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Table of Contents
Environmental Liabilities
We are subject to federal and state laws and regulations for the protection of the environment, including those related to the discharge of
hazardous materials and remediation of contaminated sites. In October 2010, we completed the purchase of our Tesla Factory located in
Fremont, California from New United Motor Manufacturing, Inc. (NUMMI). NUMMI has previously identified environmental conditions at the
Fremont site which could affect soil and groundwater. As the owner of the Fremont site, we may be responsible for the entire investigation and
remediation of any environmental contamination at the Fremont site, whether it occurred before or after the date we purchased the property.
Upon the completion of the purchase in October 2010, we recorded the fair value of the environmental liabilities that we estimated to be $5.3
million. The fair value of these liabilities was determined based on an expected value analysis of the related potential costs to investigate,
remediate and manage various environmental conditions that were identified as part of NUMMI’s facility decommissioning activities as well as
our own diligence efforts. Estimated potential costs are not discounted to present value as the timing of payments cannot be reasonably
estimated. We assess adequacy of our accrued environmental liabilities for investigation and remediation of any environmental contamination at
least quarterly and adjust our estimates as appropriate. As of December 31, 2013 and 2012, we accrued a total of $5.5 million and $5.3 million
related to these environmental liabilities, respectively (see Note 12).
Net Loss per Share of Common Stock
Our basic and diluted net loss per share of common stock is calculated by dividing net loss by the weighted-average shares of common
stock outstanding for the period. Potentially dilutive shares, which are based on the number of shares underlying outstanding stock options and
warrants as well as our Notes, are not included when their effect is antidilutive.
The following table presents the potential weighted common shares outstanding that were excluded from the computation of basic and
diluted net loss per share of common stock for the periods, related to the following securities:
Since we will settle the principal amount of our 1.50% convertible senior notes (see Note 6) in cash, we use the treasury stock method for
calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have
a dilutive impact on diluted net income per share of common stock when the average market price of our common stock for a given period
exceeds the conversion price of $124.52 per share.
3. Balance Sheet Components
Inventory
As of December 31, 2013 and 2012, our inventory consisted of the following (in thousands):
105
Year Ended December 31,
2013
2012
2011
Stock options
13,881,355
25,007,776
15,806,663
Convertible senior notes
411,560
—
—
Employee stock purchase plan
23,296
59,763
39,131
Restricted stock units
224
—
—
DOE warrant
1,061,439
2,342,353
2,220,617
Common stock subject to repurchase
—
—
278
December 31,
2013
December 31,
2012
Raw materials
$
184,665
$
163,637
Work in process
42,500
24,535
Finished goods
69,324
62,559
Service parts
43,866
17,773
Total
$
340,355
$
268,504