Tesla 2012 Annual Report Download - page 96

Table of Contents
to fund certain project costs upfront, which costs may then be reimbursed by loans under the DOE Loan Facility once the dedicated account is
depleted, or as part of the final advance for the applicable project. We will be then required to deposit a portion of these reimbursements into the
dedicated account, in an amount equal to up to 30% of the remaining project costs for the applicable project, and these amounts may similarly be
used by us to fund project costs and cost overruns and will similarly be eligible for reimbursement by the draw-down of additional loans under
the DOE Loan Facility once used in full, or as part of the final advance for the applicable project. Depending on the timing and magnitude of our
draw-downs and the funding requirements of the dedicated account, the balance of the dedicated account will fluctuate throughout the period in
which we plan to make draw-downs under the DOE Loan Facility. Upon completion of our final advance under the DOE Loan Facility, the
balance in the dedicated account will be fully transferred out of the dedicated account. As of December 31, 2011 and 2010, $23.5 million and
$73.6 million were held in the dedicated account, respectively.
For more information on the DOE Loan Facility, see Note 9 to our Consolidated Financial Statements included in this Annual Report on
Form 10-K under Item 8. Financial Statements and Supplementary Data.
Initial Public Offering and Toyota Concurrent Private Placement
On June 28, 2010, our registration statement on Form S-
1 relating to our IPO was declared effective by the SEC. The IPO closed on July 2,
2010, at which time we sold 11,880,600 shares of our common stock and received cash proceeds of $188.8 million from this transaction, net of
underwriting discounts and commissions. Additionally, we incurred offering costs of $4.4 million related to the IPO.
Concurrent with the closing of our IPO, we sold 2,941,176 shares of our common stock to Toyota in a private placement transaction for
aggregate proceeds of $50.0 million.
Panasonic Private Placement
In November 2010, we entered into a common stock purchase agreement with an entity affiliated with Panasonic Corporation (Panasonic)
pursuant to which we issued and sold an aggregate of 1,418,573 shares of our common stock for aggregate proceeds of $30.0 million.
Follow-on Offering and Concurrent Private Placements
In June 2011, we completed a follow-on offering of common stock in which we sold a total of 6,095,000 shares of our common stock and
received cash proceeds of $172.7 million from this transaction, net of underwriting discounts.
Concurrent with our follow-on offering, we also sold 1,416,000 shares of our common stock to Elon Musk, our Chief Executive Officer
and cofounder, and 637,475 shares of our common stock to Blackstar Investco LLC, an affiliate of Daimler and received total cash proceeds of
$59.1 million in the private placements. No underwriting discounts or commissions were paid in connection with these private placements.
Leasing Activities
In February 2010, we began offering a leasing program to qualified customers in the United States for the Tesla Roadster. Through our
wholly owned subsidiary, qualifying customers are permitted to lease the Tesla Roadster for 36 months, after which time they have the option of
either returning the vehicle to us or purchasing it for a pre-determined residual value.
When compared to our sales of vehicles, our leasing activities will spread the cash inflows that we would otherwise receive upon the sale
of a vehicle, over the lease term and final disposition of the leased vehicle. As such, our cash and working capital requirements will be directly
impacted and if leasing volume increases significantly, the impact may be material. However, after taking into consideration our current and
planned sources of operating cash, our ability to monitor and prospectively adjust our leasing activity, as well as our intent to collect
nonrefundable deposits for leased vehicles that are manufactured to specification, we do not believe that our leasing operations materially
adversely impact our ability to meet our commitments and obligations as they become due. As we will also be exposed to credit risk related to
the timely collection of lease payments from our customers, we intend to utilize our credit approval and ongoing review processes in order to
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