Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | May 07, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-39288 | |
Entity Registrant Name | AppHarvest, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-5042965 | |
Entity Address, Address Line One | 500 Appalachian Way | |
Entity Address, City or Town | Morehead | |
Entity Address, State or Province | KY | |
Entity Address, Postal Zip Code | 40351 | |
City Area Code | 606 | |
Local Phone Number | 653-6100 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
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 Common Stock, Shares Outstanding | 100,253,268 | |
Entity Central Index Key | 0001807707 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Common stock, $0.0001 par value per share | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common stock, $0.0001 par value per share | |
Trading Symbol | APPH | |
Security Exchange Name | NASDAQ | |
Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50 per share | |
Trading Symbol | APPHW | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current Assets | ||
Cash and cash equivalents | $ 297,660 | $ 21,909 |
Accounts receivable, net | 1,182 | 0 |
Inventories, net | 4,903 | 3,387 |
Prepaid expenses and other current assets | 3,531 | 481 |
Total current assets | 307,276 | 25,777 |
Operating lease right-of-use assets, net | 1,703 | 1,307 |
Property and equipment, net | 190,962 | 152,645 |
Other assets, net | 7,481 | 1,188 |
Total non-current assets | 200,146 | 155,140 |
Total assets | 507,422 | 180,917 |
Current Liabilities: | ||
Accounts payable | 23,070 | 1,342 |
Accrued expenses | 8,204 | 5,184 |
Current portion of lease liabilities with a related party | 0 | 59,217 |
Current portion of lease liabilities | 300 | 166 |
Current portion of financing obligation with a related party | 0 | 58,795 |
Note payable with a related party | 0 | 30,000 |
Other current liabilities | 832 | 77 |
Total current liabilities | 32,406 | 154,781 |
Lease liabilities, net of current portion | 1,850 | 1,370 |
Deferred income tax liabilities | 1,769 | |
Private Warrant liabilities | 29,920 | 0 |
Other liabilities | 227 | 0 |
Total non-current liabilities | 33,766 | 1,370 |
Total liabilities | 66,172 | 156,151 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity | ||
Preferred stock, par value $0.0001, 10,000 shares authorized, 0 issued and outstanding, as of March 31, 2021 and December 31, 2020, respectively | 0 | 0 |
Common stock, par value $0.0001, 750,000 shares authorized, 97,925 and 44,461 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively | 10 | 4 |
Additional paid-in capital | 491,552 | 45,890 |
Accumulated deficit | (49,643) | (21,128) |
Accumulated Other Comprehensive Income (Loss), Net of Tax | (669) | 0 |
Total stockholders’ equity | 441,250 | 24,766 |
Total liabilities and stockholders’ equity | $ 507,422 | $ 180,917 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 750,000,000 | 750,000,000 |
Common stock, shares issued | 97,925,000 | 44,461,000 |
Common stock, shares outstanding | 97,925,000 | 44,461,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Net sales | $ 2,299,000 | $ 0 |
Cost of goods sold | 6,836,000 | 0 |
Gross profit (loss) | (4,537,000) | 0 |
Operating expenses: | ||
Selling, general and administrative expenses | 31,489,000 | 980,000 |
Total operating expenses | 31,489,000 | 980,000 |
Loss from operations | (36,026,000) | (980,000) |
Other income (expense): | ||
Development fee income from a related party | 0 | 134,000 |
Interest expense from related parties | (658,000) | (2,000) |
Change in fair value of Private Warrants | 9,826,000 | 0 |
Other | 356,000 | 30,000 |
Loss before income taxes | (26,502,000) | (818,000) |
Income tax expense | (2,013,000) | 0 |
Net loss | (28,515,000) | (818,000) |
Other comprehensive loss: | ||
Net unrealized loss on cash flow hedges, net of tax | (669,000) | 0 |
Comprehensive loss | $ (29,184,000) | $ (818,000) |
Net loss per common share: | ||
Net loss per common share, basic (in dollars per share) | $ (0.35) | $ (0.02) |
Net loss per common share, diluted (in dollars per share) | $ (0.35) | $ (0.02) |
Weighted average common shares outstanding: | ||
Weighted-average common shares outstanding, basic (in shares) | 80,729,000 | 32,858,000 |
Weighted-average common shares outstanding, diluted (in shares) | 80,729,000 | 32,858,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | AOCI Attributable to Parent | Series A Preferred Stock | Series A-1 Preferred Stock | Series B Preferred Stock | Series C Preferred Stock | Previously Reported | Previously ReportedCommon Stock | Previously ReportedAdditional Paid-in Capital | Previously ReportedRetained Earnings | Previously ReportedAOCI Attributable to Parent | Previously ReportedSeries A Preferred Stock | Previously ReportedSeries A-1 Preferred Stock | Previously ReportedSeries B Preferred Stock | Previously ReportedSeries C Preferred Stock | Revision of Prior Period, Adjustment | Revision of Prior Period, AdjustmentCommon Stock | Revision of Prior Period, AdjustmentAdditional Paid-in Capital | Revision of Prior Period, AdjustmentRetained Earnings | Revision of Prior Period, AdjustmentAOCI Attributable to Parent | Revision of Prior Period, AdjustmentSeries A Preferred Stock | Revision of Prior Period, AdjustmentSeries A-1 Preferred Stock | Revision of Prior Period, AdjustmentSeries B Preferred Stock | Revision of Prior Period, AdjustmentSeries C Preferred Stock |
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | $ 0 | $ 0 | $ 0 | $ 5,203,000 | $ 992,000 | $ 6,063,000 | $ (5,203,000) | $ (992,000) | $ (6,063,000) | ||||||||||||||||||
Temporary equity, shares outstanding, beginning balance (in shares) at Dec. 31, 2019 | 0 | 0 | 0 | 2,770 | 392 | 1,483 | (2,770) | (392) | (1,483) | ||||||||||||||||||
Temporary equity, carrying amount, beginning balance at Dec. 31, 2019 | $ 0 | $ 0 | $ 0 | $ 5,203,000 | $ 992,000 | $ 6,063,000 | $ (5,203,000) | $ (992,000) | $ (6,063,000) | ||||||||||||||||||
Temporary equity, shares outstanding, ending balance (in shares) at Mar. 31, 2020 | 0 | 0 | 0 | ||||||||||||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | $ 0 | $ 0 | $ 0 | 5,203,000 | 992,000 | 6,063,000 | (5,203,000) | (992,000) | (6,063,000) | ||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 30,800 | 9,677 | 21,123 | ||||||||||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 9,076,000 | $ 3,000 | $ 12,753,000 | $ (3,680,000) | $ (3,182,000) | $ 1,000 | $ 497,000 | $ (3,680,000) | $ 12,258,000 | $ 2,000 | $ 12,256,000 | $ 0 | |||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||||||||||
Issuance of preferred shares, net (in shares) | 2,470 | ||||||||||||||||||||||||||
Issuance of preferred shares, net | 4,880,000 | 4,880,000 | |||||||||||||||||||||||||
Stock-based compensation | 19,000 | 19,000 | |||||||||||||||||||||||||
Net loss | (818,000) | (818,000) | |||||||||||||||||||||||||
Net unrealized loss on cash flow hedges, net of tax | 0 | ||||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 33,270 | ||||||||||||||||||||||||||
Ending balance at Mar. 31, 2020 | 13,157,000 | $ 3,000 | 17,652,000 | (4,498,000) | |||||||||||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | 0 | 0 | 0 | ||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | $ 0 | $ 0 | $ 0 | $ 0 | $ 5,203,000 | $ 992,000 | $ 10,942,000 | $ 28,069,000 | $ (5,203,000) | $ (992,000) | $ (10,942,000) | $ (28,069,000) | |||||||||||||||
Temporary equity, shares outstanding, beginning balance (in shares) at Dec. 31, 2020 | 0 | 0 | 0 | 0 | 2,770 | 392 | 2,632 | 5,131 | (2,770) | (392) | (2,632) | (5,131) | |||||||||||||||
Temporary equity, carrying amount, beginning balance at Dec. 31, 2020 | $ 0 | $ 0 | $ 0 | $ 0 | $ 5,203,000 | $ 992,000 | $ 10,942,000 | $ 28,069,000 | $ (5,203,000) | $ (992,000) | $ (10,942,000) | $ (28,069,000) | |||||||||||||||
Temporary equity, shares outstanding, ending balance (in shares) at Mar. 31, 2021 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | $ 0 | $ 0 | $ 0 | $ 0 | $ 5,203,000 | $ 992,000 | $ 10,942,000 | $ 28,069,000 | $ (5,203,000) | $ (992,000) | $ (10,942,000) | $ (28,069,000) | |||||||||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 44,461 | 9,750 | 34,711 | ||||||||||||||||||||||||
Beginning balance at Dec. 31, 2020 | 24,766,000 | $ 4,000 | 45,890,000 | (21,128,000) | $ 0 | $ (20,441,000) | $ 1,000 | $ 686,000 | $ (21,128,000) | $ 0 | $ 45,207,000 | $ 3,000 | $ 45,204,000 | $ 0 | $ 0 | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||||||||||||||||||
Business Combination and PIPE Shares, net (in shares) | 53,361 | ||||||||||||||||||||||||||
Business Combination and PIPE Shares, net | 433,527,000 | $ 6,000 | 433,521,000 | ||||||||||||||||||||||||
Conversion of Private Warrants | 5,819,000 | 5,819,000 | |||||||||||||||||||||||||
Stock option exercise (in shares) | 103 | ||||||||||||||||||||||||||
Stock option exercise | 35,000 | 35,000 | |||||||||||||||||||||||||
Stock-based compensation | 6,287,000 | 6,287,000 | |||||||||||||||||||||||||
Net loss | (28,515,000) | (28,515,000) | |||||||||||||||||||||||||
Net unrealized loss on cash flow hedges, net of tax | (669,000) | (669,000) | |||||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 97,925 | ||||||||||||||||||||||||||
Ending balance at Mar. 31, 2021 | $ 441,250,000 | $ 10,000 | $ 491,552,000 | $ (49,643,000) | $ (669,000) | ||||||||||||||||||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||||||||||||||||||||
Temporary equity, carrying amount, ending balance | $ 0 | $ 0 | $ 0 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating Activities | ||
Net loss | $ (28,515) | $ (818) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Change in fair value of Private Warrants | (9,826) | 0 |
Deferred income tax provision | 2,013 | 0 |
Depreciation and amortization | 1,802 | 21 |
Stock-based compensation expense | 6,287 | 19 |
Rent expense in excess of rent payments | 19 | 0 |
Interest accrual with a related party | 0 | 2 |
Amortization of development fee with a related party | 0 | (134) |
Changes in operating assets and liabilities | ||
Accounts receivable | (1,182) | 0 |
Inventory | (1,516) | 0 |
Prepaid expenses and other current assets | (3,133) | 2 |
Other assets, net | (5,993) | (20) |
Accounts payable | 8 | (98) |
Accrued expenses | 3,694 | 52 |
Other current liabilities | (42) | 21 |
Other non-current liabilities | 227 | 0 |
Net cash used in operating activities | (36,157) | (953) |
Investing Activities | ||
Purchases of property and equipment | (11,183) | (83) |
Purchases of property and equipment from a related party | (122,911) | 0 |
Advances on equipment | (444) | 0 |
Net cash used in investing activities | (134,538) | (83) |
Financing Activities | ||
Proceeds from Business Combination and PIPE shares, net | 448,500 | 0 |
Payments on financing obligation to a related party | (2,089) | 0 |
Proceeds from stock option exercise | 35 | 0 |
Issuance of preferred stock, net | 0 | 4,880 |
Net cash provided by financing activities | 446,446 | 4,880 |
Change in cash and cash equivalents | 275,751 | 3,844 |
Cash and Cash Equivalents | ||
Beginning of period | 21,909 | 6,031 |
End of period | 297,660 | 9,875 |
Non-cash Activities: | ||
Fixed assets purchases in accounts payable | 20,313 | 0 |
Fixed assets purchases in accrued liabilities | 1,408 | 0 |
Operating lease right-of-use assets and liabilities | $ 735 | $ 30 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business AppHarvest was founded on January 19, 2018 and, together with its subsidiaries, is a sustainable food company creating a resilient and scalable ecosystem of applied technology greenhouses to serve the rapidly growing consumer demand for fresh, chemical-free, non-GMO fruits, vegetables and related products. AppHarvest is operating and building some of the largest and most advanced agricultural facilities in the world. AppHarvest combines conventional agricultural techniques with the latest in controlled environment agriculture (“CEA”) technology to grow high-quality fruits and vegetables throughout the year. AppHarvest’s vision is to create America’s AgTech capital from within Appalachia and provide better produce, better farming practices, and better jobs. Prior to October 2020, AppHarvest’s operations were limited to organizing and staffing, business planning, raising capital, and acquiring and developing properties for CEA. In October 2020, AppHarvest partially opened its first CEA facility in Morehead, Kentucky, which AppHarvest estimates can cultivat e more than 720,000 tomato plants with an approximate yield of more than 40 million pounds per year. AppHarvest harvested its first crop of beefsteak tomatoes in January 2021 and began harvesting its first crop of tomatoes on the vine in March 2021. AppHarvest’s Morehead CEA facility has been fully operational since March 2021 and AppHarvest is currently constructing two additional CEA facilities in Berea and Richmond, both in Madison County, Kentucky. AppHarvest is organized as a single operating segment. Substantially all of the assets and operations of AppHarvest are located in the United States (“U.S.”). Basis of Presentation On January 29, 2021, (the “Closing Date”), Novus Capital Corporation (“Novus”), a special purpose acquisition company, consummated the business combination agreement and plan of reorganization (the “Business Combination Agreement”) dated September 2020, by and among ORGA, Inc., a wholly owned subsidiary of Novus (“Merger Sub”), and AppHarvest Operations, Inc., a Delaware corporation (f/k/a AppHarvest, Inc.) (“Legacy AppHarvest”). Pursuant to the terms of the Business Combination Agreement, a business combination between Novus and Legacy AppHarvest was effected through the merger of Merger Sub with and into Legacy AppHarvest, with Legacy AppHarvest surviving the merger as a wholly-owned subsidiary of Novus (the “Merger” and, collectively with the other transactions described in the Business Combination Agreement, the “Business Combination”). On the Closing Date, Novus changed its name to AppHarvest, Inc. (the “Company”, “we”, “our” or “AppHarvest”). Pursuant to the Business Combination Agreement, the Merger was accounted for as a reverse recapitalization (the “Reverse Recapitalization”) in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) . Under this method of accounting, Novus is treated as the “acquired” company and Legacy AppHarvest is treated as the acquirer for financial reporting purposes. The Reverse Recapitalization was treated as the equivalent of Legacy AppHarvest issuing stock for the net assets of Novus, accompanied by a recapitalization. The net assets of Novus are stated at historical cost, with no goodwill or other intangible assets recorded. Legacy AppHarvest was determined to be the accounting acquirer based on the following predominant factors: • Legacy AppHarvest stockholders have the largest portion of voting rights in the Company; • The Board and Management are primarily composed of individuals associated with Legacy AppHarvest; and • Legacy AppHarvest was the larger entity based on historical operating activity and Legacy AppHarvest had the larger employee base at the time of the Business Combination. The consolidated assets, liabilities and results of operations prior to the Reverse Recapitalization are those of Legacy AppHarvest. The shares and corresponding capital amounts and losses per share, prior to the Business Combination, have been retroactively restated based on shares reflecting the exchange ratio established in the Business Combination. Activity within the Statements of Stockholders’ Equity for the issuance and repurchases of Legacy AppHarvest redeemable convertible preferred stock were also retroactively converted to Legacy AppHarvest common stock. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial reporting and Securities and Exchange Commission regulations. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year ended December 31, 2021. A description of the Company’s significant accounting policies is included in the Company’s audited consolidated financial statements as of and for the year ended December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the Legacy AppHarvest December 31, 2020 audited consolidated financial statements and the accompanying notes. The unaudited condensed consolidated financial statements include the accounts of the Company and its controlled subsidiaries. All significant intercompany accounts and transactions have been eliminated. Certain prior period balances have been reclassified to conform to the current period presentation in the unaudited condensed consolidated financial statements and the accompanying notes. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates in Condensed Consolidated Financial Statements In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Although these estimates are based on the Company’s knowledge of current events and actions the Company may undertake in the future, actual results could differ from those estimates and assumptions. Significant items subject to such estimates and assumptions include the recording of revenue, valuation of inventory, the valuation of stock-based compensation, the valuation of private warrants, lease accounting, the useful life of fixed assets and income taxes. The Company’s results can also be affected by economic, political, legislative, regulatory, legal actions, and the global volatility and general market disruption resulting from the global outbreak of the novel coronavirus disease (“COVID-19”). Economic conditions, such as recessionary trends, inflation, interest and monetary exchange rates, and government fiscal policies, can have a significant effect on operations. While the Company maintains reserves for anticipated liabilities and carries various levels of insurance, the Company could be affected by civil, criminal, environmental, regulatory or administrative actions, claims, or proceedings. Accounts Receivables Accounts receivable consist of amounts due from customers in connection with our normal business activities and are carried at sales value less allowance for doubtful accounts. The allowance for doubtful accounts is established to reflect the expected losses of accounts receivable based on past collection history, age, account payment status compared to invoice payment terms and specific individual risks identified. Write-offs are recorded against the allowance for doubtful accounts when all reasonable efforts for collection have been exhausted. The provision at March 31, 2021 and December 31, 2020 did not have a material impact on the condensed consolidated financial statements. Convertible Preferred Stock Prior to the Business Combination, the Company recorded shares of redeemable convertible preferred stock at their respective fair values on the dates of issuance, net of issuance costs. The Company applied the guidance in Accounting Standards Codification (“ASC”) 480-10-S99-3A and therefore classified all of its outstanding redeemable convertible preferred stock as temporary equity. The redeemable convertible preferred stock was recorded outside of stockholders’ equity because, in the event of certain deemed liquidation events considered not solely within the Company’s control, such as a merger, acquisition and sale of all or substantially all of the Company’s assets, the preferred stock would become redeemable at the option of the holders. In the event of a change of control of the Company, proceeds received from the sale of such shares would be distributed in accordance with the liquidation preferences set forth in the Company’s Amended and Restated Certificate of Incorporation then in effect. All convertible preferred stock previously classified as temporary equity was retroactively adjusted and reclassified to permanent equity as a result of the Business Combination. As a result of the Business Combination, each share of redeemable convertible preferred stock that was then issued and outstanding was automatically converted into Legacy AppHarvest Common Stock, such that each converted share of preferred stock was no longer outstanding and ceased to exist. Each share of Legacy AppHarvest common stock, including the Legacy AppHarvest common stock issued upon conversion of Legacy AppHarvest preferred stock, was converted into and exchanged for 2.1504 (the “Exchange Ratio”) shares of the Company’s common stock.The Exchange Ratio was established pursuant to the terms of the Business Combination Agreement. During the three-month period ended March 31, 2020, Legacy AppHarvest issued shares of Legacy AppHarvest Series B redeemable convertible preferred stock to new and existing investors for net proceeds of $4,880. Warrants At March 31, 2021, there were 13,250 warrants to purchase Common Stock outstanding, consisting of 10,500 public warrants (“Public Warrants”) and 2,750 private warrants (“Private Warrants”), (collectively, “Warrants”) held by the Novus initial stockholders. Each warrant entitles the registered holder to purchase one share of Common Stock at a price of $11.50 per share. The warrants expire on January 29, 2026, or earlier upon redemption or liquidation. The Company may redeem the Public Warrants: • In whole and not in part; • At a price of $0.01 per Warrant; • Upon not less than 30 days’ prior written notice of redemption; • If, and only if, the reported last sale price of the shares of common stock equals or exceeds $18.50 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations), for any 20 trading days within a 30 trading day period commencing at any time after the warrants become exercisable and ending on the third business day prior to the notice of redemption to warrant holders; and • if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying the warrants. 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 Public Warrants were determined to be equity classified in accordance with U.S. GAAP. The Private Warrants are identical to the Public Warrants except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. As a result of the provisions in the warrant agreement that provide for differences in the mechanics of a cashless exercise dependent upon the characteristics of the warrant holder, and because the holder of a warrant is not an input into the pricing of a fixed-for-fixed option on equity shares, such provisions preclude the Private Warrant from being classified in equity. Accordingly, the Private Warrants are classified as a liability and remeasured at fair value at each reporting date. The Company accounts for its Private Warrants in accordance with ASC 815-40, under which the Company has determined that the Private Warrants are recognized as liabilities at fair value and subject to re-measurement at each balance sheet date until exercised. Changes in fair value of the Private Warrants is recognized in the Company’s condensed consolidated statement of operations and comprehensive loss. The fair value of the Private Warrants is estimated at each measurement date using a Black-Scholes option pricing model. See Note 5 - Fair Value Measurements for inputs used in calculating the estimated fair value. Derivative Financial Instruments Derivative financial instruments are used to manage foreign currency exchange risks. The financial instruments used by the Company are straight-forward, non-leveraged instruments. The counterparties to these financial instruments are financial institutions with strong credit ratings. The Company maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit ratings of these institutions. For all transactions designated as hedges, the hedging relationships are formally documented at the inception and on an ongoing basis in offsetting changes in cash flows of the hedged transaction. The Company records derivative financial instruments on the condensed consolidated balance sheets as either an asset or liability measured at its fair value. Changes in a derivative's fair value (i.e. unrealized gains or losses) are recorded each period in earnings unless the derivative qualifies as a hedge on future cash flows. Gains and losses related to a hedge are either recognized in income immediately to offset the gain or loss on the hedged item, or deferred and recorded in the stockholders' equity section of the condensed consolidated balance sheets as a component of accumulated other comprehensive loss (“AOCL”) and subsequently recognized in the condensed consolidated statements of operations and comprehensive loss when the hedged item affects net income. The ineffective portion of the change in fair value of a hedge, if any, is recognized in income immediately. For derivative instruments that are not designated as hedges, the gain or loss related to the change in fair value is also recorded to net income immediately. New Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 is part of the FASB’s overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. ASU 2019-12 removes certain exceptions to the general principles of ASC 740, Income Taxes, in order to reduce the cost and complexity of its application in the areas of intraperiod tax allocation, deferred tax liabilities related to outside basis differences, year-to-date losses in interim periods and other areas within ASC 740. The Company adopted ASU 2019-12 on January 1, 2021 and the adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements. No other new accounting pronouncement recently issued or newly effective had or is expected to have a material impact on the condensed consolidated financial statements . |
Business Combination
Business Combination | 3 Months Ended |
Mar. 31, 2021 | |
Reverse Recapitalization [Abstract] | |
Business Combination | Business Combination As discussed in Note 1, on January 29, 2021, Novus completed the Business Combination with Legacy AppHarvest through the Merger, with Legacy AppHarvest surviving the Merger as a wholly-owned subsidiary of the Company. Upon the consummation of the Business Combination, each share of Legacy AppHarvest common stock issued and outstanding was canceled and converted into the right to receive 2.1504 shares of the Company’s common stock. Upon the closing of the Business Combination, the Company’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 760,000 shares, of which 750,000 shares were designated common stock, $0.0001 par value per share, and 10,000 shares designated Preferred Stock, $0.0001 par value per share. Each option to purchase Legacy AppHarvest common stock that was outstanding immediately prior to the Business Combination, whether vested or unvested, was converted into an option to purchase a number of shares of the Company’s common stock equal to the product (rounded down to the nearest whole number) of (i) the number of shares of Legacy AppHarvest common stock subject to such Legacy AppHarvest option and (ii) the Exchange Ratio, at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such Legacy AppHarvest option, divided by (B) the Exchange Ratio. Each restricted stock unit awarded by Legacy AppHarvest that was outstanding immediately prior to the Business Combination, whether vested or unvested, was converted into an award of restricted stock units to acquire a number shares of the Company’s common stock equal to the product (rounded down to the nearest whole number) of (1) the number of shares of Legacy AppHarvest common stock subject to the Legacy AppHarvest restricted stock unit award and (2) the Exchange Ratio. In connection with the execution of the Business Combination Agreement, the Company entered into separate subscription agreements (the “Subscription Agreements”) with certain investors (each a “Subscriber”), pursuant to which the Subscribers agreed to purchase, and the Company agreed to sell to the Subscribers, an aggregate of 37,500 shares of common stock (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $375,000, in a private placement pursuant to the Subscription Agreements (the “PIPE”). The PIPE investment closed concurrently with the closing of the Business Combination. Prior to the Business Combination, Novus had outstanding 10,000 Public Warrants and 3,250 Private Warrants which were listed on the Nasdaq Capital Market under the symbol “NOVSW.” Upon the closing of the Business Combination, they became listed on the Nasdaq Global Select Market under the symbol “APPHW.” The Warrants remain subject to the same terms and conditions as prior to the Business Combination. Also immediately prior to the closing of the Business Combination, Novus assumed the Legacy AppHarvest convertible note (the “Convertible Note”). Upon completion of the Business Combination, the outstanding principal and unpaid accrued interest due on the Legacy AppHarvest Convertible Note was converted into an aggregate of 3,242 shares of common stock, and the converted note was no longer outstanding, and ceased to exist. See Note 9 Note Payable with a Related Party. Upon consummation of the Business Combination and the closing of the PIPE, the most significant change in Legacy AppHarvest’s financial position and results of operations was a total net increase in cash and cash equivalents of approximately $435,239, including $375,000 in gross proceeds from the PIPE. The Business Combination is accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, Novus was treated as the “acquired” company for financial reporting purposes. See Note 1 Description of Business for further details. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of Legacy AppHarvest issuing stock for the net assets of Novus, accompanied by a recapitalization. The net assets of Novus are stated at historical cost, with no goodwill or other intangible assets recorded. The following table reconciles the elements of the Business Combination to the unaudited condensed consolidated statements of stockholders’ equity and cash flows for the three months ended March 31, 2021: Recapitalization Cash - Novus trust and cash, net of redemptions $ 99,896 Cash - PIPE financing 375,000 Non-cash Convertible Note conversion 30,808 Non-cash net liabilities assumed from Novus (2,850) Less: Fair value of assumed common stock Private Warrants (45,565) Less: transaction costs allocated to equity (23,762) Net impact on total stockholders’ equity 433,527 Less: cash payments for transaction costs at Closing (2,634) Less: non-cash Convertible Note conversion (30,808) Add: non-cash net liabilities assumed from Novus 2,850 Add: non-cash fair value of assumed common stock Private Warrants 45,565 Net impact on net cash provided by financing activities 448,500 Less: transaction costs included in net cash used in operating activities (a) (13,261) Total net increase in cash and cash equivalents $ 435,239 |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company began recognizing revenue in connection with its first harvest during the three months ended March 31, 2021, and generated no revenues prior to this period. Substantially all of the Company’s revenues are generated from the sale of tomatoes under an agreement with one customer, Mastronardi Produce Limited (“Mastronardi”). On March 28, 2019, the Company entered into a Purchase and Marketing Agreement (the “Mastronardi Morehead Agreement”) with Mastronardi pursuant to which Mastronardi will be the sole and exclusive marketer and distributor of all tomatoes, cucumbers, peppers, berries and leafy greens produced at the Company’s CEA facility in Morehead, Kentucky that meet certain quality standards (collectively, the “Products”). Under the terms of the Mastronardi Morehead Agreement, the Company is responsible for growing, producing, packing, and delivering the Products to Mastronardi, and Mastronardi is responsible for marketing, branding and distributing the Products to its customers. Mastronardi will pay the Company market prices for the Products that are consistent with the best and highest prices available during the duration of the applicable growing season for like kind U.S. Department of Agriculture Grade No. 1 products. Mastronardi will set the market price for the Products and will pay the Company the gross sale price of the Product sold by Mastronardi, less a marketing fee and Mastronardi’s costs incurred in the sale and distribution of the Products. If Mastronardi rejects, returns or otherwise refuses Products for failure to meet certain quality standards, the Company has the right, at its cost and expense, to sell or otherwise dispose of the Products, subject to certain conditions. The Mastronardi Morehead Agreement has a term of 10 years. The Company has a limited, one-time right to terminate the Mastronardi Morehead Agreement if certain return targets are not reached. During the term of the Mastronardi Morehead Agreement, Mastronardi has a right of first refusal to enter into similar arrangements with regard to any additional growing facilities the Company establishes in Kentucky or West Virginia. The Company recognizes revenue at a point in time and at the amount it expects to be entitled to be paid when its performance obligation is complete, which is generally when control of the Products is transferred to its customers upon pick-up by the customer or the customer’s agent from the Company’s facilities. Prices for the Company’s Products are based on agreed upon rates with customers and do not include financing components or noncash consideration. Revenue is recorded net of variable consideration, such as commissions and other shipping, handling and marketing costs incurred as defined in the customer agreements. Revenue is also recorded net of provisions for returns and rejections for Products that do not meet quality specifications, with such provisions calculated using historical averages adjusted for any expected changes due to current business conditions. Payment terms are generally 30 days. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The company categorizes its assets and liabilities into one of three levels based on the assumptions (inputs) used in determining their values, as defined below: • Level 1 : Unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2 : Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets that are not active; 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 : Unobservable inputs reflecting management’s assumptions about the inputs used in pricing the asset or liability. The table below presents the Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for each measurement: Fair Value as of March 31, 2021 (In thousands) Balance Sheet Account Level 1 Level 2 Level 3 Total Assets: Foreign currency options Other assets, net $ — $ 166 $ — $ 166 Total assets $ — $ 166 $ — $ 166 Liabilities: Foreign currency forward contracts Other current liabilities $ — $ 798 $ — $ 798 Private Warrants Private Warrant liabilities — 29,920 — 29,920 Total liabilities $ — $ 30,718 $ — $ 30,718 The Company’s condensed consolidated financial instruments include foreign currency forward and option contracts that are measured at fair value based on observable market transactions as of the reporting date. The fair values of the outstanding derivative instruments were measured using valuations based upon quoted prices for similar assets and liabilities in active markets (Level 2) and are valued by reference to similar financial instruments, adjusted for terms specific to the contracts. See Note 11. Derivative Financial Instruments for more information on the Company’s use of financial instruments. The Private Warrant liabilities are determined using a Black-Scholes option pricing model, a Level 2 valuation. The significant inputs to the Private Warrant valuation are as follows: On the Closing Date of the Business Combination March 31, 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 24.95 $ 18.30 Volatility 25.0 % 55.8 % Remaining term in years 5.00 4.83 Risk-free rate 0.45 % 0.92 % Dividend yield — — The following table summarizes the private warrant activity for the three months ended March 31, 2021: (In thousands) Fair value of Private Warrants on the Closing Date $ 45,565 Fair value of Private Warrants converted to Public Warrants (5,819) Change in fair value of Private Warrants (9,826) Fair value of Private Warrants outstanding as of March 31, 2021 $ 29,920 The Company did not have any assets or liabilities subject to fair value measurements on a recurring basis as of December 31, 2020. The Warrants are deemed equity instruments for income tax purposes, and accordingly, there is no tax accounting relating to changes in the fair value of the Private Warrants recognized. The changes in the fair value of the Private Warrants may be material to our future operating results. The Company measures certain assets and liabilities at fair value on a non-recurring basis. Assets and liabilities that are measured at fair value on a non-recurring basis include long-lived assets which would generally be recorded at fair value as a result of an impairment charge. Assets acquired and liabilities assumed as part of a business combination or asset acquisition are also measured at fair value on a non-recurring basis during the measurement period allowed by the accounting standards codification guidance for business combinations, when applicable. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are valued at the lower of cost (first-in, first-out) or net realizable value. Finished goods inventories represent costs associated with boxed produce not yet sold. Growing crop inventories primarily represent the costs associated with growing produce within the Company’s CEA facilities. Materials and supplies primarily represent growing and packaging supplies. Inventory costs are comprised of the purchase and transportation cost plus production labor and overhead. Inventories consisted of the following: March 31, 2021 December 31, 2020 Growing crops $ 3,275 $ 2,606 Raw materials 1,597 781 Finished goods 31 — Total inventories, net $ 4,903 $ 3,387 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment at cost and accumulated depreciation are as follows: March 31, 2021 December 31, 2020 Land $ 19,449 $ 7,277 Buildings 76,165 57,362 Machinery and equipment 43,357 9,581 Construction in progress 50,824 78,174 Leasehold improvements 2,320 871 Less: accumulated depreciation (1,153) (620) Total property and equipment, net $ 190,962 $ 152,645 Depreciation expense for the three months ended March 31, 2021 and 2020 was $1,772 and $21, respectively. During the three months ended March 31, 2021, the Company continued construction on the two additional CEA facilities in Berea, Kentucky and Richmond, Kentucky. The Company also acquired the Morehead CEA facility and related property from Equilibrium Controlled Environment Foods Fund, LLC and its affiliates (“Equilibrium”), a related party (See Note 10(a)). |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses Accrued expenses are as follow: March 31, 2021 December 31, 2020 Payroll and related $ 2,237 $ 563 Professional service fees 2,284 693 Construction costs 1,408 2,574 Other accrued liabilities 935 352 Incentive compensation 864 — Utilities 476 384 Interest on convertible debt with a related party — 618 Total accrued expenses $ 8,204 $ 5,184 |
Notes Payable with a Related Pa
Notes Payable with a Related Party | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable with a Related Party | Note Payable with a Related PartyOn September 28, 2020, the Company entered into a convertible promissory note with Inclusive Capital Partners Spring Master Fund, L.P., a related party, to finance capital investments and operating needs. The Convertible Note had a principal balance of $30,000 and interest at 8.0% per annum. The outstanding principal amount of the Convertible Note and unpaid accrued interest was extinguished at a conversion price equal to $9.50 per share upon the successful closing of the Business Combination. The note principal of $30,000 and accrued interest of $618 were included as current liabilities at December 31, 2020. In connection with the Business Combination on January 29, 2021, the outstanding principal and unpaid accrued interest due was converted into an aggregate 3,242 shares of the Company’s common stock, such that the Convertible Note was no longer outstanding and ceased to exist. |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies (a) Equilibrium Transaction On March 1, 2021, the Company closed on the Membership Interest Purchase and Sale Agreement (the “MIPSA”) with Equilibrium that was entered into in December 2020, pursuant to which it purchased from Equilibrium 100% of its membership interests in its subsidiary, Morehead Farm LLC. The purchase price for Morehead Farm LLC (“Morehead Farm”) was $125,000 which was equal to a multiple of Equilibrium’s cost to acquire, develop and construct the Morehead Facility. At closing, Morehead Farm LLC, which owns the Morehead facility, became a wholly owned subsidiary of the Company. Concurrent with the closing of the MIPSA the Master Lease Agreement that the Company had entered into on May 13, 2019 with Morehead Farm LLC to lease the Morehead facility and ancillary agreements related thereto, were terminated. As a result, the closing date balances of $66,504 for the financing obligation related to construction in progress assets and $58,496 for the finance lease liability related to the completed portion of the Morehead facility were settled and de-recognized from the Company’s unaudited condensed consolidated balance sheet. (b) Other Leases The Company’s other lease portfolio is primarily comprised of operating leases for offices. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on whether the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Leases are classified as operating or finance leases at the commencement date of the lease. Operating lease right-of-use assets, net and liabilities are recognized within the condensed consolidated balance sheets based on the present value of lease payments over the lease term. As the implicit rate is generally not readily determinable for most leases, the Company uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate reflects the estimated rate of interest that the Company would pay to borrow on a collateralized basis over a similar term in a similar economic environment. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Leases may include renewal options, and the renewal option is included in the lease term if the Company concludes that it is reasonably certain that the option will be exercised. A certain number of the Company’s leases contain rent escalation clauses, either fixed or adjusted periodically for inflation of market rates, that are factored into the calculation of lease payments to the extent they are fixed and determinable at lease inception. For the period ended March 31, 2021 and 2020 the Company recognized $97 and $14, respectively, of operating lease expense in selling, general and administrative expense (“SG&A”) within the unaudited condensed consolidated statement of operations and comprehensive loss. The future minimum rental payments required under the leases for each year of the next five years and in the aggregate thereafter are as follows: Operating leases Remainder of 2021 $ 319 2022 426 2023 415 2024 368 2025 355 2026 and thereafter 729 Total minimum payments required 2,612 Less: imputed interest costs (1) (462) Present value of net minimum lease payments (2) $ 2,150 Weighted-average imputed interest rate 6.32 % Weighted-average remaining lease term 6.3 ____________________________ (1) Represents the amount necessary to reduce net minimum lease payments to present value using actual rate in the lease agreement or the Company’s incremental borrowing rate at lease inception. (2) Included in the unaudited condensed consolidated balance sheet as of March 31, 2021 as current and non-current lease liability of $300 and $1,850, respectively. Period Ended March 31, 2021 2020 Cash paid for amounts included in the measurement of operating lease liabilities $ 52 $ 10 Operating lease right-of-use assets obtained in exchange for new operating lease liabilities $ 735 $ 30 (c) Agreements with Dalsem The Company entered into agreements with Dalsem Greenhouse Technology, B.V. (“Dalsem”) for the construction of new CEA facilities in Richmond, Kentucky and Berea, Kentucky on November 20, 2020 and December 11, 2020, respectively. Under terms of the agreements, Dalsem will provide certain services related to the design, engineering, procurement, construction, startup and testing of a greenhouse and certain ancillary facilities at each site. Total costs under the agreements are based on actual costs incurred by Dalsem and payments are due upon the completion of certain established project milestones, with a portion of each payment due in Euros and a portion due in U.S. dollars. Either party is entitled to terminate the agreements upon the occurrence of certain events of default and the Company is entitled to terminate the agreements if Dalsem fails to meet certain performance requirements. The Company may also terminate the agreements without cause with written notice and a termination payment to Dalsem. (d) Purchase Commitments There were no purchase commitments that were unrecorded at March 31, 2021 and December 31, 2020, respectively. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments During the three months ended March 31, 2021, the Company entered into foreign currency forward and option contracts to hedge certain cash flows related to anticipated expenditures related to the construction of its Berea, Kentucky and Richmond, Kentucky CEA facilities. These contracts, which have maturities ranging through December 2022, qualify as cash flow hedges and are used to hedge the Company’s foreign currency risk associated with the Euro denominated payments due upon the completion of established project milestones under the applicable CEA facility construction contracts. As of March 31, 2021, the total notional amount outstanding of foreign currency c ontracts designated as cash flow hedging instruments was €49,692. The Company maintains collateral of $5,000 for the hedge program which is included in other non-current assets and margin call deposits of $670 which are included in prepaid expenses and other current assets in the unaudited condensed consolidated balance sheet at March 31, 2021. The Company has elected to measure hedge effectiveness using the “spot method” under which the hedging relationship is considered perfectly effective and changes in the fair value of the forward and options contracts attributable to changes in the spot rate are recorded as a component of other AOCL. As the hedged items are ultimately capitalized as part of the CEA facility fixed assets, the AOCL amounts will be reclassified into earnings over the same periods as the future depreciation expense related to those assets. Consistent with the allocation of greenhouse facility fixed asset depreciation, the AOCL reclassification will also be allocated between cost of goods sold (“COGS”) and SG&A within the unaudited condensed consolidated statement of operations and comprehensive loss. Under the “spot method”, changes in the fair value of forward contracts attributable to changes in the difference between the forward rate and the spot rate (forward points) and the fair value of option contracts attributable to time and volatility values (up-front premium) will be excluded from the measure of hedge effectiveness and amortized as COGS and SG&A on a straight-line basis over the terms of the underlying contracts. During the three months ended March 31, 2021, the Company recognized amortization expense of $30 related to its foreign currency hedge contracts within its unaudited condensed consolidated statement of operations and comprehensive loss. |
Stock Compensation and Other Be
Stock Compensation and Other Benefit Plans | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock Compensation and Other Benefit Plans | Stock Compensation and Other Benefit Plans Equity Incentive Plan On January 29, 2021, stockholders approved the 2021 Equity Incentive Plan, (the “Plan”), replacing the 2018 Equity Incentive Plan, (the “2018 Plan”), pursuant to which the Company’s Board of Directors may grant stock awards, including stock options, stock appreciation rights, restricted stock awards, restricted stock units and other stock-based awards, to officers, key employees, and directors. The Plan allows for non-employee director grants, which are accounted for in the same manner as employee awards. Ther e are 10,027 registered shares of common stock reserved for issuance under the Plan. During the three months ended March 31, 2021, no awards were granted under the Plan. Ther e are 5,371 registered shares of common stock reserved for issuance upon exercise or settlement, as applicable, of awards made under the 2018 Plan. Wh ile no further awards may be granted under the 2018 Plan, that plan continues to govern all outstanding awards previously issued under it. Vesting of the restricted stock units issued under the 2018 Plan (“2018 RSUs”) was dependent on a liquidity event, the Business Combination, which occurred on January 29, 2021. Accordingly, the Company rec ognized a one-time stock-based compensation expense of $2,616 as of that date as a retroactive catch-up of cumulative stock-based compensation expense for such awards from their original grant dates. Total stock-based compensation expense related to 2018 RSU’s was $6,244 during the three months ended March 31, 2021. As of March 31, 2021, the Compan y had 1,830 gra nted but unvested 2018 RSU’s with unrecognized stock-based compensation expense of $17,111 remaining. Total stock-based compensation expense was $6,287 and $19 for the three months ended March 31, 2021 and 2020, respectively. Of these amounts, $6,027 and $19 were included in SG&A for the three months ended March 31, 2021 and 2020, respectively, and $260 and zero, respectively, in COGS for the three months ended March 31, 2021 and 2020, respectively, within the Company’s unaudited condensed consolidated statements of operations and comprehensive loss. Employee Stock Purchase Plan On January 29, 2021, stockholders approved the 2021 Employee Stock Purchase Plan, (the “ESPP”). The ESPP provides eligible employees with a means of acquiring equity in the Company at a discounted price using their own accumulated payroll deductions. Under the terms of the ESPP employees can elect to have amounts of their annual compensation withheld, up to a maximum set by the board, to purchase shares of Company common stock for a purchase price equal to 85% of the lower of the fair market value per share (at closing) of Company common stock on (i) the offering date or (ii) the respective purchase date. There are 2,005 shares of common stock reserved for issuance under the ESPP. During the three months ended March 31, 2021, there were no shares purchased under the ESPP. Employee Cash Incentive Plan On March 23, 2021, the Compensation Committee of the Board (the “Committee”) adopted an Employee Cash Incentive Plan (the “Cash Incentive Plan”) which will govern the terms of annual cash incentive awards granted to eligible employees of the Company, as determined by the Committee from time to time. The Company’s named executive officers are eligible to participate in the Cash Incentive Plan, except that Jonathan Webb, the Company’s Chief Executive Officer, is not eligible to participate for the 2021 performance period. The Committee (or its delegate) will administer the Cash Incentive Plan and will have the authority to determine all of the awards granted under the Cash Incentive Plan. The Cash Incentive Plan provides for a cash incentive award determined based on the achievement of specified annual Company performance goals, which include net revenue, adjusted EBITDA and improvement in the Company’s benefit corporation certification score, as well as individual performance goals. The performance measures for the Company’s named executive officers for the Company’s fiscal year ending December 31, 2021 will be described in the Company’s annual proxy statement filed in 2022. Each eligible employee will be assigned an individual incentive target expressed as a percentage of the employee’s annual base salary. Following the end of each annual performance period, the Committee will determine achievement of the Company and individual performance goals. The Committee may modify and/or adjust the performance goals or the related level of achievement, in whole or in part, as it deems appropriate or equitable. Any cash incentive awards that become payable under the Cash Incentive Plan will generally be paid no later than 90 days following the end of the applicable performance period. In order to receive an award under the Cash Incentive Plan, the participant must generally remain employed and in good standing with the Company through the date of payment. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure | Income TaxesThe Company’s effective income tax rate was (7.6)% and 0% for the three months ended March 31, 2021 and 2020, respectively. The variance from the U.S. federal statutory rate of 21% for the three months ended March 31, 2021 was primarily attributable to a change in the Company’s valuation allowance. The Company’s income tax provision is impacted by a valuation allowance on the Company’s net deferred tax assets, net of reversing taxable temporary differences and considering future annual limitations on net operating loss carryforward utilization enacted by U.S. tax reform legislation. The Company maintains a valuation allowance on its net deferred tax assets for all periods presented as the Company cannot be certain that future taxable income will be sufficient to realize its deferred tax assets. Valuation allowances are provided against deferred tax assets when, based on all available evidence, it is considered more likely than not that some portion or all the recorded deferred tax assets will not be realized in future periods. There was no income tax expense recognized in the three months ended March 31, 2020. |
Net Loss Per Common Share
Net Loss Per Common Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Common Share | Net Loss Per Common Share Diluted net loss per common share is the same as basic net loss per common share for all periods presented because the effects of potentially dilutive items were anti-dilutive given the Company’s net loss. The following common share equivalent securities have been excluded from the calculation of weighted-average common shares outstanding because the effect is anti-dilutive: Anti-dilutive common share equivalents March 31, 2021 March 31, 2020 Stock options 2,866 2,159 Restricted Stock Units 2,561 — Warrants 13,250 — Total anti-dilutive common share equivalents 18,677 2,159 Period Ended March 31, 2021 2020 Numerator: Net loss $ (28,515) $ (818) Denominator: Weighted-average common shares outstanding, basic and diluted 80,729 32,858 Net loss per common share, basic and diluted $ (0.35) $ (0.02) |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsIn April 2021, the Company acquired Root AI, Inc., (“Root AI”) an artificial intelligence farming startup that creates intelligent robots to help manage high-tech indoor farms, for approximately $60,000. Total consideration included $10,000 in cash and 2,328 shares of the Company’s common stock. Founded in 2018, Root AI is based in Somerville, Massachusetts and has 19 full-time employees. The acquisition of Root AI is expected to provide the Company with a baseline of harvesting support while helping to evaluate crop health, predict yield, and optimize overall operations of its CEA facilities. The acquisition of Root AI will be accounted for under the acquisition method. On April 12, 2021, the Company granted a total of 6,003 restricted stock units under the Plan |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial reporting and Securities and Exchange Commission regulations. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. |
Consolidation | The unaudited condensed consolidated financial statements include the accounts of the Company and its controlled subsidiaries. All significant intercompany accounts and transactions have been eliminated. |
Reclassification | Certain prior period balances have been reclassified to conform to the current period presentation in the unaudited condensed consolidated financial statements and the accompanying notes. |
Use of Estimates in Condensed Consolidated Financial Statements | In preparing the condensed consolidated financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Although these estimates are based on the Company’s knowledge of current events and actions the Company may undertake in the future, actual results could differ from those estimates and assumptions. Significant items subject to such estimates and assumptions include the recording of revenue, valuation of inventory, the valuation of stock-based compensation, the valuation of private warrants, lease accounting, the useful life of fixed assets and income taxes. The Company’s results can also be affected by economic, political, legislative, regulatory, legal actions, and the global volatility and general market disruption resulting from the global outbreak of the novel coronavirus disease (“COVID-19”). Economic conditions, such as recessionary trends, inflation, interest and monetary exchange rates, and government fiscal policies, can have a significant effect on operations. While the Company maintains reserves for anticipated liabilities and carries various levels of insurance, the Company could be affected by civil, criminal, environmental, regulatory or administrative actions, claims, or proceedings. |
Accounts Receivables | Accounts receivable consist of amounts due from customers in connection with our normal business activities and are carried at sales value less allowance for doubtful accounts. |
Allowance for Doubtful Accounts | The allowance for doubtful accounts is established to reflect the expected losses of accounts receivable based on past collection history, age, account payment status compared to invoice payment terms and specific individual risks identified. Write-offs are recorded against the allowance for doubtful accounts when all reasonable efforts for collection have been exhausted. |
Convertible Preferred Stock | Prior to the Business Combination, the Company recorded shares of redeemable convertible preferred stock at their respective fair values on the dates of issuance, net of issuance costs. The Company applied the guidance in Accounting Standards Codification (“ASC”) 480-10-S99-3A and therefore classified all of its outstanding redeemable convertible preferred stock as temporary equity. The redeemable convertible preferred stock was recorded outside of stockholders’ equity because, in the event of certain deemed liquidation events considered not solely within the Company’s control, such as a merger, acquisition and sale of all or substantially all of the Company’s assets, the preferred stock would become redeemable at the option of the holders. In the event of a change of control of the Company, proceeds received from the sale of such shares would be distributed in accordance with the liquidation preferences set forth in the Company’s Amended and Restated Certificate of Incorporation then in effect.All convertible preferred stock previously classified as temporary equity was retroactively adjusted and reclassified to permanent equity as a result of the Business Combination. As a result of the Business Combination, each share of redeemable convertible preferred stock that was then issued and outstanding was automatically converted into Legacy AppHarvest Common Stock, such that each converted share of preferred stock was no longer outstanding and ceased to exist. Each share of Legacy AppHarvest common stock, including the Legacy AppHarvest common stock issued upon conversion of Legacy AppHarvest preferred stock, was converted into and exchanged for 2.1504 (the “Exchange Ratio”) shares of the Company’s common stock.The Exchange Ratio was established pursuant to the terms of the Business Combination Agreement. |
Warrants | The Public Warrants were determined to be equity classified in accordance with U.S. GAAP. The Private Warrants are identical to the Public Warrants except that the Private Warrants and the shares of common stock issuable upon the exercise of the Private Warrants will not be transferable, assignable or salable until after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Warrants will be exercisable for cash or on a cashless basis, at the holder’s option, and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. As a result of the provisions in the warrant agreement that provide for differences in the mechanics of a cashless exercise dependent upon the characteristics of the warrant holder, and because the holder of a warrant is not an input into the pricing of a fixed-for-fixed option on equity shares, such provisions preclude the Private Warrant from being classified in equity. Accordingly, the Private Warrants are classified as a liability and remeasured at fair value at each reporting date. |
Derivative Financial Instruments | Derivative financial instruments are used to manage foreign currency exchange risks. The financial instruments used by the Company are straight-forward, non-leveraged instruments. The counterparties to these financial instruments are financial institutions with strong credit ratings. The Company maintains control over the size of positions entered into with any one counterparty and regularly monitors the credit ratings of these institutions. For all transactions designated as hedges, the hedging relationships are formally documented at the inception and on an ongoing basis in offsetting changes in cash flows of the hedged transaction.The Company records derivative financial instruments on the condensed consolidated balance sheets as either an asset or liability measured at its fair value. Changes in a derivative's fair value (i.e. unrealized gains or losses) are recorded each period in earnings unless the derivative qualifies as a hedge on future cash flows. Gains and losses related to a hedge are either recognized in income immediately to offset the gain or loss on the hedged item, or deferred and recorded in the stockholders' equity section of the condensed consolidated balance sheets as a component of accumulated other comprehensive loss (“AOCL”) and subsequently recognized in the condensed consolidated statements of operations and comprehensive loss when the hedged item affects net income. The ineffective portion of the change in fair value of a hedge, if any, is recognized in income immediately. For derivative instruments that are not designated as hedges, the gain or loss related to the change in fair value is also recorded to net income immediately. |
New Accounting Pronouncements | In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 is part of the FASB’s overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. ASU 2019-12 removes certain exceptions to the general principles of ASC 740, Income Taxes, in order to reduce the cost and complexity of its application in the areas of intraperiod tax allocation, deferred tax liabilities related to outside basis differences, year-to-date losses in interim periods and other areas within ASC 740. The Company adopted ASU 2019-12 on January 1, 2021 and the adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements. |
Fair Value Measurements | The company categorizes its assets and liabilities into one of three levels based on the assumptions (inputs) used in determining their values, as defined below: • Level 1 : Unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2 : Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets that are not active; 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 : Unobservable inputs reflecting management’s assumptions about the inputs used in pricing the asset or liability. |
Business Combination (Tables)
Business Combination (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Reverse Recapitalization [Abstract] | |
Schedule of Reconciliation of the elements of the Business Combination | The following table reconciles the elements of the Business Combination to the unaudited condensed consolidated statements of stockholders’ equity and cash flows for the three months ended March 31, 2021: Recapitalization Cash - Novus trust and cash, net of redemptions $ 99,896 Cash - PIPE financing 375,000 Non-cash Convertible Note conversion 30,808 Non-cash net liabilities assumed from Novus (2,850) Less: Fair value of assumed common stock Private Warrants (45,565) Less: transaction costs allocated to equity (23,762) Net impact on total stockholders’ equity 433,527 Less: cash payments for transaction costs at Closing (2,634) Less: non-cash Convertible Note conversion (30,808) Add: non-cash net liabilities assumed from Novus 2,850 Add: non-cash fair value of assumed common stock Private Warrants 45,565 Net impact on net cash provided by financing activities 448,500 Less: transaction costs included in net cash used in operating activities (a) (13,261) Total net increase in cash and cash equivalents $ 435,239 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Subject to Fair Value Measurements on a Recurring Basis | The table below presents the Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for each measurement: Fair Value as of March 31, 2021 (In thousands) Balance Sheet Account Level 1 Level 2 Level 3 Total Assets: Foreign currency options Other assets, net $ — $ 166 $ — $ 166 Total assets $ — $ 166 $ — $ 166 Liabilities: Foreign currency forward contracts Other current liabilities $ — $ 798 $ — $ 798 Private Warrants Private Warrant liabilities — 29,920 — 29,920 Total liabilities $ — $ 30,718 $ — $ 30,718 |
Fair Value Measurement Inputs and Valuation Techniques | The Private Warrant liabilities are determined using a Black-Scholes option pricing model, a Level 2 valuation. The significant inputs to the Private Warrant valuation are as follows: On the Closing Date of the Business Combination March 31, 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 24.95 $ 18.30 Volatility 25.0 % 55.8 % Remaining term in years 5.00 4.83 Risk-free rate 0.45 % 0.92 % Dividend yield — — |
Summary of Private Warrant Activity | The following table summarizes the private warrant activity for the three months ended March 31, 2021: (In thousands) Fair value of Private Warrants on the Closing Date $ 45,565 Fair value of Private Warrants converted to Public Warrants (5,819) Change in fair value of Private Warrants (9,826) Fair value of Private Warrants outstanding as of March 31, 2021 $ 29,920 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Net | Inventories consisted of the following: March 31, 2021 December 31, 2020 Growing crops $ 3,275 $ 2,606 Raw materials 1,597 781 Finished goods 31 — Total inventories, net $ 4,903 $ 3,387 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property and equipment at cost and accumulated depreciation are as follows: March 31, 2021 December 31, 2020 Land $ 19,449 $ 7,277 Buildings 76,165 57,362 Machinery and equipment 43,357 9,581 Construction in progress 50,824 78,174 Leasehold improvements 2,320 871 Less: accumulated depreciation (1,153) (620) Total property and equipment, net $ 190,962 $ 152,645 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses are as follow: March 31, 2021 December 31, 2020 Payroll and related $ 2,237 $ 563 Professional service fees 2,284 693 Construction costs 1,408 2,574 Other accrued liabilities 935 352 Incentive compensation 864 — Utilities 476 384 Interest on convertible debt with a related party — 618 Total accrued expenses $ 8,204 $ 5,184 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Operating Lease Liability by Maturity | Period Ended March 31, 2021 2020 Cash paid for amounts included in the measurement of operating lease liabilities $ 52 $ 10 Operating lease right-of-use assets obtained in exchange for new operating lease liabilities $ 735 $ 30 |
Summary of Lease Cost | Period Ended March 31, 2021 2020 Cash paid for amounts included in the measurement of operating lease liabilities $ 52 $ 10 Operating lease right-of-use assets obtained in exchange for new operating lease liabilities $ 735 $ 30 |
Net Loss Per Common Share (Tabl
Net Loss Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following common share equivalent securities have been excluded from the calculation of weighted-average common shares outstanding because the effect is anti-dilutive: Anti-dilutive common share equivalents March 31, 2021 March 31, 2020 Stock options 2,866 2,159 Restricted Stock Units 2,561 — Warrants 13,250 — Total anti-dilutive common share equivalents 18,677 2,159 |
Schedule of Earnings Per Share, Basic and Diluted | Period Ended March 31, 2021 2020 Numerator: Net loss $ (28,515) $ (818) Denominator: Weighted-average common shares outstanding, basic and diluted 80,729 32,858 Net loss per common share, basic and diluted $ (0.35) $ (0.02) |
Description of Business (Detail
Description of Business (Details) | 3 Months Ended |
Mar. 31, 2021facility | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of facilities under construction | 2 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2021USD ($)day$ / sharesshares | Mar. 31, 2020USD ($) | Jan. 29, 2021 | Jan. 28, 2021shares | |
Class of Warrant or Right [Line Items] | ||||
Exchange ratio | 2.1504 | |||
Issuance of preferred stock, net | $ | $ 0 | $ 4,880 | ||
Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants outstanding (in shares) | 13,250,000 | |||
Exercise price of warrants (in dollars per share) | $ / shares | $ 11.50 | |||
Warrants | Common Stock | ||||
Class of Warrant or Right [Line Items] | ||||
Number of shares called by each warrant (in shares) | 1 | |||
Public Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants outstanding (in shares) | 10,500,000 | 10,000,000 | ||
Redemption price (in dollars per share) | $ / shares | $ 0.01 | |||
Minimum notice of redemption, term | 30 days | |||
Common stock price threshold which triggers warrant redemption (in dollars per share) | $ / shares | $ 18.50 | |||
Consecutive trading days threshold (in days) | day | 20 | |||
Trading day threshold (in days) | day | 30 | |||
Private Warrants | ||||
Class of Warrant or Right [Line Items] | ||||
Warrants outstanding (in shares) | 2,750,000 | 3,250,000 |
Business Combination (Details)
Business Combination (Details) $ / shares in Units, $ in Thousands | Jan. 29, 2021USD ($)$ / sharesshares | Mar. 31, 2021$ / sharesshares | Jan. 28, 2021shares | Dec. 31, 2020$ / sharesshares |
Reverse Recapitalization [Line Items] | ||||
Exchange ratio | 2.1504 | |||
Capital stock, shares authorized (in shares) | 760,000,000 | |||
Common stock, shares authorized (in shares) | 750,000,000 | 750,000,000 | 750,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Number of shares issued (PIPE shares) | 37,500,000 | |||
Share price (in dollars per share) | $ / shares | $ 10 | |||
Aggregate purchase price in private placement | $ | $ 375,000 | |||
Increase in cash and cash equivalents as a result of the Business Combination | $ | 435,239 | |||
Gross proceeds from the PIPE | $ | $ 375,000 | |||
Common Stock | Convertible Debt | ||||
Reverse Recapitalization [Line Items] | ||||
Shares issued upon conversion (in shares) | 3,242,000 | |||
Public Warrants | ||||
Reverse Recapitalization [Line Items] | ||||
Warrants outstanding (in shares) | 10,500,000 | 10,000,000 | ||
Private Warrants | ||||
Reverse Recapitalization [Line Items] | ||||
Warrants outstanding (in shares) | 2,750,000 | 3,250,000 |
Business Combination - Reconcil
Business Combination - Reconciliation of the Business Combination (Details) - USD ($) $ in Thousands | Jan. 29, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Schedule of Reverse Recapitalization [Line Items] | |||
Cash - Novus trust and cash, net of redemptions | $ 99,896 | ||
Cash - PIPE financing | 375,000 | ||
Non-cash Convertible Note conversion | 30,808 | ||
Non-cash net liabilities assumed from Novus | (2,850) | ||
Less: Fair value of assumed common stock Private Warrants | (45,565) | ||
Less: transaction costs allocated to equity | (23,762) | ||
Net impact on total stockholders’ equity | 433,527 | $ 448,500 | $ 0 |
Less: cash payments for transaction costs at Closing | (2,634) | ||
Less: non-cash Convertible Note conversion | (30,808) | ||
Add: non-cash net liabilities assumed from Novus | 2,850 | ||
Add: non-cash fair value of assumed common stock Private Warrants | 45,565 | ||
Net impact on net cash provided by financing activities | 448,500 | ||
Less: transaction costs included in net cash used in operating activities | (13,261) | ||
Total net increase in cash and cash equivalents | $ 435,239 | ||
Private Warrants | |||
Schedule of Reverse Recapitalization [Line Items] | |||
Transaction costs recognized as operating expense | $ 2,887 |
Revenue Recognition (Details)
Revenue Recognition (Details) | Mar. 28, 2019 |
Revenue from Contract with Customer [Abstract] | |
Term of contract | 10 years |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Jan. 29, 2021 |
Liabilities: | ||
Private Warrants | $ 29,920 | $ 45,565 |
Fair Value, Recurring | ||
Assets: | ||
Foreign currency options | 166 | |
Total assets | 166 | |
Liabilities: | ||
Foreign currency forward contracts | 798 | |
Total liabilities | 30,718 | |
Level 1 | Fair Value, Recurring | ||
Assets: | ||
Foreign currency options | 0 | |
Total assets | 0 | |
Liabilities: | ||
Foreign currency forward contracts | 0 | |
Private Warrants | 0 | |
Total liabilities | 0 | |
Level 2 | Fair Value, Recurring | ||
Assets: | ||
Foreign currency options | 166 | |
Total assets | 166 | |
Liabilities: | ||
Foreign currency forward contracts | 798 | |
Private Warrants | 29,920 | |
Total liabilities | 30,718 | |
Level 3 | Fair Value, Recurring | ||
Assets: | ||
Foreign currency options | 0 | |
Total assets | 0 | |
Liabilities: | ||
Foreign currency forward contracts | 0 | |
Private Warrants | 0 | |
Total liabilities | $ 0 |
Fair Value Measurements - Signi
Fair Value Measurements - Significant Inputs to the Private Warrant Valuation (Details) | Mar. 31, 2021$ / sharesyr | Jan. 29, 2021$ / sharesyr |
Exercise price | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 11.50 | 11.50 |
Stock price | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 18.30 | 24.95 |
Volatility | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.558 | 0.250 |
Remaining term in years | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | yr | 4.83 | 5 |
Risk-free rate | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0.0092 | 0.0045 |
Dividend yield | ||
Class of Warrant or Right [Line Items] | ||
Warrant liability, measurement input | 0 | 0 |
Fair Value Measurements - Priva
Fair Value Measurements - Private Warrant Activity (Details) - USD ($) $ in Thousands | 2 Months Ended | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Jan. 29, 2021 | |
Increase (Decrease) In Fair Value Of Warrants [Roll Forward] | ||||
Fair value of Private Warrants, beginning | $ 45,565 | |||
Fair value of Private Warrants converted to Public Warrants | $ (5,819) | |||
Change in fair value of Private Warrants | (9,826) | $ (9,826) | $ 0 | |
Fair value of Private Warrants, ending | $ 29,920 | $ 29,920 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Growing crops | $ 3,275 | $ 2,606 |
Raw materials | 1,597 | 781 |
Finished goods | 31 | 0 |
Total inventories, net | $ 4,903 | $ 3,387 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated depreciation | $ (1,153) | $ (620) |
Total property and equipment, net | 190,962 | 152,645 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 19,449 | 7,277 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 76,165 | 57,362 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 43,357 | 9,581 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 50,824 | 78,174 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,320 | $ 871 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) $ in Thousands | Mar. 01, 2021USD ($) | Mar. 31, 2021USD ($)facility | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) |
Property, Plant and Equipment [Line Items] | ||||
Depreciation | $ 1,772 | $ 21 | ||
Number of facilities under construction | facility | 2 | |||
Purchase price of Morehead CEA facility | $ 125,000 | |||
Buildings | ||||
Property, Plant and Equipment [Line Items] | ||||
Right-to-use assets under finance lease related to Morehead CEA facility | $ 56,748 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Payroll and related | $ 2,237 | $ 563 |
Professional service fees | 2,284 | 693 |
Construction costs | 1,408 | 2,574 |
Other accrued liabilities | 935 | 352 |
Incentive compensation | 864 | 0 |
Utilities | 476 | 384 |
Interest on convertible debt with a related party | 0 | 618 |
Accrued expenses | $ 8,204 | $ 5,184 |
Notes Payable with a Related _2
Notes Payable with a Related Party (Details) - USD ($) $ / shares in Units, shares in Thousands | Jan. 29, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 28, 2020 |
Debt Instrument [Line Items] | ||||
Interest on convertible debt with a related party | $ 0 | $ 618,000 | ||
Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 30,000,000 | |||
Interest on convertible debt with a related party | $ 618,000 | |||
Convertible Debt | Inclusive Capital Partners Spring Master Fund, L.P. | ||||
Debt Instrument [Line Items] | ||||
Principal amount | $ 30,000,000 | |||
Interest rate | 8.00% | |||
Conversion price (in dollars per share) | $ 9.50 | |||
Convertible Debt | Common Stock | ||||
Debt Instrument [Line Items] | ||||
Shares issued upon conversion (in shares) | 3,242 |
Commitment and Contingencies -
Commitment and Contingencies - Additional Information (Details) $ in Thousands | Mar. 01, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Interests acquired | 100.00% |
Purchase price of Morehead CEA facility | $ 125,000 |
Financing obligation related to construction in progress assets | 66,504 |
Finance lease liability | $ 58,496 |
Commitment and Contingencies _2
Commitment and Contingencies - Operating Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Operating lease expense | $ 97 | $ 14 | |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
Remainder of 2021 | 319 | ||
2022 | 426 | ||
2023 | 415 | ||
2024 | 368 | ||
2025 | 355 | ||
2026 and thereafter | 729 | ||
Total minimum payments required | 2,612 | ||
Less: imputed interest costs | (462) | ||
Present value of net minimum lease payments | $ 2,150 | ||
Weighted-average imputed interest rate | 6.32% | ||
Weighted-average remaining lease term | 6 years 3 months 18 days | ||
Current portion of lease liabilities | $ 300 | $ 166 | |
Lease liabilities, net of current portion | 1,850 | $ 1,370 | |
Cash paid for amounts included in the measurement of operating lease liabilities | 52 | 10 | |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 735 | $ 30 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Details) € in Thousands | 3 Months Ended | ||
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Mar. 31, 2021EUR (€) | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Amortization expense related to foreign currency hedge contracts | $ 30,000 | ||
Net unrealized loss on cash flow hedges, net of tax | 669,000 | $ 0 | |
Net unrealized loss on cash flow hedges, tax impact | 244,000 | ||
Foreign Currency Contract | Cash Flow Hedging | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | € | € 49,692 | ||
Derivative collateral | 5,000,000 | ||
Margin call deposits | 670,000 | ||
Net derivative liability | $ (632,000) |
Stock Compensation and Other _2
Stock Compensation and Other Benefit Plans (Details) - USD ($) $ in Thousands | Jan. 29, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 6,287 | $ 19 | |
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance (in shares) | 2,005,000 | ||
Purchase price of common stock, percent | 85.00% | ||
The 2021 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance (in shares) | 10,027,000 | ||
The 2018 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance (in shares) | 5,371,000 | ||
Share-based compensation expense | $ 2,616 | ||
The 2018 Plan | Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 6,244 | ||
Number of shares granted | 1,830 | ||
Unrecognized stock-based compensation expense | $ 17,111 | ||
SG&A | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 6,027 | 19 | |
COGS | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 260 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Effective income tax rate | 0.00% |
Net Loss Per Common Share - Ant
Net Loss Per Common Share - Anti-dilutive Common Share Equivalents (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common share equivalents | 18,677 | 2,159 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common share equivalents | 2,866 | 2,159 |
Restricted Stock Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common share equivalents | 2,561 | 0 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common share equivalents | 13,250 | 0 |
Net Loss Per Common Share (Deta
Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net loss | $ (28,515) | $ (818) |
Denominator: | ||
Weighted-average common shares outstanding, basic (in shares) | 80,729,000 | 32,858,000 |
Weighted-average common shares outstanding, diluted (in shares) | 80,729,000 | 32,858,000 |
Net loss per common share, basic (in dollars per share) | $ (0.35) | $ (0.02) |
Net loss per common share, diluted (in dollars per share) | $ (0.35) | $ (0.02) |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event $ in Millions | Apr. 12, 2021shares | Apr. 30, 2021USD ($)employeeshares |
Restricted Stock Units | The 2021 Plan | ||
Subsequent Event [Line Items] | ||
Number of shares granted | shares | 6,003,000 | |
Root AI | ||
Subsequent Event [Line Items] | ||
Number of employees | employee | 19 | |
Root AI | ||
Subsequent Event [Line Items] | ||
Business combination, consideration transferred | $ | $ 60 | |
Cash payment to acquire business | $ | $ 10 | |
Shares issued to acquire business (in shares) | shares | 2,328,000 |