Subsequent Events |
3 Months Ended |
|---|---|
Apr. 02, 2023 | |
| Subsequent Events [Abstract] | |
| Subsequent Events | Subsequent Events Convertible Senior Notes
On April 20, 2023, the Company issued $172.5 million aggregate principal amount of 3.0% convertible senior notes due 2028 (the “Convertible Senior Notes”), pursuant to an indenture, dated as of April 20, 2023 (the “Indenture”), between the Company and U.S. Bank Trust Company, National Association, as trustee (the “Trustee”). The offering and sale of the Convertible Senior Notes were made by the Company to the initial purchasers in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), for resale by the initial purchasers to qualified institutional buyers (as defined in the Securities Act) pursuant to the exemption from registration provided by Rule 144A under the Securities Act. The issuance includes the exercise in full by the initial purchasers of their option to purchase an additional $22.5 million aggregate principal amount of Convertible Senior Notes. $10.0 million principal amount of Convertible Senior Notes (the “Affiliate Notes”) were issued to an entity affiliated with Thurman John “T.J.” Rodgers, the Company’s Chairman (the “Affiliated Investor”), in a concurrent private placement.
The Convertible Senior Notes are unsecured obligations of the Company and bear interest at a rate of 3.0% per year from April 20, 2023, and will be payable semiannually in arrears on May 1 and November 1 of each year, beginning on November 1, 2023. The Convertible Senior Notes and the Affiliated Notes will mature on May 1, 2028 unless earlier converted, redeemed or repurchased.
The net proceeds from the offering are approximately $165.7 million. The Company used approximately 10% of the gross proceeds from the offering to pay the cost of the capped call transactions entered on April 20, 2023 in connection with the offering. The remaining net proceeds will be used to build out a second battery cell manufacturing facility and fund the acquisition of production lines of the Company’s second-generation manufacturing equipment, and for working capital and other general corporate purposes.
Capped Call Transactions
The capped call transactions are generally expected to reduce the potential dilution to the Company's common stock upon any conversion of the Convertible Senior Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted Convertible Senior Notes, as the case may be, with such reduction and/or offset subject to a cap based on a cap price initially equal to $21.17 per share (which represents a premium of 56.0% over the last reported sale price of the Company's common stock of $13.57 per share on The Nasdaq Global Select Market on April 17, 2023), and is subject to certain adjustments under the terms of the capped call transactions.
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