Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 24, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity File Number | 001-38824 | ||
Entity Registrant Name | CANOO INC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 83-1476189 | ||
Entity Address State Or Province | CA | ||
Entity Address, Address Line One | 19951 Mariner Avenue | ||
Entity Address, City or Town | Torrance | ||
Entity Address, Postal Zip Code | 90503 | ||
City Area Code | 424 | ||
Local Phone Number | 271-2144 | ||
Title of 12(b) Security | Common Stock, $0.0001 par value per share | ||
Trading Symbol | GOEV | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
ICFR Auditor Attestation Flag | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 251,887,174 | ||
Entity Common Stock, Shares Outstanding | 237,462,163 | ||
Entity Central Index Key | 0001750153 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 702,422 | $ 29,007 |
Restricted cash | 500 | |
Prepaids and other current assets | 6,463 | 1,754 |
Total current assets | 708,885 | 31,261 |
Property and equipment, net | 30,426 | 26,010 |
Operating lease right-of-use asset | 12,913 | 13,545 |
Other assets | 1,246 | 1,264 |
Total assets | 753,470 | 72,080 |
Current liabilities | ||
Accounts payable | 17,243 | 2,260 |
Accrued expenses and other current liabilities | 10,625 | 8,134 |
Total current liabilities | 27,868 | 10,394 |
Operating lease liabilities | 13,262 | 13,706 |
Contingent earn out shares liability | 133,503 | |
Long-term debt | 6,943 | |
Related party convertible debt | 86,051 | |
Related party derivative liability | 17,797 | |
Other long-term liabilities | 39 | |
Total liabilities | 181,615 | 127,948 |
Commitments and contingencies (Note 9) | ||
Stockholders' equity (deficit) | ||
Common stock, $0.0001 par value; 500,000,000 and 482,967 shares authorized; 235,753 and 108,838 issued and outstanding at December 31, 2020 and 2019, respectively | 24 | 11 |
Additional paid-in capital | 920,324 | 202,796 |
Accumulated deficit | (348,493) | (258,675) |
Total stockholders' equity (deficit) | 571,855 | (55,868) |
Total liabilities, redeemable convertible preference shares and stockholders' equity (deficit) | $ 753,470 | $ 72,080 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 0 |
Preferred stock, shares issued | 0 | |
Preferred stock, shares outstanding | 0 | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 482,967,000 |
Common stock, shares issued | 235,753,000 | 108,838,000 |
Common stock, shares outstanding | 235,753,000 | 108,838,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 2,550 | |
Costs and Operating Expenses | ||
Cost of revenue, excluding depreciation | 670 | |
Research and development, excluding depreciation | 142,862 | $ 137,378 |
Selling, general and administrative expenses, excluding depreciation | 51,611 | 31,553 |
Depreciation | 7,125 | 4,729 |
Total costs and operating expenses | 202,268 | 173,660 |
Loss from operations | (199,718) | (173,660) |
Other (expense) income | ||
Interest expense | (10,479) | (9,522) |
Gain on fair value change in contingent earnout share liability | 115,375 | |
Gain on extinguishment of debt | 5,045 | |
Other (expense) income, net | (39) | 822 |
Loss before income taxes | (89,816) | (182,360) |
(Provision for) income taxes | (2) | |
Net loss and comprehensive loss | (89,818) | (182,360) |
Redeemable convertible preference share dividends | $ 42,000 | $ 13,900 |
Per Share Data: | ||
Net loss per share, basic and diluted | $ (0.81) | $ (2.48) |
Weighted Average Number of Shares Outstanding, Basic and Diluted | 110,378,000 | 73,524,511 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) $ in Thousands | Redeemable convertible preference shares - Angel SeriesPreviously Reported | Redeemable convertible preference shares - Angel SeriesRevision of Prior Period, Reclassification, Adjustment [Member] | Redeemable convertible preference shares - Seed SeriesPreviously Reported | Redeemable convertible preference shares - Seed SeriesRevision of Prior Period, Reclassification, Adjustment [Member] | Common StockPreviously Reported | Common StockRevision of Prior Period, Reclassification, Adjustment [Member] | Common Stock | Additional Paid-in CapitalPreviously Reported | Additional Paid-in CapitalRevision of Prior Period, Reclassification, Adjustment [Member] | Additional Paid-in Capital | Accumulated deficitPreviously Reported | Accumulated deficit | Related party stockholder receivablePreviously Reported | Related party stockholder receivable | Previously Reported | Revision of Prior Period, Reclassification, Adjustment [Member] | Total |
Balance as of beginning of period at Dec. 31, 2018 | $ 100,000 | $ (100,000) | |||||||||||||||
Balance as of beginning of period (shares) at Dec. 31, 2018 | 77,000,000 | (77,000,000) | |||||||||||||||
Temporary Equity [Abstract] | |||||||||||||||||
Issuance of redeemable convertible preference shares | $ 100,000 | $ (100,000) | |||||||||||||||
Issuance of redeemable convertible preference shares (shares) | 33,333,000 | (33,333,000) | 33,300,000 | ||||||||||||||
Balance as of beginning of period at Dec. 31, 2018 | $ 3 | $ 5 | $ 8 | $ 847 | $ 99,995 | $ 100,842 | $ (76,315) | $ (76,315) | $ (20,000) | $ (20,000) | $ (95,465) | $ 100,000 | $ 4,535 | ||||
Balance as of beginning of period (shares) at Dec. 31, 2018 | 24,352,000 | 51,317,000 | 75,669,000 | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Issuance of shares in recapitalization | $ 2 | $ 99,998 | $ 100,000 | ||||||||||||||
Issuance of shares in recapitalization (shares) | 22,215,000 | 5,728,731 | |||||||||||||||
Issuance of shares upon early exercise of unvested share options | $ 1 | 127 | $ 128 | ||||||||||||||
Issuance of shares upon early exercise of unvested share options (shares) | 7,609,000 | ||||||||||||||||
Issuance of unvested restricted shares | $ 1 | (1) | |||||||||||||||
Issuance of unvested restricted shares (shares) | 8,745,000 | ||||||||||||||||
Proceeds from related party shareholder receivable | $ 20,000 | 20,000 | |||||||||||||||
Repurchase of unvested shares - forfeitures | $ (1) | (43) | (44) | ||||||||||||||
Repurchase of unvested shares - forfeitures (shares) | (5,400,000) | ||||||||||||||||
Share-based compensation | 1,873 | 1,873 | |||||||||||||||
Net loss and comprehensive loss | (182,360) | (182,360) | |||||||||||||||
Balance as of end of period at Dec. 31, 2019 | $ 11 | 202,796 | (258,675) | (55,868) | |||||||||||||
Balance as of end of period (shares) at Dec. 31, 2019 | 108,838,000 | ||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||
Exchange and gain on extinguishment of related party convertible debt | $ 4 | 207,778 | 207,782 | ||||||||||||||
Exchange and gain on extinguishment of related party convertible debt (shares) | 41,259,000 | ||||||||||||||||
Exchange of convertible debt | $ 2 | 86,755 | $ 86,757 | ||||||||||||||
Exchange of convertible debt (shares) | 21,960,000 | ||||||||||||||||
Issuance of shares upon early exercise of unvested share options (shares) | 424,000 | 424 | |||||||||||||||
Issuance of unvested restricted shares (shares) | 101,000 | ||||||||||||||||
Shares issued in offering | $ 7 | 607,129 | $ 607,136 | ||||||||||||||
Shares issued in offering (shares) | 69,549,000 | ||||||||||||||||
Offering costs | (19,088) | (19,088) | |||||||||||||||
Repurchase of unvested shares - forfeitures (shares) | (6,378,000) | ||||||||||||||||
Share-based compensation | 84,280 | 84,280 | |||||||||||||||
Settlement on restricted stock tax withholding | (448) | (448) | |||||||||||||||
Contingent earnout shares liability | (248,878) | (248,878) | |||||||||||||||
Net loss and comprehensive loss | (89,818) | (89,818) | |||||||||||||||
Balance as of end of period at Dec. 31, 2020 | $ 24 | $ 920,324 | $ (348,493) | $ 571,855 | |||||||||||||
Balance as of end of period (shares) at Dec. 31, 2020 | 235,753,000 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | |
Recapitalization Costs | $ 22,508 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss and comprehensive loss | $ (89,818) | $ (182,360) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 7,125 | 4,729 |
Non-cash operating lease expense | 632 | 606 |
Debt discount amortization | 2,590 | 3,848 |
Gain on extinguishment of debt | (5,045) | |
Stock-based compensation | 84,280 | 1,873 |
Gain on fair value change in contingent earnout share liability | (115,375) | |
Other | 9 | |
Changes in operating assets and liabilities: | ||
Prepaids and other current assets | (4,669) | (551) |
Other assets | 718 | 567 |
Accounts payable | 2,491 | (370) |
Accrued expenses and other current liabilities | 10,413 | 506 |
Operating lease liabilities | (444) | (300) |
Other long-term liabilities | 39 | |
Net cash used in operating activities | (107,054) | (171,452) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (7,558) | (22,144) |
Net cash used in investing activities | (7,558) | (22,144) |
Cash flows from financing activities: | ||
Proceeds from related party shareholder receivable | 20,000 | |
Repayments on related party promissory note | (15,000) | |
Proceeds from related party convertible debt and derivative liability | 100,000 | |
Proceeds from the issuance of common stock for related party convertible debt | 90,000 | |
Proceeds from the issuance of common stock for convertible debt | 90,500 | |
Loan advance | 7,064 | |
Repayments on loan advance | 47 | |
Proceeds from issuance of unvested shares | 7 | 128 |
Proceeds from issuance of redeemable convertible preference shares-Seed Series | 100,000 | |
Repurchase of unvested shares | (64) | (44) |
Business combination and PIPE financing, gross proceeds | 629,604 | |
Business combination and PIPE financing, issuance costs | (22,508) | |
Settlement on restricted stock tax withholding | (448) | |
Payment on stock warrant redemption | (800) | |
Payment on offering costs | (5,781) | |
Net cash provided by financing activities | 787,527 | 205,084 |
Net increase in cash, cash equivalents, and restricted cash | 672,915 | 11,488 |
Cash, cash equivalents, and restricted cash | ||
Cash, cash equivalents, and restricted cash, beginning of period | 29,507 | 18,019 |
Cash, cash equivalents, and restricted cash, end of period | 702,422 | 29,507 |
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets | ||
Cash and cash equivalents at end of period | 702,422 | 29,007 |
Restricted cash at end of period | 500 | |
Total cash, cash equivalents, and restricted cash at end of period shown in the consolidated statements of cash flows | 702,422 | 29,507 |
Supplemental non-cash investing and financing activities | ||
Acquisition of property and equipment included in current liabilities | 3,992 | |
Offering costs included in accrued expenses and other current liabilities | 815 | |
Exchange of convertible debt | 291,309 | |
Exchange of redeemable convertible preference shares | 200,000 | |
Gain on extinguishment of related party convertible debt recorded in additional paid-in capital | 44,785 | |
Recognition of contingent earnout share liability | 248,878 | |
Supplemental disclosures of cash flow information | ||
Cash paid for interest | $ 1,234 | |
A Series Redeemable Convertible Preference Shares | ||
Supplemental non-cash investing and financing activities | ||
Exchange of redeemable convertible preference shares | 445,159 | |
A-1 Series Redeemable Convertible Preference Shares | ||
Supplemental non-cash investing and financing activities | ||
Exchange of redeemable convertible preference shares | $ 95,091 |
Organization and Business
Organization and Business | 12 Months Ended |
Dec. 31, 2020 | |
Organization and Business | |
Organization and Business | 1. Organization and Business Canoo Inc. (“Canoo” or the “Company”) is a mobility technology company with a mission to bring EVs to everyone. We have developed a breakthrough EV platform that we believe will enable us to rapidly innovate, and bring new products addressing multiple use cases to market faster than our competition and at lower cost. Business Combination On December 21, 2020 (the “Closing Date”), Hennessy Capital Acquisition Corp. IV (“HCAC”) consummated the previously announced merger pursuant to that certain Merger Agreement and Plan of Reorganization, dated August 17, 2020 (the “Merger Agreement”), by and among HCAC, HCAC IV First Merger Sub, Ltd., an exempted company incorporated with limited liability in the Cayman Islands and a direct, a wholly owned subsidiary of HCAC (“First Merger Sub”), EV Global Holdco LLC (f/k/a HCAC IV Second Merger Sub, LLC), a Delaware limited liability company and a direct, wholly owned subsidiary of HCAC (“Second Merger Sub”), and Canoo Holdings Ltd., an exempted company incorporated with limited liability in the Cayman Islands (“Legacy Canoo”). Pursuant to the terms of the Merger Agreement, a business combination between HCAC and Legacy Canoo was effected through the merger of (a) First Merger Sub with and into Legacy Canoo, with Legacy Canoo surviving as a wholly-owned subsidiary of HCAC (Legacy Canoo, in its capacity as the surviving corporation of the merger, the “Surviving Corporation”) and (b) the Surviving Corporation with and into Second Merger Sub, with Second Merger Sub being the surviving entity, which ultimately resulted in Legacy Canoo becoming a wholly-owned direct subsidiary of HCAC (all transactions collectively, the “Business Combination”). On the Closing Date, and in connection with the closing of the Business Combination, HCAC changed its name to Canoo Inc. and the Company’s common stock (“Common Stock”) began trading on The Nasdaq Global Select Market under the ticker symbol GOEV. For more information on this transaction see Note 4. Legacy Canoo was deemed to be the accounting acquirer in the Business Combination based on an analysis of the criteria outlined in Accounting Standards Codification (“ASC”) 805. While HCAC was the legal acquirer in the Business Combination, because Legacy Canoo was deemed the accounting acquirer, for accounting purposes, the transaction was treated as a recapitalization of Legacy Canoo (i.e., a capital transaction involving the issuance of stock by HCAC for the stock of Legacy Canoo). Accordingly, the consolidated assets, liabilities and results of operations of Legacy Canoo became the historical financial statements of the combined company, and HCAC’s assets, liabilities and results of operations were consolidated with Legacy Canoo, upon the consummation of the Business Combination. The net assets of HCAC are recognized at historical cost (which is expected to be consistent with carrying value), with no goodwill or other intangible The financial statements included in this report reflect (i) the historical operating results of Legacy Canoo prior to the Business Combination; (ii) the combined results of HCAC and Legacy Canoo following the closing of the Business Combination; (iii) the assets and liabilities of Legacy Canoo at their historical cost; and (iv) the Company’s equity structure for all periods presented. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies A summary of the significant accounting policies followed by the Company in the preparation of the accompanying financial statements is set forth below. Retroactive Application of Recapitalization As discussed in Note 4, our Business Combination on December 21, 2020 is accounted for as a recapitalization of equity structure. Pursuant to Generally Accepted Accounting Principles (“GAAP”), we recasted the Company’s consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity from December 31, 2018 to December 21, 2020, the total stockholder’s equity (deficit) within the Company’s consolidated balance sheet as of December 31, 2019 and the weighted average outstanding shares basic and diluted for the year ended December 31, 2019 by applying the recapitalization retroactively. Retroactive Application of Recapitalization to Consolidated Statements of Redeemable Convertible Preference Shares and Stockholders’ (Deficit) Equity As of the Business Combination on December 21, 2020, all 110.3 million shares of Legacy Canoo A series and A-1 series redeemable convertible preference shares of Legacy Canoo (“A/A-1 Shares”) were automatically exchanged into Legacy Canoo ordinary shares at a 1:1 ratio, which were converted again to our Common Stock at a conversion ratio of 1.239434862. The 110.3 million shares consisted of three previous conversions from the Legacy Canoo’s Angel series and Seed series redeemable convertible preference shares and convertible debt. 12/21/20 Redeemable Merger Convertible 08/16/20 A /A-1 Shares Recapitalization Recapitalized Preference Conversion And Conversion Common Date Description Shares Ratio Ordinary Shares Ratio Shares Shareholders' Equity Statement 12/31/2018 Angel Shares 77,000,000 0.54 41,403,247 1.24 51,316,627 3/4/2019 Seed Shares 16,666,667 0.54 8,961,742 1.24 11,107,496 5/6/2019 Seed Shares 16,666,666 0.54 8,961,741 1.24 11,107,495 Shareholders' Equity Statement 12/31/2018 Convertible Debt 51,006,603 1.24 63,219,362 1) Legacy Canoo redeemable convertible preference shares – Angel Series (“Angel Shares”) was outstanding at December 31, 2018 with 77.0 million shares, which were initially converted to 41.4 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 41.4 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 51.3 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 77.0 million shares of Angel Shares outstanding was converted and presented as 51.3 million shares of Common Stock at December 31, 2018. 2) Legacy Canoo redeemable convertible preference shares – Seed Series (“Seed Shares”) was issued on March 4, 2019 and May 6, 2019 with 16.7 million shares and 16.6 million shares, respectively, which were initially converted to 17.9 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 17.9 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 22.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 33.3 million shares of Seed Shares are converted and presented as 22.2 million shares of Common Stock issued during the year ended December 31, 2019. 3) Legacy Canoo convertible debt (“Convertible Debt”) – On August 16, 2020, all Convertible Debt was initially converted to 51.0 million shares of A/A-1 Shares, which were later exchanged into 51.0 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 63.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 51.0 million shares of A/A-1 Shares outstanding is converted and presented as 63.2 million shares of Common Stock issued during the year ended December 31, 2020. Unless otherwise indicated, all other Legacy Canoo ordinary shares as well as previously issued Legacy Canoo share options, restricted ordinary shares and restricted stock units (“RSUs”) presented in the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity and/or in the related notes are presented on an as- or as if-converted basis, converted at the ratio of 1.239434862 and presented as shares or awards of our Common Stock. Retroactive Application of Recapitalization to Consolidated Statements of Operations Based on the retroactive application of recapitalization to our consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity, we recalculated the weighted-average shares for the year ended December 31, 2019. The basic and diluted weighted-average Legacy ordinary shares are retroactively converted to Common Shares to conform to the recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity. The following table summarizes the weighted-average Common Shares, basic and diluted for the year ended December 31, 2019 after factoring all retroactive application of recapitalization. 12/21/20 Weighted As Merger Recapitalized Days Average Previously Conversion Common Outstanding % of Common Date Description Reported Ratio Stock in 2019 weighting Shares 2019 Weighted-average shares, basic and diluted 4,622,051 1.24 5,728,731 100 % 5,728,731 12/31/2018 Angel Shares 51,316,627 366 100 % 51,316,627 3/4/2019 Seed Shares 11,107,496 303 83 % 9,195,550 5/6/2019 Seed Shares 11,107,495 240 66 % 7,283,603 73,524,511 Retroactive Application of Recapitalization to Consolidated Balance Sheets To conform to the retroactive application of recapitalization to our consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity, we reclassified the $100.0 million of Angel Shares and the $100.0 million of Seed Shares to the additional paid in capital as of December 31, 2019. Basis of Presentation The Company’s consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. The consolidated financial statements include the results of Canoo Inc. and its subsidiaries. Our comprehensive loss is the same as our net loss. All intercompany transactions and balances have been eliminated in the consolidation. COVID-19 The impact of COVID-19, including changes in consumer and business behavior, pandemic fears and market downturns and restrictions on business and individual activities, has had, and is expected to continue to have, an adverse impact on the economies and financial markets of many countries, including the geographical areas in which Canoo operates. Specifically, the COVID-19 pandemic has caused disruption in the manufacturing, delivery and overall supply chain of vehicle manufacturers and suppliers, which may have an adverse impact on the production schedule of our EVs and our other business prospects and operations. As the COVID-19 pandemic continues to evolve, the extent of the impact to Canoo’s businesses, operating results, cash flows, liquidity and financial condition will be primarily driven by the severity and duration of the pandemic, the pandemic’s impact on the U.S. and global economies and the timing, scope and effectiveness of federal, state and local governmental responses to the pandemic. Those primary drivers are beyond Canoo’s knowledge and control and, as a result, at this time, Canoo is unable to predict the cumulative impact, both in terms of severity and duration, that the COVID-19 pandemic will have on Canoo’s business, operating results, cash flows and financial condition. Although Canoo has made its best estimates based upon current information, actual results could materially differ from the estimates and assumptions developed by management. Accordingly, it is reasonably possible that the estimates made in the consolidated financial statements have been, or will be, materially and adversely impacted in the near term as a result of these conditions, and if so, Canoo may be subject to future impairment losses related to long-lived assets as well as changes in the fair value of its financial instruments. Segment and Geographic Information Our principal executive officer, as the chief operating decision maker, organizes the Company, manages resource allocations and measures performance on the basis of one operating segment. All of the Company’s property and equipment and right of use assets are located in the United States of America. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. On an ongoing basis, management evaluates its estimates, including those related to i) useful lives of property and equipment; ii) the realization of deferred tax assets and estimates of tax reserves; iii) the valuation of equity securities and stock-based compensation; iv) the recognition and disclosure of contingent liabilities; and v) the fair value of financial instruments. These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. The Company may engage third party valuation specialists to assist with estimates related to the valuation of the underlying value of its assets, liabilities and equity. Such estimates often require the selection of appropriate valuation methodologies and models, and significant judgment in evaluating ranges of assumptions and financial inputs. Cash and Cash Equivalents Cash and cash equivalents consist of investments that are highly liquid, readily convertible to cash and which have an original maturity date within three months from the date of purchase as well as savings, checking and other bank accounts. Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents. The Company, at times, maintains cash and cash equivalent balances at financial institutions in excess of amounts insured by United States government agencies or payable by the United States government directly. The Company places its cash with high credit quality financial institutions . Restricted Cash We did not have any restricted cash at December 31, 2020. The 2019 restricted cash was required by our bank as a security deposit for our employee credit card program. Property and Equipment Property and equipment is stated at historical cost less accumulated depreciation. Depreciation is provided on property and equipment over the estimated useful lives on a straight-line basis. Expenditures for repairs and maintenance are expensed as incurred. Useful lives by asset category are as follows: Assets category Years Leasehold improvements Shorter of lease term or estimated useful life Machinery and equipment 3 years Furniture and fixtures 5 years Computer hardware and software 3 years Vehicles 3 years Leases On January 1, 2018, the Company early adopted Accounting Standards Codification (“ASC”) No. 842, Leases The operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The operating lease ROU assets and operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company estimates an incremental borrowing rate based on the estimated market rate of interest for a collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease right-of-use asset also includes any lease payments made prior to the lease commencement date. Lease expense for operating leases is recognized on a straight-line basis over the lease term. The determination of the lease term includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company has elected to exclude short-term leases (i.e., leases with expected terms of 12 months or less) from the recognition requirements of ASC 842, and has elected to account for lease and certain non-lease components as a single component. At December 31, 2020, the Company had only one operating lease for its corporate headquarters in Torrance, California. See Note 10 “Related Party Lease” for additional information. Impairment of Long-Lived Assets The Company assesses the carrying value of its long-lived assets, consisting primarily of property and equipment and lease ROU assets, when there is evidence that events or changes in circumstances indicate that the carrying value of an asset or group of assets may not be recoverable. Such events or changes in circumstances may include a significant decrease in the market price of a long-lived asset, a significant change in the extent or manner in which an asset is used, a significant change in legal factors or in the business climate, a significant deterioration in the amount of revenue or cash flows expected to be generated from a group of assets, a current expectation that, more likely than not a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life, or any other significant adverse change that would indicate that the carrying value of an asset or group of assets may not be recoverable. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable and the expected undiscounted future cash flows attributable to the asset group are less than the carrying amount of the asset group, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. To date, the Company has not recorded any impairment losses on long-lived assets. Income Taxes The company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company recognizes the tax benefit from uncertain tax positions only if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income tax matters in income tax expense. Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements and Disclosures ● Level 1 Quoted prices in active markets for identical assets or liabilities. ● Level 2 Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active for identical or similar assets and liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 Valuations are based on inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. As allowed by ASC 820, we have elected fair value accounting for our convertible notes. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The following table summarizes the Company’s liabilities that are measured at fair value on a recurring basis as required by ASC 820, by level, within the fair value hierarchy as of December 31, 2020 and 2019 (in thousands): December 31, 2020 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 702,422 $ 702,422 $ — $ — Liability Contingent earnout shares liability $ 133,503 $ — $ — $ 133,503 December 31, 2019 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 28,182 $ 28,182 $ — $ — Liability Related party derivative liability $ 17,797 $ — $ — $ 17,797 As described in Note 11, the Company has a contingent obligation to issue 15.0 million shares of our Common Stock to certain stockholders and employees (i.e., the Earnout Shares, defined below). Upon the occurrence of a bankruptcy or liquidation, any unissued Earnout Shares would be fully issued regardless of whether the share price target has been met. The Earnout Shares are accounted for as a contingent liability and its fair value is determined using Level 3 inputs, since estimating the fair value of this contingent liability requires the use of significant and subjective inputs that may and are likely to change over the duration of the liability with related changes in internal and external market factors. The tranches were valued using the Monte Carlo simulation of the stock prices based on historical and implied market volatility of a peer group of public companies. Following is a summary of the change in fair value of contingent Earnout Shares (defined below) liability for the year ended December 31, 2020 (in thousands). Beginning fair value $ — Addition during the year 248,878 Change in fair value during the year (115,375) Ending fair value $ 133,503 Following is a summary of the change in fair value of related party derivative liability for the year ended December 31, 2020 and 2019 (in thousands). Year Ended December 31, 2020 2019 Beginning fair value $ 17,797 $ — Addition during the year — 17,797 Change in fair value during the year (17,797) — Ending fair value $ — $ 17,797 The Company’s contingent Earnout Shares liability and embedded derivative liability on its convertible notes are considered a “Level 3” fair value measurement. Refer to Note 11 and Note 7, respectively, for discussion of the Company’s methods for valuation. Contingent Earnout Shares Liability The Business Combination provide certain stockholders and employees with the contingent right to up to an additional 15.0 million shares of our Common Stock (the “Earnout Shares”). Issuances are made in three tranches of 5.0 million shares each upon reaching share price targets within specified time frames. The first tranche will be issued if the share price reaches $18 within two years of the closing of the Business Combination. The second tranche will be issued if the share price reaches $25 within four years of the closing of the Business Combination. The third tranche will be issued if the share price reaches $30 within five years of the closing of the Business Combination. The tranches may also be issued upon a change of control transaction that occurs within the respective timeframes and results in per share consideration exceeding the respective share price target. Additionally, the full 15.0 million Earnout Shares will be issued in the event of a liquidation or bankruptcy. The Company determined that the right to Earnout Shares represents a contingent liability that meets the definition of a derivative and recognized it on the balance sheet at its fair value upon the Business Combination date. The right to Earnout Shares is remeasured at fair value each period through earnings. See Note 11 for further discussion. Our financial instruments not subject to ASC 820 include cash and cash equivalents, restricted cash, accounts payable and other current liabilities. The carrying amounts of these instruments approximated fair value because of their short-term maturities on December 31, 2020. Revenue Recognition The Company applies ASC 606, which governs how the Company recognizes revenue. Under ASC 606, the Company recognizes revenue when the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company recognizes revenue pursuant to the five-step framework contained in ASC 606: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies the performance obligations. During 2020, the Company's revenue was derived from the provision of consulting services on a project basis. The Company's fixed price contracts related to these services contain a single performance obligation, which was satisfied in July 2020 when the Company provided the final report to the customer. Revenue for these services was recognized at a point in time, when the project was delivered. Sales taxes are not included in our gross revenue. There were no contract liabilities as of December 31, 2020 and 2019. Cost of Revenue, excluding Depreciation Cost of revenue, excluding depreciation, includes materials, labor, and other direct costs related to the provision of engineering, development, and design consulting services. Research and Development Expenses , excluding Depreciation Research and development expenses, excluding depreciation consists of salaries, employee benefits and expenses for design and engineering personnel, stock-based compensation, as well as materials and supplies used in research and development activities. In addition, research and development expenses include fees for consulting and engineering services from third party vendors. The Company allocates a portion of overhead costs which includes lease expense, utilities and worker’s compensation premiums to the research and development department expense based on headcount. Selling, General and Administrative Expenses, excluding Depreciation The principal components of our selling, general and administrative expenses are salaries, wages, benefits and bonuses paid to our employees; stock-based compensation; travel and other business expenses; professional services fees (including legal, audit and tax); and ordinary day-to-day business expenses. Depreciation Expense Depreciation is provided on property and equipment over the estimated useful lives on a straight-line basis. Upon retirement or disposal, the cost of the asset disposed of and the related accumulated depreciation are removed from the accounts and any gain or loss is reflected in the loss from operations. No depreciation expense is allocated to research and development, cost of revenue and general and administrative expense. Loss Contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs for loss contingencies are expensed as incurred. Stock-based compensation The Company accounts for stock-based compensation awards granted to employees and directors based on the awards’ estimated grant date fair value. The Company estimates the fair value of its share options using the Black-Scholes option-pricing model. For awards that vest solely based on continued service (“service-only vesting conditions”), the resulting fair value is recognized on a straight-line basis over the period during which an employee is required to provide service in exchange for the award, usually the vesting period, which is generally four years For purposes of calculating stock-based compensation, we estimate the fair value of our stock options using the Black-Scholes option-pricing model, which requires the use of certain subjective assumptions including liquidity dates, volatility, discount rates, the risk-free rate and the fair value of our Common Stock. These assumptions generally require significant judgment and involve inherent uncertainties, which can materially affect the estimate of the fair value of our stock options and ultimately how much stock-based compensation expense is recognized. Prior to our Business Combination on December 21, 2020, the fair value of our RSUs is based on the fair value of the Legacy Canoo’s ordinary shares on the date of grant. As there is no public market for the Legacy Canoo’s ordinary shares, Legacy Canoo, with the assistance of a third-party valuation specialist, determined the fair value of the Legacy Canoo’s ordinary shares at the time of the grant of RSUs by considering a number of objective and subjective factors, including the likelihood of achieving a liquidity event and transactions involving the Legacy Canoo’s ordinary shares, among other factors. The fair value of the Legacy Canoo’s ordinary shares was derived from the Legacy Canoo’s total equity value divided by the number of shares outstanding and was estimated using a probability-weighted expected return model, using different probability weightings estimated for public offering scenario, M&A scenario and dissolution scenario. The factors and scenario weighting estimates require significant judgment involve inherent uncertainties, which can materially affect the estimate of the fair value of our RSUs and ultimately how much Stock-based compensation expense is recognized. After December 21, 2020, we estimate the fair value of RSUs based on the market price of our Common Stock underlying the awards on the grant date. Fair value for awards with our stock price performance metrics is calculated using the Monte Carlo simulation model, which incorporates stock price correlation and other variables over the time horizons matching the performance periods. For the years ended December 31, 2020 and December 31, 2019 total stock-based compensation expense was $84.3 million and $1.9 million, respectively. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2020 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | 3. Recent Accounting Pronouncements Changes to generally accepted accounting principles in the United States (GAAP) are established by the Financial Accounting Standards Board (“FASB”), in the form of Accounting Standards Updates (“ASUs”), to the FASB’s Accounting Standards Codification. We consider the applicability and impact of all ASUs. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position and results of operations. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Simplifying the Accounting for Income Taxes related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The new guidance also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. This guidance is effective for fiscal years beginning after December 15, 2021 and for interim periods within fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company is currently evaluating this guidance to determine the impact it may have on the consolidated financial statements. In August 2020, the FASB issued ASU No. 2020-06 Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2020 | |
Business Combination | |
Business Combination | 4. Business Combination On December 21, 2020, we consummated the Business Combination. Immediately prior to closing of the Business Combination, each Legacy Canoo preference share that was issued and outstanding was automatically converted into a number of Legacy Canoo ordinary shares on a 1:1 basis (which reflected the then-effective conversion rate as calculated pursuant to the Second Amended and Restated Memorandum and Articles of Association of Legacy Canoo). Upon the consummation of the Business Combination, each Legacy Canoo ordinary share issued and outstanding was canceled and converted into the right to receive (i) 1.239434862 shares (the “Exchange Ratio”) of Common Stock, and (ii) the contingent right to receive Earnout Shares, (which consideration, collectively, shall hereinafter be referred to as the “Per Share Merger Consideration”). Upon the closing of the Business Combination, HCAC's certificate of incorporation was amended and restated to, among other things, increase the total number of authorized shares of all classes of capital stock to 510,000,000 shares, of which 500,000,000 shares were designated Common Stock, $0.0001 par value per share, and of which 10,000,000 shares were designated preferred stock, $0.0001 par value per share. On August 17, 2020, a number of purchasers (each, a “Subscriber”) purchased from HCAC an aggregate of 32,325,000 shares of our Common Stock (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $323.3 million, pursuant to separate subscription agreements (the “Subscription Agreements”) entered into effective as of August 17, 2020. Pursuant to the Subscription Agreements, we gave certain registration rights to the Subscribers with respect to the PIPE Shares. The sale of the PIPE Shares was consummated concurrently with the consummation of the Business Combination. Legacy Canoo was deemed to be the accounting acquirer in the Business Combination based on an analysis of the criteria outlined in ASC 805. While HCAC was the legal acquirer in the Business Combination, because Legacy Canoo was deemed the accounting acquirer, for accounting purposes, the transaction was treated as a recapitalization of Legacy Canoo (i.e., a capital transaction involving the issuance of stock by HCAC for the stock of Legacy Canoo). Accordingly, the consolidated assets, liabilities and results of operations of Legacy Canoo became the historical financial statements of the combined company, and HCAC's assets, liabilities and results of operations were consolidated with Legacy Canoo beginning on the acquisition date. The net assets of HCAC are recognized at historical cost (which is expected to be consistent with carrying value), with no intangible The following table reconciles the elements of the Business Combination to the consolidated statement of cash flows and the consolidated statement of changes in equity for the year ended December 31, 2020 (in thousands): Recapitalization Cash - HCAC's trust and cash (net of redemptions) $ 306,354 Cash - PIPE 323,250 Less transaction costs and advisory fees paid (22,508) Net Business Combination and PIPE financing 607,096 Add: non-cash net assets assumed from HCAC 40 Net contributions from Business Combination and PIPE financing $ 607,136 The number of shares of Common Stock issued immediately following the consummation of the Business Combination: Number of Shares Common stock, outstanding prior to Business Combination 29,730,204 Less redemption of HCAC shares (9,571) Common stock of HCAC 29,720,633 HCAC Founder Shares 7,503,750 Shares issued in PIPE 32,325,000 Business Combination and PIPE financing shares 69,549,383 Legacy Canoo shares (1) 166,155,697 Total shares of Common Stock immediately after Business Combination 235,705,080 (1) The number of Legacy Canoo shares was determined from the 134.1 million shares of Legacy Canoo ordinary shares outstanding immediately prior to the closing of the Business Combination converted at the Exchange Ratio of 1.239434862 . All fractional shares were rounded down. In addition, Legacy Canoo shareholders are entitled to receive additional Common Shares of up to an aggregate of 15.0 million shares if the price of our Common Stock trading on the Nasdaq meets certain thresholds following the Business Combination. Pursuant to GAAP, the Company determined the Earnout Shares right to be a derivative liability. See Note 11 for additional information. |
Property and Equipment, net
Property and Equipment, net | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment, net | |
Property and Equipment, net | 5. Property and Equipment, net Property and equipment, net consisted of the following (in thousands): December 31, 2020 2019 Machinery and equipment $ 15,292 $ 8,946 Computer hardware 2,464 2,396 Computer software 5,159 3,675 Vehicles 63 95 Furniture and fixtures 519 512 Leasehold improvements 14,559 16,197 Construction-in-progress 5,283 — 43,339 31,821 Less: Accumulated depreciation (12,913) (5,811) Property and equipment, net $ 30,426 $ 26,010 Depreciation expense for property and equipment was $7.1 million and $4.7 million for the years ended December 31, 2020 and 2019, respectively. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Accrued Expenses | |
Accrued Expenses and Other Current Liabilities | 6. Accrued Expenses and Other Current liabilities Accrued expenses consisted of the following (in thousands): December 31, 2020 2019 Accrued interest expense $ 34 $ 4,708 Accrued property and equipment purchases 3,992 — Accrued research and development costs 2,420 2,195 Accrued professional fees 1,386 160 Accrued Business Combination costs 815 — Short term lease liability 444 368 Other accrued expenses 1,534 703 Total accrued expenses $ 10,625 $ 8,134 |
Long-term Debt, Convertible Deb
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | 12 Months Ended |
Dec. 31, 2020 | |
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | 7. Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares Long-Term Debt On July 7, 2020, Legacy Canoo entered into a promissory note for loan proceeds in the amount of $7.0 million under the Paycheck Protection Program (the “PPP”) (the “PPP Loan”) administered by the Small Business Administration (“SBA”) established under Division A, Title I of the CARES Act. The PPP Loan bears interest at 1.0% per annum, accruing from the loan date and payable monthly and matures on July 7, 2025. No payments are due on the PPP Loan until one month following the end of a deferment period of 68 weeks from the date of first disbursement, but interest will continue to accrue during the deferment period. The PPP Loan is unsecured and guaranteed by the SBA. The PPP Loan may be prepaid by the Company at any time prior to maturity with no prepayment penalties. The PPP Loan provides for customary defaults, including failure to make payment when due or to fulfill the Company’s obligations under the promissory note or related documents, reorganizations, mergers, consolidations or other changes to the Company’s business structure, and certain defaults on other indebtedness, bankruptcy events, adverse changes in financial condition or civil or criminal actions. The PPP Loan may be accelerated upon the occurrence of a default. The PPP provides for loans to qualifying businesses for amounts up to 2.5 times the average monthly payroll expenses of the business, subject to certain limitations. The PPP Loan and accrued interest are forgivable after twenty-four weeks so long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities. The total amount eligible for forgiveness may be adjusted if, at the time of the forgiveness application, the borrower does not maintain employment and wage levels; a forgiveness application may be submitted at any time prior to December 31, 2020. During October 2020, Legacy Canoo submitted its application for forgiveness of the PPP Loan. The Company has and intends to continue to use the PPP Loan proceeds for purposes consistent with the provisions of the PPP and the Company expects that such usage will meet the criteria established for forgiveness of the loan. Whether forgiveness will be granted and in what amount is subject to an application to, and approval by, the SBA and may also be subject to further requirements in any regulations and guidelines the SBA may adopt. If all or a portion of the loan is ultimately forgiven, the Company will record income from the extinguishment of the PPP Loan. The Company accounts for the PPP Loan as debt and the loan proceeds as a financing activity in the consolidated statements of cash flows for the year ended December 31, 2020. As of December 31, 2020, the PPP loan of $7.0 million approximated its fair value. Convertible Debt In August 2019, Legacy Canoo issued $100 million aggregate principal amount of secured convertible notes (the “$100M Notes”) to certain existing investors in Legacy Canoo. The $100M Notes accrued simple interest at 12% per year. Unless earlier repaid, converted or extended by the investors, outstanding principal and unpaid accrued interest on the $100M Notes were due on February 28, 2021 (“Maturity Date”). The original terms of the $100M Notes stated that in the event the Company consummates, after August 1, 2019 and on or prior to the Maturity Date, an equity financing pursuant to which it sells shares of its equity securities with an aggregate sales price of not less than $200 million, excluding any and all indebtedness under the $100M Notes that is converted, then all principal, together with all unpaid accrued interest under the $100M Notes, would automatically convert into shares of the equity securities at 80% of the cash price per share paid by the other purchasers of equity securities. In March 2020, certain terms of the $100M Notes were amended such that (1) the Maturity Date was extended from February 28, 2021 to September 23, 2021 and (2) the $100M Notes are automatically converted into the next round of equity securities at the lesser of (a) 80% of the cash price per share paid by the other purchasers of equity securities; or (b) $500 million divided by the total number of outstanding shares at the time of conversion. In addition, the amendment provided that the noteholders can elect to convert the $100M Notes if there is a change in control after September 2020 at the lesser of (a) 80% of the inferred value per share paid for control of Legacy Canoo and (b) $500 million divided by the total number of outstanding shares at the time of conversion. In consideration of these more favorable conversion terms, the equity holders of the $100M Notes agreed to forgive all unpaid and accrued interest through the amendment date, which totaled $7.4 million. The Company accounted for these changes in terms of its $100M Notes as a debt extinguishment. The Company recognized a gain on extinguishment of $8.3 million as an effective capital contribution within additional paid-in capital as each of the holders of the $100M Notes were existing equity holders in the Company. The extinguishment gain represents the difference between: (a) the sum of the carrying value of the pre-amendment $100M Notes of $88.7 million, the value of unpaid accrued interest through the amendment date of $7.4 million, and the fair value of the embedded derivative of $17.7 million; and (b) the fair value of the amended $100M Notes of $105.6 million at the time of the amendment. Prior to the March 23, 2020 amendment, the Company had not elected the fair value option to record the notes at fair value in its entirety, and as such bifurcated the contingent redemption feature embedded in the $100M Notes and recorded it at fair value separately as an embedded derivative liability. The fair value of the embedded derivative liability at issuance was recorded as a discount to the $100M Notes. From January 1, 2020 through March 23, 2020, Legacy Canoo recorded expense of $2.6 million for the accretion of the debt discount in interest expense. Legacy Canoo assessed the fair value of the derivative liability as of March 23, 2020 and determined there was no material change in the fair value of the derivative liability from December 31, 2019 through the March 23, 2020 amendment date. At the time of the extinguishment, Legacy Canoo elected to account for the $100M Notes at fair value in their entirety. The fair value of the $100M Notes on March 23, 2020 was $105.6 million. The significant unobservable inputs used in the fair value measurement of the $100M Notes were the financial and operational performance of the Company, debt issued by Legacy Canoo with similar terms, and the probability of principal recovery of the investment. The difference in the fair value as compared to the principal value of the $100M Notes is primarily driven by the difference in interest rates between convertible debt issued by Legacy Canoo with similar terms. In March 2020, Legacy Canoo issued $15.0 million aggregate principal amount of secured convertible notes (the “$15M Notes”), of which $10.0 million was issued to certain existing investors in Legacy Canoo and the remaining $5.0 million to new noteholders. In April 2020, Legacy Canoo issued $10.3 million aggregate principal amount of secured convertible notes (“$10.3M Notes”) to new noteholders. The $15M Notes and the $10.3M Notes accrue simple interest at 8% per year. Unless earlier repaid, converted or extended by the noteholders, the outstanding principal and unpaid accrued interest on the $15M Notes and the $10.3M Notes are due on September 3, 2021 and September 23, 2021, respectively. In the event Legacy Canoo consummates an equity financing on or prior to the maturity date of the notes, pursuant to which it sells shares of its equity securities with an aggregate sales price of not less than $200 million, excluding any and all indebtedness under the note that is converted, then all principal, together with all unpaid accrued interest under the notes, shall automatically convert into shares of the equity securities at the lesser of (a) 80% of the cash price per share paid by the other purchasers of equity securities or (b) the price obtained by dividing $500 million by the number of outstanding shares. In addition, the noteholders of the $15M Notes and the $10.3M Notes can elect to convert the notes if there is a change in control after September 2020 at the lesser of (a) 80% of the inferred value per share paid for control of the Company and (b) $500 million divided by the total number of outstanding shares at the time of conversion. At the date of issuance, Legacy Canoo assessed the fair values of the $15M Notes and $10.3M Notes to be equal to the principal amount of these notes. There were no changes in the fair values of the $15M Notes and the $10.3M Notes between their respective issuance dates and August 16, 2020 when these convertible notes were included in the exchange of all convertible notes into A series and A-1 series of Legacy Canoo redeemable convertible preference shares. During the period from July to August 2020, Legacy Canoo issued a total of $155.3 million aggregate principal amount of secured and unsecured convertible notes (“$155.3M Notes”), of which $80.0 million were issued to certain related party investors and the remaining $75.3 million to new noteholders. The $155.3M Notes accrued simple interest at 8% per year. Other than the change in the interest rate, these new notes had the same terms and conditions as the amended $100M Notes. At the date of issuance, Legacy Canoo assessed the fair values of the $155.3M Notes to be equal to the principal amount of these notes. For notes recorded at fair value, any change in fair value from a change in instrument-specific credit risk is recognized in our consolidated statement of operations. During the year ended December 31, 2020, there was no gain or loss recognized attributable to instrument-specific credit risk of the underlying convertible notes based upon the Company’s assessment of its own creditworthiness and risk of default. Exchange of Debt and Preference Shares Exchange of Debt: On August 16, 2020, all of Legacy Canoo’s outstanding convertible notes with an aggregate principal amount of $280.5 million were exchanged for 31.6 million of Legacy Canoo A series redeemable convertible preference shares and 19.4 million of Legacy Canoo A-1 series redeemable convertible preference shares. Immediately prior to the exchange, Legacy Canoo assessed the fair value of all of its convertible debt to be $286.1 million. The significant unobservable inputs used in the fair value measurement of the outstanding Legacy Canoo convertible notes were the financial and operational performance of Legacy Canoo, debt issued by Legacy Canoo with similar terms, and the fair value of the Legacy Canoo redeemable convertible preference shares issued in exchange for the Legacy Canoo convertible notes. Legacy Canoo recorded $0.1 million as a change in fair value from March 2020 through August 2020 in interest expense in the consolidated statement of operations. No other fair value adjustments related to the Legacy Canoo convertible debt were recorded during the year ended December 31, 2020. Since the issuance of the new Legacy Canoo A series redeemable convertible preference shares and Legacy Canoo A-1 series redeemable convertible preference shares on the exchange of the Legacy Canoo convertible debt was outside the contractual terms of the Legacy Canoo debt agreements, Legacy Canoo accounted for the exchange of all of Legacy Canoo’s outstanding convertible notes as an extinguishment of debt. Legacy Canoo recognized a total gain on extinguishment of $41.6 million, of which $36.5 million was treated as an effective capital contribution within stockholders’ equity as this portion related to existing investors in Legacy Canoo, and $5.0 million was recorded within gain on extinguishment of debt in the consolidated statement of operations for the year ended December 31, 2020. The extinguishment gain represents the difference between: (a) the sum of the adjusted carrying value of the Legacy Canoo Notes of $286.1 million, and the value of unpaid accrued interest through the amendment date of $5.2 million; and (b) the fair value of the Legacy Canoo A series and A-1 series redeemable convertible preference shares issued of $249.8 million. At the date of the exchange, the holders of the Legacy Canoo convertible notes agreed to forgive all unpaid and accrued interest through that date. The fair value was determined based on the most recent conversion price of the Legacy Canoo convertible debt for Legacy Canoo A series redeemable convertible preference shares and A-1 series redeemable convertible preference shares. Exchange of Preference Shares: Concurrently with the conversion of the Legacy Canoo convertible debt, 77.0 million Legacy Canoo Angel series redeemable convertible preference shares and 33.3 million Legacy Canoo seed series redeemable convertible preference shares were exchanged for 59.3 million Legacy Canoo A series redeemable convertible preference shares. The company quantitatively assessed the terms of the exchange and accounted for the exchange as an extinguishment of its Legacy Canoo Seed series redeemable convertible preference shares and Legacy Canoo Angel series redeemable convertible preference shares, and recorded the Legacy Canoo A series redeemable convertible preference shares at their fair values as of the recapitalization date. Accordingly, Legacy Canoo recognized a loss on extinguishment of $90.5 million as a deemed dividend to the Legacy Canoo redeemable convertible preference shareholders. The loss represents the difference between: (1) the $200.0 million aggregate carrying amount of the Legacy Canoo Seed series redeemable convertible preference shares and Legacy Canoo Angel series redeemable convertible preference shares immediately prior to the exchange; and (2) the $290.5 million fair value of the Legacy Canoo A series redeemable convertible preference shares issued. The fair value was determined based on the most recent conversion price of the Legacy Canoo convertible debt for the Legacy Canoo A series redeemable convertible preference shares. The loss on extinguishment first reduced Legacy Canoo’s additional paid-in capital (“APIC”) to zero and then the excess was recorded in accumulated deficit. When these Legacy Canoo A series preference shares were exchanged to Legacy Canoo ordinary shares on December 21, 2020, the $90.5 million of gain in the fair value of the Legacy Canoo A series preference shares and the corresponding loss of $90.5 million on extinguishment recorded to APIC and accumulated deficit for Legacy Canoo ordinary shares were net to zero dollar impact within APIC and accumulated deficit given the equity recast upon recapitalization. See Note 2 for additional discussion on the recapitalization recast. Dividends The holders of the Legacy Canoo redeemable convertible preference shares were entitled to receive cumulative and compounding dividends in an amount equal to 8% of the original issuance price per share per annum. Dividends accrued from day to day, whether or not declared, and were cumulative; provided, however, that such accrued dividends were payable only in the event of either a Liquidation Event or a Non-Liquidation Sale. Such cumulative dividends in arrears were approximately $42.0 million at December 21, 2020. For the years ended December 31, 2020 and 2019, no dividends were declared. Exchange of A Series and A-1 Series Redeemable Convertible Preference Shares at The Business Combination At the Business Combination on December 21, 2020, all 110.3 million shares of the Legacy Canoo A series and A-1 series redeemable convertible preference shares were exchanged into 110.3 million shares of Legacy Canoo ordinary shares, which were subsequently converted to 136.8 million shares of our Common Stock at the Exchange Ratio of 1.239434862. The cumulative dividends of $42.0 million accrued for the Legacy Canoo A series and A-1 series redeemable convertible preference shares at December 21, 2020 were not declared nor converted to our Common Stock. |
Related Party Promissory Note a
Related Party Promissory Note and Convertible Debt | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Promissory Note | |
Related Party Promissory Note and Convertible Debt | 8. Related Party Promissory Note and Convertible Debt In November 2018, Legacy Canoo issued an unsecured promissory note for $15.0 million with two entities controlled by certain of Legacy Canoo’s investors. All principal amounts together with unpaid and accrued interest were due and payable in full at the earlier of (i) the issuance of new equity or any debt instrument convertible into equity by Legacy Canoo, other than certain restricted shares or shares granted under the Legacy Canoo 2018 Share Option and Grant Plan (the “2018 Equity Plan”) or (ii) November 6, 2019. Interest on the unpaid balance of the loan accrued at a rate of the LIBOR Index Rate plus 8% per year (10.875% at December 31, 2019), payable on the maturity date of the loan. At December 31, 2018, the unpaid principal was $15.0 million and accrued interest was approximately $0.3 million. In February 2019, Legacy Canoo repaid $5.0 million of the principal and $0.2 million of accrued interest. In November 2019, Legacy Canoo repaid the remaining principal balance of $10.0 million and $1.1 million of the accrued interest. In August 2019, the Company issued a $100.0 million aggregate principal amount of secured convertible notes (the “$100M Notes”) with certain existing investors in the Company. The $100M Notes accrue simple interest at 12% per year. Unless earlier repaid, converted or extended by the investors, outstanding principal and unpaid accrued interest on the $100M Notes is due on February 28, 2021, which was subsequently amended to September 23, 2021 (“Maturity Date”). The automatic conversion feature at a discount to the next equity financing represents an embedded contingent redemption feature. The Company has bifurcated the contingent redemption feature from the $100M Notes and accounted for it separately as an embedded derivative liability. The embedded derivative liability is remeasured to fair value each period. The embedded contingent redemption feature is bifurcated from the $100M Notes because (i) a separate instrument with the same terms as the embedded derivative would be a derivative, and (ii) the economic characteristics of the embedded contingent redemption feature are not clearly and closely related to $100M Notes as it is contingently exercisable and results in the settlement of the debt at a substantial premium. The fair value of the embedded derivative liability at issuance of $17.8 million was recorded as a discount to the $100M Notes. To estimate the fair value of the embedded derivative liability, management considered several scenarios, including the completion of an equity financing prior to the $100M Notes’ maturity, conversion to preference shares upon maturity and the Company defaulting on the $100M Notes, and the timing of such events. The fair values of each scenario were determined primarily by the terms of the $100M Notes and the value of the Company’s existing preference shares, and then were probability weighted based on management’s estimates of the likelihood of each scenario. The probability weighted values were then discounted to present value. The discounted carrying amount of the $100M Notes is accreted, using the effective interest method, over the expected term of the $100M Notes. The Company performed this analysis of the fair value of the embedded derivative liability as of the August issuance date. As of December 31, 2019, the Company performed its fair value analysis by reconsidering each of the assumptions in the fair value model including its assessment of the probability-weighted expected return method of each scenario outlined above. Based on this assessment, the Company determined that there were no material changes in the fair value of the embedded derivative liability from issuance to December 31, 2019. The carrying value of the $100M Notes at December 31, 2019 was $86.1 million, net of unamortized debt discount of $13.9 million. During 2019, the Company recorded interest expense of $3.8 million for the accretion of the debt discount. In March 2020, certain terms of the $100M Notes were amended such that (1) the Maturity Date was extended from February 28, 2021 to September 23, 2021 and (2) the $100M Notes are automatically converted into the next round of equity securities at the lesser of (a) 80% of the cash price per share paid by the other purchasers of equity securities; or (b) $500 million divided by the total number of outstanding shares at the time of conversion. In addition, the amendment provided that the noteholders can elect to convert the $100M Notes if there is a change in control after September 2020 at the lesser of (a) 80% of the inferred value per share paid for control of the Company and (b) $500 million divided by the total number of outstanding shares at the time of conversion. In consideration of these more favorable conversion terms, the equity holders of the $100M Notes agreed to forgive all unpaid and accrued interest through the amendment date, which totaled $7.4 million. The Company accounted for these changes in the terms of its $100M Notes as a debt extinguishment. The Company recognized a gain on extinguishment of $8.3 million as an effective capital contribution within additional paid-in capital as each of the holders of the $100M Notes were existing equity holders in the Company. The extinguishment gain represents the difference between: (a) the sum of the carrying value of the pre-amendment $100M Notes of $88.7 million, the value of unpaid accrued interest through the amendment date of $7.4 million, and the fair value of the embedded derivative of $17.7 million; and (b) the fair value of the amended $100M Notes of $105.6 million at the time of the amendment. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies | |
Commitments and Contingencies | 9. Commitments and Contingencies Lease Commitments Refer to Note 10 for information regarding operating lease commitments. Legal Proceedings From time to time, the Company may become subject to legal proceedings, claims and litigation arising in the ordinary course of business. If the Company determines that it is probable that a loss has been incurred and the amount is reasonably estimable, the Company will record a liability. The Company is not currently a party to any material legal proceedings, nor is the Company aware of any other pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably. Indemnifications In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to vendors, lessors, investors, directors, officers, employees and other parties with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third-parties. These indemnifications may survive termination of the underlying agreement and the maximum potential amount of future payments the Company could be required to make under these indemnification provisions may not be subject to maximum loss clauses. The Company provided indemnifications to certain of its officers and employees with respect to claims filed by a former employer. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Lease | |
Related Party Transactions | 10. Related Party Transactions On February 28, 2018, Legacy Canoo, via a wholly owned subsidiary, entered into a lease for an office facility in Torrance, California with an entity controlled by certain investors of Legacy Canoo, which was assigned to another entity controlled by certain investors of Legacy Canoo, on April 30, 2018. The original lease term is 15 years and commenced on April 30, 2018. The lease contains a 3% per annum escalation clause. Legacy Canoo is also required to pay the property taxes on the facility. Related party lease expense related to this operating lease was $1.7 million and $1.7 million for the years ended December 31, 2020 and 2019, respectively. During 2020 and 2019, Legacy Canoo made rent payments related to this operating lease in the amount of $1.5 million and $1.4 million, respectively. The lease contains the option to extend the term of the lease for two additional 60-month periods commencing when the prior term expires. At lease inception, Legacy Canoo was not reasonably certain it would exercise any of the options to extend the term of the lease. There have been no changes to that assessment as of December 31, 2020. The Company has determined that the lease does not effectively transfer control of the underlying facility to the Company based on the lease terms and, accordingly, the Company has classified the lease as an operating lease. As such, the rent and property taxes are expensed on a straight-line basis in the consolidated statements of operations. The Company used judgment in determining an appropriate incremental borrowing rate to calculate the operating lease right-of-use asset and operating lease liability for the lease. Upon commencement of the lease, the Company recorded an operating lease ROU asset and operating lease liability of approximately $14.5 million and $14.5 million, respectively, on the Company’s consolidated balance sheet. The incremental borrowing rate used to determine the lease liability was 7.9%. As of December 31, 2020, the remaining operating lease ROU asset and operating lease liability were approximately $12.9 million and $13.7 million, respectively. As of December 31, 2019, the remaining operating lease ROU asset and operating lease liability were approximately $13.5 million and $14.1 million, respectively. As of December 31, 2020 and 2019, $0.4 million and $0.4 million, respectively, of the lease liability was determined to be short term and was included in accrued expenses within the consolidated balance sheet. The weighted average remaining lease term at December 31, 2020 and 2019 was 12.3 years and 13.3 years, respectively. Maturities of the Company’s operating lease liabilities at December 31, 2020 were as follows (in thousands): Operating Lease 2021 $ 1,507 2022 1,553 2023 1,599 2024 1,647 2025 1,697 Thereafter 14,092 Total lease payments 22,095 Less: imputed interest (1) 8,389 Present value of operating lease liabilities 13,706 Current portion of operating lease liabilities 444 Operating lease liabilities, net of current portion $ 13,262 (1) Calculated using the incremental borrowing rate On November 25, 2020, Legacy Canoo entered into an agreement with Tony Aquila, Executive Chairman to reimburse Mr. Aquila for certain air travel expenses based on certain agreed upon criteria (“aircraft reimbursement”). The total aircraft reimbursement to Mr. Aquila for the use of an aircraft owned by Aquila Family Ventures, LLC (“AFV”), an entity controlled by Mr. Aquila, for the purposes related to the business of the Company for year ended December 31, 2020 was $541,000. |
Contingent Earnout Shares Liabi
Contingent Earnout Shares Liability | 12 Months Ended |
Dec. 31, 2020 | |
Embedded Derivative [Abstract] | |
Contingent Earnout Shares Liability | 11. Contingent Earnout Shares Liability As part of the Business Combination, certain stockholders and employees are entitled to additional consideration in the form of Earnout Shares of the Company’s Common Stock to be issued when our Common Stock’s price achieved certain market share price milestones within specified periods following the Business Combination on December 21, 2020. The Earnout Shares do not have employment requirement and shall be issued in tranches based on the following conditions: 1. If the closing share price of Common Stock equals or exceeds $18.00 per share for any 20 trading days within any consecutive 30 -trading day period prior to the two-year anniversary of the Closing Date (“$18 Milestone”), then the Company shall issue an aggregate of 5.0 million shares of Common Stock to holders with the contingent right to receive Earnout Shares. These shares may instead be issued in the event of a Change of Control prior to the two-year anniversary of the Closing Date if the per share consideration in such transaction is at least $18 . 2. If the closing share price of Common Stock equals or exceeds $25.00 per share for any 20 trading days within any consecutive 30 -trading day period prior to the four-year anniversary of the Closing Date (“$25 Milestone”), then the Company shall issue an aggregate of 5.0 million shares of Common Stock to holders with the contingent right to receive Earnout Shares. These shares may instead be issued in the event of a Change of Control prior to the four-year anniversary of the Closing Date if the per share consideration in such transaction is at least $25 . 3. If the closing share price of Common Stock equals or exceeds $30.00 per share for any 20 trading days within any consecutive 30 -trading day period prior to the five-year anniversary of the Business Combination Closing Date (“$30 Milestone”), then the Company shall issue an aggregate of 5.0 million shares of Common Stock to holders with the contingent right to receive Earnout Shares. These shares may instead be issued in the event of a Change of Control prior to the five-year anniversary of the Closing Date if the per share consideration in such transaction is at least $30 . Pursuant to the guidance under ASC 815, Derivatives and Hedging As of December 21, 2020, the initial fair value of our Earnout Shares liability was recognized at $248.9 million with a corresponding reduction from the additional paid-in capital in our stockholders’ (deficit) equity. As of December 31, 2020, the fair value of our Earnout Shares liability was estimated to be $133.5 million. We recognized a gain on the fair value change in Earnout Shares liability of $115.4 million as other income in our consolidated statement of operations. |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-Based Compensation | |
Stock-based Compensation | 12. Stock-based Compensation At our Business Combination on December 21, 2020, the Legacy Canoo 2018 Equity Plan was converted to the Company’s 2018 Equity Plan with the Legacy Canoo ordinary shares authorized for issuance pursuant to previously issued awards converted at the Exchange Ratio of 1.239434862 to the Company’s Common Stock and the exercise price per share option and purchase price per restricted shares decreased proportionately by the same conversion ratio. See additional discussion on the retroactive application of recapitalization in Note 2 of the notes to the accompany financial statements. In 2019, the Company increased the number of shares of the Company’s Common Stock reserved for issuance under the 2018 Equity Plan from 7,064,779 shares to 15,281,513 shares. In 2020, the 2018 Equity Plan was amended to increase the number of shares reserved for issuance to a new total of 18,162,573 shares reserved for issuance. On December 21, 2020, the stockholders of the Company approved the 2020 Equity Incentive Plan (the”2020 Equity Plan”) in a special meeting, authorizing 26,898,554 common shares to be reserved for issuance of stock options, restricted stock units awards and other stock awards. As of December 31, 2020, no stock options, restricted stock unit awards and other stock awards were granted under the 2020 Equity Plan. Stock Options All employees are eligible to be granted options to purchase shares of our Common Stock under the Company’s equity plans. All options granted will expire ten years from their date of issuance. Stock options granted generally vest 25% on the one-year anniversary of the date when vesting starts with the remaining balance vesting equally on a monthly basis over the subsequent 3 years All our stock options were issued under the Legacy Canoo 2018 Equity Plan. The fair values of stock options granted under the Legacy Canoo 2018 Equity Plan were estimated at the date of grant using the Black-Scholes option pricing model and the following weighted average valuation assumptions: December 31, 2020 2019 Risk free interest rates 1.62 % 1.69 % Expected lives (in years) 6.0 6.0 Dividend yield — — Expected volatility 60.0 % 60.0 % The following table summarizes the activity of the Company’s stock options for the year ended December 31, 2020 (in thousands, except weighted-average exercise price and weighted-average remaining contractual life): Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value Outstanding at December 31, 2019 1,512 $ 0.02 9.64 $ 637 Granted 209 $ 0.02 Forfeited (973) $ 0.01 Exercised (424) $ 0.02 Outstanding at December 31, 2020 324 $ 0.02 8.47 $ 137 Under the Legacy Canoo 2018 Equity Plan, employees may exercise stock options prior to vesting. The Company has the right to repurchase any unvested (but issued) shares upon termination of service of an employee at the original exercise price. The consideration received for the early exercise of an option is considered to be a deposit and the related amount is recorded as a liability. The liability is reclassified into additional paid-in capital as the award vests. The liability related to unvested stock options early exercised was $0.2 million and $0.1 million as of December 31, 2020 and 2019, respectively. The shares issued upon early exercise of stock options are considered issued and outstanding shares of our Common Stock. Of the stock options exercised during the twelve months ended December 31, 2020, 421,097 shares were unvested. As of December 31, 2020, of the total 235,753,437 shares of Common Stock issued and outstanding, 5,279,906 shares issued upon early exercise of stock options were unvested. As of December 31, 2020, of the total 324,298 stock options outstanding, 203,177 shares were unvested. The Company expects substantially all of these share options to vest over the subsequent 3 years. The intrinsic value of stock options exercised during the year ended December 31, 2020 and 2019 was $0.1 million and $3.3 million, respectively. This intrinsic value represents the difference between the fair market value of the Company’s shares of Common Stock on the date of exercise and the exercise price of each option The total grant date fair value of stock options granted during the years ended December 31, 2020 and 2019, was approximately $0.1 million and $3.5 million, respectively. The weighted average grant date fair value per share of stock options granted during the years ended December 31, 2020 and 2019 was $0.44 and $0.39, respectively. Stock-based compensation expense related to stock options was approximately $0.9 million during the year ended December 31, 2020, of which $0.7 million is included in research and development expenses and $0.2 million is reflected within selling, general and administrative expenses in the consolidated statements of operations. Stock-based compensation expense related to stock options was approximately $0.3 million during the year ended December 31, 2019, of which $0.1 million is included in research and development expenses and $0.2 million is included in selling, general and administrative expenses in the consolidated statements of operations. Total unrecognized compensation cost related to unvested stock options at December 31, 2020 and 2019 is approximately $2.0 million and $3.2 million, respectively. As of December 31, 2020 and 2019, the weighted average period over which the unrecognized compensation cost is expected to be recognized was approximately 1.7 and 2.8 years, respectively. Restricted Stock Awards The Company’s restricted stock awards (“RSAs”) consists of the following: Restricted Shares From November 4, 2018 to May 6, 2019, the Legacy Canoo sold restricted shares totaling 30,188,011 shares (as converted to Common Stock) to the founders, which include certain investors, for a converted purchase price of $0.008 per share (the “Founder Restricted Shares”), with the following vesting conditions: 12.5% vest when the Legacy Canoo achieves $100 million in cumulative funding from inception (which condition was satisfied December 18, 2018, accordingly this portion of the 2019 awards was vested upon issuance); 37.5% vest ratably over a period of thirty-six months from December 18, 2018; and 50% vest on the date the Company starts commercial production of its first vehicle (“SOP”), which the Company determined was not probable of being met as of December 31, 2020. On December 18, 2020, Legacy Canoo approved an amendment to change the SOP vesting goal of all eligible Founder Restricted Shares held by internal executives to time-based vesting with a merger trigger, which was satisfied on December 21, 2020. The investor-held Founder Restricted Shares’ SOP vesting goal was not amended. The amended time-based vesting of the SOP portion has a cliff vesting of 25% on March 18, 2020 with the remaining shares vesting over 36 months The Company has an irrevocable, exclusive option to repurchase all or any portion of the unvested Founder Restricted Shares at the converted original per share purchase price for the shares upon termination or the cessation of services provided by the stockholder. Restricted Stock Units In August 2020, the Legacy Canoo approved 8,027,473 RSUs to certain employees and consultants of the Company, of which 4,285,026 RSUs were determined to have an established grant date in accordance with ASC 718, Stock Compensation The fair value of our RSUs is based on the fair value of the Legacy Canoo’s ordinary shares on the date of grant. As there is no public market for the Legacy Canoo’s ordinary shares, the Legacy Canoo’s board of directors, with the assistance of a third-party valuation specialist, determined the fair value of the Legacy Canoo’s ordinary shares at the time of the grant of RSUs by considering information available at the time of grant. The valuations were consistent with the guidance and methods outlined in the AICPA Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation On November 25, 2020, the Legacy Canoo withdrew authorization for an aggregate of 2,503,011 RSUs previously approved but not yet granted to certain employees of the Legacy Canoo. Out of the remaining 1,239,435 RSUs previously approved but not yet granted to a certain consultant, Legacy Canoo cancelled 240,441 RSUs and accelerated the vesting of 998,994 RSUs with a merger trigger and an employment condition. The fair value of the 998,994 RSUs was estimated at $18.0 million at the grant date of December 15, 2020. Stock compensation expense of $18.0 million was not recognized until January 2021 when the consultant became an employee of the Company. On November 25, 2020, Legacy Canoo authorized for issuance 1,003,828 RSUs and 1,003,828 performance stock units (“PSUs”) to Mr. Aquila in exchange for his advisory services rendered to the Company and in contemplation of his appointment to the role of Executive Chairman of the Company. Each RSU represents a contingent right to receive one share of the Company’s Common Stock, and are subject to ongoing service-based vesting conditions over a three-year term. Each PSU represents a contingent right to receive one share of the Company’s Common Stock and would vest upon the achievement of certain stock price performance of the Company. The fair value of the 1,003,828 RSUs and 1,003,828 PSUs was estimated at $19.4 million and $15.6 million, respectively. The Company recognized $1.0 million of stock-based compensation expense in December 2020 related to these RSUs and PSU’s. The activity for our restricted stock awards in the year ended December 31, 2020 was as follows (in thousands, except weighted-average grant-date fair value amounts): Weighted- Average Grant-Date Restricted Stock Awards Shares Fair Value Unvested at December 31, 2019 18,335 $ 0.20 Granted 8,657 10.67 Vested (5,468) 9.65 Repurchased (5,413) 0.19 Unvested at December 31, 2020 16,111 $ 9.19 The weighted average fair value per RSA issued during the years ended December 31, 2020 and 2019 was $10.67 and $0.20, respectively. The total fair value of RSAs issued during the years ended December 31, 2020 and 2019, were $92.4 million and $1.8 million, respectively. For the year ended December 31, 2020, the Company recognized stock compensation expense of $83.4 million for restricted stock awards vested, of which $58.7 million was included in research and development expenses and $24.7 million was included in selling, general and administrative expenses in the consolidated statement of operations. For the year ended December 31, 2019, the Company recognized stock compensation expenses of $1.5 million for restricted shares vested, of which $0.6 million was included in research and development expenses and $0.9 million was included in selling, general and administrative expenses in the consolidated statements of operations. Unrecognized compensation cost related to the RSAs as of December 31, 2020 was approximately $116.9 million, of which $92.3 million was expected to be recognized in 2021, $20.5 million was expected to be recognized in 2022, $3.7 million was expected to be recognized in 2023, and the remaining $0.4 million was expected to be recognized in 2024. |
Capital Structure, Warrants
Capital Structure, Warrants | 12 Months Ended |
Dec. 31, 2020 | |
Capital Structure | |
Capital Structure, Warrants | 13. Capital Structure Shares Authorized, Issued and Outstanding As of December 31, 2020, the Company had authorized a total of 510,000,000 shares for issuance with 500,000,000 shares designated as Common Stock and 10,000,000 shares designated as preferred stock. Out of the authorized Common Stock shares, 235,753,000 was issued and outstanding issued outstanding Warrants As of December 31, 2020, the Company had 22,511,238 public warrants and 1,842,106 private warrants outstanding. Each public and private warrant entitles the registered holder to purchase one share of Common Stock at a price of $11.50 per share, subject to adjustment, at any time commencing 30 days after the completion of the Business Combination. The public warrants will expire on the fifth anniversary of the Business Combination, or earlier upon redemption or liquidation. The Company may call the public warrants for redemption: ● in whole and not in part; ● at a price of $0.01 per warrant; ● upon a minimum of 30 days prior written notice of redemption; and ● if, and only if, the last reported closing price of the ordinary shares equals or exceeds $18.00 per share for any 20 trading days within a 30 -trading day period ending on the third trading day prior to the date on which Canoo sends the notice of redemption to the warrant holders. If the Company calls the public warrants for redemption, management will have the option to require all holders that wish to exercise the public warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of Common Stock issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, or recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuance of Common Stock at a price below its exercise price. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2020 | |
Net Loss per Share | |
Net Loss per Share | 14. Net Loss per Share Net loss per share is presented in conformity with the two-class method required for participating securities. Prior to the impact of the retroactive application of the recapitalization, the Legacy Canoo redeemable convertible preference shares were participating securities as the holders of the Legacy Canoo redeemable convertible preference shares are entitled to participate in dividends with ordinary shares. Net losses were not allocated to the Legacy Canoo redeemable convertible preference shares as the holders of the Legacy Canoo redeemable convertible preference shares do not have a contractual obligation to share in any losses. Accordingly, basic net loss per share attributable to ordinary shareholders is calculated by dividing net loss attributable to Legacy Canoo ordinary shareholders by the weighted-average number of Legacy Canoo ordinary shares outstanding for the period. During the years ended December 31, 2020 and December 31, 2019, Legacy Canoo increased the net loss by $42.0 million and $13.9 million respectively, for dividends accumulated for the period on the Legacy Canoo redeemable convertible preference shares to arrive at the numerator used to calculate net loss per share. For all periods presented, the shares included in computing basic net loss per share exclude restricted shares and shares issued upon the early exercise of share options where the vesting conditions have not been satisfied. Diluted net income per share adjusts basic net income per share for the impact of potential Common Stock shares. Potential Common Stock shares include stock options and RSAs. Restricted Common Shares and stock options do not have rights to nonforfeitable dividends. As the Company has reported net losses for all periods presented, all potential Common Stock shares and redeemable convertible preference shares are antidilutive, and accordingly, basic net loss per share equals diluted net loss per share. The following table presents the potential shares that were excluded from the computation of diluted net loss per share, because their effect was anti-dilutive as follows (in thousands): December 31, 2020 2019 Early exercise of unvested stock options 5,280 9,396 Options to purchase Common Stock 324 1,512 Restricted Common Stock shares 7,587 18,335 Restricted stock units 8,524 — |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Taxes | |
Income Taxes | 15. Income Taxes The components of the provision for income taxes consisted of the following (in thousands): Year ended December 31, 2020 2019 Provision for federal income taxes $ — $ — Provision for state income taxes 2 — Provision for income taxes $ 2 $ — The reconciliation of taxes at the statutory rate to our provision for income taxes was as follows (in thousands): Year ended December 31, 2020 2019 Tax at the statutory rate $ (18,861) $ — Foreign rate differential — (18,622) State tax – net of federal benefit 2 (8,493) Officer compensation 1,531 24 Cancellation of debt income 7,676 — Transaction costs 3,605 — Other permanent differences 16 — U.S. tax credits (1,369) (3,497) Change in valuation allowance 7,402 30,588 Provision for income taxes $ 2 $ — In years prior to 2020, the Company was domiciled in the Cayman Islands, which does not impose income taxes. Therefore, the statutory rate in those years is shown to be 0% in the reconciliation above. Deferred tax assets and liabilities consisted of the following (in thousands): December 31, 2020 2019 Net operating loss carry-forwards $ 70,175 $ 30,631 Research and development credits 10,121 7,927 Interest expense 1,901 1,975 Stock-based compensation 5,313 755 Accrued rent (227) — Earnout shares liability 37,359 — Fixed assets 2,189 — Accruals and others 1,372 556 Total gross deferred income tax assets 128,203 41,844 Less: Valuation allowance (128,203) (41,844) Net deferred income tax assets $ — $ — The Company recorded a full valuation allowance against its deferred income tax assets at December 31, 2020 and 2019. Based upon management’s assessment of all available evidence, the Company has concluded that it is more likely than not that the net deferred income tax assets will not be realized. The increase in the valuation allowance for the years ended December 31, 2020 and 2019 was $86.4 million and $30.6 million, respectively. The following table summarizes the activity recorded in the valuation allowance on the deferred income tax assets (in thousands): Valuation allowance at December 31, 2018 $ (11,256) Additions charged to income tax provision (30,588) Valuation allowance at December 31, 2019 (41,844) Additions charged to income tax provision (86,359) Valuation allowance at December 31, 2020 $ (128,203) At December 31, 2020, we had federal net operating loss carryforwards of approximately $228.8 million and state net operating loss carryforwards of $316.8 million that may be carried forward indefinitely for federal income tax purposes and can offset 80% of taxable income in any given year except as amended by the CARES Act. NOL's can be carried forward to offset future taxable income for a period of twenty years for California state income tax purposes. The Company has research and development tax credits at December 31, 2020 and 2019 of approximately $10.1 million and $7.9 million, respectively, for both federal and state income tax purposes. If not utilized, the federal research and development tax credits will expire in various amounts beginning in 2039. State research and development credits can be carried forward indefinitely. Future utilization of the net operating loss carryforwards and tax-credit carryforwards may be subject to an annual limitation based on changes in ownership, as defined by Section 382 of the Internal Revenue Code. The aggregate changes in the balance of gross unrecognized tax benefits during the years ended December 31, 2020 and 2019 were as follows (in thousands): Balance at December 31, 2018 $ (1,870) Increases in balances related to tax provisions taken during current period (6,557) Balance at December 31, 2019 (8,427) Increases in balances related to tax provisions taken during current period (2,737) Balance at December 31, 2020 $ (11,164) As of December 31, 2020, the Company has total uncertain tax positions of $11.2 million primarily related to research and development costs which are recorded as a reduction of the deferred tax asset related carryforwards. The Company's policy is to recognize interest and penalties, if any, related to uncertain tax positions as a component of income tax expense. For the years ended December 31, 2020 and 2019, the Company did not recognize any interest or penalties for uncertain tax positions. The Company is currently not under examination by the United States Internal Revenue Service or any other state, city, or local jurisdiction. The Company is subject to the standard statutes of limitations by the relevant tax authorities for federal and state purposes and all tax years since inception are open for examination. The Company does not anticipate any significant increases or decreases in its unrecognized tax benefits within the next twelve months. In response to the COVID-19 pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) on March 27, 2020. the CARES Act provides numerous tax provisions and other stimulus measures, including refundable payroll tax credits, deferral of employer side social security payments, modifications to the net interest deduction limitations, expansions to the use and carryback of net operating losses, and a technical correction to the depreciation method applicable to qualified improvement property under the 2017 Tax Cuts and Jobs Act. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Retroactive Application of Recapitalization | Retroactive Application of Recapitalization As discussed in Note 4, our Business Combination on December 21, 2020 is accounted for as a recapitalization of equity structure. Pursuant to Generally Accepted Accounting Principles (“GAAP”), we recasted the Company’s consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity from December 31, 2018 to December 21, 2020, the total stockholder’s equity (deficit) within the Company’s consolidated balance sheet as of December 31, 2019 and the weighted average outstanding shares basic and diluted for the year ended December 31, 2019 by applying the recapitalization retroactively. Retroactive Application of Recapitalization to Consolidated Statements of Redeemable Convertible Preference Shares and Stockholders’ (Deficit) Equity As of the Business Combination on December 21, 2020, all 110.3 million shares of Legacy Canoo A series and A-1 series redeemable convertible preference shares of Legacy Canoo (“A/A-1 Shares”) were automatically exchanged into Legacy Canoo ordinary shares at a 1:1 ratio, which were converted again to our Common Stock at a conversion ratio of 1.239434862. The 110.3 million shares consisted of three previous conversions from the Legacy Canoo’s Angel series and Seed series redeemable convertible preference shares and convertible debt. 12/21/20 Redeemable Merger Convertible 08/16/20 A /A-1 Shares Recapitalization Recapitalized Preference Conversion And Conversion Common Date Description Shares Ratio Ordinary Shares Ratio Shares Shareholders' Equity Statement 12/31/2018 Angel Shares 77,000,000 0.54 41,403,247 1.24 51,316,627 3/4/2019 Seed Shares 16,666,667 0.54 8,961,742 1.24 11,107,496 5/6/2019 Seed Shares 16,666,666 0.54 8,961,741 1.24 11,107,495 Shareholders' Equity Statement 12/31/2018 Convertible Debt 51,006,603 1.24 63,219,362 1) Legacy Canoo redeemable convertible preference shares – Angel Series (“Angel Shares”) was outstanding at December 31, 2018 with 77.0 million shares, which were initially converted to 41.4 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 41.4 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 51.3 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 77.0 million shares of Angel Shares outstanding was converted and presented as 51.3 million shares of Common Stock at December 31, 2018. 2) Legacy Canoo redeemable convertible preference shares – Seed Series (“Seed Shares”) was issued on March 4, 2019 and May 6, 2019 with 16.7 million shares and 16.6 million shares, respectively, which were initially converted to 17.9 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 17.9 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 22.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 33.3 million shares of Seed Shares are converted and presented as 22.2 million shares of Common Stock issued during the year ended December 31, 2019. 3) Legacy Canoo convertible debt (“Convertible Debt”) – On August 16, 2020, all Convertible Debt was initially converted to 51.0 million shares of A/A-1 Shares, which were later exchanged into 51.0 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 63.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 51.0 million shares of A/A-1 Shares outstanding is converted and presented as 63.2 million shares of Common Stock issued during the year ended December 31, 2020. Unless otherwise indicated, all other Legacy Canoo ordinary shares as well as previously issued Legacy Canoo share options, restricted ordinary shares and restricted stock units (“RSUs”) presented in the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity and/or in the related notes are presented on an as- or as if-converted basis, converted at the ratio of 1.239434862 and presented as shares or awards of our Common Stock. Retroactive Application of Recapitalization to Consolidated Statements of Operations Based on the retroactive application of recapitalization to our consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity, we recalculated the weighted-average shares for the year ended December 31, 2019. The basic and diluted weighted-average Legacy ordinary shares are retroactively converted to Common Shares to conform to the recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity. The following table summarizes the weighted-average Common Shares, basic and diluted for the year ended December 31, 2019 after factoring all retroactive application of recapitalization. 12/21/20 Weighted As Merger Recapitalized Days Average Previously Conversion Common Outstanding % of Common Date Description Reported Ratio Stock in 2019 weighting Shares 2019 Weighted-average shares, basic and diluted 4,622,051 1.24 5,728,731 100 % 5,728,731 12/31/2018 Angel Shares 51,316,627 366 100 % 51,316,627 3/4/2019 Seed Shares 11,107,496 303 83 % 9,195,550 5/6/2019 Seed Shares 11,107,495 240 66 % 7,283,603 73,524,511 Retroactive Application of Recapitalization to Consolidated Balance Sheets To conform to the retroactive application of recapitalization to our consolidated statements of redeemable convertible preference shares and stockholders’ (deficit) equity, we reclassified the $100.0 million of Angel Shares and the $100.0 million of Seed Shares to the additional paid in capital as of December 31, 2019. |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America (“GAAP”) on a going concern basis, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future. The consolidated financial statements include the results of Canoo Inc. and its subsidiaries. Our comprehensive loss is the same as our net loss. All intercompany transactions and balances have been eliminated in the consolidation. |
COVID-19 | COVID-19 The impact of COVID-19, including changes in consumer and business behavior, pandemic fears and market downturns and restrictions on business and individual activities, has had, and is expected to continue to have, an adverse impact on the economies and financial markets of many countries, including the geographical areas in which Canoo operates. Specifically, the COVID-19 pandemic has caused disruption in the manufacturing, delivery and overall supply chain of vehicle manufacturers and suppliers, which may have an adverse impact on the production schedule of our EVs and our other business prospects and operations. As the COVID-19 pandemic continues to evolve, the extent of the impact to Canoo’s businesses, operating results, cash flows, liquidity and financial condition will be primarily driven by the severity and duration of the pandemic, the pandemic’s impact on the U.S. and global economies and the timing, scope and effectiveness of federal, state and local governmental responses to the pandemic. Those primary drivers are beyond Canoo’s knowledge and control and, as a result, at this time, Canoo is unable to predict the cumulative impact, both in terms of severity and duration, that the COVID-19 pandemic will have on Canoo’s business, operating results, cash flows and financial condition. Although Canoo has made its best estimates based upon current information, actual results could materially differ from the estimates and assumptions developed by management. Accordingly, it is reasonably possible that the estimates made in the consolidated financial statements have been, or will be, materially and adversely impacted in the near term as a result of these conditions, and if so, Canoo may be subject to future impairment losses related to long-lived assets as well as changes in the fair value of its financial instruments. |
Segment and Geographic Information | Segment and Geographic Information Our principal executive officer, as the chief operating decision maker, organizes the Company, manages resource allocations and measures performance on the basis of one operating segment. All of the Company’s property and equipment and right of use assets are located in the United States of America. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates are periodically reviewed in light of changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. On an ongoing basis, management evaluates its estimates, including those related to i) useful lives of property and equipment; ii) the realization of deferred tax assets and estimates of tax reserves; iii) the valuation of equity securities and stock-based compensation; iv) the recognition and disclosure of contingent liabilities; and v) the fair value of financial instruments. These estimates are based on historical data and experience, as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. The Company may engage third party valuation specialists to assist with estimates related to the valuation of the underlying value of its assets, liabilities and equity. Such estimates often require the selection of appropriate valuation methodologies and models, and significant judgment in evaluating ranges of assumptions and financial inputs. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of investments that are highly liquid, readily convertible to cash and which have an original maturity date within three months from the date of purchase as well as savings, checking and other bank accounts. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist principally of cash and cash equivalents. The Company, at times, maintains cash and cash equivalent balances at financial institutions in excess of amounts insured by United States government agencies or payable by the United States government directly. The Company places its cash with high credit quality financial institutions . |
Restricted Cash | Restricted Cash We did not have any restricted cash at December 31, 2020. The 2019 restricted cash was required by our bank as a security deposit for our employee credit card program. |
Property and Equipment | Property and Equipment Property and equipment is stated at historical cost less accumulated depreciation. Depreciation is provided on property and equipment over the estimated useful lives on a straight-line basis. Expenditures for repairs and maintenance are expensed as incurred. Useful lives by asset category are as follows: Assets category Years Leasehold improvements Shorter of lease term or estimated useful life Machinery and equipment 3 years Furniture and fixtures 5 years Computer hardware and software 3 years Vehicles 3 years |
Leases | Leases On January 1, 2018, the Company early adopted Accounting Standards Codification (“ASC”) No. 842, Leases The operating lease ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The operating lease ROU assets and operating lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company estimates an incremental borrowing rate based on the estimated market rate of interest for a collateralized borrowing over a similar term of the lease payments at commencement date. The operating lease right-of-use asset also includes any lease payments made prior to the lease commencement date. Lease expense for operating leases is recognized on a straight-line basis over the lease term. The determination of the lease term includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company has elected to exclude short-term leases (i.e., leases with expected terms of 12 months or less) from the recognition requirements of ASC 842, and has elected to account for lease and certain non-lease components as a single component. At December 31, 2020, the Company had only one operating lease for its corporate headquarters in Torrance, California. See Note 10 “Related Party Lease” for additional information. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company assesses the carrying value of its long-lived assets, consisting primarily of property and equipment and lease ROU assets, when there is evidence that events or changes in circumstances indicate that the carrying value of an asset or group of assets may not be recoverable. Such events or changes in circumstances may include a significant decrease in the market price of a long-lived asset, a significant change in the extent or manner in which an asset is used, a significant change in legal factors or in the business climate, a significant deterioration in the amount of revenue or cash flows expected to be generated from a group of assets, a current expectation that, more likely than not a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life, or any other significant adverse change that would indicate that the carrying value of an asset or group of assets may not be recoverable. The Company performs impairment testing at the asset group level that represents the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. If events or changes in circumstances indicate that the carrying amount of an asset group may not be recoverable and the expected undiscounted future cash flows attributable to the asset group are less than the carrying amount of the asset group, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. To date, the Company has not recorded any impairment losses on long-lived assets. |
Income Taxes | Income Taxes The company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement carrying amounts and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company recognizes the tax benefit from uncertain tax positions only if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income tax matters in income tax expense. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies the provisions of ASC 820, Fair Value Measurements and Disclosures ● Level 1 Quoted prices in active markets for identical assets or liabilities. ● Level 2 Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active for identical or similar assets and liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 Valuations are based on inputs that are unobservable and significant to the overall fair value measurement of the assets or liabilities. Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. As allowed by ASC 820, we have elected fair value accounting for our convertible notes. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The following table summarizes the Company’s liabilities that are measured at fair value on a recurring basis as required by ASC 820, by level, within the fair value hierarchy as of December 31, 2020 and 2019 (in thousands): December 31, 2020 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 702,422 $ 702,422 $ — $ — Liability Contingent earnout shares liability $ 133,503 $ — $ — $ 133,503 December 31, 2019 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 28,182 $ 28,182 $ — $ — Liability Related party derivative liability $ 17,797 $ — $ — $ 17,797 As described in Note 11, the Company has a contingent obligation to issue 15.0 million shares of our Common Stock to certain stockholders and employees (i.e., the Earnout Shares, defined below). Upon the occurrence of a bankruptcy or liquidation, any unissued Earnout Shares would be fully issued regardless of whether the share price target has been met. The Earnout Shares are accounted for as a contingent liability and its fair value is determined using Level 3 inputs, since estimating the fair value of this contingent liability requires the use of significant and subjective inputs that may and are likely to change over the duration of the liability with related changes in internal and external market factors. The tranches were valued using the Monte Carlo simulation of the stock prices based on historical and implied market volatility of a peer group of public companies. Following is a summary of the change in fair value of contingent Earnout Shares (defined below) liability for the year ended December 31, 2020 (in thousands). Beginning fair value $ — Addition during the year 248,878 Change in fair value during the year (115,375) Ending fair value $ 133,503 Following is a summary of the change in fair value of related party derivative liability for the year ended December 31, 2020 and 2019 (in thousands). Year Ended December 31, 2020 2019 Beginning fair value $ 17,797 $ — Addition during the year — 17,797 Change in fair value during the year (17,797) — Ending fair value $ — $ 17,797 The Company’s contingent Earnout Shares liability and embedded derivative liability on its convertible notes are considered a “Level 3” fair value measurement. Refer to Note 11 and Note 7, respectively, for discussion of the Company’s methods for valuation. |
Contingent Earnout Shares Liability | Contingent Earnout Shares Liability The Business Combination provide certain stockholders and employees with the contingent right to up to an additional 15.0 million shares of our Common Stock (the “Earnout Shares”). Issuances are made in three tranches of 5.0 million shares each upon reaching share price targets within specified time frames. The first tranche will be issued if the share price reaches $18 within two years of the closing of the Business Combination. The second tranche will be issued if the share price reaches $25 within four years of the closing of the Business Combination. The third tranche will be issued if the share price reaches $30 within five years of the closing of the Business Combination. The tranches may also be issued upon a change of control transaction that occurs within the respective timeframes and results in per share consideration exceeding the respective share price target. Additionally, the full 15.0 million Earnout Shares will be issued in the event of a liquidation or bankruptcy. The Company determined that the right to Earnout Shares represents a contingent liability that meets the definition of a derivative and recognized it on the balance sheet at its fair value upon the Business Combination date. The right to Earnout Shares is remeasured at fair value each period through earnings. See Note 11 for further discussion. Our financial instruments not subject to ASC 820 include cash and cash equivalents, restricted cash, accounts payable and other current liabilities. The carrying amounts of these instruments approximated fair value because of their short-term maturities on December 31, 2020. |
Revenue Recognition | Revenue Recognition The Company applies ASC 606, which governs how the Company recognizes revenue. Under ASC 606, the Company recognizes revenue when the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company recognizes revenue pursuant to the five-step framework contained in ASC 606: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies the performance obligations. During 2020, the Company's revenue was derived from the provision of consulting services on a project basis. The Company's fixed price contracts related to these services contain a single performance obligation, which was satisfied in July 2020 when the Company provided the final report to the customer. Revenue for these services was recognized at a point in time, when the project was delivered. Sales taxes are not included in our gross revenue. There were no contract liabilities as of December 31, 2020 and 2019. Cost of Revenue, excluding Depreciation Cost of revenue, excluding depreciation, includes materials, labor, and other direct costs related to the provision of engineering, development, and design consulting services. |
Research and Development Expenses, excluding Depreciation | Research and Development Expenses , excluding Depreciation Research and development expenses, excluding depreciation consists of salaries, employee benefits and expenses for design and engineering personnel, stock-based compensation, as well as materials and supplies used in research and development activities. In addition, research and development expenses include fees for consulting and engineering services from third party vendors. The Company allocates a portion of overhead costs which includes lease expense, utilities and worker’s compensation premiums to the research and development department expense based on headcount. |
Selling, General and Administrative Expenses, excluding Depreciation | Selling, General and Administrative Expenses, excluding Depreciation The principal components of our selling, general and administrative expenses are salaries, wages, benefits and bonuses paid to our employees; stock-based compensation; travel and other business expenses; professional services fees (including legal, audit and tax); and ordinary day-to-day business expenses. |
Depreciation Expense | Depreciation Expense Depreciation is provided on property and equipment over the estimated useful lives on a straight-line basis. Upon retirement or disposal, the cost of the asset disposed of and the related accumulated depreciation are removed from the accounts and any gain or loss is reflected in the loss from operations. No depreciation expense is allocated to research and development, cost of revenue and general and administrative expense. |
Loss Contingencies | Loss Contingencies Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs for loss contingencies are expensed as incurred. |
Stock-based compensation | Stock-based compensation The Company accounts for stock-based compensation awards granted to employees and directors based on the awards’ estimated grant date fair value. The Company estimates the fair value of its share options using the Black-Scholes option-pricing model. For awards that vest solely based on continued service (“service-only vesting conditions”), the resulting fair value is recognized on a straight-line basis over the period during which an employee is required to provide service in exchange for the award, usually the vesting period, which is generally four years For purposes of calculating stock-based compensation, we estimate the fair value of our stock options using the Black-Scholes option-pricing model, which requires the use of certain subjective assumptions including liquidity dates, volatility, discount rates, the risk-free rate and the fair value of our Common Stock. These assumptions generally require significant judgment and involve inherent uncertainties, which can materially affect the estimate of the fair value of our stock options and ultimately how much stock-based compensation expense is recognized. Prior to our Business Combination on December 21, 2020, the fair value of our RSUs is based on the fair value of the Legacy Canoo’s ordinary shares on the date of grant. As there is no public market for the Legacy Canoo’s ordinary shares, Legacy Canoo, with the assistance of a third-party valuation specialist, determined the fair value of the Legacy Canoo’s ordinary shares at the time of the grant of RSUs by considering a number of objective and subjective factors, including the likelihood of achieving a liquidity event and transactions involving the Legacy Canoo’s ordinary shares, among other factors. The fair value of the Legacy Canoo’s ordinary shares was derived from the Legacy Canoo’s total equity value divided by the number of shares outstanding and was estimated using a probability-weighted expected return model, using different probability weightings estimated for public offering scenario, M&A scenario and dissolution scenario. The factors and scenario weighting estimates require significant judgment involve inherent uncertainties, which can materially affect the estimate of the fair value of our RSUs and ultimately how much Stock-based compensation expense is recognized. After December 21, 2020, we estimate the fair value of RSUs based on the market price of our Common Stock underlying the awards on the grant date. Fair value for awards with our stock price performance metrics is calculated using the Monte Carlo simulation model, which incorporates stock price correlation and other variables over the time horizons matching the performance periods. For the years ended December 31, 2020 and December 31, 2019 total stock-based compensation expense was $84.3 million and $1.9 million, respectively. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Schedule of retroactive recapitalization | 12/21/20 Redeemable Merger Convertible 08/16/20 A /A-1 Shares Recapitalization Recapitalized Preference Conversion And Conversion Common Date Description Shares Ratio Ordinary Shares Ratio Shares Shareholders' Equity Statement 12/31/2018 Angel Shares 77,000,000 0.54 41,403,247 1.24 51,316,627 3/4/2019 Seed Shares 16,666,667 0.54 8,961,742 1.24 11,107,496 5/6/2019 Seed Shares 16,666,666 0.54 8,961,741 1.24 11,107,495 Shareholders' Equity Statement 12/31/2018 Convertible Debt 51,006,603 1.24 63,219,362 1) Legacy Canoo redeemable convertible preference shares – Angel Series (“Angel Shares”) was outstanding at December 31, 2018 with 77.0 million shares, which were initially converted to 41.4 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 41.4 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 51.3 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 77.0 million shares of Angel Shares outstanding was converted and presented as 51.3 million shares of Common Stock at December 31, 2018. 2) Legacy Canoo redeemable convertible preference shares – Seed Series (“Seed Shares”) was issued on March 4, 2019 and May 6, 2019 with 16.7 million shares and 16.6 million shares, respectively, which were initially converted to 17.9 million shares of Legacy A series redeemable convertible preference shares on August 16, 2020 and later were exchanged into 17.9 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 22.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 33.3 million shares of Seed Shares are converted and presented as 22.2 million shares of Common Stock issued during the year ended December 31, 2019. 3) Legacy Canoo convertible debt (“Convertible Debt”) – On August 16, 2020, all Convertible Debt was initially converted to 51.0 million shares of A/A-1 Shares, which were later exchanged into 51.0 million shares of Legacy Canoo ordinary shares on December 21, 2020 and converted again to 63.2 million shares of our Common Stock at the Business Combination on December 21, 2020. In the accompanying recasted consolidated statements of redeemable convertible preference shares and stockholders' (deficit) equity, the 51.0 million shares of A/A-1 Shares outstanding is converted and presented as 63.2 million shares of Common Stock issued during the year ended December 31, 2020. 12/21/20 Weighted As Merger Recapitalized Days Average Previously Conversion Common Outstanding % of Common Date Description Reported Ratio Stock in 2019 weighting Shares 2019 Weighted-average shares, basic and diluted 4,622,051 1.24 5,728,731 100 % 5,728,731 12/31/2018 Angel Shares 51,316,627 366 100 % 51,316,627 3/4/2019 Seed Shares 11,107,496 303 83 % 9,195,550 5/6/2019 Seed Shares 11,107,495 240 66 % 7,283,603 73,524,511 |
Schedule of useful lives by asset | Assets category Years Leasehold improvements Shorter of lease term or estimated useful life Machinery and equipment 3 years Furniture and fixtures 5 years Computer hardware and software 3 years Vehicles 3 years |
Schedule of assets and liabilities measured at fair value on a recurring basis | December 31, 2020 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 702,422 $ 702,422 $ — $ — Liability Contingent earnout shares liability $ 133,503 $ — $ — $ 133,503 December 31, 2019 Fair Value Level 1 Level 2 Level 3 Assets Money Market Funds $ 28,182 $ 28,182 $ — $ — Liability Related party derivative liability $ 17,797 $ — $ — $ 17,797 |
Summary of the change in fair value of contingent earnout shares liability | Beginning fair value $ — Addition during the year 248,878 Change in fair value during the year (115,375) Ending fair value $ 133,503 |
Summary of the change in fair value of related party derivative liability | Year Ended December 31, 2020 2019 Beginning fair value $ 17,797 $ — Addition during the year — 17,797 Change in fair value during the year (17,797) — Ending fair value $ — $ 17,797 |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combination | |
Reconciliation of business combination to Statement of Cash Flows and Statement of Changes in Equity | Recapitalization Cash - HCAC's trust and cash (net of redemptions) $ 306,354 Cash - PIPE 323,250 Less transaction costs and advisory fees paid (22,508) Net Business Combination and PIPE financing 607,096 Add: non-cash net assets assumed from HCAC 40 Net contributions from Business Combination and PIPE financing $ 607,136 |
Schedule of shares issued following consummation of the Business Combination | Number of Shares Common stock, outstanding prior to Business Combination 29,730,204 Less redemption of HCAC shares (9,571) Common stock of HCAC 29,720,633 HCAC Founder Shares 7,503,750 Shares issued in PIPE 32,325,000 Business Combination and PIPE financing shares 69,549,383 Legacy Canoo shares (1) 166,155,697 Total shares of Common Stock immediately after Business Combination 235,705,080 (1) The number of Legacy Canoo shares was determined from the 134.1 million shares of Legacy Canoo ordinary shares outstanding immediately prior to the closing of the Business Combination converted at the Exchange Ratio of 1.239434862 . All fractional shares were rounded down. |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property and Equipment, net | |
Schedule of Property and Equipment, net | December 31, 2020 2019 Machinery and equipment $ 15,292 $ 8,946 Computer hardware 2,464 2,396 Computer software 5,159 3,675 Vehicles 63 95 Furniture and fixtures 519 512 Leasehold improvements 14,559 16,197 Construction-in-progress 5,283 — 43,339 31,821 Less: Accumulated depreciation (12,913) (5,811) Property and equipment, net $ 30,426 $ 26,010 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accrued Expenses | |
Schedule of Accrued Expenses and Other Current Liabilities | December 31, 2020 2019 Accrued interest expense $ 34 $ 4,708 Accrued property and equipment purchases 3,992 — Accrued research and development costs 2,420 2,195 Accrued professional fees 1,386 160 Accrued Business Combination costs 815 — Short term lease liability 444 368 Other accrued expenses 1,534 703 Total accrued expenses $ 10,625 $ 8,134 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Lease | |
Schedule of Maturities of the Company's operating lease liabilities | Operating Lease 2021 $ 1,507 2022 1,553 2023 1,599 2024 1,647 2025 1,697 Thereafter 14,092 Total lease payments 22,095 Less: imputed interest (1) 8,389 Present value of operating lease liabilities 13,706 Current portion of operating lease liabilities 444 Operating lease liabilities, net of current portion $ 13,262 (1) Calculated using the incremental borrowing rate On November 25, 2020, Legacy Canoo entered into an agreement with Tony Aquila, Executive Chairman to reimburse Mr. Aquila for certain air travel expenses based on certain agreed upon criteria (“aircraft reimbursement”). The total aircraft reimbursement to Mr. Aquila for the use of an aircraft owned by Aquila Family Ventures, LLC (“AFV”), an entity controlled by Mr. Aquila, for the purposes related to the business of the Company for year ended December 31, 2020 was $541,000. |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-Based Compensation | |
Schedule of weighted average valuation assumptions, options | December 31, 2020 2019 Risk free interest rates 1.62 % 1.69 % Expected lives (in years) 6.0 6.0 Dividend yield — — Expected volatility 60.0 % 60.0 % |
Summary of activity for the Company's share options | Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Shares Price Life (years) Value Outstanding at December 31, 2019 1,512 $ 0.02 9.64 $ 637 Granted 209 $ 0.02 Forfeited (973) $ 0.01 Exercised (424) $ 0.02 Outstanding at December 31, 2020 324 $ 0.02 8.47 $ 137 |
Summary of activity for the Company's restricted shares | Weighted- Average Grant-Date Restricted Stock Awards Shares Fair Value Unvested at December 31, 2019 18,335 $ 0.20 Granted 8,657 10.67 Vested (5,468) 9.65 Repurchased (5,413) 0.19 Unvested at December 31, 2020 16,111 $ 9.19 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Net Loss per Share | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | December 31, 2020 2019 Early exercise of unvested stock options 5,280 9,396 Options to purchase Common Stock 324 1,512 Restricted Common Stock shares 7,587 18,335 Restricted stock units 8,524 — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Taxes | |
Schedule of the components of the provision for income taxes | Year ended December 31, 2020 2019 Provision for federal income taxes $ — $ — Provision for state income taxes 2 — Provision for income taxes $ 2 $ — |
Schedule of tax rate reconciliation | Year ended December 31, 2020 2019 Tax at the statutory rate $ (18,861) $ — Foreign rate differential — (18,622) State tax – net of federal benefit 2 (8,493) Officer compensation 1,531 24 Cancellation of debt income 7,676 — Transaction costs 3,605 — Other permanent differences 16 — U.S. tax credits (1,369) (3,497) Change in valuation allowance 7,402 30,588 Provision for income taxes $ 2 $ — |
Schedule of deferred income tax assets | December 31, 2020 2019 Net operating loss carry-forwards $ 70,175 $ 30,631 Research and development credits 10,121 7,927 Interest expense 1,901 1,975 Stock-based compensation 5,313 755 Accrued rent (227) — Earnout shares liability 37,359 — Fixed assets 2,189 — Accruals and others 1,372 556 Total gross deferred income tax assets 128,203 41,844 Less: Valuation allowance (128,203) (41,844) Net deferred income tax assets $ — $ — |
Schedule of valuation allowance on the deferred income tax assets | Valuation allowance at December 31, 2018 $ (11,256) Additions charged to income tax provision (30,588) Valuation allowance at December 31, 2019 (41,844) Additions charged to income tax provision (86,359) Valuation allowance at December 31, 2020 $ (128,203) |
Schedule of unrecognized tax benefits | Balance at December 31, 2018 $ (1,870) Increases in balances related to tax provisions taken during current period (6,557) Balance at December 31, 2019 (8,427) Increases in balances related to tax provisions taken during current period (2,737) Balance at December 31, 2020 $ (11,164) |
Organization and Business (Deta
Organization and Business (Details) - USD ($) shares in Millions | Dec. 21, 2020 | Dec. 31, 2020 |
Business Acquisition, Contingent Consideration [Line Items] | ||
Goodwill | $ 0 | |
Intangible assets | $ 0 | |
Earn Out Shares [Member] | ||
Business Acquisition, Contingent Consideration [Line Items] | ||
Number of shares issued or issuable | 15 | 15 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Recapitalization (Details) $ in Thousands | Dec. 21, 2020itemshares | Aug. 16, 2020shares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($)shares |
Reclassification [Line Items] | |||||
Number Of Previous Conversions | item | 3 | ||||
Adjustment To Additional Paid In Capital Contingent Earnout Shares Liability | $ | $ (248,878) | ||||
Conversion of Stock, Shares Converted | 110,300,000 | 17,900,000 | |||
Stock conversion, shares received per share converted | 1.239434862 | ||||
Retroactive Application of Merger Recapitalization, Share | 5,728,731 | ||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 110,378,000 | 73,524,511 | |||
Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 41,400,000 | 41,400,000 | |||
Stock conversion, shares received per share converted | 1.24 | 0.54 | |||
Shares, Outstanding | 51,316,627 | ||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 51,316,627 | ||||
Number Of Days Shares Were Outstanding During Period | 366 days | ||||
Weighting Percentage | 100.00% | ||||
Conversion Of Stock, Seed Shares Issued March 4 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Stock conversion, shares received per share converted | 1.24 | 0.54 | |||
Conversion of Stock, Shares Issued | 11,107,496 | ||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 9,195,550 | ||||
Number Of Days Shares Were Outstanding During Period | 303 days | ||||
Weighting Percentage | 83.00% | ||||
Conversion Of Stock, Seed Shares Issued May 6 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Stock conversion, shares received per share converted | 1.24 | 0.54 | |||
Conversion of Stock, Shares Issued | 11,107,495 | ||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 7,283,603 | ||||
Number Of Days Shares Were Outstanding During Period | 240 days | ||||
Weighting Percentage | 66.00% | ||||
Conversion Of Stock, Convertible Debt [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 51,000,000 | 51,000,000 | 51,000,000 | ||
Stock conversion, shares received per share converted | 1.24 | ||||
Common Stock | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 136,800,000 | ||||
Shares, Outstanding | 235,753,000 | 108,838,000 | 75,669,000 | ||
Common Stock | Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 51,316,627 | ||||
Common Stock | Conversion Of Stock, Seed Shares Issued March 4 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 11,107,496 | ||||
Common Stock | Conversion Of Stock, Seed Shares Issued May 6 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 11,107,495 | ||||
Common Stock | Conversion Of Stock, Convertible Debt [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of debt, shares issued | 63,219,362 | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | |||||
Reclassification [Line Items] | |||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 5,728,731 | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Conversion Of Stock, Convertible Debt [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 51,006,603 | ||||
Conversion of debt, shares issued | 63,200,000 | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Common Stock | |||||
Reclassification [Line Items] | |||||
Retroactive Application of Merger Recapitalization, Share | 22,215,000 | ||||
Shares, Outstanding | 51,317,000 | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Common Stock | Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Shares, Outstanding | 51,300,000 | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Redeemable convertible preference shares - Angel Series | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Carrying Amount, Attributable to Parent | $ | $ (100,000) | ||||
Temporary Equity, Shares Outstanding | (77,000,000) | ||||
Revision of Prior Period, Reclassification, Adjustment [Member] | Redeemable convertible preference shares - Seed Series | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Value, New Issues | $ | $ (100,000) | ||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | (33,333,000) | ||||
Previously Reported | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 33,300,000 | ||||
Weighted Average Number of Shares Outstanding, Basic and Diluted | 4,622,051 | ||||
Previously Reported | Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Shares Outstanding | 77,000,000 | ||||
Previously Reported | Conversion Of Stock, Seed Shares Issued March 4 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 16,700,000 | ||||
Previously Reported | Conversion Of Stock, Seed Shares Issued May 6 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 16,666,666 | ||||
Previously Reported | Common Stock | |||||
Reclassification [Line Items] | |||||
Shares, Outstanding | 24,352,000 | ||||
Previously Reported | Redeemable convertible preference shares - Angel Series | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Carrying Amount, Attributable to Parent | $ | $ 100,000 | ||||
Temporary Equity, Shares Outstanding | 77,000,000 | ||||
Previously Reported | Redeemable convertible preference shares - Seed Series | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Value, New Issues | $ | $ 100,000 | ||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 33,333,000 | ||||
A Series Redeemable Convertible Preference Shares | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 59,300,000 | ||||
Redeemable Convertible Preference Shares | Previously Reported | Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Shares Outstanding | 77,000,000 | ||||
Redeemable Convertible Preference Shares | Previously Reported | Conversion Of Stock, Seed Shares Issued March 4 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 16,666,667 | ||||
Redeemable Convertible Preference Shares | Previously Reported | Conversion Of Stock, Seed Shares Issued May 6 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Temporary Equity, Stock Issued During Period, Shares, New Issues | 16,666,666 | ||||
Redeemable convertible preference shares - Angel Series | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 77,000,000 | ||||
Redeemable convertible preference shares - Angel Series | Revision of Prior Period, Reclassification, Adjustment [Member] | Conversion Of Stock, Angel Shares [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 41,403,247 | ||||
Redeemable convertible preference shares - Seed Series | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Issued | 33,300,000 | ||||
Seed Series Redeemable Convertible Preference Shares Tranche 1 [Member] | Revision of Prior Period, Reclassification, Adjustment [Member] | Conversion Of Stock, Seed Shares Issued March 4 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 8,961,742 | ||||
Seed Series Redeemable Convertible Preference Shares Tranche 2 [Member] | Revision of Prior Period, Reclassification, Adjustment [Member] | Conversion Of Stock, Seed Shares Issued May 6 2019 [Member] | |||||
Reclassification [Line Items] | |||||
Conversion of Stock, Shares Converted | 8,961,741 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Segments, Property and Equipment (Details) | 12 Months Ended | |
Dec. 31, 2020USD ($)segmentitem | Dec. 31, 2019USD ($) | |
Property, Plant and Equipment [Line Items] | ||
Number of operating segments | segment | 1 | |
Lease, Practical Expedient, Lessor Single Lease Component [true false] | true | |
Number Of Operating Leases | item | 1 | |
Impairment of long-lived assets | $ | $ 0 | $ 0 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 5 years | |
Computer hardware | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value, Contingent Liability (Details) $ in Thousands, shares in Millions | Dec. 21, 2020USD ($)itemshares | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Recognition of contingent earnout share liability | $ 248,900 | $ (248,878) | |
Gain on fair value change in contingent earnout share liability | $ (115,375) | ||
Number of tranches for issuance | item | 3 | ||
Earn Out Shares [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Number of shares issued or issuable | shares | 15 | 15 | |
Liabilities, ending fair value | $ 133,500 | ||
Earn Out Shares [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Recognition of contingent earnout share liability | 248,878 | ||
Gain on fair value change in contingent earnout share liability | (115,375) | ||
Liabilities, ending fair value | 133,503 | ||
Related party derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities, beginning fair value | 17,797 | ||
Addition during the year | $ 17,797 | ||
Change in fair value during the year | (17,797) | ||
Liabilities, ending fair value | 17,797 | ||
Recurring | Earn Out Shares [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities, ending fair value | 133,503 | ||
Recurring | Related party derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities, beginning fair value | 17,797 | ||
Liabilities, ending fair value | 17,797 | ||
Recurring | Money market funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 702,422 | 28,182 | |
Recurring | Level 1 | Money market funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Assets | 702,422 | 28,182 | |
Recurring | Level 3 | Earn Out Shares [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities, ending fair value | 133,503 | ||
Recurring | Level 3 | Related party derivative liability | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Liabilities, beginning fair value | $ 17,797 | ||
Liabilities, ending fair value | $ 17,797 |
Basis of Presentation and Sum_7
Basis of Presentation and Summary of Significant Accounting Policies - Revenue, etc. (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Basis of Presentation and Summary of Significant Accounting Policies | ||
Contract liabilities | $ 0 | $ 0 |
Vesting period | 4 years | |
Stock-based compensation | $ 84,280 | $ 1,873 |
Business Combination (Details)
Business Combination (Details) - USD ($) | Dec. 21, 2020 | Aug. 17, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Exchange ratio | 1.239434862 | |||
Shares authorized | 510,000,000 | |||
Common stock, shares authorized | 500,000,000 | 482,967,000 | ||
Common stock, par value | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares authorized | 10,000,000 | 0 | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | ||
Stock Issued During Period, Value, New Issues | $ 607,136,000 | |||
Goodwill | $ 0 | |||
Intangible assets | $ 0 | |||
HCAC | ||||
Business Acquisition [Line Items] | ||||
Exchange ratio | 1.239434862 | |||
Shares authorized | 510,000,000 | |||
Common stock, shares authorized | 500,000,000 | |||
Common stock, par value | $ 0.0001 | |||
Preferred stock, shares authorized | 10,000,000 | |||
Preferred stock, par value | $ 0.0001 | |||
Number of shares issued or issuable | 166,155,697 | |||
Goodwill | $ 0 | |||
Intangible assets | $ 0 | |||
Hennessy Capital Acquisition Corp. IV H C A C [Member] | ||||
Business Acquisition [Line Items] | ||||
Stock Issued During Period, Shares, New Issues | 32,325,000 | |||
Share Price | $ 10 | |||
Stock Issued During Period, Value, New Issues | $ 323,300,000 |
Business Combination - Cash flo
Business Combination - Cash flow (Details) - HCAC $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Business Combination | |
Cash - HCAC's trust and cash (net of redemptions) | $ 306,354 |
Cash - PIPE | 323,250 |
Less transaction costs and advisory fees paid | (22,508) |
Net Business Combination and PIPE financing | 607,096 |
Add: non-cash net assets assumed | 40 |
Net contributions from Business Combination and PIPE financing | $ 607,136 |
Business Combination - Shares i
Business Combination - Shares issued (Details) - shares | Dec. 21, 2020 | Dec. 31, 2020 | Dec. 20, 2020 |
Business Combination | |||
Exchange ratio | 1.239434862 | ||
Earn Out Shares [Member] | |||
Business Combination | |||
Number of shares issued or issuable | 15,000,000 | 15,000,000 | |
HCAC | |||
Business Combination | |||
Common stock, outstanding prior to Business Combination | 235,705,080 | 29,730,204 | |
Less redemption of HCAC shares | (9,571) | ||
Common stock of HCAC | 29,720,633 | ||
HCAC Founder Shares | 7,503,750 | ||
Number of shares issued in private placement investment (PIPE). | 32,325,000 | ||
Business Combination and PIPE financing shares | 69,549,383 | ||
Number of shares issued or issuable | 166,155,697 | ||
Total shares of Common Stock immediately after Business Combination | 235,705,080 | 29,730,204 | |
Number of shares converted | 134,100,000 | ||
Exchange ratio | 1.239434862 | ||
HCAC | Earn Out Shares [Member] | |||
Business Combination | |||
Number of shares issued or issuable | 15,000,000 |
Property and Equipment, net (De
Property and Equipment, net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | $ 43,339 | $ 31,821 |
Less: Accumulated depreciation | (12,913) | (5,811) |
Property and Equipment, net | 30,426 | 26,010 |
Depreciation | 7,125 | 4,729 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 15,292 | 8,946 |
Computer hardware | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 2,464 | 2,396 |
Computer software | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 5,159 | 3,675 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 63 | 95 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 519 | 512 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | 14,559 | $ 16,197 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, Gross | $ 5,283 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Accrued Expenses | ||
Accrued interest expense | $ 34 | $ 4,708 |
Accrued property and equipment purchases | 3,992 | |
Accrued research and development costs | 2,420 | 2,195 |
Accrued professional fees | 1,386 | 160 |
Accrued business combination costs | 815 | |
Short term lease liability | 444 | 368 |
Other accrued expenses | 1,534 | 703 |
Total accrued expenses | $ 10,625 | $ 8,134 |
Long-term Debt, etc. - Converti
Long-term Debt, etc. - Convertible Debt (Details) - USD ($) $ in Thousands | Jun. 07, 2020 | Mar. 23, 2020 | Sep. 30, 2020 | Mar. 31, 2020 | Aug. 31, 2019 | Dec. 31, 2020 | Aug. 31, 2020 | Aug. 16, 2020 | Apr. 30, 2020 |
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Gain on extinguishment of debt | $ 5,045 | ||||||||
Carrying value of debt | $ 286,100 | ||||||||
Unpaid accrued interest through | $ 5,200 | ||||||||
Gain or loss recognized attributable to instrument-specific credit risk | 0 | ||||||||
PPP Loan | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Loan proceeds | $ 7,000 | ||||||||
Fair value of Notes | $ 7,000 | ||||||||
$100M Notes | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 100,000 | ||||||||
Interest rate | 12.00% | ||||||||
Threshold sales price of equity securities | $ 200,000 | ||||||||
Percentage of cash price per share paid | 80.00% | 80.00% | 80.00% | ||||||
Debt instrument conversion price | $ 500,000 | $ 500,000 | |||||||
Unpaid and accrued interest, forgiveness | 7,400 | ||||||||
Gain on extinguishment of debt | 8,300 | ||||||||
Carrying value of debt | 88,700 | ||||||||
Unpaid accrued interest through | 7,400 | ||||||||
Fair value of the embedded derivative liability | 17,700 | ||||||||
Fair value of Notes | $ 105,600 | 105,600 | |||||||
Accretion of the debt discount in interest expense | $ 2,600 | ||||||||
$10.3M Notes | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 10,300 | ||||||||
Interest rate | 8.00% | ||||||||
Threshold sales price of equity securities | 200,000 | ||||||||
Percentage of cash price per share paid | 80.00% | ||||||||
Debt instrument conversion price | $ 500,000 | ||||||||
$15M Notes | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 15,000 | ||||||||
Percentage of cash price per share paid | 80.00% | ||||||||
Debt instrument conversion price | $ 500,000 | ||||||||
$15M Notes | New Noteholders | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | 5,000 | ||||||||
$15M Notes | Affiliates | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 10,000 | ||||||||
$155.3M Notes | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 155,300 | ||||||||
Interest rate | 8.00% | ||||||||
$155.3M Notes | New Noteholders | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 75,300 | ||||||||
$155.3M Notes | Affiliates | |||||||||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||||||||
Aggregate principal amount | $ 80,000 |
Long-term Debt, etc. - Exchange
Long-term Debt, etc. - Exchange of Debt (Details) - USD ($) $ in Thousands, shares in Millions | Dec. 21, 2020 | Aug. 16, 2020 | Aug. 31, 2020 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Aggregate principal amount | $ 280,500 | |||
Value of shares issued on conversion | $ 291,309 | |||
Fair value of convertible debt | 286,100 | |||
Change in fair value | $ 100 | |||
Total gain on extinguishment | 41,600 | |||
Effective capital contribution | 36,500 | |||
Gain on extinguishment of debt | $ 5,045 | |||
Adjusted carrying value of the Notes | 286,100 | |||
Unpaid accrued interest through | 5,200 | |||
Redeemable Convertible Preference Shares | ||||
Debt Instrument [Line Items] | ||||
Equity, Fair Value Disclosure | $ 249,800 | |||
A Series Redeemable Convertible Preference Shares | ||||
Debt Instrument [Line Items] | ||||
Shares issued in debt conversion | 31.6 | |||
Gain on extinguishment of debt | $ (90,500) | |||
Equity, Fair Value Disclosure | $ 290,500 | |||
A-1 Series Redeemable Convertible Preference Shares | ||||
Debt Instrument [Line Items] | ||||
Shares issued in debt conversion | 19.4 |
Long-term Debt, etc. - Exchan_2
Long-term Debt, etc. - Exchange of Preference Shares (Details) - USD ($) $ in Thousands, shares in Millions | Dec. 21, 2020 | Aug. 16, 2020 | Dec. 31, 2020 |
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||
Convertible debt, original amount | $ 280,500 | ||
Value of shares issued on conversion | $ 291,309 | ||
Gain on extinguishment of debt | $ 5,045 | ||
Carrying value of debt | $ 286,100 | ||
Redeemable convertible preference shares - Angel Series | |||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||
Conversion of Stock, Shares Issued | 77 | ||
Redeemable convertible preference shares - Seed Series | |||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||
Conversion of Stock, Shares Issued | 33.3 | ||
Equity, Fair Value Disclosure | $ 200,000 | ||
A Series Redeemable Convertible Preference Shares | |||
Long-term Debt, Convertible Debt and Redeemable Convertible Preference Shares | |||
Conversion of Stock, Shares Issued | 59.3 | ||
Gain on extinguishment of debt | $ (90,500) | ||
Equity, Fair Value Disclosure | $ 290,500 | ||
Deemed dividend | $ 90,500 | $ 90,500 |
Long-term Debt, etc. (Details)
Long-term Debt, etc. (Details) - USD ($) $ in Millions | Dec. 21, 2020 | Aug. 16, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||
Cumulative dividends in arrears | $ 42 | $ 42 | ||
Dividends declared | $ 0 | $ 0 | ||
Shares converted | 110,300,000 | 17,900,000 | ||
Exchange ratio | 1.239434862 | |||
Redeemable Convertible Preference Shares | ||||
Debt Instrument [Line Items] | ||||
Dividend rate | 8.00% | |||
Common Stock | ||||
Debt Instrument [Line Items] | ||||
Shares converted | 136,800,000 |
Related Party Promissory Note_2
Related Party Promissory Note and Convertible Debt (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||
Sep. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Nov. 30, 2019USD ($) | Aug. 31, 2019USD ($) | Feb. 28, 2019USD ($) | Nov. 30, 2018USD ($)item | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Aug. 16, 2020USD ($) | Mar. 23, 2020USD ($) | |
Debt Instrument [Line Items] | ||||||||||
Number of entities controlled by investors to whom debt was issued | item | 2 | |||||||||
Accrued interest | $ 5,200 | |||||||||
Gain on extinguishment of debt | $ 5,045 | |||||||||
Carrying value of debt | $ 286,100 | |||||||||
Unsecured promissory note | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Principal amount | $ 15,000 | |||||||||
Amount outstanding | $ 15,000 | |||||||||
Accrued interest | $ 300 | |||||||||
Repayment of debt | $ 10,000 | $ 5,000 | ||||||||
Interest expense paid | $ 1,100 | $ 200 | ||||||||
Unsecured promissory note | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Spread (as a percent) | 8.00% | |||||||||
Effective interest rate | 10.875% | |||||||||
$100M Notes | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Principal amount | $ 100,000 | |||||||||
Amount outstanding | $ 86,100 | |||||||||
Accrued interest | $ 7,400 | |||||||||
Interest rate | 12.00% | |||||||||
Recognition Of Embedded Derivative Liability | $ 17,800 | |||||||||
Unamortized debt discount | 13,900 | |||||||||
Interest expense | $ 3,800 | |||||||||
Percentage of cash price per share paid | 80.00% | 80.00% | 80.00% | |||||||
Debt instrument conversion price | $ 500,000 | $ 500,000 | ||||||||
Unpaid and accrued interest, forgiveness | 7,400 | |||||||||
Gain on extinguishment of debt | 8,300 | |||||||||
Carrying value of debt | 88,700 | |||||||||
Fair value of the embedded derivative liability | 17,700 | |||||||||
Fair value of Notes | $ 105,600 | $ 105,600 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Thousands | Feb. 28, 2018USD ($)item | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Lessee, Lease, Description [Line Items] | |||
Percentage of escalation clause per annum | 3.00% | ||
Non-cash operating lease expense | $ 1,500 | $ 1,400 | |
Number of options to extend the lease term | item | 2 | ||
Commencing period | 60 months | ||
Operating lease right-of-use asset | $ 14,500 | 12,913 | 13,545 |
Incremental borrowing rate | 7.90% | ||
Operating lease liabilities | $ 14,500 | $ 13,706 | $ 14,100 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued Liabilities, Current | Accrued Liabilities, Current | |
Weighted average remaining lease term | 12 years 3 months 18 days | 13 years 3 months 18 days | |
Maturities of operating lease liabilities | |||
2021 | $ 1,507 | ||
2022 | 1,553 | ||
2023 | 1,599 | ||
2024 | 1,647 | ||
2025 | 1,697 | ||
Thereafter | 14,092 | ||
Total lease payments | 22,095 | ||
Less: imputed interest | 8,389 | ||
Present value of operating lease liabilities | $ 14,500 | 13,706 | $ 14,100 |
Current portion of operating lease liabilities | 444 | 368 | |
Operating lease liabilities, net of current portion | 13,262 | 13,706 | |
Investor | |||
Lessee, Lease, Description [Line Items] | |||
Term of lease | 15 years | ||
Related party transaction amount | 1,700 | $ 1,700 | |
Board of Directors Chairman [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Related party transaction amount | $ 541 |
Contingent Earnout Shares Lia_2
Contingent Earnout Shares Liability (Details) $ / shares in Units, $ in Thousands, shares in Millions | Dec. 21, 2020USD ($)item$ / sharesshares | Dec. 31, 2020USD ($)shares |
Embedded Derivative [Line Items] | ||
Recognition of contingent earnout share liability | $ | $ 248,900 | $ (248,878) |
Gain on fair value change in contingent earnout share liability | $ | $ 115,375 | |
Earn Out Shares [Member] | ||
Embedded Derivative [Line Items] | ||
Number of shares issued or issuable | shares | 15 | 15 |
Fair value of derivative liability | $ | $ 133,500 | |
Contingent Consideration, Earnout Shares, Tranche 1 [Member] | ||
Embedded Derivative [Line Items] | ||
Earnout share price target | $ / shares | $ 18 | |
Number of days to exceed target price | 20 | |
Number of consecutive days in period for exceeding price | 30 | |
Share price target period | 2 years | |
Number of shares issued or issuable | shares | 5 | |
Contingent Consideration, Earnout Shares, Tranche 2 [Member] | ||
Embedded Derivative [Line Items] | ||
Earnout share price target | $ / shares | $ 25 | |
Number of days to exceed target price | 20 | |
Number of consecutive days in period for exceeding price | 30 | |
Share price target period | 4 years | |
Number of shares issued or issuable | shares | 5 | |
Contingent Consideration, Earnout Shares, Tranche 3 [Member] | ||
Embedded Derivative [Line Items] | ||
Earnout share price target | $ / shares | $ 30 | |
Number of days to exceed target price | 20 | |
Number of consecutive days in period for exceeding price | 30 | |
Share price target period | 5 years | |
Number of shares issued or issuable | shares | 5 |
Stock-based Compensation - Stoc
Stock-based Compensation - Stock Options (Details) - shares | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 21, 2020 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Exchange ratio | 1.239434862 | |||
Number of shares authorized | 18,162,573 | 15,281,513 | 26,898,554 | 7,064,779 |
Vesting period | 4 years | |||
Grants in period | 209 | |||
Options to purchase common shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expiration period | 10 years | |||
Vesting percentage | 25.00% | |||
Vesting period | 3 years | |||
Performance Based Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants in period | 0 | 0 |
Stock-based Compensation - Valu
Stock-based Compensation - Valuation assumptions, options (Details) - Options to purchase common shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Risk free interest rates | 1.62% | 1.69% |
Expected lives (in years) | 6 years | 6 years |
Expected volatility | 60.00% | 60.00% |
Stock-based Compensation - Opti
Stock-based Compensation - Option activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Shares | ||
Outstanding beginning balance | 1,512 | |
Granted | 209 | |
Forfeited | (973) | |
Exercised | (424) | |
Outstanding ending balance | 324 | 1,512 |
Weighted Average Exercise Price | ||
Outstanding beginning balance (in dollars per share) | $ 0.02 | |
Granted (in dollars per share) | 0.02 | |
Forfeited (in dollars per share) | 0.01 | |
Exercised (in dollars per share) | 0.02 | |
Outstanding ending balance (in dollars per share) | $ 0.02 | $ 0.02 |
Additional disclosures | ||
Weighted average remaining contractual life (years) | 8 years 5 months 19 days | 9 years 7 months 20 days |
Aggregate Intrinsic Value, outstanding | $ 137 | $ 637 |
Stock-based Compensation - Op_2
Stock-based Compensation - Options - Narratives (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock, shares issued | 235,753,000 | 108,838,000 |
Common stock, shares outstanding | 235,753,000 | 108,838,000 |
Options outstanding | 324 | 1,512 |
Vesting period | 4 years | |
Options to purchase common shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Liability related to unvested awards | $ 0.2 | $ 0.1 |
Unvested options exercised | 421,097 | |
Common stock, shares issued | 235,753,437 | |
Shares issued upon early exercise of share options that remain unvested. | 5,279,906 | |
Options outstanding | 324,298 | |
Unvested options outstanding | 203,177 | |
Vesting period | 3 years | |
Intrinsic value of options exercised | $ 0.1 | 3.3 |
Total grant date fair value of share options granted | $ 0.1 | $ 3.5 |
Weighted average grant date fair value per share of options | $ 0.44 | $ 0.39 |
Share-based compensation expense | $ 0.9 | $ 0.3 |
Total unrecognized compensation cost related to options | $ 2 | $ 3.2 |
Period of recognition, unrecognized compensation cost | 1 year 8 months 12 days | 2 years 9 months 18 days |
Options to purchase common shares | Research and development expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 0.7 | $ 0.1 |
Options to purchase common shares | Selling, General and Administrative Expenses [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 0.2 | $ 0.2 |
Stock-based Compensation - Rest
Stock-based Compensation - Restricted shares (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 18, 2020 | Dec. 31, 2020 | May 06, 2019 | Dec. 31, 2020 |
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||||
Vesting period | 4 years | |||
Restricted common shares | ||||
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||||
Shares sold | 30,188,011 | |||
Purchase price per share | $ 0.008 | |||
Vesting percentage | 25.00% | |||
Vesting period | 36 months | |||
SOP incremental fair value from modification | $ 105.3 | |||
SOP compensation expense | $ 77.7 | |||
Restricted common shares | Share-based Payment Arrangement, Tranche One | ||||
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||||
Vesting percentage | 12.50% | |||
Cumulative funding trigger for vesting | $ 100 | |||
Restricted common shares | Share-based Payment Arrangement, Tranche Two | ||||
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||||
Vesting percentage | 37.50% | |||
Vesting period | 36 months | |||
Restricted common shares | Share-based Payment Arrangement, Tranche Three | ||||
Employee Stock Ownership Plan (ESOP), Shares in ESOP [Abstract] | ||||
Vesting percentage | 50.00% |
Stock-based Compensation - Re_2
Stock-based Compensation - Restricted stock units and Equity Grants (Details) - USD ($) $ in Millions | Nov. 25, 2020 | Jan. 31, 2021 | Dec. 31, 2020 | Aug. 31, 2020 | Dec. 31, 2020 | Dec. 21, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized | 18,162,573 | 18,162,573 | 26,898,554 | 15,281,513 | 7,064,779 | |||
Vesting period | 4 years | |||||||
RSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized | 1,003,828 | 8,027,473 | ||||||
Granted | 4,285,026 | |||||||
Number of shares per unit | 1 | |||||||
Share-based compensation expense | $ 3.5 | |||||||
Number of shares for which authorization has been withdrawn | 2,503,011 | |||||||
Shares approved but not yet granted | 1,239,435 | |||||||
Shares cancelled | 240,441 | |||||||
Shares whose vesting was accelerated | 998,994 | |||||||
Grant date fair value | 11.7 | $ 11.7 | ||||||
RSUs | Subsequent Event [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Expense for accelerated vesting | $ 18 | |||||||
PSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized | 1,003,828 | |||||||
Mr. Aquila | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ 1 | |||||||
Mr. Aquila | RSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized | 1,003,828 | |||||||
Total fair value of shares granted | $ 19.4 | |||||||
Number of shares per unit | 1 | |||||||
Vesting period | 3 years | |||||||
Mr. Aquila | PSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares authorized | 1,003,828 | |||||||
Total fair value of shares granted | $ 15.6 | |||||||
Number of shares per unit | 1 |
Stock-based Compensation - Re_3
Stock-based Compensation - Restricted shares activity (Details) - Restricted common shares $ / shares in Units, $ in Millions | 12 Months Ended | |
Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | |
Shares | ||
Nonvested at December 31, 2019 | shares | 18,335 | |
Granted | shares | 8,657 | |
Vested | shares | (5,468) | |
Repurchased | shares | (5,413) | |
Nonvested at December 31, 2020 | shares | 16,111 | 18,335 |
Weighted-Average Grant-Date Fair Value | ||
Nonvested at December 31, 2019 (in dollars per share) | $ / shares | $ 0.20 | |
Granted (in dollars per share) | $ / shares | 10.67 | $ 0.20 |
Vested (in dollars per share) | $ / shares | 9.65 | |
Repurchased (in dollars per share) | $ / shares | 0.19 | |
Nonvested at December 31, 2020 (in dollars per share) | $ / shares | $ 9.19 | $ 0.20 |
Total fair value of shares granted | $ 92.4 | $ 1.8 |
Share-based compensation expense | 83.4 | 1.5 |
Unrecognized compensation cost | 116.9 | |
Unrecognized compensation cost, portion recognized in 2021 | 92.3 | |
Unrecognized compensation cost, portion recognized in 2022 | 20.5 | |
Unrecognized compensation cost, portion recognized in 2023 | 3.7 | |
Unrecognized compensation cost, portion recognized in 2024 | 0.4 | |
Research and development expense | ||
Weighted-Average Grant-Date Fair Value | ||
Share-based compensation expense | 58.7 | 0.6 |
Selling, General and Administrative Expenses [Member] | ||
Weighted-Average Grant-Date Fair Value | ||
Share-based compensation expense | $ 24.7 | $ 0.9 |
Capital Structure - Shares Auth
Capital Structure - Shares Authorized (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
Capital Structure | ||
Shares authorized | 510,000,000 | |
Common Stock, Shares Authorized | 500,000,000 | 482,967,000 |
Preferred Stock, Shares Authorized | 10,000,000 | 0 |
Common Stock, Shares, Issued | 235,753,000 | 108,838,000 |
Common Stock, Shares, Outstanding | 235,753,000 | 108,838,000 |
Preferred Stock, Shares Issued | 0 | |
Preferred Stock, Shares Outstanding | 0 |
Capital Structure - Warrants ou
Capital Structure - Warrants outstanding (Details) | 12 Months Ended |
Dec. 31, 2020D$ / sharesshares | |
Class of Warrant or Right [Line Items] | |
Shares of common stock per warrant | shares | 1 |
Warrant exercise price | $ / shares | $ 11.50 |
Period for adjustment of warrant exercise price | 30 days |
Redemption price | $ / shares | $ 0.01 |
Written notice of redemption | 30 days |
Closing price | $ / shares | $ 18 |
Trading days | D | 20 |
Consecutive trading days | 30 days |
Public Warrants | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding | shares | 22,511,238 |
Private Warrants | |
Class of Warrant or Right [Line Items] | |
Warrants outstanding | shares | 1,842,106 |
Net Loss per Share (Details)
Net Loss per Share (Details) - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Adjustment for accumulated dividends on convertible preferred shares | $ 42 | $ 13.9 |
Early exercise of unvested share options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 5,280 | 9,396 |
Options to purchase common shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 324 | 1,512 |
Restricted common shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 7,587 | 18,335 |
RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount | 8,524 |
Income Taxes - Provision compon
Income Taxes - Provision components and Reconciliation of income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current Federal, State and Local, Tax Expense (Benefit) [Abstract] | ||
Provision for state income taxes | $ 2 | |
Provision for income taxes | 2 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | ||
Tax at Cayman statutory rate | (18,861) | |
Foreign rate differential | $ (18,622) | |
State tax - net of federal benefit | 2 | (8,493) |
Officer compensation | 1,531 | 24 |
Cancellation of debt income | 7,676 | |
Transaction costs | 3,605 | |
Other permanent differences | 16 | |
U.S. tax credits | (1,369) | (3,497) |
Change in valuation allowance | 7,402 | $ 30,588 |
Provision for income taxes | $ 2 |
Income Taxes - Net deferred inc
Income Taxes - Net deferred income tax assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Components of Deferred Tax Assets [Abstract] | |||
Net operating loss carry-forwards | $ 70,175 | $ 30,631 | |
Research and development credits | 10,121 | 7,927 | |
Interest expense | 1,901 | 1,975 | |
Stock-based compensation | 5,313 | 755 | |
Accrued rent | (227) | ||
Earnout shares liability | 37,359 | ||
Fixed assets | 2,189 | ||
Accruals and others | 1,372 | 556 | |
Total gross deferred income tax assets | 128,203 | 41,844 | |
Less: Valuation allowance | $ (128,203) | $ (41,844) | $ (11,256) |
Income Taxes - Valuation allowa
Income Taxes - Valuation allowance on the deferred income tax assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes | ||
Increase (decrease) in valuation allowance | $ (86,359) | $ (30,588) |
Beginning balance | (41,844) | (11,256) |
Additions charged to income tax provision | (86,359) | (30,588) |
Ending balance | $ (128,203) | $ (41,844) |
Income Taxes - NOLs, credits (D
Income Taxes - NOLs, credits (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | $ 228.8 | |
State and Local Jurisdiction | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 316.8 | |
Research and development | ||
Operating Loss Carryforwards [Line Items] | ||
Tax credits | $ 10.1 | $ 7.9 |
Income Taxes - Gross unrecogniz
Income Taxes - Gross unrecognized tax benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Unrecognized Tax Benefits, Beginning Balance | $ (8,427) | $ (1,870) |
Increases in balances related to tax provisions taken during current period | (2,737) | (6,557) |
Unrecognized Tax Benefits, Ending Balance | (11,164) | (8,427) |
Uncertain tax positions | 11,200 | |
Income tax examination, interest | 0 | 0 |
Income tax examination, penalties | $ 0 | $ 0 |