Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2022 | |
Document and Entity Information [Abstract] | |
Document Type | POS AM |
Entity Registrant Name | Tempo Automation Holdings, Inc. |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | true |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Central Index Key | 0001813658 |
Amendment Flag | true |
Amendment Description | Amendment No. 2 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 7,113 | $ 2,864 |
Accounts receivable, net | 2,633 | 2,918 |
Inventory | 2,578 | 879 |
Contract assets | 233 | 1,219 |
Prepaid expenses and other current assets | 744 | 892 |
Total current assets | 13,301 | 8,772 |
Property and equipment, net | 6,514 | 8,891 |
Operating leases - right of use asset | 371 | 1,323 |
Restricted cash | 320 | 320 |
Other noncurrent assets | 83 | 2,925 |
Total assets | 20,589 | 22,231 |
Current liabilities | ||
Accounts payable | 10,165 | 1,583 |
Contract liabilities | 2,595 | 175 |
Accrued liabilities | 7,209 | 3,971 |
Accrued compensation and related benefits | 689 | 1,249 |
Operating lease liability, current | 516 | 1,111 |
Finance lease, current | 1,606 | 1,091 |
Loan payable - related party, current | 600 | |
Loan payable, current ($20,101 and $0 measured at fair value, respectively) | 20,977 | 10,486 |
Total current liabilities | 44,357 | 19,666 |
Operating lease liability, noncurrent | 30 | 546 |
Finance lease, noncurrent | 1,606 | |
Loan payable, noncurrent | 663 | 11,351 |
Warrant liabilities | 389 | 5,573 |
Earnout liabilities | 1,173 | |
Total liabilities | 46,612 | 38,742 |
Commitment and contingencies | ||
Stockholders' deficit | ||
Preferred stock, $0.0001 par value. 20,000,000 shares authorized at December 31, 2022 and 2021, respectively; no shares issued and outstanding at December 31, 2022 and 2021, respectively | ||
Common stock, $0.0001 par value. 600,000,000 shares authorized at December 31, 2022 and 2021, respectively; 26,329,195 and 6,745,554 shares issued and outstanding at December 31, 2022 and 2021, respectively | 3 | 1 |
Additional paid in capital | 227,137 | 91,800 |
Accumulated deficit | (253,163) | (108,312) |
Total stockholders' deficit | (26,023) | (16,511) |
Total liabilities and stockholders' deficit | $ 20,589 | $ 22,231 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Loan payable, current | $ 20,977 | $ 10,486 |
Preferred stock, par value per share | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock, shares issued | 26,329,195 | 6,745,554 |
Common stock, shares outstanding | 26,329,195 | 6,745,554 |
Loans payable, measured at fair value | ||
Loan payable, current | $ 20,101 | $ 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenue | $ 12,049 | $ 17,361 |
Cost of revenue | 10,736 | 14,578 |
Gross profit | 1,313 | 2,783 |
Operating expenses | ||
Research and development | 10,803 | 9,904 |
Sales and marketing | 8,265 | 9,817 |
General and administrative | 29,487 | 16,376 |
Impairment loss | 297 | |
Total operating expenses | 48,852 | 36,097 |
Loss from operations | (47,539) | (33,314) |
Other income (expense), net | ||
Interest expense | (8,095) | (3,686) |
Other financing cost | (30,793) | (8,955) |
Interest income | 20 | 3 |
Loss on debt extinguishment | (52,276) | (319) |
Other income (expense) | (4) | 2,500 |
Change in fair value of warrant and derivatives | 453 | (4,242) |
Change in fair value of debt | (10,766) | |
Change in fair value of earnout liabilities | 4,149 | |
Total other income (expense), net | (97,312) | (14,699) |
Loss before income taxes | (144,851) | (48,013) |
Net loss | $ (144,851) | $ (48,013) |
Net loss attributable per share to common stockholders, basic | $ (16.38) | $ (7.16) |
Net loss attributable per share to common stockholders, diluted | $ (16.38) | $ (7.16) |
Weighted-average shares used to compute net loss attributable per share to common stockholders, basic | 8,843,703 | 6,708,466 |
Weighted-average shares used to compute net loss attributable per share to common stockholders, diluted | 8,843,703 | 6,708,466 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT - USD ($) $ in Thousands | Previously reported Common Stock | Previously reported Additional Paid-in Capital | Previously reported Accumulated Deficit | Previously reported | Retrospective application of recapitalization Common Stock | Retrospective application of recapitalization Additional Paid-in Capital | Retrospective application of recapitalization | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at beginning of period at Dec. 31, 2020 | $ 0 | $ 4,285 | $ (60,299) | $ (56,014) | $ 1 | $ 75,683 | $ 75,684 | $ 1 | $ 79,968 | $ (60,299) | $ 19,670 |
Balance at beginning of period, shares at Dec. 31, 2020 | 9,773,097 | (3,072,597) | 6,700,500 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss | $ 0 | (48,013) | (48,013) | ||||||||
Issuance of common stock upon exercise of stock options | $ 0 | 126 | 126 | ||||||||
Issuance of common stock upon exercise of stock options, shares | 45,054 | ||||||||||
Issuance of common stock warrants | $ 0 | 9,168 | 9,168 | ||||||||
Stock-based compensation | 0 | 2,538 | 2,538 | ||||||||
Balance at end of period at Dec. 31, 2021 | $ 16,117 | $ (108,312) | (92,195) | $ 1 | $ 75,683 | 75,684 | $ 1 | 91,800 | (108,312) | (16,511) | |
Balance at end of period, shares at Dec. 31, 2021 | 10,037,305 | (3,291,751) | 6,745,554 | ||||||||
Balance at beginning of period at Dec. 31, 2020 | $ 75,684 | $ (75,684) | |||||||||
Balance at beginning of period, shares at Dec. 31, 2020 | 29,520,187 | (29,520,187) | |||||||||
Balance at end of period at Dec. 31, 2021 | $ 75,684 | $ (75,684) | |||||||||
Balance at end of period, shares at Dec. 31, 2021 | 29,520,187 | (29,520,187) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss | (144,851) | (144,851) | |||||||||
Issuance of common stock upon exercise of stock options | 49 | $ 49 | |||||||||
Issuance of common stock upon exercise of stock options, shares | 8,184 | 8,184 | |||||||||
Conversion of convertible notes into common stock | $ 1 | 62,909 | $ 62,910 | ||||||||
Conversion of convertible notes into common stock (in shares) | 6,003,020 | ||||||||||
Issuance of common stock upon net exercise of warrants (in shares) | 3,679,148 | ||||||||||
Merger and PIPE financing | $ 1 | 4,318 | $ 4,319 | ||||||||
Merger and PIPE financing (In shares) | 8,073,289 | 6,606,572 | |||||||||
Shares issued to lender upon debt extinguishment | 19,074 | $ 19,074 | |||||||||
Shares issued to lender upon debt extinguishment (in shares) | 1,820,000 | ||||||||||
Issuance of common stock warrants | 38,389 | 38,389 | |||||||||
Stock-based compensation | 10,598 | 10,598 | |||||||||
Balance at end of period at Dec. 31, 2022 | $ 3 | $ 227,137 | $ (253,163) | $ (26,023) | |||||||
Balance at end of period, shares at Dec. 31, 2022 | 26,329,195 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | ||
Net loss | $ (144,851) | $ (48,013) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation and amortization | 7,229 | 3,770 |
Stock-based compensation | 11,289 | 2,538 |
Noncash other financing cost | 30,793 | 8,955 |
Impairment loss | 297 | |
Loss on debt extinguishment | 51,903 | 319 |
Loss on disposal of property and equipment | 4 | |
Noncash operating lease expense | 824 | 786 |
Bad debt expense | 19 | 91 |
Change in fair value of warrant and derivatives | (453) | 4,242 |
Change in fair value of debt | 10,516 | |
Change in fair value of earnout liabilities | (4,149) | |
Gain on PPP loan forgiveness | (2,500) | |
Changes in operating assets and liabilities: | ||
Accounts receivable | 266 | (297) |
Contract assets | 986 | (611) |
Inventory | (1,699) | (711) |
Prepaid expenses and other current assets | (412) | (633) |
Other noncurrent assets | 4,119 | (1,817) |
Accounts payable | 1,743 | 1,109 |
Contract liabilities | 2,420 | 95 |
Accrued liabilities | 874 | 3,681 |
Loan payable - related party, current | 600 | |
Other noncurrent liabilities | (245) | |
Operating lease liabilities | (1,111) | (987) |
Net cash used in operating activities | (28,793) | (30,228) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (34) | (622) |
Net cash used in investing activities | (34) | (622) |
Cash flows from financing activities: | ||
Principal payments under finance lease obligations | (1,091) | (906) |
Proceeds from issuance of debt | 10,000 | 33,000 |
Proceeds from issuance of debt - related party | 10,637 | |
Payment of debt issuance costs | (111) | (765) |
Debt repayment | (3,835) | (14,998) |
Proceeds from exercise of stock options | 49 | 126 |
Proceeds from Merger and PIPE financing | 18,704 | |
Payment of deferred transaction costs | (1,277) | (169) |
Net cash provided by financing activities | 33,076 | 16,288 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 4,249 | (14,562) |
Cash, cash equivalents and restricted cash at beginning of year | 3,184 | 17,746 |
Cash, cash equivalents and restricted cash at end of year | 7,433 | 3,184 |
Supplemental disclosures of cash flow information | ||
Cash paid for income taxes | 10 | 7 |
Cash paid for interest | 6,145 | 2,446 |
Noncash investing and financing activities | ||
Issuance of common stock warrants | 9,168 | |
Recognition of liability classified warrants upon Merger | 1,122 | |
Shares issued to lender upon LSA Term Loan extinguishment | 19,074 | |
Conversion of convertible notes into common stock | 62,910 | |
Initial recognition of Tempo Earnout | 5,322 | |
Issuance of common stock upon net exercise of warrants | 38,389 | |
Unpaid transaction costs | 1,757 | |
Forgiveness of PPP loan | 2,500 | |
Carrying value of extinguished debt | 69,500 | 6,000 |
Refinanced debt | $ 62,997 | $ 6,000 |
Description of Business and Bus
Description of Business and Business Combination | 12 Months Ended |
Dec. 31, 2022 | |
Description of Business and Business Combination | |
Description of Business and Business Combination | (1) Description of Business and Business Combination Description of Business Tempo Automation Holdings, Inc. (the “Company,” “Tempo,” “us,” “our” or “we”) is a Printed Circuit Board Assembly (“PCBA”) manufacturing company that was incorporated in Delaware in 2022. Prior to the Merger (as defined below), the Company operated as Tempo Automation, Inc. (“Legacy Tempo”). Tempo provides turnkey PCBA services for low volume production and the Company’s proprietary automation software is intended to provide transparent production and delivery tracking with live updates through an unbroken digital thread from design to delivery. The Company provides real-time lead times based on supplier inventory and factory workload. Merger with ACE Convergence Acquisition Corp. On November 22, 2022, ACE Convergence Acquisition Corp. (“ACE”) and its subsidiary, ACE Convergence Subsidiary Corp, acquired Legacy Tempo via a series of mergers, whereby Legacy Tempo merged into ACE Convergence Subsidiary Corp, and became a wholly owned subsidiary of ACE (the “Merger”). ACE was renamed Tempo Automation Holdings, Inc (also referred to herein as “New Tempo”). Prior to the Merger, ACE Convergence Acquisition LLC was the sponsor of ACE (the “Sponsor”) and with the close of the Merger either ACE Convergence Acquisition LLC or affiliated entities, remained a significant shareholder in the Company. Trust Proceeds and PIPE investment At the closing date of the Merger, $23.4 million of unredeemed funds were released to ACE from the Trust and accordingly 2,269,299 shares associated with the Trust remained from such holders within New Tempo. In connection with the execution of the Merger, New Tempo received proceeds from a number of investors (the “PIPE Investors”), pursuant to the Third Amended and Restated Subscription Agreement, whereby such investors agreed to purchase an aggregate of 550,000 shares of common stock (the “Committed PIPE Shares”), for an aggregate purchase price of $5.5 million, in a private placement pursuant to the subscription agreements (the “PIPE”). Of the $5.5 million, New Tempo received a cash inflow of $3.5 million and an existing investor holding $2.0 million in the Trust agreed to participate in the PIPE investment, exchanging its shares in Trust for PIPE shares. Pursuant to the PIPE subscription agreement, an additional 2,000,000 shares (the “Incentive PIPE Shares”) were issued to the PIPE Investors (including to the LSA PIPE Investors, as discussed below) on a pro-rata basis as an incentive to purchase the shares under the Third Amended and Restated PIPE Subscription Agreement. The funding from the PIPE Investors closed immediately prior to the closing of the Merger. In addition to the Committed PIPE Shares and Incentive PIPE Shares issued at the closing of the PIPE investment, New Tempo agreed that the newly merged entity would: ● issue additional shares of common stock to each PIPE Investor (the “Additional Shares”) in the event that the volume weighted average price per share (“Adjustment Period VWAP”) of New Tempo common stock during the 30 days commencing on the date on which a registration statement registering the resale of the shares of New Tempo common stock acquired by such PIPE Investors is declared effective is less than $10.00 per share. ● transfer the PIPE subscribers (to the extent such subscribers committed shares are still outstanding) up to an additional 1,000,000 shares (“Additional Period Shares”) in the event that during the additional period the volume weighted average price per share (“Additional Period VWAP”) is less than the Adjustment Period WVAP during the fifteen month period following closing of the Merger. Due to the number of PIPE Incentive Shares issued at closing, pursuant to the PIPE subscription agreement no Additional Shares will be issued by New Tempo to any PIPE investor. For the Additional Period Shares which remain subject to issuance, the Company determined that these represent equity linked financial instruments that are liability classified and measured at fair value at each reporting date. At closing of the Merger, the liability associated with such additional period shares was immaterial. The Company remeasured the liability at December 31, 2022, recording Upon consummation of the Merger, Tempo received approximately $18.7 million from the Trust and PIPE, net of transaction costs and other payments as set forth as follows (in thousands): Recapitalization Cash-ACE Trust $ 23,391 Cash-PIPE investment 3,500 Less: transaction costs and other payments (1)(2) (8,187) Net cash proceeds from Merger 18,704 Less: Earnout liability (5,322) Less: Warrants assumed (1,122) Less: Debt assumed – related party (600) Less: ACE transaction costs – unpaid (1) (7,342) Merger and PIPE Financing $ 4,318 (1) Amount reflects payment of the following amounts utilizing the proceeds released from the Trust (a) the repayment of $2.1 million of ACE related party loans, (b) the payment of During the period from the Merger date to December 31, 2022, the Company paid $0.5 million of ACE’s transaction costs and other payments, included in the amount above, and as of December 31, 2022, $7.3 million of ACE transaction costs remained unpaid. (2) Excludes the payment of $3.3 million as part of the LSA amendment and any Legacy Tempo transaction costs relating to the Merger Transaction. Upon receiving the $18.7 million of proceeds from Trust, the Company paid $1.4 million in Legacy Tempo legal fees and $0.5 million in fees to certain capital markets advisors, both of such amounts were expensed by the Company. At the time of Merger, the Company made the determination to expense all Legacy Tempo transaction costs. For the years ended December 31, 2022 and 2021, the Company expensed $8.6 million and $0.1 million, respectively, within general administrative expenses on the consolidated statement of operations. As of December 31, 2021, the Company had deferred such costs amounting to $1.9 million, which are included in other noncurrent assets in the consolidated balance sheets. As of December 31, 2022 and 2021, $5.2 million and $1.8 million of transaction costs remained unpaid. Legacy Tempo Convertible Promissory Notes and Equity and the Exchange Immediately prior to the closing of the Merger, all convertible promissory notes converted into Legacy Tempo common stock, all shares of outstanding redeemable convertible preferred stock of Legacy Tempo were automatically converted into shares of Legacy Tempo common stock, and substantially all outstanding warrants for Legacy Tempo shares were net settled into shares of common stock of Legacy Tempo. Upon the consummation of the Merger, each share of Legacy Tempo common stock issued and outstanding was canceled and converted into the right to receive 0.1705 shares (the “Exchange Ratio”) of common stock of ACE. Further upon the Closing, (i) each Legacy Tempo Option granted under the 2015 Equity Incentive Plan was converted into (a) the right to receive a number of Tempo Earnout Shares and (b) a New Tempo Option, upon substantially the same terms and conditions as in effect with respect to the corresponding Legacy Tempo Option and (ii) each Legacy Tempo RSU granted under the 2015 Equity Incentive Plan was converted into (a) the right to receive a number of Tempo Earnout Shares and (b) a New Tempo RSU, upon substantially the same terms and conditions as in effect with respect to the corresponding Tempo RSU. Earnout Arrangement with holders of Legacy Tempo common stock and outstanding equity awards Concurrent with the closing of the Merger, holders of Legacy Tempo common stock and outstanding equity awards (including warrant, stock option and RSU holders) agreed to the right to receive up to an aggregate amount of 7,000,000 shares of Company common stock (or equivalent equity award) (the “Earnout Shares”) that would be issued if the following targets are achieved: ● 3,500,000 Earnout Shares (“Tranche 1”) will be issued upon achieving $5.0 million in Adjusted EBITDA in a single quarter during the five-year period following the Merger, and ● 3,500,000 Earnout Shares (“Tranche 2”) will be issued upon achieving $15.0 million in sales in a single quarter during the five-year period following the Merger. Legacy Tempo employees entitled to receive Earnout Shares must provide service through the date the target is achieved and an employee departs, the Earnout Shares are reallocated to the remaining pool of recipients who received the right to the Earnout Shares on the Merger Date. Of the 7,000,000 Earnout Shares, 1,824,463 Earnout Shares were given to common stock, option and RSU holders that are held by current employees and directors and are accounted for under ASC 718. Refer to Note 9 for further discussion of the accounting impact of such Earnout Shares. The remaining 5,175,537 Earnout Shares (the “Other Earnout Shares”) are not within the scope of ASC 718 and are liability classified under ASC 815-40, as they represent equity linked instruments that are not considered indexed to the Company’s own stock. Accordingly, the earnout shares are remeasured at fair value at each reporting date. The Company recorded a liability of $5.3 million at the time of closing associated with Other Earnout Shares. The Company remeasured the liability at December 31, 2022 to $0.4 million, resulting in a gain on remeasurement for the period from the date of the Merger to December 31, 2022 of $4.9 million, which is recorded within change in fair value of earnout liabilities on the consolidated statement of operations. Refer to Note 3 for further discussion of the valuation considerations related to the Earnout Shares. Other Arrangements entered into at time of Merger or assumed upon Merger First Amended Loan Security Agreement On November 22, 2022, Legacy Tempo entered into that certain First Amended and Restated Loan and Security Agreement (the “Amended LSA”), dated as of November 22, 2022, with the same lender group to the Company’s preexisting Loan and Security Agreement (the “LSA”). Concurrent with Legacy Tempo’s entry into the Amended LSA, Legacy Tempo repaid a portion of the outstanding balance under the Prior LSA to the Lenders in a cash amount equal to $3.0 million. Additionally, the Lenders entered into the Lender Subscription Agreements pursuant to which a portion of the outstanding balance under the Prior LSA in an amount equal to $7.0 million was converted into shares of common stock of New Tempo at a conversion rate of $10.00 per share. The Lenders (the “LSA PIPE Investors”) received 700,000 Committed PIPE Shares and 1,120,000 in PIPE Incentive Shares issued in exchange for the satisfaction of obligations. Further the lenders obtained the rights to receive the previously mentioned Additional Shares and Additional Period Shares. New Tempo Warrants On November 22, 2022, upon close of the Merger the Company assumed the 11,499,987 of public warrants and 6,600,000 of private warrants of ACE that were outstanding immediately prior to the Merger. The Company has accounted for the public warrants as equity classified instruments and the private warrants as liability classified instruments subject to remeasurement at each reporting date. Refer to Notes 3 and 8 for further discussion. Capital Markets Advisor Fees Prior to the Merger, Legacy Tempo agreed that with the closing of the Merger the Company would settle amounts owed to capital market advisors of $1.5 million by issuing 75,000 shares of common stock at closing worth $0.8 million and by agreeing to pay $0.8 million in cash. The amounts payable in shares is subject to adjustment during the twelve-month period following the closing, so as to provide that the advisors receive shares equal to $0.8 million at the end of the measurement period. The Company issued 159,948 shares of Common Stock to each capital markets advisor on February 10, 2023. The stock-based payment arrangement with the service provider was accounted for under ASC 718. The Company initially recorded the share issuance as an expense of $0.8 million and an offset to additional paid-in capital. Further, the Company recorded an additional liability of $0.7 million due to a decline in the Company’s share price, with such an amount being recorded as additional stock-based compensation expense in the statement of operations. For the period from the date of the Merger to December 31, 2022, the Company paid $0.5 million of the cash amounts due, with $0.3 million remaining accrued and unpaid as of December 31, 2022. White Lion Stock Purchase Agreement On November 22, 2022, subsequent to the closing of the Merger, New Tempo assumed the responsibilities of the Purchase Agreement and the White Lion Registration Rights Agreement with White Lion. Pursuant to the Purchase Agreement, the Company has the right, but not the obligation to require White Lion to purchase, from time to time, up to the lesser of (i) $100.0 million in aggregate gross purchase price of newly issued shares of Common Stock and (ii) the Exchange Cap, in each case, subject to certain limitations and conditions set forth in the Purchase Agreement. New Tempo assumed a liability of $1.0 million for the commitment fee owed to White Lion, which was paid out of the funds released from Trust at the time of Merger. No stock purchases under the Purchase Agreement were made during the year ended December 31, 2022. Refer to Note 13 for further discussion. Agreements with ACE Sponsor With the closing of the Merger, 3,750,000 shares previously held by the Sponsor in ACE, became holdings in New Tempo. Further, in accordance with the Sponsor support agreement entered into prior to closing of the Merger, on the earlier of (i) the date which is fifteen Accounting for the Business Combination Upon the closing of the Merger, Tempo’s certificate of incorporation was amended and restated to increase the total number of authorized shares of all classes of capital stock to 620,000,000 shares, of which 600,000,000 shares are designated as common stock, $0.0001 par value per share; and 20,000,000 shares designated preferred stock, $0.0001 par value per share. Immediately following the closing of the Merger, there were 26,393,195 shares of the Company’s common stock issued and outstanding and warrants to purchase 18,100,000 shares of the Company’s common stock outstanding. The Merger is accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, ACE was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Merger was treated as the equivalent of Legacy Tempo issuing stock for the net assets of Tempo accompanied by a recapitalization. Accordingly, all historical financial information presented in the consolidated financial statements represents the accounts of Tempo and its wholly owned subsidiaries as if Legacy Tempo is the predecessor to the Company. The shares and net loss per common share, prior to the Merger, have been retroactively restated as shares reflecting the Exchange Ratio established in the Merger (0.1705 shares of Company common stock for every one share of Legacy Tempo common stock). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies Emerging Growth Company Status The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that the Company (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, the Company’s financial statements may not be comparable to financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards based on public company effective dates. The Company will remain an emerging growth company under the JOBS Act until the earliest of (i) the last day of our first fiscal year following the fifth anniversary of the closing of ACE’s initial public offering, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three-years. Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). References to ASC and ASU included herein refer to the Accounting Standards Codification and Accounting Standards Update established by the Financial Accounting Standards Board (“FASB”) as the source of authoritative U.S. GAAP. The financial statements include all of the accounts of the Company and all intercompany balances and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year presentation of our consolidated financial statements. These reclassifications had no effect on the Company’s reported consolidated results of operations. Liquidity and Going Concern The Company has experienced negative cash flows from operations since inception and expects negative cash flows from operations to continue for the foreseeable future. The Company had an accumulated deficit of $253.2 million, cash, cash equivalents and restricted cash of $7.4 million , and a working capital deficiency of $31.1 million as of December 31, 2022. During the year ended December 31, 2022, the Company used net cash of $28.8 million in operating activities and incurred a net loss of $144.9 million. Additionally, as of the date these financial statements were available for issuance, the Company has approximately $3.2 million of contractual loan principal payments and finance lease obligations coming due within the next 12 months and the Company was not in compliance with its outstanding debt covenants under the A&R LSA (as defined in Note 5). These conditions exist that raise substantial doubt about the Company’s ability to continue as a going concern. In order to fund planned operations while meeting obligations as they come due, the Company will need to secure additional debt or equity financing. However, there can be no assurance that the Company will be able to obtain such funding on terms acceptable to the Company, on a timely basis or at all, particularly in light of the Company’s current stock price and liquidity. As a result, substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date that the financial statements are available to be issued. Failure to secure additional funding may require the Company to modify, delay, or abandon some of its planned future expansion or development, or to otherwise enact additional operating cost reductions available to management, which could have a material adverse effect on the Company’s business, operating results, financial condition, and ability to achieve its intended business objectives. The accompanying audited financial statements have been prepared in conformity with U.S. GAAP, assuming the Company will continue as a going concern and do not include adjustments that might result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Those estimates and assumptions include, but are not limited to, revenue recognition and deferred revenue; allowance for doubtful accounts; share-based compensation; determination of fair value of our debt; determination of fair value of embedded derivatives; determination of fair value of our warrants; accounting for income taxes, including the valuation allowance on deferred tax assets and reserves for uncertain tax positions; accrued liabilities; and the recognition and measurement of earnout liabilities. We evaluate our estimates and assumptions on an ongoing basis using historical experience and other factors and adjust those estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates, and those differences could be material to the financial statements. Risks and Uncertainties The Company is subject to a number of risks. The Company conducts business in a dynamic high technology industry and believes that changes in any of the following areas could have a material adverse effect on its future financial position, results of operations, or cash flows: advances and trends in new technologies and industry standards; pressures resulting from new applications offered by competitors; delays in applications and functionality development; changes in certain strategic relationships or customer relationships; the Company’s ability to attract new customers or retain existing customers; the length of the Company’s sales cycles and expense related to sales efforts; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; changes in domestic and international economic or political conditions or regulations; the ability of the Company to finance its operations; and the Company’s ability to attract and retain employees necessary to support its growth. Additionally, the COVID-19 pandemic has negatively impacted the global economy, disrupted supply chains, constrained work force participation, and created significant volatility and disruption of financial markets. Further, the Company faces risks with respect to the inflationary environment in the country and the related fluctuations in interest as well as currency exchange rates. As the scope and duration of these events are unknown and the extent of its economic impact continues to evolve globally, there is uncertainty related to the ultimate impact it will have on the Company’s business, its employees, results of operations and financial condition. COVID-19 Impact On March 11, 2020, the World Health Organization declared that the worldwide spread and severity of a new coronavirus, referred to as COVID-19, was severe enough to be characterized as a pandemic. In response to the continued spread of COVID-19, governmental authorities around the world have imposed various restrictions designed to slow the pace of the pandemic, including restrictions on travel and other restrictions that prohibit employees from going to work causing severe disruptions in the worldwide economy. The COVID-19 pandemic has had and may continue to have an adverse impact on the Company’s employees, operations, supply chain and distribution system. If the Company’s suppliers experience additional closures or reductions in their capacity utilization levels in the future, the Company may have difficulty sourcing materials necessary to fulfill production requirements. Due to the COVID-19 pandemic, Tempo has experienced some supply chain constraints, including with respect to semiconductor components, and has responded by ordering larger quantities of these components to ensure an adequate supply. COVID-19 has also impacted the Company’s customers and may create unpredictable reductions or increases in demand for Tempo’s manufacturing services. Management will continue to monitor the impact of the global situation on the Company’s financial condition, cash flows, operations, industry, workforce, and customer relationships. Revenue from Contracts with Customers Contract Balances The timing of revenue recognition, billings and cash collections can result in deferred revenue (contract liabilities), unbilled receivables (contract assets), and billed accounts receivable. a. Contract Liabilities A contract liability results when payments from customers are received in advance for assembly and manufacturing of the goods. The Company recognizes contract liabilities as revenues upon satisfaction of the underlying performance obligations. Deferred revenue that is expected to be recognized as revenue during the subsequent twelve-month period from the date of billing is recorded in contract liabilities and the remaining portion, if any, is recorded in contract liabilities, noncurrent on the accompanying consolidated balance sheets at the end of each reporting period. For the years ended December 31, 2022 and 2021, the Company recognized revenue of $0.1 million that was included in the contract liabilities balance at the beginning of the related periods, respectively. b. Contract Assets Billings scheduled to occur after the performance obligation has been satisfied and revenue recognition has occurred result in contract assets. Unbilled receivables that are expected to be billed during the subsequent twelve-month period from the date of revenue recognition are recorded in contract assets, and the remaining portion, if any, is recorded in other noncurrent assets on the accompanying consolidated balance sheets at the end of each reporting period. Unbilled receivables represent amounts for which the Company has recognized revenue, pursuant to its revenue recognition policy, for services already performed, but billed in arrears and for which the Company believes it has an unconditional right to payment. Below are the accounts receivables, contract assets, and contract liabilities (in thousands): December 31, December 31, 2022 2021 Accounts receivable, net $ 2,633 $ 2,918 Contract assets 233 1,219 Contract liabilities 2,595 175 Cost of Revenue Cost of revenue primarily includes direct materials, direct labor, and manufacturing overhead incurred for revenue-producing units shipped. Cost of revenue also includes associated warranty costs, shipping and handling, stock-based compensation and other miscellaneous costs. Research and Development Research and development costs are expensed as incurred and consist primarily of personnel and related costs for product development activities. Research and development costs also include professional fees payable to third parties, license and subscription fees for development tools, manufacturing-related costs associated with product development and stock-based compensation. Sales and marketing expense Sales and marketing expenses consist of personnel and related expenses for our employees working in sales and marketing and business development departments including salaries, bonuses, payroll taxes, and stock-based compensation. Also included are non-personnel costs such as marketing activities, professional and other consulting fees. General and administrative expense General and administrative expenses consist primarily of personnel and related expenses for our employees in our finance and administrative teams including salaries, bonuses, payroll taxes, and stock-based compensation. It also consists of legal, consulting, and professional fees, rent expenses pertaining to our offices, business insurance costs and other costs. Advertising Costs Advertising costs are expensed as incurred. These amounts are included in the selling and marketing expense in the accompanying consolidated statements of operations. Advertising costs were $0.3 million and $0.5 million for the years ended December 31, 2022 and 2021, respectively. Concentration of Risks Concentration of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, and accounts receivable. The Company’s cash and cash equivalents and restricted cash are on deposit with major financial institutions. Such deposits may be in excess of insured limits. The Company believes that the financial institutions that hold the Company’s cash are financially sound, and accordingly, minimum credit risk exists with respect to these balances. The Company has not experienced any losses due to institutional failure or bankruptcy. The Company performs credit analyses and monitors the financial health of its customers to reduce credit risk. The Company reviews accounts receivable balances to determine if any receivables will potentially be uncollectible and includes any amounts that are determined to be uncollectible in the allowance for doubtful accounts. As of December 31, 2022, there was one customer who had outstanding balances accounting for 61% of the total accounts receivable balance. As of December 31, 2021, there was one customer who had outstanding balance accounting for 49% of the total accounts receivable balance. Concentration of customers For the year ended December 31, 2022, two customers represented 21% and 20% of revenue, respectively. For the year ended December 31, 2021, one customer represented 46% of revenue. Segment Reporting and Geographic Information For the years ended December 31, 2022 and 2021, the Company was managed as a single operating segment in accordance with the provisions in the FASB guidance on segment reporting, which establishes standards for, and requires disclosure of, certain financial information related to reportable operating segments and geographic regions. Furthermore, the Company determined that the Chief Executive Officer is the Chief Operating Decision Maker as she is responsible for making decisions regarding the allocation of resources and assessing performance as well as for strategic operational decisions and managing the organization as a whole. Substantially all of the Company’s revenues are domestic sales and fixed assets are physically located in the United States. Cash, Cash Equivalents and Restricted Cash The Company considers all highly liquid securities that mature within three months or less from the original date of purchase to be cash equivalents. The Company maintains the majority of its cash balances with commercial banks in interest bearing accounts. Cash and cash equivalents include cash held in checking and savings accounts and highly liquid securities with original maturity dates of three months or less from the original date of purchase. Cash equivalents consisted of $7.0 million and $2.6 million in money market accounts as of December 31, 2022 and 2021, respectively. The restricted cash balance as of both December 31, 2022 and 2021 represents $0.3 million related to a letter of credit for the Company’s office space lease. As of December 31, 2022 2021 Cash and cash equivalents $ 7,113 $ 2,864 Restricted cash 320 320 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 7,433 $ 3,184 Accounts Receivable, Net Accounts receivable, net is recorded at the invoiced amount, net of allowance for doubtful accounts. The allowance is based upon historical losses and an evaluation of the potential risk of loss associated with delinquent accounts. The Company evaluates the need for an allowance for doubtful accounts for estimated probable losses at each period end. Accounts receivable deemed uncollectable are charged against the allowance for doubtful accounts when identified. The Company recorded an allowance for doubtful accounts of $0.2 million and $0.4 million and as of December 31, 2022 and 2021, respectively. Inventory Inventory consists of raw materials and work-in-progress representing the components that the Company produces. The Company uses actual cost to value inventory. In general, the Company procures materials from suppliers when a purchase order is received from its customers. The Company identifies these procured materials as raw material if work on the purchase order has not commenced and for any work that has been started on the materials procured are identified as work-in-progress. Long-Lived Assets Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that their net book value may not be recoverable. If the sum of the expected future cash flows (undiscounted and before interest) from the use of the assets is less than the net book value of the asset an impairment could exist and the amount of the impairment loss, if any, will generally be measured as the difference between the net book value of the assets and their estimated fair values. During the year ended December 31, 2022, the Company abandoned a portion of its leased space and recorded an impairment charge of $0.3 million to leasehold improvements and ROU assets during the year ended December 31, 2022 (see Note 10). Fair Value Option (“FVO”) Election The Company accounts for certain loan and security borrowings outstanding under the fair value option election of ASC 825, Financial Instruments (“ASC 825”) as discussed below. The loan and security borrowings accounted for under the FVO election are each debt host financial instruments containing embedded features, some of which would otherwise be required to be bifurcated from the debt-host and recognized as separate derivative liabilities subject to initial and subsequent periodic estimated fair value measurements under ASC 815. Notwithstanding, ASC 825-10-15-4 provides for the FVO election, to the extent not otherwise prohibited by ASC 825-10-15-5, to be afforded to financial instruments, wherein bifurcation of an embedded derivative is not necessary, and the financial instrument is initially measured at its issue-date estimated fair value and then subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value adjustment, as required by ASC 825-10-45-5, is recognized as a component of other comprehensive income (“OCI”) with respect to the portion of the fair value adjustment attributed to a change in the instrument-specific credit risk, with the remaining amount of the fair value adjustment recognized as other income (expense) in the accompanying consolidated statements of operations. With respect to the above loan and security borrowings, the estimated fair value adjustment is presented as change in fair value of debt within other income (expense) in the accompanying consolidated statements of operations, since the change in fair value of the loan and security borrowings payable was not attributable to instrument specific credit risk during the year ended December 31, 2022. Property and Equipment, Net Property and equipment, net is stated at cost less accumulated depreciation and amortization. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gain or loss is included in the current period. Repair and maintenance costs are expensed as incurred. Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets (in years): Useful Lives Computer equipment 3 Software 5 Furniture and fixtures 3 Leasehold improvements Shorter of useful life or remaining lease term Manufacturing equipment 10 Income Taxes The Company uses the asset-and-liability method for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement carrying amounts and tax bases of assets and liabilities and operating loss and tax credit carryforwards and are measured using the enacted tax rates that are expected to be in effect when the differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to an amount that, in the opinion of management, is more likely than not to be realized. The Company accounts for uncertain tax positions based on an evaluation as to whether it is more likely than not that a tax position will be sustained on audit, including resolution of any related appeals or litigation processes. This evaluation is based on all available evidence and assumes that the appropriate tax authorities have full knowledge of all relevant information concerning the tax position. The tax benefit recognized is based on the largest amount that is greater than 50% likely of being realized upon ultimate settlement. The Company includes interest expense and penalties related to its uncertain tax positions in interest expense and other expense, respectively. Stock-Based Compensation The Company has a stock incentive plan under which incentive stock options and restricted stock units (“RSUs”) are granted to employees and non-qualified stock options are granted to employees, investors, directors and consultants. The Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. The fair value of the Company’s common stock underlying the awards has historically been determined by the board of directors with input from management and third-party valuation specialists, as prior to the Merger there was no public market for the Company’s common stock. The board of directors determined the fair value of the common stock by considering a number of objective and subjective factors including: the valuation of comparable companies, the Company’s operating and financial performance, the lack of liquidity of common stock, transactions in the Company’s stock, and general and industry specific economic outlook, amongst other factors. Equity-classified awards issued to employees, non-employees, and directors are measured at the grant-date fair value of the award. Forfeitures are recognized as they occur. For accounting purposes, the Company estimates grant-date fair value of stock options using the Black-Scholes-Merton (“BSM”) option pricing model. The BSM option pricing model requires the input of highly subjective assumptions, including the fair value of the underlying common stock, the risk-free interest rates, the expected term of the option, the expected volatility of the price of the Company’s common stock, and the expected dividend yield of the Company’s common stock. The fair value of each RSU is the fair value of the underlying common stock on the grant date. Net Loss Per Share of Common Stock The Company computes earnings per share (“EPS”) following ASC Topic 260, Earnings Per Share. Basic EPS is measured as the income or loss available to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per-share basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially convertible securities are calculated using the if-converted method; the potentially dilutive effect of options or warrants are computed using the treasury stock method. Securities that are potentially an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from diluted EPS calculation. Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). The Company has no components of other comprehensive income (loss). Therefore, net income (loss) equals comprehensive income (loss) for all periods presented. Related Parties As of December 31, 2022, the Company owed $1.0 million to ACE affiliates and $0.2 million to a member of the Company’s board of directors, in connection with the merger activities. Other than the related party borrowings described in Note 6, there were no other material related-party transactions during the year ended December 31, 2022 and 2021. Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” or ASU 2016-13. The amendments in ASU 2016-13 introduce an approach based on expected losses to estimated credit losses on certain types of financial instruments, modify the impairment model for available-for-sale debt securities and provide for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The new standard requires financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The standard will be effective for the Company beginning January 1, 2023, with early application permitted. The Company is evaluating the impact and does not expect a material impact of adopting this new accounting guidance on its consolidated financial statements. In October 2021, the FASB issued Accounting Standards Update No. 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”, which requires accounting for contract assets and liabilities from contracts with customers in a business combination to be accounted for in accordance with ASC 606. The standard is effective for fiscal years beginning after December 15, 2022. The Company is evaluating the impact and does not expect a material impact of adopting this new accounting guidance on its consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | (3) Fair Value Measurements Assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: ● Level 1: Quoted prices for identical assets or liabilities in active markets at the measurement date. ● Level 2: Inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities, in active markets or other inputs that are observable or can be corroborated with market data at the measurement date. ● Level 3: Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, certain term loans and loan and security borrowings, warrant liabilities, and earnout liabilities. The Company has determined the carrying value of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, finance leases, and certain loan and security borrowings approximates the fair value due to their short-term maturities. The following table provides a summary of all financial instruments measured at fair value on a recurring basis as of December 31, 2022 and 2021 (in thousands): December 31, 2022 Level 1 Level 2 Level 3 Total Financial Liabilities: Warrant liabilities $ — $ 389 $ — $ 389 Earnout liability – Tempo Earnout — — 410 410 Earnout liability – Additional Period Shares — — 763 763 A&R LSA Borrowings — — 20,101 20,101 Total $ — $ 389 $ 21,274 $ 21,663 December 31, 2021 Level 1 Level 2 Level 3 Total Financial Liabilities: Warrant Liability $ — $ — $ 5,573 $ 5,573 Total $ — $ — $ 5,573 $ 5,573 The private warrants were valued using the publicly available price of the public warrants, adjusted as appropriate for unobservable lack of liquidity inputs. The fair value of the Tempo Earnout Shares is determined based on “Level 3” inputs, due to a lack of market data over inputs such as the volatility and the time incurred to meet the minimum VWAP as discussed above. The earnout shares are measured at fair value using the Monte Carlo valuation model. The valuation model utilized various key assumptions, such as volatility, discount rate and time incurred to meet the minimum VWAP. As of November 22, 2022, the fair value of the Tempo Earnout Shares associated with each Tranche 1 and Tranche 2 was $0.29 per share and $1.76 per share, respectively. As of December 31, 2022 the fair value of the Tempo Earnout Shares associated with each Tranche 1 and Tranche 2 was $0.02 and $0.13 per share. In determining the fair value of the Tempo Earnout Shares as of December 31, 2022, the Company used the following inputs: December 31, 2022 Volatility 12.5 % – 38.0 % Discount rate 9.1 % – 17.7 % Expected term 4.8 years The fair value of the Additional Period Shares is determined based on “Level 3” inputs, due to a lack of market data over inputs such as the volatility and the time incurred to meet the minimum VWAP as discussed above. The earnout shares are measured at fair value using the Monte Carlo valuation model. The valuation model utilized various key assumptions, such as volatility, discount rate and time incurred to meet the minimum VWAP. As of November 22, 2022 and December 31, 2022, the fair value of the Additional Period Shares was nil and $0.76 per share, respectively. In determining the fair value of the Additional Period Shares as of December 31, 2022, the Company used the following inputs: December 31, 2022 Volatility 4.7 % Discount rate 50.4 % Expected term 1.1 years The fair value of the A&R LSA borrowings is determined based on “Level 3” inputs, due to a lack of market data over inputs such as the volatility and the time to various settlement events, including a maturity, liquidity, prepayment, default and dissolution scenarios. The A&R borrowings are measured at fair value using a Monte Carlo valuation model. The valuation model utilized various key assumptions, such as volatility, discount rate and time until the achievement of various scenarios. |
Other Balance Sheet Components
Other Balance Sheet Components | 12 Months Ended |
Dec. 31, 2022 | |
Other Balance Sheet Components | |
Other Balance Sheet Components | (4) Other Balance Sheet Components (a) Inventory Inventory consists of the following (in thousands): As of December 31, 2022 2021 Raw materials $ 2,127 $ 158 Work in progress 451 721 Total inventory $ 2,578 $ 879 (b) Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): As of December 31, 2022 2021 Prepaid expense $ 401 $ 650 Other current assets 343 242 Total prepaid expenses and other current assets $ 744 $ 892 (c) Property and Equipment, net Property and equipment, net consists of the following (in thousands): As of December 31, 2022 2021 Manufacturing equipment $ 9,743 $ 9,732 Leasehold improvements 3,993 4,811 Computer equipment 453 489 Office furniture and fixtures 462 462 Software 248 248 Total property and equipment 14,899 15,742 Less accumulated depreciation (8,385) (6,851) Total property and equipment, net $ 6,514 $ 8,891 Depreciation expense for the years ended December 31, 2022 and 2021 was $2.2 million and $2.3 million, respectively. During the year ended December 31, 2022, the Company recognized an impairment charge of $0.2 million to the leasehold improvements. These impairment charges were recorded within impairment loss in the consolidated statements of operations. During the year ended December 31, 2021, the Company did not have any impairment charges. (d) Other Noncurrent Assets Other noncurrent assets consist of the following (in thousands): As of December 31, 2022 2021 Deferred transaction costs (1) $ — $ 1,926 Advance rent and prepaids 83 749 Deposits — 250 Total other noncurrent assets $ 83 $ 2,925 (1) Deferred transaction costs were expensed at the consummation of the merger transaction. (e) Accrued Liabilities Accrued liabilities consist of the following (in thousands): As of December 31, 2022 2021 Accrued legal fees(1) $ 4,053 $ 1,562 Accrued professional fees(1) 2,446 1,398 Accrued sales and business taxes 221 241 Accrued cost of revenue 176 236 Warranty liability 49 54 Other accrued liabilities 264 480 Total accrued expenses $ 7,209 $ 3,971 (1) These accrued legal and professional fees primarily relate to the merger transaction, as discussed in Note 1 – Organization. (f) Accrued Compensation and Related Benefits Accrued compensation and related benefits consist of the following (in thousands): As of December 31, 2022 2021 Accrued payroll $ 380 $ 41 Accrued vacation 244 — Accrued commissions 39 121 Accrued bonus — 647 Accrued payroll taxes 26 356 Other accrued benefits — 84 Total accrued compensation and related benefit $ 689 $ 1,249 |
Borrowing Arrangements
Borrowing Arrangements | 12 Months Ended |
Dec. 31, 2022 | |
Borrowing Arrangements | |
Borrowing Arrangements | (5) Borrowing Arrangements Term Loan and Credit Facility with Financial Institution On June 23, 2021, the Company entered into an amended and restated loan and security agreement with the financial institution expanding its Term Loan obligation from $4.0 million to $10.0 million, with the maturity date extended to September 1, 2022 and a loan commitment fee of $50 thousand. For the Term Loan the Company is required to make monthly interest only payments from January 2021 through December 2021, thereafter certain monthly principal plus interest payments for a period of 8 months beginning from January 2022 and a final payment of the balance principal and interest outstanding under the agreement in September 2022. The amended and restated term loan debt bears interest at the greater of (a) Wall Street Journal Prime plus 5.00%, floating or (b) 8.25% per annum. In addition, the Company issued 18,601 warrants to the lender which are exercisable to purchase the Company’s common stock at $8.85. For further details on the warrants issued in conjunction with the term loan, see Note 8. On October 14, 2021, the Company paid $10.3 million to settle the credit facility under the amended and restated loan and security agreement with Silicon Valley Bank including $0.3 million of interest. Equipment Loan and Security Agreement On January 29, 2021, the Company entered into an equipment loan and security agreement with SQN Venture Income Fund II, LP. The overall loan facility provides for a maximum borrowing capacity of $6.0 million consisting of two tranches, each On January 29, 2021, the Company drew down $3.0 million under the first tranche of the facility. The Company is required to make monthly payments for a period of 42 months on this tranche plus end of term payment fee of $0.2 million which is accreted to interest expense over the term of the agreement. The loan has a maturity date of July 2024. An additional $3.0 million can be drawn by the Company, provided that certain criteria are met, such as the Company not having defaulted on the first tranche and there having not been a material adverse change (as defined in the Loan Agreement) as of the date for the borrowing request. The loan facility is used for financing certain equipment purchases. The equipment financed through the loans serves as collateral for the loan. The loan bears a cash interest of 8.95% per annum. Interest is payable on the first day of the month. If the loan is in default, it shall bear interest at a rate of an additional 5% per annum. The loan interest expense and discount amortization interest for the year ended December 31, 2022 was $0.1 million and $34 thousand, respectively. The Company was in compliance with the covenants as of December 31, 2022. In conjunction with entering into the equipment loan and security agreement, the Company entered into a warrant agreement with the lender and issued 18,417 warrants exercisable for the Company’s common stock at $5.51. For further details on the warrants issued in conjunction with the equipment loan and security agreement, see Note 8. Paycheck Protection Program Loan In May 2020, the Company was granted a loan under the Paycheck Protection Program offered by the Small Business Administration (“SBA”) under the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), section 7(a)(36) of the Small Business Act for $2.5 million. The loan is evidenced by a promissory note and bears interest at 1% with no principal payments for the first 6 months. Monthly payments of principal and interest of approximately $0.1 million begin in December 2020, subject to deferral as the Company has applied for debt forgiveness, and continue through maturity in May 2022, if required. The loan is subject to partial or full forgiveness if the Company uses all proceeds for eligible purposes; maintains certain employment levels; and maintains certain compensation levels in accordance with and subject to the CARES Act and the rules, regulations, and guidance. The Company applied for forgiveness of the PPP loan and was notified that the entire $2.5 million PPP loan was forgiven in August 2021. Loan forgiveness of $2.5 million is reflected in other income and expense section in the consolidated statements of operations. Even though the PPP loan was forgiven, it remains subject to audit by the SBA. June 2021 Credit Facility On June 23, 2021, the Company entered into the June 2021 Credit Facility with SQN Venture Income Fund II, LP. The June 2021 Credit Facility provides for a maximum borrowing capacity of $20.0 million consisting of two tranches, each On June 23, 2021, the Company drew down $10.0 million of the facility. The Company was required to make monthly interest-only payments for a period of 18 months and thereafter, principal and interest payments under the agreement although the maturity date of December 2022. On August 13, 2021, the Company drew down the remaining $10.0 million. The second tranche had a maturity date of February 2023. The June 2021 Credit Facility was used for general working capital purposes. This loan bore cash interest of 10% per annum. Interest was payable on the first day of the month. Additionally, this loan bore a Paid-in-Kind (“PIK”) interest of 2% per annum with PIK interest capitalized, compounded, and added to the principal balance monthly in arrears. The PIK interest became payable upon maturity. If the term loan was in default, it would bear interest at an additional 5%. The Company paid a nonrefundable facility fee of $0.2 million. In conjunction with entering into the June 2021 Credit Facility, the Company entered into a warrant agreement with the lender and issued 90,948 warrants exercisable for the Company’s common stock at $8.85. For further details on the warrants issued in conjunction with the June 2021 Credit Facility, see Note 8. Loan and Security Agreement On October 13, 2021, the Company entered into the Loan and Security Agreement (“LSA”) with Structural Capital Investments III, LP, Series Structural DCO II, a series of Structural Capital DCO, LLC, SQN Tempo Automation, LLC, SQN Venture Income Fund II, LP, and Ocean II PLO LLC. The LSA replaced the June 2021 Credit Facility, providing for maximum borrowing capacity of $150.0 million consisting of four tranches. Per the LSA, borrowings of $20.0 million from tranches 1 and 2 from the June 2021 Credit Facility were replaced by a new tranche 1 in the amount of $20.0 million. Borrowing capacity for tranche 2 is $20.0 million which shall be available to draw by the Company upon sooner of the de-SPAC with ACE or closing of the acquisition with Whizz. Borrowing capacity for tranche 3 and tranche 4 of the LSA is $40.0 million, and $70.0 million, respectively, which shall be available to draw by the Company upon the de-SPAC with ACE, subject to lender approval. The tranches have an earliest expiration date of December 23, 2022. The termination of the June 2021 Credit Facility and subsequent borrowings under tranche 1 of the LSA was accounted for as a partial extinguishment of debt. Specifically, upon entering into the LSA, the Company became indebted to a new lender in the amount of $6.0 million, while $14.0 million of obligations are due to the same lender group party to the June 2021 Credit Facility. The $6.0 million was reflected as a debt repayment with the old lender and was accounted for as an extinguishment of debt. Accordingly, the Company recorded a loss on extinguishment of $0.3 million related to the write off of unamortized debt discount. The Company also evaluated the $14.0 million of debt outstanding with continuing lenders and concluded the transaction should be treated as a modification of debt. Borrowings under tranches 2, 3 and 4 of the LSA bear interest equal to the greater of (i) 10.5%, and (ii) 7.25% plus the prime rate then in effect, provided however, for all advances made after the occurrence of the public trading trigger, a per annum rate of interest equal to the greater of (i) 9.5%, and (ii) 6.25% plus the prime rate then in effect shall apply. Borrowings under tranche 1 bear interest equal to 10%. In addition, interest will accrue at an additional 2% per annum rate on the outstanding borrowing made under the tranche 1, which shall be capitalized and be compounded and added to the principal balance of the Tranche 1 Loan monthly in advance on the next monthly payment date. For borrowings made pursuant to the LSA, the Company is further committed to a fee in an amount sufficient, if needed, to increase the lender’s minimum return to 1.20:1.00 if payable on or before the first anniversary of such borrowing, 1.30:1.00 if payable after the first anniversary of such borrowing but on or before the second anniversary of such borrowing, 1:35:1.00 if payable after the second anniversary of such borrowing but on or before the third anniversary of such borrowing, or 1.40:1.00 if payable after the third anniversary of such borrowing. On January 11, 2022, the Company entered into the first amendment to the LSA to convert $10.0 million of availability under the tranche 2 loan to the tranche 1 loan. This amendment expanded the tranche 1 from $20.0 million to $30.0 million and reduced the tranche 2 loan from $20.0 million to $10.0 million. For the original $20.0 million borrowed under tranche 1, the maturity date is December 23, 2022 and the $10.0 million borrowed under the expanded portion of tranche 1 provides for a maturity date of February 12, 2023. On January 20, 2022, in conjunction with the LSA, the Company entered into warrant agreements with the various lenders involved under the LSA to issue a certain number of warrants to purchase stock based on the percentage of each tranche borrowing exercisable for the Company’s stock at the lowest of (i) $2.82 per share, (ii) the lowest price per share the Company receives for a share of stock, and (iii) the lowest price the Company receives for a share of future round of stock, see Note 8. On May 1, 2022, the Company was in breach of its covenants under the LSA. As a result, the Company recorded $0.9 million of default interest expense in the Company’s consolidated statements of operations during the year ended December 31, 2022. On August 25, 2022, Tempo exchanged approximately $3.6 million of amounts due under the LSA for newly issued bridge notes, whereby Tempo entered into an August 2022 Bridge Note Agreement (as defined in Note 6 below) with the lenders under the LSA (collectively, the “Initial Bridge Investors”). Pursuant to the agreement, in satisfaction of certain LSA obligations, Tempo agreed to issue a $3.6 million note (“LSA Convertible Note”) which is comprised of accrued interest, PIK interest and future interest from August 2022 through maturity of the LSA. The transaction was accounted for as an extinguishment of debt and the Company recorded a loss on extinguishment of $10.1 million. As discussed in Note 6, the Company elected to account for the August 2022 Bridge Notes, including those issued as LSA Convertible Notes, under the fair value option. The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 30,407 Accrued interest 520 Fair value of new LSA (28,154) Fair value of LSA Convertible Note (12,903) Loss on extinguishment of debt $ (10,130) November 2022 Amended and Restated LSA On November 22, 2022, in connection with the closing of the Merger, the Company entered into that certain First Amended and Restated Loan and Security Agreement (“A&R LSA”), by and among, the Company, as borrower and the LSA lenders, pursuant to which the Lenders committed to lend the Company up to $20.0 million in term loan financing (the “A&R LSA Facility” or the “Credit Facility”). The A&R LSA amended and restated in its entirety that certain LSA, dated as of October 13, 2021, by and among the Company and the lenders. The A&R LSA bears interest equal to a per annum rate of the greater of (i) 9.75%, and (ii) 4.25% plus the prime rate then in effect. Additionally, this loan bears a PIK interest of 3.25% per annum with PIK interest capitalized, compounded, and added to the principal balance monthly in arrears. As of December 31, 2022, the Company had $0.1 million of accrued PIK interest associated with A&R LSA. Repayments of the principal balance outstanding from the A&R LSA commence in December 2023. The A&R LSA Facility matures on December 1, 2025, but if this loan is not fully repaid by May 15, 2024, the Company would be required to pay an exit fee equal to 80% of the principal. As of December 31, 2022, the Company was in compliance with the debt covenants under the A&R LSA. As of the filing date of this Annual Report, the Company was not in compliance with the Unrestricted Cash Covenant which triggered the default interest rate provision and makes the debt callable by the lenders. On November 22, 2022, pursuant to terms of the A&R LSA, the Company repaid a portion of the outstanding balance under the LSA to the Lenders in a cash amount equal to $3.0 million, and $0.4 million in lender fees. Additionally, the Lenders entered into the Lender Subscription Agreements(the “LSA”) pursuant to which a portion of the outstanding balance under the LSA in an amount equal to $7.0 million was converted into 700,000 shares of common stock at a conversion rate of $10.00 per share. As a result of the modification, tranches 2 through 4 of the original LSA were removed and are not available to be drawn under the new facility. The amendment to the LSA was accounted for as a debt extinguishment and the Company recorded a loss on extinguishment of $13.3 million. On the date of the extinguishment, the Company has elected to account for borrowings under the A&R LSA under the fair value option. The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 29,351 Fair value of A&R LSA (20,000) Principal repayment (3,000) Fair value of common stock issued (7,336) Fair value of PIPE Incentive Shares issued (11,738) Fair value of Additional Period Shares liability (1) Financing fees (614) Loss on extinguishment of debt $ (13,338) The following table sets forth the net carrying amounts of borrowings as of December 31, 2022 (in thousands): Loan Payable, Loan Payable, Current Noncurrent Total SQN Equipment Loan $ 876 $ 663 $ 1,539 A&R LSA (FVO) 20,101 — 20,101 Total loan payable $ 20,977 $ 663 $ 21,640 SQN Equipment Loan As of December 31, 2022 Total loan payable $ 1,472 Add: accretion of final interest payable 106 Less: loan payable, current (876) Less: unamortized debt discount (39) Total loan payable, noncurrent $ 663 A&R LSA (FVO) Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 20,000 Less: Payments (250) Change in fair value 351 Balance, December 31, 2022 $ 20,101 LSA Convertible Note Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 12,902 Change in fair value 2,527 Converted to common stock (15,429) Balance, December 31, 2022 $ — Immediately prior to the closing of the Merger, the outstanding LSA Convertible Note was converted into shares of Tempo common stock. The Company performed a final measurement of the LSA Convertible Note to fair value and the related fair value change of $15.6 million was recorded within additional paid in capital on the consolidated balance sheet. In determining the fair value of the A&R LSA as of December 31, 2022, the Company used the following inputs: December 31, 2022 Expected term 3 years Discount rate 13.42 % As of December 31, 2021 SQN LSA LSA Equipment Tranche 1.1 Tranche 1.2 Loan Total Total notes payable $ 10,000 $ 10,000 $ 2,302 $ 22,302 Add: accretion of final interest payable 108 79 56 243 Less: loan payable, current (9,702) — (784) (10,486) Less: unamortized debt discount (406) (218) (84) (708) Total loan payable, noncurrent $ — $ 9,861 $ 1,490 $ 11,351 The notes payable future contractual principal payments are as follows during the years noted (in thousands): As of December 31, 2022 2023 $ 1,205 2024 4,885 2025 15,550 Total future principal payments $ 21,640 |
Borrowing Arrangements - Relate
Borrowing Arrangements - Related Party | 12 Months Ended |
Dec. 31, 2022 | |
Borrowing Arrangements - Related Party | |
Borrowing Arrangements Related Party | (6) Borrowing Arrangements – Related Party Convertible Promissory Notes On January 18, 2022, the Company issued convertible promissory notes to P72 and Lux for gross proceeds of $5.0 million (the “2022 Promissory Notes”). The 2022 Promissory Notes bear simple interest on the unpaid principal at a rate of 10% per year and are due and payable by the Company on demand any time after November 15, 2022. The outstanding amount convert into securities of ACE upon the earlier to occur of the closing of the transactions and the closing of the first qualified financing following any termination of the business combination agreement as applicable. The exchange feature of the 2022 Promissory Notes was deemed an embedded derivative requiring bifurcation from the 2022 Promissory Notes (the “host contract”) and separate accounting as an embedded derivative liability. The proceeds from the 2022 Promissory Notes were first allocated to the embedded derivative liability, resulting in an embedded derivative liability of $0.1 million on issuance, with the remaining proceeds allocated to the host contract. The amended and restated 2022 Promissory Notes do not embody a bifurcated exchange feature described above. As such, the extinguishment date fair value of exchange feature was included in the calculation of the debt extinguishment to derecognize the previously bifurcated derivative liability. The Company recognized $0.2 million and $40 thousand as loss on debt extinguishment and fair value change on derivatives, respectively, during the year ended December 31, 2022 in the accompanying consolidated statements of operations. As discussed below, on August 25, 2022, the 2022 Promissory Notes were amended and restated and the transaction was accounted for as a debt extinguishment. The Company recorded a loss on extinguishment of $17.2 million which was equivalent to the difference between the carrying value of the 2022 Promissory Notes and the fair value on the modification date. The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 5,265 Fair value of embedded derivative 154 Fair value of 2022 Promissory Notes (19,030) Fair value of issued warrants (3,568) Loss on extinguishment of debt $ (17,179) Bridge Note In May 2022, the Company entered into the Bridge Note with ACE and AEPI, which was replaced in its entirety on substantially the same terms on July 1, 2022, pursuant to which AEPI agreed to loan to Tempo up to an aggregate principal amount of $5.0 million, $4.6 million of which was advanced to Tempo as of September 30, 2022. The Bridge Note has an interest rate of 12% per annum, payable in-kind by increasing the outstanding principal amount of the Bridge Note. Interest shall be deemed to have commenced on May 19, 2022. The Bridge Note replaced a May 2022 loan on substantially the same terms in its entirety. The conversion option of the Bridge Note was deemed an embedded derivative requiring bifurcation from the Bridge Note (the “host contract”) and is separately accounted for as an embedded derivative liability. The proceeds from the Bridge Note were first allocated to the embedded derivative liability, resulting in an embedded derivative liability of $0.1 million on issuance, with the remaining proceeds then allocated to the host contract. On August 25, 2022, the Bridge Note was amended and restated on substantially similar terms to the August 2022 Bridge Notes (as defined below). The amended and restated convertible bridge notes do not embody a bifurcated exchange feature described above. As such, the extinguishment date fair value of exchange feature was included in the calculation of the debt extinguishment to derecognize the previously bifurcated derivative liability. The Company recognized $61 thousand as a fair value change on derivatives during the year ended December 31, 2022 in the accompanying consolidated statements of operations. As discussed below, on August 25, 2022, the Bridge Note was amended and restated and the transaction was accounted for as a debt extinguishment. The Company recorded a loss on extinguishment of $11.6 million which was equivalent to the difference between the carrying value of the Bridge Note and the fair value on the modification date. The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 4,477 Fair value of embedded derivative — Fair value of Bridge Note (16,106) Loss on extinguishment of debt $ (11,629) August 2022 Bridge Notes On August 25, 2022, Tempo entered into a note purchase agreement with the Initial Bridge Investors under the Loan and Security Agreement, pursuant to which Tempo agreed to issue up to $5.0 million in aggregate principal amount of August 2022 Bridge Notes to the Initial Bridge Investors for aggregate cash proceeds of approximately $1.4 million and the cancellation of approximately $3.6 million of outstanding amounts owed under the Loan and Security Agreement, refer to Note 6 for further discussion. Further on the same date the Bridge Note and 2022 Promissory Note investors made a $1.2 million cash investment and received Notes valued at $4.4 million. The Company recorded an other financing cost in the consolidated statement of operations of $3.2 million, as the excess of the fair value of the debt over the proceeds received resulted in an up-front expense given that no other transaction element of value was identified. The August 2022 Bridge Notes initially bear interest at a rate of 10% per annum. The August 2022 Bridge Notes will mature, and all outstanding principal and accrued but unpaid interest thereunder will be due and payable by Tempo, on the earlier of August 25, 2023 and the time at which such outstanding amount becomes due and payable upon an event of default under the August 2022 Bridge Notes. Upon the closing of the Merger, all outstanding amounts under the August 2022 Bridge Notes, together with all accrued and unpaid interest thereon, as of such time automatically convert in full into a number of shares of Tempo stock, such that the value of the securities received by the holder of any August 2022 Bridge Note will equal the product of (x) the aggregate principal amount, together with any accrued but unpaid interest, outstanding under such August 2022 Bridge Note as of the time of such conversion multiplied by (y) four. On August 25, 2022, as a condition to closing the issuance and sale of the August 2022 Bridge Notes, Tempo: ● Amended and restated the 2022 Promissory Notes and the Bridge Note on substantially similar terms to the August 2022 Bridge Notes. ● Entered into an amended and restated warrant with existing investors, which amended and restated that certain Warrant to Purchase Shares of Common Stock, dated as of October 11, 2021, to, among other things, provide for the automatic conversion, with an amended exercise price of zero, of such warrant into shares of Tempo common stock upon the consummation of the business combination, a business combination or similar transaction with another special purpose acquisition company, the consummation of a qualified financing or the consummation of an initial public offering or direct listing. At the time of issuance of the August 2022 Bridge Notes, the Company elected to account for the amended and restated 2022 Promissory Notes, the amended and restated Bridge Note and the August 2022 Bridge Notes under the fair value option. The following table sets forth the activity and net carrying amount of related party convertible note borrowings accounted for under the fair value option as of and for the year ended December 31, 2022 (in thousands): Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 39,593 Change in fair value 7,887 Converted to common stock (47,480) Balance, December 31, 2022 $ — Immediately prior to the closing of the Merger, the outstanding related party convertible note borrowings converted into shares of Tempo common stock. The Company performed a final measurement of the August 2022 Bridge Notes, the 2022 Promissory Notes, and the Bridge Note to fair value and the related balance of $47.3 million was reclassified in additional paid-in capital. Asia-IO Upon close of the Merger, the Company has assumed a $0.6 million working capital facility (the “Working Capital Facility”) with ASIA-IO Advisors Limited, a related party. The Working Capital Facility does not bear interest, and does not have a maturity date. As of December 31, 2022, $0.6 million of the Working Capital Facility remains outstanding in loan payable - related party, current in the consolidated balance sheets. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity (Deficit) | |
Stockholders' Equity (Deficit) | (7) Stockholders’ Deficit Effective with the closing of the closing of the Merger the Company restated its articles of incorporation. Under the amended and restated articles of incorporation, the Company has authorized the issuance of 600,000,000 shares of common stock, having a $0.0001 par value per share and the issuance of 20,000,000 shares of preferred stock, having a par value of $0.0001 per share. The Company has reserved shares of common stock for issuance related to stock options and RSUs, warrants, shares reserved for future grants and earnout shares: As of December 31, 2022 Warrants to purchase common stock 18,106,559 Options to purchase common stock and RSUs 4,374,189 Shares reserved for future grants 2,639,329 Earnout shares 7,000,000 Total shares of common stock reserved 32,120,077 |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Warrants | |
Warrants | (8) Warrants Since inception, the Company has issued warrants in conjunction with various debt financings. The Company accounts for its warrants in accordance with ASC 815-40 and ASC 480-10 as either liabilities or as equity instruments depending on the specific terms of the warrant agreement. Warrants are classified as liabilities when there is variability in the number of shares, and when the variability is not related to an implicit or explicit input to the valuation of the Company. Liability-classified warrants are remeasured at each reporting date until settlement, with changes in the fair value recognized in change in fair value of warrants and debt in the consolidated statements of operations. Warrants that meet the fixed-for-fixed criteria or contain variability related to an implicit or explicit input to the valuation of the Company are classified as equity instruments. Warrants classified as equity instruments are initially recognized at fair value and are not subsequently remeasured. During the period ended December 31, 2022 and 2021, the Company had various warrant transactions: In January 2021, the Company entered into a warrant purchase agreement with SQN Venture Income Fund II, LP to issue 18,417 warrants to purchase common stock in conjunction with entering into the Equipment Loan and Security Agreement. The exercise price of these warrants is $5.51 per share. The Company concluded that these warrants are liability classified and shall be measured at fair value at grant date using the BSM option pricing model and subsequently remeasured at each reporting date. In June 2021, the Company issued 18,601 common stock warrants in conjunction with the Term Loan and Credit Facility between the Company and Silicon Valley Bank. These warrants are exercisable for shares of common stock at $8.85 per share and expire in June 2031. The common stock warrants are valued using the BSM option pricing model. The warrants are not remeasured in future periods as they meet the conditions for equity classification. In June 2021, the Company entered into a warrant purchase agreement with SQN Venture Income Fund II, LP to issue 90,948 warrants to purchase Common Stock in conjunction with entering into the June 2021 Credit Facility. The exercise price of these Common Stock warrants is $8.85 per share. The Company concluded that the common stock warrants are liability classified and shall be measured at fair value at grant date using the BSM option pricing model and subsequently remeasured at each reporting date. In October 2021, the Company issued 402,955 common stock warrants to an existing investor pursuant to negotiations with the investor to consider continued future investment. These warrants are exercisable for shares of common stock commencing the earliest of (i) the closing date of an initial public offering, or (b) the date of the Company’s completion of a transaction or series of related transactions (by merger, or consolidation, share exchange or otherwise) with a publicly traded special purpose acquisition company or its subsidiary. The warrant exercise price is $16.54 per share and the warrants expire in October, 2024. The warrants were measured at fair value on the issuance date. On January 20, 2022, in conjunction with the LSA, the Company entered into warrant agreements with the various lenders involved under the LSA to issue a certain number of warrants to purchase stock based on the percentage of each tranche borrowing exercisable for the Company’s stock at the lowest of (i) $2.82 per share, (ii) the lowest price per share the Company receives for a share of stock, and (iii) the lowest price the Company receives for a share of future round of stock. On August 25, 2022, the Company entered into an amended and restated warrant agreement for the October 2021 warrants, which amended and restated that the warrants to purchase shares of common stock provide for the automatic conversion, with an amended exercise price of zero, of such warrant into shares of Tempo common stock upon the consummation of the business combination, a business combination or similar transaction with another special purpose acquisition company, the consummation of a qualified financing or the consummation of an initial public offering or direct listing. The amended common stock warrants are liability-classified instruments under ASC 815-40 due to these not being indexed to the Company’s equity. On August 25, 2022, the Company entered into a warrant purchase agreement with existing investors to issue 3,114,193 warrants to purchase common stock in conjunction with entering into various loans. The exercise price of these common stock warrants is $16.54 per share and upon a change in control transaction, the exercise price of these warrants resets to $0. The Company concluded that the common stock warrants are liability classified and shall be measured at fair value at grant date using the BSM option pricing model and subsequently remeasured at each reporting date. The fair value at time of issuance was $27.6 million and was recognized as an other financing cost in the consolidated statement of operations, as the excess of the fair value of the warrants over the proceeds received resulted in an up-front expense given that no other transaction element of value was identified. Upon the Closing, on November 22, 2022, Tempo used its commercially reasonable efforts to cause the holder of each outstanding and unexercised warrant of Tempo to exercise such warrants in exchange for shares of Tempo common stock. Each Tempo warrant that remained outstanding and unexercised was converted into a New Tempo warrant at the Exchange Ratio. The exercise of such warrants resulted in the issuance of 3,679,148 Tempo common shares. The fair value of Tempo’s existing liability classified warrants was removed when exercised. The warrants were exercised via the “cashless” exercise provision. With the Merger, the Company assumed 11,499,987 public warrants and 6,600,000 private warrants from ACE. The public warrants and private warrants were accounted for by the Company as equity classified warrants and liability classified warrants, respectively. Equity Classified Warrants The following warrants assumed from ACE were outstanding as of December 31, 2022: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 11,499,987 $ 11.50 7/27/2020 11/21/2027 The following warrants were outstanding as of December 31, 2021: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 31,121 $ 5.51 6/3/2020 6/3/2030 Common Stock 18,601 8.85 6/23/2021 6/22/2031 Common Stock 402,955 16.54 10/11/2021 10/11/2024 452,677 Liability Classified Warrants As of December 31, 2022, the Company has the following liability-classified warrants outstanding: Warrants to purchase # of Shares Exercise Price Issuance Date Expiration Date Common Stock 6,572 $ 16.17 10/13/2017 10/13/2027 Common Stock 4,759,536 $ 11.50 7/27/2020 11/21/2027 Common Stock 468,750 $ 11.50 7/27/2020 11/21/2027 Common Stock 891,714 $ 11.50 7/27/2020 11/21/2027 Common Stock 480,000 $ 11.50 7/27/2020 11/21/2027 6,606,572 Warrants which are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the Company’s consolidated balance sheets. At December 31, 2022, above list of warrants are valued using the active observable market quote. The warrant liability, therefore, represents a Level 1 measurement within the ASC 820 fair value measurement hierarchy, as on December 31, 2022. The following table details the changes in fair value of the liability-classified warrants, for the year ended December 31, 2022 (in thousands): Fair Value Warrants outstanding - January 1, 2022 $ 5,573 Warrants issued and modified 32,514 Assumed from ACE upon Closing 1,122 Exercised or converted to common stock upon Closing (38,389) Change in fair value, net (431) Warrants outstanding – December 31, 2022 $ 389 As of December 31, 2021, the Company has the following liability-classified warrants outstanding: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 10,016 $ 6.74 11/24/2015 11/24/2025 Common Stock 4,453 6.74 11/22/2016 11/22/2026 Common Stock 6,573 16.19 10/13/2017 10/13/2027 Common Stock 18,417 5.51 1/29/2021 1/29/2031 Common Stock 90,948 8.85 6/24/2021 6/24/2031 130,407 As of December 31, 2021, and previous reporting periods, the liability-classified warrants are remeasured on a recurring basis, primarily based on observable market data while the related theoretical warrant volatility assumption within the BSM option pricing model represents a Level 3 measurement within the ASC 820 fair value measurement hierarchy. The following table details the changes in fair value of the liability-classified warrants, for the year ended December 31, 2021 (in thousands): Fair Value Warrants outstanding – January 1, 2021 $ 86 Warrants issued and modified 1,245 Change in fair value, net 4,242 Warrants outstanding – December 31, 2021 $ 5,573 The change in fair value, net as shown in the table above is recorded as change in fair value of warrant liability in the consolidated statements of operations. For warrants revalued during the period, the warrants were valued using a Black-Scholes valuation model which considers the value of the instruments under a SPAC scenario and a non-SPAC scenario, using the following assumptions: December 31, 2021 Expected term 3.89 – 9.48 years Expected volatility 64.29% – 64.44 % Risk-free interest rate 1.12% – 1.52% Expected dividends 0 % |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation | |
Stock-Based Compensation | (9) Stock-Based Compensation Amended And Restated 2015 Equity Incentive Plan In April 2015, the board of directors of Tempo prior to the Merger (“Legacy Tempo”) adopted the 2015 Equity Incentive Plan (“the 2015 Plan”), which was subsequently approved by the Company’s stockholders. The 2015 Plan was terminated in connection upon the Closing, and accordingly, no shares are currently available for grant under the 2015 Plan. The 2015 Plan continues to govern outstanding awards granted thereunder. The 2015 Plan permits the granting of incentive stock options, non-statutory stock options, and restricted stock to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to employees and consultants, and to promote the success of the Company’s business. The board of directors, at its sole discretion, shall determine the exercise price but subject to certain terms in the Plan. Options granted under the 2015 Plan expire 10 years from the date of grant. First time grants of incentive stock options and non-statutory options generally vest at a rate of 25% on the first anniversary of the grant date and then ratably monthly over the next three years. Upon termination of employment, any unvested options are automatically returned to the Company. In general, vested options that were not exercised within three months after termination are surrendered back to the Company. In general, the awards issued by the Company are service based options, however, in July 2020, the Company issued 258,368 performance-based options to the chief financial officer of the Company which vest 100% subject to the occurrence of a qualified transaction within 36 months of its date of grant. Additionally, in March 2021, the Company issued 1,245,641 performance-based options to management employees and board of directors which vest 100% subject to the occurrence of a qualified transaction. In November 2021, the Company’s board of directors approved to (i) reduce the July 2020 grant achievement period by approximately six months; and (ii) extend the March 2021 grants achievement period by 12 months. During the three months ended December 31, 2022, the performance condition was achieved for 1,071,909 options, or 182,787 post-Merger common stock, and therefore vested. An additional 127,056 options, or 21,667 post-Merger common stock, will vest monthly over the next twelve months. The Company recognized expense associated with these options in the amount of $6.4 million for the year ended December 31, 2022. The unrecognized expense associated with the remaining options is $0.7 million as of December 31, 2022. In March 2022, one of the Company’s executives was terminated and the 330,708 unvested options were modified to include a performance condition. The unvested options will vest upon a change of control within three months of the modification date. As of June 30, 2022, the performance condition was not met. As a result, no stock-based compensation was recorded and the unvested options were forfeited during the three months ended June 30, 2022. In August 2022, the Company’s board of directors approved the (i) modification of 867,461 unvested service-based options of three terminated executives to include a performance condition; (ii) cancellation of 254,113 performance options issued in March 2021 and (iii) modification of 50,931 performance options granted in March 2021 to reduce the grant achievement period to November 2022. In November 2022, management determined the performance condition for the 918,392 modified performance options was not met. As a result, no stock-based compensation was recorded, and the unvested options were forfeited during the three months ended December 31, 2022. 2022 Incentive Award Plan In November 2022, the board of directors adopted the 2022 Incentive Award Plan (“the 2022 Plan”), which was subsequently approved by the Company’s stockholders. The 2022 Plan provides that the initial aggregate number of shares of common stock available for issuance shall be the sum of (i) 12% of the total number of issued and outstanding shares of common stock on a fully diluted basis as of the Closing, which the Board has determined to be 3,896,412 shares of common stock (the “Initial Plan Reserve”) and (ii) an annual increase on the first day of each calendar year beginning on and including January 1, 2023 and ending on and including January 1, 2032, equal to the lesser of (A) a number equal to five percent (5%) of the aggregate number of shares of common stock outstanding on the final day of the immediately preceding calendar year and (B) such smaller number of shares of common stock as is determined by the Board (the “2022 Plan Evergreen Increase”). The 2022 Plan permits the granting of incentive stock options, restricted stock, restricted stock unit, cash-based awards and stock appreciation rights to attract, retain and motivate persons who make (or are expected to make) important contributions to the Company by providing these individuals with equity ownership opportunities and/or equity-linked compensatory opportunities. The board of directors, at its sole discretion, will establish each option’s and stock appreciation right’s exercise price and specify the exercise price in the award agreement of each holder. Options and stock appreciation rights granted under the 2022 Plan expire 10 years from the date of grant. First time grants of incentive stock options and non-statutory options generally vest at a rate of 25% on the first anniversary of the grant date and then ratably monthly over the next three years. Upon termination of employment, any unvested options are automatically returned to the Company. In general, vested options that were not exercised within three months after termination are surrendered back to the Company. These options are added back to the Plan and made available for future grants. As of December 31, 2022, there were 2,639,329 common shares, available for issuance under the 2022 Plan. Restricted Stock Unit Issuance On September 9, 2022, Tempo issued 9,500,000 retention awards in the form of restricted stock units of Tempo (“Tempo RSUs”) to certain eligible employees and directors of Tempo. On September 23, 2022, ACE and Tempo entered into the Second Amendment to the Amended and Restated Agreement and Plan of Merger, pursuant to which the parties agreed, among other things, that all awards of Tempo RSUs that are outstanding at the closing of the Business Combination will, at the Effective Time, be converted into (a) restricted stock unit awards covering shares of Tempo common stock (“Tempo RSUs”) and (b) the right to receive a number of Tempo Earnout Shares. Out of the above approved and issued RSUs, 4,750,000 RSUs were subject to service-based conditions which shall vest at a rate of 33.33% on the first anniversary of the grant date and then ratably quarterly over the next two years. The Company recorded $29 thousand in compensation expense for these service-based RSUs for the year ended December 31, 2022. The remaining 4,750,000 RSUs were subject to performance-based conditions, 50% of which will vest upon achieving $15.0 million in quarterly revenue of Tempo and the remaining 50% will vest upon achieving $5.0 million in adjusted EBITDA of Tempo. The total fair value of these performance based RSUs was $4.3 million as of the issuance date of September 27, 2022. The Company recorded no compensation expense for these performance based RSUs for the year ended December 31, 2022 as achievement of the vesting condition was not deemed probable of occurring. Option and RSU Activity A summary of cumulative option activity under the 2015 Plan and the 2022 Plan is as follows: Options outstanding Weighted Weighted average average Aggregate Number of exercise price contractual term intrinsic value shares per share (in years) (in thousands) Outstanding – January 1, 2022 16,457,475 $ 1.36 7.96 $ 104,554 Retrospective application of recapitalization (13,651,211) 6.85 Adjusted balance – beginning of period 2,806,264 8.21 7.96 104,554 Options granted 705,520 6.85 Options exercised (8,184) 6.01 Options forfeited (713,205) 13.33 Options expired (36,196) 6.92 Outstanding – December 31, 2022 2,754,199 4.73 7.46 77 Vested during the period 627,299 9.25 6.75 — Vested at end of period 1,894,115 6.52 5.69 77 Exercisable at the end of the period 1,894,115 6.52 5.69 77 Shares expected to vest 860,064 5.24 9.20 — Vested and expected to vest 2,549,745 6.26 6.71 77 The following is a summary of the 2015 Plan RSU activity for the year ending December 31, 2022: Weighted- Number of Awards Average Outstanding Grant Date Fair Value Unvested Balance – January 1, 2022 — $ — Granted 1,662,620 22.25 Forfeited (42,630) 22.59 Unvested Balance – December 31, 2022 1,619,990 22.25 Determination of Fair Value The Company estimates the fair value of share-based compensation for stock options and restricted stock units utilizing the BSM option pricing model, which is dependent upon several variables, discussed below. These amounts are estimates and, thus, may not be reflective of actual future results, nor amounts ultimately realized by recipients of these grants. The Company recognizes compensation using the straight-line basis over the requisite service period, which is generally the vesting period of the respective award. Fair Value of Common Stock: Expected Term: Expected Volatility: Risk-Free-Interest-Rate: Expected Dividend: The following assumptions were used to calculate the fair value of options granted during the year ended December 31, 2022: During the Year Ended December 31, 2022 Expected term 0.50 – 6.00 years Expected volatility 55.92% – 70.39% Risk-free interest rate 1.54% – 3.71% Expected dividends 0% Stock-Based Compensation Expense The following table summarizes stock-based compensation expense and its allocation within the accompanying consolidated statements of operations during the years ended December 31, 2022 and 2021 (in thousands): 2022 2021 Cost of goods sold $ 501 $ 276 Research and development 1,615 540 Sales and marketing 465 402 General and administrative 8,708 1,320 Total stock-based compensation expense $ 11,289 $ 2,538 As of December 31, 2022, there were a total of $3.4 million and $6.9 million of unrecognized employee compensation costs related to service-based options and RSUs, respectively. Such compensation cost is expected to be recognized over a weighted-average period of approximately 2.49 years and 2.69 years for service-based options and RSUs, respectively. As of December 31, 2022, there were a total of $0.7 million of unrecognized employee compensation costs related to performance-based options. Such compensation cost is expected to be recognized over a weighted-average period of approximately 0.95 years for performance-based options. Earnout Shares During the period from the date of the Merger through December 31, 2022, the Company did not record stock-based compensation expense associated with the 1,824,463 Earnout Shares issued concurrently with the Merger as the performance conditions associated with the Earnout Shares were not deemed probable of achievement. Unrecognized stock-based compensation expense for Earnout Shares with a performance-based vesting condition that was not deemed probable of occurring as of December 31, 2022, is $2.1 million which is expected to vest subject to the performance-based vesting condition being satisfied or deemed probable. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | (10) Commitments and Contingencies Operating Leases The table below presents the operating lease-related assets and liabilities recorded on the consolidated balance sheets (in thousands): Classifications on the financial statements As of December 31, 2022 Operating lease assets Operating leases – right-of-use asset $ 371 Operating lease liability, current Operating lease liability, current 516 Operating lease liability, noncurrent Operating lease liability, noncurrent 30 Classifications on the financial statements As of December 31, 2021 Operating lease assets Operating leases– right-of-use asset $ 1,323 Operating lease liability, current Operating lease liability, current 1,111 Operating lease liability, noncurrent Operating lease liability, noncurrent 546 The estimated incremental borrowing rate used to measure the lease liability is 8.95%. Prospectively, future rent expense under ASC 842 is calculated using the same methodology as required under ASC 840 in order to record straight line lease expense over the lease term. Rent expense recorded was $1.0 million for the years ended December 31, 2022 and 2021. Variable lease expenses for the years ended December 31, 2022 and 2021 were immaterial. On August 8, 2022, the Company abandoned a section of their operating lease for the remainder of the lease term and has no intention of subleasing the space. The Company reassessed their asset grouping as the deployment of the ROU asset had changed and determined the abandoned lease was a new asset group. The Company concluded the abandoned section of their ROU asset was not recoverable and recognized an impairment charge of $0.1 million to the right of use asset, and a $0.2 million impairment charge to the leasehold improvements. These impairment charges were recorded within impairment loss in the consolidated statements of operations. Future minimum lease payments under non-cancelable operating leases as of December 31, 2022 are as follows (in thousands): As of December 31, 2022 2023 $ 531 2024 29 Total future lease payments 560 Less imputed interest (14) Total operating lease liability $ 546 Finance Leases The table below presents the finance lease-related assets and liabilities recorded on the consolidated balance sheets and the consolidated statements of operations (in thousands): Classification on the financial statements December 31, 2022 Finance lease assets Property and equipment, net $ 3,383 Finance lease liability, current Finance lease, current 1,606 Finance lease liability, noncurrent Finance lease, noncurrent — Depreciation of the leased asset Cost of revenue 2,072 Lease interest expense Other income (expense), net 414 Classification on the financial statements December 31, 2021 Finance lease assets Property and equipment, net $ 3,943 Finance lease liability, current Finance lease, current 1,091 Finance lease liability, noncurrent Finance lease, noncurrent 1,606 Depreciation of the leased asset Cost of revenue 547 Lease interest expense Other income (expense), net 598 Future minimum lease payments under finance lease are as follows (in thousands): As of December 31, 2022 2023 $ 1,731 Total future lease payments 1,731 Less: imputed interest (125) Total finance lease liability $ 1,606 The weighted average remaining lease term for our operating leases and finance leases is 0.6 years and 0.5 years, respectively and the weighted average discount rate of our operating leases and finance leases is 8.95% and 18.71%, respectively. Supplemental disclosures of cash flow information related to leases were as follows (in thousands): Years Ended December 31, 2022 2021 Operating cash flows paid for operating leases $ 1,215 $ 1,184 Financing cash flows paid for finance leases 1,504 1,504 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Income Taxes | (11) Income Taxes The components of the Company’s provision for income taxes for the years ended December 31, 2022 and 2021 is as follows (in thousands): Years Ended December 31, 2022 2021 Current: Federal $ — $ — State — — Total current tax expense $ — $ — The following reconciles income tax expense computed at the federal statutory rate with income tax expense as reported: Years Ended December 31, 2022 2021 Statutory rate 21.0 % 21.0 % Federal net operating loss — % — % Leases — % — % Depreciation — % — % State income tax 1.6 % 9.6 % Permanent differences (12.6) % (6.8) % Other — % — % Valuation allowance (10.0) % (23.8) % Effective income tax rate 0.0 % 0.0 % The significant components of the Company’s deferred tax asset (liability) as of December 31, 2022 and 2021 are as follows: Years Ended December 31, 2022 2021 Deferred tax assets Net operating losses $ 34,780 $ 26,070 Stock options and Warrants 3,107 — Property, plant and equipment and intangibles 2,620 — Accruals and other 1,041 982 Total deferred tax assets 41,548 27,052 Less valuation allowance (40,333) (25,648) Net deferred tax assets 1,215 1,404 Deferred tax liabilities Property, plant, equipment, and intangibles (1,125) (1,017) Lease liability (90) (387) Total deferred tax liabilities (1,215) (1,404) Net deferred tax assets (liabilities) $ — $ — As of December 31, 2022, the Company had net operating loss carryforwards of approximately $128.7 million and $121.9 million for federal and state income tax purposes, respectively. The federal and state net operating loss carryforwards begin to expire in 2027 and 2028 respectively. Federal NOLs that arose on or after January 1, 2018 can be carried forward indefinitely against future income but can only be used to offset a maximum of 80% of the Company’s federal taxable income in any year. The Company has established a valuation allowance for U.S. federal and state deferred tax assets. The valuation allowance requires an assessment of both positive and negative evidence when determining whether it is more likely than not that deferred tax assets are recoverable. Such assessment is required on a jurisdiction-by-jurisdiction basis. The Company intends to maintain a full valuation allowance until sufficient positive evidence exists to support reversal. The valuation allowance for deferred tax assets was $40.3 million and $25.6 million as of December 31, 2022 and 2021, respectively. The change in valuation allowance of $14.4 million and $11.4 million in 2022 and 2021, respectively, is primarily related to the Company’s activities that give rise to a net operating loss carryover. The unrecognized tax benefit is related to the Company’s reserves on Federal and California research and development tax credits. For the years ended December 31, 2022 and 2021, the activity related to the unrecognized tax benefits is as follows (in thousands): Years Ended December 31, 2022 2021 Unrecognized tax benefits, beginning of period $ 411 $ 411 Additions based on tax positions related to current year — — Reductions based on tax positions related to prior years — — Unrecognized tax benefits, end of period $ 411 $ 411 The Company is currently unaware of any uncertain tax positions that could result in significant additional payments, accruals, or other material deviation in the next 12 months. The Inflation Reduction Act of 2022 (“IRA”) was passed and signed into law in August 2022, which contains various corporate income tax provisions, including a 15% corporate minimum tax, a 1% excise tax on stock repurchases, and new renewable energy tax credit regime. The Company is still analyzing the impact of such provisions but does not anticipate a material impact as a result of its passage. Under the Tax Cuts and Jobs Act, research and development expenditures are no longer fully deductible and are required to be capitalized and amortized under Section 174 of the Internal Revenue Code in tax years beginning on or after January 1, 2022. The capitalized research expenses must be amortized over five years for research performed in the U.S. and 15 years for research performed outside the U.S. The mandatory capitalization requirement increased the Company’s deferred tax assets, which were fully offset by a valuation allowance. The federal and state net operating loss carryforwards may be subject to significant limitations under Section 382 and Section 383 of the Internal Revenue Code and similar provisions under state law. Federal tax legislation enacted in December 2017, commonly known as the Tax Cuts and Jobs Act, contains provisions that limit the federal net operating loss carryforwards that may be used in any given year in the event of special occurrences, including significant ownership changes. A Section 382 “ownership change” generally occurs if one or more stockholders or groups of stockholders, who own at least 5% of the Company’s stock, increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period.The Company performed a formal Section 382 study analysis through December 31, 2022, and determined that a Section 382 “ownership change” occurred on November 22, 2022, in connection with the closing of the Merger. Based on the formal Section 382 study analysis prepared, federal net operating losses incurred by the Company through December 31, 2021 are not expected to be limited under Section 382, however any net operating losses generated in fiscal year 2022 could be subject to limitation. |
Net Loss Per Share
Net Loss Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Net Loss Per Share | |
Net Loss Per Share | (12) Net Loss Per Share No dividends were declared or paid for the years ended December 31, 2022 and 2021. Undistributed earnings for each period are allocated to participating securities for the applicable periods, based on the contractual participation rights of the security to share in the current earnings as if all current period earnings had been distributed. The Company’s basic net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average shares of common stock outstanding during periods with undistributed losses. The table below sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except share data and per share amounts): Years ended December 31, 2022 2021 Basic and diluted: Net loss $ (144,851) $ (48,013) Weighted-average number of shares of common stock outstanding 8,843,703 6,708,466 Basic and diluted net loss per share $ (16.38) $ (7.16) Basic and diluted net loss per share attributable to common stockholders is the same for the years ended December 31, 2022 and 2021 because the inclusion of potential shares of common stock would have been anti-dilutive for the periods presented. The following table presents the potential common shares outstanding that were excluded from the computation of diluted net loss per share of common stock as of the periods presented because including them would have been antidilutive: As of December 31, 2022 2021 Shares of common stock issuable from stock options and RSUs 4,374,189 2,806,264 Shares of common stock issuable from common stock warrants 18,106,559 583,084 Potential common shares excluded from diluted net loss per share 22,480,748 3,389,348 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events | |
Subsequent Events | (13) Subsequent Events Alameda Lease Extension On February 16, 2023, the Company entered into a three Silicon Valley Bank Closure Silicon Valley Bank was closed on March 10, 2023 by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver. The FDIC transferred all deposits to a newly created bridge bank, named Silicon Valley Bridge Bank, N.A. (“SVBB”). At the time of closing, the Company maintained substantially all of its cash and cash equivalents in deposit accounts with Silicon Valley Bank. The Company did not have any lending relationships with Silicon Valley Bank at the time of closing. On March 12, 2023, the U.S. Treasury, Federal Reserve, and FDIC announced that Silicon Valley Bank depositors will have access to all their money starting March 13, 2023. The Company was able to access all of its funds at SVBB and has since transitioned its primary banking relationship to a national banking institution. The Company does not expect that the closure of Silicon Valley Bank will have an impact on the Company’s financial position and results from operations. Optimum Merger Agreement On March 25, 2023, the Company entered into a Securities Purchase Agreement to acquire all the outstanding equity of Optimum Design Associates, Inc. and Optimum Design Associates Pty. Ltd. (together “ODA”) for consideration of up to $6.8 million in cash, to be paid in three installments over one year , 4,400,000 shares of common stock, to be awarded within five days of the closing date of the Securities Purchase Agreement, and up to $7.5 million in additional consideration, to be awarded in the future dependent on the financial performance of ODA. The Company continues to assess the total impact of the acquisition as of the filing date. White Lion Stock Purchase Agreement Subsequent to December 31, 2022, the Company issued 350,000 shares of common stock to White Lion in exchange for $0.3 million in proceeds. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act, until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that the Company (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, the Company’s financial statements may not be comparable to financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards based on public company effective dates. The Company will remain an emerging growth company under the JOBS Act until the earliest of (i) the last day of our first fiscal year following the fifth anniversary of the closing of ACE’s initial public offering, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (iii) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three-years. |
Basis of presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”). References to ASC and ASU included herein refer to the Accounting Standards Codification and Accounting Standards Update established by the Financial Accounting Standards Board (“FASB”) as the source of authoritative U.S. GAAP. The financial statements include all of the accounts of the Company and all intercompany balances and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year presentation of our consolidated financial statements. These reclassifications had no effect on the Company’s reported consolidated results of operations. |
Liquidity and Going Concern | Liquidity and Going Concern The Company has experienced negative cash flows from operations since inception and expects negative cash flows from operations to continue for the foreseeable future. The Company had an accumulated deficit of $253.2 million, cash, cash equivalents and restricted cash of $7.4 million , and a working capital deficiency of $31.1 million as of December 31, 2022. During the year ended December 31, 2022, the Company used net cash of $28.8 million in operating activities and incurred a net loss of $144.9 million. Additionally, as of the date these financial statements were available for issuance, the Company has approximately $3.2 million of contractual loan principal payments and finance lease obligations coming due within the next 12 months and the Company was not in compliance with its outstanding debt covenants under the A&R LSA (as defined in Note 5). These conditions exist that raise substantial doubt about the Company’s ability to continue as a going concern. In order to fund planned operations while meeting obligations as they come due, the Company will need to secure additional debt or equity financing. However, there can be no assurance that the Company will be able to obtain such funding on terms acceptable to the Company, on a timely basis or at all, particularly in light of the Company’s current stock price and liquidity. As a result, substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date that the financial statements are available to be issued. Failure to secure additional funding may require the Company to modify, delay, or abandon some of its planned future expansion or development, or to otherwise enact additional operating cost reductions available to management, which could have a material adverse effect on the Company’s business, operating results, financial condition, and ability to achieve its intended business objectives. The accompanying audited financial statements have been prepared in conformity with U.S. GAAP, assuming the Company will continue as a going concern and do not include adjustments that might result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course. |
Use of estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and accompanying notes. Those estimates and assumptions include, but are not limited to, revenue recognition and deferred revenue; allowance for doubtful accounts; share-based compensation; determination of fair value of our debt; determination of fair value of embedded derivatives; determination of fair value of our warrants; accounting for income taxes, including the valuation allowance on deferred tax assets and reserves for uncertain tax positions; accrued liabilities; and the recognition and measurement of earnout liabilities. We evaluate our estimates and assumptions on an ongoing basis using historical experience and other factors and adjust those estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ from these estimates, and those differences could be material to the financial statements. |
Risks and Uncertainties & Covid-19 Impact | Risks and Uncertainties The Company is subject to a number of risks. The Company conducts business in a dynamic high technology industry and believes that changes in any of the following areas could have a material adverse effect on its future financial position, results of operations, or cash flows: advances and trends in new technologies and industry standards; pressures resulting from new applications offered by competitors; delays in applications and functionality development; changes in certain strategic relationships or customer relationships; the Company’s ability to attract new customers or retain existing customers; the length of the Company’s sales cycles and expense related to sales efforts; litigation or claims against the Company based on intellectual property, patent, product, regulatory, or other factors; changes in domestic and international economic or political conditions or regulations; the ability of the Company to finance its operations; and the Company’s ability to attract and retain employees necessary to support its growth. Additionally, the COVID-19 pandemic has negatively impacted the global economy, disrupted supply chains, constrained work force participation, and created significant volatility and disruption of financial markets. Further, the Company faces risks with respect to the inflationary environment in the country and the related fluctuations in interest as well as currency exchange rates. As the scope and duration of these events are unknown and the extent of its economic impact continues to evolve globally, there is uncertainty related to the ultimate impact it will have on the Company’s business, its employees, results of operations and financial condition. COVID-19 Impact On March 11, 2020, the World Health Organization declared that the worldwide spread and severity of a new coronavirus, referred to as COVID-19, was severe enough to be characterized as a pandemic. In response to the continued spread of COVID-19, governmental authorities around the world have imposed various restrictions designed to slow the pace of the pandemic, including restrictions on travel and other restrictions that prohibit employees from going to work causing severe disruptions in the worldwide economy. The COVID-19 pandemic has had and may continue to have an adverse impact on the Company’s employees, operations, supply chain and distribution system. If the Company’s suppliers experience additional closures or reductions in their capacity utilization levels in the future, the Company may have difficulty sourcing materials necessary to fulfill production requirements. Due to the COVID-19 pandemic, Tempo has experienced some supply chain constraints, including with respect to semiconductor components, and has responded by ordering larger quantities of these components to ensure an adequate supply. COVID-19 has also impacted the Company’s customers and may create unpredictable reductions or increases in demand for Tempo’s manufacturing services. Management will continue to monitor the impact of the global situation on the Company’s financial condition, cash flows, operations, industry, workforce, and customer relationships. |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Contract Balances The timing of revenue recognition, billings and cash collections can result in deferred revenue (contract liabilities), unbilled receivables (contract assets), and billed accounts receivable. a. Contract Liabilities A contract liability results when payments from customers are received in advance for assembly and manufacturing of the goods. The Company recognizes contract liabilities as revenues upon satisfaction of the underlying performance obligations. Deferred revenue that is expected to be recognized as revenue during the subsequent twelve-month period from the date of billing is recorded in contract liabilities and the remaining portion, if any, is recorded in contract liabilities, noncurrent on the accompanying consolidated balance sheets at the end of each reporting period. For the years ended December 31, 2022 and 2021, the Company recognized revenue of $0.1 million that was included in the contract liabilities balance at the beginning of the related periods, respectively. b. Contract Assets Billings scheduled to occur after the performance obligation has been satisfied and revenue recognition has occurred result in contract assets. Unbilled receivables that are expected to be billed during the subsequent twelve-month period from the date of revenue recognition are recorded in contract assets, and the remaining portion, if any, is recorded in other noncurrent assets on the accompanying consolidated balance sheets at the end of each reporting period. Unbilled receivables represent amounts for which the Company has recognized revenue, pursuant to its revenue recognition policy, for services already performed, but billed in arrears and for which the Company believes it has an unconditional right to payment. Below are the accounts receivables, contract assets, and contract liabilities (in thousands): December 31, December 31, 2022 2021 Accounts receivable, net $ 2,633 $ 2,918 Contract assets 233 1,219 Contract liabilities 2,595 175 |
Cost of Revenue | Cost of Revenue Cost of revenue primarily includes direct materials, direct labor, and manufacturing overhead incurred for revenue-producing units shipped. Cost of revenue also includes associated warranty costs, shipping and handling, stock-based compensation and other miscellaneous costs. |
Research and Development | Research and Development Research and development costs are expensed as incurred and consist primarily of personnel and related costs for product development activities. Research and development costs also include professional fees payable to third parties, license and subscription fees for development tools, manufacturing-related costs associated with product development and stock-based compensation. |
Sales and marketing expense | Sales and marketing expense Sales and marketing expenses consist of personnel and related expenses for our employees working in sales and marketing and business development departments including salaries, bonuses, payroll taxes, and stock-based compensation. Also included are non-personnel costs such as marketing activities, professional and other consulting fees. |
General and administrative expense | General and administrative expense General and administrative expenses consist primarily of personnel and related expenses for our employees in our finance and administrative teams including salaries, bonuses, payroll taxes, and stock-based compensation. It also consists of legal, consulting, and professional fees, rent expenses pertaining to our offices, business insurance costs and other costs. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred. These amounts are included in the selling and marketing expense in the accompanying consolidated statements of operations. Advertising costs were $0.3 million and $0.5 million for the years ended December 31, 2022 and 2021, respectively. |
Concentration of Risks | Concentration of Risks Concentration of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, and accounts receivable. The Company’s cash and cash equivalents and restricted cash are on deposit with major financial institutions. Such deposits may be in excess of insured limits. The Company believes that the financial institutions that hold the Company’s cash are financially sound, and accordingly, minimum credit risk exists with respect to these balances. The Company has not experienced any losses due to institutional failure or bankruptcy. The Company performs credit analyses and monitors the financial health of its customers to reduce credit risk. The Company reviews accounts receivable balances to determine if any receivables will potentially be uncollectible and includes any amounts that are determined to be uncollectible in the allowance for doubtful accounts. As of December 31, 2022, there was one customer who had outstanding balances accounting for 61% of the total accounts receivable balance. As of December 31, 2021, there was one customer who had outstanding balance accounting for 49% of the total accounts receivable balance. Concentration of customers For the year ended December 31, 2022, two customers represented 21% and 20% of revenue, respectively. For the year ended December 31, 2021, one customer represented 46% of revenue. |
Segment Reporting and Geographic Information | Segment Reporting and Geographic Information For the years ended December 31, 2022 and 2021, the Company was managed as a single operating segment in accordance with the provisions in the FASB guidance on segment reporting, which establishes standards for, and requires disclosure of, certain financial information related to reportable operating segments and geographic regions. Furthermore, the Company determined that the Chief Executive Officer is the Chief Operating Decision Maker as she is responsible for making decisions regarding the allocation of resources and assessing performance as well as for strategic operational decisions and managing the organization as a whole. Substantially all of the Company’s revenues are domestic sales and fixed assets are physically located in the United States. |
Cash and Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash The Company considers all highly liquid securities that mature within three months or less from the original date of purchase to be cash equivalents. The Company maintains the majority of its cash balances with commercial banks in interest bearing accounts. Cash and cash equivalents include cash held in checking and savings accounts and highly liquid securities with original maturity dates of three months or less from the original date of purchase. Cash equivalents consisted of $7.0 million and $2.6 million in money market accounts as of December 31, 2022 and 2021, respectively. The restricted cash balance as of both December 31, 2022 and 2021 represents $0.3 million related to a letter of credit for the Company’s office space lease. As of December 31, 2022 2021 Cash and cash equivalents $ 7,113 $ 2,864 Restricted cash 320 320 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 7,433 $ 3,184 |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable, net is recorded at the invoiced amount, net of allowance for doubtful accounts. The allowance is based upon historical losses and an evaluation of the potential risk of loss associated with delinquent accounts. The Company evaluates the need for an allowance for doubtful accounts for estimated probable losses at each period end. Accounts receivable deemed uncollectable are charged against the allowance for doubtful accounts when identified. The Company recorded an allowance for doubtful accounts of $0.2 million and $0.4 million and as of December 31, 2022 and 2021, respectively. |
Inventory | Inventory Inventory consists of raw materials and work-in-progress representing the components that the Company produces. The Company uses actual cost to value inventory. In general, the Company procures materials from suppliers when a purchase order is received from its customers. The Company identifies these procured materials as raw material if work on the purchase order has not commenced and for any work that has been started on the materials procured are identified as work-in-progress. |
Long-Lived Assets | Long-Lived Assets Long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that their net book value may not be recoverable. If the sum of the expected future cash flows (undiscounted and before interest) from the use of the assets is less than the net book value of the asset an impairment could exist and the amount of the impairment loss, if any, will generally be measured as the difference between the net book value of the assets and their estimated fair values. During the year ended December 31, 2022, the Company abandoned a portion of its leased space and recorded an impairment charge of $0.3 million to leasehold improvements and ROU assets during the year ended December 31, 2022 (see Note 10). |
Fair Value Option ("FVO") Election | Fair Value Option (“FVO”) Election The Company accounts for certain loan and security borrowings outstanding under the fair value option election of ASC 825, Financial Instruments (“ASC 825”) as discussed below. The loan and security borrowings accounted for under the FVO election are each debt host financial instruments containing embedded features, some of which would otherwise be required to be bifurcated from the debt-host and recognized as separate derivative liabilities subject to initial and subsequent periodic estimated fair value measurements under ASC 815. Notwithstanding, ASC 825-10-15-4 provides for the FVO election, to the extent not otherwise prohibited by ASC 825-10-15-5, to be afforded to financial instruments, wherein bifurcation of an embedded derivative is not necessary, and the financial instrument is initially measured at its issue-date estimated fair value and then subsequently remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value adjustment, as required by ASC 825-10-45-5, is recognized as a component of other comprehensive income (“OCI”) with respect to the portion of the fair value adjustment attributed to a change in the instrument-specific credit risk, with the remaining amount of the fair value adjustment recognized as other income (expense) in the accompanying consolidated statements of operations. With respect to the above loan and security borrowings, the estimated fair value adjustment is presented as change in fair value of debt within other income (expense) in the accompanying consolidated statements of operations, since the change in fair value of the loan and security borrowings payable was not attributable to instrument specific credit risk during the year ended December 31, 2022. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net is stated at cost less accumulated depreciation and amortization. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gain or loss is included in the current period. Repair and maintenance costs are expensed as incurred. Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets (in years): Useful Lives Computer equipment 3 Software 5 Furniture and fixtures 3 Leasehold improvements Shorter of useful life or remaining lease term Manufacturing equipment 10 |
Income Taxes | Income Taxes The Company uses the asset-and-liability method for income taxes. Under this method, deferred tax assets and liabilities are determined based on differences between the financial statement carrying amounts and tax bases of assets and liabilities and operating loss and tax credit carryforwards and are measured using the enacted tax rates that are expected to be in effect when the differences reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to an amount that, in the opinion of management, is more likely than not to be realized. The Company accounts for uncertain tax positions based on an evaluation as to whether it is more likely than not that a tax position will be sustained on audit, including resolution of any related appeals or litigation processes. This evaluation is based on all available evidence and assumes that the appropriate tax authorities have full knowledge of all relevant information concerning the tax position. The tax benefit recognized is based on the largest amount that is greater than 50% likely of being realized upon ultimate settlement. The Company includes interest expense and penalties related to its uncertain tax positions in interest expense and other expense, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company has a stock incentive plan under which incentive stock options and restricted stock units (“RSUs”) are granted to employees and non-qualified stock options are granted to employees, investors, directors and consultants. The Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. The fair value of the Company’s common stock underlying the awards has historically been determined by the board of directors with input from management and third-party valuation specialists, as prior to the Merger there was no public market for the Company’s common stock. The board of directors determined the fair value of the common stock by considering a number of objective and subjective factors including: the valuation of comparable companies, the Company’s operating and financial performance, the lack of liquidity of common stock, transactions in the Company’s stock, and general and industry specific economic outlook, amongst other factors. Equity-classified awards issued to employees, non-employees, and directors are measured at the grant-date fair value of the award. Forfeitures are recognized as they occur. For accounting purposes, the Company estimates grant-date fair value of stock options using the Black-Scholes-Merton (“BSM”) option pricing model. The BSM option pricing model requires the input of highly subjective assumptions, including the fair value of the underlying common stock, the risk-free interest rates, the expected term of the option, the expected volatility of the price of the Company’s common stock, and the expected dividend yield of the Company’s common stock. The fair value of each RSU is the fair value of the underlying common stock on the grant date. |
Net Loss Per Share of Common Stock | Net Loss Per Share of Common Stock The Company computes earnings per share (“EPS”) following ASC Topic 260, Earnings Per Share. Basic EPS is measured as the income or loss available to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per-share basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially convertible securities are calculated using the if-converted method; the potentially dilutive effect of options or warrants are computed using the treasury stock method. Securities that are potentially an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from diluted EPS calculation. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). The Company has no components of other comprehensive income (loss). Therefore, net income (loss) equals comprehensive income (loss) for all periods presented. |
Related Parties | Related Parties As of December 31, 2022, the Company owed $1.0 million to ACE affiliates and $0.2 million to a member of the Company’s board of directors, in connection with the merger activities. Other than the related party borrowings described in Note 6, there were no other material related-party transactions during the year ended December 31, 2022 and 2021. |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” or ASU 2016-13. The amendments in ASU 2016-13 introduce an approach based on expected losses to estimated credit losses on certain types of financial instruments, modify the impairment model for available-for-sale debt securities and provide for a simplified accounting model for purchased financial assets with credit deterioration since their origination. The new standard requires financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The standard will be effective for the Company beginning January 1, 2023, with early application permitted. The Company is evaluating the impact and does not expect a material impact of adopting this new accounting guidance on its consolidated financial statements. In October 2021, the FASB issued Accounting Standards Update No. 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts with Customers”, which requires accounting for contract assets and liabilities from contracts with customers in a business combination to be accounted for in accordance with ASC 606. The standard is effective for fiscal years beginning after December 15, 2022. The Company is evaluating the impact and does not expect a material impact of adopting this new accounting guidance on its consolidated financial statements. |
Description of Business and B_2
Description of Business and Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Description of Business and Business Combination | |
Schedule of components of proceeds received from the Trust and PIPE | Upon consummation of the Merger, Tempo received approximately $18.7 million from the Trust and PIPE, net of transaction costs and other payments as set forth as follows (in thousands): Recapitalization Cash-ACE Trust $ 23,391 Cash-PIPE investment 3,500 Less: transaction costs and other payments (1)(2) (8,187) Net cash proceeds from Merger 18,704 Less: Earnout liability (5,322) Less: Warrants assumed (1,122) Less: Debt assumed – related party (600) Less: ACE transaction costs – unpaid (1) (7,342) Merger and PIPE Financing $ 4,318 (1) Amount reflects payment of the following amounts utilizing the proceeds released from the Trust (a) the repayment of $2.1 million of ACE related party loans, (b) the payment of During the period from the Merger date to December 31, 2022, the Company paid $0.5 million of ACE’s transaction costs and other payments, included in the amount above, and as of December 31, 2022, $7.3 million of ACE transaction costs remained unpaid. (2) Excludes the payment of $3.3 million as part of the LSA amendment and any Legacy Tempo transaction costs relating to the Merger Transaction. Upon receiving the $18.7 million of proceeds from Trust, the Company paid $1.4 million in Legacy Tempo legal fees and $0.5 million in fees to certain capital markets advisors, both of such amounts were expensed by the Company. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Schedule of accounts receivables, contract assets, and contract liabilities | Below are the accounts receivables, contract assets, and contract liabilities (in thousands): December 31, December 31, 2022 2021 Accounts receivable, net $ 2,633 $ 2,918 Contract assets 233 1,219 Contract liabilities 2,595 175 |
Schedule of cash, cash equivalents and restricted cash | As of December 31, 2022 2021 Cash and cash equivalents $ 7,113 $ 2,864 Restricted cash 320 320 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 7,433 $ 3,184 |
Schedule of Useful Lives of Property, Plant and Equipment | Depreciation and amortization are calculated using the straight-line method over the following estimated useful lives of the assets (in years): Useful Lives Computer equipment 3 Software 5 Furniture and fixtures 3 Leasehold improvements Shorter of useful life or remaining lease term Manufacturing equipment 10 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements | |
Schedule of all financial instruments measured at fair value on a recurring basis | The following table provides a summary of all financial instruments measured at fair value on a recurring basis as of December 31, 2022 and 2021 (in thousands): December 31, 2022 Level 1 Level 2 Level 3 Total Financial Liabilities: Warrant liabilities $ — $ 389 $ — $ 389 Earnout liability – Tempo Earnout — — 410 410 Earnout liability – Additional Period Shares — — 763 763 A&R LSA Borrowings — — 20,101 20,101 Total $ — $ 389 $ 21,274 $ 21,663 December 31, 2021 Level 1 Level 2 Level 3 Total Financial Liabilities: Warrant Liability $ — $ — $ 5,573 $ 5,573 Total $ — $ — $ 5,573 $ 5,573 |
Schedule of inputs used in determining the fair value of the Tempo Earnout Shares and Additional Period Shares | December 31, 2022 Volatility 12.5 % – 38.0 % Discount rate 9.1 % – 17.7 % Expected term 4.8 years December 31, 2022 Volatility 4.7 % Discount rate 50.4 % Expected term 1.1 years |
Other Balance Sheet Components
Other Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Balance Sheet Components | |
Schedule of inventory | Inventory consists of the following (in thousands): As of December 31, 2022 2021 Raw materials $ 2,127 $ 158 Work in progress 451 721 Total inventory $ 2,578 $ 879 |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following (in thousands): As of December 31, 2022 2021 Prepaid expense $ 401 $ 650 Other current assets 343 242 Total prepaid expenses and other current assets $ 744 $ 892 |
Schedule of property and equipment, net | Property and equipment, net consists of the following (in thousands): As of December 31, 2022 2021 Manufacturing equipment $ 9,743 $ 9,732 Leasehold improvements 3,993 4,811 Computer equipment 453 489 Office furniture and fixtures 462 462 Software 248 248 Total property and equipment 14,899 15,742 Less accumulated depreciation (8,385) (6,851) Total property and equipment, net $ 6,514 $ 8,891 |
Schedule of other noncurrent assets | Other noncurrent assets consist of the following (in thousands): As of December 31, 2022 2021 Deferred transaction costs (1) $ — $ 1,926 Advance rent and prepaids 83 749 Deposits — 250 Total other noncurrent assets $ 83 $ 2,925 (1) Deferred transaction costs were expensed at the consummation of the merger transaction. |
Schedule of accrued liabilities | Accrued liabilities consist of the following (in thousands): As of December 31, 2022 2021 Accrued legal fees(1) $ 4,053 $ 1,562 Accrued professional fees(1) 2,446 1,398 Accrued sales and business taxes 221 241 Accrued cost of revenue 176 236 Warranty liability 49 54 Other accrued liabilities 264 480 Total accrued expenses $ 7,209 $ 3,971 (1) These accrued legal and professional fees primarily relate to the merger transaction, as discussed in Note 1 – Organization. |
Schedule of accrued compensation and related benefits | Accrued compensation and related benefits consist of the following (in thousands): As of December 31, 2022 2021 Accrued payroll $ 380 $ 41 Accrued vacation 244 — Accrued commissions 39 121 Accrued bonus — 647 Accrued payroll taxes 26 356 Other accrued benefits — 84 Total accrued compensation and related benefit $ 689 $ 1,249 |
Borrowing Arrangements (Tables)
Borrowing Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Borrowing Arrangements | |
Schedule of notes payable balances | December 31, 2022 Expected term 3 years Discount rate 13.42 % As of December 31, 2021 SQN LSA LSA Equipment Tranche 1.1 Tranche 1.2 Loan Total Total notes payable $ 10,000 $ 10,000 $ 2,302 $ 22,302 Add: accretion of final interest payable 108 79 56 243 Less: loan payable, current (9,702) — (784) (10,486) Less: unamortized debt discount (406) (218) (84) (708) Total loan payable, noncurrent $ — $ 9,861 $ 1,490 $ 11,351 |
Schedule of notes payable future principal payments | The notes payable future contractual principal payments are as follows during the years noted (in thousands): As of December 31, 2022 2023 $ 1,205 2024 4,885 2025 15,550 Total future principal payments $ 21,640 |
Schedule of net carrying amount of borrowings | The following table sets forth the net carrying amounts of borrowings as of December 31, 2022 (in thousands): Loan Payable, Loan Payable, Current Noncurrent Total SQN Equipment Loan $ 876 $ 663 $ 1,539 A&R LSA (FVO) 20,101 — 20,101 Total loan payable $ 20,977 $ 663 $ 21,640 SQN Equipment Loan As of December 31, 2022 Total loan payable $ 1,472 Add: accretion of final interest payable 106 Less: loan payable, current (876) Less: unamortized debt discount (39) Total loan payable, noncurrent $ 663 A&R LSA (FVO) Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 20,000 Less: Payments (250) Change in fair value 351 Balance, December 31, 2022 $ 20,101 LSA Convertible Note Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 12,902 Change in fair value 2,527 Converted to common stock (15,429) Balance, December 31, 2022 $ — |
Summary of components of loss on debt extinguishment | Amount Carrying value of extinguished debt $ 30,407 Accrued interest 520 Fair value of new LSA (28,154) Fair value of LSA Convertible Note (12,903) Loss on extinguishment of debt $ (10,130) Amount Carrying value of extinguished debt $ 29,351 Fair value of A&R LSA (20,000) Principal repayment (3,000) Fair value of common stock issued (7,336) Fair value of PIPE Incentive Shares issued (11,738) Fair value of Additional Period Shares liability (1) Financing fees (614) Loss on extinguishment of debt $ (13,338) |
Borrowing Arrangements - Rela_2
Borrowing Arrangements - Related Party (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of components of loss on debt extinguishment | Amount Carrying value of extinguished debt $ 30,407 Accrued interest 520 Fair value of new LSA (28,154) Fair value of LSA Convertible Note (12,903) Loss on extinguishment of debt $ (10,130) Amount Carrying value of extinguished debt $ 29,351 Fair value of A&R LSA (20,000) Principal repayment (3,000) Fair value of common stock issued (7,336) Fair value of PIPE Incentive Shares issued (11,738) Fair value of Additional Period Shares liability (1) Financing fees (614) Loss on extinguishment of debt $ (13,338) |
Schedule of net carrying amount of related party borrowings | The following table sets forth the activity and net carrying amount of related party convertible note borrowings accounted for under the fair value option as of and for the year ended December 31, 2022 (in thousands): Fair Value – Level 3 Balance, January 1, 2022 $ — Additions 39,593 Change in fair value 7,887 Converted to common stock (47,480) Balance, December 31, 2022 $ — |
2022 Promissory Notes | |
Summary of components of loss on debt extinguishment | The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 5,265 Fair value of embedded derivative 154 Fair value of 2022 Promissory Notes (19,030) Fair value of issued warrants (3,568) Loss on extinguishment of debt $ (17,179) |
Bridge Note | |
Summary of components of loss on debt extinguishment | The following table sets forth the components of loss on debt extinguishment recorded in the consolidated statements of operations for the year ended December 31, 2022 (in thousands): Amount Carrying value of extinguished debt $ 4,477 Fair value of embedded derivative — Fair value of Bridge Note (16,106) Loss on extinguishment of debt $ (11,629) |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity (Deficit) | |
Summary of reserved shares of common stock for issuance related to stock options and RSUs, warrants, shares reserved for future grants and earnout shares | As of December 31, 2022 Warrants to purchase common stock 18,106,559 Options to purchase common stock and RSUs 4,374,189 Shares reserved for future grants 2,639,329 Earnout shares 7,000,000 Total shares of common stock reserved 32,120,077 |
Warrants (Tables)
Warrants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items} | |
Schedule of assumptions used to calculate the fair value of the warrants | December 31, 2022 Volatility 12.5 % – 38.0 % Discount rate 9.1 % – 17.7 % Expected term 4.8 years December 31, 2022 Volatility 4.7 % Discount rate 50.4 % Expected term 1.1 years |
Warrant Classified As Equity | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items} | |
Schedule of warrants outstanding | The following warrants assumed from ACE were outstanding as of December 31, 2022: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 11,499,987 $ 11.50 7/27/2020 11/21/2027 The following warrants were outstanding as of December 31, 2021: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 31,121 $ 5.51 6/3/2020 6/3/2030 Common Stock 18,601 8.85 6/23/2021 6/22/2031 Common Stock 402,955 16.54 10/11/2021 10/11/2024 452,677 |
Warrant Classified As Liability | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items} | |
Schedule of warrants outstanding | As of December 31, 2022, the Company has the following liability-classified warrants outstanding: Warrants to purchase # of Shares Exercise Price Issuance Date Expiration Date Common Stock 6,572 $ 16.17 10/13/2017 10/13/2027 Common Stock 4,759,536 $ 11.50 7/27/2020 11/21/2027 Common Stock 468,750 $ 11.50 7/27/2020 11/21/2027 Common Stock 891,714 $ 11.50 7/27/2020 11/21/2027 Common Stock 480,000 $ 11.50 7/27/2020 11/21/2027 6,606,572 As of December 31, 2021, the Company has the following liability-classified warrants outstanding: Warrants to purchase Shares Exercise Price Issuance Date Expiration Date Common Stock 10,016 $ 6.74 11/24/2015 11/24/2025 Common Stock 4,453 6.74 11/22/2016 11/22/2026 Common Stock 6,573 16.19 10/13/2017 10/13/2027 Common Stock 18,417 5.51 1/29/2021 1/29/2031 Common Stock 90,948 8.85 6/24/2021 6/24/2031 130,407 |
Schedule of liability-classified warrant activity | Fair Value Warrants outstanding - January 1, 2022 $ 5,573 Warrants issued and modified 32,514 Assumed from ACE upon Closing 1,122 Exercised or converted to common stock upon Closing (38,389) Change in fair value, net (431) Warrants outstanding – December 31, 2022 $ 389 Fair Value Warrants outstanding – January 1, 2021 $ 86 Warrants issued and modified 1,245 Change in fair value, net 4,242 Warrants outstanding – December 31, 2021 $ 5,573 |
Schedule of assumptions used to calculate the fair value of the warrants | December 31, 2021 Expected term 3.89 – 9.48 years Expected volatility 64.29% – 64.44 % Risk-free interest rate 1.12% – 1.52% Expected dividends 0 % |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation | |
Summary of option activity | Options outstanding Weighted Weighted average average Aggregate Number of exercise price contractual term intrinsic value shares per share (in years) (in thousands) Outstanding – January 1, 2022 16,457,475 $ 1.36 7.96 $ 104,554 Retrospective application of recapitalization (13,651,211) 6.85 Adjusted balance – beginning of period 2,806,264 8.21 7.96 104,554 Options granted 705,520 6.85 Options exercised (8,184) 6.01 Options forfeited (713,205) 13.33 Options expired (36,196) 6.92 Outstanding – December 31, 2022 2,754,199 4.73 7.46 77 Vested during the period 627,299 9.25 6.75 — Vested at end of period 1,894,115 6.52 5.69 77 Exercisable at the end of the period 1,894,115 6.52 5.69 77 Shares expected to vest 860,064 5.24 9.20 — Vested and expected to vest 2,549,745 6.26 6.71 77 |
Schedule of assumptions used to calculate the fair value of options granted | During the Year Ended December 31, 2022 Expected term 0.50 – 6.00 years Expected volatility 55.92% – 70.39% Risk-free interest rate 1.54% – 3.71% Expected dividends 0% |
Schedule of RSU activity | The following is a summary of the 2015 Plan RSU activity for the year ending December 31, 2022: Weighted- Number of Awards Average Outstanding Grant Date Fair Value Unvested Balance – January 1, 2022 — $ — Granted 1,662,620 22.25 Forfeited (42,630) 22.59 Unvested Balance – December 31, 2022 1,619,990 22.25 |
Summary of stock-based compensation expense and its allocation within the accompanying statements of operations | 2022 2021 Cost of goods sold $ 501 $ 276 Research and development 1,615 540 Sales and marketing 465 402 General and administrative 8,708 1,320 Total stock-based compensation expense $ 11,289 $ 2,538 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Schedule of operating lease-related assets and liabilities recorded on the balance sheets | Classifications on the financial statements As of December 31, 2022 Operating lease assets Operating leases – right-of-use asset $ 371 Operating lease liability, current Operating lease liability, current 516 Operating lease liability, noncurrent Operating lease liability, noncurrent 30 Classifications on the financial statements As of December 31, 2021 Operating lease assets Operating leases– right-of-use asset $ 1,323 Operating lease liability, current Operating lease liability, current 1,111 Operating lease liability, noncurrent Operating lease liability, noncurrent 546 |
Schedule of future minimum lease payments under non-cancelable operating leases | As of December 31, 2022 2023 $ 531 2024 29 Total future lease payments 560 Less imputed interest (14) Total operating lease liability $ 546 |
Schedule of finance lease-related assets and liabilities recorded on the balance sheet | Classification on the financial statements December 31, 2022 Finance lease assets Property and equipment, net $ 3,383 Finance lease liability, current Finance lease, current 1,606 Finance lease liability, noncurrent Finance lease, noncurrent — Depreciation of the leased asset Cost of revenue 2,072 Lease interest expense Other income (expense), net 414 Classification on the financial statements December 31, 2021 Finance lease assets Property and equipment, net $ 3,943 Finance lease liability, current Finance lease, current 1,091 Finance lease liability, noncurrent Finance lease, noncurrent 1,606 Depreciation of the leased asset Cost of revenue 547 Lease interest expense Other income (expense), net 598 |
Schedule of future minimum lease payments under finance lease | As of December 31, 2022 2023 $ 1,731 Total future lease payments 1,731 Less: imputed interest (125) Total finance lease liability $ 1,606 |
Schedule of supplemental disclosures of cash flow information related to leases | Years Ended December 31, 2022 2021 Operating cash flows paid for operating leases $ 1,215 $ 1,184 Financing cash flows paid for finance leases 1,504 1,504 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Schedule of components of the Company's provision for income taxes | Years Ended December 31, 2022 2021 Current: Federal $ — $ — State — — Total current tax expense $ — $ — |
Schedule of reconciliation of income tax expense computed at the federal statutory rate with income tax expense as reported | Years Ended December 31, 2022 2021 Statutory rate 21.0 % 21.0 % Federal net operating loss — % — % Leases — % — % Depreciation — % — % State income tax 1.6 % 9.6 % Permanent differences (12.6) % (6.8) % Other — % — % Valuation allowance (10.0) % (23.8) % Effective income tax rate 0.0 % 0.0 % |
Schedule of significant components of the Company's deferred tax asset (liability) | Years Ended December 31, 2022 2021 Deferred tax assets Net operating losses $ 34,780 $ 26,070 Stock options and Warrants 3,107 — Property, plant and equipment and intangibles 2,620 — Accruals and other 1,041 982 Total deferred tax assets 41,548 27,052 Less valuation allowance (40,333) (25,648) Net deferred tax assets 1,215 1,404 Deferred tax liabilities Property, plant, equipment, and intangibles (1,125) (1,017) Lease liability (90) (387) Total deferred tax liabilities (1,215) (1,404) Net deferred tax assets (liabilities) $ — $ — |
Schedule of activity related to the unrecognized tax benefits | Years Ended December 31, 2022 2021 Unrecognized tax benefits, beginning of period $ 411 $ 411 Additions based on tax positions related to current year — — Reductions based on tax positions related to prior years — — Unrecognized tax benefits, end of period $ 411 $ 411 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Net Loss Per Share | |
Schedule of the computation of basic and diluted net loss per share | Years ended December 31, 2022 2021 Basic and diluted: Net loss $ (144,851) $ (48,013) Weighted-average number of shares of common stock outstanding 8,843,703 6,708,466 Basic and diluted net loss per share $ (16.38) $ (7.16) |
Schedule of antidilutive shares | As of December 31, 2022 2021 Shares of common stock issuable from stock options and RSUs 4,374,189 2,806,264 Shares of common stock issuable from common stock warrants 18,106,559 583,084 Potential common shares excluded from diluted net loss per share 22,480,748 3,389,348 |
Description of Business and B_3
Description of Business and Business Combination - Merger with ACE Convergence Acquisition Corp (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2021 | Dec. 31, 2022 | Nov. 22, 2022 | |
Description of Business and Business Combination | |||
Amount of unredeemed funds released from trust account | $ 23,400 | ||
Number of shares associated with the Trust, remained with company's shareholders | 2,269,299 | ||
Number of shares issued | 90,948 | 6,606,572 | |
Cash inflow received | $ 3,500 | ||
Adjustment Period considered for issuance of Additional Period Shares | 15 months | ||
Earnout liabilities | $ 1,173 | $ 5,300 | |
Change in fair value of earnout liabilities | 4,149 | ||
Proceeds from Merger and PIPE financing | $ 18,704 | ||
Third Amended and Restated Subscription Agreement | |||
Description of Business and Business Combination | |||
Adjustment Period considered for issuance of additional shares | 30 days | ||
Stock price trigger for issuance of additional shares | $ 10 | ||
Maximum number of Additional Period Shares agreed to sell | 1,000,000 | ||
Adjustment Period considered for issuance of Additional Period Shares | 15 months | ||
Earnout liabilities | $ 800 | ||
Change in fair value of earnout liabilities | $ 800 | ||
Third Amended and Restated Subscription Agreement | Committed PIPE Shares | |||
Description of Business and Business Combination | |||
Number of shares issued | 550,000 | ||
Aggregate purchase price | $ 5,500 | ||
Cash inflow received | 3,500 | ||
Amount held by existing investor in Trust, who agreed to participate in PIPE investment | $ 2,000 | ||
Third Amended and Restated Subscription Agreement | Incentive PIPE Shares | |||
Description of Business and Business Combination | |||
Number of shares issued | 2,000,000 |
Description of Business and B_4
Description of Business and Business Combination - Merger with ACE Convergence Acquisition Corp - Components of proceeds received from the Trust and PIPE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Description of Business and Business Combination | ||
Cash-ACE Trust | $ 23,391 | |
Cash-PIPE investment | 3,500 | |
Less: transaction costs and other payments(1)(2) | (8,187) | |
Net cash proceeds from Merger | 18,704 | |
Less: Earnout liability | (5,322) | |
Less: Warrants assumed | (1,122) | |
Less: Debt assumed - related party | (600) | |
Less: ACE transaction costs - unpaid | (7,342) | |
Merger and PIPE Financing | 4,318 | |
Repayment of related party loans | 2,100 | |
Repayment of deferred underwriting fees payable | 600 | |
Payment of transaction costs related to the Merger | 4,500 | |
Payment of commitment fee to secure an equity line of credit | 1,000 | |
Payments excluded from adjustments to proceeds from Trust and PIPE | 3,300 | |
Payment of fees to certain capital markets advisors | 500 | |
General and administrative | 29,487 | $ 16,376 |
ACE | ||
Description of Business and Business Combination | ||
Payment of transaction costs related to the Merger | 500 | |
Transaction costs that remained unpaid | 7,300 | |
Legacy Tempo | ||
Description of Business and Business Combination | ||
Transaction costs that remained unpaid | 5,200 | 1,800 |
Payment of legal fees | 1,400 | |
General and administrative | $ 8,600 | 100 |
Deferred costs, included in other noncurrent assets | $ 1,900 |
Description of Business and B_5
Description of Business and Business Combination - Merger with ACE Convergence Acquisition Corp - Earnout Arrangement With Holders Of Legacy Tempo Common Stock And Outstanding Equity Awards (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) shares | Nov. 22, 2022 USD ($) | |
Description of Business and Business Combination [Line Item] | ||
Exchange Ratio | 0.1705 | |
Earnout liabilities | $ 1,173 | $ 5,300 |
Change in fair value of earnout liabilities | $ 4,149 | |
Earnout Arrangement with holders of Legacy Tempo common stock and outstanding equity awards | ||
Description of Business and Business Combination [Line Item] | ||
Exchange Ratio | 0.1705 | |
Number of Earnout Shares agreed to be issued to Legacy Tempo shareholders | shares | 7,000,000 | |
Number of Earnout Shares accounted for under ASC 718, given to common stock, option and RSU holders that are held by current employees and directors | shares | 1,824,463 | |
Number Of Earnout Shares, Classified As Liability Under ASC 815-40 | shares | 5,175,537 | |
Earnout liabilities | $ 400 | |
Change in fair value of earnout liabilities | $ 4,900 | |
Earnout Arrangement with holders of Legacy Tempo common stock and outstanding equity awards | Earnout Shares, Tranche One | ||
Description of Business and Business Combination [Line Item] | ||
Number Of Earnout Shares Agreed To Be Issued Upon Achievement Of Earnout Milestones | shares | 3,500,000 | |
Adjusted EBITDA To Be Achieved In A Single Quarter | $ 5,000 | |
Period For Achieving Earnout Milestones | 5 years | |
Earnout Arrangement with holders of Legacy Tempo common stock and outstanding equity awards | Earnout Shares, Tranche Two | ||
Description of Business and Business Combination [Line Item] | ||
Number Of Earnout Shares Agreed To Be Issued Upon Achievement Of Earnout Milestones | shares | 3,500,000 | |
Sales To Be Achieved In A Single Quarter | $ 15,000 | |
Period For Achieving Earnout Milestones | 5 years |
Description of Business and B_6
Description of Business and Business Combination - Merger with ACE Convergence Acquisition Corp - Other Arrangements entered into at time of Merger or assumed upon Merger (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Feb. 10, 2023 | Nov. 22, 2022 | Nov. 21, 2022 | Jun. 30, 2021 | Dec. 31, 2022 | |
Description of Business and Business Combination [Line Item] | |||||
Amounts Owed To Capital Market Advisors Agreed To Be Settled In Cash | $ 800,000 | ||||
Share issuance expense recorded as an offset to additional paid-in capital | 800,000 | ||||
Additional liability recorded due to a decline in the Company's share price | 700,000 | ||||
Payment Of Fees To Certain Capital Markets Advisors | 500,000 | ||||
Accrued And Unpaid Amount Owed To Capital Market Advisors | $ 300,000 | ||||
Number of shares issued | 90,948 | 6,606,572 | |||
Commitment fee paid out of the funds released from Trust at the time of Merger | $ 1,000,000 | ||||
Number of shares previously held by the Sponsor in ACE that became holdings in New Tempo | 3,750,000 | ||||
Adjustment Period considered for issuance of Additional Period Shares | 15 months | ||||
Subsequent Event | |||||
Description of Business and Business Combination [Line Item] | |||||
Number of shares of Common Stock issued to each capital markets advisor | 159,948 | ||||
ACE public warrants | |||||
Description of Business and Business Combination [Line Item] | |||||
Number Of Warrants Assumed Upon The Close Of Merger | 11,499,987 | ||||
ACE private warrants | |||||
Description of Business and Business Combination [Line Item] | |||||
Number Of Warrants Assumed Upon The Close Of Merger | 6,600,000 | ||||
Lender Subscription Agreements | |||||
Description of Business and Business Combination [Line Item] | |||||
Prior LSA converted into shares of common stock of New Tempo, amount of debt converted | $ 7,000,000 | ||||
Prior LSA converted into shares of common stock of New Tempo, conversion price per share | $ 10 | ||||
Lender Subscription Agreements | Committed PIPE Shares | |||||
Description of Business and Business Combination [Line Item] | |||||
Prior LSA converted into shares of common stock of New Tempo, number of shares issued | 700,000 | ||||
Lender Subscription Agreements | Incentive PIPE Shares | |||||
Description of Business and Business Combination [Line Item] | |||||
Prior LSA converted into shares of common stock of New Tempo, number of shares issued | 1,120,000 | ||||
White Lion Stock Purchase Agreement | |||||
Description of Business and Business Combination [Line Item] | |||||
Number of shares issued | 350,000 | ||||
Threshold aggregate gross purchase price of newly issued shares of Common Stock, that the company has right to require White Lion to purchase | $ 100,000,000 | ||||
Liability assumed for commitment fee owed | $ 1,000,000 | ||||
Agreements with ACE Sponsor | |||||
Description of Business and Business Combination [Line Item] | |||||
Number of shares previously held by the Sponsor in ACE that became holdings in New Tempo | 3,750,000 | ||||
Number of Additional Period Shares issuable by virtue of the Sponsor | 1,000,000 | ||||
Adjustment Period considered for issuance of Additional Period Shares | 15 months | ||||
Amount of vesting of Sponsor shares | $ 1,000,000 | ||||
Number of sponsor shares subject to transfer | 1,000,000 | ||||
Legacy Tempo | |||||
Description of Business and Business Combination [Line Item] | |||||
Repayment of debt | $ 3,000,000 | ||||
Amounts Owed To Capital Market Advisors | $ 1,500,000 | ||||
Number Of Shares Agreed To Be Issued To Settle Amounts Owed To Capital Market Advisors | 75,000 | ||||
Value Of Shares Agreed To Be Issued To Settle Amounts Owed To Capital Market Advisors | $ 800,000 | ||||
Adjustment Period For Shares Issuable To Settle Amounts Owed To Capital Market Advisors | 12 months |
Description of Business and B_7
Description of Business and Business Combination - Merger with ACE Convergence Acquisition Corp - Accounting for the Business Combination (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 USD ($) $ / shares shares | Nov. 22, 2022 shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 $ / shares | |
Description of Business and Business Combination [Line Item] | ||||
Total number of authorized shares of all classes of capital stock | 620,000,000 | |||
Common stock, shares authorized | 600,000,000 | 600,000,000 | ||
Common stock, par value per share | $ / shares | $ 0.0001 | $ 0.0001 | ||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | ||
Preferred stock, par value per share | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Warrants outstanding | 18,100,000 | |||
Exchange Ratio | 0.1705 | |||
Cash-PIPE investment | $ | $ 3,500 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |||
Accumulated deficit | $ 253,163 | $ 108,312 | |
Cash, cash equivalents and restricted cash | 7,433 | 3,184 | $ 17,746 |
Working capital deficiency | (31,100) | ||
Cash used in operating activities | 28,793 | 30,228 | |
Net loss | 144,851 | $ 48,013 | |
Loans payable and finance lease obligations | 3,200 | ||
Net cash received | $ 18,704 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Contract Assets and Liabilities | ||
Revenue recognized from beginning contract liability balance | $ 100 | $ 100 |
Accounts receivable, net | 2,633 | 2,918 |
Contract assets | 233 | 1,219 |
Contract liabilities | $ 2,595 | $ 175 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Advertising and Concentration of Risk (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 USD ($) customer | Dec. 31, 2021 USD ($) customer | |
Advertising costs & Concentration of risks | ||
Advertising costs | $ | $ 0.3 | $ 0.5 |
Accounts receivable | Concentration of credit risk | ||
Advertising costs & Concentration of risks | ||
Number of customer | 1 | 1 |
Accounts receivable | Concentration of credit risk | One customer | ||
Advertising costs & Concentration of risks | ||
Concentration of risk percentage | 61% | 49% |
Revenue | Concentration of customers | ||
Advertising costs & Concentration of risks | ||
Number of customer | 2 | 1 |
Revenue | Concentration of customers | One customer | ||
Advertising costs & Concentration of risks | ||
Concentration of risk percentage | 21% | 46% |
Revenue | Concentration of customers | Two customer | ||
Advertising costs & Concentration of risks | ||
Concentration of risk percentage | 20% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Cash, Accounts Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Cash, Cash Equivalents and Restricted Cash | |||
Money market accounts | $ 7,000 | $ 2,600 | |
Cash and cash equivalents | 7,113 | 2,864 | |
Restricted cash | 320 | 320 | |
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | 7,433 | 3,184 | $ 17,746 |
Accounts Receivable, Net | |||
Allowance for doubtful accounts | $ 200 | $ 400 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Fair Value, Property and Equipment, Net (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Computer equipment | |
Property and Equipment, net | |
Useful life | 3 years |
Software | |
Property and Equipment, net | |
Useful life | 5 years |
Furniture and fixtures | |
Property and Equipment, net | |
Useful life | 3 years |
Manufacturing equipment | |
Property and Equipment, net | |
Useful life | 10 years |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Long-Lived Assets and Related Parties (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Summary of Significant Accounting Policies | |
Impairment charge on ROU asset | $ 297 |
ACE affiliates | |
Summary of Significant Accounting Policies | |
Due to related parties | 1,000 |
Member of Company's board of directors | |
Summary of Significant Accounting Policies | |
Due to related parties | $ 200 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Recurring - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value Measurements | ||
Financial Liabilities: | $ 21,663 | $ 5,573 |
Warrant liabilities | ||
Fair Value Measurements | ||
Financial Liabilities: | 389 | 5,573 |
Earnout liability - Tempo Earnout | ||
Fair Value Measurements | ||
Financial Liabilities: | 410 | |
Earnout liability - Additional Period Shares | ||
Fair Value Measurements | ||
Financial Liabilities: | 763 | |
A&R LSA Borrowings | ||
Fair Value Measurements | ||
Financial Liabilities: | 20,101 | |
Level 2 | ||
Fair Value Measurements | ||
Financial Liabilities: | 389 | |
Level 2 | Warrant liabilities | ||
Fair Value Measurements | ||
Financial Liabilities: | 389 | |
Level 3 | ||
Fair Value Measurements | ||
Financial Liabilities: | 21,274 | 5,573 |
Level 3 | Warrant liabilities | ||
Fair Value Measurements | ||
Financial Liabilities: | $ 5,573 | |
Level 3 | Earnout liability - Tempo Earnout | ||
Fair Value Measurements | ||
Financial Liabilities: | 410 | |
Level 3 | Earnout liability - Additional Period Shares | ||
Fair Value Measurements | ||
Financial Liabilities: | 763 | |
Level 3 | A&R LSA Borrowings | ||
Fair Value Measurements | ||
Financial Liabilities: | $ 20,101 |
Fair Value Measurements - Input
Fair Value Measurements - Inputs used in determining the fair value of the Tempo Earnout Shares (Details) - Earnout liability - Tempo Earnout | 12 Months Ended | |
Nov. 22, 2022 $ / shares | Dec. 31, 2022 Y $ / shares | |
Level 3 | Volatility | Maximum | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.380 | |
Level 3 | Volatility | Minimum | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.125 | |
Level 3 | Discount rate | Maximum | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.177 | |
Level 3 | Discount rate | Minimum | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.091 | |
Level 3 | Expected term | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | Y | 4.8 | |
Earnout Shares, Tranche One | ||
Fair Value Measurements | ||
Fair Value Per Share | $ 0.29 | $ 0.02 |
Earnout Shares, Tranche Two | ||
Fair Value Measurements | ||
Fair Value Per Share | $ 1.76 | $ 0.13 |
Fair Value Measurements - Inp_2
Fair Value Measurements - Inputs used in determining the fair value of the Additional Period Shares (Details) - Earnout liability - Additional Period Shares | 12 Months Ended | |
Nov. 22, 2022 $ / shares | Dec. 31, 2022 Y $ / shares | |
Fair Value Measurements | ||
Fair Value Per Share | $ / shares | $ 0 | $ 0.76 |
Level 3 | Volatility | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.047 | |
Level 3 | Discount rate | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | 0.504 | |
Level 3 | Expected term | ||
Fair Value Measurements | ||
Financial liabilities, measurement input | Y | 1.1 |
Other Balance Sheet Component_2
Other Balance Sheet Components - Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Balance Sheet Components | ||
Raw materials | $ 2,127 | $ 158 |
Work in progress | 451 | 721 |
Total inventory | $ 2,578 | $ 879 |
Other Balance Sheet Component_3
Other Balance Sheet Components - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Balance Sheet Components | ||
Prepaid expense | $ 401 | $ 650 |
Other current assets | 343 | 242 |
Total prepaid expenses and other current assets | $ 744 | $ 892 |
Other Balance Sheet Component_4
Other Balance Sheet Components - Property and Equipment, net (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property and Equipment, net | ||
Total property and equipment | $ 14,899 | $ 15,742 |
Less accumulated depreciation | (8,385) | (6,851) |
Total property and equipment, net | 6,514 | 8,891 |
Manufacturing equipment | ||
Property and Equipment, net | ||
Total property and equipment | 9,743 | 9,732 |
Leasehold improvements | ||
Property and Equipment, net | ||
Total property and equipment | 3,993 | 4,811 |
Computer equipment | ||
Property and Equipment, net | ||
Total property and equipment | 453 | 489 |
Furniture and fixtures | ||
Property and Equipment, net | ||
Total property and equipment | 462 | 462 |
Software | ||
Property and Equipment, net | ||
Total property and equipment | $ 248 | $ 248 |
Other Balance Sheet Component_5
Other Balance Sheet Components - Property and Equipment, Net Depreciation (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property and Equipment, net | ||
Depreciation expense | $ 2.2 | $ 2.3 |
Leasehold improvements | ||
Property and Equipment, net | ||
Impairment charge | $ 0.2 |
Other Balance Sheet Component_6
Other Balance Sheet Components - Other Noncurrent Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Balance Sheet Components | ||
Deferred transaction costs | $ 1,926 | |
Advance rent and prepaids | $ 83 | 749 |
Deposits | 250 | |
Total other noncurrent assets | $ 83 | $ 2,925 |
Other Balance Sheet Component_7
Other Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Balance Sheet Components | ||
Accrued legal fees | $ 4,053 | $ 1,562 |
Accrued professional fees | 2,446 | 1,398 |
Accrued sales and business taxes | 221 | 241 |
Accrued cost of revenue | 176 | 236 |
Warranty liability | 49 | 54 |
Other accrued liabilities | 264 | 480 |
Total accrued expenses | $ 7,209 | $ 3,971 |
Other Balance Sheet Component_8
Other Balance Sheet Components - Accrued Compensation and Related Benefits (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Balance Sheet Components | ||
Accrued payroll | $ 380 | $ 41 |
Accrued vacation | 244 | |
Accrued commissions | 39 | 121 |
Accrued bonus | 647 | |
Accrued payroll taxes | 26 | 356 |
Other accrued benefits | 84 | |
Total accrued compensation and related benefit | $ 689 | $ 1,249 |
Borrowing Arrangements - Term L
Borrowing Arrangements - Term Loan and Credit Facility with Financial Institution (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 14, 2021 | Jun. 23, 2021 | Sep. 01, 2021 |
SVB Term Loan And Credit Facility | |||
Debt Instrument [Line Items] | |||
Cash interest rate | 8.25% | ||
Warrants to purchase shares of common stock | 18,601 | ||
Exercise price | $ 8.85 | ||
SVB Term Loan | |||
Debt Instrument [Line Items] | |||
Obligation of debt | $ 4,000 | $ 10,000 | |
Loan commitment fee | $ 50 | ||
Spread on variable interest rate | 5% | ||
Periodic payment term | 8 months | ||
SVB Credit Facility | |||
Debt Instrument [Line Items] | |||
Repayments of credit facility | $ 10,300 |
Borrowing Arrangements - Equipm
Borrowing Arrangements - Equipment Loan and Security Agreement (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Oct. 14, 2021 USD ($) | Jan. 29, 2021 USD ($) tranche $ / shares shares | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Borrowing Arrangements | ||||
Interest expense | $ 8,095 | $ 3,686 | ||
SVB Credit Facility [Member] | ||||
Borrowing Arrangements | ||||
Interest expense | $ 300 | |||
Equipment Loan And Security Agreement | ||||
Borrowing Arrangements | ||||
Maximum borrowing capacity | $ 6,000 | |||
Number of tranche | tranche | 2 | |||
Additional borrowing available, under certain conditions | $ 3,000 | |||
Cash interest rate | 8.95% | |||
Increase in interest rate in event of default | 5% | |||
Interest expense | 100 | |||
Discount amortization interest | $ 34 | |||
Warrants to purchase shares of common stock | shares | 18,417 | |||
Exercise price | $ / shares | $ 5.51 | |||
Equipment Loan And Security Agreement - Tranche 1 | ||||
Borrowing Arrangements | ||||
Maximum borrowing capacity | $ 3,000 | |||
Amount drawn | $ 3,000 | |||
Periodic payment term | 42 months | |||
End of term payment fee | $ 200 | |||
Equipment Loan And Security Agreement - Tranche 2 | ||||
Borrowing Arrangements | ||||
Maximum borrowing capacity | $ 3,000 |
Borrowing Arrangements - Payche
Borrowing Arrangements - Paycheck Protection Program Loan (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2021 | May 31, 2020 | |
Borrowing Arrangements | ||||
Loan forgiven | $ 2,500 | |||
Paycheck Protection Program Loan [Member] | ||||
Borrowing Arrangements | ||||
Principal amount | $ 2,500 | |||
Interest rate per annum | 1% | |||
Monthly payment | $ 100 | |||
Loan forgiven | $ 2,500 |
Borrowing Arrangements - June 2
Borrowing Arrangements - June 2021 Credit Facility (Details) $ / shares in Units, $ in Millions | Aug. 13, 2021 USD ($) | Jun. 23, 2021 USD ($) tranche $ / shares shares |
June 2021 Credit Facility | ||
Borrowing Arrangements | ||
Maximum borrowing capacity | $ 20 | |
Number of tranche | tranche | 2 | |
Monthly interest-only payment period | 18 months | |
Amount drawn | $ 10 | $ 10 |
Interest rate per annum | 10% | |
Paid in kind interest rate | 2% | |
Increase in interest rate in event of default | 5% | |
Loan commitment fee | $ 0.2 | |
Number of warrants | shares | 90,948 | |
Warrants, exercise price per share | $ / shares | $ 8.85 | |
June 2021 Credit Facility - Tranche 1 | ||
Borrowing Arrangements | ||
Maximum borrowing capacity | $ 10 | |
June 2021 Credit Facility - Tranche 2 | ||
Borrowing Arrangements | ||
Maximum borrowing capacity | $ 10 |
Borrowing Arrangements - Loan a
Borrowing Arrangements - Loan and Security Agreement (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Aug. 25, 2022 | Jun. 20, 2022 | May 01, 2022 | Jan. 20, 2022 | Oct. 13, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jan. 11, 2022 | |
Borrowing Arrangements | ||||||||
Loss on debt extinguishment | $ (51,903) | $ (319) | ||||||
Noncash reduction in debt | 69,500 | 6,000 | ||||||
Interest expense | $ 8,095 | $ 3,686 | ||||||
Scenario commitment fee payable on or before first anniversary of such borrowing | ||||||||
Borrowing Arrangements | ||||||||
Debt instrument increase decrease in lenders minimum return | 1.20 | |||||||
Scenario commitment fee payable after first anniversary of such borrowing but on or before second anniversary of such borrowing | ||||||||
Borrowing Arrangements | ||||||||
Debt instrument increase decrease in lenders minimum return | 1.30 | |||||||
Scenario commitment fee payable on third anniversary of such borrowing | ||||||||
Borrowing Arrangements | ||||||||
Debt instrument increase decrease in lenders minimum return | 1.40 | |||||||
Loan and Security Agreement | ||||||||
Borrowing Arrangements | ||||||||
Maximum borrowing capacity | $ 150,000 | |||||||
Extinguishment of debt amount | 6,000 | |||||||
Loss on debt extinguishment | 300 | |||||||
Noncash increase in debt | 14,000 | |||||||
Debt to same lender group treated as modification | 14,000 | |||||||
Interest rate per annum | 10% | |||||||
Warrant exercise price | $ 2.82 | $ 2.82 | ||||||
Interest expense | $ 900 | |||||||
Loan and Security Agreement | August 2022 Bridge Note Agreement | ||||||||
Borrowing Arrangements | ||||||||
Extinguishment of debt amount | $ 30,407 | |||||||
Loss on debt extinguishment | $ 10,100 | $ (10,130) | ||||||
Amount of debt exchanged | 3,600 | |||||||
Principal amount | $ 3,600 | |||||||
Loan and Security Agreement | Scenario Before The Occurrence Of The Public Trading Trigger | ||||||||
Borrowing Arrangements | ||||||||
Interest rate per annum | 10.50% | |||||||
Rate in addition to prime | 7.25% | |||||||
Loan and Security Agreement | Scenario After The Occurrence Of The Public Trading Trigger | ||||||||
Borrowing Arrangements | ||||||||
Interest rate per annum | 9.50% | |||||||
Rate in addition to prime | 6.25% | |||||||
Loan and Security Agreement, Tranche 1 | ||||||||
Borrowing Arrangements | ||||||||
Maximum borrowing capacity | 20,000 | $ 10,000 | ||||||
Interest rate per annum | 2% | |||||||
Convertible debt | $ 30,000 | 20,000 | ||||||
Loan and Security Agreement, Tranche 2 | ||||||||
Borrowing Arrangements | ||||||||
Maximum borrowing capacity | 20,000 | |||||||
Convertible debt | $ 10,000 | 20,000 | ||||||
Loan and Security Agreement, Tranche 3 | ||||||||
Borrowing Arrangements | ||||||||
Maximum borrowing capacity | 40,000 | |||||||
Loan and Security Agreement, Tranche 4 | ||||||||
Borrowing Arrangements | ||||||||
Maximum borrowing capacity | $ 70,000 | |||||||
Amendment Expanded Tranche1 | ||||||||
Borrowing Arrangements | ||||||||
Convertible debt | $ 10,000 |
Borrowing Arrangements - Novemb
Borrowing Arrangements - November 2022 Amended and Restated LSA (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Nov. 22, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Borrowing Arrangements | |||
Loss on debt extinguishment | $ (51,903) | $ (319) | |
Amended and Restated Loan and Security Agreement | |||
Borrowing Arrangements | |||
Maximum borrowing capacity | $ 20,000 | ||
Interest rate per annum | 9.75% | ||
PIK interest | 3.25% | ||
Accrued PIK interest | $ 100 | ||
Exit fee as percentage of the principal | 80% | ||
Repayment of debt | $ 3,000 | 3,000 | |
Lender fees | 400 | ||
Amount of debt converted | $ 7,000 | ||
Shares issued upon conversion of debt | 700,000 | ||
Conversion rate | $ 10 | ||
Loss on debt extinguishment | $ 13,300 | $ 13,338 | |
Amended and Restated Loan and Security Agreement | Prime rate | |||
Borrowing Arrangements | |||
Spread on variable interest rate | 4.25% |
Borrowing Arrangements - Carryi
Borrowing Arrangements - Carrying amounts of borrowings (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Borrowing Arrangements | ||
Loan payable, current | $ 20,977 | $ 10,486 |
Loan payable, noncurrent | 663 | 11,351 |
Total loan payable | 21,640 | |
SQN Equipment Loan | ||
Borrowing Arrangements | ||
Loan payable, current | 876 | 784 |
Loan payable, noncurrent | 663 | $ 1,490 |
Total loan payable | 1,539 | |
Amended and Restated Loan and Security Agreement [Member] | ||
Borrowing Arrangements | ||
Loan payable, current | 20,101 | |
Total loan payable | $ 20,101 |
Borrowing Arrangements - Compon
Borrowing Arrangements - Components of loss on debt extinguishment (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 25, 2022 | Oct. 13, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||||
Loss on debt extinguishment | $ (51,903) | $ (319) | ||
Loan and Security Agreement | ||||
Debt Instrument [Line Items] | ||||
Carrying value of extinguished debt | $ 6,000 | |||
Loss on debt extinguishment | $ 300 | |||
Loan and Security Agreement | August 2022 Bridge Note Agreement | ||||
Debt Instrument [Line Items] | ||||
Carrying value of extinguished debt | 30,407 | |||
Accrued interest | 520 | |||
Loss on debt extinguishment | $ 10,100 | (10,130) | ||
New LSA | August 2022 Bridge Note Agreement | ||||
Debt Instrument [Line Items] | ||||
Fair value of 2022 Promissory Notes | (28,154) | |||
LSA Convertible Note | August 2022 Bridge Note Agreement | ||||
Debt Instrument [Line Items] | ||||
Fair value of 2022 Promissory Notes | $ (12,903) |
Borrowing Arrangements - Debt e
Borrowing Arrangements - Debt extinguishment recorded in the consolidated statements of operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 22, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||
Fair value of stock issued | $ (19,074) | ||
Payment of debt issuance costs | (111) | $ (765) | |
Financing fees | (1,000) | ||
Loss on debt extinguishment | 51,903 | $ 319 | |
Amended and Restated Loan and Security Agreement | |||
Debt Instrument [Line Items] | |||
Carrying value of extinguished debt | 29,351 | ||
Fair value of 2022 Promissory Notes | (20,000) | ||
Principal repayment | $ (3,000) | (3,000) | |
Financing fees | (614) | ||
Loss on debt extinguishment | $ (13,300) | (13,338) | |
Amended and Restated Loan and Security Agreement | Common Stock | |||
Debt Instrument [Line Items] | |||
Fair value of stock issued | (7,336) | ||
Amended and Restated Loan and Security Agreement | Incentive PIPE Shares | |||
Debt Instrument [Line Items] | |||
Fair value of stock issued | (11,738) | ||
Amended and Restated Loan and Security Agreement | Additional Period Shares | |||
Debt Instrument [Line Items] | |||
Fair value of stock issued | $ (1) |
Borrowing Arrangements - SQN Eq
Borrowing Arrangements - SQN Equipment Loan (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Borrowing Arrangements | ||
Total loan payable | $ 22,302 | |
Add: accretion of final interest payable | 243 | |
Less: loan payable, current | $ (20,977) | (10,486) |
Less: unamortized debt discount | (708) | |
Total loan payable, noncurrent | 663 | 11,351 |
SQN Equipment Loan | ||
Borrowing Arrangements | ||
Total loan payable | 1,472 | 2,302 |
Add: accretion of final interest payable | 106 | 56 |
Less: loan payable, current | (876) | (784) |
Less: unamortized debt discount | (39) | (84) |
Total loan payable, noncurrent | 663 | $ 1,490 |
A&R LSA (FVO) | ||
Borrowing Arrangements | ||
Less: loan payable, current | $ (20,101) |
Borrowing Arrangements - A&R LS
Borrowing Arrangements - A&R LSA (Details) - A&R LSA (FVO) - Level 3 $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Borrowing Arrangements | |
Balance, January 1, 2022 | $ 0 |
Additions | 20,000 |
Payments | (250) |
Change in fair value | 351 |
Balance, December 31, 2022 | $ 20,101 |
Borrowing Arrangements - LSA Co
Borrowing Arrangements - LSA Convertible Note (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Borrowing Arrangements | |
Fair value recurring basis unobservable input reconciliation liability gain loss statement of income extensible list not disclosed flag | true |
LSA Convertible Note | Level 3 | |
Borrowing Arrangements | |
Balance, January 1, 2022 | $ 0 |
Additions | 12,902 |
Change in fair value | 2,527 |
Converted to common stock | (15,429) |
Balance, December 31, 2022 | 0 |
Converted to common stock reclassified in additional paid-in capital | $ (15,600) |
Borrowing Arrangements - Conver
Borrowing Arrangements - Convertible note, fair value (Details) | Dec. 31, 2022 Y |
Expected term | |
Borrowing Arrangements | |
Convertible note, fair value | 3 |
Discount rate | |
Borrowing Arrangements | |
Convertible note, fair value | 13.42 |
Borrowing Arrangements - Balanc
Borrowing Arrangements - Balances and Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Borrowing Arrangements | ||
Total notes payable | $ 22,302 | |
Add: accretion of final interest payable | 243 | |
Less: loan payable, current | $ (20,977) | (10,486) |
Less: unamortized debt discount | (708) | |
Loan payable, noncurrent | 663 | 11,351 |
LSA Tranche 1.1 | ||
Borrowing Arrangements | ||
Total notes payable | 10,000 | |
Add: accretion of final interest payable | 108 | |
Less: loan payable, current | (9,702) | |
Less: unamortized debt discount | (406) | |
LSA Tranche 1.2 | ||
Borrowing Arrangements | ||
Total notes payable | 10,000 | |
Add: accretion of final interest payable | 79 | |
Less: unamortized debt discount | (218) | |
Loan payable, noncurrent | 9,861 | |
SQN Equipment Loan | ||
Borrowing Arrangements | ||
Total notes payable | 1,472 | 2,302 |
Add: accretion of final interest payable | 106 | 56 |
Less: loan payable, current | (876) | (784) |
Less: unamortized debt discount | (39) | (84) |
Loan payable, noncurrent | $ 663 | $ 1,490 |
Borrowing Arrangements - Notes
Borrowing Arrangements - Notes payable future principal payments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Future Principal Payments | |
2023 | $ 1,205 |
2024 | 4,885 |
2025 | 15,550 |
Total future principal payments | $ 21,640 |
Borrowing Arrangements - Rela_3
Borrowing Arrangements - Related Party - Convertible Promissory Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 18, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Borrowing Arrangements Related Party | |||
Gross proceeds of convertible promissory notes | $ 5,000 | ||
Loss on extinguishment of debt | $ (51,903) | $ (319) | |
2022 Promissory Notes | |||
Borrowing Arrangements Related Party | |||
Interest rate of per annum | 10% | ||
Carrying value of extinguished debt | 5,265 | ||
Fair value of embedded derivative | $ 100 | 154 | |
Fair value of 2022 Promissory Notes | (19,030) | ||
Fair value of issued warrants | (3,568) | ||
Loss on extinguishment of debt | $ 17,200 | (17,179) | |
Amended and Restated 2022 Promissory [Member] | |||
Borrowing Arrangements Related Party | |||
Fair value change on derivatives | 40 | ||
Loss on extinguishment of debt | $ 200 |
Borrowing Arrangements - Rela_4
Borrowing Arrangements - Related Party - Bridge Note (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Sep. 30, 2022 | May 19, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Jul. 01, 2022 | |
Borrowing Arrangements Related Party | |||||
Loss on extinguishment of debt | $ (51,903) | $ (319) | |||
Bridge Note | |||||
Borrowing Arrangements Related Party | |||||
Obligation of debt | $ 5,000 | ||||
Advanced from principal amount | $ 4,600 | ||||
Interest rate of per annum | 12% | ||||
Carrying value of extinguished debt | 4,477 | ||||
Fair value of embedded derivative | $ 100 | ||||
Fair value of Bridge Note | (16,106) | ||||
Loss on extinguishment of debt | (11,629) | ||||
Bridge Note | Convertible Debt | |||||
Borrowing Arrangements Related Party | |||||
Fair value change on derivatives | 61 | ||||
Loss on extinguishment of debt | $ 11,600 |
Borrowing Arrangements - Rela_5
Borrowing Arrangements - Related Party - August 2022 Bridge Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 25, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 12, 2020 | |
Borrowing Arrangements Related Party | ||||
Cash proceeds | $ 10,637 | |||
Notes payable | 600 | |||
Other financing cost | 30,793 | $ 8,955 | ||
Working Capital Facility | ||||
Borrowing Arrangements Related Party | ||||
Principal amount | $ 600 | |||
Notes payable | $ 600 | |||
August 2022 Bridge Notes | ||||
Borrowing Arrangements Related Party | ||||
Cash proceeds | $ 1,200 | |||
Notes payable | 4,400 | |||
Other financing cost | $ 3,200 | |||
Interest rate of per annum | 10% | |||
August 2022 Bridge Notes | Loan and Security Agreement | ||||
Borrowing Arrangements Related Party | ||||
Principal amount | $ 5,000 | |||
Cash proceeds | 1,400 | |||
Cancellation of remaining debt facility | $ 3,600 |
Borrowing Arrangements - Rela_6
Borrowing Arrangements - Related Party - Net carrying amount of related party borrowings (Details) - August 2022 Bridge Notes - Level 3 $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Borrowing Arrangements | |
Balance, January 1, 2022 | $ 0 |
Additions | 39,593 |
Change in fair value | 7,887 |
Converted to common stock | (47,480) |
Balance, December 31, 2022 | 0 |
Converted to common stock reclassified in additional paid-in capital | $ (47,300) |
Stockholders' Equity (Deficit_2
Stockholders' Equity (Deficit) - Total shares of common stock reserved (Details) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Stockholders' Equity (Deficit) | |||
Common stock, shares authorized | 600,000,000 | 600,000,000 | |
Common stock, par value per share | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | |
Preferred stock, par value per share | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Stockholders' Equity (Deficit_3
Stockholders' Equity (Deficit) (Details) | Dec. 31, 2022 shares |
Class of Stock [Line Items] | |
Total shares of common stock reserved | 32,120,077 |
Warrants | |
Class of Stock [Line Items] | |
Total shares of common stock reserved | 18,106,559 |
Options to purchase common stock and RSUs | |
Class of Stock [Line Items] | |
Total shares of common stock reserved | 4,374,189 |
Shares reserved for future grants | |
Class of Stock [Line Items] | |
Total shares of common stock reserved | 2,639,329 |
Earnout shares | |
Class of Stock [Line Items] | |
Total shares of common stock reserved | 7,000,000 |
Warrants (Details)
Warrants (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||||||
Nov. 22, 2022 | Aug. 25, 2022 | Jun. 20, 2022 | Jan. 20, 2022 | Oct. 31, 2021 | Jun. 30, 2021 | Jan. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Warrants | |||||||||
Merger and PIPE financing (In shares) | 90,948 | 6,606,572 | |||||||
Loan and Security Agreement | |||||||||
Warrants | |||||||||
Warrant exercise price | $ 2.82 | $ 2.82 | |||||||
Public warrants | |||||||||
Warrants | |||||||||
Warrants assumed | 11,499,987 | ||||||||
Private warrants | |||||||||
Warrants | |||||||||
Warrants assumed | 6,600,000 | ||||||||
Common Stock | |||||||||
Warrants | |||||||||
Shares issued upon exercise of warrants | 3,679,148 | ||||||||
Common stock one | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 6,572 | ||||||||
Warrants, exercise price per share | $ 16.17 | ||||||||
Common stock two | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 4,759,536 | ||||||||
Warrants, exercise price per share | $ 11.50 | ||||||||
Common stock three | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 468,750 | ||||||||
Warrants, exercise price per share | $ 11.50 | ||||||||
Warrant Classified As Equity | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 3,114,193 | 402,955 | 18,601 | 18,417 | 452,677 | ||||
Warrants, exercise price per share | $ 16.54 | $ 16.54 | $ 8.85 | $ 5.51 | |||||
Proceeds from issuance of warrants | $ 0 | ||||||||
Number of warrants | 27,600,000 | ||||||||
Warrant Classified As Equity | Common Stock | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 11,499,987 | ||||||||
Warrants, exercise price per share | $ 11.50 | ||||||||
Warrant Classified As Equity | Common stock one | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 31,121 | ||||||||
Warrants, exercise price per share | $ 5.51 | ||||||||
Warrant Classified As Equity | Common stock two | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 18,601 | ||||||||
Warrants, exercise price per share | $ 8.85 | ||||||||
Warrant Classified As Equity | Common stock three | |||||||||
Warrants | |||||||||
Merger and PIPE financing (In shares) | 402,955 | ||||||||
Warrants, exercise price per share | $ 16.54 |
Warrants - Liability classified
Warrants - Liability classified warrants (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jun. 30, 2021 shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Warrants | |||
Merger and PIPE financing (In shares) | 90,948 | 6,606,572 | |
Expected Term [Member] | Minimum [Member] | |||
Warrants | |||
Measurement input, warrants | 3.89 | ||
Expected Term [Member] | Maximum | |||
Warrants | |||
Measurement input, warrants | 9.48 | ||
Expected volatility | Minimum [Member] | |||
Warrants | |||
Measurement input, warrants | 64.29 | ||
Expected volatility | Maximum | |||
Warrants | |||
Measurement input, warrants | 64.44 | ||
Risk-free interest rate | Minimum [Member] | |||
Warrants | |||
Measurement input, warrants | 1.12 | ||
Risk-free interest rate | Maximum | |||
Warrants | |||
Measurement input, warrants | 1.52 | ||
Expected dividends | |||
Warrants | |||
Measurement input, warrants | 0 | ||
Common stock one | |||
Warrants | |||
Merger and PIPE financing (In shares) | 6,572 | ||
Warrants, exercise price per share | $ / shares | $ 16.17 | ||
Common stock two | |||
Warrants | |||
Merger and PIPE financing (In shares) | 4,759,536 | ||
Warrants, exercise price per share | $ / shares | $ 11.50 | ||
Common stock three | |||
Warrants | |||
Merger and PIPE financing (In shares) | 468,750 | ||
Warrants, exercise price per share | $ / shares | $ 11.50 | ||
Common stock four | |||
Warrants | |||
Merger and PIPE financing (In shares) | 891,714 | ||
Warrants, exercise price per share | $ / shares | $ 11.50 | ||
Common stock five | |||
Warrants | |||
Merger and PIPE financing (In shares) | 480,000 | ||
Warrants, exercise price per share | $ / shares | $ 11.50 | ||
Warrant Classified As Liability | |||
Warrants | |||
Merger and PIPE financing (In shares) | 130,407 | ||
Warrants outstanding-January 1 | $ | $ 5,573 | $ 86 | |
Warrants issued and modified | $ | 32,514 | 1,245 | |
Assumed from ACE upon Closing | $ | 1,122 | ||
Exercised and converted to common stock upon Closing | $ | (38,389) | ||
Change in fair value, net | $ | (431) | 4,242 | |
Warrants outstanding-December 31 | $ | $ 389 | $ 5,573 | |
Warrant Classified As Liability | Common stock one | |||
Warrants | |||
Merger and PIPE financing (In shares) | 10,016 | ||
Warrants, exercise price per share | $ / shares | $ 6.74 | ||
Warrant Classified As Liability | Common stock two | |||
Warrants | |||
Merger and PIPE financing (In shares) | 4,453 | ||
Warrants, exercise price per share | $ / shares | $ 6.74 | ||
Warrant Classified As Liability | Common stock three | |||
Warrants | |||
Merger and PIPE financing (In shares) | 6,573 | ||
Warrants, exercise price per share | $ / shares | $ 16.19 | ||
Warrant Classified As Liability | Common stock four | |||
Warrants | |||
Merger and PIPE financing (In shares) | 18,417 | ||
Warrants, exercise price per share | $ / shares | $ 5.51 | ||
Warrant Classified As Liability | Common stock five | |||
Warrants | |||
Merger and PIPE financing (In shares) | 90,948 | ||
Warrants, exercise price per share | $ / shares | $ 8.85 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2022 USD ($) shares | Aug. 31, 2022 item shares | Mar. 31, 2022 item shares | Mar. 31, 2021 shares | Apr. 30, 2015 shares | Dec. 31, 2022 USD ($) shares | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) | Nov. 30, 2022 shares | |
Stock-Based Compensation | ||||||||||
Number of options vested | 627,299 | |||||||||
Vested and expected to vest | 2,549,745 | 2,549,745 | 2,549,745 | |||||||
Unrecognized expense associated with remaining options | $ | $ 3,400 | $ 3,400 | $ 3,400 | |||||||
Number of shares for which performance condition was not met | 918,392 | |||||||||
Stock-based compensation expense | $ | $ 11,289 | $ 2,538 | ||||||||
Shares expected to vest | 860,064 | 860,064 | 860,064 | |||||||
Options granted | 705,520 | |||||||||
Earnout Arrangement with holders of Legacy Tempo common stock and outstanding equity awards | ||||||||||
Stock-Based Compensation | ||||||||||
Number of Earnout Shares accounted for under ASC 718, given to common stock, option and RSU holders that are held by current employees and directors | 1,824,463 | |||||||||
Equity Incentive Plan , 2015 [Member] | ||||||||||
Stock-Based Compensation | ||||||||||
Number of options vested | 1,071,909 | |||||||||
Number of post merger common stock vested | 182,787 | |||||||||
Vested and expected to vest | 127,056 | 127,056 | 127,056 | |||||||
Number of post merger common stock that will vest monthly over the next twelve months | 21,667 | 21,667 | 21,667 | |||||||
Unrecognized expense associated with remaining options | $ | $ 700 | $ 700 | $ 700 | |||||||
Stock-based compensation expense | $ | $ 6,400 | |||||||||
Outstanding stock options | Chief Financial Officer [Member] | ||||||||||
Stock-Based Compensation | ||||||||||
Shares authorized | 258,368 | |||||||||
Vesting percentage per year | 100% | |||||||||
Vesting period | 36 months | |||||||||
Outstanding stock options | Management [Member] | ||||||||||
Stock-Based Compensation | ||||||||||
Shares authorized | 1,245,641 | |||||||||
Vesting percentage per year | 100% | |||||||||
Outstanding stock options | Equity Incentive Plan , 2015 [Member] | ||||||||||
Stock-Based Compensation | ||||||||||
Expiration period | 10 years | |||||||||
Vesting percentage per year | 25% | |||||||||
Forfeiture period | 3 years | |||||||||
Vesting period | 3 months | |||||||||
Performance Shares [Member] | ||||||||||
Stock-Based Compensation | ||||||||||
Number of executives terminated | item | 3 | 1 | ||||||||
Stock-based compensation on modified award | $ | $ 0 | $ 0 | ||||||||
Vesting period | 3 months | |||||||||
Shares expected to vest | 867,461 | 330,708 | ||||||||
Share based compensation arrangement by cancellation | 254,113 | |||||||||
Options granted | 50,931 |
Stock-Based Compensation - 2022
Stock-Based Compensation - 2022 Incentive Award Plan (Details) - shares | 1 Months Ended | 12 Months Ended |
Nov. 30, 2022 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common Stock, Capital Shares Reserved for Future Issuance | 32,120,077 | |
Incentive Award Plan 2022 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-Based Compensation Arrangement by Share-Based Payment Award, Percentage of Outstanding Stock Maximum | 12% | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Increase in Percentage of Outstanding Stock Maximum | 5% | |
Outstanding stock options | Incentive Award Plan 2022 [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common Stock, Capital Shares Reserved for Future Issuance | 3,896,412 | |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |
Vesting percentage | 25% | |
Forfeiture period | 3 years | |
Vesting period | 3 months | |
Shares authorized | 2,639,329 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Unit Issuance (Details) - USD ($) | 12 Months Ended | |||
Sep. 27, 2022 | Sep. 09, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 11,289,000 | $ 2,538,000 | ||
Restricted stock unit | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award issued | 9,500,000 | |||
Vesting percentage | 50% | |||
Quarterly revenue threshold for vesting | $ 29,000 | |||
Adjusted EBITDA threshold for vesting | $ 5,000,000 | |||
Total fair value | $ 4,300,000 | |||
Stock-based compensation expense | $ 0 | |||
Restricted stock unit | Vest upon achieving $15.0 million in quarterly revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 33.33% | |||
Vesting period | 2 years | |||
Service based restricted stock unit | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award issued | 4,750,000 | |||
Performance-based earnout shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award issued | 4,750,000 | |||
Quarterly revenue threshold for vesting | $ 15,000,000 |
Stock-Based Compensation - Opti
Stock-Based Compensation - Option Activity (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Number of shares | ||
Outstanding, beginning of period, number | shares | 16,457,475 | |
Number of shares retrospective application of recapitalization | shares | (13,651,211) | |
Options adjusted balance - beginning of period | shares | 2,806,264 | |
Options granted | shares | 705,520 | |
Options exercised | shares | 8,184 | |
Options forfeited | shares | 713,205 | |
Options expired | shares | 36,196 | |
Outstanding, end of period, number | shares | 2,754,199 | 16,457,475 |
Vested during the period, number | shares | 627,299 | |
Vested at end of period | shares | 1,894,115 | |
Exercisable at the end of the period | shares | 1,894,115 | |
Shares expected to vest | shares | 860,064 | |
Vested and expected to vest | shares | 2,549,745 | |
Weighted Average exercise price per share | ||
Outstanding at beginning of period | $ / shares | $ 1.36 | |
Options retrospective application of recapitalization | $ / shares | 6.85 | |
Options adjusted balance beginning | $ / shares | 8.21 | |
Options granted | $ / shares | 6.85 | |
Options exercised | $ / shares | 6.01 | |
Options forfeited | $ / shares | 13.33 | |
Options expired | $ / shares | 6.92 | |
Outstanding at period end | $ / shares | 4.73 | $ 1.36 |
Vested during the period | $ / shares | 9.25 | |
Vested at end of period, exercise price | $ / shares | 6.52 | |
Exercisable at the end of the period, exercise price | $ / shares | 6.52 | |
Shares expected to vest, exercise price | $ / shares | 5.24 | |
Vested and expected to vest | $ / shares | $ 6.26 | |
Weighted average contractual term (in years) | ||
Weighted average contractual term | 7 years 5 months 15 days | 7 years 11 months 15 days |
Adjusted balance - beginning of period | 7 years 11 months 15 days | |
Vested during the period | 6 years 9 months | |
Vested at end of period | 5 years 8 months 8 days | |
Exercisable at the end of the period, contractual term | 5 years 8 months 8 days | |
Shares expected to vest | 9 years 2 months 12 days | |
Vested and expected to vest | 6 years 8 months 15 days | |
Aggregate intrinsic value (in thousands) | ||
Aggregate intrinsic value | $ | $ 77 | $ 104,554 |
Adjusted balance beginning of period aggregate intrinsic value | $ | 104,554 | |
Vested at end of period | $ | 77 | |
Exercisable at the end of the period, aggregate intrinsic value | $ | 77 | |
Vested and expected to vest, aggregate intrinsic value | $ | $ 77 |
Stock-Based Compensation - RSU
Stock-Based Compensation - RSU activity (Details) - Restricted Stock Units (RSUs) [Member] - $ / shares | 12 Months Ended | |
Sep. 09, 2022 | Dec. 31, 2022 | |
Number of Awards Outstanding | ||
Granted | 9,500,000 | |
2015 Equity Incentive Plan | ||
Number of Awards Outstanding | ||
Granted | 1,662,620 | |
Forfeited | (42,630) | |
Unvested Balance - December 31, 2022 | 1,619,990 | |
Weighted-Average Grant Date Fair Value | ||
Granted | $ 22.25 | |
Forfeited | 22.59 | |
Unvested Balance - December 31, 2022 | $ 22.25 |
Stock-Based Compensation - Op_2
Stock-Based Compensation - Options valuation (Details) - Outstanding stock options | 12 Months Ended |
Dec. 31, 2022 | |
Fair value of option granted | |
Expected dividends | 0% |
Minimum | |
Fair value of option granted | |
Expected term | 6 months |
Expected volatility | 55.92% |
Risk free interest rate | 1.54% |
Maximum | |
Fair value of option granted | |
Expected term | 6 years |
Expected volatility | 70.39% |
Risk free interest rate | 3.71% |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense allocation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stock-based compensation expense | ||
Total stock-based compensation expense | $ 11,289 | $ 2,538 |
Unrecognized stock-based compensation expense, options | $ 3,400 | |
Period for recognition | 2 years 5 months 26 days | |
Service based restricted stock unit | ||
Stock-based compensation expense | ||
Unrecognized stock-based compensation expense, options | $ 6,900 | |
Period for recognition | 2 years 8 months 8 days | |
Performance-based earnout shares | ||
Stock-based compensation expense | ||
Period for recognition | 11 months 12 days | |
Stock-based compensation expense related to secondary sale transaction | $ 700 | |
Cost of goods sold | ||
Stock-based compensation expense | ||
Total stock-based compensation expense | 501 | 276 |
Research and development | ||
Stock-based compensation expense | ||
Total stock-based compensation expense | 1,615 | 540 |
Sales and marketing | ||
Stock-based compensation expense | ||
Total stock-based compensation expense | 465 | 402 |
General and administrative | ||
Stock-based compensation expense | ||
Total stock-based compensation expense | $ 8,708 | $ 1,320 |
Stock-Based Compensation - Earn
Stock-Based Compensation - Earnout Shares (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Performance-based earnout shares | |
Fair value of option granted | |
Unrecognized stock-based compensation expense | $ 2.1 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 08, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Operating lease-related assets and liabilities | |||
Operating lease assets | $ 371 | $ 1,323 | |
Operating lease liability, current | 516 | 1,111 | |
Operating lease liability, noncurrent | $ 30 | 546 | |
Estimated incremental borrowing rate | 8.95% | ||
Impairment charge on right of use assets | $ 100 | ||
Impairment charge of assets | $ 200 | ||
Operating lease-related income and expenses | |||
Rent expense recorded | $ 1,000 | $ 1,000 | |
Future minimum lease payments under non-cancelable operating leases | |||
2023 | 531 | ||
2024 | 29 | ||
Total future lease payments | 560 | ||
Less imputed interest | (14) | ||
Total operating lease liability | $ 546 |
Commitments and Contingencies -
Commitments and Contingencies - Finance leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finance lease-related assets and liabilities | ||
Finance lease assets | $ 3,383 | $ 3,943 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, Plant and Equipment, Net | Property, Plant and Equipment, Net |
Finance lease liability, current | $ 1,606 | $ 1,091 |
Finance lease liability, noncurrent | 1,606 | |
Finance lease-related income and expenses | ||
Depreciation of the leased asset | 2,072 | 547 |
Lease interest expense | 414 | $ 598 |
Future minimum lease payments under finance lease | ||
2023 | 1,731 | |
Total future lease payments | 1,731 | |
Less: imputed interest | (125) | |
Total finance lease liability | $ 1,606 |
Commitments and Contingencies_3
Commitments and Contingencies - Weighted average and cash flow information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Weighted average lease term, operating leases | 7 months 6 days | |
Weighted average lease term, finance leases | 6 months | |
Weighted average discount rate, operating leases | 8.95% | |
Weighted average discount rate, finance leases | 18.71% | |
Operating cash flows paid for operating leases | $ 1,215 | $ 1,184 |
Financing cash flows paid for finance leases | $ 1,504 | $ 1,504 |
Common Stock (Details)
Common Stock (Details) - $ / shares | Dec. 31, 2022 | Nov. 22, 2022 | Dec. 31, 2021 |
Class of Stock [Line Items] | |||
Common stock, shares authorized | 600,000,000 | 600,000,000 | |
Common stock, par value per share | $ 0.0001 | $ 0.0001 | |
Common stock, shares issued | 26,329,195 | 26,393,195 | 6,745,554 |
Common stock, shares outstanding | 26,329,195 | 6,745,554 | |
Common stock, shares reserved for issuance | 32,120,077 | ||
Warrants | |||
Class of Stock [Line Items] | |||
Common stock, shares reserved for issuance | 18,106,559 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income tax provisions | ||
Federal | $ 0 | |
State | 0 | |
Total current tax expense | $ 0 | |
Effective Income Tax Rate Reconciliation | ||
Statutory rate | 21% | 21% |
State income tax | 1.60% | 9.60% |
Permanent differences | (12.60%) | (6.80%) |
Valuation allowance | (10.00%) | (23.80%) |
Effective income tax rate | (0.00%) | (0.00%) |
Income Taxes - Deferred tax ass
Income Taxes - Deferred tax assets and liabilities, NOL, valuation allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Deferred tax asset (liability) | ||
Net operating losses | $ 34,780 | $ 26,070 |
Stock options and Warrants | 3,107 | |
Property, plant and equipment and intangibles | 2,620 | |
Accruals and other | 1,041 | 982 |
Total deferred tax assets | 41,548 | 27,052 |
valuation allowance | (40,333) | (25,648) |
Net deferred tax assets | 1,215 | 1,404 |
Property, plant, equipment, and intangibles | (1,125) | (1,017) |
Lease liability | (90) | (387) |
Total deferred tax liabilities | (1,215) | (1,404) |
Change in valuation allowance | 14,400 | $ 11,400 |
Domestic Tax Authority [Member] | ||
Deferred tax asset (liability) | ||
Net operating losses | 128,700 | |
State and Local Jurisdiction [Member] | ||
Deferred tax asset (liability) | ||
Net operating losses | $ 121,900 |
Income Taxes - Unrecognized tax
Income Taxes - Unrecognized tax benefit (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Unrecognized tax benefits | ||
Unrecognized tax benefits, beginning of period | $ 411 | $ 411 |
Unrecognized tax benefits, end of period | $ 411 | $ 411 |
Income Taxes - Operating loss c
Income Taxes - Operating loss carryfoward (Details) - USD ($) $ in Millions | Jan. 01, 2018 | Dec. 31, 2022 |
Operating Loss Carryforwards [Line Items] | ||
Percentage of income that can be offset | 80% | |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 128.7 | |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 121.9 |
Net Loss Per Share (Details)
Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Net Loss Per Share | ||
Net loss, basic | $ (144,851) | $ (48,013) |
Net loss, diluted | $ (1,448,851) | $ (48,013) |
Weighted-average number of shares of common stock outstanding, basic | 8,843,703 | 6,708,466 |
Weighted-average number of shares of common stock outstanding, diluted | 8,843,703 | 6,708,466 |
Net loss per share, basic | $ (16.38) | $ (7.16) |
Net loss per share, diluted | $ (16.38) | $ (7.16) |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive shares (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Net Loss Per Share | ||
Potential common shares excluded from diluted net loss per share | 22,480,748 | 3,389,348 |
Shares of common stock issuable from stock options and RSUs | ||
Net Loss Per Share | ||
Potential common shares excluded from diluted net loss per share | 4,374,189 | 2,806,264 |
Warrants, each whole warrant exerciseable for one share of common stock at an exercise price of $11.50 | ||
Net Loss Per Share | ||
Potential common shares excluded from diluted net loss per share | 18,106,559 | 583,084 |
Subsequent Events - Alameda Lea
Subsequent Events - Alameda Lease Extension (Details) | Feb. 16, 2023 |
Subsequent Event | |
Subsequent Event [Line Items] | |
Extension term of lease | 3 months |
Subsequent Events - Optimum Mer
Subsequent Events - Optimum Merger Agreement (Details) - Subsequent Event - ODA $ in Millions | Mar. 25, 2023 USD ($) installment shares |
Subsequent Event [Line Items] | |
Consideration | $ 6.8 |
Number of installments | installment | 3 |
Installment term | 1 year |
Shares of common stock awarded | shares | 4,400,000 |
Term within which common stock to be awarded | 5 days |
Additional consideration | $ 7.5 |
Subsequent Events - White Lion
Subsequent Events - White Lion Stock Purchase Agreement (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Jun. 30, 2021 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | ||
Number of shares issued | 90,948 | 6,606,572 |
White Lion Stock Purchase Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Number of shares issued | 350,000 | |
Gross proceeds from issuance of shares | $ 0.3 |