SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



x☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ~~AND~~ EXCHANGE ACT OF 1934

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes o☒ No x☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x☒ No o☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange ~~Act:~~

Large accelerated filer

o☒

Accelerated filer

o☐

Non-accelerated filer

x☐

Smaller reporting company

o☐

Emerging growth company

x☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o☐ No x☒

As of ~~June 7, 2019,~~August 10, 2022, the registrant had ~~60,122,797~~63,667,728 shares of common stock, $0.0001 par value per share, outstanding.

Note Regarding Forward-Looking Statements

This ~~Quarterly Report on Form 10-Q~~report includes forward-looking statements within the meaning of the federal securities ~~laws.~~laws that involve risks and uncertainties concerning the business, products and financial results of Beyond Meat, Inc. (including its subsidiaries unless the context otherwise requires, “Beyond Meat,” “we,” “us,” “our” or the “Company”). We have based these forward-looking statements largely on our current opinions, expectations, beliefs, plans, objectives, assumptions and projections about future events and financial trends affecting the operating results and financial condition of our business. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

~~estimates~~•the effects of the COVID-19 pandemic on our business, financial condition, cash flows and results of operations, including on our supply chain, the demand for our products, our product and channel mix, labor needs at the Company as well as in the supply chain and at customers, the timing and level of retail purchasing, the timing and level of foodservice purchasing, our manufacturing and co-manufacturing facilities and operations, our inventory levels, our ability to expand and produce in new geographic markets or the timing of such expansion efforts, the pace and success of new product introductions, the timing of new foodservice launches, and on overall economic conditions and consumer confidence and spending levels;

•the impact of uncertainty in our domestic and international supply chain, including labor shortages and disruption and shipping delays and disruption;

•a resurgence of COVID-19 and the impact of variants of the virus that causes COVID-19, which could slow, halt or reverse the reopening process, or result in the reinstatement of social distancing measures, business closures, restrictions on operations, quarantines, lockdowns and travel bans;

•the impact of inflation and rising interest rates across the economy, including higher food, grocery, raw materials, transportation, energy, labor and fuel costs;

•reduced consumer confidence and consumer spending, including spending to purchase our products, and negative trends in consumer purchasing patterns due to consumers’ disposable income, credit availability, debt levels and inflation;

•the impact of uncertainty as a result of doing business in China and Europe;

•government or employer mandates requiring certain behaviors from employees due to COVID-19, including COVID-19 vaccine mandates, which could result in employee attrition at the Company, suppliers and customers as well as difficulty securing future labor and supply needs;

•the impact of adverse and uncertain economic and political conditions in the U.S. and international markets;

•the volatility of capital markets and other macroeconomic factors, including due to geopolitical tensions or the outbreak of hostilities or war;

•foreign exchange rate fluctuations;

•our ability to effectively manage our growth in the United States and abroad;

•our ability to streamline operations and improve cost efficiencies, which could result in the contraction of our ~~expenses, future revenues, capital requirements~~business and the implementation of significant cost cutting measures;

•our ability to identify and execute cost-down initiatives intended to achieve price parity with animal protein;

•the success of operations conducted by joint ventures, such as the Planet Partnership, LLC (“TPP”) with PepsiCo, Inc., where we share ownership and management of a company with one or more parties who may not have the same goals, strategies or priorities as we do and where we do not receive all of the financial benefit;

•the effects of increased competition from our market competitors and new market entrants;

•changes in the retail landscape, including the timing and level of trade and promotion discounts, our ability to grow market share and increase household penetration, repeat purchases, buying rates (amount spent per buyer) and purchase frequency, and our ~~needs for additional financing;~~ability to maintain and increase sales velocity of our products;

•changes in the foodservice landscape, including the timing and level of marketing and other financial incentives to assist in the promotion of our products, our ability to grow market share and attract and retain new foodservice customers or retain existing foodservice customers, and our ability to introduce and sustain offering of our products on menus;

•the timing and success of distribution expansion and new product introductions in increasing revenues and market share;

•the timing and success of strategic Quick Service Restaurant (“QSR”) partnership launches and limited time offerings resulting in permanent menu items;

•our estimates of the size of our market ~~opportunities;~~

~~our~~opportunities and ability to ~~effectively manage our~~accurately forecast market growth;

•our ability to effectively expand or optimize our manufacturing and production ~~capacity;~~capacity, including effectively managing capacity for specific products with shifts in demand;

•risks associated with underutilization of capacity which could give rise to increased costs, underutilization fees and termination fees to exit certain supply chain arrangements and/or the write-off of certain equipment;

•our inability to sell our inventory in a timely manner requiring us to sell our products through liquidation channels at lower prices, write-down or write-off obsolete inventory, or increase inventory reserves;

•our ability to accurately forecast our future results of operations, including fluctuations in demand for our products and increased competition;

•our ability to accurately forecast demand for our products and manage our inventory, including the impact of customer orders ahead of holidays and shelf reset activities, and supply chain and labor disruptions;

•our operational effectiveness and ability to fulfill orders in full and on time;

•variations in product selling prices and costs, and the mix of products sold;

•our ability to successfully enter new geographic markets, manage our international expansion and comply with any applicable laws and ~~regulations;~~regulations, including risks associated with doing business in foreign countries, substantial investments in our manufacturing operations in China and the Netherlands, and our ability to comply with the U.S. Foreign Corrupt Practices Act (“FCPA”) or other anti-corruption laws;

•the effects of ~~increased competition from our market competitors;~~global outbreaks of pandemics or contagious diseases or fear of such outbreaks, such as COVID-19;

•the success of our marketing ~~efforts~~initiatives and the ability to grow brand awareness, ~~and~~ maintain, protect and enhance our ~~brand;~~brand, attract and retain new customers and grow our market share;

•our ability to attract, maintain and effectively expand our relationships with key strategic foodservice partners;

•our ability to attract and retain our suppliers, distributors, co-manufacturers and customers;

•our ability to procure sufficient ~~high quality,~~high-quality raw materials at competitive prices to manufacture our ~~products;~~products, especially those impacted by the conflict in the Ukraine or problems in the global supply chain exacerbated by COVID-19 lockdowns in China;

•the availability of pea ~~protein~~and other proteins that meets our standards;

•our ability to diversify the protein sources used for our products;

•our ability to differentiate and continuously create innovative products, respond to competitive innovation and achieve speed-to-market;

•our ability to successfully execute our strategic initiatives;

•the volatility associated with ingredient, packaging, transportation and other input costs;

iii

•real or perceived quality or health issues with our products or other issues that adversely affect our brand and reputation;

~~changes~~•our ability to accurately predict consumer taste preferences, trends and demand and successfully innovate, introduce and commercialize new products and improve existing products, including in ~~the tastes and preferences of our consumers;~~new geographic markets;

•significant disruption in, or breach in security of our information technology systems and resultant interruptions in service and any related impact on our ~~reputation;~~reputation, including related to data privacy;

•the ability of our transportation providers to ship and deliver our products in a timely and cost effective manner;

•management and key personnel changes, the attraction, training and retention of qualified employees and key ~~personnel;~~personnel and our ability to maintain our company culture;

•the effects of organizational changes including a reduction-in-force and realignment of reporting structures;

•risks related to use of a professional employer organization to administer human resources, payroll and employee benefits functions for certain of our international employees, and use of certain third- party service providers for the performance of several business operations including payroll and human capital management services;

•the effects of natural or man-made catastrophic or severe weather events particularly involving our or any of our co-manufacturers’ manufacturing facilities or our suppliers’ facilities;

•the impact of marketing campaigns aimed at generating negative publicity regarding our products, brand and the plant-based industry category;

•the effectiveness of our internal controls;

•accounting estimates based on judgment and assumptions that may differ from actual results;

•the requirements of being a public company and effects of increased administration costs related to compliance and reporting obligations;

•our significant indebtedness and ability to repay such indebtedness;

•risks related to our debt, including limitations on our cash flow from operations and our ability to satisfy our obligations under the convertible senior notes; our ability to raise the funds necessary to repurchase the convertible senior notes for cash, under certain circumstances, or to pay any cash amounts due upon conversion; provisions in the indenture governing the convertible senior notes delaying or preventing an otherwise beneficial takeover of us; and any adverse impact on our reported financial condition and results from the accounting methods for the convertible senior notes;

•estimates of our expenses, future revenues, capital expenditures, capital requirements and our needs for additional financing;

•our ability to meet our obligations under our campus innovation and headquarters lease (“Campus Lease”), the timing of occupancy and completion of the build-out of our space, cost overruns, delays and the impact of COVID-19 on our space demands;

•our ability to meet our obligations under leases for our corporate offices, manufacturing facilities and warehouses;

•changes in laws and government regulation affecting our business, including the U.S. Food and Drug Administration (“FDA”) and the U.S. Federal Trade Commission (“FTC”) governmental regulation, and state, local and foreign regulation;

•new or pending legislation, or changes in laws, regulations or policies of governmental agencies or regulators, ~~relating to~~both in the U.S. and abroad, affecting plant-based meat, the labeling or naming of our ~~products;~~products, or our brand name or logo;

•the ~~impact~~failure of ~~adverse economic conditions;~~acquisitions and other investments to be efficiently integrated and produce the results we anticipate;

•risks inherent in investment in real estate;

•the financial condition of, and our relationships with our suppliers, co-manufacturers, distributors, retailers, and foodservice ~~customers;~~customers, and their future decisions regarding their relationships with us;

•our ability and the ability of our suppliers and co-manufacturers to comply with food safety, environmental or other laws or regulations;

~~seasonality;~~•seasonality, including increased levels of purchasing by customers ahead of holidays, customer shelf reset activity and the timing of product restocking by our retail customers;

•the sufficiency of our cash and cash equivalents to meet our liquidity needs, and service our ~~indebtedness;~~indebtedness and our ability to access capital markets upon favorable terms, including due to rising interest rates and market volatility;

•economic conditions and ~~their~~the impact on consumer spending;

•the impact of increased scrutiny from stakeholders, institutional investors and governmental bodies on environmental, social and governance (“ESG”) practices, including expanding mandatory and voluntary reporting, diligence and disclosure on ESG matters;

•the outcomes of legal or administrative ~~proceedings;~~proceedings, or new legal or administrative proceedings filed against us;

•our, our suppliers’ and our co-manufacturers’ ability to protect our proprietary technology, ~~and~~ intellectual property and trade secrets adequately;

~~as well as~~•the impact of tariffs and trade wars;

•the impact of changes in tax laws; and

•the risks discussed in Part I, Item 1A, “Risk Factors,” included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 filed with the Securities and Exchange Commission (the “SEC”) on March 2, 2022 (the “2021 10-K”), Part II, Item 1A, “Risk Factors,” included herein, and those discussed in other documents we file from time to time with the SEC.

In some cases, you can identify forward-looking statements ~~regarding our future operations, financial condition and prospects, and business strategies. Forward-looking statements generally can be identified~~ by the use of words such as “believe,” “may,” “will,” “will continue,” “could,” “will likely result,” “estimate,” “continue,” “anticipate,” “intend,” “plan,” “predict,” “project,” “expect,” “potential” and variations of these terms and similar expressions, ~~as they relate to our company, our business and our management.~~or the negative of these terms or similar expressions. These forward-looking statements are based on our current expectations and assumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially from those anticipated or implied in the forward-looking statements. ~~Factors that could cause or contribute~~

This report also contains estimates and other statistical data obtained from independent parties and by us relating to market size and growth and other data about our industry and ultimate consumers. The number of retail and foodservice outlets are derived from data through June 2022. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such ~~differences include, but~~estimates and data.

All forward-looking statements attributable to us or persons acting on our behalf are ~~not limited to, those discussed~~expressly qualified in ~~this Quarterly Report on Form 10-Q, including, without limitation,~~their entirety by the ~~risks discussed in Part II, Item 1A, "Risk Factors," and those discussed in other documents we file from time to time with the Securities and Exchange Commission (“SEC”).~~

cautionary statements set forth above. Forward-looking statements speak only as of the date of this report. You should not put undue reliance on any forward-looking statements. We assume no obligation to publicly update or revise any forward-looking statements ~~to reflect actual results,~~because of new information, future events, changes in assumptions or ~~changes in other factors affecting forward-looking information,~~otherwise, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

~~As used herein, the terms “Beyond~~“Beyond Meat,” ~~“we,” “us,” “our” and “the Company” refer to Beyond Meat, Inc., a Delaware corporation.~~

~~“The Beyond~~“Beyond Burger,” “Beyond Beef,~~” “Beyond Chicken,” “Beyond Meat,~~” “Beyond Sausage,” “Beyond Breakfast Sausage,” ~~“The Cookout Classic”~~“Beyond Meatballs,” “Beyond Chicken,” the Caped Steer Logo, and ~~“The Future of Protein” and “The Future of Protein Beyond Meat” and design~~“Eat What You Love,” are registered or pending trademarks of Beyond Meat, Inc. in the United States and, in some cases, in certain other countries. All other brand names or trademarks appearing in this ~~Quarterly Report on Form 10-Q~~report are the property of their respective holders. Solely for convenience, the trademarks and trade names contained herein are referred to without the ® and TM™ symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto.

~~iii~~

Part I. Financial Information

ITEM I. FINANCIAL ~~STATMENTS~~STATEMENTS

~~BEYOND MEAT, INC.~~

~~Condensed Balance Sheets~~

~~(In thousands, except share and per share data)~~

~~(unaudited)~~


BEYOND MEAT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
(unaudited)
	July 2, 2022		December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	454,674	$	733,294
Accounts receivable, net	77,154		43,806
Inventory	254,653		241,870
Prepaid expenses and other current assets	33,029		33,078

Total current assets	$	819,510	$	1,052,048
Property, plant, and equipment, net	258,075		226,489
Operating lease right-of-use assets	25,464		26,815
Prepaid lease costs, non-current	102,839		59,188
Other non-current assets, net	6,301		6,836
Investment in unconsolidated joint venture	5,920		8,023
Total assets	$	1,218,109	$	1,379,399
Liabilities and Stockholders’ (Deficit) Equity:
Current liabilities:
Accounts payable	$	74,430	$	69,040
Wages payable	2,984		155
Accrued bonus	4,333		128
Current portion of operating lease liabilities	4,595		4,458
Accrued expenses and other current liabilities	22,975		20,226


Short-term finance lease liabilities	210		182

Total current liabilities	$	109,527	$	94,189
Long-term liabilities:

Convertible senior notes, net	$	1,131,641	$	1,129,674

Operating lease liabilities, net of current portion	21,143		22,599
Finance lease obligations and other long-term liabilities	3,739		442
Total long-term liabilities	$	1,156,523	$	1,152,715
Commitments and Contingencies (Note 10)	0		0
(continued on the next page)

March 30,
2019 December 31,
2018
Assets
Current assets:
Cash and cash equivalents $ 35,409
$ 54,271
Accounts receivable 16,194
12,626
Inventory 34,281
30,257
Prepaid expenses and other current assets 6,525
5,672
Total current assets 92,409
102,826
Property, plant, and equipment, net 31,861
30,527
Other non-current assets, net 887
396
Total assets $ 125,157
$ 133,749
Liabilities, Convertible Preferred Stock and Stockholders’ Deficit:
Current liabilities:
Accounts payable $ 11,663
$ 17,247
Wages payable 1,085
1,255
Accrued bonus 3,387
2,312
Accrued expenses and other current liabilities 3,094
2,391
Short-term capital lease liabilities 36
44
Stock warrant liability 2,677
1,918
Total current liabilities $ 21,942
$ 25,167
Long-term liabilities:
Revolving credit line $ 6,000
$ 6,000
Long-term portion of bank term loan, net 19,533
19,388
Equipment loan, net 4,914
5,000
Capital lease obligations and other long-term liabilities 406
404
Total long-term liabilities $ 30,853
$ 30,792
Commitments and Contingencies (Note 9)

March 30,
2019 December 31,
2018
Convertible preferred stock:
Series A convertible preferred stock, par value $0.0001 per share—3,333,500 shares authorized; 3,333,500 shares issued and outstanding as of March 30, 2019 and December 31, 2018 $ 2,000
$ 2,000
Series B convertible preferred stock, par value $0.0001 per share—4,802,260 shares authorized; 4,680,565 shares issued and outstanding as of March 30, 2019 and December 31, 2018 4,999
4,999
Series C convertible preferred stock, par value $0.0001 per share—8,076,643 shares authorized; 8,076,636 shares issued and outstanding as of March 30, 2019 and December 31, 2018 14,882
14,882
Series D convertible preferred stock, par value $0.0001 per share—8,713,207 shares authorized; 8,713,201 shares issued and outstanding as of March 30, 2019 and December 31, 2018 24,948
24,948
Series E convertible preferred stock, par value $0.0001 per share—4,740,531 shares authorized; 4,701,449 shares issued and outstanding as of March 30, 2019 and December 31, 2018 17,214
17,214
Series F convertible preferred stock, par value $0.0001 per share—4,866,776 shares authorized; 4,866,758 shares issued and outstanding as of March 30, 2019 and December 31, 2018 29,840
29,840
Series G convertible preferred stock, par value $0.0001 per share—5,140,257 shares authorized; 5,114,786 shares issued and outstanding as of March 30, 2019 and December 31, 2018 55,658
55,658
Series H convertible preferred stock, par value $0.0001 per share—4,209,693 shares authorized; 2,075,216 shares issued and outstanding as of March 30, 2019 and December 31, 2018 49,999
49,999
Stockholders’ deficit:
Common stock, par value $0.0001 per share—60,000,000 shares and 58,669,600 shares authorized at March 30, 2019 and December 31, 2018, respectively; 7,120,933 and 6,951,350 shares issued and outstanding at March 30, 2019 and December 31, 2018, respectively 1
1
Additional paid-in capital 9,142
7,921
Accumulated deficit (136,321 ) (129,672 )
Total stockholders’ deficit $ (127,178 ) $ (121,750 )
Total liabilities, convertible preferred stock and stockholders’ deficit $ 125,157
$ 133,749


BEYOND MEAT, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
(unaudited)
	July 2, 2022		December 31, 2021
Stockholders’ (deficit) equity:
Preferred stock, par value $0.0001 per share—500,000 shares authorized, none issued and outstanding	$	—	$	—
Common stock, par value $0.0001 per share—500,000,000 shares authorized; 63,643,369 and 63,400,899 shares issued and outstanding at July 2, 2022 and December 31, 2021, respectively	6		6
Additional paid-in capital	530,152		510,014
Accumulated deficit	(574,564)		(376,972)
Accumulated other comprehensive loss	(3,535)		(553)
Total stockholders’ (deficit) equity	$	(47,941)	$	132,495
Total liabilities and stockholders’ (deficit) equity	$	1,218,109	$	1,379,399

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BEYOND MEAT, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(In thousands, except share and per share data)

(unaudited)


	Three Months Ended							Three Months Ended				Six Months Ended
	March 30, 2019			March 31, 2018				July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Net revenues	$	40,206		$	12,776		Net revenues	$	147,040	$	149,426	$	256,495	$	257,590
Cost of goods sold	29,435			10,719			Cost of goods sold	153,202		102,074		262,467		177,530
Gross profit	10,771			2,057
Gross (loss) profit							Gross (loss) profit	(6,162)		47,352		(5,972)		80,060

Research and development expenses	4,498			1,605			Research and development expenses	16,202		13,823		35,880		29,748
Selling, general and administrative expenses	11,177			5,737			Selling, general and administrative expenses	63,015		48,286		138,129		87,240
Restructuring expenses	394			294			Restructuring expenses	4,302		3,844		7,328		6,318
Total operating expenses	16,069			7,636			Total operating expenses	83,519		65,953		181,337		123,306
Loss from operations	(5,298		)	(5,579		)	Loss from operations	(89,681)		(18,601)		(187,309)		(43,246)

Other expense, net:
Other (expense) income, net							Other (expense) income, net
Interest expense	(733		)	(47		)	Interest expense	(1,108)		(1,022)		(2,133)		(1,651)

Other, net	(618		)	(70		)	Other, net	(4,902)		180		(6,026)		(1,390)
Total other expense, net	(1,351		)	(117		)	Total other expense, net	(6,010)		(842)		(8,159)		(3,041)

Loss before taxes	(6,649		)	(5,696		)	Loss before taxes	(95,691)		(19,443)		(195,468)		(46,287)
Income tax expense	—			—			Income tax expense	11		2		21		50
Equity in losses of unconsolidated joint venture							Equity in losses of unconsolidated joint venture	1,432		207		2,103		581
Net loss	$	(6,649	)	$	(5,696	)	Net loss	$	(97,134)	$	(19,652)	$	(197,592)	$	(46,918)
Net loss per common share—basic and diluted	$	(0.95	)	$	(0.98	)
Net loss per share available to common stockholders—basic and diluted							Net loss per share available to common stockholders—basic and diluted	$	(1.53)	$	(0.31)	$	(3.11)	$	(0.74)
Weighted average common shares outstanding—basic and diluted	6,974,301			5,793,801			Weighted average common shares outstanding—basic and diluted	63,573,658		63,121,400		63,519,444		63,029,597

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BEYOND MEAT, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of ~~Convertible Preferred Stock and Stockholders’ Deficit~~Comprehensive Loss

(In ~~thousands, except share data)~~thousands)

(unaudited)

Preferred Stock Common Stock Additional Paid-in Capital Loans to Related Parties Accumulated Deficit Total
Shares Amount Shares Amount
Balance at December 31, 2018 41,562,111
$ 199,540
6,951,350
$ 1
$ 7,921
$ —
$ (129,672 ) $ (121,750 )
  Net loss —
—
—
—
—
—
(6,649 ) (6,649 )
  Exercise of common stock options —
—
169,583
—
366
—
—
366
  Share-based compensation —
—
—
—
855
—
—
855
Balance at March 30, 2019 41,562,111
$ 199,540
7,120,933
$ 1
$ 9,142
$ —
$ (136,321 ) $ (127,178 )

Preferred Stock Common Stock Additional Paid-in Capital Loans to Related Parties Accumulated Deficit Total
Shares Amount Shares Amount
Balance at December 31, 2017 39,361,211
$ 148,194
5,724,506
$ 1
$ 4,823
$ (951 ) $ (99,786 ) (95,913 )
  Net loss —
—
—
—
—
—
(5,696 ) (5,696 )
  Exercise of common stock options —
—
92,310
—
88
—
—
88
  Share-based compensation —
—
—
—
260
—
—
260
  Issuance of Series G preferred stock, net of issuance costs of $7 112,945
1,228
—
—
—
—
—
—
Balance at March 31, 2018 39,474,156
$ 149,422
5,816,816
1
$ 5,171
$ (951 ) $ (105,482 ) $ (101,261 )


	Three Months Ended				Six Months Ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Net loss	$	(97,134)	$	(19,652)	$	(197,592)	$	(46,918)
Other comprehensive (loss) income, net of tax:
Foreign currency translation (loss) income, net of tax	(2,259)		560		(2,982)		(698)
Comprehensive loss, net of tax	$	(99,393)	$	(19,092)	$	(200,574)	$	(47,616)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BEYOND MEAT, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of ~~Cash Flows~~Stockholders’ Equity (Deficit)

(In ~~thousands)~~thousands, except share data)

(unaudited)


	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total
	Shares	Amount
Balance at December 31, 2020	62,820,351	$	6	$	560,210	$	(194,867)	$	1,748	$	367,097
Net loss	—	—		—		(27,266)		—		(27,266)
Issuance of common stock under equity incentive plans, net	188,183	—		2,048		—		—		2,048
Purchase of capped calls related to convertible senior notes	—	—		(83,950)		—		—		(83,950)
Share-based compensation for equity classified awards	—	—		7,376		—		—		7,376
Foreign currency translation adjustment	—	—		—		—		(1,258)		(1,258)
Balance at April 3, 2021	63,008,534	$	6	$	485,684	$	(222,133)	$	490	$	264,047
Net loss	—	—		—		(19,652)		—		(19,652)
Issuance of common stock under equity incentive plans, net	234,964	—		2,663		—		—		2,663
Share-based compensation for equity classified awards	—	—		7,863		—		—		7,863
Foreign currency translation adjustment	—	—		—		—		560		560
Balance at July 3, 2021	63,243,498	$	6	$	496,210	$	(241,785)	$	1,050	$	255,481

Three Months Ended
March 30,
2019 March 31,
2018
Cash flows from operating activities:
Net loss $ (6,649 ) $ (5,696 )
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 1,905
733
Share-based compensation expense 855
260
Amortization of debt issuance costs 58
9
Change in preferred and common stock warrant liabilities 759
129
Net change in operating assets and liabilities:
Accounts receivables (3,568 ) (991 )
Inventories (4,025 ) (1,144 )
Prepaid expenses and other assets 122
60
Accounts payable (4,349 ) 1,845
Accrued expenses and other current liabilities 1,608
(133 )
Long-term liabilities 4
40
Net cash used in operating activities $ (13,280 ) $ (4,888 )
Cash flows used in investing activities:
Purchases of property, plant and equipment $ (3,795 ) $ (3,719 )
Proceeds from sale of fixed assets 132
—
Purchases of property, plant and equipment held for sale (829 ) —
Payment of security deposits (501 ) (13 )
Net cash used in investing activities $ (4,993 ) $ (3,732 )
Cash flows from financing activities:
Proceeds from Series G preferred stock offering, net of offering costs $ —
$ 1,229
Repayments on revolving credit line —
(2,500 )
Repayments on term loan —
(125 )
Payments of capital lease obligations (9 ) (59 )
Proceeds from exercise of stock options 366
87
Payments of deferred offering costs (946 ) —
Net cash used in financing activities $ (589 ) $ (1,368 )
Net decrease in cash and cash equivalents $ (18,862 ) $ (9,988 )
Cash and cash equivalents at the beginning of the period 54,271
39,035
Cash and cash equivalents at the end of the period $ 35,409
$ 29,047
(continued on next page)

Three Months Ended
March 30,
2019 March 31,
2018
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 715
$ 38
Non-cash investing and financing activities:
Non-cash additions to property, plant and equipment $ 589
$ 1,226
Deferred offering costs, accrued not yet paid $ 69
$ —
(concluded)


	Common Stock		Additional Paid-in Capital		Accumulated Deficit			Accumulated Other Comprehensive Loss		Total
		Shares					Amount
Balance at December 31, 2021		63,400,899	$	6	$	510,014		$	(376,972)	$	(553)	$	132,495
Net loss		—	—		—			(100,458)		—		(100,458)
Issuance of common stock under equity incentive plans, net		124,500	—		375			—		—		375
Share-based compensation for equity classified awards		—	—		9,292			—		—		9,292
Foreign currency translation adjustment		—	—		—			—		(723)		(723)
Balance at April 2, 2022		63,525,399	$	6	$	519,681		$	(477,430)	$	(1,276)	$	40,981
Net loss		—	—		—			(97,134)		—		(97,134)
Issuance of common stock under equity incentive plans, net		117,970	—		165			—		—		165
Share-based compensation for equity classified awards		—	—		10,306			—		—		10,306

Foreign currency translation adjustment		—	—		—			—		(2,259)		(2,259)
Balance at July 2, 2022		63,643,369	$	6	$	530,152		$	(574,564)	$	(3,535)	$	(47,941)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.


BEYOND MEAT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
	Six Months Ended
	July 2, 2022		July 3, 2021
Cash flows from operating activities:
Net loss	$	(197,592)	$	(46,918)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	14,820		9,207
Non-cash lease expense	2,091		1,580
Share-based compensation expense	19,598		15,239
Loss on sale of fixed assets	400		111
Amortization of debt issuance costs	1,967		1,352
Loss on extinguishment of debt	—		1,037
Equity in losses of unconsolidated joint venture	2,103		581


Unrealized losses on foreign currency transactions	7,076		—
Net change in operating assets and liabilities:
Accounts receivable	(30,158)		(27,713)
Inventories	(17,036)		(44,741)
Prepaid expenses and other assets	(992)		(9,943)
Accounts payable	(206)		(2,197)
Accrued expenses and other current liabilities	7,949		10,157
Prepaid lease costs, non-current	(43,651)		(26,578)
Operating lease liabilities	(2,059)		(1,619)

Net cash used in operating activities	$	(235,690)	$	(120,445)

Cash flows from investing activities:
Purchases of property, plant and equipment	$	(41,965)	$	(51,420)



Payment of security deposits	(23)		(145)
Net cash used in investing activities	$	(41,988)	$	(51,565)

Cash flows from financing activities:








Proceeds from issuance of convertible senior notes	$	—	$	1,150,000
Purchase of capped calls related to convertible senior notes	—		(83,950)

Debt issuance costs	—		(23,605)

Repayment of revolving credit facility	—		(25,000)








(continued on the next page)


BEYOND MEAT, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
	Six Months Ended
	July 2, 2022		July 3, 2021
Principal payments under finance lease obligations	(43)		(83)

Proceeds from exercise of stock options	1,309		6,499
Payments of minimum withholding taxes on net share settlement of equity awards	(769)		(1,787)



Net cash provided by financing activities	$	497	$	1,022,074
Net (decrease) increase in cash and cash equivalents	$	(277,181)	$	850,064
Effect of exchange rate changes on cash	(1,439)		146
Cash and cash equivalents at the beginning of the period	733,294		159,127
Cash and cash equivalents at the end of the period	$	454,674	$	1,009,337

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	153	$	306
Taxes	$	21	$	98
Non-cash investing and financing activities:




Non-cash additions to property, plant and equipment	$	12,430	$	10,251


Non-cash additions to financing leases	$	115	$	580
Operating lease right-of-use assets obtained in exchange for lease liabilities	$	748	$	1,678
Reclassification of other current liability to additional paid-in capital in connection with the share-settled obligation	$	—	$	1,614

(concluded)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements

Note 1. Introduction

The Company

Beyond Meat, Inc., a Delaware corporation ~~(the~~(including its subsidiaries unless the context otherwise requires, the “Company”), is ~~one of the fastest growing food companies in the United States,~~a leading plant-based meat company offering a portfolio of revolutionary plant-based meats. The Company builds meat directly from plants, an innovation that enables consumers to experience the taste, texture and other sensory attributes of popular animal-based meat products while enjoying the nutritional and environmental benefits of eating the Company’s plant-based meat products. The Company’s brand commitment, “Eat What You Love,” represents a strong belief that ~~by eating~~there is a better way to feed our future and that the ~~Company’s~~positive choices we all make, no matter how small, can have a great impact on our personal health and the health of our planet. By shifting from animal-based meat to plant-based ~~meats, consumers~~protein, we can ~~enjoy more, not less, of their favorite meals, and by doing so, help address concerns related to~~positively impact four growing global issues: human health, climate change, ~~resource conservation~~constraints on natural resources and animal welfare.

The Company’s primary production facilities are located in Columbia, Missouri, and research and development and administrative offices are located in El Segundo, California. In addition to its own production facilities, the Company uses co-manufacturers in various locations in the United States to manufacture its products.

~~The Company sells to a variety~~As of ~~customers in the retail and foodservice channels throughout the United States and internationally through brokers and distributors. All~~July 2, 2022, approximately 85% of the Company’s ~~long-lived~~ assets ~~are~~were located in the United States.

~~Initial Public Offering~~COVID-19 Pandemic

On ~~May 6, 2019,~~March 11, 2020, the World Health Organization declared COVID-19 a pandemic. The global spread and unprecedented impact of COVID-19 continues to create significant volatility, uncertainty and economic disruption. The Company’s operations and its financial results including net revenues, gross profit, gross margin and operating expenses were negatively impacted by COVID-19 in 2020, 2021 and the first half of 2022. The extent of COVID-19’s effect on the Company’s operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic (including any resurgences), the impact of variants of the virus that causes COVID-19, the wide distribution and public acceptance of COVID-19 vaccines, labor needs at the Company ~~completed~~as well as in the supply chain and at customers, compliance with government or employer COVID-19 vaccine mandates and the resulting impact on available labor, and the level of social and economic restrictions imposed in the United States and abroad in an effort to curb the spread of the virus, all of which are uncertain and difficult to predict. As a result, it is not currently possible to ascertain the overall impact of COVID-19 on the Company’s business, results of operations, financial condition or liquidity. While the ultimate health and economic impact of COVID-19 continues to be highly uncertain, the Company expects that the adverse impact of COVID-19 on its ~~initial public offering (“IPO”)~~business and results of ~~common stock,~~operations, including its net revenues, gross profit, gross margin, earnings and cash flows, will continue in ~~which it sold~~ ~~11,068,750~~ ~~shares, including~~ ~~1,443,750~~ ~~shares pursuant~~2022. Future events and effects related to the underwriters’ over-allotment option. The shares began trading on the Nasdaq Global Select Market on May 2, 2019. The shares were sold at an IPO price of $25.00 per share for net proceeds of approximately $252.5 million, after deducting underwriting discountsCOVID-19 pandemic cannot be determined with precision and commissions of $19.4 million and estimated offering expenses of approximately $4.8 million payable by the Company. Upon the closing of the IPO, all outstanding shares of the Company’s convertible preferred stock automatically converted into ~~41,562,111~~ shares of common stock on a one-for-one basis, and warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for a total of 160,767 shares of common stock.actual results could significantly differ from estimates or forecasts.

The accompanying condensed financial statements as of March 30, 2019, including share and per share amounts, do not give effect to the IPO, conversion of the convertible preferred stock, conversion of the convertible preferred stock warrants as of the IPO and such conversions were completed subsequent to March 30, 2019.

Note 2. Summary of Significant Accounting Policies

A detailed description of the Company's significant accounting policies can be found in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on March 2, 2022 (“2021 10-K”). There have been no material changes in the Company’s significant accounting policies from those that were disclosed in the 2021 10-K, except as noted below.

Basis of Presentation

The unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the ~~SEC~~Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in ~~the~~ financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In the opinion of management, the condensed consolidated financial statements include all adjustments necessary, which are of a normal and recurring nature, for the fair presentation of the Company’s financial

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

position and of the results of operations and cash flows for the periods presented. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2022 or for any other interim period or for any other future fiscal year. These condensed consolidated financial statements should be read in conjunction with the Company's audited financial statements and notes thereto included in the prospectus dated May 1, 2019 (the “Prospectus”) that forms a part of the Company's Registration Statement on Form S-1 (File No. 333-228453), as filed with the SEC pursuant to Rule 424 promulgated under the Securities Act of 1933, as amended, on May 3, 2019.2021 10-K. The condensed consolidated balance sheet as of December 31, ~~2018~~2021 has been derived from the audited financial statements at that date. ~~There~~

Principles of Consolidation

The unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been ~~no material changes in the~~

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

~~Company’s significant accounting policies from those that were disclosed in the Prospectus, except as noted below.~~

~~Fiscal Year~~

The Company operates on a fiscal calendar year, and each interim quarter is comprised of one 5-week period and two 4-week periods, with each week ending on a Saturday. The Company’s fiscal year always begins on January 1 and ends on December 31. As a result, the Company’s first and fourth fiscal quarters may have more or fewer days included than a traditional 91-day fiscal quarter.eliminated.

Management’s Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant accounting estimates made by the Company include trade promotion accruals; useful lives of property, plant and equipment; valuation of deferred tax assets; valuation of inventory; incremental borrowing rate used to determine operating lease right-of-use assets and operating lease liabilities; assessment of contract-based factors, asset-based factors, entity-based factors and market-based factors to determine the lease term impacting right-of-use assets and lease liabilities; the valuation of the fair value of ~~common~~ stock ~~and preferred stock~~options used to determine ~~stock~~share-based compensation ~~expense~~expense; and loss contingency accruals in ~~the re-measurement of warrants~~connection with claims, lawsuits and ~~liabilities.~~administrative proceedings. These estimates and assumptions are based on current facts, historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the recording of expenses that are not readily apparent from other sources. Actual results could differ from those estimates and such differences may be material to the condensed consolidated financial statements.

~~Reverse Stock Split~~Foreign Currency

~~On January~~Foreign currency translation (loss) income, net of tax, reported as cumulative translation adjustment through “Other comprehensive loss” was $(2.3) million and $0.6 million for the three months ended July 2, ~~2019,~~2022 and July 3, 2021, respectively.

Foreign currency translation loss, net of tax, reported as cumulative translation adjustments through “Other comprehensive loss” was $(3.0) million and $(0.7) million for the ~~Company effected a 3-to-2 reverse stock split of its outstanding common stock~~six months ended July 2, 2022 and ~~convertible preferred stock, including outstanding stock options~~July 3, 2021, respectively.

Realized and ~~common~~unrealized foreign currency transaction losses included in “Other, net” were $(5.5) million and ~~convertible preferred stock warrants. The reverse stock split did not result in an adjustment to par value. All references~~$(6.6) million in the ~~accompanying condensed financial statements~~three and ~~related notes to the number of shares of common stock, convertible preferred stock, warrants~~six months ended July 2, 2022, respectively. Realized and ~~options to purchase common stock~~unrealized foreign currency transaction gains (losses) included in “Other, net” were $0.2 million and ~~per share data reflect the effect of the reverse stock split.~~

~~Cash and Cash Equivalents~~

~~The Company maintains cash balances at one financial institution~~$(0.1) million in the United States. The cash balances may, at times, exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation or FDIC up to $250,000. The Company considers all highly liquid investments with original maturity dates of 90 days or less to be cash equivalents. Cash equivalents consist primarily of amounts invested in money market accounts.

~~Deferred Offering Costs~~

~~Offering costs, consisting primarily of legal, accounting, printing~~three and filing services, and other direct fees and costs related to the IPO, are capitalized. As of March 30, 2019 and December 31, 2018, $3.4 million and $3.2 million of offering costs, respectively, have been capitalized and recorded in prepaid expenses and other current assets in the accompanying condensed balance sheets.

~~Stock Warrant Liability~~

The Company accounts for freestanding warrants to purchase shares of its convertible preferred stock or common stock as a liability, as the underlying shares of convertible preferred stock and common stock are contingently redeemable and, therefore, may obligate the Company to transfer assets at some point in the future. The warrants were recorded at fair value upon issuance and are subject to re-measurement at each balance sheet date. Any change in fair value is recognized in the condensed statements of operations in other expense.

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

As of March 30, 2019, the Company had outstanding warrants to purchase an aggregate of 60,002 shares of its common stock at an exercise price of $3.00 per share, 121,694 shares of its Series B convertible preferred stock at an exercise price of $1.07 per share and 39,073 shares of its Series E convertible preferred stock at an exercise price of $3.68 per share. On May 6, 2019, upon the closing of the IPO, the warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for a total of 160,767 shares of common stock at the same respective exercise price per share. Subsequent to the closing of the IPO, all outstanding warrants to purchase shares of common stock were exercised.six months ended July 3, 2021, respectively.

Fair Value of Financial Instruments

The ~~fair value measurement accounting guidance creates a fair value hierarchy to prioritize the inputs used to measure fair value into three categories. A~~Company had no financial ~~instrument’s level within the fair value hierarchy is based on the lowest level of input significant to the fair value measurement, where Level 1 is the highest and Level 3 is the lowest.~~

~~The three levels are defined as follows:~~

~~Level 1~~—Unadjusted quoted prices in active markets accessible by the reporting entity for identical assets or liabilities. Active markets are those in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

~~Level 2—Quoted prices for similar~~ instruments ~~in active markets; quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which significant value drivers are observable.~~

~~Level 3—Valuations derived from valuation techniques in which significant value drivers are unobservable.~~

The Company’s financial instruments include cash equivalents, accounts receivable, accounts payable, and accrued expenses, for which the carrying amounts approximate fair value due to the short-term maturity of these financial instruments. Based on the borrowing rates currently available to the Company for debt with similar terms, the carrying value of the line of credit, term debt with its bank, and equipment loan approximate fair value as well.

~~The following table sets forth the Company’s financial instruments that were~~ measured at fair value on a recurring basis ~~based on the fair value hierarchy (in thousands):~~

March 30, 2019
Level 1 Level 2 Level 3 Total
Financial Liabilities:
Preferred stock warrant liability $ —
$ —
$ 1,998
$ 1,998
Common stock warrant liability —
—
679
679
Total $ —
$ —
$ 2,677
$ 2,677

December 31, 2018
Level 1 Level 2 Level 3 Total
Financial Liabilities:
Preferred stock warrant liability $ —
$ —
$ 1,441
$ 1,441
Common stock warrant liability —
—
477
477
Total $ —
$ —
$ 1,918
$ 1,918

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

as of July 2, 2022 and December 31, 2021.

There were no transfers of financial assets or liabilities ~~between~~into or out of Level 1, Level 2 or Level 3 infor the three and six months ended March 30, 2019 or March 31, 2018. The key assumptions used in the Black-Scholes option-pricing model for the valuation of the preferred stock warrant liability and common stock warrant liability upon re-measurement were as follows:

For the Three Months Ended
March 30,
2019 March 31,
2018
Expected term (in years) 2.0
3.0
Fair value of underlying shares $ 19.49
$ 3.00
Volatility 55.0 % 55.0 %
Risk-free interest rate 2.27 % 1.98 %
Dividend yield —
—

Generally, increases or decreases in the fair value of the underlying convertible preferred stock and common stock would result in a directionally similar impact in the fair value measurement of the associated warrant liability.

~~The following table sets forth a summary of the changes in the fair value of the preferred and common stock warrant liabilities:~~

For the Three Months Ended
(in thousands) March 30, 2019 March 31, 2018
Beginning balance $ 1,918
$ 550
Change in fair value of warrant liability 759
129
Ending balance $ 2,677
$ 679
July 2, 2022.

Revenue Recognition

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (ASU) No. 2014-09, “Revenue from Contracts with Customers” (“ASU 2014-09”), which, along with subsequent ASUs, amends the existing accounting standards for revenue recognition (“Topic 606”). This guidance is based on principles that govern the recognition of revenue at an amount an entity expects to be entitled to receive when products are transferred to customers. ASU 2014-09 was effective for the Company beginning January 1, 2019. The majority of the Company’s contracts with customers generally consist of a single performance obligation to transfer promised goods. Based on the Company’s evaluation process and review of its contracts with customers, the timing and amount of revenue recognized based on ASU 2014-09 is consistent with the Company’s revenue recognition policy under previous guidance. The Company has therefore concluded that the adoption of ASU 2014-09 did not have a material impact on its financial position, results of operations, or cash flows.

Revenue is recognized at the point in which the performance obligation under the terms of a contract with the customer have been satisfied and control has transferred. The Company’s performance obligation is typically defined as the accepted purchase order, or the contract, with the customer which requires the Company to deliver the requested products at agreed upon prices at the time and location of the customer’s choice. The Company does not offer warranties or a right to return on the products it sells except in the instance of a product recall.

Revenue is measured as the amount of consideration the Company expects to receive in exchange for fulfilling the performance obligation. Sales and other taxes the Company collects concurrent with the sale of products are excluded from revenue. The Company's normal payment terms vary by the type and location of its customers and the products offered. The time between invoicing and when payment is due

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

~~is not significant. None of the Company's contracts as of March 30, 2019 contain a significant financing component.~~

The Company routinely offers sales discounts and promotions through various programs to its customers and consumers. These programs include rebates, temporary on shelf price reductions, off invoice discounts, retailer advertisements, and other trade activities. Provision for discounts and incentives are recorded in the same period in which the related revenues are recognized. At the end of each accounting period, the Company recognizes a ~~liability~~contra asset to accounts receivable for estimated sales discounts that have been incurred but not paid which totaled ~~$0.9~~$5.2 million and ~~$0.8~~

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

$3.6 million as of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018,~~2021, respectively. The offsetting charge is recorded as a reduction of revenues in the same period when the expense is incurred.

~~The Company recognizes the incremental costs~~Presentation of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. The incremental cost to obtain contracts was not material.Net Revenues by Channel

The following table presents the Company’s net revenues by ~~platform and channel are included in the tables below:~~channel:

For the Three Months Ended
(in thousands) March 30, 2019 March 31, 2018
Net revenues:
Fresh Platform $ 38,806
$ 9,596
Frozen Platform 4,512
4,748
Less: Discounts (3,112 ) (1,568 )
Net revenues $ 40,206
$ 12,776


	For the Three Months Ended					Three Months Ended				Six Months Ended
(in thousands)	March 30, 2019		March 31, 2018		(in thousands)	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Net revenues:					Net revenues:
U.S.:					U.S.:
Retail	$	19,579	$	9,288	Retail	$	78,861	$	77,195	$	147,121	$	141,021
Restaurant and Foodservice	20,627		3,488
Foodservice					Foodservice	23,389		23,961		38,882		40,703
U.S. net revenues					U.S. net revenues	102,250		101,156		186,003		181,724
International:					International:
Retail					Retail	23,692		28,544		39,829		45,743
Foodservice					Foodservice	21,098		19,726		30,663		30,123
International net revenues					International net revenues	44,790		48,270		70,492		75,866
Net revenues	$	40,206	$	12,776	Net revenues	$	147,040	$	149,426	$	256,495	$	257,590

Two ~~distributors each accounted for approximately 21% of the Company’s gross revenues in the three months ended March 30, 2019; and three~~ distributors accounted for approximately ~~34%, 14%~~16% and ~~11%~~10%, respectively, of the Company’s gross revenues in the three months ended ~~March 31, 2018, which were primarily related to sales in the United States~~July 2, 2022 and ~~Canada. Approximately 14%~~one distributor accounted for approximately 10% of the Company’s ~~net~~gross revenues in the three months ended ~~March 30, 2019 was from international sales excluding sales~~July 3, 2021. One distributor accounted for approximately 13% of the Company’s gross revenues in ~~Canada. International sales~~the six months ended July 2, 2022 and one customer accounted for approximately 10% of the Company’s gross revenues in the six months ended July 3, 2021. No other distributor or customer accounted for more than 10% of the Company’s gross revenues in the three and six months ended ~~March 31, 2018 were immaterial.~~July 2, 2022 and July 3, 2021.

Investment in Joint Venture

The Company uses the equity method of accounting to record transactions associated with its joint venture when the Company shares in joint control of the investee. Investment in joint venture is not consolidated but is recorded in “Investment in unconsolidated joint venture” in the Company’s condensed consolidated balance sheets. The Company recognizes its portion of the investee’s results in “Equity in losses of unconsolidated joint venture” in its condensed consolidated statements of operations. The Company eliminates its proportionate interest in any intra-entity profits or losses in the inventory of the investee at the end of the reporting period and recognizes its portion of the profit and losses when realized by the investee.

Shipping and Handling Costs

Outbound shipping and handling costs included in selling, general and administrative (“SG&A”) expenses in the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018~~July 3, 2021 were ~~$1.3~~$4.2 million and ~~$1.1~~$4.9 million, respectively.

~~Related-Party Transactions~~

~~The Company entered into a consulting agreement with Seth Goldman, the Company’s Executive Chair, on March 2, 2016, which was amended~~ Outbound shipping and ~~restated on November 15, 2018 and further amended~~

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

on April 8, 2019. Pursuant to the consulting agreement, the Company will pay Mr. Goldman $20,210.33 per month for services rendered under the consulting agreement and, on the date of each annual meeting of the Company’s stockholders after which Mr. Goldman’s non-employee service on the board of directors will continue, the Company has agreed to grant Mr. Goldman a restricted stock unit award under the 2018 Equity Incentive Plan (the “Plan”), having a grant date fair value of $105,000. Each restricted stock unit grant will vest based on continued servicehandling costs included in ~~equal monthly installments over the 12-month period following the grant date, provided it will vest in full immediately prior to, and contingent upon, a change in control of the company.~~

~~The consulting agreement may be terminated by either party at any time upon 120 business days’ written notice. In the event of a default~~SG&A expenses in the performance of the consulting agreement or material breach of any obligations under the consulting agreement, the non-breaching party may terminate the consulting agreement immediately if the breaching party fails to cure the breach within 30 business days after having received written notice by the non-breaching party of the default or breach.

~~Bernhard van Lengerich~~

The Company first entered into an advisor agreement with Food System Strategies, LLC in October 2015. Bernhard van Lengerich. Ph.D., a member of the Company’s Board of Directors, is the Chief Executive Officer of Food System Strategies, LLC. Pursuant to this advisor agreement, the Company paid Food System Strategies, LLC $4,000 for each day Dr. van Lengerich provided services, provided the Company paid Food System Strategies, LLC for at least two days of services per month. In February 2016, the Company entered into a new advisor agreement with Food System Strategies, LLC, which superseded the original agreement and provided for a $25,000 monthly retainer and a non-qualified stock option covering 798,848 shares, which vested in equal monthly installments over three years in consideration of Dr. van Lengerich providing services as the Company’s interim Chief Technical Officer and head of research and development, and the increased time commitment associated with these roles. In December 2016, the advisor agreement was amended to provide for a $10,000 monthly retainer to reflect the fact that Dr. van Lengerich would only be providing advisory services five to six ~~days a month going forward. The advisor agreement may be terminated at any time upon written notice to the other party.~~

~~In the three~~ months ended March 31, 2018, the Company incurred consulting costs payable to a company associated with Donald Thompson, a member of the Company’s Board of Directors, in the amount of $47,162. The Company did not incur any such consulting costs in the three months ended March 30, 2019.July 2, 2022 and July 3, 2021 were $10.1 million and $8.2 million, respectively.

Recently Adopted Accounting Pronouncements

In June 2018, the FASB issued ASU No. 2018-07, “Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). Under ASU 2018-07, the measurement of equity-classified nonemployee awards will be fixed at the grant date, and nonpublic entities are allowed to account for nonemployee awards using certain practical expedients that are already available for employee awards. The amendments in ASU 2018-07 are effective for nonpublic business entities for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December 15, 2020. Early adoption is permitted, but no earlier than the Company’s adoption date of Topic 606. The Company early adopted ASU 2018-07 beginning January 1, 2019 along with its adoption of ASU 2014-09. Pursuant to ASU 2018-07, the measurement of equity classified nonemployee awards will be fixed at the grant date, as compared to the previous requirement to remeasure the awards through the performance completion date.None.

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

~~New Accounting Pronouncements~~

As an “emerging growth company,” the Jumpstart Our Business Startups Act, or the JOBS Act, allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use the adoption dates applicable to private companies. As a result, the Company’s financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective date for new or revised accounting standards that are applicable to public companies.

In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”), which makes amendments to the guidance in GAAP on the classification and measurement of financial instruments. ASU 2016-01 significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. It also amends certain disclosure requirements associated with the fair value of financial instruments. For all entities other than public entities, ASU 2016-01 is effective for fiscal years beginning after December 15, 2018, including interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted. The Company expects to adopt and implement ASU 2016-01 for the year ending December 31, 2019 and for interim periods beginning January 1, 2020. The Company does not expect that adoption of ASU 2016-01 will have a material impact on the Company’s financial position, results of operations, or cash flows.

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 requires lessees to generally recognize most operating leases on the balance sheets but record expenses on the income statements in a manner similar to current accounting. ASU 2016-02 along with subsequent ASU’s on Topic 842 is effective for nonpublic companies for the annual reporting period beginning after December 15, 2019, and, therefore, effective for the Company beginning January 1, 2020. Early application is permitted. The Company is currently evaluating the impact ASU 2016-02 will have on its financial statements and currently expects that most operating lease commitments will be subject to ASU 2016-02 and will be recognized as operating lease liabilities and right-of-use assets upon adoption. While the Company has not yet quantified the impact, adjustments resulting from the adoption of ASU 2016-02 will materially increase total assets and total liabilities relative to such amounts reported prior to adoption.

Note 3. Restructuring

In May 2017, management approved a plan to terminate the Company’s exclusive supply agreement (the “Agreement”) with one of its co-manufacturers, due to non-performance under the Agreement and on

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

May 23, 2017, the Company notified the co-manufacturer of its decision to terminate the Agreement. In the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018,~~July 3, 2021, the Company recorded ~~$0.4~~$4.3 million and ~~$0.3~~$3.8 million, respectively, in restructuring expenses related to this dispute, which consisted primarily of legal and other expenses. In the six months ended July 2, 2022 and July 3, 2021, the Company recorded $7.3 million and $6.3 million, respectively, in restructuring expenses related to this dispute, which consisted primarily of legal and other expenses. See Note 910 for further information. As of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018, there were no~~2021, the Company had $2.2 million and $2.7 million, respectively, in accrued and unpaid ~~liabilities~~restructuring expenses.

Leases are classified as either finance leases or operating leases based on criteria in Accounting Standards Codification 842. The Company has operating leases for its corporate offices, including its Manhattan Beach Project Innovation Center where the Company’s research and development facility is located, its manufacturing facilities, commercialization center, warehouses and vehicles, and to a lesser extent, certain equipment and finance leases. Such leases generally have original lease terms between two and 12 years, and often include 1 or more options to renew. Some leases also include early termination options, which can be exercised under specific conditions. The Company includes options to extend the lease term if the options are reasonably certain of being exercised. The Company currently considers its renewal options to be reasonably certain to be exercised. The Company does not have residual value guarantees or material restrictive covenants associated with ~~this contract termination.~~its leases.

On January 14, 2021, the Company entered into the Campus Lease, a 12-year lease with 2 5-year renewal options to house its corporate headquarters, lab and innovation space in El Segundo, California. The Company has not recognized an asset or a liability for the Campus Lease in its consolidated balance sheet as of July 2, 2022 because there was no lease commencement during the three months ended July 2, 2022. Therefore, the Campus Lease is not included in the tables below.

Lease costs for operating and finance leases were as follows:


		Three Months Ended
(in thousands)	Statement of Operations Location	July 2, 2022		July 3, 2021
Operating lease cost:
Lease cost	Cost of goods sold	$	151	$	556
Lease cost	Research and development expenses	551		191
Lease cost	Selling, general and administrative expenses	860		148
Variable lease cost(1)	Cost of goods sold	9		1
Operating lease cost		$	1,571	$	896

Short-term lease cost	Selling, general and administrative expenses	$	152	$	87

Finance lease cost:
Amortization of right-of use assets	Cost of goods sold	$	45	$	47
Interest on lease liabilities	Interest expense	(12)		5
Finance lease cost		$	33	$	52

Total lease cost(2)		$	1,756	$	1,035

(1) Variable lease cost primarily consists of common area maintenance, such as cleaning and repairs.

(2) Excludes Campus Lease. See Note 10.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)


		Six Months Ended
(in thousands)	Statement of Operations Location	July 2, 2022		July 3, 2021
Operating lease cost:
Lease cost	Cost of goods sold	$	762	$	1,095
Lease cost	Research and development expenses	1,065		339
Lease cost	Selling, general and administrative expenses	1,863		345
Variable lease cost(1)	Cost of goods sold	162		29
Operating lease cost		$	3,852	$	1,808

Short-term lease cost	Selling, general and administrative expenses	$	299	$	113

Finance lease cost:
Amortization of right-of use assets	Cost of goods sold	$	90	$	84
Interest on lease liabilities	Interest expense	12		10
Finance lease cost		$	102	$	94

Total lease cost(2)		$	4,253	$	2,015

(1) Variable lease cost primarily consists of common area maintenance, such as cleaning and repairs.

(2) Excludes Campus Lease. See Note 10.

Supplemental balance sheet information as of July 2, 2022 and December 31, 2021 related to leases are as follows:


(in thousands)	Balance Sheet Location	July 2, 2022		December 31, 2021
Assets(1)
Operating leases	Operating lease right-of-use assets	$	25,464	$	26,815
Finance leases, net	Property, plant and equipment, net	687		615
Total lease assets		$	26,151	$	27,430

Liabilities(1)
Current:
Operating lease liabilities	Current portion of operating lease liabilities	$	4,595	$	4,458
Finance lease liabilities	Short-term finance lease liabilities	210		182
Long-term:
Operating lease liabilities	Operating lease liabilities, net of current portion	21,143		22,599
Finance lease liabilities	Finance lease obligations and other long-term liabilities	485		442
Total lease liabilities		$	26,433	$	27,681

(1) Excludes Campus Lease. See Note 10.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

The following is a schedule by year of the maturities of lease liabilities with original terms in excess of one year, as of July 2, 2022:

(1) Excludes Campus Lease. See Note 10.

Weighted average remaining lease terms and weighted average discount rates were:

(1) Excludes Campus Lease. See Note 10.

Note 4.5. Inventories

Major classes of inventory were as follows:


(in thousands)	July 2, 2022		December 31, 2021
Raw materials and packaging	$	135,937	$	129,974
Work in process	54,678		50,227
Finished goods	64,038		61,669
Total	$	254,653	$	241,870

March 31, December 31,
(in thousands) 2019 2018
Raw materials and packaging $ 16,385
$ 13,756
Work in process 6,198
2,517
Finished goods 11,698
13,984
Total $ 34,281
$ 30,257

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

Note 5.6. Property, Plant and Equipment

Property, plant, and equipment are stated at cost and ~~capital~~finance lease assets are included. A summary of property, plant, and equipment as of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018,~~2021, is as follows:

Depreciation and amortization expense for the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018,~~July 3, 2021 was ~~$1.9~~$7.7 million and ~~$0.7~~$4.9 million, respectively. Of the total depreciation and amortization expense in the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018, $1.4~~July 3, 2021, $6.6 million and ~~$0.6~~$3.9 million, respectively, were recorded in cost of goods ~~sold and $0.5~~sold; $1.0 million and ~~$0.1~~$0.9 million, respectively, were recorded in research and development expenses; and $0.1 million and $30,000, respectively, were recorded in SG&A expenses in the Company’s condensed consolidated statements of operations.

Depreciation and amortization expense for the six months ended July 2, 2022 and July 3, 2021 was $14.8 million and $9.2 million, respectively. Of the total depreciation and amortization expense in the six months ended July 2, 2022 and July 3, 2021, $12.5 million and $7.4 million, respectively, were recorded in cost of goods sold; $2.0 million and $1.8 million, respectively, were recorded in research and development expenses; and $0.3 million and $60,000, respectively, were recorded in SG&A expenses in the Company’s condensed consolidated statements of operations.

The Company ~~has $1.9 million and $1.0 million in~~concluded that no property, plant and equipment ~~concluded to meet~~met the criteria for assets held for sale ~~and are included in prepaid expenses and other current assets on the condensed balance sheets~~ as of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018, respectively. The Company expects to sell such~~2021. Previous amounts classified as assets ~~in 2019~~held for sale were sold for amounts that ~~approximate~~approximated book ~~value.~~value for which a note receivable of $3.8 million, net of payments received, had been recorded. The note receivable is included in “Other non-current assets, net” in the Company’s condensed consolidated balance sheet at July 2, 2022 and December 31, 2021.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

The ~~Company’s~~following is a summary of debt balances ~~are detailed below:~~as of July 2, 2022 and December 31, 2021:


(in thousands)	July 2, 2022		December 31, 2021
Convertible senior notes	$	1,150,000	$	1,150,000




Debt issuance costs	(18,359)		(20,326)


Convertible senior notes, net	$	1,131,641	$	1,129,674

(in thousands) March 30, 2019 December 31, 2018
2018 Revolving Credit Facility (defined below) $ 6,000
$ 6,000
2018 Term Loan Facility (defined below) 20,000
20,000
Equipment financing loan 5,000
5,000
Debt issuance costs (553 ) (612 )
Total debt outstanding $ 30,447
$ 30,388
Less: current portion of long-term debt —
—
Long-term debt $ 30,447
$ 30,388
Convertible Senior Notes

On March 5, 2021, the Company issued $1.0 billion aggregate principal amount of its 0% Convertible Senior Notes due 2027 (the “Convertible Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. On March 12, 2021, the initial purchasers of the Convertible Notes exercised their option to purchase an additional $150.0 million aggregate principal amount of the Company’s 0% Convertible Senior Notes due 2027 (the “Additional Notes”, and together with the Convertible Notes, the “Notes”), and such Additional Notes were issued on March 16, 2021.

The ~~Company records~~total amount of debt issuance costs of $23.6 million was recorded as a reduction ~~of carrying value of the debt~~to “Convertible senior notes, net” in the ~~accompanying~~ condensed consolidated balance ~~sheets. Debt issuance costs, net of amortization, totaled $0.6 million as of March 30, 2019~~sheet and ~~December 31, 2018. Debt issuance costs~~ are being amortized as interest expense over the term of the ~~loan for which amortization of $58,000 and $9,000 was recorded during~~Notes using the effective interest method. During the three and six months ended ~~March 30, 2019 and March 31, 2018, respectively.~~

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

~~Amended and Restated Loan and Security Agreement~~

~~In June 2018,~~July 2, 2022, the Company refinanced its then existing revolving credit facility and term loan facility under a loan and security agreement with Silicon Valley Bank (“SVB”) (the “Amended LSA”). The Amended LSA includes a $6.0 million revolving credit facility (the “2018 Revolving Credit Facility”) and a term loan facility (the “2018 Term Loan Facility”) comprised of (i) a $10.0 million term loan advance at closing, (ii) a conditional $5.0 million term loan advance, if no event of default has occurred and is continuing through the borrowing date, and (iii) an additional conditional term loan advance of $5.0 million if no event of default has occurred and is continuing based upon a minimum level of gross profit for the trailing 12-month period. The 2018 Term Loan Facility has a floating interest rate that is equal to 4.0% above the prime rate, with interest payable monthly and principal amortizing commencing on January 1, 2020, and will mature in June 2022. Borrowings under the 2018 Revolving Credit Facility carry a variable annual interest rate of prime rate plus 0.75% to 1.25% with an additional 5% on the outstanding balances in the event of a default. The 2018 Revolving Credit Facility matures in June 2020.

The 2018 Term Loan Facility and the 2018 Revolving Credit Facility (the “SVB Credit Facilities,”) contain customary negative covenants that limit the Company’s ability to, among other things, incur additional indebtedness, grant liens, make investments, repurchase stock, pay dividends, transfer assets and merge or consolidate. The SVB Credit Facilities are secured by a blanket lien on all of the Company’s personal property assets. The SVB Credit Facilities also contain customary affirmative covenants, including delivery of audited financial statements. The Company was in compliance with the covenants in the SVB Credit Facilities as of March 30, 2019.

~~As of March 30, 2019 and December 31, 2018, the Company had $6.0~~recognized $1.0 million and ~~$20.0~~$2.0 million, in borrowings on the 2018 Revolving Credit Facility and 2018 Term Loan Facility, respectively, and had no availability to borrow under either of these loan facilities. In the three months ended March 30, 2019 and March 30, 2018, the Company incurred $0.6 million and $18,000 in interest expense related to the SVB credit facilities. The interest rates on the 2018 Revolving Credit Facility and the 2018 Term Loan Facility at March 30, 2019 were 6.25% and 9.50%, respectively.

~~Equipment Loan Facility~~

The Company had $5.0 million in borrowings outstanding as of March 30, 2019 and December 31, 2018 under the equipment loan facility. The interest rate on the equipment loan facility at March 30, 2019 and December 31, 2018 was 11.75% and 11.5%, respectively. For the three months ended March 30, 2019 and March 31, 2018, the Company recorded $0.1 million and $0, respectively, in interest expense related to the amortization of the debt issuance costs related to the Notes. During the three and six months ended July 3, 2021, the Company recognized $1.0 million and $1.3 million, respectively, in interest expense related to the amortization of the debt issuance costs related to the Notes.

The following is a summary of the Company’s Notes as of July 2, 2022:

(in thousands)

Principal Amount

Unamortized Issuance Costs

Net Carrying Amount

Fair Value

Amount

Leveling

0% Convertible senior notes due on March 15, 2027

$1,150,000

$18,359

$1,131,641

$419,750

Level 2

The Notes are carried at face value less the unamortized debt issuance costs on the Company’s condensed consolidated balance sheets. As of July 2, 2022, the estimated fair value of the Notes was approximately $0.4 billion. The Notes are quoted on the Intercontinental Exchange and are classified as Level 2 financial instruments. The estimated fair value of the Notes was determined based on the actual bid price of the Notes on June 30, 2022, the last trade day of the period.

As of July 2, 2022, the remaining life of the Notes is approximately 4.7 years.

Revolving Credit Facility

On March 2, 2021, the Company terminated its secured revolving credit agreement, dated as of April 21, 2020 (the “Credit Agreement”).

The Company recorded debt issuance costs on the revolving credit facility in “Prepaid and other non-current assets, net” in the accompanying condensed consolidated balance sheet. Debt issuance costs associated with the revolving credit facility were amortized as interest expense over the term of the loan. In the three and six months ended July 3, 2021, debt issuance costs of $0 and $41,000, respectively, related to the Company’s prior revolving credit facility and equipment loan ~~facility.~~were amortized to interest expense.

~~Warrant Liabilities~~

In connection with its financing arrangements, the Company has issued warrants to purchase shares of its convertible preferred stock. For one of the financing arrangements, the Company issued warrants to purchase 121,694 shares of Series B convertible preferred stock at an exercise price of $1.07 per share. For a separate financing arrangement, the Company issued warrants to purchase 39,073 shares of Series E convertible preferred stock at an exercise price of $3.68 per share. In connection with the Company’s refinancing of its credit facilities with SVB, the Company issued to SVB and its affiliates warrants to purchase an aggregate of 60,002 shares of its common stock at an exercise price of $3.00 per share. The warrants remained outstanding as of March 30, 2019 and December 31, 2018. On May 6, 2019, upon the closing of the IPO, the warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for a total of 160,767 shares of common stock at the same respective exercise price per share. Subsequent to the closing of the IPO, all outstanding warrants to purchase shares of common stock were exercised. See ~~Note 2~~ ~~for further information on the warrant liabilities.~~

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

In the three months ended July 2, 2022 and July 3, 2021, the Company incurred $0 in interest expense related to its bank credit facilities. In the six months ended July 2, 2022 and July 3, 2021, the Company incurred $0 and $0.3 million, respectively, in interest expense related to its bank credit facilities.

Upon termination of the revolving credit facility, unamortized debt issuance costs of $1.0 million associated with the revolving credit facility were written off as “Loss on extinguishment of debt,” which is included in “Other, net” in the condensed consolidated statement of operations for the six months ended July 3, 2021.

Concurrent with the Company’s execution of the Campus Lease, as a security deposit, the Company delivered to the landlord a letter of credit under the revolving credit facility in the amount of $12.5 million. Upon termination of the revolving credit facility, the letter of credit continued in effect, unsecured.

Note 7.8. Stockholders’ ~~Deficit and Convertible Preferred Stock~~Equity

As of ~~March 30, 2019,~~July 2, 2022, the Company’s shares consisted of ~~60,000,000~~500,000,000 authorized shares of common stock, par value $0.0001 per share, of which ~~7,120,933~~63,643,369 shares of common stock were issued and outstanding, and ~~43,882,867~~500,000 authorized shares of preferred stock, par value $0.0001 per share, of which ~~3,333,500~~no shares of Series A Preferred Stock, 4,680,565 shares of Series B Preferred Stock, 8,076,636 shares of Series C Preferred Stock, 8,713,201 shares of Series D Preferred Stock, 4,701,449 shares of Series E Preferred Stock, 4,866,758 shares of Series F Preferred Stock, 5,114,786 shares of Series G Preferred Stock and 2,075,216 shares of Series H Preferred Stock were issued and outstanding.

Upon the closing of the IPO, all outstanding shares of the Company’s convertible preferred stock automatically converted into 41,562,111 shares of common stock on a one-for-one basis. On May 6, 2019, the Company filed an Amended and Restated Certificate of Incorporation authorizing the Company to issue 500,000,000 shares of common stock, $0.0001 par value per share, and 500,000 shares of undesignated preferred stock, $0.0001 par value per share with rights and preferences determined by the Company’s Board of Directors at the time of issuance of such shares.

As of December 31, ~~2018,~~2021, the Company’s shares consisted of ~~58,669,600~~500,000,000 authorized shares of common stock, par value $0.0001 per share, of which ~~6,951,350~~63,400,899 shares were issued and outstanding, and ~~43,882,867~~500,000 authorized shares of preferred stock, par value $0.0001 per share, of which ~~3,333,500~~no shares of Series A Preferred Stock, 4,680,565 shares of Series B Preferred Stock, 8,076,636 shares of Series C Preferred Stock, 8,713,201 shares of Series D Preferred Stock, 4,701,449 shares of Series E Preferred Stock, 4,866,758 shares of Series F Preferred Stock, 5,114,786 shares of Series G Preferred Stock and 2,075,216 shares of Series H Preferred Stock were issued and outstanding.

The Company has not declared or paid any dividends, or authorized or made any distribution upon or with respect to any class or series of its capital stock.

Note 8.9. Share-Based Compensation

~~On April 11, 2011,~~In 2019, the Company’s ~~stockholders approved the~~ 2011 Equity Incentive Plan (“2011 Plan”), and most recently amended the 2011 Plan on April 10, 2019. The 2011 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock and restricted stock unit awards to eligible participants. Eligible participants are employees, directors and consultants. As of March 30, 2019, there were 9,462,455 shares of common stock authorized for issuance under the 2011 Plan.

~~The 2011 Plan~~ was amended, restated and re-named the 2018 Equity Incentive Plan ~~(“2018~~(the “2018 Plan”), ~~which became effective as of April 30, 2019,~~and the ~~day prior~~remaining shares available for issuance under the 2011 Plan were added to the ~~effectiveness~~shares reserved for issuance under the 2018 Plan. As of January 1, 2022, the registration statement filed in connection with the IPO. The 2018 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock, restricted stock units, performance units, and performance shares to the Company’s employees, directors, and consultants. The maximum aggregate number of shares that may be issued under the 2018 Plan ~~is 14,482,356~~increased to 20,915,919 shares, which includes an increase of 2,144,521 shares effective January 1, 2022 under the terms of the ~~Company’s common stock. In addition,~~2018 Plan.

The following table summarizes the ~~number of~~ shares ~~reserved~~available for ~~issuance~~grant under the 2018 Plan will be increased automatically on the first day of each fiscal year beginning with the 2020 fiscal year, by a number equal to the least of: (i) 2,144,521 shares; (ii) 4.0% of the shares of common stock outstanding on the last day of the prior fiscal year; or (iii) such number of shares determined by the Company’s Board of Directors.Plan:

The 2018 Plan may be amended, suspended or terminated by the Company’s Board of Directors at any time, provided such action does not impair the existing rights of any participant, subject to stockholder approval of any amendment to the 2018 Plan as required by applicable law or listing

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~



			Shares Available for Grant
Balance - December 31, 2021			6,515,807
Authorized			2,144,521
Granted			(1,204,318)
Shares withheld to cover taxes			23,241
Forfeited			102,009
Balance - July 2, 2022			7,581,260

~~requirements. Unless sooner terminated by the Company’s Board of Directors, the 2018 Plan will automatically terminate on November 14, 2028.~~

As of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018,~~2021, there were ~~4,900,328~~4,402,397 and ~~5,120,293~~3,956,364 shares, respectively, issuable under stock options ~~outstanding, 4,504,914~~outstanding; 983,304 and ~~4,335,331~~608,175 shares, respectively, issuable under unvested RSUs outstanding; 7,997,539 and 7,730,884 shares, respectively, issued for stock option exercises, RSU settlement, and restricted stock ~~grants,~~grants; and ~~57,213~~7,581,260 and ~~6,859~~6,515,807 shares, respectively, available for grant under the ~~2011~~2018 Plan.

~~As of March 30, 2019, there were 4,577,114 shares of common stock reserved for future grant or issuance under the 2018 Plan, from which (i) options~~

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to purchase 264,033 shares of common stock were granted on April 3, 2019, having an exercise price of $20.02 per share, (ii) options to purchase (A) 1,000,000 shares of common stock were granted on April 18, 2019, (B) 51,999 shares of common stock were granted on April 29, 2019, and (C) 50,000 shares of common stock were granted on May 1, 2019, in each case to be effective upon and subject to the effectiveness of the registration statement relating to the Company’s IPO and having an exercise price equal to the IPO price of $25.00 per share, and (iii) awards covering 99,433 shares of restricted stock were granted on April 18, 2019 at a purchase price of $0.01 per share and which will be issued upon payment of the purchase price.Unaudited Condensed Consolidated Financial Statements (continued)

Stock Options

~~No stock option grants were awarded~~Following are the assumptions used in the Black-Scholes valuation model for options granted during the periods shown below:


	Three Months Ended		Six Months Ended
	July 2, 2022	July 3, 2021	July 2, 2022	July 3, 2021
Risk-free interest rate	3.0%	1.3%	1.9%	1.3%
Average expected term (years)	7.0	7.0	7.0	7.0
Expected volatility	55.0%	74.0%	55.0%	72.8%
Dividend yield	—	—	—	—

Option grants to new employees in the six months ended July 2, 2022 and July 3, 2021 generally vest 25% of the total award on the first anniversary of the vesting commencement date, and thereafter ratably vesting monthly over the remaining three-year period, subject to continued employment through the vesting date. Option grants to continuing employees in the six months ended July 2, 2022 generally vest 25% of the total award on the first anniversary of the vesting commencement date, and thereafter ratably vesting monthly over the remaining three-year period, subject to continued employment through the vesting date. Option grants to continuing employees in the six months ended July 3, 2021 generally vest monthly over a 48-month period, subject to continued employment through the vesting date. An option grant to one executive officer in the six months ended July 3, 2021 vested over three months ~~ended March 30, 2019.~~from the vesting commencement date.

The following table summarizes the Company’s stock option activity during the ~~three~~six months ended ~~March 30, 2019:~~July 2, 2022:

Number
of
Stock
Options Weighted
Average
Exercise
Price Weighted
Average
Remaining
Contractual
Life (Years)
Aggregate
Intrinsic
Value (in thousands)⁽¹⁾
Outstanding at December 31, 2018 5,120,293
$ 3.13
7.3 $ 81,371
Granted —
$ —
— $ —
Exercised (169,583 ) $ 2.16
— $ 2,859
Cancelled/Forfeited (50,382 ) $ 4.34
— $ —
Outstanding at March 30, 2019 4,900,328
$ 3.15
7.0 $ 80,076
Vested and exercisable at March 30, 2019 2,981,633
$ 1.11
5.9 $ 54,793
Vested and expected to vest at March 30, 2019 3,967,483
$ 2.16
5.9 $ 68,759


	Number of Stock Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (in thousands)(1)
Outstanding at December 31, 2021	3,956,364	$	27.04	5.9	$	180,302
Granted	670,525	$	44.83	—	$	—
Exercised	(177,024)	$	7.38	—	$	6,017
Cancelled/Forfeited	(47,468)	$	75.99	—	$	—
Outstanding at July 2, 2022	4,402,397	$	30.01	6.0	$	49,535
Vested and exercisable at July 2, 2022	3,006,753	$	17.09	4.7	$	49,124
Vested and expected to vest at July 2, 2022	3,862,463	$	26.17	6.8	$	49,525

__________

(1) Aggregate intrinsic value is calculated as the difference between the value of common stock on the transaction date and the exercise price multiplied by the number of shares issuable under the stock option. Aggregate intrinsic value of shares outstanding at the beginning and end of the reporting period is calculated as the difference between the value of common stock on the beginning and end dates, respectively, and the exercise price multiplied by the number of shares outstanding.

During the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018,~~July 3, 2021, the Company recorded ~~in aggregate $0.6~~$4.3 million and ~~$0.2~~$3.7 million, respectively, of share-based compensation expense related to ~~options issued~~options. During the six months ended July 2, 2022 and July 3, 2021, the Company recorded $8.4 million and $7.1 million, respectively, of share-based compensation expense related to ~~employees and nonemployees.~~options. The share-based compensation expense is included in cost of goods sold, research and development expenses and SG&A expenses in the Company’s condensed consolidated statements of operations.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

As of ~~March 30, 2019 and December 31, 2018,~~July 2, 2022, there was ~~$2.3 million and $2.4~~$25.6 million in unrecognized compensation expense related to nonvested stock option awards which is expected to be recognized over ~~2.7 years and 2.9 years, respectively.~~

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

a weighted average period of 1.4 years.

Restricted Stock Units

RSU grants to ~~Nonemployees~~

~~In October 2018,~~new and continuing employees in the six months ended July 2, 2022 generally vest 25% of the total award on the first anniversary of the vesting commencement date, and thereafter vest quarterly over the remaining three years of the award, subject to continued employment through the vesting date. Some of the RSU grants to continuing employees in the six months ended July 2, 2022 vest 50% of the total award on the first anniversary of the vesting commencement date, and thereafter vest quarterly over the remaining four quarters of the award, subject to continued employment through the vesting date. Annual RSU grants to directors on the Company’s Board of Directors ~~approved~~(the “Board”) in the issuance of 135,791 shares of restricted stock with a fair value of $17.03 per share and a purchase price of $0.02 per share to nonemployees serving as the Company’s brand ambassadors. The Company has the right to repurchase the unvested shares upon a voluntary or involuntary termination of a brand ambassador’s service; however, as sharessix months ended July 2, 2022 vest monthly over 12a one-year period and an RSU grant to 24a new director on the Board vests monthly over a three-year period. RSU grants to nonemployee brand ambassadors in the six months ~~they are being released~~ended July 2, 2022 vest on varying dates, subject to continued service through the vesting date.

RSU grants to new employees in the six months ended July 3, 2021 vest 25% of the total award on the first anniversary of the vesting commencement date, and thereafter vest quarterly over the remaining three years of the award, subject to continued employment through the vesting date. RSU grants in the six months ended July 3, 2021 include fully vested RSUs granted to an executive officer issued in settlement of the obligation discussed below under Share-Settled Obligation. An RSU grant to one executive officer in the six months ended July 3, 2021 vested 100% over three months from the ~~repurchase option (and all such shares will be released~~vesting commencement date. RSU grants to continuing employees in the six months ended July 3, 2021 generally vest quarterly over 16 quarters, subject to continued employment through the vesting date. An RSU grant to one executive officer in the six months ended July 3, 2021 vests quarterly over four quarters, subject to continued employment through the vesting date. Annual RSU grants to the Board in the six months ended July 3, 2021 vest monthly over a one-year period and RSU grants to 2 new directors on the Board vest monthly over a three-year period. RSU grants to nonemployee brand ambassadors in the six months ended July 3, 2021 vest quarterly over four quarters from the ~~repurchase option by November 1, 2020).~~vesting commencement date, subject to continued service through the vesting date.

The following table summarizes the Company’s ~~restricted stock~~RSU activity during the ~~three~~six months ended ~~March 30, 2019:~~July 2, 2022:


	Number of Units	Weighted Average Grant Date Fair Value Per Unit
Unvested at December 31, 2021	608,175	$	88.78
Granted	533,793	$	43.71
Vested(1)	(104,617)	$	91.62
Cancelled/Forfeited	(54,047)	$	85.62
Unvested at July 2, 2022	983,304	$	64.18

Number
of Shares of
Restricted Stock Weighted
Average
Remaining
Contractual
Life (Years)
Weighted
Average
Grant Date
Fair Value
Per Share
Outstanding at December 31, 2018 100,127
1.6 $ 17.03
Granted —
— $ —
Vested/Released (12,946 ) — $ —
Cancelled/Forfeited —
— $ —
Outstanding at March 30, 2019 87,181
1.4 $ 17.03
________

(1) Includes 23,241 shares of common stock that were withheld to cover taxes on the release of vested RSUs and became available for future grants pursuant to the 2018 Plan.

During the three months ended ~~March 30, 2019,~~July 2, 2022 and July 3, 2021, the Company recorded $6.0 million and $3.3 million, respectively, of share-based compensation expense related to RSUs. During the six months ended July 2, 2022 and July 3, 2021, the Company recorded $11.2 million and $6.3 million, respectively, of share-based compensation expense related to RSUs. The share-based compensation

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

expense is included in ~~aggregate $0.3~~cost of goods sold, research and development expenses and SG&A expenses in the Company’s condensed consolidated statements of operations.

As of July 2, 2022, there was $35.3 million in unrecognized compensation expense related to unvested RSUs which is expected to be recognized over a weighted average period of 1.4 years.

Share-Settled Obligation

Share-based compensation expense in the three months ended July 2, 2022 and July 3, 2021 includes $0 and $0.8 million, respectively, for a liability classified, share-settled obligation to an executive officer related to a sign-on award pursuant to the terms of the executive officer’s offer letter. Share-based compensation expense in the six months ended July 2, 2022 and July 3, 2021 includes $0 and $1.6 million, respectively, for a liability classified, share-settled obligation to an executive officer related to a sign-on award pursuant to the terms of the executive officer’s offer letter. The share-based compensation expense related to this share-settled obligation is included in SG&A expenses in the Company’s condensed consolidated statements of operations. Financing activities in the statement of cash flows for the six months ended July 2, 2022 and July 3, 2021 includes $0 and $1.6 million, respectively, noncash reclassification of the share-settled obligation from “Other current liabilities” to “Additional paid-in capital.”

In the first six months of 2021, two quarterly tranches related to this obligation were earned, and the Company delivered to this executive officer 13,804 fully vested RSUs with a settlement date fair value of $1.6 million.

Restricted Stock to Nonemployees

During the six months ended July 2, 2022, no shares of restricted stock had been issued to nonemployee brand ambassadors.

During the three months ended July 2, 2022 and July 3, 2021, the Company recorded $0 and $34,000, respectively, of share-based compensation expense related to restricted stock issued to nonemployee brand ambassadors, which is included in SG&A expenses in the Company’s condensed consolidated statements of operations.

During the six months ended July 2, 2022 and July 3, 2021, the Company recorded $0 million and $0.2 million, respectively, of share-based compensation expense related to restricted stock issued to nonemployee brand ambassadors, which is included in SG&A expenses in the Company’s condensed consolidated statements of operations.

As of ~~March 30, 2019,~~July 2, 2022, there was ~~$1.4 million in~~no unrecognized compensation expense related to ~~nonvested~~unvested restricted stock ~~which is expected~~granted to ~~be recognized over 1.4 years.~~

In April 2019, the Company’s Board of Directors approved the issuance of 99,433 shares of restricted stock with a fair value of $20.02 per share and a purchase price of $0.02 per share to nonemployees serving as the Company’snonemployee brand ambassadors. The Company has the right to repurchase the unvested shares upon a voluntary or involuntary termination of a brand ambassador’s service; however, as shares vest monthly over 24 months, they are being released from the repurchase option (and all such shares will be released from the repurchase option by May 18, 2021).

Employee ~~stock purchase plan~~Stock Purchase Plan

~~On November 15, 2018,~~As of July 2, 2022, the ~~Company’s Board~~maximum aggregate number of ~~Directors adopted its~~shares that may be issued under the 2018 Employee Stock Purchase Plan (“~~2018~~ ESPP”)~~, which~~ was subsequently approved by the Company’s stockholders and became effective on April 30, 2019, the day immediately prior to the effectiveness of the registration statement filed in connection with the IPO. The 2018 ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code (the “Code”) for U.S. employees. In addition, the 2018 ESPP authorizes grants of purchase rights that do not comply with Section 423 of the Code under a separate non-423 component for non-U.S. employees and certain non-U.S. service providers. The Company has reserved ~~804,195~~2,412,585 shares of common stock, ~~for issuance~~including an increase of 536,130 shares effective January 1, 2022 under the 2018 ESPP. In addition, the number of shares reserved for issuance under the 2018 ESPP will be increased automatically on the first day of each fiscal year for a period of up to ten years, starting with the 2020 fiscal year, by a number equal to the least of: (i) 536,130 shares; (ii) 1%terms of the ~~shares of common stock outstanding on the last day of the prior fiscal year; or (iii) such lesser number of shares determined by the Company’s Board of Directors.~~ESPP. The ~~2018~~ ESPP is expected to be implemented through a series of offerings under which participants are granted purchase rights to purchase shares of the Company’s

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

common stock on specified dates during such offerings. The administrator has not yet approved an offering under the ~~2018~~ ESPP.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

Note 9.10. Commitments and Contingencies

Leases

~~Effective March 1, 2019,~~See Note 4, Leases.

On January 14, 2021, the Company entered into the Campus Lease with HC Hornet Way, LLC, a ~~lease for its principal executive~~Delaware limited liability company (the “Landlord”), to house the Company’s lab and innovation space and headquarters offices in El Segundo, ~~California, for~~California.

In the three and six months ended July 2, 2022, the Company paid $0.5 million and $0.8 million, respectively, in payments towards common area maintenance, parking, and insurance. No such payments were made in the three and six months ended July 3, 2021.

Although the Company is involved in the design of the tenant improvements of the Premises, the Company does not have title or possession of the assets during construction. In addition, the Company does not have the ability to control the leased Premises until each phase of the tenant improvements is complete. As of July 2, 2022, the tenant improvements associated with Phase 1-A had not been completed, and the underlying asset had not been delivered to the Company. Accordingly, there was no lease commencement during the six months ended July 2, 2022. Therefore, the Company has not recognized an ~~initial term of 5 years. The aggregate lease amount~~asset or a liability for the ~~five-year~~Campus Lease in its condensed consolidated balance sheets as of July 2, 2022 and December 31, 2021. The Company contributed $43.7 million and $59.2 million in payments to a construction escrow account in the six months ended July 2, 2022 and the year ended December 31, 2021, respectively. These payments are recorded in “Prepaid lease costs, non-current” in the Company’s condensed consolidated balance sheets as of July 2, 2022 and December 31, 2021, respectively, which will ultimately be recorded as a component of a right-of-use asset upon lease commencement.

Concurrent with the Company’s execution of the Campus Lease, as a security deposit, the Company delivered to the Landlord a letter of credit under its revolving credit facility at the time in the amount of $12.5 million which amount will decrease to: (i) $6.3 million on the fifth (5th) anniversary of the Rent Commencement Date (as defined in the Campus Lease); (ii) $3.1 million on the eighth (8th) anniversary of the Rent Commencement Date; and (iii) $0 in the event the Company receives certain credit ratings; provided the Company is not then in default of its obligations under the Campus Lease. Upon termination of the revolving credit facility, the letter of credit continued in effect, unsecured.

China Investment and Lease Agreement

On September 22, 2020, the Company and its wholly-owned subsidiary, Beyond Meat (Jiaxing) Food Co., Ltd. (“BYND JX”), entered into an investment agreement with the Administrative Committee (the “JX Committee”) of the Jiaxing Economic & Technological Development Zone (the “JXEDZ”) pursuant to which, among other things, BYND JX has agreed to make certain investments in the JXEDZ in two phases of development, and the Company has agreed to guarantee certain repayment obligations of BYND JX under such agreement.

During Phase 1, the Company had agreed to invest $10.0 million in the JXEDZ through an intercompany investment in BYND JX and BYND JX has agreed to lease a facility in the JXEDZ for a minimum of two years. In connection with such agreement, BYND JX entered into a factory leasing contract with an affiliate of the JX Committee, pursuant to which BYND JX has agreed to lease and renovate a facility in the JXEDZ and lease it for a minimum of two years. In the three months ended July 2, 2022, the lease was amended to extend the term ~~is $2.7 million.~~ an additional five years without rent escalation. As of July 2, 2022, the Company had invested $22.0 million and had advanced $20.0 million to its subsidiary, BYND JX.

In the event that the Company and BYND JX determine, in their sole discretion, to proceed with the Phase 2 development in the JXEDZ, BYND JX has agreed in the first stage of Phase 2 to increase its registered capital by $30.0 million and to acquire the land use right to a state-owned land plot in the

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

JXEDZ to conduct development and construction of a new production facility. Following the first stage of Phase 2, the Company and BYND JX may determine, in their sole discretion, to permit BYND JX to obtain a second state-owned land plot in the JXEDZ in order to construct an additional facility thereon.

The ~~future minimum lease payments required under noncancelable lease obligations related~~Planet Partnership

On January 25, 2021, the Company entered into TPP, a joint venture with PepsiCo, Inc., to ~~this lease are $2.6~~develop, produce and market innovative snack and beverage products made from plant-based protein. For the three months ended July 2, 2022 and July 3, 2021, the Company recognized its share of the net losses in TPP, in the amount of $1.4 million ~~due through 2023 (approximately $0.5~~and $0.2 million, ~~annually)~~respectively. For the six months ended July 2, 2022 and ~~$0.1~~July 3, 2021, the Company recognized its share of the net losses in TPP in the amount of $2.1 million ~~thereafter.~~and $0.6 million, respectively. For the year ended December 31, 2021, the Company contributed its share of the investment in TPP, $11.0 million, which was increased subsequent to the quarter ended July 2, 2022. See Note 2, Note 13 and Note 14.

Purchase Commitments

As of ~~March 30, 2019,~~July 2, 2022, the Company had ~~committed~~a commitment to purchase pea protein inventory totaling ~~$46.1~~$56.4 million. in the remainder of 2022, which commitment schedule was amended subsequent to the quarter ended July 2, 2022 to purchase $16.2 million in the remainder of 2022 and $40.2 million in 2023. See Note 14.

On April 6, 2022, the Company entered into a co-manufacturing agreement (“Agreement”) with a co-manufacturer to manufacture various products for the Company. The Agreement includes a minimum order quantity commitment per month and an aggregate quantity over a 5-year term. If the minimum order for a month during a quarter is not fulfilled, the Company may be assessed a fee per pound, which fee may be waived by the co-manufacturer upon reaching certain aggregate quantity limits. The following table sets forth the schedule of the fees for the committed quantity under the Agreement.


(in thousands)	As of July 2, 2022
Remainder of 2022	$	4,925
2023	11,820
2024	11,820
2025	11,820
2026	11,820
2027	34,475
	$	86,680

Litigation

Don Lee Farms

On May 25, 2017, Don Lee Farms, a ~~former co-manufacturer~~division of ~~the Company~~Goodman Food Products, Inc., filed a complaint against the Company in the Superior Court of the State of California for the County of Los Angeles asserting claims for ~~(1)~~ breach of contract, ~~(2)~~ misappropriation of trade secrets, ~~(3)~~ unfair competition under the California Business &and Professions Code, ~~Section 17200 Et. Seq., (4)~~ money owed and due, ~~(5)~~ declaratory relief and ~~(6)~~ injunctive relief, each arising out of the Company’s decision to terminate an exclusive supply agreement ~~dated December 2, 2014~~ between the Company and ~~the former co-manufacturer, pursuant to its terms (see~~ ~~Note 3~~).Don Lee Farms. The Company ~~denies~~denied all of these claims and filed ~~counter-claims~~counterclaims on July 27, 2017, alleging ~~(1)~~ breach of contract, ~~(2)~~ unfair competition under the California Business &and Professions Code ~~Section 17200 Et. Seq.,~~ and ~~(3) conversion, and is in the process of litigating this matter.~~

conversion. In October 2018, the former co-manufacturer filed an amended complaint that added one of the Company’s then current contract manufacturers as a defendant, principally for claims arising from the then current contract manufacturer’s alleged use of the former co-manufacturer’s alleged trade secrets, and for replacing the former co-manufacturer as one of the Company’s ~~current~~ co-manufacturers. The then current ~~co-manufacturer~~contract manufacturer filed an answer denying all of ~~the former co-manufacturer’s~~Don Lee Farms’ claims and a cross-complaint against Beyond Meat asserting claims of total and partial equitable indemnity, contribution, and

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

repayment. On March 11, 2019, ~~the former co-manufacturer~~Don Lee Farms filed a second amended complaint to add claims of fraud and negligent misrepresentation against the Company. On May 30, 2019, the judge denied the Company’s motion to dismiss the fraud and negligent misrepresentation claims, allowing the claims to proceed. AOn June 19, 2019, the Company filed an answer denying Don Lee Farms' claims.

On January 24, 2020, a writ judge granted Don Lee Farms a right to attach in the amount of $628,689 on the grounds that Don Lee Farms had established a “probable validity” of its claim that Beyond Meat owes Don Lee Farms money for a small batch of unpaid invoices. This determination was not made by the trial judge.

On January 27, 2020, Don Lee Farms filed a third amended complaint to add 3 individual defendants, all of whom are current or former employees of the Company, including Mark Nelson, the Company’s former Chief Financial Officer and Treasurer, to Don Lee Farms’ existing fraud claims alleging that those individuals were involved in the alleged fraudulent misrepresentations. On June 23, 2020, the judge denied Beyond Meat and the individual defendants’ motion to dismiss the fraud and negligent misrepresentation claims, allowing the claims to proceed. On July 6, 2020, the Company and the individual defendants filed an answer denying all of Don Lee Farms’ claims, including denying all allegations of fraud and negligent misrepresentation.

On August 11, 2020, the Company filed an amended cross-complaint against Don Lee Farms, its parent Goodman Food Products, Inc. and its owners and employees, Donald, Daniel, and Brandon Goodman. Among other claims, the amended cross-complaint alleges that Don Lee Farms defrauded Beyond Meat, misappropriated its trade secrets, and infringed its trademarks.

On January 28, 2021, Don Lee Farms filed a motion for summary adjudication on its breach of contract and money owed claims and on Beyond Meat’s breach of contract claims. On February 18, 2021, Don Lee Farms and Donald, Daniel and Brandon Goodman filed a motion for summary adjudication on Beyond Meat’s fraud, negligent misrepresentation, and conversion claims.

On February 16, 2021, the Court entered an order consolidating this action with an action that Don Lee Farms filed against CLW Foods, LLC, a current Beyond Meat contract manufacturer. On February 22, 2021, CLW Foods, LLC requested a continuance of the trial date, which the Court granted.

On March 19, 2021, Don Lee Farms requested the dismissal, without prejudice, of Don Lee Farms’ claims against the Company’s former contract manufacturer, ProPortion Foods, LLC and current contract manufacturer CLW Foods, LLC. On March 23, 2021, ProPortion Foods, LLC requested that its claims against the Company be dismissed without prejudice. On March 26, 2021, the Court granted Don Lee Farms’ request to dismiss its claims against ProPortion Foods, LLC and CLW Foods, LLC; and granted ProPortion Foods, LLC request to dismiss its claims against the Company.

On May 7, 2021, the Court ruled on Don Lee Farms’ motions for summary adjudication. The Court granted Don Lee Farms’ motion for summary adjudication on its breach of contract and money owed claims, and Beyond Meat’s negligent misrepresentation and conversion claims. The Court denied Don Lee Farms’ motion for summary adjudication on Beyond Meat’s breach of contract and fraud claims, allowing Beyond Meat’s claims to proceed to trial.

On June 11, 2021, former Beyond Meat employees Mark Nelson and Tony Miller, and current employee, Jessica Quetsch (collectively, the “individual defendants”), filed a motion for summary adjudication on Don Lee Farms’ fraud claim asserted against them. On June 11, 2021, the Company filed a motion for summary adjudication on Don Lee Farms’ fraud and negligent misrepresentation claims, misappropriation of trade secret claim, and unfair competition claim under the California Business and Professions Code. On August 27, 2021, the Court ruled on the individual defendants’ and the Company’s motions for summary adjudication. The Court denied the individual defendants’ motion for summary adjudication. The Court also denied the Company’s motion for summary adjudication on Don Lee Farms’ fraud and negligent misrepresentation claims. The Court granted the Company’s motion for summary

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

adjudication on Don Lee Farms’ trade secret misappropriation and unfair competition claims. Don Lee Farms’ trade secret misappropriation and unfair competition claims will not proceed to trial.

On January 27, 2022, Don Lee Farms filed a motion for summary adjudication on Beyond Meat’s trade secret misappropriation claim. On April 19, 2022, the Court denied Don Lee Farms motion for summary adjudication on Beyond Meat’s trade secret misappropriation claim. Beyond Meat’s trade secret misappropriation claim will proceed to trial.

The previous trial date, May 16, 2022, was continued. Trial is currently set for September 26, 2022.

Don Lee Farms is seeking from Beyond Meat and the individual defendants unspecified compensatory and punitive damages, declaratory and injunctive relief, and attorneys’ fees and costs. The Company is seeking from Don Lee Farms monetary damages, restitution of monies paid to Don Lee Farms, injunctive relief, including the prohibition of Don Lee Farms’ use or disclosure of Beyond Meat’s trade secrets and the prohibition of Don Lee Farms’ infringing use of Beyond Meat’s trademarks, and attorneys’ fees and costs.

The Company believes it was justified in terminating the supply agreement with Don Lee Farms, that the Company is not liable for the fraud or negligent misrepresentation alleged in the third amended complaint, and that Don Lee Farms is liable for the conduct alleged in the Company’s amended cross-complaint. Conversely, as alleged in the Company’s amended cross-complaint, the Company believes Don Lee Farms misappropriated the Company’s trade secrets, defrauded the Company, and ultimately has infringed the Company’s trademarks.

The Company is currently in the process of litigating this matter and intends to vigorously defend itself and its current and former employees against the claims and to prosecute the Company’s own claims.

The Company cannot provide assurance that Don Lee Farms will not prevail in all or some of their claims against the Company or the individual defendants, or that the Company will prevail in some or all of its claims against Don Lee Farms. For example, if Don Lee Farms succeeds in the lawsuit, the Company could be required to pay damages, including but not limited to contract damages reasonably calculated at what the Company would have paid Don Lee Farms to produce the Company’s products through 2019, the end of the contract term. Based on the Company’s current knowledge, the Company has determined that the amount of any material loss or range of any losses that is reasonably possible to result from this lawsuit is not estimable.

Don Lee Farms II

On June 2, 2022, Don Lee Farms, a division of Goodman Food Products, Inc., filed a complaint against the Company and Chief Executive Officer Ethan Brown, in the Central District of California, asserting claims for violation of the Lanham Act, false advertising, and unfair competition under the California Business and Professions Code, each arising out of claims that the Company’s Beyond Burger and Beyond Crumble products inaccurately state the daily value percentage of protein contained within and the Company erroneously markets these products as free of synthetic ingredients. Don Lee Farms is seeking from the Company and Mr. Brown unspecified compensatory and punitive damages, restitution, declaratory and injunctive relief, and attorneys’ fees and costs. On August 5, 2022, the Company and Mr. Brown each filed motions to dismiss the case. The Company is currently in the process of litigating this matter and intends to vigorously defend itself and Mr. Brown against the claims. Based on the Company’s current knowledge, the Company has determined that the amount of any material loss or range of any losses that is reasonably possible to result from this lawsuit is not estimable.

Consumer Class Actions Regarding Protein Claims

From May 31, 2022 through July 26, 2022, multiple putative class action lawsuits were filed against the Company in various federal courts alleging that the labeling and marketing of certain of the Company’s products is false and/or misleading under federal and/or various states’ laws. Specifically, each of these lawsuits allege one or more of the following theories of liability: (i) that the labels and

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

related marketing of the challenged products misstate the quantitative amount of protein that is provided by each serving of the product; (ii) that the labels and related marketing of the challenged products misstate the percent daily value of protein that is provided by each serving of the product; and (iii) that the Company has represented that the challenged products are “all-natural,” “organic,” or contain no “synthetic” ingredients when they in fact contain methylcellulose, an allegedly synthetic ingredient. The named plaintiffs of each complaint seek to represent classes of nationwide and/or state-specific consumers, and seek on behalf of the putative classes damages, restitution, and injunctive relief, among other relief. Additional complaints asserting these theories of liability are possible. The Company intends to vigorously defend against all claims asserted in the complaints. Based on the Company’s current knowledge, the Company has determined that the amount of any material loss or range of any losses that is reasonably possible to result from these lawsuits is not estimable.

The active lawsuits are:

•Roberts v. Beyond Meat, Inc., No. 1:22-cv-02861 (N.D. Ill.) (filed May 31, 2022)

•Yoon v. Beyond Meat, Inc., No. 5:22-cv-01032 (C.D. Cal.) (filed June 24, 2022)

•DeLoss v. Beyond Meat, Inc., No. 2:22-cv-04405 (C.D. Cal.) (filed June 28, 2022)

•Borovoy v. Beyond Meat, Inc., No. 3:22-cv-50242 (N.D. Ill.) (filed July 6, 2022)

•Cascio v. Beyond Meat, Inc., No. 1:22-cv-04018 (E.D.N.Y.) (filed July 8, 2022)

•Miller v. Beyond Meat, Inc., No. 1:22-cv-06336 (S.D.N.Y.) (filed July 26, 2022)

Securities Related Litigation

On January 30, 2020, Larry Tran, a purported shareholder of Beyond Meat, filed a putative securities class action lawsuit in the United States District Court for the Central District of California against Beyond Meat and 2 of the Company’s executive officers, the Company’s President and CEO, Ethan Brown, and the Company’s former Chief Financial Officer and Treasurer, Mark Nelson. As noted here and in previous filings, the Tran securities class action was dismissed with prejudice on October 27, 2020, except for the class allegations of absent putative class members, which were dismissed without prejudice.

On March 16, 2020, Eric Weiner, a purported shareholder of Beyond Meat, filed a shareholder derivative lawsuit in the United States District Court for the Central District of California, putatively on behalf of the Company, against 2 of the Company’s executive officers, the Company’s President and CEO, Ethan Brown, and the Company’s former Chief Financial Officer and Treasurer, Mark Nelson, and each of the Company’s directors, including one former director, who signed the Company’s initial public offering registration statement. The lawsuit asserts claims under Sections 10(b) and 21D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), claims of breaches of fiduciary duty as directors and/or officers of Beyond Meat, and claims of unjust enrichment and waste of corporate assets, all relating to the Company’s ongoing litigation with Don Lee Farms, related actions taken by Beyond Meat and the named individuals during the period of May 2, 2019 to March 16, 2020, and the Tran securities case brought against the Company.

On March 18, 2020, Kimberly Brink and Melvyn Klein, purported shareholders of Beyond Meat, filed a shareholder derivative lawsuit in the United States District Court for the Central District of California, putatively on behalf of the Company, against 2 of the Company’s executive officers, the Company’s President and CEO, Ethan Brown, and the Company’s former Chief Financial Officer and Treasurer, Mark Nelson, and each of the Company’s directors, including one former director, who signed the Company’s initial public offering registration statement. The lawsuit asserts claims under Sections 10(b) and 21D of the Exchange Act, claims of breaches of fiduciary duty as directors and/or officers of Beyond Meat, and claims of unjust enrichment and waste of corporate assets, all relating to the Company’s ongoing litigation with Don Lee Farms, related actions taken by Beyond Meat and the named individuals during the period of May 2, 2019 to March 18, 2020, and the Tran securities case brought against the Company.

On May 27, 2020, Kevin Chew, a purported shareholder of Beyond Meat, filed a shareholder derivative lawsuit in the United States District Court of the District of Delaware (the “Chew Derivative

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

Action”), putatively on behalf of the Company, against 2 of the Company’s executive officers, the Company’s President and CEO, Ethan Brown, and the Company’s former Chief Financial Officer and Treasurer, Mark Nelson, and each of the Company’s directors, including one former director, who signed the Company’s initial public offering registration statement. The lawsuit asserts claims under Sections 10(b) and 21D of the Exchange Act and claims of breaches of fiduciary duty, relating to the Company’s ongoing litigation with Don Lee Farms, related actions taken by Beyond Meat and the named individuals during the period of May 2, 2019 to May 27, 2020. On June 16, 2020, the Court entered an order staying all proceedings in the derivative action until (1) the Tran securities class action is dismissed, with prejudice, and all appeals related thereto have been exhausted; or (2) any motion to dismiss the Tran securities class action is denied in whole or in part. On June 17, 2020, the Court entered an order administratively closing the derivative case based on the stay order. On July 29, 2021, the Court entered a Joint Stipulation to Continue the Stay of the Action, staying the case until the resolution of the California Derivative Action.

On April 1, 2020, the United States District Court for the Central District of California entered an order consolidating the Weiner action and the Brink/Klein action for all purposes and designated the consolidated case In re: Beyond Meat, Inc. Derivative Litigation (the “California Derivative Action”). On April 13, 2020, the Court entered an order appointing co-lead counsel for the California Derivative Action. On June 23, 2020, the Court entered an order approving a Joint Stipulation Regarding Stay of Actions. Under the terms of the stay approval order, all proceedings in the California Derivative Action are stayed until (1) the Tran securities class action is dismissed, with prejudice, and all appeals related thereto have been exhausted; or (2) any motion to dismiss the Tran securities class action is denied in whole or in part. As noted herein and in previous filings, the Tran securities class action was dismissed with prejudice on October 27, 2020, except for the class allegations of absent putative class members, which were dismissed without prejudice. On April 20, 2021, the parties filed a joint stipulation regarding briefing schedule, and the Court entered a schedule on April 21, 2021.

On May 24, 2021, the plaintiffs in the California Derivative Action filed a First Amended Complaint (“FAC”). The FAC names the same defendants named in the originally-filed consolidated complaint and adds four additional defendants, including ProPortion Foods, LLC (“ProPortion”) and CLW Foods, LLC (“CLW”). The FAC asserts claims under Section 14(a) of the Exchange Act, claims of breach of fiduciary duty, unjust enrichment, waste of corporate assets, abuse of control and gross mismanagement against the individual defendants, and aiding and abetting claims against CLW and ProPortion. All of these claims relate to the Company’s dealings and ongoing litigation with Don Lee Farms, and related actions taken by Beyond Meat and the named individuals during the period of April 2016 to the present. On July 2, 2021, the Court entered a Joint Stipulation Regarding Extension of Briefing Schedule so that the parties could attempt to reach resolution of the lawsuit.

The parties have reached a settlement of the California and Chew Derivative Actions. The proposed settlement, which is subject to final Court approval, includes the Company enacting certain corporate governance reforms and paying plaintiffs’ attorney fees and costs in the amount of $515,000, which amount has been ~~set~~accrued as of April 2, 2022 and December 31, 2021. No other payment is contemplated in the proposed settlement. The Stipulation of Settlement was signed on January 14, 2022, and Plaintiffs filed a motion for ~~May 18, 2020. At this time~~preliminary approval that same day. On February 8, 2022, the Court entered a Scheduling Notice and Order finding that Plaintiffs’ motion for preliminary approval is appropriate for submission on the papers without oral argument. On March 31, 2022, the Court entered an order preliminarily approving the Stipulation of Settlement. On April 8, 2022, the Company ~~cannot reasonably estimate~~published notice of the preliminary approval and the proposed settlement in accordance with the Stipulation of Settlement. On April 18, 2022, the Company paid to escrow the $515,000 for Plaintiffs’ attorneys’ fees and costs and on April 19, 2022, the Company filed proof of notice with the Court. Plaintiffs filed their motion for final approval on June 13, 2022.On July 1, 2022, Plaintiffs filed a notice of non-objection, stating that they received no objections to the proposed settlement. The Final Approval Hearing was scheduled for July 11, 2022, but on July 7, 2022, the Court entered a Scheduling Notice and Order finding that Plaintiffs’ motion for final approval is appropriate for submission on the papers without oral argument.

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

Interbev

In October 2020, Interbev, a French trade association for the cattle industry sent a cease-and-desist letter to one of the Company’s contract manufacturers alleging that the use of “meat” and meat-related terms is misleading the French consumer. Despite the Company’s best efforts to reach a settlement, including a formal settlement proposal from the Company in March 2021, the association no longer responded. Instead, on March 13, 2022, the Company was served a summons by Interbev to appear before the Commercial Court of Paris. The summons alleges that the Company misleads the French consumer with references to e.g. “plant based meat,” “plant based burger” and related descriptive names, and alleges that the Company is denigrating meat and meat products. The relief sought by Interbev includes (i) changing the presentation of Beyond Meat products to avoid any potential ~~liability associated~~confusion with meat products, (ii) publication of the judgment of the court in the media, and (iii) damages of EUR 200,000. The Company strongly denies these claims and will defend its position with the utmost vigor. The litigation is expected to take at least 18 months in first instance, and if the Court rules against the Company, it could disrupt the Company’s ability to market in France. Should the case be referred to the Court of Justice of the European Union, this ~~litigation, but believes~~case may have repercussions for the ~~final resolution~~entire plant-based protein industry, in all member states of ~~this litigation will not have a material adverse effect on its financial position, results of operations, or cash flows.~~the European Union.

The Company is involved in various other legal proceedings, claims, and litigation arising in the ordinary course of business. Based on the facts currently available, the Company does not believe that the disposition of such matters that are pending or asserted will have a material effect on its financial statements.

Note ~~10.~~11. Income Taxes

For the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018~~July 3, 2021, the Company recorded no$11,000 and $2,000, respectively, in income tax expense in its condensed consolidated statements of operations. For the six months ended July 2, 2022 and July 3, 2021, the Company recorded $21,000 and $50,000, respectively, in income tax expense in its condensed consolidated statements of operations.

The Company has evaluated the available evidence supporting the realization of its deferred tax assets, including the amount and timing of future taxable income, and has determined that it is more likely

~~BEYOND MEAT, INC.~~

~~Notes to Unaudited Condensed Financial Statements (continued)~~

than not that its net deferred tax assets will not be realized in the U.S. Due to uncertainties surrounding the realization of the deferred tax assets, the Company maintains a full valuation allowance against substantially all deferred tax assets. ~~When~~If the Company determines that it will be able to realize some portion or all of its deferred tax assets, an adjustment to its valuation allowance on its deferred tax assets will be made and the adjustment would have the effect of increasing net income in the period such determination is made.

As of ~~March 30, 2019,~~July 2, 2022, the Company ~~does~~did not have any accrued interest or penalties related to uncertain tax positions. The Company’s policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. The Company is subject to U.S. federal tax authority and U.S. state tax authority examinations for all years with respect to net operating loss and credit carryforwards.

In response to the COVID-19 pandemic, the United States passed the Coronavirus Aid, Relief, and Economic Security ("CARES") Act in March 2020 and on March 11, 2021 the United States enacted the American Rescue Plan Act of 2021. These Acts include various income and payroll tax measures. The income tax and payroll tax measures did not materially impact the Company’s financial statements.

Note ~~11.~~12. Net Loss Per Share ~~Attributable~~Available to Common Stockholders

The Company calculates basic and diluted net loss per share ~~attributable~~available to common stockholders in conformity with the two-class method required for companies with participating securities. ~~The~~Pursuant to Accounting Standards Update 2020-06, the Company ~~considers all series~~applies the more dilutive of ~~convertible preferred stock issued~~the if-converted method and ~~outstanding prior to the IPO to be participating securities. Under~~ the two-class method ~~the net loss attributable~~ to common stockholders is not allocated to the convertible preferred stock as the holders of convertible preferred stock issued and outstanding prior to the IPO do not have a contractual obligation to share in losses.

The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of this calculation, options to purchase common stock, common stock warrants and securities such as convertible preferred stock and convertible preferred stock warrants that were issued and outstanding before the Company’s IPO, are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive. Basic and diluted net loss per common share was the same for each period presented, as the inclusion of all potential common shares outstanding would have been antidilutive.its Notes.

(in thousands, except share and per share amounts) Three Months Ended
March 30, 2019 March 31, 2018
Numerator:
Net loss attributable to common stockholders $ (6,649 ) $ (5,696 )
Denominator:
Weighted average common shares outstanding—basic 6,974,301
5,793,801
Dilutive effect of stock equivalents resulting from stock options, common stock warrants, preferred stock warrants and convertible preferred stock (as converted) —
—
Weighted average common shares outstanding—diluted 6,974,301
5,793,801
Net loss per common share—basic and diluted $ (0.95 ) $ (0.98 )

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

~~The following weighted-average outstanding shares~~Computation of ~~common stock equivalents were excluded from the computation of diluted~~ net loss per share ~~attributable~~available to common stockholders for the ~~periods presented~~three and six months ended July 2, 2022 excludes the dilutive effect of 4,402,397 shares issuable under stock options and 983,304 RSUs outstanding at July 2, 2022 because the ~~impact~~Company incurred a net loss and their inclusion would be anti-dilutive. Computation of ~~including them~~net loss per share available to common stockholders for the three and six months ended July 2, 2022 also excludes the dilutive effect of the Notes because the Company recorded a net loss and their inclusion would be anti-dilutive. Computation of net loss per share available to common stockholders for the three and six months ended July 3, 2021 excludes the dilutive effect of 3,892,262 shares issuable under stock options and 303,392 RSUs outstanding as of July 3, 2021 because their inclusion would be anti-dilutive. Computation of net loss per share available to common stockholders for the three and six months ended July 3, 2021 also excludes adjustments under the two-class method relating to a liability classified, share-settled obligation to an executive officer to deliver a variable number of shares based on a fixed monetary amount (see Note 9) because the shares to be delivered are not participating securities as they do not have ~~been antidilutive:~~voting rights and are not entitled to participate in dividends until they are issued. Computation of net loss per share available to common stockholders for the three and six months ended July 3, 2021 also excludes the dilutive effect of the Notes because the Company recorded a net loss and their inclusion would be anti-dilutive.


(in thousands, except share and per share amounts)	Three Months Ended				Six Months Ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Numerator:
Net loss available to common stockholders	$	(97,134)	$	(19,652)	$	(197,592)	$	(46,918)
Undistributed net income available to unvested restricted stockholders	—		—		—		—
Net loss available to common stockholders—basic	(97,134)		(19,652)		(197,592)		(46,918)
Denominator:
Weighted average common shares outstanding—basic	63,573,658		63,121,400		63,519,444		63,029,597
Dilutive effect of shares issuable under stock options	—		—		—		—
Dilutive effect of RSUs	—		—		—		—
Dilutive effect of share-settled obligation	—		—		—		—
Dilutive effect of Notes, if converted(1)	—		—		—		—
Weighted average common shares outstanding—diluted	63,573,658		63,121,400		63,519,444		63,029,597
Net loss per share available to common stockholders—basic	$	(1.53)	$	(0.31)	$	(3.11)	$	(0.74)
Net loss per share available to common stockholders—diluted	$	(1.53)	$	(0.31)	$	(3.11)	$	(0.74)

__________

(1) As the Company recorded net losses in the three and six months ended July 2, 2022 and July 3, 2021, inclusion of shares from the conversion premium or spread would be anti-dilutive. The Company had $1.2 billion in Notes outstanding as of July 2, 2022.

Note 13. Related Party Transactions

In connection with the Company’s investment in TPP, a joint venture with PepsiCo, Inc., the Company sells certain products directly to the joint venture. In the three months ended July 2, 2022, the Company also entered into an agreement for a nonrefundable up-front fee associated with its manufacturing and supply agreement with TPP that will be recognized over the estimated term of the manufacturing and supply agreement. Net revenues earned from TPP included in U.S. retail channel net revenues were

BEYOND MEAT, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements (continued)

March 30, 2019 March 31, 2018
Convertible preferred stock (as converted) 41,562,111
39,474,156
Preferred stock warrants (as converted to common stock warrants and subsequently exercised) 160,767
160,767
Common stock warrants (as exercised) 60,002
—
Total 41,782,880
39,634,923
$15.9 million and $0 for the three months ended July 2, 2022 and July 3, 2021, respectively, and $26.6 million and $0 for the six months ended July 2, 2022 and July 3, 2021, respectively.

Accounts receivable from TPP were $12.0 million and $0 at July 2, 2022 and December 31, 2021, respectively. Current and long-term portions of the unrecognized revenue associated with the up-front fee charged to TPP as of July 2, 2022 were $0.9 million and $3.3 million, respectively, and included in "Accrued expenses and other current liabilities" and "Finance lease obligations and other long-term liabilities," respectively, in the Company's condensed consolidated balance sheet as of July 2, 2022. There were no such balances as of December 31, 2021.

Note 14. Subsequent Events

Subsequent to the quarter ended July 2, 2022, on July 27, 2022, the Company entered into an agreement to purchase certain real property on a neighboring site to its manufacturing facility in Europe located in Enschede, the Netherlands for cash consideration of approximately €6.3 million. The purchase is expected to close in the second half of 2023.

Subsequent to the quarter ended July 2, 2022, on August 3, 2022, the Company and Roquette Frères amended their agreement (“Amendment”) dated January 10, 2020 to extend it to December 31, 2023. Pursuant to the Amendment the purchase commitment was revised to purchase $16.2 million of pea protein in the remainder of 2022 and $40.2 million in 2023.

Subsequent to the quarter ended July 2, 2022, the Company contributed an additional $10.0 million as its share of the additional investment in TPP.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A, “Risk Factors,” of our 2021 10-K and Part II, Item ~~1A.~~1A, “Risk Factors” and ~~“ Note~~“Note Regarding Forward-Looking Statements” included ~~elsewhere~~ in this ~~report.~~report and those discussed in other documents we file from time to time with the SEC. The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the related notes and other financial information included ~~elsewhere~~ in this quarterly report and our audited consolidated financial statements and notes thereto included in our ~~final prospectus dated May 1, 2019 (the “Prospectus”) that forms a part~~2021 10-K. Our historical results are not necessarily indicative of the results to be expected for any future periods and our ~~Registration Statement on Form S-1 (File No. 333-228453), as filed with~~operating results for the ~~Securities~~three and ~~Exchange Commission (“SEC”) pursuant~~six months ended July 2, 2022 are not necessarily indicative of the results to ~~Rule 424 promulgated under~~be expected for the ~~Securities Act of 1933, as amended (the “Securities Act”), on May 3, 2019.~~fiscal year ending December 31, 2022 or for any other interim period or for any other future year or period.

Overview

Beyond Meat is ~~one of the fastest growing food companies in the United States,~~a leading plant-based meat company, offering a portfolio of revolutionary plant-based meats. We build meat directly from plants, an innovation that enables consumers to experience the taste, texture and other sensory attributes of popular animal-based meat products while enjoying the nutritional and environmental benefits of eating our plant-based meat products. Our brand commitment, ~~“Eat~~Eat What You Love,” represents a strong belief that ~~by eating~~there is a better way to feed our future and that the positive choices we all make, no matter how small, can have a great impact on our personal health and the health of our planet. By shifting from animal-based meat to plant-based ~~meats, consumers~~protein, we can ~~enjoy more, not less, of their favorite meals, and by doing so help address concerns related to~~positively impact four growing global issues: human health, climate change, ~~resource conservation,~~constraints on natural resources and animal welfare. The success of our breakthrough innovation model and products has allowed us to appeal to a broad range of consumers, including those who typically eat animal-based meats, positioning us to compete directly in the $1.4 trillion global meat industry.

We sell a range of plant-based meat products across the three main meat platforms of beef, pork and poultry. ~~They are offered~~As of June 2022, Beyond Meat branded products were available at approximately 183,000 retail and foodservice outlets in ~~ready-to-cook formats (primarily merchandised in~~more than 90 countries worldwide, across mainstream grocery, mass merchandiser, club store, convenience store, and natural retailer channels, and various food-away-from-home channels, including restaurants, foodservice outlets and schools.

The condensed consolidated financial statements for the ~~meat case), which we refer to as our “fresh” platform, and ready-to-heat formats (merchandised in~~period ended July 2, 2022 include the ~~freezer), which we refer to as our “frozen” platform.~~

On May 6, 2019, we completed our initial public offering (“IPO”) of common stock, in which we sold 11,068,750 shares, including 1,443,750 shares pursuant to the underwriters’ over-allotment option. The shares began trading on the Nasdaq Global Select Market on May 2, 2019. The shares were sold at an IPO price of $25.00 per share for net proceeds of approximately $252.5 million, after deducting underwriting discounts and commissions of $19.4 million and estimated offering expenses of approximately $4.8 million payable by us. Upon the closingaccounts of the ~~IPO, all outstanding shares of our convertible preferred stock automatically converted into 41,562,111 shares of common stock on a one-for-one basis,~~Company and ~~warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for 160,767 shares of common stock.~~its foreign subsidiaries, Beyond Meat EU B.V., BYND JX and Beyond Meat Canada Inc. All inter-company balances and transactions have been eliminated.

We operate on a fiscal calendar year, and each interim quarter is comprised of one 5-week period and two 4-week periods, with each week ending on a Saturday. Our fiscal year always begins on January 1 and ends on December 31. As a result, our first and fourth fiscal quarters may have more or fewer days included than a traditional 91-day fiscal quarter.

For the three months ended July 2, 2022, our retail and foodservice channels accounted for approximately 69.7% and 30.3% of our net revenues, respectively. For the three months ended July 3, 2021, our retail and foodservice channels accounted for approximately 70.8% and 29.2% of our net revenues, respectively. For the six months ended July 2, 2022, our retail and foodservice channels accounted for approximately 72.9% and 27.1% of our net revenues, respectively. For the six months ended July 3, 2021, our retail and foodservice channels accounted for approximately 72.5% and 27.5% of our net revenues, respectively.

For the three months ended July 2, 2022, our U.S. and international channels accounted for approximately 69.5% and 30.5% of our net revenues, respectively. For the three months ended July 3, 2021, our U.S. and international channels accounted for approximately 67.7% and 32.3% of our net revenues, respectively. For the six months ended July 2, 2022, our U.S. and international channels

accounted for approximately 72.5% and 27.5% of our net revenues, respectively. For the six months ended July 3, 2021, our U.S. and international channels accounted for approximately 70.5% and 29.5% of our net revenues, respectively.

In the three and six months ended July 2, 2022, net revenues from international foodservice channel sales increased while net revenues from international retail channel sales decreased as compared to the prior-year periods. Despite increased pounds of product sold, international net revenues decreased 7.2% and 7.1% in the three and six months ended July 2, 2022, respectively, as compared to the prior-year periods primarily due to decreased revenue per pound driven by recent pricing actions, a softening in the Euro vs the U.S. dollar and increased trade discounts.

In the three and six months ended July 2, 2022, U.S. retail channel net revenues increased as compared to the prior-year periods, partially offset by a decease in U.S. foodservice channel net revenues, resulting in a 1.1% and 2.4% increase in U.S. net revenues, respectively. However, this increase was more than offset by the decrease in international net revenues, resulting in a 1.6% and 0.4% decrease in net revenues in the three and six months ended July 2, 2022, respectively, as compared to the prior-year periods.

At July 2, 2022, our inventory balances increased 5% compared to the levels at December 31, 2021, due to increases in all the three categories of inventories. The increase in finished goods inventory includes the effect of higher capitalized direct labor and production overhead costs.

In addition to the impact of COVID-19 on our business discussed below under “Impact of COVID-19 on Our Business,” our net revenues, gross profit, gross margin, earnings and cash flows may be adversely impacted in 2022 by the following:

•changes in our product mix including the launch of new products (especially Beyond Meat Jerky), which may carry lower margin profiles relative to existing products due in part to early cost of production inefficiencies;

•weak demand in the retail channel due to slower category growth, particularly for refrigerated plant-based meat, and increased competitive activity, including the deceleration of plant-based meat across Europe and our ability to successfully launch extended shelf-life products;

•the impact of high inflation and the plant-based meat sector’s premium pricing relative to animal protein;

•our decreased revenue forecast negatively impacting capacity utilization, which could also give rise to termination fees to exit certain supply chain arrangements and/or the write-off of certain equipment, driving less leverage on fixed costs and delaying the speed at which cost savings initiatives impact our financial results;

•changes in forecast demand, particularly for Beyond Meat Jerky;

•effectively managing inventory levels, including sales to the liquidation channel and the level of inventory reserves;

•price reductions, primarily in the retail channel in Europe, intended to improve price competitiveness relative to competing products;

•increased unit cost of goods sold due to lower production volumes in response to weaker demand, which would adversely impact coverage of fixed production costs within our manufacturing facilities;

•increased unit cost of goods due to inflation, rising interest rates, higher transportation, raw materials, energy, labor and supply chain costs;

•increased promotional programs and trade discounts to our retail and foodservice customers, including to bolster support for our core lines, and shifts in product and channel mix resulting in negative impacts on our gross margins;

•potential disruption to our supply chain and the supply chain more generally caused by distribution and other logistical issues; and

•labor needs at the Company as well as in the supply chain and at customers.

In August 2022, we realigned our organizational structures across North America, the EU and China to increase regional focus, efficiency and speed.

Impact of COVID-19 on Our Business

The COVID-19 pandemic has had, and we expect will continue to have, certain negative impacts on our business. In response to the COVID-19 pandemic, governments and other authorities around the world implemented significant measures intended to control the spread of the virus, including social distancing measures, business closures or restrictions on operations, quarantines, lockdowns and travel bans. While some of these restrictions were lifted or eased in many jurisdictions as the rates of COVID-19 infections have decreased or stabilized and as various COVID-19 vaccines have become more widely available, a resurgence of COVID-19 and the impact of variants of the virus that causes COVID-19 in some markets, including China, has slowed the reopening process.

The COVID-19 pandemic continues to impact the global economy. We have established a cross-functional task force that meets regularly and continually monitors and tracks relevant data, including guidance from local, national and international health agencies. This task force works closely with our senior leadership and is instrumental in making critical, timely decisions and is committed to continuing to communicate to our employees as more information is available to share. In response to COVID-19, we have taken, and continue to take measures to support the health and safety of our employees as well as the communities in which we operate.

It is challenging to estimate the extent of the adverse impact of the COVID-19 pandemic on our results of operations due to continued uncertainty regarding the duration, spread and intensity of the COVID-19 pandemic. While the ultimate health and economic impact of COVID-19 continues to be highly uncertain, our business operations and results of operations, including our net revenues, gross profit, gross margin, earnings and cash flows, may be adversely impacted in 2022, including as a result of:

•variability of demand in the foodservice channel due to the ongoing impact of COVID-19, including the resurgence of COVID-19 and the appearance of variants of the virus, despite the resumption of customer traffic in some foodservice establishments;

•potential disruption or closure of our facilities or those of our suppliers or co-manufacturers due to employee contraction of COVID-19;

•potential shortages in raw materials caused by the conflict in Ukraine, COVID-19 lockdowns in China or other factors;

•the timing and success of strategic QSR partnership launches and resumption of any expansion plans for our product lines for those QSR customers who are in trial or test phase;

•reduced confidence by our foodservice partners due to the resurgence of COVID-19, as well as reimplementation of safety measures in certain jurisdictions and its potential impact on customer demand levels;

•further foodservice customer closures (including re-closures in connection with resurgences of COVID-19) or further reduced operations;

•our ability to introduce new foodservice products as QSR and other partners look to simplify menu offerings as a result of the pandemic;

•uncertainty in the length of recovery time for the U.S. and world economies; and

•disruptions in our ability to expand to new international locations.

Future events and effects related to COVID-19 cannot be determined with precision and actual results could significantly differ from estimates or forecasts.

Environmental, Social and Governance

As a disruptive leader in the food industry, we have established ourselves as a leading producer of plant-based meat products that deliver a reduced environmental footprint and mitigate the social and welfare issues inherent to the production and consumption of animal protein. In order to continue that work and position ourselves as a leader in the integration of environmental and social change, we have committed to developing a comprehensive ESG program. As part of the development of our ESG program, we have conducted a materiality analysis to determine which ESG issues are relevant to our business (“ESG Materiality Analysis”). The ESG Materiality Analysis was not designed to identify material issues for the purposes of financial reporting, or as defined by the securities laws of the United States. The environmental impacts of our products, climate change management, the safety and quality of the products we produce and how we manage our supply chain were all identified as highly relevant as a result of the ESG Materiality Analysis. We continue to work on leveraging the ESG Materiality Analysis to create comprehensive ESG goals that will assist us with our commitment to ensuring responsible and sustainable business practices within our organization.

Components of Our Results of Operations and Trends and Other Factors Affecting Our Business

Net Revenues

We generate net revenues primarily from sales of our products ~~including The Beyond Burger, Beyond Sausage and other plant-based meat products~~ to our customers ~~which include~~across mainstream grocery, mass merchandiser, club store, convenience store, and natural ~~retailers, as well as~~retailer channels and various food-away-from-home channels, including restaurants, ~~and other~~ foodservice outlets and schools, mainly in the United States.

We ~~have experienced substantial growth in~~present our net revenues ~~in the past three years.~~ by geography and distribution channel as follows:


Distribution Channel						Description
U.S. Retail						Net revenues from retail sales to the U.S. market and sales to our joint venture, the Planet Partnership, LLC
U.S. Foodservice						Net revenues from restaurant and foodservice sales to the U.S. market
International Retail						Net revenues from retail sales to international markets, including Canada
International Foodservice						Net revenues from restaurant and foodservice sales to international markets, including Canada

The following factors and trends in our business have driven net revenue growth over ~~this period~~prior periods and are expected to be key drivers of our net revenue growth ~~for~~over time, subject to the ~~foreseeable future:~~duration, magnitude and effects of COVID-19 and other challenges as discussed above:

•increased penetration across our retail channel, including mainstream grocery, mass merchandiser, club store, convenience store, and natural retailer ~~customers,~~channels, and our ~~restaurant and~~ foodservice channel, including ~~restaurants,~~increased desire by foodservice ~~outlets~~establishments, including large Full Service Restaurant and/or global QSR customers, to add plant-based products to their menus and ~~schools;~~to highlight these offerings;

~~increased velocity~~•the strength and breadth of our ~~fresh product~~partnerships with global QSR restaurants and retail and foodservice customers;

•distribution expansion, increased sales velocity, household penetration, repeat purchases, buying rates (amount spent per buyer) and purchase frequency across our ~~channels, by which we mean that the volume~~channels;

•increased international sales of our products ~~sold per outlet has generally increased period-over-period due~~across geographies, markets and channels as we continue to ~~greater adoption~~expand the breadth and depth of our international distribution and grow our numbers of international customers;

•our ability to accurately forecast demand for our ~~products;~~products and manage our inventory;

•our operational effectiveness and ability to fulfill orders in full and on time;

•our continued innovation and product commercialization, including enhancing existing products and introducing new products, such as Beyond Meatballs, Beyond Breakfast Sausage Patties, Beyond Breakfast Sausage Links, the latest iteration of our Beyond Burger and the recent launches of Beyond Chicken Tenders and Beyond Meat Jerky, across our plant-based platforms that appeal to a broad range of consumers, ~~including~~specifically those who typically eat animal-based meat;

~~impact of~~•enhanced marketing efforts as we continue to build our brand, amplify our value proposition around taste, health and sustainability, serve as a best-in-class partner to strategic and other QSR customers to support product development and category management, and drive consumer adoption of our ~~products;~~products, including for example, our billboard campaign, food truck tours in selected cities, our first Reddit AMA, our presence on TikTok, our NBA Twitter campaign during the NBA finals, mobile pop-ups in select U.S. cities to give consumers an exclusive first taste of our latest innovative products ahead of in-store availability, increased social media and digital activity to build consumer awareness and excitement, shopper marketing programs to incentivize consumer trial, and a robust Spotify podcast campaign around the launch of the latest iteration of our Beyond Burger;

•overall market trends, including ~~growing~~ consumer awareness and demand for nutritious, convenient and high protein plant-based ~~foods.~~foods; and

•increased production levels as we invest in production infrastructure and scale production to meet demand for our products across our distribution channels both domestically and internationally.

In addition to the factors and trends above, we expect the following to positively impact net revenues going ~~forward:~~forward, subject to the ultimate duration, magnitude and effects of the COVID-19 pandemic and other challenges discussed above:

~~increased~~•expansion of our own internal production ~~levels as~~facilities domestically and abroad to produce our woven proteins, blends of flavor systems and binding systems, and finished goods, while forming additional strategic relationships with co-manufacturers; and

•localized production and third-party partnerships to increase the availability and speed with which we ~~scale production to meet demand for~~can get our products ~~across our distribution channels both domestically and internationally, including Australia, Europe, Hong Kong, Israel, South Africa, South Korea and parts of the Middle East; and~~

~~increased desire by restaurant and foodservice establishments~~ to ~~add plant-based products to their menus and to highlight these offerings.~~

Net revenues from sales in our retail channel increased by 110.8% in the three months ended March 30, 2019 to $19.6 million from $9.3 million in the three months ended March 31, 2018. Net revenues from sales in our restaurant and foodservice channel increased by 491.4% in the three months ended March 30, 2019 to $20.6 million from $3.5 million in the three months ended March 31, 2018. We expect further growth in both channels as we increase our production capacity in response to demand.

We distribute our products internationally, using distributors in Australia, Chile, the European Union, Hong Kong, Ireland, Israel, the Middle East, New Zealand, South Korea, Taiwan and the United Kingdom. Our international net revenues in the three months ended March 30, 2019 and March 31, 2018 were approximately 14% and 1%, respectively, of our net revenues. All of our long-lived assets are in the United States and we have no long-lived assets in any international locations. Net revenues from sales to the Canadian market are included with net revenues from sales to the United States market.

Over the next few years, the main driver of growth in our net revenues is expected to be sales of our fresh products, primarily The Beyond Burger, in both our retail channel and our restaurant and foodservice channel predominantly in the United States, as well ascustomers internationally. We also expect net revenues and gross margin to benefit from increased sales of our fresh products due to the higher net selling price per pound of our fresh platform products compared to our frozen platform products.

As we seek to continue to ~~rapidly~~ grow our net revenues, we face several challenges. ~~In 2017, continuing into 2018, demand for~~The extent of COVID-19’s effect on our operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic (including any additional resurgences), impact of variants of the virus that causes COVID-19, the widespread distribution and public acceptance of the various COVID-19 vaccines and their efficacy against COVID-19 and variants of the virus, labor needs at the Company as well as in the supply chain and at customers, compliance with government or employer COVID-19 vaccine mandates and the resulting impact on available labor, and the level of social and economic restrictions imposed on the United States and abroad in an effort to curb the spread of the virus, and the impact on consumer behavior, all of which are uncertain and difficult to predict considering the rapidly evolving landscape. For example, the impact of COVID-19 on any of our suppliers, co-manufacturers, distributors or transportation or logistics providers may negatively affect the price and availability of our ingredients and/or packaging materials and impact our supply chain. Labor shortages at retail and foodservice customers may impact our ability to launch new products ~~exceeded our expectations and~~or planned promotions, or may have other negative effects on customer demand. Additionally, if we are forced to scale back hours of production ~~capacity, significantly constraining our net revenue growth relative to our total demand opportunity. While we have significantly expanded~~or close our production ~~capacity~~facilities or our Manhattan Beach Project Innovation Center in response to ~~address production shortfall,~~the pandemic, we ~~may experience a lag in production relative to customer demand if~~expect our business, financial condition and results of operations would be materially adversely affected. In addition, our growth ~~rate exceeds~~strategy to expand our ~~expectations.~~operations internationally may be impeded. The uncertainty created by COVID-19 significantly increases the difficulty in forecasting operating results and strategic planning. As a result, it is not currently possible to ascertain the overall impact of COVID-19 on our business, results of operations, financial condition or liquidity. However, the pandemic has had, and we expect may continue to have, a material adverse impact on our business, results of operations, financial condition and cash flows and may adversely impact the trading price of our

common stock. Future events and effects related to the COVID-19 pandemic cannot be determined with precision and actual results could significantly differ from estimates or forecasts.

We routinely offer sales discounts and promotions through various programs to customers and consumers. These programs include rebates, temporary on-shelf price reductions, off-invoice discounts, retailer advertisements, product coupons and other trade activities. We anticipate that we will need to continue to offer more trade and promotion discounts to both our retail and foodservice customers, to drive increased consumer trial, in response to COVID-19 and in response to increased competition and pressure on the plant-based meat category. The expense associated with these discounts and promotions is estimated and recorded as a reduction in total gross revenues in order to arrive at reported net revenues. At the end of each accounting period, we recognize a contra asset to “Accounts receivable” for estimated sales discounts that have been incurred but not paid which totaled $5.2 million and $3.6 million as of July 2, 2022 and December 31, 2021, respectively. We expect to face increasing competition across all channels, especially as additional plant-based protein product brands continue to enter the marketplace and as consumers trade down among proteins in the context of significant inflationary pressures. In response, we anticipate ~~that~~providing heavier discounting and promotions on some of our products. Although these ~~promotional activities could~~actions are intended to build brand awareness and increase consumer trials of our products, they have had and are likely to continue to have a negative impact on our net revenues, gross margins and ~~that changes in such activities could impact~~profitability, impacting period-over-period results.

In addition, because we do not have any purchase commitments from our distributors or customers, the amount of net revenues we recognize will vary from period to period depending on the volume, ~~and mix of our products sold, particularly between products in our fresh and frozen platforms,~~timing and the channels through which our products are sold, and the impact of customer orders ahead of holidays, causing variability in our results. Similarly, the timing of retail shelf resets are not within our control, and to the extent that retail customers change the timing of such events, variability of our results may also increase. Lower customer orders ahead of holidays, shifts in customer shelf reset activity and changes in the order patterns of one or more of our large retail customers could cause a significant fluctuation in our quarterly results and could have a disproportionate effect on our results of operations for the entire fiscal year.

Our financial performance also depends on our operational effectiveness and ability to fulfill orders in full and on time. For example, in the third quarter of 2021 we experienced challenges in operations that led to unfulfilled orders, primarily due to severe weather resulting in the temporary loss of potable water in one Pennsylvania facility and water damage to inventory in another.

Further, we may not be able to recapture missed opportunities in later periods, for example if the opportunity related to a significant grilling holiday like Memorial Day weekend, the Fourth of July, or Labor Day weekend. Missed opportunities may also result in missing subsequent additional opportunities. Internal and external operational issues therefore may impact the amount and variability of our results.

Seasonality

Generally, we expect to experience greater demand for certain of our products during the summer grilling season. In 2022, U.S. retail channel net revenues during the second quarter were 16% higher than the first quarter. In 2021, U.S. retail channel net revenues during the second quarter were 21% higher than the first quarter. We continue to see additional seasonality effects, especially within our retail channel, with revenue contribution from this channel tending to be greater in the second and third quarters of the year, along with increased levels of purchasing by customers ahead of holidays, the impact of customer shelf reset activity and the timing of product restocking by our retail customers. In an environment of uncertainty from the impact of COVID-19, inflationary pressures and other factors impacting our business, we are unable to assess the ultimate impact on the demand for our products as a result of seasonality.

Gross Profit

Gross profit consists of our net revenues less cost of goods sold. Our cost of goods sold primarily consists of the cost of raw materials and ingredients for our products, direct and indirect labor and certain supply costs, co-manufacturing fees, in-bound and internal shipping and handling costs incurred in manufacturing our products, warehouse storage fees, plant and equipment overhead, depreciation and amortization expense, ~~as well as the~~ cost of packaging our ~~products.~~products, as well as inventory write-offs and reserves. In ~~order to keep pace with demand,~~anticipation of future growth, we have had to very quickly scale production and ~~we have not always been able to meet all demand for our products. As a result, we have had to quickly~~ expand our sources of supply for our core protein inputs such as pea protein. ~~Our growth has also significantly increased facility and warehouse utilization rates.~~

We ~~intend to continue to increase our production capabilities at our two in-house manufacturing facilities in Columbia, Missouri. As a result, we~~ expect our cost of goods sold ~~to increase~~ in absolute dollars to ~~support our growth. However, we expect such expenses to decrease~~increase as a ~~percentage~~result of ~~net revenues over time as~~anticipated growth in our sales volume.

Subject to the ultimate duration, magnitude and effects of COVID-19, inflationary pressures and other factors impacting our business, we continue to ~~scale~~expect that gross profit improvements will be delivered primarily through improved volume leverage and throughput, reduced manufacturing conversion costs, greater internalization and geographic localization of our ~~business.~~

Gross margin improved by 10.7 points to 26.8% in the three months ended March 30, 2019 from 16.1% in the three months ended March 31, 2018. Gross margin benefited from an increase in the amount of product sold, improvedmanufacturing footprint and finished goods, materials and packaging input cost reductions, tolling fee efficiencies, end-to-end production ~~efficiencies and from~~processes across a greater proportion of ~~revenues from products~~our manufacturing network, scale-driven efficiencies in ~~our fresh platform which have a higher net selling price per pound. As we continue to expand production~~procurement and ~~are able to increase manufacturing efficiency and leverage the~~fixed cost absorption, diversification of our ~~fixed production~~core protein ingredients, product and ~~staff costs, we expect~~process innovations and reformulations, cost-down initiatives through ingredient and process innovation and improved supply chain logistics and distribution costs. We are also working to ~~substantially increase our gross margin. We also expect to continue to increase~~improve gross margin through ingredient cost savings achieved through scale of purchasing and through ~~expanding our co-manufacturing network and~~ negotiating lower tolling fees. We intend to pass some of these cost savings on to the consumer as we pursue our goal to achieve price parity with animal protein in at least one of our product categories by the end of 2024.

Margin improvement may, however, continue to be negatively impacted by our focus on investing heavily in our business, including launching new products with manufacturing processes that may initially be inefficient, establishing infrastructure in the U.S., EU and China, investing in personnel, partnerships and product pipeline, investing in our facilities, growing our customer base, volume deleveraging, aggressive pricing strategies and increased discounting, increased sales to the liquidation channel and inventory reserves, our product and customer mix, expanding into new geographies and markets, enhancing our production infrastructure, improving our innovation capabilities, enhancing our product offerings and increasing consumer engagement to apply increasing pressure on the three key levers of taste, health and cost that we believe are critical for mass adoption. Margin improvement may also be negatively impacted by the impact of lower demand forecast, inflation, increasing labor costs, materials costs and transportation costs.

Operating Expenses

Research and Development Expenses

Research and development expenses consist primarily of personnel and related expenses for our research and development staff, including salaries, benefits, bonuses, share-based compensation, scale-up expenses, and ~~share-based compensation.~~depreciation and amortization expense on research and development assets. We are beginning to incur research and development expenses in the form of rent associated with our new Commerce, California commercialization center. Design work for the build out of the commercialization center is underway, however, we have currently delayed the anticipated commencement of operations. Our research and development efforts are focused on enhancements to our product formulations and production processes in addition to the development of new products. We expect to continue to invest substantial amounts in research and development, as ~~most recently evidenced in the build-out of our state-of-the-art Manhattan Beach Project Innovation Center. Research~~research and development and innovation are core elements of our business strategy, asand we believe they represent a critical competitive advantage for us. We believe that we need to continue to rapidly innovate in order to ~~be able to~~ continue to capture a larger market share of consumers who typically eat animal-based meats. WeOver time and subject to the duration, magnitude and effects of the COVID-19 pandemic, inflationary pressures and other factors impacting our business, we expect these expenses to increase ~~somewhat~~ in absolute dollars, but to decrease as a percentage of net revenues as we continue to scale ~~production.~~production volume.

SG&A Expenses

SG&A expenses consist primarily of selling, marketing ~~selling~~ and administrative expenses, including personnel and related expenses, share-based compensation, outbound shipping and handling costs, non-manufacturing ~~rent~~lease expense, depreciation and amortization expense on non-manufacturing assets, consulting fees and other ~~miscellaneous~~non-production operating ~~items.~~expenses. Marketing and selling expenses include advertising costs, share-based compensation awards to brand ambassadors, costs associated with consumer promotions,

product samples and sales aids incurred to acquire new customers, retain existing customers and build our brand awareness. Administrative expenses include ~~the~~ expenses related to management, accounting, legal, IT, and other office functions.

We expect SG&A expenses for the remainder of 2022 to decrease from the levels in the first half of 2022, as we focus on reducing and optimizing non-people expenses. On August 3, 2022, we announced a reduction-in-force affecting approximately 4% of our global workforce. The reduction-in-force is expected to result in total annualized savings of approximately $8 million, excluding one-time separation costs of approximately $1 million, which we expect to incur in the third quarter of 2022.

Over time, our administrative expenses are generally expected to increase in absolute dollars ~~as we increase our domestic and international expansion efforts to meet our product demand and incur costs related to our status as a public company.~~

Our selling and marketing expense is expected to increase, both through a greater focus on marketing and through additions to our sales organizations. We expect to significantly expand our marketing efforts to achieve greater brand awareness, attract new customers and increase market penetration. We have historically had a very small sales force, with only nine full-time sales employees as of December 31, 2017 growing to 22 full-time sales employees as of March 30, 2019. As we continue to grow, we expect to expand our sales force to address additional opportunities, which could substantially increase our selling expense. Our administrative expenses are expected to increase as a public company with increased personnel ~~cost in~~to support various functions, including among others, operations and supply chain, accounting, finance, legal, IT and compliance-related ~~expenses.~~functions, but to decrease as a percentage of net revenues.

Restructuring Expenses

In May 2017, management approved a plan to terminate an exclusive supply agreement with one of our co-manufacturers. ~~See “—Results of Operations—Three Months Ended March 30, 2019 Compared to Three Months ended March 31, 2018—Restructuring Expenses” for~~For a discussion of these ~~expenses.~~

~~Other, Net~~

~~Other, net includes expense primarily associated with the remeasurement of our preferred stock warrant liability~~expenses, see Note 3, Restructuring, and ~~common stock warrant liability prior~~Note 10, Commitments and Contingencies, to the ~~IPO. On May 6, 2019, upon completion of the IPO, the warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for common stock. Subsequent~~Notes to ~~the closing of the IPO, all outstanding warrants to purchase shares of common stock were exercised by surrendering shares of common stock towards the exercise price.~~Unaudited Condensed Consolidated Financial Statements, included elsewhere in this report.

~~Loss from Operations~~

Loss from operations in the first quarter of 2019 was $5.3 million compared to a loss of $5.6 million in the first quarter of the prior year. This improvement was driven entirely by the year-over-year increase in gross profit, partially offset by higher operating expenses as the Company continues to invest in its internal research and development and marketing capabilities and incur higher absolute costs to support its expanded manufacturing and supply chain operations.

~~Net Loss~~

Net loss was $6.6 million in the first quarter of 2019 compared to a net loss of $5.7 million in the prior-year period. The expanded net loss was primarily the result of higher operating expenses, higher interest expense as well as an increase in other non-operating expenses, a majority of which were related to mark-to-market adjustments on outstanding warrants, partially offset by the increase in gross profit.

Results of Operations

The following table sets forth selected items in our condensed consolidated statements of operations for the respective periods presented:


	Three Months Ended				Six Months Ended
(in thousands)	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Net revenues	$	147,040	$	149,426	$	256,495	$	257,590
Cost of goods sold	153,202		102,074		262,467		177,530
Gross (loss) profit	(6,162)		47,352		(5,972)		80,060
Research and development expenses	16,202		13,823		35,880		29,748
Selling, general and administrative expenses	63,015		48,286		138,129		87,240
Restructuring expenses	4,302		3,844		7,328		6,318
Total operating expenses	83,519		65,953		181,337		123,306
Loss from operations	$	(89,681)	$	(18,601)	$	(187,309)	$	(43,246)

Three Months Ended
(in thousands) March 30,
2019 March 31,
2018
Net revenues $ 40,206
$ 12,776
Cost of goods sold 29,435
10,719
Gross profit 10,771
2,057
Research and development expenses 4,498
1,605
Selling, general and administrative expenses 11,177
5,737
Restructuring expenses 394
294
Total operating expenses 16,069
7,636
Loss from operations $ (5,298 ) $ (5,579 )

The following table presents selected items in our condensed consolidated statements of operations as a percentage of net revenues for the ~~respective~~ periods presented:


	Three Months Ended				Six Months Ended
	July 2, 2022		July 3, 2021		July 2, 2022		July 3, 2021
Net revenues	100.0	%	100.0	%	100.0	%	100.0	%
Cost of goods sold	104.2		68.3		102.3		68.9
Gross (loss) profit	(4.2)		31.7		(2.3)		31.1
Research and development expenses	11.0		9.3		14.0		11.5
Selling, general and administrative expenses	42.9		32.3		53.9		33.9
Restructuring expenses	2.9		2.6		2.9		2.5
Total operating expenses	56.8		44.2		70.8		47.9
Loss from operations	(61.0)	%	(12.5)	%	(73.1)	%	(16.8)	%

Three Months Ended
March 30,
2019 March 31,
2018
Net revenues 100.0 % 100.0 %
Cost of goods sold 73.2
83.9
Gross profit 26.8
16.1
Research and development expenses 11.2
12.6
Selling, general and administrative expenses 27.8
44.9
Restructuring expenses 1.0
2.3
Total operating expenses 40.0
59.8
Loss from operations (13.2 )% (43.7 )%

Three and Six Months Ended ~~March 30, 2019~~July 2, 2022 Compared to Three and Six Months Ended ~~March 31, 2018~~July 3, 2021 (unaudited)

Net Revenues

Three Months Ended Change
(in thousands) March 30,
2019 March 31,
2018 Amount Percentage
Net revenues:
Fresh Platform $ 38,806
$ 9,596
$ 29,210
304.4 %
Frozen Platform 4,512
4,748
(236 ) (5.0 )%
Less: Discounts (3,112 ) (1,568 ) (1,544 ) 98.5 %
Net revenues $ 40,206
$ 12,776
$ 27,430
214.7 %

Three Months Ended Change
(in thousands) March 30,
2019 March 31,
2018 Amount Percentage
Net revenues:
Retail $ 19,579
$ 9,288
$ 10,291
110.8 %
Restaurant and Foodservice 20,627
3,488
17,139
491.4 %
Net revenues $ 40,206
$ 12,776
$ 27,430
214.7 %

Net revenues ~~increased~~decreased by ~~$27.4~~$2.4 million, or ~~214.7%~~1.6%, in the three months ended ~~March 30, 2019~~July 2, 2022, as compared to the prior-year period primarily due to ~~strong growth~~a decrease in ~~sales volumes~~net revenue per pound of products in our fresh platform across both our retail and our restaurant and foodservice channels, driven by expansion in the number of retail and foodservice points of distribution, including new strategic customers, and greater demand from our existing customers,approximately 14.2%, partially offset by a 14.6% increase in total pounds sold. The decrease in net ~~revenues from~~revenue per pound was primarily attributable to changes in price, including the ~~frozen platform. We discontinued our frozen chicken strips product line during~~impact of sales to liquidation channels and list price reductions in the EU implemented in the first quarter of ~~2019, causing~~2022, changes in foreign exchange rates, and increased trade discounts.

The following table presents our net revenues by channel in the three months ended July 2, 2022 as compared to the prior-year period:


	Three Months Ended				Change
(in thousands)	July 2, 2022		July 3, 2021		Amount		%
U.S.:
Retail	$	78,861	$	77,195	$	1,666	2.2	%
Foodservice	23,389		23,961		(572)		(2.4)	%
U.S. net revenues	102,250		101,156		1,094		1.1	%
International:
Retail	23,692		28,544		(4,852)		(17.0)	%
Foodservice	21,098		19,726		1,372		7.0	%
International net revenues	44,790		48,270		(3,480)		(7.2)	%
Net revenues	$	147,040	$	149,426	$	(2,386)	(1.6)	%

Net revenues from U.S. retail channel sales in the three months ended July 2, 2022 increased $1.7 million, or 2.2%, primarily due to sales to TPP of Beyond Meat Jerky introduced in the first quarter of 2022, which contributed $15.9 million in net revenues, and, to a ~~decline~~lesser extent, by chicken products including Beyond Chicken Tenders, partially offset by decreases in ~~frozen product revenues consistent with our shift to concentrate more on our fresh products platform.~~

~~Revenues from~~ sales of other products. Beyond Meat branded products were available at approximately 78,000 U.S. retail outlets as of June 2022.

Net revenues from U.S. foodservice channel sales in ~~our fresh platform increased $29.2~~the three months ended July 2, 2022 decreased $0.6 million, or ~~304.4%~~2.4%, primarily due to discontinued distribution at a certain customer which was included in the year-ago period, partially offset by increases in sales of Beyond Sausage and chicken products including Beyond Chicken Tenders. Beyond Meat branded products were available at approximately 41,000 U.S. foodservice outlets as of June 2022.

Net revenues from international retail channel sales in the three months ended July 2, 2022 decreased $4.9 million, or 17.0%, primarily driven by a 21.7% decrease in net revenue per pound, partially offset by a 6.0% increase in pounds sold. The decrease in net revenue per pound was primarily due to list price reductions in the EU, unfavorable foreign exchange rate impact and increased trade discounts. By product, the decrease in sales was primarily due to decreases in sales of Beyond Sausage and Beyond Beef. Beyond Meat branded products were available at approximately 33,000 international retail outlets as of June 2022.

Net revenues from international foodservice channel sales in the three months ended July 2, 2022 increased $1.4 million, or 7.0%, primarily due to a 37.5% increase in pounds sold, partially offset by a 22.2% decrease in net revenue per pound due to changes in sales mix, unfavorable foreign exchange rate impact and increased trade discounts. By product, the increase in sales was primarily due to increases in sales of ~~The~~ Beyond Burger and chicken products including Beyond ~~Sausage. Net revenues from retail sales increased $10.3 million, or 110.8%, primarily due to increase in sales of The~~Chicken Tenders. Beyond ~~Burger. Net revenues from sales through our restaurant and foodservice channel increased $17.1 million, or 491.4%, primarily due to increases in sales of The Beyond Burger, which was being served in~~Meat branded products were available at approximately ~~12,000 restaurant and~~31,000 international foodservice outlets as of ~~April 22, 2019, and due to increased sales of Beyond Sausage.~~June 2022.

~~The following tables present volume of our products sold in pounds:~~

Three Months Ended Change
(in thousands) March 30,
2019 March 31,
2018 Amount Percentage
Retail:
Fresh Platform 2,627
860
1,767
205.5 %
Frozen Platform 599
761
(162 ) (21.3 )
Total 3,226
1,621
1,605
99.0 %

Three Months Ended Change
(in thousands) March 30,
2019 March 31,
2018 Amount Percentage
Restaurant and Foodservice:
Fresh Platform 3,296
477
2,819
591.0 %
Frozen Platform 316
174
142
81.6
Total 3,612
651
2,961
454.8 %

~~Cost of Goods Sold~~

Three Months Ended Change
(in thousands) March 30,
2019 March 31,
2018 Amount Percentage
Cost of goods sold $ 29,435
$ 10,719
$ 18,716
174.6 %

~~Total cost of goods sold increased~~Net revenues decreased by ~~$18.7~~$1.1 million, or ~~174.6%~~0.4%, in the ~~three~~six months ended ~~March 30, 2019~~July 2, 2022, as compared to the prior-year period, primarily due to a decrease in net revenue per pound of approximately 12.3%, partially offset by a 13.7% increase in total pounds sold. The decrease in net revenue per pound was primarily attributable to changes in sales mix, price, including the impact of sales to liquidation channels and list price reductions in the EU implemented in the first quarter of 2022, increased trade discounts, and changes in foreign exchange rates.

The following table presents our net revenues by channel in the six months ended July 2, 2022 as compared to the prior-year period:


	Six Months Ended				Change
(in thousands)	July 2, 2022		July 3, 2021		Amount		%
U.S.:
Retail	$	147,121	$	141,021	$	6,100	4.3	%
Foodservice	38,882		40,703		(1,821)		(4.5)	%
U.S. net revenues	186,003		181,724		4,279		2.4	%
International:
Retail	39,829		45,743		(5,914)		(12.9)	%
Foodservice	30,663		30,123		540		1.8	%
International net revenues	70,492		75,866		(5,374)		(7.1)	%
Net revenues	$	256,495	$	257,590	$	(1,095)	(0.4)	%

Net revenues from U.S. retail channel sales in the six months ended July 2, 2022 increased $6.1 million, or 4.3%, as compared to the six months ended July 3, 2021. The increase in U.S. retail channel net revenues was primarily due to sales to TPP of Beyond Meat Jerky introduced in the first quarter of 2022, which contributed $26.6 million in net revenues, and, to a lesser extent, by chicken products including Beyond Chicken Tenders, partially offset by decreases in sales of other products.

Net revenues from U.S. foodservice channel sales in the six months ended July 2, 2022 decreased $1.8 million, or 4.5%, primarily due to higher trade discounts. By product, the decrease in sales was

primarily due to a decrease in sales of Beyond Breakfast Sausage, partially offset by increased sales of Beyond Sausage and chicken products including Beyond Chicken Tenders.

Net revenues from international retail channel sales in the six months ended July 2, 2022 decreased $5.9 million, or 12.9%, primarily driven by a 21.6% decrease in net revenue per pound, partially offset by an 11.1% increase in pounds sold. The decrease in net revenue per pound was due to list price reductions in the EU, increased trade discounts, unfavorable foreign exchange rate impact and changes in sales mix. By product, the decrease in sales was primarily due to decreases in sales of Beyond Sausage, Beyond Burger and Beyond Beef, partially offset by increases in sales of Beyond Meatballs and Beyond Breakfast Sausage.

Net revenues from international foodservice channel sales in the six months ended July 2, 2022 increased $0.5 million, or 1.8%, primarily due to a 34.5% increase in pounds sold, partially offset by a 24.3% decrease in net revenue per pound due to changes in sales mix, increased trade discounts and unfavorable foreign exchange rate impact. By product, the increase in sales was primarily due to increases in sales of Beyond Burger and chicken products including Beyond Chicken Tenders.

The following table presents total pounds sold by channel for the ~~sales volume~~periods presented:


	Three Months Ended		Change			Six Months Ended		Change
(in thousands)	July 2, 2022	July 3, 2021	Amount	%		July 2, 2022	July 3, 2021	Amount	%

U.S.:
Retail	16,057	13,834	2,223	16.1	%	28,510	24,962	3,548	14.2	%
Foodservice	3,965	4,002	(37)	(0.9)	%	6,717	6,884	(167)	(2.4)	%
International:
Retail	5,061	4,775	286	6.0	%	8,591	7,734	857	11.1	%
Foodservice	5,042	3,666	1,376	37.5	%	7,623	5,669	1,954	34.5	%
Total pounds sold	30,125	26,277	3,848	14.6	%	51,441	45,249	6,192	13.7	%

Cost of ~~our products.~~Goods Sold


	Three Months Ended				Change				Six Months Ended				Change
(in thousands)	July 2, 2022		July 3, 2021		Amount		%		July 2, 2022		July 3, 2021		Amount		%
Cost of goods sold	$	153,202	$	102,074	$	51,128	50.1	%	$	262,467	$	177,530	$	84,937	47.8	%

Cost of goods sold increased by $51.1 million, or 50.1%, to $153.2 million, in the three months ended July 2, 2022 as compared to the prior-year period. Cost of goods sold as a percentage of net revenues in the three months ended July 2, 2022 increased to 104.2% from 68.3% of net revenues in the prior-year period. The increase in cost of goods sold was primarily due to increased cost per pound and increased pounds sold compared to the prior-year period. The increase in cost per pound was primarily driven by increases in manufacturing costs including depreciation, materials costs, logistics costs and inventory write-offs and reserves. The introduction of Beyond Meat Jerky in the first quarter of 2022 negatively impacted cost per pound in the three months ended July 2, 2022 compared to the prior-year period. The decrease in revenue per pound in the three months ended July 2, 2022 compared to the prior-year period also had the effect of increasing cost of goods sold as a percentage of net revenues.

Cost of goods sold increased by $84.9 million, or 47.8%, to $262.5 million, in the six months ended July 2, 2022 as compared to the prior-year period. As a percentage of net revenues, cost of goods sold in

the six months ended July 2, 2022 increased to 102.3% from 68.9% of net revenues in the prior-year period. The increase in cost of goods sold was due to increased cost per pound and increased pounds sold compared to the prior-year period. The increase in cost per pound was due to manufacturing costs including depreciation, increased materials costs, increased logistics costs and increased inventory write-offs and reserves. The introduction of Beyond Meat Jerky in the first quarter of 2022 negatively impacted cost per pound in the six months ended July 2, 2022 compared to the prior-year period. The decrease in revenue per pound in the six months ended July 2, 2022 compared to the prior-year period also had the effect of increasing cost of goods sold as a percentage of net revenues.

Gross Profit and Gross Margin


	Three Months Ended						Change						Three Months Ended		Change		Six Months Ended		Change
(in thousands)	March 30, 2019			March 31, 2018			Amount			Percentage		(in thousands)	July 2, 2022	July 3, 2021	Amount	%	July 2, 2022	July 3, 2021	Amount	%
Gross profit	$	10,771		$	2,057		$	8,714		423.6	%
Gross (loss) profit												Gross (loss) profit	$(6,162)	$47,352	$(53,514)	(113.0)%	$(5,972)	$80,060	$(86,032)	(107.5)%
Gross margin	26.8		%	16.1		%	10.7		%	N/A		Gross margin	(4.2)%	31.7%	(3,590) bps	N/A	(2.3)%	31.1%	(3,340) bps	N/A

Gross profit in the three months ended ~~March 30, 2019~~July 2, 2022 was ~~$10.8~~a loss of $6.2 million as compared to gross profit of ~~$2.1~~$47.4 million in the prior-year period, a decrease of $53.5 million. Gross margin in the three months ended July 2, 2022 decreased to a negative gross margin of (4.2)% from a positive gross margin of 31.7% in the prior-year period. Despite a 14.6% increase in total pounds sold, gross profit and gross margin decreased primarily as a result of increased costs per pound of approximately $1.20 and decreased net revenue per pound of approximately $0.81 in the three months ended July 2, 2022 versus the prior-year period. Included in the cost and revenue per pound impacts were the impact of sales through the liquidation channel and sales of Beyond Meat Jerky. The inventory associated with the liquidation channel sales carried a cost of approximately $10.5 million and we realized revenue of approximately $1.9 million and a loss of approximately $8.7 million on the transaction. Additionally, we estimate Beyond Meat Jerky, which was introduced in the first quarter of 2022, contributed a gross profit loss of approximately $7.7 million in the three months ended ~~March 31, 2018, an improvement~~July 2, 2022.

Gross profit in the six months ended July 2, 2022 was a loss of ~~$8.7~~$6.0 million as compared to gross profit of $80.1 million in the prior-year period, a decrease of $86.0 million. ~~The improvement~~Gross margin in the six months ended July 2, 2022 decreased to a negative gross margin of (2.3)% from a positive gross margin of 31.1% in the prior-year period. Despite a 13.7% increase in total pounds sold, gross profit and gross margin ~~was~~decreased primarily ~~due to an increase in the amount~~as a result of products sold, with resulting operating leverage, and improved production efficiencies. The greater proportion of product revenues from our fresh platform also contributed to the improvement in gross margin, due to a higher net selling priceincreased costs per pound of ~~products~~approximately $1.18 and decreased net revenue per pound of approximately $0.71 in ~~our fresh versus frozen platform.~~ the six months ended July 2, 2022 compared to the prior-year period. Sales of Beyond Meat Jerky and sales into the liquidation channel were both headwinds to gross profit compared to the prior-year period.

We include outbound shipping and handling costs within SG&A expenses. As a result, our gross profit and gross margin may not be comparable to other entities that present ~~all~~ shipping and handling costs as a component of cost of goods sold.

Research and Development Expenses

Research and development expenses increased ~~$2.9~~$2.4 million, or ~~180.2%~~17.2%, in the three months ended ~~March 30, 2019~~July 2, 2022, as compared to the prior-year period. Research and development expenses increased to 11.0% of net revenues in the three months ended July 2, 2022 from 9.3% of net revenues in the prior-year period primarily due to ~~86%~~ higher headcount and higher scale-up expenses compared to the prior-year period.

Research and ~~depreciation~~development expenses increased $6.1 million, or 20.6%, in the six months ended July 2, 2022, as compared to the prior-year period. Research and ~~amortization expense.~~development expenses increased to 14.0% of net revenues in the six months ended July 2, 2022 from 11.5% of net revenues in the prior-year period primarily due to higher headcount and higher new product scale-up expenses compared to the prior-year period.

SG&A expenses increased ~~by $5.4~~$14.7 million, or ~~94.8%~~30.5%, in the three months ended ~~March 30, 2019 as compared~~July 2, 2022 to 42.9% of net revenues in the three months ended July 2, 2022, from 32.3% of net revenues in the prior-year period. The increase in SG&A expenses was primarily due to ~~$3.0~~$6.4 million in higher salaries and related expenses resulting from higher headcount, $4.2 million in higher consulting fees, $2.8 million in higher advertising costs, $2.3 million in higher share-based compensation expense, $1.2 million in increased marketing costs and $1.0 million in higher travel-related costs, partially offset by $0.7 million in lower outbound freight costs.

SG&A expenses increased $50.9 million, or 58.3%, in the six months ended July 2, 2022 to 53.9% of net revenues in the six months ended July 2, 2022, from 33.9% of net revenues in the prior-year period. The increase in SG&A expenses was primarily due to ~~a 90% increase~~$14.4 million in higher salaries and related expenses resulting from higher headcount, ~~$0.7~~$12.7 million in higher advertising costs, $8.5 million in higher marketing ~~service~~ expenses, ~~$0.7~~$6.7 million in higher consulting ~~and professional~~ fees, ~~$0.4~~$4.3 million in higher ~~supply chain expenses, $0.3~~share-based compensation expense, $2.0 million in outbound freight costs, $1.7 million in higher ~~outbound freight expenses,~~product donation costs, and ~~$0.3~~$1.7 million in ~~higher broker~~travel and related costs, partially offset by $0.8 million in lower product commissions.

Restructuring Expenses

As a result of the termination in May 2017 of an exclusive supply agreement with one of our co- manufacturers due to non-performance under the agreement, we recorded restructuring expenses of ~~$0.4~~$4.3 million and ~~$0.3~~$3.8 million in the three months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018,~~July 3, 2021, respectively, and $7.3 million and $6.3 million in the six months ended July 2, 2022 and July 3, 2021, respectively. The restructuring expenses were primarily related to legal and other expenses associated with the dispute. As

of ~~March 30, 2019~~July 2, 2022 and December 31, ~~2018,~~2021, there were no$2.2 million and $2.7 million, respectively, in accrued and unpaid ~~liabilities associated with this contract termination, although we~~restructuring expenses. We continue to incur legal fees and other costs in connection with our ongoing efforts to resolve this dispute. See Note 3, Restructuring, and Note 10, Commitments and Contingencies to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in ~~Part I, Item 1 of this report and~~ ~~Legal Proceedings~~ ~~in Part II, Item 1 of~~ this report.

~~Income Tax Expense~~Loss from Operations

~~For~~Loss from operations in the three months ended ~~March 30, 2019~~July 2, 2022 was $89.7 million compared to $18.6 million in the prior-year period. The increase in loss from operations in the three months ended July 2, 2022 was primarily driven by lower gross profit, growth in non-production headcount expenses, increased general and ~~March 31, 2018 we recorded no income tax~~administrative expenses driven by ongoing consulting agreements, greater investment in marketing activities, higher expenses associated with production trial activities, and increased investments in innovation compared to the prior-year period.

Loss from operations in the six months ended July 2, 2022 was $187.3 million compared to $43.2 million in the prior-year period. The increase in loss from operations in the six months ended July 2, 2022 was primarily driven by lower gross profit, growth in non-production headcount expenses, higher advertising costs, higher marketing-related expenses, higher consulting expenses, increased production trial activities and higher share-based compensation expense compared to the prior-year period.

Total Other Expense, net

Total other expense, net in ~~our condensed statements~~the three months ended July 2, 2022 of ~~operations. No tax benefit was provided for~~$6.0 million included approximately $5.5 million in realized and unrealized foreign currency transaction losses ~~incurred because those losses are~~due to unfavorable changes in foreign exchange rates of the Euro and Chinese Yuan and $1.0 million in interest expense from the amortization of convertible debt issuance costs, partially offset by ~~a full valuation allowance.~~$0.6 million in interest income. Total other expense of $0.8 million in the prior-year period consisted of $1.0 million in interest expense on our debt balances, partially offset by $0.2 million in foreign currency transaction gains and $0.2 million in subsidies received from the Jiaxing Economic Development Zone Finance Bureau for our investment in BYND JX.

~~Generally, we expect~~Total other expense, net in the six months ended July 2, 2022 of $8.2 million consisted primarily of $6.6 million in realized and unrealized foreign currency transaction losses due to ~~experience greater demand for certain~~unfavorable changes in foreign exchange rates of the Euro and Chinese Yuan and $2.0 million in interest expense from the amortization of convertible debt issuance costs, partially offset by $0.7 million in interest income. Total other expense, net in the six months ended July 3, 2021 of $3.0 million consisted of $1.3 million in interest expense from the amortization of convertible debt issuance costs, $1.0 million in loss on extinguishment of debt associated with the termination of our ~~products~~bank credit facility, $0.1 million in foreign currency transaction losses, partially offset by $0.2 million in subsidies received from the Jiaxing Economic Development Zone Finance Bureau for our investment in BYND JX.

Net loss was $97.1 million and $197.6 million in the three and six months ended July 2, 2022, respectively, compared to net loss of $19.7 million and $46.9 million in the prior-year periods. Net loss during the ~~summer grilling season. As our business continues~~three and six months ended July 2, 2022 was primarily due to ~~grow, we expect~~lower gross profit and higher operating expenses discussed above compared to ~~see additional seasonality effects, with revenue growth tending to be greater in~~ the ~~second and third quarters of the year.~~prior-year periods.

Non-GAAP Financial Measures

We use the ~~following~~ non-GAAP financial measures set forth below in assessing our operating performance and in our financial ~~communications:~~communications. Management believes these non-GAAP financial measures provide useful additional information to investors about current trends in our operations and are useful for period-over-period comparisons of operations. In addition, management uses these non-GAAP financial measures to assess operating performance and for business planning purposes. Management also believes these measures are widely used by investors, securities analysts, rating agencies and other

parties in evaluating companies in our industry as a measure of our operational performance. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures. In addition, these non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies.

“Adjusted ~~EBITDA~~”EBITDA” is defined as net loss adjusted to exclude, when applicable, income tax expense, interest expense, depreciation and amortization expense, restructuring expenses, share-based compensation expense, ~~inventory losses from termination~~expenses attributable to COVID-19, and Other, net, including interest income, loss on extinguishment of ~~an exclusive supply agreement with a co-manufacturer, costs of termination of an exclusive supply agreement with the same co-manufacturer,~~debt and ~~expenses primarily associated with the conversion of our convertible notes~~foreign currency transaction gains and ~~remeasurement of our preferred stock warrant liability and common stock warrant liability.~~losses.

“Adjusted EBITDA as a % of net ~~revenues~~” revenues” is defined as Adjusted EBITDA divided by net revenues.

~~“Pro forma basic and diluted net loss per common share~~” is defined as net loss divided by weighted average common shares outstanding—basic and diluted, as adjusted to reflect the conversion of all outstanding shares of convertible preferred stock into shares of common stock on a one-for-one basis and the automatic conversion of all preferred stock warrants to common stock warrants upon closing of the IPO and subsequent exercise of all common stock warrants as if the IPO was completed as of the first day of the applicable period. We believe the presentation of Pro forma basic and diluted net loss per common share allows for comparability with our expected capital structure following the IPO.

We use Adjusted EBITDA and Adjusted EBITDA as a % of net revenues because they are important measures upon which our management assesses our operating performance. We use Adjusted EBITDA and Adjusted EBITDA as a % of net revenues as key performance measures because we believe these measures facilitate operating performance comparison from period-to-period by excluding potential differences primarily caused by the impact of restructuring, asset depreciation and amortization, non-cash share-based compensation and non-operational charges including the impact to cost of goods sold and SG&A expenses related to the termination of an exclusive co-manufacturing agreement, early extinguishment of convertible notes and remeasurement of warrant liability. Because Adjusted EBITDA and Adjusted EBITDA as a % of net revenues facilitate internal comparisons of our historical operating performance on a more consistent basis, we also use those measures for our business planning purposes. In addition, we believe Adjusted EBITDA and Adjusted EBITDA as a % of net revenues are widely used by investors, securities analysts, ratings agencies and other parties in evaluating companies in our industry as a measure of our operational performance.

There are a number of limitations related to the use of Adjusted EBITDA and Adjusted EBITDA as a % of net revenues rather than ~~net loss, which is the~~their most directly comparable GAAP measure. Some of these limitations are:

•Adjusted EBITDA excludes depreciation and amortization expense and, although these are non-cash expenses, the assets being depreciated may have to be replaced in the future increasing our cash requirements;

•Adjusted EBITDA does not reflect interest expense, or the cash required to service our debt, which reduces cash available to us;

•Adjusted EBITDA does not reflect income tax payments that reduce cash available to us;

•Adjusted EBITDA does not reflect restructuring expenses that reduce cash available to us;

•Adjusted EBITDA does not reflect expenses attributable to COVID-19 that reduce cash available to us;

•Adjusted EBITDA does not reflect share-based compensation ~~expenses~~expense and therefore does not include all of our compensation costs;

•Adjusted EBITDA does not reflect ~~other~~Other, net, including interest income, ~~(expense)~~loss on extinguishment of debt and foreign currency transaction gains and losses, that may increase or decrease cash available to us; and

•other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

These non-GAAP financial measures should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. These non-GAAP financial measures may not be computed in the same manner as similarly titled measures used by other companies.

The following table presents the reconciliation of Adjusted EBITDA to its most comparable GAAP measure, net loss, as reported (unaudited):

Restructuring expenses⁽¹⁾

Restructuring expenses(1)



(1)			Primarily comprised of legal and other expenses associated with the dispute with a co-manufacturer with whom an exclusive supply agreement was terminated in May 2017.
(2)			(a) Includes ~~expenses primarily~~$5.5 million and $6.6 million in foreign currency transaction losses in the three and six months ended July 2, 2022, respectively, and $0.2 million in foreign currency transaction gains and $0.1 million in foreign currency transaction losses in the three and six months ended July 3, 2021, respectively. (b) Includes $1.0 million in loss on extinguishment of debt associated with termination of the ~~remeasurement of our preferred stock warrant liability and common stock warrant liability.~~Company's credit facility in the six months ended July 3, 2021.

Below we have provided a reconciliation of Pro forma basic and diluted net loss per common share to the most directly comparable financial measure, net loss per common share—basic and diluted, calculated and presented in accordance with GAAP, for each of the periods presented (unaudited):

Three Months Ended
(in thousands, except share and per share data) March 30, 2019
March 31, 2018
Pro forma basic and diluted net loss per common share:
Numerator:
Net loss, as reported $ (6,649 ) $ (5,696 )

Denominator:
Weighted average common shares outstanding—basic and diluted, as reported 6,974,301
5,793,801
Add: Adjustment to reflect assumed conversion of convertible preferred stock 41,562,111
39,474,156
Add: Adjustment to reflect potential conversion of preferred stock warrants to common stock warrants and subsequent exercise of all common stock warrants 220,769
160,767
Weighted average common shares outstanding used in computing Pro forma basic and diluted net loss per common share 48,757,181
45,428,724

Net loss per common share—basic and diluted, as reported $ (0.95 ) $ (0.98 )
Effect of adjustments to weighted average common shares outstanding 0.81
0.85
Adjusted basic and diluted net loss per common share $ (0.14 ) $ (0.13 )

Liquidity and Capital Resources

Convertible Senior Notes

For a discussion about the Notes, see Note 7, Debt, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report.

In 2022, our cash from operations could be affected by various risks and uncertainties, including, but not limited to, the effects of COVID-19 and other risks detailed in Part I, Item 1A, “Risk Factors,” of our 2021 10-K and Part II, Item 1A, “Risk Factors” and “Note Regarding Forward-Looking Statements” included elsewhere in this report. The pandemic, inflation, rising interest rates and hostilities in Eastern Europe have led to increased disruption and volatility in capital markets and credit markets generally which could adversely affect our liquidity and capital resources in the future. However, based on our current business plan, we believe that our existing cash balances will be sufficient to finance our operations and meet our foreseeable cash requirements through at least the next twelve months. In the future, we may raise funds by issuing debt or equity securities. Our cash requirements under our significant contractual obligations and commitments are listed below in the section titled “Contractual Obligations and Commitments.” Our future capital requirements may vary materially from those currently planned and will depend on many factors, including the impact of the COVID-19 pandemic; the number and characteristics of any additional products or manufacturing processes we develop or acquire to serve new or existing markets; our investment in and build out of our campus headquarters and expanding our Manhattan Beach Project Innovation Center; the expenses associated with our marketing initiatives; our investment in manufacturing and facilities to expand our manufacturing and production capacity; our investments in real property and joint ventures; the costs required to fund domestic and international operations and growth; the scope, progress, results and costs of researching and developing future products or improvements to existing products or manufacturing processes; any lawsuits related to our products or commenced against us or our directors and officers; the expenses needed to attract and retain skilled personnel; the costs associated with being a public company; the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing intellectual property claims, including litigation costs and the outcome of such litigation; and the timing, receipt and amount of sales of, or royalties on, any future approved products, if any.

Our primary cash needs are for operating expenses, working capital and capital expenditures to support the planned growth in our business. Prior to our IPO, we financed our operations through private sales of equity securities and through sales of our products. Since our inception and through ~~March 30, 2019,~~our IPO, we raised a total of $199.5 million from the sale of convertible preferred stock, including through sales of convertible notes which were converted into preferred stock, net of costs associated with such financings. In connection with our IPO, we sold an aggregate of 11,068,750 shares of our common stock ~~including 1,443,750 shares pursuant to the underwriters’ over-allotment option,~~ at ~~an IPO~~a public offering price of $25.00 per share and received approximately ~~$252.5~~$252.4 million in net proceeds. ~~We have also entered into~~In connection with our Secondary Offering, we sold 250,000 shares of our common stock at a public offering price of $160.00 per share and received approximately $37.4 million in net proceeds. In March 2021, we issued $1.2 billion in aggregate principal amount of Notes (see Note 7, Debt, to the ~~credit facilities described below with Silicon Valley Bank (“SVB”)~~Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report).

As of ~~March 30, 2019,~~July 2, 2022, we had ~~$35.4~~$454.7 million in cash and cash equivalents. We believe that our cash and cash equivalents, proceeds from our IPO, cash flow from operating activities and available borrowings under our credit facilities will be sufficient to fund our working capital and meet our anticipated capital requirements for at least the next 12 months. Our future capital requirements may vary materially from those currently planned and will depend on many factors, including the number and characteristics of any additional products or manufacturing processes we develop or acquire to serve new or existing markets; the scope, progress, results and costs of researching and developing future products or improvements to existing products or manufacturing processes; any lawsuits related to our products or commenced against us, including the costs associated with our current litigation with a former co-manufacturer; the expenses needed to attract and retain skilled personnel; the costs associated with being a public company; the costs involved in preparing, filing, prosecuting, maintaining, defending and enforcing patent claims, including litigation costs and the outcome of such litigation; and the timing, receipt and amount of sales of, or royalties on, any future approved products, if any.

~~Amended and Restated Loan and Security Agreement~~Cash Flows

In June 2018, we refinanced our then existing revolving credit facility and term loan facility under a loan and security agreement with SVB (the “Amended LSA”). The Amended LSA includes a $6.0 million revolving credit facility (the “2018 Revolving Credit Facility”) and a term loan facility (the “2018 Term Loan Facility”) comprised of (i) a $10.0 million term loan advance at closing, (ii) a conditional $5.0 million term loan advance, if no event of default has occurred and is continuing through the borrowing date, and (iii) an additional conditional term loan advance of $5.0 million if no event of default has occurred and is continuing based upon a minimum level of gross profit for the trailing 12-month period. The 2018 Term Loan Facility has a floating interest rate that is equal to 4.0% above the prime rate, with interest payable monthly and principal amortizing commencing on January 1, 2020, and will mature in June 2022. Borrowings under the 2018 Revolving Credit Facility carry a variable annual interest rate of prime rate plus 0.75% to 1.25% with an additional 5% on the outstanding balances in the event of a default. The 2018 Revolving Credit Facility matures in June 2020.

The 2018 Term Loan Facility and the 2018 Revolving Credit Facility (collectively, the “SVB Credit Facilities”) contain customary negative covenants that limit our ability to, among other things, incur additional indebtedness, grant liens, make investments, repurchase stock, pay dividends, transfer assets and merge or consolidate. The SVB Credit Facilities are secured by a blanket lien on all of our personal property assets. The SVB Credit Facilities also contain customary affirmative covenants, including delivery of audited financial statements. We were in compliance with the covenants in the SVB Credit Facilities as of March 30, 2019.

~~As of March 30, 2019 and December 31, 2018, we had $6.0 million and $20.0~~six months ended July 2, 2022, approximately $102.7 million in ~~borrowings on the 2018 Revolving Credit Facility~~aggregate expenditures to purchase inventory, purchase property, plant and ~~2018 Term Loan Facility, respectively,~~equipment and had no availability to borrow under either of these loan facilities. In the three months ended March 30, 2019 and March 30, 2018, we incurred $0.6 million and $18,400 in interest expense related to SVB credit facilities. The interest rates on the 2018 Revolving Credit Facility and the 2018 Term Loan Facility at March 30, 2019 were 6.25% and 9.50%, respectively.

~~Equipment Loan Facility~~

In September 2018, we entered into an Equipment Loan and Security Agreement with Structural Capital Investments II, LP (“Structural Capital”) and Ocean II PLO, LLC, as administrative and collateral agent, pursuant to which Structural Capital agreed to provide an equipment loan facility to us in the amount of $5.0 million for the purpose of purchasing equipment.

~~We are required to~~ pay interest on any unpaid principal amounts at a per annum rate equal to 6.25% plus the greater of 4.75% or the prime rate then in effect. Interest on each advance made to us is due and payable on the first business day of each month. We must begin repaying the aggregate principal amount of all advances we have received in equal monthly installments beginning on June 30, 2019, which may be extended for six or 18 months depending on whether we achieve certain milestones. The unpaid balance of all advances will become due on May 1, 2022. We must also pay a final payment fee of 13% of the facility commitment amount on the maturity date and such other date as the advances become due and such fee will increase by 1% if certain milestones are achieved.

The equipment loan facility has a prepayment penalty of 2% during the first two years of the term and 1% thereafter. The facility contains customary negative covenants that limit our ability to, among other things, grant liens, repurchase stock, pay dividends, transfer assets and merge or consolidate. It is secured by all equipment purchased with cash borrowed under the facility and all of our accounts, money, books, records and any cash or noncash proceeds of the foregoing. The facility also contains customary affirmative covenants, including delivery of audited financial statements. We were in compliance with the covenants contained in the facility as of March 30, 2019.

We had $5.0 million in borrowings outstanding as of March 30, 2019 and December 31, 2018 under the equipment loan facility. The interest rate on the equipment loan facility at March 30, 2019 and December 31, 2018 was 11.75% and 11.5%, respectively. For the three months ended March 30, 2019 and March 31, 2018, we recorded $0.3 million and $0, respectively, in interest expenseescrow payments related to the ~~equipment loan facility.~~

~~Cash Flows~~Campus Lease, and approximately $174.5 million in net cash outflows from other operating, investing and financing activities were funded with our existing cash balance.

The following table presents the major components of net cash flows ~~from~~used in and ~~used in~~provided by operating, investing and financing activities for the periods indicated.

Net Cash Used in Operating Activities

In ~~three~~the six months ended ~~March 30, 2019,~~July 2, 2022, we incurred a net loss of ~~$6.6~~$197.6 million, which was the primary reason for net cash used in operating activities of ~~$13.3~~$235.7 million. Net ~~cash used in operating activities also included $10.2 million in net~~ cash outflows from changes in our operating assets and liabilities were $86.2 million, primarily due to the escrow payments related to the Campus Lease (see Note 10, Commitments and Contingencies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report), increase in accounts receivable balances and increase in inventory. The cash outflows were partially offset by ~~$3.6~~the increase in accrued expenses and other current liabilities. Net loss in the six months ended July 2, 2022 included $48.1 million in non-cash expenses primarily comprised of ~~depreciation and amortization expense,~~ share-based compensation expense and ~~change in warrant liability.~~depreciation and amortization expense.

In ~~three~~the six months ended ~~March 31, 2018,~~July 3, 2021, we ~~incurred~~recorded a net loss of ~~$5.7~~$46.9 million which was the primary reason for net cash used in operating activities of ~~$4.9~~$120.4 million. Net ~~cash used in operating activities also included $0.3 million in net~~ cash outflows from changes in our operating assets and liabilities were $102.6 million, primarily due to the increase in inventory, increase in accounts receivable balances and escrow payments related to the Campus Lease (see Note 10, Commitments and Contingencies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report). The cash outflows were partially offset by ~~$1.1~~the increase in accrued expenses and other current liabilities. Net loss in the six months ended July 3, 2021 included $29.1 million in non-cash expenses primarily comprised of ~~depreciation and amortization expense,~~ share-based compensation expense and ~~change in warrant liability.~~depreciation and amortization expense.

Depreciation and amortization expense was ~~$1.9~~$14.8 million and ~~$0.7~~$9.2 million in ~~three~~the six months ended ~~March 30, 2019~~July 2, 2022 and ~~March 31, 2018,~~July 3, 2021, respectively. We anticipate our depreciation and amortization expense will be approximately $2.1 million per quarter in 2019 based on our existing fixed assets and anticipated capital expenditures as we expand our production capabilities to meet increased demand for our products.

Net Cash Used in Investing Activities

Net cash used in investing activities primarily relates to capital expenditures to support our ~~growth and~~ investment in property, plant and equipment.

In the ~~three~~six months ended ~~March 30, 2019,~~July 2, 2022, net cash used in investing activities was ~~$5.0~~$42.0 million and consisted of cash outflows for ~~the~~ purchases of property, plant and equipment, primarily ~~for manufacturing facility improvements~~driven by continued investments in production equipment and ~~manufacturing equipment, assets purchased for sale to co-manufacturers and security deposits.~~facilities.

In the ~~three~~six months ended ~~March 31, 2018,~~July 3, 2021, net cash used in investing activities was ~~$3.7~~$51.6 million and consisted of cash outflows for ~~the purchase~~purchases of property, plant and equipment, primarily ~~for manufacturing facility improvements~~driven by continued investments in production equipment and ~~manufacturing equipment.~~

~~In 2019, we anticipate spending approximately $17.0 million in capital expenditures as we scale~~facilities related to our ~~production~~ capacity ~~including expenditures for additional machinery~~expansion initiatives and ~~equipment, as well as investment facilities and expenditures to replace normal wear and tear of machinery and equipment.~~ international expansion.

Net Cash ~~Used in~~Provided by Financing Activities

In the ~~three~~six months ended ~~March 30, 2019,~~July 2, 2022, net cash ~~used in~~provided by financing activities was ~~$0.6~~$0.5 million primarily ~~as a result of $0.9 million in payments of deferred offering costs associated with the IPO, partially offset by $0.4~~from $1.3 million in proceeds from stock option ~~exercises.~~

exercises, partially offset by $0.8 million in payments of minimum withholding taxes on net share settlement of equity awards and payments under finance lease obligations.

In the ~~three~~six months ended ~~March 31, 2018,~~July 3, 2021, net cash ~~used in~~provided by financing activities was ~~$1.4~~$1,022.1 million primarily ~~as a result~~from the proceeds of ~~$2.6~~the Notes of $1,066.1 million and $6.5 million in ~~repayments on our revolving credit line and term loan,~~proceeds from stock option exercises, partially offset by ~~$1.2~~repayment of revolving credit facility of $25.0 million, debt issuance costs of $23.6 million associated with the Notes, $1.8 million in payments of minimum withholding taxes on net ~~proceeds from the issuance~~share settlement of ~~our Series G preferred stock.~~equity awards and payments under finance lease obligations.

~~As of March 30, 2019, we had borrowed the entire availability of $20.0 million under the 2018 Term Loan Facility and $6.0 million under the 2018 Revolving Credit Facility.~~

Contractual Obligations and Commitments

There have been no significant changes during the ~~three~~six months ended ~~March 30, 2019~~July 2, 2022 to the contractual obligations disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in the ~~Prospectus~~2021 10-K, other than the following:

~~Effective March 1, 2019,~~On January 14, 2021, we entered into the Campus Lease with HC Hornet Way, LLC, a ~~lease for~~Delaware limited liability company (the “Landlord”), to house our ~~principal executive~~lab and innovation space and headquarters offices in El Segundo, ~~California,~~California. As of July 2, 2022, the tenant improvements associated with Phase 1-A had not been completed, and the underlying asset had not been delivered to the Company. Accordingly, there was no lease commencement during the six months ended July 2, 2022. Therefore, we have not recognized an asset or a liability for the Campus Lease in our condensed consolidated balance sheets as of July 2, 2022 and December 31, 2021. We contributed $43.7 million and $59.2 million in payments to a construction escrow account in the six months ended July 2, 2022 and the year ended December 31, 2021, respectively. In the three and six months ended July 2, 2022, we paid $0.5 million and $0.8 million, respectively, in payments towards common area maintenance, parking, and insurance under the Campus Lease. No such payments were made in the three and six months ended July 3, 2021.

Concurrent with our execution of the Campus Lease, as a security deposit, we delivered to the landlord a letter of credit under the revolving credit facility in the amount of $12.5 million. Upon termination of the revolving credit facility, the letter of credit continued in effect, unsecured. See Note 10, Commitments and Contingencies, and Note 4, Leases, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report.

China Investment and Lease Agreement

In the three months ended July 2, 2022, we amended the lease for our facility in the JXEDZ to extend the term an ~~initial~~additional five years without rent escalation. As of July 2, 2022, we had invested $22.0 million and had advanced $20.0 million to our subsidiary, BYND JX. See Note 10, Commitments and Contingencies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report.

Investment in The Planet Partnership

On January 25, 2021, we entered into TPP, a joint venture with PepsiCo, Inc., to develop, produce and market innovative snack and beverage products made from plant-based protein. We believe TPP will allow us to reach more consumers by entering new product categories and distribution channels, increasing accessibility to plant-based protein around the world. We recognized our share of the net losses in TPP in the amount of $1.4 million and $0.2 million for the three months ended July 2, 2022 and July 3, 2021, respectively, and our share of the net losses in TPP in the amount of $2.1 million and $0.6 million for the six months ended July 2, 2022 and July 3, 2021, respectively. In the three months ended July 2, 2022, we also entered into an agreement for a nonrefundable up-front fee associated with our manufacturing and supply agreement with TPP that will be recognized over the estimated term of ~~five years. The aggregate lease amount for~~ the ~~five-year term is $2.7 million. The future minimum lease payments required under noncancelable lease obligations related~~manufacturing and supply agreement. See Note 13, Related Party Transactions, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this ~~lease are $2.6~~report. For the year ended December 31, 2021, we contributed our share of the investment in TPP, $11.0 million, ~~due through 2023 (approximately $0.5 million annually) and $0.1 million thereafter.~~which was increased subsequent to the quarter ended July 2, 2022. See Note 14, Subsequent Events, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report.

Purchase Commitments

As of ~~March 30, 2019, the Company~~July 2, 2022, we had ~~committed~~a commitment to purchase pea protein inventory totaling ~~$46.1~~$56.4 million. in the remainder of 2022, which commitment schedule was amended subsequent to the quarter ended July 2, 2022 to purchase $16.2 million in the remainder of 2022 and $40.2 million in 2023. See Note 14, Subsequent Events, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report. In addition, as of July 2, 2022, we had approximately $49.3 million in purchase order commitments for capital expenditures primarily to purchase machinery and equipment and $86.7 million in fee commitments to

manufacture products at a co-manufacturer’s facility over a 5-year term (see Note 10, Commitments and Contingencies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report).

Subsequent to the quarter ended July 2, 2022, on July 27, 2022, we entered into an agreement to purchase certain real property on a neighboring site to our manufacturing facility in Europe located in Enschede, the Netherlands, for cash consideration of approximately €6.3 million. The purchase is expected to close in the second half of 2023 (see Note 14, Subsequent Events, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report).

Off-balance Sheet Arrangements

We do not have any off-balance sheet arrangements or any holdings in variable interest entities.

Critical Accounting Policies

In preparing our financial statements in accordance with GAAP, we are required to make estimates and assumptions that affect the amounts of assets, liabilities, revenue, costs and expenses, and disclosure of contingent assets and liabilities that are reported in the financial statements and accompanying disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates and assumptions. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.

There have been no material changes in our critical accounting policies during the ~~three~~six months ended ~~March 30, 2019,~~July 2, 2022, as compared to those disclosed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies” in the ~~Prospectus and~~ 2021 10-K other than as described in Note 2, Summary of Significant Accounting Policies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in ~~Part I, Item 1 of~~ this report.

~~Emerging Growth Company Status~~

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” We may take advantage of these exemptions until we are no longer an “emerging growth company.” Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates. We may take advantage of these exemptions up until the last day of

the fiscal year following the fifth anniversary of this offering or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, we have more than $700.0 million in market value of our stock held by non-affiliates (and we have been a public company for at least 12 months and have filed one annual report on Form 10-K) or we issue more than $1.0 billion of non-convertible debt securities over a three-year period.

Recent Accounting Pronouncements

Please refer to Note 2,Summary of Significant Accounting Policies, to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in ~~Part I, Item 1 of~~ this report for a discussion of recently adopted accounting pronouncements and new accounting pronouncements that may impact us.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our cash consists of amounts held by third-party financial institutions. ~~In May 2019, upon closing of our IPO, we adopted an~~Our investment policy ~~which~~ has as its primary objective investment activities which ~~preserves~~preserve principal without significantly increasing risk.

~~We are subject~~On March 2, 2021, we terminated our revolving credit facility. In the three and six months ended July 2, 2022, we incurred no interest expense related to our bank credit facilities. In the three and six months ended July 3, 2021, we incurred $0 and $0.3 million, respectively, in interest ~~rate risk~~expense related to our bank credit facilities. Upon termination of the revolving credit facility, unamortized debt issuance costs of $1.0 million associated with the revolving credit facility were written off as “Loss on extinguishment of debt,” which is included in ~~connection with~~“Other, net” in our ~~SVB Credit Facilities~~condensed consolidated statement of operations for the six months ended July 3, 2021. There was no similar transaction in the six months ended July 2, 2022.

On March 5, 2021, we issued $1.0 billion aggregate principal amount of Convertible Notes and ~~our equipment loan facility.~~on March 16, 2021, we issued $150.0 million aggregate principal amount of Additional Notes. The proceeds from the issuance of the Notes were approximately $1.0 billion, net of capped call transaction costs of $84.0 million and debt issuance costs totaling $23.6 million. See ~~“—Liquidity~~Note 7, Debt, to the Notes to Unaudited Condensed

~~Our profitability is dependent on, among other things, our ability to anticipate~~During the three and react to raw material and food costs. Currently, the main ingredient in our products is pea protein, which we source from Canada and France. The prices of pea protein and other ingredients we use are subject to many factors beyond our control, such as the number and size of farms that grow Canadian and European yellow peas, the vagaries of these farming businesses, including poor harvests due to adverse weather conditions, natural disasters and pestilence, and changes in national and world economic conditions. In addition, we purchase some ingredients and other materials offshore, and the price and availability of such ingredients and materials may be affected by political events or other conditions in these countries or tariffs or trade wars. As of March 30, 2019,six months ended July 2, 2022, a hypothetical 10% increase or 10% decrease in the weighted-average cost of pea protein, our primary ingredient, would have resulted in an increase of approximately ~~$0.4~~$1.1 million and $1.9 million, respectively, or a decrease of approximately ~~$0.4~~$1.1 million and $1.9 million, respectively, to cost of goods sold. We are working to diversify our sources of supply and intend to enter into long-term contracts to better ensure stability of prices of our raw materials. As of July 2, 2022, we had a multi-year sales agreement with Roquette for the supply of pea protein which was amended subsequent to the quarter ended July 2, 2022, to expire in December 2023. See Note 10, Commitments and Contingencies, and Note 14, Subsequent Events to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this report.

Foreign ~~Exchange~~Currency Risk

Our ~~revenues and costs are~~foreign exchange risk is primarily related to our intercompany balances denominated in ~~U.S. dollars~~various foreign currencies. We have exposure to the European Euro and ~~are not subject~~the Chinese Yuan. Unrealized translation losses, net of tax, reported as cumulative translation adjustments through “Other comprehensive loss” were $(3.0) million for the six months ended July 2, 2022. Foreign currency transaction losses included in “Other, net” were $(5.5) million and $(6.6) million, respectively, in the three and six months ended July 2, 2022.

Unrealized translation losses, net of tax, reported as cumulative translation adjustments through “Other comprehensive loss” were $(0.7) million for the six months ended July 3, 2021. Foreign currency transaction income (losses) included in “Other, net” were $0.2 million and $(0.1) million, respectively, in the three and six months ended July 3, 2021.

Based on the intercompany balances as of July 2, 2022, an assumed 5% or 10% adverse change to foreign exchange ~~risk. However, to the extent our sourcing strategy changes~~rates would result in a loss of approximately $(3.8) million or ~~we commence generating net revenues outside of the United States that are denominated~~$(7.7) million, respectively, recorded in ~~currencies other than the U.S. dollar, our results of operations could be impacted by changes in exchange rates.~~“Other, net.”

WeAlthough we have seen inflation in certain raw materials, and in the cost of logistics and labor, we do not believe that inflation has had a material effect on the costs of our ~~business, results of operations, or financial condition.~~inputs. Although difficult to quantify, we believe inflation is potentially having an adverse effect on our end customers’ ability to purchase our products, resulting in decreased sales. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could harm our business, results of operations and financial condition.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the ~~Securities~~ Exchange Act, ~~of 1934, as amended (the “Exchange Act”),~~ as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our principal executive officer and principal financial officer have concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

There were no changes in our internal control over financial reporting during the quarter ended ~~March 30, 2019~~July 2, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitations on Effectiveness of Controls and Procedures

Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our ~~company~~Company have been detected.

Part II. Other Information

ITEM 1. LEGAL PROCEEDINGS.

We are subject to various legal proceedings and claims that arise in the ordinary course of our business. The Company establishes an accrued liability for legal matters when those matters present loss contingencies that are both probable and estimable. Although the outcome of these and other claims cannot be predicted with certainty, management is not currently able to estimate the reasonable possible amount of loss or range of loss and does not believe that it is probable that the ultimate resolution of the current matters will have a material adverse effect on our business, financial condition, results of operations or cash flows.

~~On May 25, 2017, Don Lee Farms, a division~~ However, the final results of ~~Goodman Food Products, Inc., filed a complaint against us~~any current or future proceeding cannot be predicted with certainty, and until there is final resolution on any such matter that we may be required to accrue for, we may be exposed to loss in ~~the Superior Court~~excess of the ~~State~~amount accrued. Regardless of ~~California for~~ the ~~County~~outcome, litigation can have an adverse impact on us because of ~~Los Angeles asserting claims for breach~~defense and settlement costs, diversion of ~~contract, misappropriation of trade secrets, unfair competition under the California Business~~management resources, and ~~Professions Code, money owed and due, declaratory relief and injunctive relief, each arising out~~other factors.



Delaware			26-4087597
(State or other jurisdiction of ~~Incorporation~~incorporation or organization)			(I.R.S. Employer Identification No.)




TABLE OF CONTENTS
			Page
Part I. Financial Information
Item 1. Financial Statements (Unaudited):			1
Condensed Consolidated Balance Sheets			1
Condensed Consolidated Statements of Operations			3
Condensed Consolidated Statements of ~~Convertible Preferred Stock and Stockholders’ Deficit~~Comprehensive Loss			4
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)			5
Condensed Consolidated Statements of Cash Flows			56
Notes to Unaudited Condensed Consolidated Financial Statements			78
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			2229
Item 3. Quantitative and Qualitative Disclosures About Market Risk			3748
Item 4. Controls and Procedures			3849
Part II. Other Information
Item 1. Legal Proceedings			3951
Item 1A. Risk Factors			4051
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			6362
Item 3. Defaults Upon Senior Securities			6362
Item 4. Mine Safety Disclosures			6362
Item 5. Other Information			6362
Item 6. Exhibits			6463
~~Exhibit Index~~Signatures			6465
~~Signatures~~			67


	July 2, 2022
(in thousands)	Operating Leases(1)		Finance Leases
Remainder of 2022	$	2,841	$	116
2023	5,501		219
2024	3,811		184
2025	3,230		153
2026	2,972		47
2027	2,456		16
Thereafter	10,597		—
Total undiscounted future minimum lease payments	31,408		735
Less imputed interest	(5,670)		(40)
Total discounted future minimum lease payments	$	25,738	$	695


(in thousands)	March 30, 2019		December 31, 2018		(in thousands)	July 2, 2022		December 31, 2021
Manufacturing equipment	$	28,866	$	25,314	Manufacturing equipment	$	144,964	$	115,412
Research and development equipment	7,111		6,088		Research and development equipment	16,944		16,837
Leasehold improvements	7,166		7,080		Leasehold improvements	20,510		20,250
Capital leases	883		882
Building					Building	22,548		22,937
Finance leases					Finance leases	981		867
Software	125		60		Software	1,354		1,297
Furniture and fixtures	203		195		Furniture and fixtures	865		868
Vehicles	210		210		Vehicles	584		584
Land					Land	5,345		5,434
Assets not yet placed in service	1,877		3,374		Assets not yet placed in service	111,281		95,455
Total property, plant and equipment	$	46,441	$	43,203	Total property, plant and equipment	$	325,376	$	279,941
Less: accumulated depreciation and amortization	14,580		12,676		Less: accumulated depreciation and amortization	67,301		53,452

Property, plant and equipment, net	$	31,861	$	30,527	Property, plant and equipment, net	$	258,075	$	226,489



o☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



	March 30, 2019		December 31, 2018
Assets
Current assets:
Cash and cash equivalents	$	35,409	$	54,271
Accounts receivable	16,194		12,626
Inventory	34,281		30,257
Prepaid expenses and other current assets	6,525		5,672
Total current assets	92,409		102,826
Property, plant, and equipment, net	31,861		30,527
Other non-current assets, net	887		396
Total assets	$	125,157	$	133,749
Liabilities, Convertible Preferred Stock and Stockholders’ Deficit:
Current liabilities:
Accounts payable	$	11,663	$	17,247
Wages payable	1,085		1,255
Accrued bonus	3,387		2,312
Accrued expenses and other current liabilities	3,094		2,391
Short-term capital lease liabilities	36		44
Stock warrant liability	2,677		1,918
Total current liabilities	$	21,942	$	25,167
Long-term liabilities:
Revolving credit line	$	6,000	$	6,000
Long-term portion of bank term loan, net	19,533		19,388
Equipment loan, net	4,914		5,000
Capital lease obligations and other long-term liabilities	406		404
Total long-term liabilities	$	30,853	$	30,792
Commitments and Contingencies (Note 9)



	March 30, 2019			December 31, 2018
Convertible preferred stock:
Series A convertible preferred stock, par value $0.0001 per share—3,333,500 shares authorized; 3,333,500 shares issued and outstanding as of March 30, 2019 and December 31, 2018	$	2,000		$	2,000
Series B convertible preferred stock, par value $0.0001 per share—4,802,260 shares authorized; 4,680,565 shares issued and outstanding as of March 30, 2019 and December 31, 2018	4,999			4,999
Series C convertible preferred stock, par value $0.0001 per share—8,076,643 shares authorized; 8,076,636 shares issued and outstanding as of March 30, 2019 and December 31, 2018	14,882			14,882
Series D convertible preferred stock, par value $0.0001 per share—8,713,207 shares authorized; 8,713,201 shares issued and outstanding as of March 30, 2019 and December 31, 2018	24,948			24,948
Series E convertible preferred stock, par value $0.0001 per share—4,740,531 shares authorized; 4,701,449 shares issued and outstanding as of March 30, 2019 and December 31, 2018	17,214			17,214
Series F convertible preferred stock, par value $0.0001 per share—4,866,776 shares authorized; 4,866,758 shares issued and outstanding as of March 30, 2019 and December 31, 2018	29,840			29,840
Series G convertible preferred stock, par value $0.0001 per share—5,140,257 shares authorized; 5,114,786 shares issued and outstanding as of March 30, 2019 and December 31, 2018	55,658			55,658
Series H convertible preferred stock, par value $0.0001 per share—4,209,693 shares authorized; 2,075,216 shares issued and outstanding as of March 30, 2019 and December 31, 2018	49,999			49,999
Stockholders’ deficit:
Common stock, par value $0.0001 per share—60,000,000 shares and 58,669,600 shares authorized at March 30, 2019 and December 31, 2018, respectively; 7,120,933 and 6,951,350 shares issued and outstanding at March 30, 2019 and December 31, 2018, respectively	1			1
Additional paid-in capital	9,142			7,921
Accumulated deficit	(136,321		)	(129,672		)
Total stockholders’ deficit	$	(127,178	)	$	(121,750	)
Total liabilities, convertible preferred stock and stockholders’ deficit	$	125,157		$	133,749



	Preferred Stock			Common Stock			Additional Paid-in Capital		Loans to Related Parties		Accumulated Deficit			Total
	Shares	Amount		Shares	Amount		Additional Paid-in Capital		Loans to Related Parties		Accumulated Deficit			Total
Balance at December 31, 2018	41,562,111	$	199,540	6,951,350	$	1	$	7,921	$	—	$	(129,672	)	$	(121,750	)
Net loss	—	—		—	—		—		—		(6,649		)	(6,649		)
Exercise of common stock options	—	—		169,583	—		366		—		—			366
Share-based compensation	—	—		—	—		855		—		—			855
Balance at March 30, 2019	41,562,111	$	199,540	7,120,933	$	1	$	9,142	$	—	$	(136,321	)	$	(127,178	)



	March 30, 2019
	Level 1		Level 2		Level 3		Total
Financial Liabilities:
Preferred stock warrant liability	$	—	$	—	$	1,998	$	1,998
Common stock warrant liability	—		—		679		679
Total	$	—	$	—	$	2,677	$	2,677

	December 31, 2018
	Level 1		Level 2		Level 3		Total
Financial Liabilities:
Preferred stock warrant liability	$	—	$	—	$	1,441	$	1,441
Common stock warrant liability	—		—		477		477
Total	$	—	$	—	$	1,918	$	1,918



	March 31,		December 31,
(in thousands)	2019		2018
Raw materials and packaging	$	16,385	$	13,756
Work in process	6,198		2,517
Finished goods	11,698		13,984
Total	$	34,281	$	30,257



	Number of Shares of Restricted Stock		Weighted Average Remaining Contractual Life (Years)	Weighted Average Grant Date Fair Value Per Share
Outstanding at December 31, 2018	100,127		1.6	$	17.03
Granted	—		—	$	—
Vested/Released	(12,946	)	—	$	—
Cancelled/Forfeited	—		—	$	—
Outstanding at March 30, 2019	87,181		1.4	$	17.03



	March 30, 2019	March 31, 2018
Convertible preferred stock (as converted)	41,562,111	39,474,156
Preferred stock warrants (as converted to common stock warrants and subsequently exercised)	160,767	160,767
Common stock warrants (as exercised)	60,002	—
Total	41,782,880	39,634,923



EXHIBIT INDEX
Exhibit No.	Exhibit Description	Incorporated by Reference			Filed Herewith
		Form	Date	Number
3.1	Restated Certificate of Incorporation.				X
3.2	Amended and Restated Bylaws.				X
4.1	Form of Common Stock Certificate.	S-1/A	3/27/2019	4.1
4.2	Amended and Restated Investors’ Rights Agreement, dated as of October 5, 2018, by and among the Registrant and the other parties thereto.	S-1	11/16/2018	4.2
10.1	Standard Industrial/Commercial Single-Tenant Lease, dated as of January 18, 2017, by and between Smoky Hollow Industries, LLC and Registrant with attachments thereto.	S-1	11/16/2018	10.1
10.2	Lease, dated March 13, 2014, as amended, by and between Sara Maguire LeMone as Trustee of the Sara Maguire LeMone Revocable Trust dated February 6, 2004 and Registrant and amendment thereto dated November 1, 2017.	S-1	11/16/2018	10.2
10.3	Lease, dated October 12, 2017, by and between LeMone Family Limited Partnership, LLLP and Registrant as amended by the Lease Amendment dated April 18, 2018.	S-1	11/16/2018	10.3
10.4	Amended and Restated Loan and Security Agreement (Revolving Line), dated as of June 27, 2018, by and between Silicon Valley Bank and Registrant.	S-1	11/16/2018	10.4
10.5	Loan and Security Agreement (Term Loan), dated June 27, 2018, by and between Silicon Valley Bank and Registrant.	S-1	11/16/2018	10.5
10.6	First Amendment to Loan and Security Agreement (Term Loan), dated September 27, 2018, by and between Silicon Valley Bank and Registrant.	S-1	11/16/2018	10.6
10.7	Intellectual Property Security Agreement, dated June 27, 2018, by and between Silicon Valley Bank and Registrant (Revolving Line).	S-1	11/16/2018	10.7
10.8	Intellectual Property Security Agreement, dated June 27, 2018, by and between Silicon Valley Bank and Registrant (Term Loan).	S-1	11/16/2018	10.8
10.9	Equipment Loan and Security Agreement, dated September 19, 2018, by and between Ocean II PLO, LLC and Registrant.	S-1	11/16/2018	10.9
10.10	Supply Agreement, dated December 28, 2018, by and between Roquette America, Inc. and Registrant.+	S-1/A	4/15/2019	10.10
10.11	Form of Indemnification Agreement with directors and executive officers.*	S-1/A	1/9/2019	10.11
10.12	2011 Equity Incentive Plan, amended as of April 3, 2019, and related forms of stock award agreements.*	S-1/A	4/15/2019	10.12