Tesla 2012 Annual Report Download - page 47

Table of Contents
Many of these factors are largely outside our control, and any negative perceptions about our long-term business prospects, even if
exaggerated or unfounded, would likely harm our business and make it more difficult to raise additional funds when needed.
We may need to raise additional funds and these funds may not be available to us when we need them. If we cannot raise additional funds
when we need them, our operations and prospects could be negatively affected.
The design, manufacture, sale and servicing of automobiles is a capital intensive business. As of December 31, 2011, we had $492.7
million in principal sources of liquidity available from our cash and cash equivalents, short-term marketable securities, cash held in our
dedicated DOE account and the remaining amounts available under the DOE Loan Facility. This includes our cash and cash equivalents in the
amount of $255.3 million which includes investments in money market funds, short-term marketable securities of $25.1 million, cash of $23.5
million deposited in a dedicated DOE account in accordance with the requirements of our DOE Loan Facility, and $188.8 million available
under the DOE Loan Facility. We expect that these principal sources of liquidity together with our current projections of cash flow from
operating activities will provide us adequate liquidity until we reach profitability in 2013. However, if there are delays in the launch of Model S
or Model X, if we are unable to draw down the anticipated funds under the DOE Loan Facility for any reason, including our failure to meet
operating or financial covenants, or if the costs in building our Model S, Model X and powertrain manufacturing facilities exceed our
expectations or if we incur any significant unplanned expenses or embark on new significant strategic investments, we may need to raise
additional funds through the issuance of equity, equity-related or debt securities or through obtaining credit from government or financial
institutions. This capital will be necessary to fund our ongoing operations, continue research and development projects, including those for our
planned Model X crossover, establish sales and service centers, improve infrastructure such as expanded battery assembly facilities, and to make
the investments in tooling and manufacturing capital required to introduce Model S and Model X.
In particular, we have only recently begun to accept customer reservation payments on our Model X crossover, can provide no assurance
that customers will be willing to make such payments and accordingly may be reliant on other financing sources to fund the development of this
vehicle. We cannot be certain that additional funds will be available to us on favorable terms when required, or at all. If we cannot raise
additional funds when we need them, our financial condition, results of operations, business and prospects could be materially adversely
affected. Additionally, under our DOE Loan Facility, we face restrictions on our ability to incur additional indebtedness, and in the future may
need to obtain a waiver from the DOE in order to do so. We may not be able to obtain such waiver from the DOE which may harm our business.
Future issuance of equity or equity-related securities will dilute the ownership interest of existing stockholders and our issuance of debt
securities could increase the risk or perceived risk of our company.
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unfamiliarity with or uncertainty about the Tesla Roadster and Model S;
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uncertainty about the long
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term marketplace acceptance of alternative fuel vehicles generally, or electric vehicles specifically;
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the prospect that we will need ongoing infusions of external capital to fund our planned operations;
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the size of our expansion plans in comparison to our existing capital base and scope and history of operations; and
• the prospect or actual emergence of direct, sustained competitive pressure from more established automakers, which may be more
likely if our initial efforts are perceived to be commercially successful.