still wanted to support the stock price, avoid delisting, and negotiate new strategic investments, so it refused to lower the price.- At $0.2–0.3: On the brink of bankruptcy/delisting, with no conversion meaning debt + interest repayment at maturity (FF simply has no money).- At this point: The company is forced to agree to a significant price reduction, and creditors get shares at a rock-bottom price. 3. Creditors intentionally depress the price / wait for a crash: To maximize share count. - Creditors knew FF had high interest + broken cash flow, so the stock price was bound to fall.- Converting at $1–3: Few shares, selling wouldn't yield much profit; converting at a few dimes:- Debt converts to dozens of times more shares ($1M debt @$0.2=5M shares, @$2=500K shares)- Obtains an absolute controlling stake, clears out old shareholders, replaces management.- Classic vulture investing: The lower it falls, the more you profit. 4. US stock rules + reverse splits + authorization limits - Nasdaq's **$1 delisting threshold**: At $1–3, the company was maintaining compliance, not doing reverse splits.- Dropping to $0.2–0.3: Must reverse split + increase authorized shares to issue the massive number of new shares for conversion.- Previously, there weren't enough shares authorized; even if they wanted to convert, they couldn't issue the shares. 5. In a nutshell It's not "insisting on waiting for a low price," but that the terms didn't allow it and the company wouldn't permit conversion at a high price; only when it dropped to the brink of bankruptcy did the terms trigger + the company was forced to agree + creditors maximized their gains, leading to concentrated conversion." datetime: "2026-04-01T19:29:34.000Z" locales: - [en](https://longbridge.com/en/topics/39682390.md) - [zh-CN](https://longbridge.com/zh-CN/topics/39682390.md) - [zh-HK](https://longbridge.com/zh-HK/topics/39682390.md) author: "[leewldch](https://longbridge.com/en/profiles/11893175.md)" --- # $Faraday Future Intelligent Electric(FFAI.US)For F… ### Related Stocks - [FFAI.US](https://longbridge.com/en/quote/FFAI.US.md) - [FFIE.US](https://longbridge.com/en/quote/FFIE.US.md) - [FFAI.美国市场](https://longbridge.com/en/quote/FFAI.美国市场.md) - [FF.US](https://longbridge.com/en/quote/FF.US.md) - [FFAIW.US](https://longbridge.com/en/quote/FFAIW.US.md) ## Comments (2) - **TSLA赚的米补仓FFAI · 2026-04-02T15:04:49.000Z**: Very professional, is this what it means:"Bond interest is too high, no cash to repay → creditors depress the stock price to force the company to convert shares → creditors get more shares to gain control → wash out management and sell patents/shell for profit?"The lower the stock price, the - **leewldch** (2026-04-02T15:08:59.000Z): Yes. So this convertible bond financing method most likely means the stock price falls, followed by a share issuance, a reverse stock split, wiping out all retail investors.