# embedding_metadata

key: chroma:document
string_value:
be	made	based	on	our	energy	market	participation	activities.	Such	guarantees	and	variable	customer	payments	represent	a	form	of	variable
consideration	and	are	estimated	at	contract	inception	at	their	most	likely	amount	and	updated	at	the	end	of	each	reporting	period	as	additional
performance	data	becomes	available.	Such	estimates	are	included	in	the	transaction	price	only	to	the	extent	that	it	is	probable	a	significant	reversal	of
revenue	will	not	occur.
We	record	as	deferred	revenue	any	non-refundable	amounts	that	are	collected	from	customers	related	to	fees	charged	for	prepayments	and
remote	monitoring	service	and	operations	and	maintenance	service,	which	is	recognized	as	revenue	ratably	over	the	respective	customer	contract
term.	
Energy	Generation	and	Storage	Leasing
For	revenue	arrangements	where	we	are	the	lessor	under	operating	lease	agreements	for	energy	generation	and	storage	products,	we	record
lease	revenue	from	minimum	lease	payments,	including	upfront	rebates	and	incentives	earned	from	such	systems,	on	a	straight-line	basis	over	the	life	of
the	lease	term,	assuming	all	other	revenue	recognition	criteria	have	been	met.	The	difference	between	the	payments	received	and	the	revenue
recognized	is	recorded	as	deferred	revenue	on	the	consolidated	balance	sheet.
For	solar	energy	systems	where	customers	purchase	electricity	from	us	under	PPAs	prior	to	January	1,	2019,	we	have	determined	that	these
agreements	should	be	accounted	for	as	operating	leases	pursuant	to	ASC	840.	Revenue	is	recognized	based	on	the	amount	of	electricity	delivered	at
rates	specified	under	the	contracts,	assuming	all	other	revenue	recognition	criteria	are	met.


key: chroma:document
string_value:
We	record	as	deferred	revenue	any	amounts	that	are	collected	from	customers,	including	lease	prepayments,	in	excess	of	revenue	recognized
and	operations	and	maintenance	service,	which	is	recognized	as	revenue	ratably	over	the	respective	customer	contract	term.	Deferred	revenue	also
includes	the	portion	of	rebates	and	incentives	received	from	utility	companies	and	various	local	and	state	government	agencies,	which	is	recognized	as
revenue	over	the	lease	term.
We	capitalize	initial	direct	costs	from	
the	execution	of	agreements	for	solar	energy	systems	
and	PPAs,	which	include	the	referral	fees	and	sales
commissions,	as	an	element	of	solar	energy	systems,	net,	and	subsequently	amortize	these	costs	over	the	term	of	the	related	agreements.
Inventory	Valuation
Inventories	are	stated	at	the	lower	of	cost	or	net	realizable	value.	Cost	is	computed	using	standard	cost	for	vehicles	and	energy	storage
products,	which	approximates	actual	cost	on	a	first-in,	first-out	basis.	In	addition,	cost	for	solar	energy	systems	is	recorded	using	actual	cost.	We	record
inventory	write-downs	for	excess	or	obsolete	inventories	based	upon	assumptions	about	current	and	future	demand	forecasts.	If	our	inventory	on-hand
is	in	excess	of	our	future	demand	forecast,	the	excess	amounts	are	written-off.
46


key: chroma:document
string_value:
We	also	review	our	inventory	to	determine	whether	its	carrying	value	exceeds	the	net	amount	realizable	upon	the	ultimate	sale	of	the	inventory.
This	requires	us	to	determine	the	estimated	selling	price	of	our	vehicles	less	the	estimated	cost	to	convert	the	inventory	on-hand	into	a	finished	product.
Once	inventory	is	written-down,	a	new,	lower	cost	basis	for	that	inventory	is	established	and	subsequent	changes	in	facts	and	circumstances	do	not
result	in	the	restoration	or	increase	in	that	newly	established	cost	basis.
Should	our	estimates	of	future	selling	prices	or	production	costs	change,	additional	and	potentially	material	increases	to	this	reserve	may	be
required.	A	small	change	in	our	estimates	may	result	in	a	material	charge	to	our	reported	financial	results.
Warranties
We	provide	a	manufacturer’s	warranty	on	all	new	and	used	vehicles	and	production	powertrain	components	and	systems	we	sell.	In	addition,	we
also	provide	a	warranty	on	the	installation	and	components	of	the	energy	generation	and	storage	systems	we	sell	for	periods	typically	between	10	to	25
years.	We	accrue	a	warranty	reserve	for	the	products	sold	by	us,	which	includes	our	best	estimate	of	the	projected	costs	to	repair	or	replace	items
under	warranties	and	recalls	when	identified.	These	estimates	are	based	on	actual	claims	incurred	to	date	and	an	estimate	of	the	nature,	frequency	and
costs	of	future	claims.	These	estimates	are	inherently	uncertain	given	our	relatively	short	history	of	sales,	and	changes	to	our	historical	or	projected
warranty	experience	may	cause	material	changes	to	the	warranty	reserve	in	the	future.	The	warranty	reserve	does	not	include	projected	warranty	costs


key: chroma:document
string_value:
associated	with	our	vehicles	subject	to	lease	accounting	and	our	solar	energy	systems	under	lease	contracts	or	PPAs,	as	the	costs	to	repair	these
warranty	claims	are	expensed	as	incurred.	The	portion	of	the	warranty	reserve	expected	to	be	incurred	within	the	next	12	months	is	included	within
accrued	liabilities	and	other,	while	the	remaining	balance	is	included	within	other	long-term	liabilities	on	the	consolidated	balance	sheets.	Warranty
expense	is	recorded	as	a	component	of	cost	of	revenues	in	the	consolidated	statements	of	operations.
Stock-Based	Compensation
We	use	the	fair	value	method	of	accounting	for	our	stock	options	and	restricted	stock	units	(“RSUs”)	granted	to	employees	and	our	employee
stock	purchase	plan	(the	“ESPP”)	to	measure	the	cost	of	employee	services	received	in	exchange	for	the	stock-based	awards.	The	fair	value	of	stock
option	awards	with	only	service	and/or	performance	conditions	and	ESPP	is	estimated	on	the	grant	or	offering	date	using	the	Black-Scholes	option-
pricing	model.	The	Black-Scholes	option-pricing	model	requires	inputs	such	as	the	risk-free	interest	rate,	expected	term	and	expected	volatility.	These
inputs	are	subjective	and	generally	require	significant	judgment.	The	fair	value	of	RSUs	is	measured	on	the	grant	date	based	on	the	closing	fair	market
value	of	our	common	stock.	The	resulting	cost	is	recognized	over	the	period	during	which	an	employee	is	required	to	provide	service	in	exchange	for	the
awards,	usually	the	vesting	period,	which	is	generally	four	years	for	stock	options	and	RSUs	and	six	months	for	the	ESPP.	Stock-based	compensation
expense	is	recognized	on	a	straight-line	basis,	net	of	actual	forfeitures	in	the	period.
For	performance-based	awards,	stock-based	compensation	expense	is	recognized	over	the	expected	performance	achievement	period	of


key: chroma:document
string_value:
individual	performance	milestones	when	the	achievement	of	each	individual	performance	milestone	becomes	probable.	For	performance-based	awards
with	a	vesting	schedule	based	entirely	on	the	attainment	of	both	performance	and	market	conditions,	stock-based	compensation	expense	associated
with	each	tranche	is	recognized	over	the	longer	of	(i)	the	expected	achievement	period	for	the	operational	milestone	for	such	tranche	and	(ii)	the
expected	achievement	period	for	the	related	market	capitalization	milestone	determined	on	the	grant	date,	beginning	at	the	point	in	time	when	the
relevant	operational	milestone	is	considered	probable	of	being	met.	If	such	operational	milestone	becomes	probable	any	time	after	the	grant	date,	we
will	recognize	a	cumulative	catch-up	expense	from	the	grant	date	to	that	point	in	time.	If	the	related	market	capitalization	milestone	is	achieved	earlier
than	its	expected	achievement	period	and	the	achievement	of	the	related	operational	milestone,	then	the	stock-based	compensation	expense	will	be
recognized	over	the	expected	achievement	period	for	the	operational	milestone,	which	may	accelerate	the	rate	at	which	such	expense	is	recognized.	If
additional	operational	milestones	become	probable,	stock-based	compensation	expense	will	be	recorded	in	the	period	it	becomes	probable	including
cumulative	catch-up	expense	for	the	service	provided	since	the	grant	date.	The	fair	value	of	such	awards	is	estimated	on	the	grant	date	using	Monte
Carlo	simulations.
47


key: chroma:document
string_value:
As	we	accumulate	additional	employee	stock-based	awards	data	over	time	and	as	we	incorporate	market	data	related	to	our	common	stock,	we
may	calculate	significantly	different	volatilities	and	expected	lives,	which	could	materially	impact	the	valuation	of	our	stock-based	awards	and	the	stock-
based	compensation	expense	that	we	will	recognize	in	future	periods.	Stock-based	compensation	expense	is	recorded	in	cost	of	revenues,	research	and
development	expense	and	selling,	general	and	administrative	expense	in	the	consolidated	statements	of	operations.
Income	Taxes
We	are	subject	to	federal	and	state	taxes	in	the	U.S.	and	in	many	foreign	jurisdictions.	Significant	judgment	is	required	in	determining	our
provision	for	income	taxes,	our	deferred	tax	assets	and	liabilities	and	any	valuation	allowance	recorded	against	our	net	deferred	tax	assets.	We	make
these	estimates	and	judgments	about	our	future	taxable	income	that	are	based	on	assumptions	that	are	consistent	with	our	future	plans.	Tax	laws,
regulations,	and	administrative	practices	may	be	subject	to	change	due	to	economic	or	political	conditions	including	fundamental	changes	to	the	tax
laws	applicable	to	corporate	multinationals.	The	U.S.,	many	countries	in	the	European	Union	and	a	number	of	other	countries	are	actively	considering
changes	in	this	regard.	As	of	December	31,	2019,	we	had	recorded	a	full	valuation	allowance	on	our	net	U.S.	deferred	tax	assets	because	we	expect	that
it	is	more	likely	than	not	that	our	U.S.	deferred	tax	assets	will	not	be	realized	in	the	foreseeable	future.	Should	the	actual	amounts	differ	from	our
estimates,	the	amount	of	our	valuation	allowance	could	be	materially	impacted.


key: chroma:document
string_value:
Furthermore,	significant	judgment	is	required	in	evaluating	our	tax	positions.	In	the	ordinary	course	of	business,	there	are	many	transactions
and	calculations	for	which	the	ultimate	tax	settlement	is	uncertain.	As	a	result,	we	recognize	the	effect	of	this	uncertainty	on	our	tax	attributes	based	on
our	estimates	of	the	eventual	outcome.	These	effects	are	recognized	when,	despite	our	belief	that	our	tax	return	positions	are	supportable,	we	believe
that	it	is	more	likely	than	not	that	those	positions	may	not	be	fully	sustained	upon	review	by	tax	authorities.	We	are	required	to	file	income	tax	returns
in	the	U.S.	and	various	foreign	jurisdictions,	which	requires	us	to	interpret	the	applicable	tax	laws	and	regulations	in	effect	in	such	jurisdictions.	Such
returns	are	subject	to	audit	by	the	various	federal,	state	and	foreign	taxing	authorities,	who	may	disagree	with	respect	to	our	tax	positions.	We	believe
that	our	consideration	is	adequate	for	all	open	audit	years	based	on	our	assessment	of	many	factors,	including	past	experience	and	interpretations	of
tax	law.	We	review	and	update	our	estimates	in	light	of	changing	facts	and	circumstances,	such	as	the	closing	of	a	tax	audit,	the	lapse	of	a	statute	of
limitations	or	a	change	in	estimate.	To	the	extent	that	the	final	tax	outcome	of	these	matters	differs	from	our	expectations,	such	differences	may	impact
income	tax	expense	in	the	period	in	which	such	determination	is	made.	The	eventual	impact	on	our	income	tax	expense	depends	in	part	if	we	still	have	a
valuation	allowance	recorded	against	our	deferred	tax	assets	in	the	period	that	such	determination	is	made.
Principles	of	Consolidation


key: chroma:document
string_value:
Principles	of	Consolidation
The	consolidated	financial	statements	reflect	our	accounts	and	operations	and	those	of	our	subsidiaries	in	which	we	have	a	controlling	financial
interest.	In	accordance	with	the	provisions	of	ASC	810,	
Consolidation
,	we	consolidate	any	variable	interest	entity	(“VIE”)	of	which	we	are	the	primary
beneficiary.	We	form	VIEs	with	our	financing	fund	investors	in	the	ordinary	course	of	business	in	order	to	facilitate	the	funding	and	monetization	of
certain	attributes	associated	with	our	solar	energy	systems	and	
leases	under	our	direct	vehicle	leasing	programs
.	The	typical	condition	for	a	controlling
financial	interest	ownership	is	holding	a	majority	of	the	voting	interests	of	an	entity;	however,	a	controlling	financial	interest	may	also	exist	in	entities,
such	as	VIEs,	through	arrangements	that	do	not	involve	controlling	voting	interests.	ASC	810	requires	a	variable	interest	holder	to	consolidate	a	VIE	if
that	party	has	the	power	to	direct	the	activities	of	the	VIE	that	most	significantly	impact	the	VIE’s	economic	performance	and	the	obligation	to	absorb
losses	of	the	VIE	that	could	potentially	be	significant	to	the	VIE	or	the	right	to	receive	benefits	from	the	VIE	that	could	potentially	be	significant	to	the
VIE.	We	do	not	consolidate	a	VIE	in	which	we	have	a	majority	ownership	interest	when	we	are	not	considered	the	primary	beneficiary.	We	have
determined	that	we	are	the	primary	beneficiary	of	all	the	VIEs.	We	evaluate	our	relationships	with	all	the	VIEs	on	an	ongoing	basis	to	ensure	that	we
continue	to	be	the	primary	beneficiary.	All	intercompany	transactions	and	balances	have	been	eliminated	upon	consolidation.
48


key: chroma:document
string_value:
Noncontrolling	Interests	and	Redeemable	Noncontrolling	Interests
Noncontrolling	interests	and	redeemable	noncontrolling	interests	represent	third-party	interests	in	the	net	assets	under	certain	funding
arrangements,	or	funds,	that	we	enter	into	to	finance	the	costs	of	solar	energy	systems	and	vehicles	under	operating	leases.	We	have	determined	that
the	contractual	provisions	of	the	funds	represent	substantive	profit	sharing	arrangements.	We	have	further	determined	that	the	appropriate
methodology	for	calculating	the	noncontrolling	interest	and	redeemable	noncontrolling	interest	balances	that	reflects	the	substantive	profit	sharing
arrangements	is	a	balance	sheet	approach	using	the	hypothetical	liquidation	at	book	value	(“HLBV”)	method.	We,	therefore,	determine	the	amount	of
the	noncontrolling	interests	and	redeemable	noncontrolling	interests	in	the	net	assets	of	the	funds	at	each	balance	sheet	date	using	the	HLBV	method,
which	is	presented	on	the	consolidated	balance	sheet	as	noncontrolling	interests	in	subsidiaries	and	redeemable	noncontrolling	interests	in	subsidiaries.
Under	the	HLBV	method,	the	amounts	reported	as	noncontrolling	interests	and	redeemable	noncontrolling	interests	in	the	consolidated	balance	sheet
represent	the	amounts	the	third-parties	would	hypothetically	receive	at	each	balance	sheet	date	under	the	liquidation	provisions	of	the	funds,	assuming
the	net	assets	of	the	funds	were	liquidated	at	their	recorded	amounts	determined	in	accordance	with	GAAP	and	with	tax	laws	effective	at	the	balance
sheet	date	and	distributed	to	the	third-parties.	The	third-parties’	interests	in	the	results	of	operations	of	the	funds	are	determined	as	the	difference	in


key: chroma:document
string_value:
the	noncontrolling	interest	and	redeemable	noncontrolling	interest	balances	in	the	consolidated	balance	sheets	between	the	start	and	end	of	each
reporting	period,	after	taking	into	account	any	capital	transactions	between	the	funds	and	the	third-parties.	However,	the	redeemable	noncontrolling
interest	balance	is	at	least	equal	to	the	redemption	amount.	The	redeemable	noncontrolling	interest	balance	is	presented	as	temporary	equity	in	the
mezzanine	section	of	the	consolidated	balance	sheet	since	these	third-parties	have	the	right	to	redeem	their	interests	in	the	funds	for	cash	or	other
assets.
	
	
Results	of	Operations
Revenues
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Automotive	sales
	
$
19,952
	
	
$
17,632
	
	
$
8,535
	
	
$
2,320
	
	
	
13
%
	
$
9,097
	
	
	
107
%
Automotive	leasing
	
	
869
	
	
	
883
	
	
	
1,107
	
	
	
(14
)
	
	
-2
%
	
	
(224
)
	
	
-20
%
Total	automotive	revenues
	
	
20,821
	
	
	
18,515
	
	
	
9,642
	
	
	
2,306
	
	
	
12
%
	
	
8,873
	
	
	
92
%
Services	and	other


key: chroma:document
string_value:
92
%
Services	and	other
	
	
2,226
	
	
	
1,391
	
	
	
1,001
	
	
	
835
	
	
	
60
%
	
	
390
	
	
	
39
%
Total	automotive	&	services
			and	other	segment	revenue
	
	
23,047
	
	
	
19,906
	
	
	
10,643
	
	
	
3,141
	
	
	
16
%
	
	
9,263
	
	
	
87
%
Energy	generation	and
			storage	segment	revenue
	
	
1,531
	
	
	
1,555
	
	
	
1,116
	
	
	
(24
)
	
	
-2
%
	
	
439
	
	
	
39
%
Total	revenues
	
$
24,578
	
	
$
21,461
	
	
$
11,759
	
	
$
3,117
	
	
	
15
%
	
$
9,702
	
	
	
83
%
	
Automotive	&	Services	and	Other	Segment
Automotive	sales	revenue	includes	revenues	related	to	cash	sales	of	new	Model	S,	Model	X	and	Model	3	vehicles,	including	access	to	our
Supercharger	network,	internet	connectivity,	Autopilot	and	FSD	features	and	over-the-air	software	updates,	as	well	as	sales	of	regulatory	credits	to
other	automotive	manufacturers.	Cash	deliveries	are	vehicles	that	are	not	subject	to	lease	accounting.
Automotive	leasing	revenue	includes	the	amortization	of	revenue	for	Model	S,	Model	X	and	Model	3	vehicles	under	direct	lease	agreements	as


key: chroma:document
string_value:
well	as	those	sold	with	resale	value	guarantees	accounted	for	as	operating	leases	under	lease	accounting.	We	began	offering	direct	leasing	for	Model	3
vehicles	in	the	second	quarter	of	2019.
Services	and	other	revenue	consists	of	non-warranty	after-sales	vehicle	services,	sales	of	used	vehicles,	retail	merchandise,	sales	by	our
acquired	subsidiaries	to	third	party	customers,	and	vehicle	insurance	revenue.
49


key: chroma:document
string_value:
201
9
	Compared	to	201
8
Automotive	sales	revenue	increased	$2.32	billion,	or	13%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended	December	31,
2018,	primarily	due	to	an	increase	of	137,969	Model	3	cash	deliveries	from	production	scaling	and	an	increase	of	$175	million	in	sales	of	regulatory
credits	to	$594	million.	The	increase	was	partially	offset	by	a	decrease	of	30,487	Model	S	and	Model	X	cash	deliveries.	The	deliveries	in	the	year	ended
December	31,	2019	were	at	lower	average	selling	prices	than	the	prior	year	due	to	price	adjustments	we	made	to	our	vehicle	offerings	and	the
introduction	of	lower	end	Model	3	trims	in	2019.	Due	to	the	price	adjustments,	we	estimated	that	there	is	a	greater	likelihood	that	customers	will
exercise	their	buyback	options	that	were	provided	prior	to	such	adjustments.	As	a	result,	along	with	the	estimated	variable	consideration	related	to
normal	future	product	returns	for	vehicles	sold	under	the	buyback	options	program,	we	adjusted	our	sales	return	reserve	on	vehicles	previously	sold
under	our	buyback	options	program	resulting	in	a	reduction	of	automotive	sales	revenues	of	$555	million.	Refer	to	Note	2,	
Summary	of	Significant
Accounting	Policies,
	to	the	consolidated	statements	included	elsewhere	in	this	Annual	Report	on	Form	10-K.
Automotive	leasing	revenue	decreased	$14	million,	or	2%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018.	The	decrease	was	primarily	due	to	a	decrease	in	cumulative	vehicles	under	our	resale	value	guarantee	leasing	programs	which	are


key: chroma:document
string_value:
accounted	for	as	operating	leases.	The	decrease	was	partially	offset	by	an	increase	in	cumulative	vehicles	under	our	direct	vehicle	leasing	program,
partially	due	to	the	introduction	of	Model	3	direct	leasing	in	the	second	quarter	of	2019.
Services	and	other	revenue	increased	$835	million,	or	60%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended	December	31,
2018.	The	increase	was	primarily	due	to	an	increase	in	used	vehicle	sales	from	an	increased	volume	of	trade-in	vehicles,	partially	offset	by	lower
average	selling	prices	for	traded-in	Tesla	vehicles	due	to	price	adjustments	we	made	to	our	vehicle	offerings	in	2019.	Additionally,	there	was	an
increase	in	non-warranty	maintenance	services	revenue	as	our	fleet	continues	to	grow.
Energy	Generation	and	Storage	Segment
Energy	generation	and	storage	revenue	includes	sales	and	leasing	of	solar	energy	generation	and	energy	storage	products,	services	related	to
such	products,	and	sales	of	solar	energy	systems	incentives.
2019	Compared	to	2018
Energy	generation	and	storage	revenue	decreased	by	$24	million,	or	2%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018,	primarily	due	to	decreases	in	deployments	of	solar	cash	and	loan	jobs	partially	offset	increases	in	deployments	of	Powerwall,
Powerpack,	and	Megapack.
50


key: chroma:document
string_value:
Cost	of	Revenues	and	Gross	Margin
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Cost	of	revenues
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Automotive	sales
	
$
15,939
	
	
$
13,686
	
	
$
6,725
	
	
$
2,253
	
	
	
16
%
	
$
6,961
	
	
	
104
%
Automotive	leasing
	
	
459
	
	
	
488
	
	
	
708
	
	
	
(29
)
	
	
-6
%
	
	
(220
)
	
	
-31
%
Total	automotive	cost
			of	revenues
	
	
16,398
	
	
	
14,174
	
	
	
7,433
	
	
	
2,224
	
	
	
16
%
	
	
6,741
	
	
	
91
%
Services	and	other
	
	
2,770
	
	
	
1,880
	
	
	
1,229
	
	
	
890
	
	
	
47
%
	
	
651
	
	
	
53
%
Total	automotive	&
			services	and	other
			segment	cost	of
			revenues
	
	
19,168
	
	
	
16,054
	
	
	
8,662


key: chroma:document
string_value:
8,662
	
	
	
3,114
	
	
	
19
%
	
	
7,392
	
	
	
85
%
Energy	generation	and
			storage	segment
	
	
1,341
	
	
	
1,365
	
	
	
874
	
	
	
(24
)
	
	
-2
%
	
	
491
	
	
	
56
%
Total	cost	of	revenues
	
$
20,509
	
	
$
17,419
	
	
$
9,536
	
	
$
3,090
	
	
	
18
%
	
$
7,883
	
	
	
83
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gross	profit	total	automotive
	
$
4,423
	
	
$
4,341
	
	
$
2,209
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gross	margin	total	automotive
	
	
21
%
	
	
23
%
	
	
23
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gross	profit	total	automotive	&
			services	and	other	segment
	
$
3,879
	
	
$
3,852
	
	
$
1,981


key: chroma:document
string_value:
Gross	margin	total	automotive	&
			services	and	other	segment
	
	
17
%
	
	
19
%
	
	
19
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gross	profit	energy	generation
			and	storage	segment
	
$
190
	
	
$
190
	
	
$
242
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gross	margin	energy	generation
			and	storage	segment
	
	
12
%
	
	
12
%
	
	
22
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Total	gross	profit
	
$
4,069
	
	
$
4,042
	
	
$
2,223
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Total	gross	margin
	
	
17
%
	
	
19
%
	
	
19
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Automotive	&	Services	and	Other	Segment


key: chroma:document
string_value:
Automotive	&	Services	and	Other	Segment
Cost	of	automotive	sales	revenue	includes	direct	parts,	material	and	labor	costs,	manufacturing	overhead,	including	depreciation	costs	of
tooling	and	machinery,	shipping	and	logistic	costs,	vehicle	connectivity	costs,	allocations	of	electricity	and	infrastructure	costs	related	to	our
Supercharger	network,	and	reserves	for	estimated	warranty	expenses.	Cost	of	automotive	sales	revenues	also	includes	adjustments	to	warranty	expense
and	charges	to	write	down	the	carrying	value	of	our	inventory	when	it	exceeds	its	estimated	net	realizable	value	and	to	provide	for	obsolete	and	on-
hand	inventory	in	excess	of	forecasted	demand.
Cost	of	automotive	leasing	revenue	includes	primarily	the	amortization	of	operating	lease	vehicles	over	the	lease	term,	as	well	as	warranty
expenses	recognized	as	incurred.	Cost	of	automotive	leasing	revenue	also	includes	vehicle	connectivity	costs	and	allocations	of	electricity	and
infrastructure	costs	related	to	our	Supercharger	network	for	vehicles	under	our	leasing	programs.
Costs	of	services	and	other	revenue	includes	costs	associated	with	providing	non-warranty	after-sales	
services
,	costs	to	acquire	and	certify	used
vehicles,	costs	for	retail	merchandise,	and	costs	to	provide	vehicle	insurance.	Cost	of	services	and	other	revenue	also	includes	direct	parts,	material	and
labor	costs,	manufacturing	overhead	associated	with	the	sales	by	our	acquired	subsidiaries	to	third	party	customers.
51


key: chroma:document
string_value:
201
9
	Compared	to	201
8
Cost	of	automotive	sales	revenue	increased	$2.25	billion,	or	16%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018,	primarily	due	to	an	increase	of	137,969	Model	3	cash	deliveries	and	higher	average	Model	S	and	Model	X	costs	per	unit	compared
to	the	prior	year	due	to	the	discontinuation	of	lower	end	trims	in	2019.	The	increases	were	partially	offset	by	a	decrease	of	30,487	Model	S	and	Model	X
cash	deliveries	and	a	decrease	in	average	Model	3	costs	per	unit	compared	to	the	prior	year	primarily	due	to	lower	end	trims	introduced	in	2019	and
temporary	under-utilization	of	manufacturing	capacity	at	lower	production	volumes	in	the	first	half	of	2018.	Additionally,	due	to	price	adjustments	we
made	to	our	vehicle	offerings	in	2019,	we	estimated	that	there	is	a	greater	likelihood	that	customers	will	exercise	their	buyback	options	that	were
provided	prior	to	such	adjustments.	If	customers	elect	to	exercise	the	buyback	options,	we	expect	to	be	able	to	subsequently	resell	the	returned
vehicles,	which	resulted	in	a	reduction	of	automotive	cost	of	sales	of	$451	million	for	the	year	ended	December	31,	2019.	Refer	to	Note	2,	
Summary	of
Significant	Accounting	Policies
,	to	the	consolidated	statements	included	elsewhere	in	this	Annual	Report	on	Form	10-K.
Cost	of	automotive	leasing	revenue	decreased	$29	million,	or	6%,	in	the	year	ended	December	31,	2019	compared	to	the	year	ended


key: chroma:document
string_value:
December	31,	2018.	The	decrease	was	primarily	due	to	a	decrease	in	cumulative	vehicles	under	our	resale	value	guarantee	leasing	programs	which	are
accounted	for	as	operating	leases.	The	decrease	was	partially	offset	by	an	increase	in	cumulative	vehicles	under	our	direct	vehicle	leasing	program,
partially	due	to	the	introduction	of	Model	3	leasing	in	the	second	quarter	of	2019.
Cost	of	services	and	other	revenue	increased	$890	million,	or	47%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018.	The	increase	was	primarily	due	to	the	costs	of	used	vehicle	sales	from	the	increased	volumes	of	trade-in	vehicles.	Additionally,
there	were	increases	in	the	costs	of	our	new	service	centers,	additional	service	personnel	in	existing	and	new	service	centers,	Mobile	Service
capabilities,	parts	distribution	centers	and	investment	in	new	body	shops	to	provide	maintenance	services	to	our	rapidly	growing	fleet	of	vehicles.
Gross	margin	for	total	automotive	decreased	from	23%	to	21%	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended	December
31,	2018,	primarily	due	to	lower	Model	S	and	Model	X	margins	from	lower	selling	prices	due	to	price	adjustments	we	made	to	our	vehicle	offerings	in
2019,	a	higher	proportion	of	Model	3	as	a	percentage	of	our	total	automotive	sales	compared	to	the	prior	period.	Additionally,	the	price	adjustments
also	resulted	in	a	reduction	in	gross	automotive	sales	profit	of	$104	million	from	the	adjustment	of	our	sales	return	reserve	on	vehicles	previously	sold


key: chroma:document
string_value:
under	our	buyback	options	program.	The	decrease	was	partially	offset	by	improvement	of	Model	3	margins	compared	to	the	prior	year	as	we	achieved
additional	manufacturing	efficiencies	in	the	production	of	Model	3	and	an	increase	of	$175	million	in	sales	of	regulatory	credits.
Gross	margin	for	total	automotive	&	services	and	other	segment	decreased	from	19%	to	17%	in	the	year	ended	December	31,	2019	as	compared
to	the	year	ended	December	31,	2018,	primarily	due	to	the	automotive	gross	margin	impacts	discussed	above	and	a	higher	proportion	of	services	and
other	within	the	segment,	which	operates	at	lower	gross	margins	than	our	automotive	business.
Energy	Generation	and	Storage	Segment
Cost	of	
energy	generation	and	storage	revenue	includes	direct	and	indirect	material	and	labor	costs,	warehouse	rent,	freight,	warranty	expense,
other	overhead	costs	and	amortization	of	certain	acquired	intangible	assets.	In	addition,	where	arrangements	are	accounted	for	as	operating	leases,	the
cost	of	revenue	is	primarily	comprised	of	depreciation	of	the	cost	of	leased	solar	energy	systems,	maintenance	costs	associated	with	those	systems	and
amortization	of	any	initial	direct	costs.
2019	Compared	to	2018
Cost	of	energy	generation	and	storage	revenue	decreased	by	$24	million	,	or	2%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year
ended	December	31,	2018.	The	decrease	was	primarily	due	to	a	decrease	in	deployments	of	solar	cash	and	loan	jobs,	partially	offset	by	increases	in
deployments	of	Powerwall,	Powerpack,	and	Megapack.
52


key: chroma:document
string_value:
Gross	margin	
for
	energy	generation	and	storage	
remained	relatively	consistent	at	12%	
in	the	year	ended	
December	31,	2019
	
as	
compared	to	the
year	ended	
December	31,	2018
.	
Energy	storage	gross	margins	improved	in	the	current	year	as	a	result	of	lower	materials	costs,	partially	offset	by	lower
gross	margins	in	our	cash	and	loan	solar	business	driven	by	higher	costs	from	temporary	manufacturing	under-utilization	of	our	Solar	
R
oof	ramp.
Research	and	Development	Expense
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Research	and	development
	
$
1,343
	
	
$
1,460
	
	
$
1,378
	
	
$
(117
)
	
	
-8
%
	
$
82
	
	
	
6
%
As	a	percentage	of	revenues
	
	
5
%
	
	
7
%
	
	
12
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Research	and	development	(“R&D”)	expenses	consist	primarily	of	personnel	costs	for	our	teams	in	engineering	and	research,	manufacturing
engineering	and	manufacturing	test	organizations,	prototyping	expense,	contract	and	professional	services	and	amortized	equipment	expense.


key: chroma:document
string_value:
R&D	expenses	as	a	percentage	of	revenue	decreased	from	7%	to	5%	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018.	The	decrease	was	primarily	from	an	increase	in	overall	revenues	from	our	expanding	sales,	as	well	as	from	our	focus	on	increasing
operational	efficiency	and	process	automation,	our	efforts	to	scale	down	and	optimize	our	cost	structure	relative	to	the	size	of	our	business.
R&D	expenses	decreased	$117	million,	or	8%,	in	the	year	ended	December	31,	2019	compared	to	the	year	ended	December	31,	2018.	The
decrease	was	primarily	due	to	a	$95	million	decrease	in	employee	and	labor	related	expenses	from	cost	efficiency	initiatives	and	a	$26	million	decrease
in	professional	and	outside	service	expenses.
Selling,	General	and	Administrative	Expense
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Selling,	general	and	administrative
	
$
2,646
	
	
$
2,835
	
	
$
2,477
	
	
$
(189
)
	
	
-7
%
	
$
358
	
	
	
14
%
As	a	percentage	of	revenues
	
	
11
%
	
	
13
%
	
	
21
%


key: chroma:document
string_value:
Selling,	general	and	administrative	(“SG&A”)	expenses	generally	consist	of	personnel	and	facilities	costs	related	to	our	stores,	marketing,	sales,
executive,	finance,	human	resources,	information	technology	and	legal	organizations,	as	well	as	fees	for	professional	and	contract	services	and	litigation
settlements.
SG&A	expenses	as	a	percentage	of	revenue	decreased	from	13%	to	11%	in	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018.	The	decrease	was	primarily	from	an	increase	in	overall	revenues	from	our	expanding	sales,	as	well	as	from	our	focus	on	increasing
operational	efficiency	and	process	automation,	our	efforts	to	scale	down	and	optimize	our	cost	structure	relative	to	the	size	of	our	business.
SG&A	expenses	decreased	$189	million,	or	7%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended	December	31,	2018.	The
decrease	was	primarily	due	to	a	$302	million	decrease	in	employee	and	labor	related	expenses	from	decreased	headcount	and	cost	efficiency	initiatives,
partially	offset	by	a	$112	million	increase	in	stock-based	compensation	expense.	The	increase	in	stock-based	compensation	expense	was	primarily
related	to	the	2018	CEO	Performance	Award	as	we	recorded	a	$72	million	cumulative	catch-up	expense	for	the	service	provided	from	the	grant	date
when	an	additional	operational	milestone	was	considered	probable	of	being	met	in	the	fourth	quarter	of	2019.	Additionally,	the	expense	period	was
shorter	in	the	prior	year	as	it	commenced	upon	the	grant	approval	date	of	March	21,	2018.
53


key: chroma:document
string_value:
Restructuring	and	other
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
Restructuring	and	other
	
$
149
	
	
$
135
	
	
$
—
	
	
$
14
	
	
10%
	
	
$
135
	
	
N/A
As	a	percentage	of	revenues
	
	
1
%
	
	
1
%
	
	
0
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
During	the	year	ended	December	31,	2019,	we	carried	out	certain	restructuring	actions	in	order	to	reduce	costs	and	improve	efficiency.	As	a
result,	we	recognized	$
50
	million	of	costs	primarily	related	to	employee	termination	expenses	and	losses	from	closing	certain	stores	impacting	both
segments.	We	recognized	$
47
	million	in	impairment	related	to	the	IPR&D	intangible	asset	as	we	abandoned	further	development	efforts	(refer	to	Note
4,	
Goodwill	and	Intangible	Assets
	for	details)	and	$
15
	million	for	the	related	equipment	within	the	energy	generation	and	storage	segment.	We	also
incurred	a	loss	of	$
37
	million	for	closing	operations	in	certain	facilities.	On	the	statement	of	cash	flows,	the	amounts	were	presented	in	the	captions	in
which	such	amounts	would	have	been	recorded	absent	the	impairment	charges.	The	employee	termination	expenses	were	substantially	paid	by


key: chroma:document
string_value:
December	31,	2019,	while	the	remaining	amounts	were	non-cash.
During	the	year	ended	December	31,	2018,	we	carried-out	certain	restructuring	actions	in	order	to	reduce	costs	and	improve	efficiency	and
recognized	$
37
	million	of	employee	termination	expenses	and	estimated	losses	from	sub-leasing	a	certain	facility.	The	employee	termination	cash	expenses
of	$
27
	million	were	substantially	paid	by	the	end	of	2018,	while	the	remaining	amounts	were	non-cash.	Also	included	within	restructuring	and	other
activities	was	$
55
	million	of	expenses	(materially	all	of	which	were	non-cash)	from	restructuring	the	energy	generation	and	storage	segment,	which
comprised	of	disposals	of	certain	tangible	assets,	the	shortening	of	the	useful	life	of	a	trade	name	intangible	asset	and	a	contract	termination	penalty.	In
addition,	we	concluded	that	a	small	portion	of	the	IPR&D	asset	is	not	commercially	feasible.	Consequently,	we	recognized	an	impairment	loss	of
$
13
	million.	
We	recognized	settlement	and	legal	expenses	of	$
30
	million	in	the	year	ended	December	31,	2018	for	the	settlement	with	the	SEC	relating	to	a
take-private	proposal	for	Tesla.	
These	expenses	were	substantially	paid	by	the	end	of	2018
.
Interest	Expense
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Interest	expense
	
$
685
	
	
$
663
	
	
$
471


key: chroma:document
string_value:
$
663
	
	
$
471
	
	
$
22
	
	
	
3
%
	
$
192
	
	
	
41
%
As	a	percentage	of	revenues
	
	
3
%
	
	
3
%
	
	
4
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Interest	expense	increased	by	$22	million,	or	3%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended	December	31,	2018.	The
increase	was	primarily	due	to	an	increase	in	our	average	outstanding	indebtedness	at	relatively	consistent	weighted	average	interest	rates	as	compared
to	the	year	ended	December	31,	2018.
Other	Income	(Expense),	Net
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
Other	income	(expense),	net
	
$
45
	
	
$
22
	
	
$
(125
)
	
$
23
	
	
105%
	
	
$
147
	
	
Not
meaningful
As	a	percentage	of	revenues
	
	
0
%
	
	
0
%
	
	
-1
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Other	income	(expense),	net,	consists	primarily	of	foreign	exchange	gains	and	losses	related	to	our	foreign	currency-denominated	monetary


key: chroma:document
string_value:
assets	and	liabilities	and	changes	in	the	fair	values	of	our	fixed-for-floating	interest	rate	swaps.	We	expect	our	foreign	exchange	gains	and	losses	will
vary	depending	upon	movements	in	the	underlying	exchange	rates.
54


key: chroma:document
string_value:
Other	income	(expense),	net,	
increased
	
by	
$23
	million
,	or	105%,
	in	the	year	ended	
December	31,	2019
	as	compared	to
	the	year	ended
December	31,	2018
.	The	change	was	primarily	due	to	favorable	fluctuations	in	foreign	currency	exchange	rates
,	offset	by	losses	
from	interest	rate
swaps	related	to	our	debt	facilities	year-over-year.
Provision	for	Income	Taxes
	
	
	
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
	
$
	
	
%
	
Provision	for	income	taxes
	
$
110
	
	
$
58
	
	
$
32
	
	
$
52
	
	
	
90
%
	
$
26
	
	
	
81
%
Effective	tax	rate
	
	
-17
%
	
	
-6
%
	
	
-1
%
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Our	provision	for	income	taxes	increased	by	$52	million,	or	90%,	in	the	year	ended	December	31,	2019	as	compared	to	the	year	ended
December	31,	2018,	primarily	due	to	the	increase	in	taxable	profits	in	certain	foreign	jurisdictions	year-over-year.
Net	Income	(Loss)	Attributable	to	Noncontrolling	Interests	and	Redeemable	Noncontrolling	Interests
	
	
	
Year	Ended	December	31,


key: chroma:document
string_value:
Year	Ended	December	31,
	
	
2019	vs.	2018	Change
	
2018	vs.	2017	Change
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
	
$
	
	
%
	
$
	
	
%
	
Net	income	(loss)	attributable
			to	noncontrolling	interests
			and	redeemable
			noncontrolling	interests
			in	subsidiaries
	
$
87
	
	
$
(87
)
	
$
(279
)
	
$
174
	
	
Not
meaningful
	
$
192
	
	
	
-69
%
	
Our	net	income	(loss)	attributable	to	noncontrolling	interests	and	redeemable	noncontrolling	interests	was	related	to	financing	fund
arrangements.
Net	income	(loss)	attributable	to	noncontrolling	interests	and	redeemable	noncontrolling	interests	
changed	unfavorably	by	$174	million	in	the
year	ended	December	31,	2019	as	compared	to	the	year	ended	December	31,	2018.	The	change	was	primarily
	due	to	lower	activities	in	our	financing
fund	arrangements.
Liquidity	and	Capital	Resources
As	of	December	31,	2019,	we	had	$6.27	billion	of	cash	and	cash	equivalents.	Balances	held	in	foreign	currencies	had	a	U.S.	dollar	equivalent	of
$1.26	billion	and	consisted	primarily	of	Chinese	yuan,	euros	and	Canadian	dollars.	Our	sources	of	cash	are	predominantly	from	our	deliveries	of
vehicles,	sales	and	installations	of	our	energy	storage	products	and	solar	energy	systems,	proceeds	from	debt	facilities,	proceeds	from	financing	funds


key: chroma:document
string_value:
and	proceeds	from	equity	offerings.
Our	sources	of	liquidity	and	cash	flows	enable	us	to	fund	ongoing	operations,	research	and	development	projects	for	new	products,
establishment	and/or	increases	of	Model	3	and	Model	Y	production	capacity	at	the	Fremont	Factory	and	at	Gigafactory	Shanghai,	the	continued
expansion	of	Gigafactory	Nevada,	the	construction	of	Gigafactory	Berlin,	the	manufacturing	ramp	of	the	Solar	Roof	at	Gigafactory	New	York,	and	the
continued	expansion	of	our	retail	and	service	locations,	body	shops,	Mobile	Service	fleet	and	Supercharger	network.
As	discussed	in	and	subject	to	the	considerations	referenced	in	Part	II,	Item	7,	
Management's	Discussion	and	Analysis	of	Financial	Condition
and	Results	of	Operations—Management	Opportunities,	Challenges	and	Risks	and	2020	Outlook—Trends	in	Cash	Flow,	Capital	Expenditures	and
Operating	Expenses
	in	this	Annual	Report	on	Form	10-K,	considering	the	expected	pace	of	the	manufacturing	ramps	for	our	products,	construction	and
expansion	of	our	factories,	and	pipeline	of	projects	under	development,	and	consistent	with	our	current	strategy	of	using	a	partner	to	manufacture
battery	cells,	as	well	as	considering	all	other	infrastructure	growth,	we	currently	expect	our	average	annual	capital	expenditures	in	2020	and	the	two
succeeding	fiscal	years	to	be	$2.5	billion	to	$3.5	billion.
55


key: chroma:document
string_value:
We	expect	that	the	cash	we	generate	from	our	core	operations	will	generally	be	sufficient	to	cover	our	future	capital	expenditures	and	to	pay
down	our	near-term	debt	obligations,	although	we	may	choose	to	seek	alternative	financing	sources.	For	example,	we	expect	that	much	of	our
investment	in	Gigafactory	Shanghai	will	continue	to	be	funded	through	indebtedness	arranged	through	local	financial	institutions	in	China,	such	as	the
RMB	9.0	billion	(or	the	equivalent	amount	in	U.S.	dollars)	fixed	asset	term	facility	and	RMB	2.25	billion	(or	the	equivalent	amount	in	U.S.	dollars)
working	capital	revolving	facility	that	our	local	subsidiary	entered	into	in	December	2019,	and	we	expect	the	same	with	respect	to	Gigafactory	Berlin
.
As	always,	we	continually	evaluate	our	capital	expenditure	needs	and	may	decide	it	is	best	to	raise	additional	capital	to	fund	the	rapid	growth	of	our
business
,	to	further	strengthen	our	balance	sheet,	or	for	general	corporate	purposes
.
We	have	an	agreement	to	spend	or	incur	$5.0	billion	in	combined	capital,	operational	expenses,	costs	of	goods	sold	and	other	costs	in	the	State
of	New	York	during	the	10-year	period	following	full	production	at	Gigafactory	New	York.	We	anticipate	meeting	these	obligations	through	our
operations	at	this	facility	and	other	operations	within	the	State	of	New	York,	and	we	do	not	believe	that	we	face	a	significant	risk	of	default.
We	expect	that	our	current	sources	of	liquidity	together	with	our	projection	of	cash	flows	from	operating	activities	will	provide	us
	with	adequate


key: chroma:document
string_value:
with	adequate
liquidity	over	at	least	the	next	12	months.	A	large	portion	of	our	future	expenditures	is	to	fund	our	growth,	and	we	can	adjust	our	capital	and	operating
expenditures	by	operating	segment,	including	future	expansion	of	our	product	offerings,	retail	and	service	locations,	body	shops,	Mobile	Service	fleet,
and	Supercharger	network.	
We	may	need	or	want	to	raise	additional	funds	in	the	future,	and	these	funds	may	not	be	available	to	us	when	we	need	or
want	them,	or	at	all.	If	we	cannot	raise	additional	funds	when	we	need	or	want	them,	our	operations	and	prospects	could	be	negatively	affected.
In	addition,	we	had	$3.03	billion	of	unused	committed	amounts	under	our	credit	facilities	and	financing	funds	as	of	December	31,	2019,	some	of
which	are	subject	to	satisfying	specified	conditions	prior	to	draw-down	(such	as	pledging	to	our	lenders	sufficient	amounts	of	qualified	receivables,
inventories,	leased	vehicles	and	our	interests	in	those	leases,	solar	energy	systems	and	the	associated	customer	contracts,	our	interests	in	financing
funds	or	various	other	assets;	and	contributing	or	selling	qualified	solar	energy	systems	and	the	associated	customer	contracts	or	qualified	leased
vehicles	and	our	interests	in	those	leases	into	the	financing	funds).	Upon	the	draw-down	of	any	unused	committed	amounts,	there	are	no	restrictions	on
use	of	available	funds	for	general	corporate	purposes.	For	details	regarding	our	indebtedness	and	financing	funds,	refer	to	Note	12,	
Debt
,	and	Note	17,
Variable	Interest	Entity	Arrangements


key: chroma:document
string_value:
Variable	Interest	Entity	Arrangements
,	to	the	consolidated	financial	statements	included	elsewhere	in	this	Annual	Report	on	Form	10-K.
Summary	of	Cash	Flows
	
	
	
Year	Ended	December	31,
	
(Dollars	in	millions)
	
2019
	
	
2018
	
	
2017
	
Net	cash	provided	by	(used	in)	operating	activities
	
$
2,405
	
	
$
2,098
	
	
$
(61
)
Net	cash	used	in	investing	activities
	
$
(1,436
)
	
$
(2,337
)
	
$
(4,196
)
Net	cash	provided	by	financing	activities
	
$
1,529
	
	
$
574
	
	
$
4,415
	
Cash	Flows	from	Operating	Activities
Our	cash	flows	from	operating	activities	are	significantly	affected	by	our	cash	investments	to	support	the	growth	of	our	business	in	areas	such
as	research	and	development	and	selling,	general	and	administrative	and	working	capital,	especially	inventory,	which	includes	vehicles	in	transit.	Our
operating	cash	inflows	include	cash	from	vehicle	sales,	customer	lease	payments,	customer	deposits,	cash	from	sales	of	regulatory	credits	and	energy
generation	and	storage	products.	These	cash	inflows	are	offset	by	our	payments	to	suppliers	for	production	materials	and	parts	used	in	our
manufacturing	process,	operating	expenses,	operating	lease	payments	and	interest	payments	on	our	financings.
56


key: chroma:document
string_value:
Net	cash	
provided	by	
operating	activities	
increased	
by	
$307
	
million
	to	
$
2.41
	
billion	during	the	year	ended	
December	31,	2019
	from	$2.10	billion
during	the	year	ended	December	31,	2018.	This	favorable	change	was	primarily	due	to	the	increase	in	net	income,	excluding	non-cash	expenses	and
gains,	of	$
902	million,
	
partially	offset	by	the	increase	in	net	operating	assets	and	liabilities	of	$407	million	and	$188	million	of	the	repayment	of	our
0.25%	Convertible	Senior	Notes	due	in	2019	which	was	classified	as	an	operating	activity,	as	this	represented	an	interest	payment	on	the	discounted
convertible	notes.	The	increase	in	net	operating	assets	and	liabilities	was	mainly	driven	by	a	smaller	increase	in	accounts	payable	and	accrued	liabilities
in	2019	as	compared	to	2018,	as	we	were	ramping	for	Model	3	production	in	2018	and	a	larger	increase	in	operating	lease	vehicles	in	2019	as
compared	to	2018	as	we	began	offering	Model	3	leasing	in	2019.	The	increase	in	net	operating	assets	and	liabilities	was	partially	offset	by	a	smaller
increase	in	inventory	and	a	larger	increase	in	deferred	revenue	in	2019	as	compared	to	2018.
Cash	Flows	from	Investing	Activities
Cash	flows	from	investing	activities	and	their	variability	across	each	period	related	primarily	to	capital	expenditures,
	which	were	$1.33	billion
during	2019,	mainly	for	Gigafactory	Shanghai	construction,	Model	3	production,	and	Model	Y	preparations,	and	$2.10	billion	during	2018,	mainly	for
Model	3	production.


key: chroma:document
string_value:
Model	3	production.	
Design,	acquisition	and	installation	of	solar	energy	systems	amounted	to	$105	million	and	$218	million	for	the	years	ended
December	31,	2019	and	2018,	respectively.
		
Cash	Flows	from	Financing	Activities
Cash	flows	from	financing	activities	during	the	year	ended	December	31,	2019	consisted	primarily	of	
$1.82	billion	from	the	issuance	of	the
2.00%	Convertible	Senior	Notes	due	in	2024	(“
2024	Notes”),	net	of	transaction	costs,	and	$848	million	from	the	issuance	of	common	stock,	net	of
underwriting	discounts,	in	registered	public	offerings,	$736	million	of	net	borrowings	under	loan	agreements	entered	into	by	certain	Chinese
subsidiaries,	$394	million	of	net	borrowings	for	automotive	asset-backed	notes,	and	$174	million	from	the	issuance	of	warrants	in	connection	with	the
offering	of	the	2024	Notes.	These	cash	inflows	were	partially	offset	by	a	$732	million	portion	of	the	repayment	of	our	0.25%	Convertible	Senior	Notes
due	in	2019	that	was	classified	as	financing	activity,	a	$566	million	repayment	of	our	1.625%	Convertible	Senior	Notes	due	in	2019,	a	purchase	of
convertible	note	hedges	of	$476	million	in	connection	with	the	offering	of	the	2024	Notes,	and	
collateralized	lease	repayments	of	$389	million
.
	See	Note
12,	
Debt
,	and	Note	2,	
Summary	of	Significant	Accounting	Policies
,	to	the	consolidated	financial	statements	included	elsewhere	in	this	Annual	Report	on
Form	10-K	for	further	details	regarding	our	debt	obligations	and	collateralized	borrowings,	respectively.


key: chroma:document
string_value:
Cash	flows	from	financing	activities	during	the	year	ended	December	31,	2018	consisted	primarily	of	$1.18	billion	of	net	borrowings	under
automobile	asset-backed	notes,	$431	million	of	net	borrowings	under	the	senior	secured	asset-based	revolving	credit	agreement	(the	“Credit
Agreement”),	$334	million	from	the	issuance	of	solar	asset-backed	notes	and	$296	million	of	proceeds	from	exercises	of	stock	options	and	other	stock
issuances.	These	cash	inflows	were	partially	offset	by	net	repayments	of	$582	million	under	our	vehicle	lease-backed	loan	and	security	agreements	(the
“Warehouse	Agreements”),	collateralized	lease	repayments	of	$559	million,	repayments	of	$230	million	of	the	2.75%	Convertible	Senior	Notes	due	on
November	1,	2018,	and	repayments	of	$210	million	under	the	revolving	aggregation	credit	facility.
57


key: chroma:document
string_value:
Contractual	Obligations
We	are	party	to	contractual	obligations	involving	commitments	to	make	payments	to	third	parties,	including	certain	debt	financing
arrangements	and	leases,	primarily	for	stores,	service	centers,	certain	manufacturing	and	corporate	offices.	These	also	include,	as	part	of	our	normal
business	practices,	contracts	with	suppliers	for	purchases	of	certain	raw	materials,	components	and	services	to	facilitate	adequate	supply	of	these
materials	and	services	and	capacity	reservation	contracts.	The	following	table	sets	forth,	as	of	December	31,	2019,	certain	significant	obligations	that
will	affect	our	future	liquidity	(in	millions):
	
	
	
	
	
	
	
	
Year	Ended	December	31,
	
	
	
	
	
	
	
Total
	
	
2020
	
	
2021
	
	
2022
	
	
2023
	
	
2024
	
	
Thereafter
	
Operating	lease	obligations,
			including	imputed	interest
	
$
1,459
	
	
$
296
	
	
$
262
	
	
$
210
	
	
$
173
	
	
$
146
	
	
$
372
	
Finance	lease	obligations,
			including	imputed	interest
	
	
1,795
	
	
	
474
	
	
	
478
	
	
	
600
	
	
	
225
	
	
	
5
	
	
	
13
	
Purchase	obligations	(1)
	
	
16,292
	
	
	
5,729
	
	
	
2,946
	
	
	
3,645
	
	
	
3,948
	
	
	
24
	
	
	
—
	
Debt,	including	scheduled


key: chroma:document
string_value:
—
	
Debt,	including	scheduled
			interest	(2)
	
	
14,031
	
	
	
1,774
	
	
	
2,594
	
	
	
2,287
	
	
	
1,993
	
	
	
2,575
	
	
	
2,808
	
Total
	
$
33,577
	
	
$
8,273
	
	
$
6,280
	
	
$
6,742
	
	
$
6,339
	
	
$
2,750
	
	
$
3,193
	
(1)
These	amounts	represent	(i)	purchase	orders	of	$2.50	billion	issued	under	binding	and	enforceable	agreements	with	all	vendors	as	of
December	31,	2019	and	(ii)	$13.79	billion	in	other	estimable	purchase	obligations	pursuant	to	such	agreements,	primarily	relating	to	the
purchase	of	lithium-ion	cells	produced	by	Panasonic	at	Gigafactory	Nevada,	including	any	additional	amounts	we	may	have	to	pay	vendors	if	we
do	not	meet	certain	minimum	purchase	obligations.	In	cases	where	no	purchase	orders	were	outstanding	under	binding	and	enforceable
agreements	as	of	December	31,	2019,	we	have	included	estimated	amounts	based	on	our	best	estimates	and	assumptions	or	discussions	with
the	relevant	vendors	as	of	such	date	or,	where	applicable,	on	amounts	or	assumptions	included	in	such	agreements	for	purposes	of	discussion	or
reference.	In	certain	cases,	such	estimated	amounts	were	subject	to	contingent	events.	Furthermore,	these	amounts	do	not	include	future
payments	for	purchase	obligations	that	were	recorded	in	accounts	payable	or	accrued	liabilities	as	of	December	31,	2019.


key: chroma:document
string_value:
(2)
Debt,	including	scheduled	interest,	includes	our	non-recourse	indebtedness	of	$5.29	billion.	Non-recourse	debt	refers	to	debt	that	is	recourse	to
only	assets	of	our	subsidiaries.	Short-term	scheduled	interest	payments	and	amortization	of	convertible	senior	note	conversion	features,	debt
discounts	and	deferred	financing	costs	for	the	year	ended	December	31,	2020	is	$375	million.	Long-term	scheduled	interest	payments	and
amortization	of	convertible	senior	note	conversion	features,	debt	discounts	and	deferred	financing	costs	for	the	years	thereafter	is	$1.86	billion.
The	table	above	excludes	unrecognized	tax	benefits	of	$247	million	because	if	recognized,	they	would	be	an	adjustment	to	our	deferred	tax
assets.
We	offer	resale	value	guarantees	or	similar	buyback	terms	to	certain	customers	who	purchase	and	finance	their	vehicles	through	one	of	our
specified	commercial	banking	partners	and	certain	leasing	partners	(refer	to	
Automotive	Sales	with	Resale	Value	Guarantee	or	a	Buyback	Option
	in
Note	2,	
Significant	Accounting	Policies
,	to	the	consolidated	financial	statements	included	elsewhere	in	this	Annual	Report	on	Form	10-K).	The	maximum
amount	we	could	be	required	to	pay	under	these	programs,	should	customers	exercise	their	resale	value	guarantees	or	buyback	options,	would	be	$1.70
billion	over	the	next	five	years,	of	which	$226	million	is	within	a	12-month	period	from	December	31,	2019.	We	have	not	included	this	in	the	table	above
as	it	is	unknown	how	many	customers	will	exercise	their	options.	Additionally,	we	plan	to	resell	any	vehicles	which	are	returned	to	us	and	therefore,	the


key: chroma:document
string_value:
Off-Balance	Sheet	Arrangements
During	the	periods	presented,	we	did	not	have	relationships	with	unconsolidated	entities	or	financial	partnerships,	such	as	entities	often
referred	to	as	structured	finance	or	special	purpose	entities,	which	were	established	for	the	purpose	of	facilitating	off-balance	sheet	arrangements	or
other	contractually	narrow	or	limited	purposes.
Recent	Accounting	Pronouncements
See	Note	2,	
Summary	of	Significant	Accounting	Policies
,	to	the	consolidated	financial	statements	included	elsewhere	in	this	Annual	Report	on
Form	10-K.
	
	
59


key: chroma:document
string_value:
ITEM	7A.
QUANTITATIVE	AND	QUALITATIVE	DISCLOSURES	ABOUT	MARKET	RISK
Foreign	Currency	Risk
We	transact	business	globally	in	multiple	currencies	and	hence	have	foreign	currency	risks	related	to	our	revenue,	costs	of	revenue	and
operating	expenses	denominated	in	currencies	other	than	the	U.S.	dollar	(primarily	the	euro,	Japanese	yen,	Canadian	dollar,	Chinese	yuan	and
Norwegian	krone).	In	general,	we	are	a	net	receiver	of	currencies	other	than	the	U.S.	dollar	for	our	foreign	subsidiaries.	Accordingly,	changes	in
exchange	rates	and,	in	particular,	a	strengthening	of	the	U.S.	dollar	have	in	the	past,	and	may	in	the	future,	negatively	affect	our	revenue	and	other
operating	results	as	expressed	in	U.S.	dollars	as	we	do	not	typically	hedge	foreign	currency.
We	have	also	experienced,	and	will	continue	to	experience,	fluctuations	in	our	net	income	(loss)	as	a	result	of	gains	(losses)	on	the	settlement
and	the	re-measurement	of	monetary	assets	and	liabilities	denominated	in	currencies	that	are	not	the	local	currency	(primarily	consisting	of	our
intercompany	and	cash	and	cash	equivalents	balances).	For	the	year	ended	December	31,	2019,	we	recognized	a	net	foreign	currency	gain	of	$48
million	in	other	(expense)	income,	net,	with	our	largest	re-measurement	exposures	from	the	U.S.	dollar,	British	pound	and	Canadian	dollar	as	our
subsidiaries	are	denominated	in	various	local	currencies.	
For	the	year	ended	December	31,	2018,	we	recognized	a	net	foreign	currency	gain	of
$2	million	in	other	(expense)	
income


key: chroma:document
string_value:
$2	million	in	other	(expense)	
income
,	net,	with	our	largest	re-measurement	exposures	from	the	euro,	New	Taiwan	dollar	and	Canadian	dollar.
We	considered	the	historical	trends	in	foreign	currency	exchange	rates	and	determined	that	it	is	reasonably	possible	that	adverse	changes	in
foreign	currency	exchange	rates	of	10%	for	all	currencies	could	be	experienced	in	the	near-term.	These	changes	were	applied	to	our	total	monetary
assets	and	liabilities	denominated	in	currencies	other	than	our	local	currencies	at	the	balance	sheet	date	to	compute	the	impact	these	changes	would
have	had	on	our	net	income	(loss)	before	income	taxes.	These	changes	would	have	resulted	in	an	adverse	impact	of	$362	million	at	December	31,	2019
and	$176	million	at	December	31,	2018	assuming	no	foreign	currency	hedging.
Interest	Rate	Risk
We	are	exposed	to	interest	rate	risk	on	our	borrowings	that	bear	interest	at	floating	rates.	Pursuant	to	our	risk	management	policies,	in	certain
cases,	we	utilize	derivative	instruments	to	manage	some	of	this	risk.	We	do	not	enter	into	derivative	instruments	for	trading	or	speculative	purposes.	A
hypothetical	10%	change	in	our	interest	rates	would	have	increased	or	decreased	our	interest	expense	for	the	years	ended	December	31,	2019	and
2018	by	$8	million	and	$9	million,	respectively.
	
	
	
60


key: chroma:document
string_value:
I
TEM	8.
FINANCIAL	STATEMENTS	AND	SUPPLEMENTARY	DATA
	
Index	to	Consolidated	Financial	Statements
	
	
		
Page
Report	of	Independent	Registered	Public	Accounting	Firm
		
62
Consolidated	Balance	Sheets
		
65
Consolidated	Statements	of	Operations
		
66
Consolidated	Statements	of	Comprehensive	Loss
		
67
Consolidated	Statements	of	Redeemable	Noncontrolling	Interests	and	Equity
		
68
Consolidated	Statements	of	Cash	Flows
		
69
Notes	to	Consolidated	Financial	Statements
		
70
	
	
	
61


key: chroma:document
string_value:
Report	of	Independent	Registered	Public	Accounting	Firm
	
To	the	Board	of	Directors	and	Stockholders	of	Tesla,	Inc.
Opinions	on	the	Financial	Statements	and	Internal	Control	over	Financial	Reporting
We	have	audited	the	accompanying	consolidated	balance	sheets	of	Tesla,	Inc.	and	its	subsidiaries	(the	“Company”)	as	of	December	31,	2019	and	2018,
and	the	related	consolidated	statements	of	operations,	of	comprehensive	loss,	of	redeemable	noncontrolling	interests	and	equity	and	of	cash	flows	for
each	of	the	three	years	in	the	period	ended	December	31,	2019,	including	the	related	notes	(collectively	referred	to	as	the	“consolidated	financial
statements”).	We	also	have	audited	the	Company's	internal	control	over	financial	reporting	as	of	December	31,	2019,	based	on	criteria	established	in
Internal	Control	-	Integrated	Framework
	(2013)	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(COSO).
In	our	opinion,	the	consolidated	financial	statements	referred	to	above	present	fairly,	in	all	material	respects,	the	financial	position	of	the	Company	as	of
December	31,	2019	and	2018,	and	the	results	of	its	operations	and	its	cash	flows	for	each	of	the	three	years	in	the	period	ended	December	31,	2019	in
conformity	with	accounting	principles	generally	accepted	in	the	United	States	of	America.	Also	in	our	opinion,	the	Company	maintained,	in	all	material
respects,	effective	internal	control	over	financial	reporting	as	of	December	31,	2019,	based	on	criteria	established	in	
Internal	Control	-	Integrated
Framework
	(2013)	issued	by	the	COSO.
Changes	in	Accounting	Principles


key: chroma:document
string_value:
Changes	in	Accounting	Principles
As	discussed	in	Note	2	to	the	consolidated	financial	statements,	the	Company	changed	the	manner	in	which	it	accounts	for	leases	in	2019	and	the
manner	in	which	it	accounts	for	revenue	from	contracts	with	customers	in	2018.
Basis	for	Opinions
The	Company's	management	is	responsible	for	these	consolidated	financial	statements,	for	maintaining	effective	internal	control	over	financial
reporting,	and	for	its	assessment	of	the	effectiveness	of	internal	control	over	financial	reporting,	included	in	Management’s	Report	on	Internal	Control
over	Financial	Reporting	appearing	under	Item	9A.	Our	responsibility	is	to	express	opinions	on	the	Company’s	consolidated	financial	statements	and	on
the	Company's	internal	control	over	financial	reporting	based	on	our	audits.	We	are	a	public	accounting	firm	registered	with	the	Public	Company
Accounting	Oversight	Board	(United	States)	(PCAOB)	and	are	required	to	be	independent	with	respect	to	the	Company	in	accordance	with	the	U.S.
federal	securities	laws	and	the	applicable	rules	and	regulations	of	the	Securities	and	Exchange	Commission	and	the	PCAOB.
We	conducted	our	audits	in	accordance	with	the	standards	of	the	PCAOB.	Those	standards	require	that	we	plan	and	perform	the	audits	to	obtain
reasonable	assurance	about	whether	the	consolidated	financial	statements	are	free	of	material	misstatement,	whether	due	to	error	or	fraud,	and
whether	effective	internal	control	over	financial	reporting	was	maintained	in	all	material	respects.
Our	audits	of	the	consolidated	financial	statements	included	performing	procedures	to	assess	the	risks	of	material	misstatement	of	the	consolidated


key: chroma:document
string_value:
financial	statements,	whether	due	to	error	or	fraud,	and	performing	procedures	that	respond	to	those	risks.	Such	procedures	included	examining,	on	a
test	basis,	evidence	regarding	the	amounts	and	disclosures	in	the	consolidated	financial	statements.	Our	audits	also	included	evaluating	the	accounting
principles	used	and	significant	estimates	made	by	management,	as	well	as	evaluating	the	overall	presentation	of	the	consolidated	financial	statements.
Our	audit	of	internal	control	over	financial	reporting	included	obtaining	an	understanding	of	internal	control	over	financial	reporting,	assessing	the	risk
that	a	material	weakness	exists,	and	testing	and	evaluating	the	design	and	operating	effectiveness	of	internal	control	based	on	the	assessed	risk.	Our
audits	also	included	performing	such	other	procedures	as	we	considered	necessary	in	the	circumstances.	We	believe	that	our	audits	provide	a
reasonable	basis	for	our	opinions.
62


key: chroma:document
string_value:
Definition	and	Limitations	of	Internal	Control	over	Financial	Reporting
A	company’s	internal	control	over	financial	reporting	is	a	process	designed	to	provide	reasonable	assurance	regarding	the	reliability	of	financial
reporting	and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally	accepted	accounting	principles.	A	company’s
internal	control	over	financial	reporting	includes	those	policies	and	procedures	that	(i)	pertain	to	the	maintenance	of	records	that,	in	reasonable	detail,
accurately	and	fairly	reflect	the	transactions	and	dispositions	of	the	assets	of	the	company;	(ii)	provide	reasonable	assurance	that	transactions	are
recorded	as	necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally	accepted	accounting	principles,	and	that	receipts	and
expenditures	of	the	company	are	being	made	only	in	accordance	with	authorizations	of	management	and	directors	of	the	company;	and	(iii)	provide
reasonable	assurance	regarding	prevention	or	timely	detection	of	unauthorized	acquisition,	use,	or	disposition	of	the	company’s	assets	that	could	have	a
material	effect	on	the	financial	statements.
Because	of	its	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements.	Also,	projections	of	any	evaluation
of	effectiveness	to	future	periods	are	subject	to	the	risk	that	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the	degree	of
compliance	with	the	policies	or	procedures	may	deteriorate.
Critical	Audit	Matters
The	critical	audit	matters	communicated	below	are	matters	arising	from	the	current	period	audit	of	the	consolidated	financial	statements	that	were
communicated	or	required	to	be	communicated	to	the	audit	committee	and	that	(i)	relate	to	accounts	or	disclosures	that	are	material	to	the


key: chroma:document
string_value:
consolidated	financial	statements	and	(ii)	involved	our	especially	challenging,	subjective,	or	complex	judgments.	The	communication	of	critical	audit
matters	does	not	alter	in	any	way	our	opinion	on	the	consolidated	financial	statements,	taken	as	a	whole,	and	we	are	not,	by	communicating	the	critical
audit	matters	below,	providing	separate	opinions	on	the	critical	audit	matters	or	on	the	accounts	or	disclosures	to	which	they	relate.
Automotive	Sales	To	Customers	With	a	Resale	Value	Guarantee	or	Buyback	Option
As	described	in	Note	2	to	the	consolidated	financial	statements,	the	sales	return	reserve	related	to	resale	value	guarantees	or	buyback	options	was
$639	million	as	of	December	31,	2019,	of	which	$93	million	was	short-term.	The	Company	offers	some	customers	resale	value	guarantees	or	buyback
options.	Under	these	programs,	the	Company	receives	full	payment	for	the	vehicle	sales	price	at	the	time	of	delivery	and	the	customer	has	the	option	of
selling	their	vehicle	back	to	the	Company	during	the	guarantee	period	for	a	pre-determined	resale	value.	In	circumstances	where	management	does	not
believe	the	customer	has	a	significant	economic	incentive	to	exercise	the	resale	value	guarantee	or	buyback	option	provided	to	them,	the	Company
recognizes	revenue	when	control	transfers	upon	delivery	to	a	customer	as	a	sale	with	a	right	of	return.	In	circumstances	where	management	believes
the	customer	has	a	significant	economic	incentive	to	exercise	the	resale	value	guarantee	or	buyback	option,	the	Company	recognizes	the	transaction	as
an	operating	lease.	Management’s	determination	of	whether	there	is	a	significant	economic	incentive	includes	comparing	and	considering	a	vehicle’s


key: chroma:document
string_value:
estimated	market	value	at	the	time	the	option	is	exercisable	with	the	guaranteed	resale	value.	Sales	return	reserves	are	estimated	based	on	historical
experience	plus	estimates	of	expected	future	market	values.	On	a	quarterly	basis,	management	reassesses	the	estimated	future	market	values	of
vehicles	under	these	programs,	taking	into	account	price	adjustments	on	new	vehicles	and	other	changes	in	market	value	subsequent	to	the	initial	sale
to	determine	the	need	for	changes	to	the	reserve.		
The	principal	considerations	for	our	determination	that	performing	procedures	relating	to	automotive	sales	to	customers	with	a	resale	value	guarantee
or	buyback	option	is	a	critical	audit	matter	are	there	was	significant	judgment	by	management	in	determining	the	sales	return	reserve	when	customers
do	not	have	a	significant	economic	incentive	to	exercise	their	option.	This	in	turn	led	to	high	degree	of	auditor	judgment,	subjectivity,	and	effort	in
performing	procedures	and	evaluating	evidence	in	the	sales	return	reserve	when	customers	do	not	have	a	significant	economic	incentive.		
63


key: chroma:document
string_value:
Addressing	the	matter	involved	performing	procedures	and	evaluating	audit	evidence	in	connection	with	forming	our	overall	opinion	on	the	consolidated
financial	statements.	These	procedures	included	testing	the	effectiveness	of	controls	relating	to	automotive	revenue	recognition	for	sales	to	customers
with	a	resale	value	guarantee	or	buyback	option	as	well	as	the	related	sales	return	reserve,	including	controls	over	management’s	estimate	of	expected
future	market	values	and	historical	experience.	These	procedures	also	included,	among	others,	testing	management’s	process	for	determining	whether
customers	have	a	significant	economic	incentive	to	exercise	their	put	rights	under	the	resale	value	guarantee	and	buyback	option	programs	and,	if	not,
the	related	sales	return	reserve.	This	included	evaluating	the	appropriateness	of	the	model	applied	and	the	reasonableness	of	significant	assumptions,
including	historical	experience	and	the	estimated	expected	future	market	values	used	in	the	comparison	to	guaranteed	resale	amounts.	Evaluating
assumptions	related	to	historical	experience	and	estimated	expected	future	market	values	involved	evaluating	whether	the	assumptions	used	were
reasonable	considering	current	and	past	performance	and	consistency	with	evidence	obtained	in	other	areas	of	the	audit.	Procedures	were	performed	to
evaluate	the	reliability,	completeness	and	relevance	of	management’s	data	used	in	the	development	of	the	historical	experience	assumption.
Automotive	Warranty	Reserve
As	described	in	Note	2	to	the	consolidated	financial	statements,	total	accrued	warranty,	which	primarily	relates	to	the	automotive	segment,	was	$1,089
million	as	of	December	31,	2019.	The	Company	provides	a	manufacturer’s	warranty	on	all	new	and	used	Tesla	vehicles.	As	described	in	Note	2,	a


key: chroma:document
string_value:
warranty	reserve	is	accrued	for	these	products	sold,	which	includes	management’s	best	estimate	of	the	projected	costs	to	repair	or	replace	items	under
warranty,	including	recalls	when	identified.	These	estimates	are	based	on	actual	claims	incurred	to	date	and	an	estimate	of	the	nature,	frequency	and
costs	of	future	claims.		
The	principal	considerations	for	our	determination	that	performing	procedures	relating	to	the	automotive	warranty	reserve	is	a	critical	audit	matter	are
there	was	significant	judgment	by	management	in	determining	the	warranty	reserve.	This	in	turn	led	to	significant	auditor	judgment,	subjectivity,	and
effort	in	performing	procedures	to	evaluate	the	estimate	of	the	nature,	frequency	and	costs	of	future	claims,	and	the	audit	effort	involved	the	use	of
professionals	with	specialized	skill	and	knowledge.		
Addressing	the	matter	involved	performing	procedures	and	evaluating	audit	evidence	in	connection	with	forming	our	overall	opinion	on	the	consolidated
financial	statements.	These	procedures	included	testing	the	effectiveness	of	controls	relating	to	management’s	estimate	of	the	automotive	warranty
reserve,	including	controls	over	management’s	estimate	of	the	nature,	frequency	and	costs	of	future	claims	as	well	as	the	completeness	and	accuracy	of
actual	claims	incurred	to	date.	These	procedures	also	included,	among	others,	testing	management’s	process	for	determining	the	automotive	warranty
reserve.	This	included	evaluating	the	appropriateness	of	the	model	applied	and	the	reasonableness	of	significant	assumptions,	including	the	nature	and
frequency	of	future	claims	and	the	related	costs	to	repair	or	replace	items	under	warranty.	Evaluating	the	assumptions	related	to	the	nature	and


key: chroma:document
string_value:
frequency	of	future	claims	and	the	related	costs	to	repair	or	replace	items	under	warranty	involved	evaluating	whether	the	assumptions	used	were
reasonable	considering	current	and	past	performance,	including	a	lookback	analysis	comparing	prior	period	forecasted	claims	to	actual	claims	incurred.
These	procedures	also	included	developing	an	independent	estimate	of	a	portion	of	the	warranty	accrual,	comparing	the	independent	estimate	to
management’s	estimate	to	evaluate	the	reasonableness	of	the	estimate,	and	testing	the	completeness	and	accuracy	of	historical	vehicle	claims.
Procedures	were	performed	to	test	the	reliability,	completeness,	and	relevance	of	management’s	data	related	to	the	historical	claims	processed	and	that
such	claims	were	appropriately	used	by	management	in	the	estimation	of	future	claims.	Professionals	with	specialized	skill	and	knowledge	were	used	to
assist	in	evaluating	the	appropriateness	of	aspects	of	management’s	model	for	estimating	the	nature	and	frequency	of	future	claims,	and	testing
management’s	warranty	reserve	for	a	portion	of	future	warranty	claims.
	
	
/s/PricewaterhouseCoopers	LLP
San	Jose,	California
February	13,	2020
We	have	served	as	the	Company’s	auditor	since	2005.
	
	
	
	
64


key: chroma:document
string_value:
Tesla,	Inc.
Consolidated	Balance	Sheets
(in	millions,	except	per	share	data)
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Assets
	
	
	
	
	
	
	
	
Current	assets
	
	
	
	
	
	
	
	
Cash	and	cash	equivalents
	
$
6,268
	
	
$
3,686
	
Restricted	cash
	
	
246
	
	
	
193
	
Accounts	receivable,	net
	
	
1,324
	
	
	
949
	
Inventory
	
	
3,552
	
	
	
3,113
	
Prepaid	expenses	and	other	current	assets
	
	
713
	
	
	
366
	
Total	current	assets
	
	
12,103
	
	
	
8,307
	
Operating	lease	vehicles,	net
	
	
2,447
	
	
	
2,090
	
Solar	energy	systems,	net
	
	
6,138
	
	
	
6,271
	
Property,	plant	and	equipment,	net
	
	
10,396
	
	
	
11,330
	
Operating	lease	right-of-use	assets
	
	
1,218
	
	
	
—
	
Intangible	assets,	net
	
	
339
	
	
	
282
	
Goodwill
	
	
198
	
	
	
68
	
MyPower	customer	notes	receivable,	net	of	current	portion
	
	
393
	
	
	
422
	
Restricted	cash,	net	of	current	portion
	
	
269
	
	
	
398
	
Other	assets
	
	
808
	
	
	
572
	
Total	assets
	
$
34,309
	
	
$
29,740
	
Liabilities


key: chroma:document
string_value:
$
29,740
	
Liabilities
	
	
	
	
	
	
	
	
Current	liabilities
	
	
	
	
	
	
	
	
Accounts	payable
	
$
3,771
	
	
$
3,405
	
Accrued	liabilities	and	other
	
	
2,905
	
	
	
2,094
	
Deferred	revenue
	
	
1,163
	
	
	
630
	
Resale	value	guarantees
	
	
317
	
	
	
503
	
Customer	deposits
	
	
726
	
	
	
793
	
Current	portion	of	debt	and	finance	leases
	
	
1,785
	
	
	
2,568
	
Total	current	liabilities
	
	
10,667
	
	
	
9,993
	
Debt	and	finance	leases,	net	of	current	portion
	
	
11,634
	
	
	
9,404
	
Deferred	revenue,	net	of	current	portion
	
	
1,207
	
	
	
991
	
Resale	value	guarantees,	net	of	current	portion
	
	
36
	
	
	
329
	
Other	long-term	liabilities
	
	
2,655
	
	
	
2,710
	
Total	liabilities
	
	
26,199
	
	
	
23,427
	
Commitments	and	contingencies	(Note	16)
	
	
	
	
	
	
	
	
Redeemable	noncontrolling	interests	in	subsidiaries
	
	
643
	
	
	
556
	
Equity
	
	
	
	
	
	
	
	
Stockholders'	equity
	
	
	
	
	
	
	
	
Preferred	stock;	$
0.001
	par	value;	
100
	shares	authorized;
			
no


key: chroma:document
string_value:
100
	shares	authorized;
			
no
	shares	issued	and	outstanding
	
	
—
	
	
	
—
	
Common	stock;	$
0.001
	par	value;	
2,000
	shares	authorized;
	181
	and
			
173
	shares	issued	and	outstanding	as	of	December	31,	2019	and	2018,
			respectively
	
	
0
	
	
	
0
	
Additional	paid-in	capital
	
	
12,737
	
	
	
10,249
	
Accumulated	other	comprehensive	loss
	
	
(
36
)
	
	
(
8
)
Accumulated	deficit
	
	
(
6,083
)
	
	
(
5,318
)
Total	stockholders'	equity
	
	
6,618
	
	
	
4,923
	
Noncontrolling	interests	in	subsidiaries
	
	
849
	
	
	
834
	
Total	liabilities	and	equity
	
$
34,309
	
	
$
29,740
	
The	accompanying	notes	are	an	integral	part	of	these	consolidated	financial	statements.
	
	
65


key: chroma:document
string_value:
Tesla,	Inc.
	
Consolidated	Statements	of	Operations
(in	millions,	except	per	share	data)
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Revenues
	
	
	
	
	
	
	
	
	
	
	
	
Automotive	sales
	
$
19,952
	
	
$
17,632
	
	
$
8,535
	
Automotive	leasing
	
	
869
	
	
	
883
	
	
	
1,107
	
Total	automotive	revenues
	
	
20,821
	
	
	
18,515
	
	
	
9,642
	
Energy	generation	and	storage
	
	
1,531
	
	
	
1,555
	
	
	
1,116
	
Services	and	other
	
	
2,226
	
	
	
1,391
	
	
	
1,001
	
Total	revenues
	
	
24,578
	
	
	
21,461
	
	
	
11,759
	
Cost	of	revenues
	
	
	
	
	
	
	
	
	
	
	
	
Automotive	sales
	
	
15,939
	
	
	
13,686
	
	
	
6,725
	
Automotive	leasing
	
	
459
	
	
	
488
	
	
	
708
	
Total	automotive	cost	of	revenues
	
	
16,398
	
	
	
14,174
	
	
	
7,433
	
Energy	generation	and	storage
	
	
1,341
	
	
	
1,365
	
	
	
874
	
Services	and	other
	
	
2,770
	
	
	
1,880
	
	
	
1,229


key: chroma:document
string_value:
1,880
	
	
	
1,229
	
Total	cost	of	revenues
	
	
20,509
	
	
	
17,419
	
	
	
9,536
	
Gross	profit
	
	
4,069
	
	
	
4,042
	
	
	
2,223
	
Operating	expenses
	
	
	
	
	
	
	
	
	
	
	
	
Research	and	development
	
	
1,343
	
	
	
1,460
	
	
	
1,378
	
Selling,	general	and	administrative
	
	
2,646
	
	
	
2,835
	
	
	
2,477
	
Restructuring	and	other
	
	
149
	
	
	
135
	
	
	
—
	
Total	operating	expenses
	
	
4,138
	
	
	
4,430
	
	
	
3,855
	
Loss	from	operations
	
	
(
69
)
	
	
(
388
)
	
	
(
1,632
)
Interest	income
	
	
44
	
	
	
24
	
	
	
19
	
Interest	expense
	
	
(
685
)
	
	
(
663
)
	
	
(
471
)
Other	income	(expense),	net
	
	
45
	
	
	
22
	
	
	
(
125
)
Loss	before	income	taxes
	
	
(
665
)
	
	
(
1,005
)
	
	
(
2,209
)
Provision	for	income	taxes
	
	
110
	
	
	
58
	
	
	
32
	
Net	loss
	
	
(
775
)
	
	
(
1,063
)
	
	
(
2,241
)


key: chroma:document
string_value:
)
	
	
(
2,241
)
Net	income	(loss)	attributable	to	noncontrolling	interests	and
			redeemable	noncontrolling	interests	in	subsidiaries
	
	
87
	
	
	
(
87
)
	
	
(
279
)
Net	loss	attributable	to	common	stockholders
	
$
(
862
)
	
$
(
976
)
	
$
(
1,962
)
Net	loss	per	share	of	common	stock	attributable	to
			common	stockholders
	
	
	
	
	
	
	
	
	
	
	
	
Basic
	
	
(
4.92
)
	
$
(
5.72
)
	
$
(
11.83
)
Diluted
	
	
(
4.92
)
	
$
(
5.72
)
	
$
(
11.83
)
Weighted	average	shares	used	in	computing	net	loss	per
			share	of	common	stock
	
	
	
	
	
	
	
	
	
	
	
	
Basic
	
	
177
	
	
	
171
	
	
	
166
	
Diluted
	
	
177
	
	
	
171
	
	
	
166
	
The	accompanying	notes	are	an	integral	part	of	these	consolidated	financial	statements.
	
	
	
66


key: chroma:document
string_value:
Tesla,	Inc.
Consolidated	Statements	of	Comprehensive	Loss
(in	millions)
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Net	loss
	
$
(
775
)
	
$
(
1,063
)
	
$
(
2,241
)
Other	comprehensive	loss:
	
	
	
	
	
	
	
	
	
	
	
	
Reclassification	adjustment	for	net	gains
			on	derivatives	into	net	loss
	
	
—
	
	
	
—
	
	
	
(
6
)
Foreign	currency	translation	adjustment
	
	
(
28
)
	
	
(
42
)
	
	
63
	
Comprehensive	loss
	
	
(
803
)
	
	
(
1,105
)
	
	
(
2,184
)
Less:	Comprehensive	income	(loss)	attributable	to	noncontrolling
			interests	and	redeemable	noncontrolling	interests	in	subsidiaries
	
	
87
	
	
	
(
87
)
	
	
(
279
)
Comprehensive	loss	attributable	to	common	stockholders
	
$
(
890
)
	
$
(
1,018
)
	
$
(
1,905
)
	
The	accompanying	notes	are	an	integral	part	of	these	consolidated	financial	statements.
	
	
	
67


key: chroma:document
string_value:
Tesla,	Inc.
Consolidated	Statements	of	Redeemable	Noncontrolling	Interests	and	Equity
(in	millions,	except	per	share	data)
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Accumulated
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Redeemable
	
	
	
	
	
	
	
	
	
	
	
Additional
	
	
	
	
	
	
Other
	
	
Total
	
	
Noncontrolling
	
	
	
	
	
	
	
Noncontrolling
	
	
	
Common	Stock
	
	
Paid-In
	
	
Accumulated
	
	
Comprehensive
	
	
Stockholders'
	
	
Interests	in
	
	
Total
	
	
	
Interests
	
	
	
Shares
	
	
Amount
	
	
Capital
	
	
Deficit
	
	
Loss
	
	
Equity
	
	
Subsidiaries
	
	
Equity
	
Balance	as	of	December	31,	2016
	
$
367
	
	
	
	
162
	
	
$
0
	
	
$
7,774
	
	
$
(
2,997
)
	
$
(
24
)
	
$
4,753
	
	
$
785
	
	
$
5,538
	
Adjustment	of	prior	periods	due	to	adoption	of	Accounting	Standards
Update	No.	2016-09
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
15
	
	
	
(
15
)
	
	
—
	
	
	
—


key: chroma:document
string_value:
—
	
	
	
—
	
	
	
—
	
	
	
—
	
Conversion	feature	of	Convertible	Senior	Notes	due	in	2022
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
146
	
	
	
—
	
	
	
—
	
	
	
146
	
	
	
—
	
	
	
146
	
Purchases	of	convertible	note	hedges
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
(
204
)
	
	
—
	
	
	
—
	
	
	
(
204
)
	
	
—
	
	
	
(
204
)
Sales	of	warrants
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
53
	
	
	
—
	
	
	
—
	
	
	
53
	
	
	
—
	
	
	
53
	
Exercises	of	conversion	feature	of	convertible	senior	notes
	
	
—
	
	
	
	
1
	
	
	
0
	
	
	
230
	
	
	
—
	
	
	
—
	
	
	
230
	
	
	
—
	
	
	
230
	
Issuance	of	common	stock	for	equity	incentive	awards	and	acquisitions,
net	of	transaction	costs
	
	
—
	
	
	
	
4
	
	
	
0
	
	
	
269
	
	
	
—
	
	
	
—
	
	
	
269
	
	
	
—
	
	
	
269
	
Issuance	of	common	stock	in	March	2017	public	offering	at	$
262.00


key: chroma:document
string_value:
262.00
	per
share,	net	of
			issuance	costs	of	$
3
	
	
—
	
	
	
	
2
	
	
	
0
	
	
	
400
	
	
	
—
	
	
	
—
	
	
	
400
	
	
	
—
	
	
	
400
	
Stock-based	compensation
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
485
	
	
	
—
	
	
	
—
	
	
	
485
	
	
	
—
	
	
	
485
	
Contributions	from	noncontrolling	interests
	
	
193
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
597
	
	
	
597
	
Distributions	to	noncontrolling	interests
	
	
(
101
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
	
	
	
	
—
	
	
	
—
	
	
	
(
164
)
	
	
(
164
)
Other
	
	
(
3
)
	
	
	
—
	
	
	
—
	
	
	
10
	
	
	
—
	
	
	
—
	
	
	
10
	
	
	
—
	
	
	
10
	
Net	loss
	
	
(
58
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
1,962
)
	
	
—
	
	
	
(
1,962
)
	
	
(
221


key: chroma:document
string_value:
(
1,962
)
	
	
(
221
)
	
	
(
2,183
)
Other	comprehensive	income
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
57
	
	
	
57
	
	
	
—
	
	
	
57
	
Balance	as	of	December	31,	2017
	
$
398
	
	
	
	
169
	
	
$
0
	
	
$
9,178
	
	
$
(
4,974
)
	
$
33
	
	
$
4,237
	
	
$
997
	
	
$
5,234
	
Adjustments	for	prior	periods	from	adopting	ASC	606
	
	
8
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
623
	
	
	
—
	
	
	
623
	
	
	
(
89
)
	
	
534
	
Adjustments	for	prior	periods	from	adopting	Accounting	Standards
Update	No.	2017-05
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
9
	
	
	
—
	
	
	
9
	
	
	
—
	
	
	
9
	
Issuance	of	common	stock	for	equity	incentive	awards
	
	
—
	
	
	
	
4
	
	
	
0
	
	
	
296
	
	
	
—
	
	
	
—
	
	
	
296
	
	
	
—
	
	
	
296
	
Stock-based	compensation
	
	
—


key: chroma:document
string_value:
—
	
	
	
	
—
	
	
	
—
	
	
	
775
	
	
	
—
	
	
	
—
	
	
	
775
	
	
	
—
	
	
	
775
	
Contributions	from	noncontrolling	interests
	
	
276
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
161
	
	
	
161
	
Distributions	to	noncontrolling	interests
	
	
(
61
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
210
)
	
	
(
210
)
Other
	
	
(
3
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
Net	loss
	
	
(
62
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
976
)
	
	
—
	
	
	
(
976
)
	
	
(
25
)
	
	
(
1,001
)
Other	comprehensive	loss
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
41
)
	
	
(
41
)
	
	
—
	
	
	
(
41
)


key: chroma:document
string_value:
—
	
	
	
(
41
)
Balance	as	of	December	31,	2018
	
$
556
	
	
	
	
173
	
	
$
0
	
	
$
10,249
	
	
$
(
5,318
)
	
$
(
8
)
	
$
4,923
	
	
$
834
	
	
$
5,757
	
Adjustments	for	prior	periods	from	adopting	ASC	842
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
97
	
	
	
—
	
	
	
97
	
	
	
—
	
	
	
97
	
Conversion	feature	of	Convertible	Senior	Notes	due	in	2024
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
491
	
	
	
—
	
	
	
—
	
	
	
491
	
	
	
—
	
	
	
491
	
Purchase	of	convertible	note	hedges
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
(
476
)
	
	
—
	
	
	
—
	
	
	
(
476
)
	
	
—
	
	
	
(
476
)
Sales	of	warrants
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
174
	
	
	
—
	
	
	
—
	
	
	
174
	
	
	
—
	
	
	
174
	
Issuance	of	common	stock	for	equity	incentive	awards	and	acquisitions,
net	of	transaction	costs
	
	
—
	
	
	
	
5


key: chroma:document
string_value:
—
	
	
	
	
5
	
	
	
0
	
	
	
482
	
	
	
—
	
	
	
—
	
	
	
482
	
	
	
—
	
	
	
482
	
Issuance	of	common	stock	in	May	2019	public	offering	at	$
243.00
	per
share,	net	of
			issuance	costs	of	$
15
	
	
—
	
	
	
	
3
	
	
	
0
	
	
	
848
	
	
	
—
	
	
	
—
	
	
	
848
	
	
	
—
	
	
	
848
	
Stock-based	compensation
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
973
	
	
	
—
	
	
	
—
	
	
	
973
	
	
	
—
	
	
	
973
	
Contributions	from	noncontrolling	interests
	
	
105
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
174
	
	
	
174
	
Distributions	to	noncontrolling	interests
	
	
(
65
)
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
198
)
	
	
(
198
)
Other
	
	
(
1
)
	
	
	
—
	
	
	
—
	
	
	
(
4
)
	
	
—
	
	
	
—
	
	
	
(


key: chroma:document
string_value:
—
	
	
	
(
4
)
	
	
—
	
	
	
(
4
)
Net	income	(loss)
	
	
48
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
862
)
	
	
—
	
	
	
(
862
)
	
	
39
	
	
	
(
823
)
Other	comprehensive	loss
	
	
—
	
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
(
28
)
	
	
(
28
)
	
	
—
	
	
	
(
28
)
Balance	as	of	December	31,	2019
	
$
643
	
	
	
	
181
	
	
$
0
	
	
$
12,737
	
	
$
(
6,083
)
	
$
(
36
)
	
$
6,618
	
	
$
849
	
	
$
7,467
	
The	accompanying	notes	are	an	integral	part	of	these	consolidated	financial	statements.
	
68


key: chroma:document
string_value:
Tesla,	Inc.
Consolidated	Statements	of	Cash	Flows
(in	millions)
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Cash	Flows	from	Operating	Activities
	
	
	
	
	
	
	
	
	
	
	
	
Net	loss
	
$
(
775
)
	
$
(
1,063
)
	
$
(
2,241
)
Adjustments	to	reconcile	net	loss	to	net	cash	provided	by	(used	in)	operating	activities:
	
	
	
	
	
	
	
	
	
	
	
	
Depreciation,	amortization	and	impairment
	
	
2,154
	
	
	
1,901
	
	
	
1,636
	
Stock-based	compensation
	
	
898
	
	
	
749
	
	
	
467
	
Amortization	of	debt	discounts	and	issuance	costs
	
	
188
	
	
	
159
	
	
	
91
	
Inventory	and	purchase	commitments	write-downs
	
	
193
	
	
	
85
	
	
	
132
	
Loss	on	disposals	of	fixed	assets
	
	
146
	
	
	
162
	
	
	
106
	
Foreign	currency	transaction	(gains)	loss
	
	
(
48
)
	
	
(
2
)
	
	
52
	
Loss	related	to	SolarCity	acquisition
	
	
—
	
	
	
—
	
	
	
58
	
Non-cash	interest	and	other	operating	activities
	
	
186
	
	
	
49
	
	
	
135
	
Operating	cash	flow	related	to	repayment	of	discounted	convertible	notes
	
	
(


key: chroma:document
string_value:
(
188
)
	
	
—
	
	
	
—
	
Changes	in	operating	assets	and	liabilities,	net	of	effect	of	business	combinations:
	
	
	
	
	
	
	
	
	
	
	
	
Accounts	receivable
	
	
(
367
)
	
	
(
497
)
	
	
(
25
)
Inventory
	
	
(
429
)
	
	
(
1,023
)
	
	
(
179
)
Operating	lease	vehicles
	
	
(
764
)
	
	
(
215
)
	
	
(
1,523
)
Prepaid	expenses	and	other	current	assets
	
	
(
288
)
	
	
(
82
)
	
	
(
72
)
Other	non-current	assets
	
	
115
	
	
	
(
207
)
	
	
(
15
)
Accounts	payable	and	accrued	liabilities
	
	
682
	
	
	
1,723
	
	
	
388
	
Deferred	revenue
	
	
801
	
	
	
406
	
	
	
469
	
Customer	deposits
	
	
(
58
)
	
	
(
96
)
	
	
170
	
Resale	value	guarantee
	
	
(
150
)
	
	
(
111
)
	
	
209
	
Other	long-term	liabilities
	
	
109
	
	
	
160
	
	
	
81
	
Net	cash	provided	by	(used	in)	operating	activities
	
	
2,405
	
	
	
2,098
	
	
	
(
61
)
Cash	Flows	from	Investing	Activities


key: chroma:document
string_value:
Purchases	of	property	and	equipment	excluding	finance	leases,	net	of	sales
	
	
(
1,327
)
	
	
(
2,101
)
	
	
(
3,415
)
Purchases	of	solar	energy	systems
	
	
(
105
)
	
	
(
218
)
	
	
(
666
)
Purchase	of	intangible	assets
	
	
(
5
)
	
	
—
	
	
	
—
	
Receipt	of	government	grants
	
	
46
	
	
	
—
	
	
	
—
	
Business	combinations,	net	of	cash	acquired
	
	
(
45
)
	
	
(
18
)
	
	
(
115
)
Net	cash	used	in	investing	activities
	
	
(
1,436
)
	
	
(
2,337
)
	
	
(
4,196
)
Cash	Flows	from	Financing	Activities
	
	
	
	
	
	
	
	
	
	
	
	
Proceeds	from	issuances	of	common	stock	in	public	offerings,	net	of	underwriting	discounts
	
	
848
	
	
	
—
	
	
	
400
	
Proceeds	from	issuances	of	convertible	and	other	debt
	
	
10,669
	
	
	
6,176
	
	
	
7,138
	
Repayments	of	convertible	and	other	debt
	
	
(
9,161
)
	
	
(
5,247
)
	
	
(
3,996
)
Repayments	of	borrowings	issued	to	related	parties
	
	
—
	
	
	
(
100
)
	
	
(
165
)
Collateralized	lease	repayments
	
	
(
389
)
	
	
(
559


key: chroma:document
string_value:
(
389
)
	
	
(
559
)
	
	
511
	
Proceeds	from	exercises	of	stock	options	and	other	stock	issuances
	
	
263
	
	
	
296
	
	
	
259
	
Principal	payments	on	finance	leases
	
	
(
321
)
	
	
(
181
)
	
	
(
103
)
Common	stock	and	debt	issuance	costs
	
	
(
37
)
	
	
(
15
)
	
	
(
63
)
Purchase	of	convertible	note	hedges
	
	
(
476
)
	
	
—
	
	
	
(
204
)
Proceeds	from	settlement	of	convertible	note	hedges
	
	
—
	
	
	
—
	
	
	
287
	
Proceeds	from	issuance	of	warrants
	
	
174
	
	
	
—
	
	
	
53
	
Payments	for	settlements	of	warrants
	
	
—
	
	
	
—
	
	
	
(
230
)
Proceeds	from	investments	by	noncontrolling	interests	in	subsidiaries
	
	
279
	
	
	
437
	
	
	
790
	
Distributions	paid	to	noncontrolling	interests	in	subsidiaries
	
	
(
311
)
	
	
(
227
)
	
	
(
262
)
Payments	for	buy-outs	of	noncontrolling	interests	in	subsidiaries
	
	
(
9
)
	
	
(
6
)
	
	
—
	
Net	cash	provided	by	financing	activities
	
	
1,529
	
	
	
574
	
	
	
4,415
	
Effect	of	exchange	rate	changes	on	cash	and	cash	equivalents	and	restricted	cash
	
	
8


key: chroma:document
string_value:
8
	
	
	
(
23
)
	
	
40
	
Net	increase	in	cash	and	cash	equivalents	and	restricted	cash
	
	
2,506
	
	
	
312
	
	
	
198
	
Cash	and	cash	equivalents	and	restricted	cash,	beginning	of	period
	
	
4,277
	
	
	
3,965
	
	
	
3,767
	
Cash	and	cash	equivalents	and	restricted	cash,	end	of	period
	
$
6,783
	
	
$
4,277
	
	
$
3,965
	
Supplemental	Non-Cash	Investing	and	Financing	Activities
	
	
	
	
	
	
	
	
	
	
	
	
Equity	issued	in	connection	with	business	combination
	
$
207
	
	
$
—
	
	
$
—
	
Acquisitions	of	property	and	equipment	included	in	liabilities
	
$
562
	
	
$
249
	
	
$
914
	
Estimated	fair	value	of	facilities	under	build-to-suit	leases
	
$
—
	
	
$
94
	
	
$
313
	
Supplemental	Disclosures
	
	
	
	
	
	
	
	
	
	
	
	
Cash	paid	during	the	period	for	interest,	net	of	amounts	capitalized
	
$
455
	
	
$
381
	
	
$
183
	
Cash	paid	during	the	period	for	taxes,	net	of	refunds
	
$
54
	
	
$
35
	
	
$
66
	
The	accompanying	notes	are	an	integral	part	of	these	consolidated	financial	statements.
	
69


key: chroma:document
string_value:
Tesla,	Inc.
Notes	to	Consolidated	Financial	Statements
	
Note	1	–	Overview
Tesla,	Inc.	(“Tesla”,	the	“Company”,	“we”,	“us”	or	“our”)	was	incorporated	in	the	State	of	Delaware	on	July	1,	2003.	We	design,	develop,
manufacture	and	sell	high-performance	fully	electric	vehicles	and	design,	manufacture,	install	and	sell	solar	energy	generation	and	energy	storage
products.	Our	Chief	Executive	Officer,	as	the	chief	operating	decision	maker	(“CODM”),	organizes	the	Company,	manages	resource	allocations	and
measures	performance	among	
two
	operating	and	reportable	segments:	(i)	automotive	and	(ii)	energy	generation	and	storage.
	
	
Note	2	–	Summary	of	Significant	Accounting	Policies
Principles	of	Consolidation
The	accompanying	consolidated	financial	statements	have	been	prepared	in	conformity	with	U.S.	generally	accepted	accounting	principles
(“GAAP”)	and	reflect	our	accounts	and	operations	and	those	of	our	subsidiaries	in	which	we	have	a	controlling	financial	interest.	In	accordance	with	the
provisions	of	Accounting	Standards	Codification	(“ASC”)	810,	
Consolidation
,	we	consolidate	any	variable	interest	entity	(“VIE”)	of	which	we	are	the
primary	beneficiary.	We	form	VIEs	with	financing	fund	investors	in	the	ordinary	course	of	business	in	order	to	facilitate	the	funding	and	monetization	of
certain	attributes	associated	with	solar	energy	systems	and	leases	under	our	direct	vehicle	leasing	programs.	The	typical	condition	for	a	controlling
financial	interest	ownership	is	holding	a	majority	of	the	voting	interests	of	an	entity;	however,	a	controlling	financial	interest	may	also	exist	in	entities,


key: chroma:document
string_value:
such	as	VIEs,	through	arrangements	that	do	not	involve	controlling	voting	interests.	ASC	810	requires	a	variable	interest	holder	to	consolidate	a	VIE	if
that	party	has	the	power	to	direct	the	activities	of	the	VIE	that	most	significantly	impact	the	VIE’s	economic	performance	and	the	obligation	to	absorb
losses	of	the	VIE	that	could	potentially	be	significant	to	the	VIE	or	the	right	to	receive	benefits	from	the	VIE	that	could	potentially	be	significant	to	the
VIE.	We	do	not	consolidate	a	VIE	in	which	we	have	a	majority	ownership	interest	when	we	are	not	considered	the	primary	beneficiary.	We	have
determined	that	we	are	the	primary	beneficiary	of	all	the	VIEs	(see	Note	
17
,	
Variable	Interest	Entity	Arrangements
).	We	evaluate	our	relationships	with
all	the	VIEs	on	an	ongoing	basis	to	ensure	that	we	continue	to	be	the	primary	beneficiary.	All	intercompany	transactions	and	balances	have	been
eliminated	upon	consolidation.
Use	of	Estimates
The	preparation	of	financial	statements	in	conformity	with	GAAP	requires	management	to	make	estimates	and	assumptions	that	affect	the	reported
amounts	of	assets,	liabilities	and	disclosures	in	the	accompanying	notes.	Estimates	are	used	for,	but	not	limited	to,	determining	the	transaction	price	of
products	and	services	in	arrangements	with	multiple	performance	obligations	and	determining	the	amortization	period	of	these	obligations,	significant
economic	incentive	for	residual	value	guarantee	arrangements,	sales	return	reserves,	the	collectability	of	accounts	receivable,	inventory	valuation,	fair
value	of	long-lived	assets,	goodwill,	fair	value	of	financial	instruments,	residual	value	of	operating	lease	vehicles,	depreciable	lives	of	property	and


key: chroma:document
string_value:
equipment	and	solar	energy	systems,	fair	value	and	residual	value	of	solar	energy	systems	subject	to	leases,	warranty	liabilities,	income	taxes,
contingencies,	determining	lease	pass-through	financing	obligations,	the	valuation	of	build-to-suit	lease	assets,	fair	value	of	interest	rate	swaps	and	inputs
used	to	value	stock-based	compensation.	In	addition,	estimates	and	assumptions	are	used	for	the	accounting	for	business	combinations,	including	the	fair
values	and	useful	lives	of	acquired	assets,	assumed	liabilities	and	noncontrolling	interests.	Management	bases	its	estimates	on	historical	experience	and	on
various	other	assumptions	believed	to	be	reasonable,	the	results	of	which	form	the	basis	for	making	judgments	about	the	carrying	values	of	assets	and
liabilities.	Actual	results	could	differ	from	those	estimates.
70


key: chroma:document
string_value:
Revenue	
Recognition
Adoption	of	new	accounting	standards
ASU	2014-09,
	Revenue	-	Revenue	from	Contracts	with	Custome
rs.	On	January	1,	2018,	we	adopted	the	new	accounting	standard	ASC	606,
Revenue	from	Contracts	with	Customers	and	all	the	related	amendments	(“new	revenue	standard”)	using	the	modified	retrospective	method.	As	a	policy
election,	the	new	revenue	standard	was	applied	only	to	contracts	that	were	not	substantially	completed	as	of	the	date	of	adoption.	We	recognized	the
cumulative	effect	of	initially	applying	the	new	revenue	standard	as	an	adjustment	to	the	January	1,	2018	opening	balance	of	accumulated	deficit.	The
prior	period	consolidated	financial	statements	have	not	been	retrospectively	adjusted	and	continue	to	be	reported	under	the	accounting	standards	in
effect	for	those	periods.
A	majority	of	our	automotive	sales	revenue	is	recognized	when	control	transfers	upon	delivery	to	customers.	For	certain	vehicle	sales	where
revenue	was	previously	deferred	as	an	in-substance	operating	lease,	such	as	certain	vehicle	sales	to	customers	or	leasing	partners	with	a	resale	value
guarantee,	we	recognize	revenue	when	the	vehicles	are	delivered	as	a	sale	with	a	right	of	return.	As	a	result,	the	corresponding	operating	lease	asset,
deferred	revenue,	and	resale	value	guarantee	balances	as	of	December	31,	2017,	were	reclassified	to	accumulated	deficit	as	part	of	our	adoption	entry.
Furthermore,	the	warranty	liability	related	to	such	vehicles	has	been	accrued	as	a	result	of	the	change	from	in-substance	operating	leases	to	vehicle
sales.	Prepayments	on	contracts	that	can	be	cancelled	without	significant	penalties,	such	as	vehicle	maintenance	plans,	have	been	reclassified	from


key: chroma:document
string_value:
deferred	revenue	to	customer	deposits.	Refer	to	the	
Automotive	Sales	Revenue
	and	
Automotive	Leasing	Revenue
	sections	below	for	further	discussion
of	the	impact	on	various	categories	of	vehicle	sales.
	
				
Automotive	Segment
Automotive	Sales	Revenue
Automotive	Sales	without	Resale	Value	Guarantee
Automotive	sales	revenue	includes	revenues	related	to	deliveries	of	new	vehicles	and	pay-per-use	charges,	and	specific	other	features	and
services	that	meet	the	definition	of	a	performance	obligation	under	the	new	revenue	standard,	including	access	to	our	Supercharger	network,	internet
connectivity,	Autopilot,	Full	Self-Driving	(“FSD”)	features	and	over-the-air	software	updates.	We	recognize	revenue	on	automotive	sales	upon	delivery	to
the	customer,	which	is	when	the	control	of	a	vehicle	transfers.	Payments	are	typically	received	at	the	point	control	transfers	or	in	accordance	with
payment	terms	customary	to	the	business.	Other	features	and	services	such	as	access	to	our	Supercharger	network,	internet	connectivity	and	over-the-
air	software	updates	are	provisioned	upon	control	transfer	of	a	vehicle	and	recognized	over	time	on	a	straight-line	basis	as	we	have	a	stand-ready
obligation	to	deliver	such	services	to	the	customer.	We	recognize	revenue	related	to	these	other	features	and	services	over	the	performance	period,
which	is	generally	the	expected	ownership	life	of	the	vehicle	or	the	eight-year	life	of	the	vehicle.	Revenue	related	to	Autopilot	and	FSD	features	is
recognized	when	functionality	is	delivered	to	the	customer.	For	our	obligations	related	to	automotive	sales,	we	estimate	standalone	selling	price	by
considering	costs	used	to	develop	and	deliver	the	service,	third-party	pricing	of	similar	options	and	other	information	that	may	be	available.


key: chroma:document
string_value:
At	the	time	of	revenue	recognition,	we	reduce	the	transaction	price	and	record	a	sales	return	reserve	against	revenue	for	estimated	variable
consideration	related	to	future	product	returns.	Such	estimates	are	based	on	historical	experience	and	are	immaterial	in	all	periods	presented.	In
addition,	any	fees	that	are	paid	or	payable	by	us	to	a	customer’s	lender	when	we	arrange	the	financing	are	recognized	as	an	offset	against	automotive
sales	revenue.
Costs	to	obtain	a	contract	mainly	relate	to	commissions	paid	to	our	sales	personnel	for	the	sale	of	vehicles.	Commissions	are	not	paid	on	other
obligations	such	
as
	
access	to	our	Supercharger	network,	internet	connectivity,	Autopilot,	FSD	features	and	over-the-air	software	updates.
	As	our
contract	costs	related	to	automotive	sales	are	typically	fulfilled	within	one	year,	the	costs	to	obtain	a	contract	are	expensed	as	incurred.	Amounts	billed
to	customers	related	to	shipping	and	handling	are	classified	as	automotive	revenue,	and	we	have	elected	to	recognize	the	cost	for	freight	and	shipping
when	control	over	vehicles,	parts,	or	accessories	have	transferred	to	the	customer	as	an	expense	in	cost	of	revenues.	Our	policy	is	to	exclude	taxes
collected	from	a	customer	from	the	transaction	price	of	automotive	contracts.
71


key: chroma:document
string_value:
Automotive	Sales	with	Resale	Value	Guarantee
	or	a	Buyback	Option
We	offer	resale	value	guarantees	or	similar	buy-back	terms	to	certain	international	customers	who	purchase	vehicles	and	who	finance	their
vehicles	through	one	of	our	specified	commercial	banking	partners.	We	also	offer	resale	value	guarantees	in	connection	with	automotive	sales	to	certain
leasing	partners.	Under	these	programs,	we	receive	full	payment	for	the	vehicle	sales	price	at	the	time	of	delivery	and	our	counterparty	has	the	option
of	selling	their	vehicle	back	to	us	during	the	guarantee	period,	which	currently	is	generally	at	the	end	of	the	term	of	the	applicable	loan	or	financing
program,	for	a	pre-determined	resale	value.
With	the	exception	of	two	programs	which	are	discussed	within	the	
Automotive	Leasing
	section,	we	recognize	revenue	when	control	transfers
upon	delivery	to	customers	
in	accordance	with	the	new	revenue	standard	
as	a	sale	with	a	right	of	return	as	we	do	not	believe	the	customer	has	a
significant	economic	incentive	to	exercise	the	resale	value	guarantee	provided	to	them.	The	process	to	determine	whether	there	is	a	significant
economic	incentive	includes	a	comparison	of	a	vehicle’s	estimated	market	value	at	the	time	the	option	is	exercisable	with	the	guaranteed	resale	value	to
determine	the	customer’s	economic	incentive	to	exercise.	The	performance	obligations	and	the	pattern	of	recognizing	automotive	sales	with	resale
value	guarantees	are	consistent	with	automotive	sales	without	resale	value	guarantees	with	the	exception	of	our	estimate	for	sales	return	reserve.	Sales
return	reserves	for	automotive	sales	with	resale	value	guarantees	are	estimated	based	on	historical	experience	plus	consideration	for	expected	future
market	values.


key: chroma:document
string_value:
market	values.	
On	a	quarterly	basis,	we	assess	the	estimated	market	values	of	vehicles	under	our	buyback	options	program	to	determine	whether	there
have	been	changes	to	the	likelihood	of	future	product	returns.	As	we	accumulate	more	data	related	to	the	buyback	values	of	our	vehicles	or	as	market
conditions	change,	there	may	be	material	changes	to	their	estimated	values.	Due	to	price	adjustments	we	made	to	our	vehicle	offerings	during	2019,	we
estimated	that	there	is	a	greater	likelihood	that	customers	will	exercise	their	buyback	options	that	were	provided	prior	to	such	adjustments.	As	a	result,
along	with	the	estimated	variable	consideration	related	to	normal	future	product	returns	for	vehicles	sold	under	the	buyback	options	program,	we
adjusted	our	sales	return	reserve	on	vehicles	previously	sold	under	our	buyback	options	program	resulting	in	a	reduction	of	automotive	sales	revenues
of	$
555
	million	for	the	year	ended	December	31,	2019.	If	customers	elect	to	exercise	the	buyback	option,	we	expect	to	be	able	to	subsequently	resell	the
returned	vehicles,	which	resulted	in	a	corresponding	reduction	in	cost	of	automotive	sales	of	$
451
	million	for	the	year	ended	December	31,	2019.	The
net	impact	was	$
104
	million	reduction	in	gross	profit	for	the	year	ended	December	31,	2019.	The	total	sales	return	reserve	on	vehicles	previously	sold
under	our	buyback	options	program	was	$
639
	million	as	of	December	31,	2019,	of	which	$
93
	million	was	short	term.	
The	two	programs	that	are	still
being	recorded	as	operating	leases	are	discussed	in	further	detail	below	in	
Vehicle	Sales	to	Leasing	Partners	with	a	Resale	Value	Guarantee	and	a


key: chroma:document
string_value:
Buyback	Option
	and	
Vehicle	Sales	to	Customers	with	a	Resale	Value	Guarantee	where	Exercise	is	Probable.
Prior	to	the	adoption	of	the	new	revenue	standard,	all	transactions	with	resale	value	guarantees	were	recorded	as	operating	leases.	The	amount
of	sale	proceeds	equal	to	the	resale	value	guarantee	was	deferred	until	the	guarantee	expired	or	was	exercised.	
For	certain	transactions	that	were
considered	interest	bearing	collateralized	borrowings	as	required	under	ASC	840,	
Leases
	prior	to	January	1,	2019,	we	also	accrued	interest	expense
based	on	our	borrowing	rate.	
The	remaining	sale	proceeds	were	deferred	and	recognized	on	a	straight-line	basis	over	the	stated	guarantee	period	to
automotive	leasing	revenue.	The	guarantee	period	expired	at	the	earlier	of	the	end	of	the	guarantee	period	or	the	pay-off	of	the	initial	loan.	We
capitalized	the	cost	of	these	vehicles	on	the	consolidated	balance	sheet	as	operating	lease	vehicles,	net,	and	depreciated	their	value,	less	estimated
residual	value,	to	cost	of	automotive	leasing	revenue	over	the	same	period.
In	cases	where	our	counterparty	retained	ownership	of	the	vehicle	at	the	end	of	the	guarantee	period,	the	resale	value	guarantee	liability	and
any	remaining	deferred	revenue	balances	related	to	the	vehicle	were	settled	to	automotive	leasing	revenue,	and	the	net	book	value	of	the	leased	vehicle
was	expensed	to	cost	of	automotive	leasing	revenue.	If	our	counterparty	returned	the	vehicle	to	us	during	the	guarantee	period,	we	purchased	the
vehicle	from	our	counterparty	in	an	amount	equal	to	the	resale	value	guarantee	and	settled	any	remaining	deferred	balances	to	automotive	leasing


key: chroma:document
string_value:
revenue,	and	we	reclassified	the	net	book	value	of	the	vehicle	on	the	consolidated	balance	sheet	to	used	vehicle	inventory.
72


key: chroma:document
string_value:
Deferred	revenue	activity	related	to	the	access	to	our	Supercharger	network,	internet	connectivity,	Autopilot,	FSD	features	and	over-the-air
software	updates	on	automotive	sales	with	and	without	resale	value	guarantee	consisted	of	the	following	(in	millions):
	
	
	
Year	ended	December	31,
	
	
	
2019
	
	
2018
	
Deferred	revenue	on	automotive	sales	with	and	without
			resale	value	guarantee—	beginning	of	period
	
$
883
	
	
$
476
	
Additions
	
	
880
	
	
	
532
	
Net	changes	in	liability	for	pre-existing	contracts
	
	
9
	
	
	
(
13
)
Revenue	recognized
	
	
(
300
)
	
	
(
112
)
Deferred	revenue	on	automotive	sales	with	and	without
			resale	value	guarantee—	end	of	period
	
$
1,472
	
	
$
883
	
Deferred	revenue	is	equivalent	to	the	total	transaction	price	allocated	to	the	performance	obligations	that	are	unsatisfied,	or	partially
unsatisfied,	as	of	December	31,	2019.	From	the	deferred	revenue	balance	as	of	December	31,	2018,	revenue	recognized	during	the	year	ended
December	31,	2019	was	$
220
		million.	
From	the	deferred	revenue	balance	as	of	January	1,	2018,	revenue	recognized	during	the	year	ended
December	31,	2018	was	$
81
	million.	
Of	the	total	deferred	revenue	on	automotive	sales	with	and	without	resale	value	guarantees	as	of	December	31,
2019,	we	expect	to	recognize	$
751
	million	of	revenue	in	the	next	12	months.	The	remaining	balance	will	be	recognized	over	the	performance	period	as
discussed	above	in


key: chroma:document
string_value:
discussed	above	in	
Automotive	Sales	without	Resale	Value	Guarantee
.
Automotive	Regulatory	Credits
In	connection	with	the	production	and	delivery	of	our	zero	emission	vehicles	in	global	markets,	we	have	earned	and	will	continue	to	earn	various
tradable	automotive	regulatory	credits.	We	have	sold	these	credits,	and	will	continue	to	sell	future	credits,	to	automotive	companies	and	other	regulated
entities	who	can	use	the	credits	to	comply	with	emission	standards	and	other	regulatory	requirements.	For	example,	under	California’s	Zero	Emission
Vehicle	Regulation	and	those	of	states	that	have	adopted	California’s	standard,	vehicle	manufacturers	are	required	to	earn	or	purchase	credits,	referred
to	as	ZEV	credits,	for	compliance	with	their	annual	regulatory	requirements.	These	laws	provide	that	automakers	may	bank	or	sell	to	other	regulated
parties	their	excess	credits	if	they	earn	more	credits	than	the	minimum	quantity	required	by	those	laws.	We	also	earn	other	types	of	saleable	regulatory
credits	in	the	United	States	and	abroad,	including	greenhouse	gas,	fuel	economy	and	clean	fuels	credits.	
Payments	for	regulatory	credits	are	typically
received	at	the	point	control	transfers	to	the	customer,	or	in	accordance	with	payment	terms	customary	to	the	business.
We	recognize	revenue	on	the	sale	of	automotive	regulatory	credits	at	the	time	control	of	the	regulatory	credits	is	transferred	to	the	purchasing
party	as	automotive	revenue	in	the	consolidated	statements	of	operations.	Revenue	from	the	sale	of	automotive	regulatory	credits	totaled	$
594
	million,
$
419
	million	and	$
360
	million	for	the	years	ended	December	31,	2019,	2018	and	2017,	respectively.		
Deferred	revenue	related	to	sales	of	automotive


key: chroma:document
string_value:
Deferred	revenue	related	to	sales	of	automotive
regulatory	credits	was	$
140
	million	and	$
0
	as	of	
December	31,	2019
	and	2018,	respectively.	We	expect	to	recognize	the	deferred	revenue	as	of
December	31,	2019	in	the	next	
12
	months.
Automotive	Leasing	Revenue
Automotive	leasing	revenue	includes	revenue	recognized	under	lease	accounting	guidance	for	our	direct	leasing	programs	as	well	as	the	two
programs	with	resale	value	guarantees
	which	continue	to	qualify	for	operating	lease	treatment.	Prior	to	the	adoption	of	the	new	revenue	standard,	all
programs	with	resale	value	guarantees	were	accounted	for	as	operating	leases
.
73


key: chroma:document
string_value:
Direct	Vehicle	Leasing	Program
We	have	outstanding	leases	under	our	direct	vehicle	leasing	programs	in	the	U.S.,	Canada	and	in	certain	countries	in	Europe.	As	of	December
31,	2019,	the	direct	vehicle	leasing	program	is	offered	for	all	new	Model	S,	Model	X	and	Model	3	vehicles	in	the	U.S.	and	for	new	Model	S	and	Model	X
vehicles	in	Canada.	Qualifying	customers	are	permitted	to	lease	a	vehicle	directly	from	Tesla	for	up	to	
48
	months.	At	the	end	of	the	lease	term,
customers	are	required	to	return	the	vehicles	to	us	or	for	Model	S	and	Model	X	leases,	may	opt	to	purchase	the	vehicles	for	a	pre-determined	residual
value.	
We	account	for	these	leasing	transactions	as	operating	leases.	We	record	leasing	revenues	to	
automotive	leasing	revenue
	on	a	straight-line	basis
over	the	contractual	term,	and	we	record	the	depreciation	of	these	vehicles	to	cost	of	automotive	leasing	revenue.	For	the	years	ended	December	31,
2019,	2018	and	2017	,	we	recognized		$
532
	million,	$
393
	million	and	$
221
	million	of	direct	vehicle	leasing	revenue,	respectively	.	As	of	December	31,
2019	and	2018,	we	had	deferred	$
218
	million	and	$
110
	million,	respectively,	of	lease-related	upfront	payments,	which	will	be	recognized	on	a	straight-
line	basis	over	the	contractual	terms	of	the	individual	leases.
We
	capitalize	shipping	costs	and	initial	direct	costs	such	as	the	incremental	cost	of	referral	fees	and	sales	commissions	from	the	origination	of
automotive	lease	agreements	as	an	element	of	operating	lease	vehicles,	net,	and	subsequently	amortize	these	costs	over	the	term	of	the	related	lease


key: chroma:document
string_value:
agreement.	Our	policy	is	to	exclude	taxes	collected	from	a	customer	from	the	transaction	price	of	automotive	contracts.	Total	capitalized	costs	were
immaterial	as	of	December	31,	2019	and	2018.
Vehicle	Sales	to	Leasing	Partners	with	a	Resale	Value	Guarantee	and	a	Buyback	Option
We	offer	buyback	options	in	connection	with	automotive	sales	with	resale	value	guarantees	with	certain	leasing	partner	sales	in	the	United
States.	These	transactions	entail	a	transfer	of	leases,	which	we	have	originated	with	an	end-customer,	to	our	leasing	partner.	As	control	of	the	vehicles
has	not	been	transferred	
in	accordance	with	the	new	revenue	standard
,	these	transactions	were	accounted	for	as	interest	bearing	collateralized
borrowings	in	accordance	with	ASC	840,	
Leases
,	prior	to	January	1,	2019.	Under	this	program,	cash	is	received	for	the	full	price	of	the	vehicle	and	the
collateralized	borrowing	value	is	generally	recorded	within	resale	value	guarantees	and	the	customer	upfront	down	payment	is	recorded	within
deferred	revenue.	We	amortize	the	deferred	revenue	amount	to	automotive	leasing	revenue	on	a	straight-line	basis	over	the	option	period	and	accrue
interest	expense	based	on	our	borrowing	rate.	The	option	period	expires	at	the	earlier	of	the	end	of	the	contractual	option	period	or	the	pay-off	of	the
initial	loan.	We	capitalize	vehicles	under	this	program	to	operating	lease	vehicles,	net,	on	the	consolidated	balance	sheets,	and	we	record	depreciation
from	these	vehicles	to	cost	of	automotive	leasing	revenue	during	the	period	the	vehicle	is	under	a	lease	arrangement.	Cash	received	for	these	vehicles,


key: chroma:document
string_value:
net	of	revenue	recognized	during	the	period,	is	classified	as	collateralized	lease	(repayments)	borrowings	within	cash	flows	from	financing	activities	in
the	consolidated	statements	of	cash	flows.	Following	the	adoption	of	ASC	842	on	January	1,	2019,	all	new	agreements	under	this	program	are	accounted
for	as	operating	leases	and	there	was	no	material	change	in	the	timing	and	amount	of	revenue	recognized	over	the	term.	Consequently,	any	cash	flows
for	new	agreements	are	classified	as	operating	cash	activities	on	the	consolidated	statements	of	cash	flows.
At	the	end	of	the	lease	term,	we	settle	our	liability	in	cash	by	either	purchasing	the	vehicle	from	the	leasing	partner	for	the	buyback	option
amount	or	paying	a	shortfall	to	the	option	amount	the	leasing	partner	may	realize	on	the	sale	of	the	vehicle.	Any	remaining	balances	within	deferred
revenue	and	resale	value	guarantee	will	be	settled	to	automotive	leasing	revenue.	
The	end	customers	can	extend	the	lease	for	a	period	of	up	to	6
months.	
In	cases	where	the	leasing	partner	retains	ownership	of	the	vehicle	after	the	end	of	our	option	period,	we	expense	the	net	value	of	the	leased
vehicle	to	cost	of	automotive	leasing	revenue
.	The	maximum	amount	we	could	be	required	to	pay	under	this	program,	should	we	decide	to	repurchase
all	vehicles,	was
	
	$
214
	million	and	$
480
	million	as	of	December	31,	2019	and	2018,	respectively,	including	$
178
		
million	within	a	12-month	period	from
December	31,	2019.
	
As	of	December	31,	2019	and	2018
,
	we	had	$
238
		million
	and	$
558


key: chroma:document
string_value:
238
		million
	and	$
558
	million,	respectively,	of	such	borrowings	recorded	in	resale
value	guarantees	and	$
29
		
million	and	$
93
	million,	respectively,	recorded	in	deferred	revenue	liability.
	For	the	year	ended	December	31,	2019	and
2018,	we	recognized		$
186
		million	and	$
332
	million,	respectively,	of	leasing	revenue	related	to	this	program.	The	net	carrying	amount	of	operating
lease	vehicles	under	this	program	was	$
190
	million	and	$
469
	million,	respectively,	as	of	December	31,	2019	and	2018.
74


key: chroma:document
string_value:
Vehicle
	S
ales
	to	Customers	with	a	Resale	Value	Guarantee	where	Exercise	is	Probable
For	certain	international	programs	where	we	have	offered	resale	value	guarantees	to	certain	customers	who	purchased	vehicles	and	where	we
expect	the	customer	has	a	significant	economic	incentive	to	exercise	the	resale	value	guarantee	provided	to	them,	we	continue	to	recognize	these
transactions	as	operating	leases.	The	process	to	determine	whether	there	is	a	significant	economic	incentive	includes	a	comparison	of	a	vehicle’s
estimated	market	value	at	the	time	the	option	is	exercisable	with	the	guaranteed	resale	value	to	determine	the	customer’s	economic	incentive	to
exercise.	We	have	not	sold	any	vehicles	under	this	program	since	the	first	half	of	2017	and	all	current	period	activity	relates	to	the	exercise	or
cancellation	of	active	transactions.	The	amount	of	sale	proceeds	equal	to	the	resale	value	guarantee	is	deferred	until	the	guarantee	expires	or	is
exercised.	The	remaining	sale	proceeds	are	deferred	and	recognized	on	a	straight-line	basis	over	the	stated	guarantee	period	to	automotive	leasing
revenue.	The	guarantee	period	expires	at	the	earlier	of	the	end	of	the	guarantee	period	or	the	pay-off	of	the	initial	loan.	We	capitalize	the	cost	of	these
vehicles	on	the	consolidated	balance	sheet	as	operating	lease	vehicles,	net,	and	depreciate	their	value,	less	salvage	value,	to	cost	of	automotive	leasing
revenue	over	the	same	period.
In	cases	where	a	customer	retains	ownership	of	a	vehicle	at	the	end	of	the	guarantee	period,	the	resale	value	guarantee	liability	and	any
remaining	deferred	revenue	balances	related	to	the	vehicle	are	settled	to	automotive	leasing	revenue,	and	the	net	book	value	of	the	leased	vehicle	is


key: chroma:document
string_value:
expensed	to	cost	of	automotive	leasing	revenue.	If	a	customer	returns	the	vehicle	to	us	during	the	guarantee	period,	we	purchase	the	vehicle	from	the
customer	in	an	amount	equal	to	the	resale	value	guarantee	and	settle	any	remaining	deferred	balances	to	automotive	leasing	revenue,	and	we	reclassify
the	net	book	value	of	the	vehicle	on	the	consolidated	balance	sheets	to	used	vehicle	inventory.	As	of	December	31,	2019	and	2018,	$
115
		million	and
$
150
	million,	respectively,	of	the	guarantees	were	exercisable	by	customers	within	the	next	12	months.	For	the	year	ended	December	31,	2019	and
2018,	we	recognized	$
150
			million	and	$
158
	million,	respectively,	of	leasing	revenue	related	to	this	program.	
The	net	carrying	amount	of	operating
lease	vehicles	under	this	program	was	$
83
	million	and	$
212
	million,	respectively,	as	of	December	31,	2019	and	2018.
Services	and	Other	Revenue
Services	and	other	revenue	consists	of	non-warranty	after-sales	vehicle	services,	sales	of	used	vehicles,	retail	merchandise,	sales	by	our
acquired	subsidiaries	to	third	party	customers,	and	vehicle	insurance	revenue.	
There	were	no	significant	changes	to	the	timing	or	amount	of	revenue
recognition	as	a	result	of	our	adoption	of	the	new	revenue	standard.
Revenues	related	to	repair	and	maintenance	services	are	recognized	over	time	as	services	are	provided	and	extended	service	plans	are
recognized	over	the	performance	period	of	the	service	contract	as	the	obligation	represents	a	stand-ready	obligation	to	the	customer.	We	sell	used


key: chroma:document
string_value:
vehicles,	services,	service	plans,	vehicle	components	and	merchandise	separately	and	thus	use	standalone	selling	prices	as	the	basis	for	revenue
allocation	to	the	extent	that	these	items	are	sold	in	transactions	with	other	performance	obligations.	Payment	for	used	vehicles,	services,	and
merchandise	are	typically	received	at	the	point	when	control	transfers	to	the	customer	or	in	accordance	with	payment	terms	customary	to	the	business.
Payments	received	for	prepaid	plans	are	refundable	upon	customer	cancellation	of	the	related	contracts	and	are	included	within	customer	deposits	on
the	consolidated	balance	sheet.	Deferred	revenue	related	to	services	and	other	revenue	was	immaterial	as	of	December	31,	2019	and	2018.
	
75


key: chroma:document
string_value:
Energy	Generation	and	Storage	Segment
Energy	Generation	and	Storage	Sales
Energy	generation	and	storage	sales	revenue	consists	of	the	sale	of	solar	energy	systems	and	energy	storage	systems	to	residential,	small
commercial,	and	large	commercial	and	utility	grade	customers.	Upon	adoption	of	the	new	lease	standard	(refer	to	
Leases	
section	below	for	details),
energy	generation	and	storage	sales	revenue	includes	agreements	for	solar	energy	systems	and	power	purchase	agreements	(“PPAs”)	that	commence
after	January	1,	2019,	as	these	are	now	accounted	for	under	the	new	revenue	standard.	Sales	of	solar	energy	systems	to	residential	and	small	scale
commercial	customers	consist	of	the	engineering,	design,	and	installation	of	the	system.	Post	installation,	residential	and	small	scale	commercial
customers	receive	a	proprietary	monitoring	system	that	captures	and	displays	historical	energy	generation	data.	Residential	and	small	scale	commercial
customers	pay	the	full	purchase	price	of	the	solar	energy	system	upfront.	Revenue	for	the	design	and	installation	obligation	is	recognized	when	control
transfers,	which	is	when	we	install	a	solar	energy	system	and	the	system	passes	inspection	by	the	utility	or	the	authority	having	jurisdiction.	Revenue
for	the	monitoring	service	is	recognized	ratably	as	a	stand-ready	obligation	over	the	warranty	period	of	the	solar	energy	system.	
Sales	of	energy	storage
systems	to	residential	and	small	scale	commercial	customers	consist	of	the	installation	of	the	energy	storage	system	and	revenue	is	recognized	when
control	transfers,	which	is	when	the	product	has	been	delivered	or,	if	we	are	performing	installation,	when	installed	and	commissioned.	Payment	for
such	storage	systems	is	made	upon	invoice	or	in	accordance	with	payment	terms	customary	to	the	business.


key: chroma:document
string_value:
For	large	commercial	and	utility	grade	solar	energy	system	and	energy	storage	system	sales	which	consist	of	the	engineering,	design,	and
installation	of	the	system,	customers	make	milestone	payments	that	are	consistent	with	contract-specific	phases	of	a	project.	Revenue	from	such
contracts	is	recognized	over	time	using	the	percentage	of	completion	method	based	on	cost	incurred	as	a	percentage	of	total	estimated	contract	costs
for	energy	storage	system	sales	and	as	a	percentage	of	total	estimated	labor	hours	for	solar	energy	system	sales
.	Certain	large-scale	commercial	and
utility	grade	solar	energy	system	and	energy	storage	system	sales	also	include	operations	and	maintenance	service	which	are	negotiated	with	the
design	and	installation	contracts	and	are	thus	considered	to	be	a	combined	contract	with	the	design	and	installation	service.	For	certain	large
commercial	and	utility	grade	solar	energy	systems	and	energy	storage	systems	where	the	percentage	of	completion	method	does	not	apply,	
revenue	is
recognized	when	control	transfers,	which	is	when	the	product	has	been	delivered	to	the	customer	and	commissioned	for	energy	storage	systems	and
when	the	project	has	received	permission	to	operate	from	the	utility	for	solar	energy	systems.	
Operations	and	maintenance	service	revenue	is
recognized	ratably	over	the	respective	contract	term
	for	solar	energy	system	sales	and	upon	delivery	of	the	service	for	energy	storage	system	sales
.
Customer	payments	for	such	services	are	usually	paid	annually	or	quarterly	in	advance.
In	instances	where	there	are	multiple	performance	obligations	in	a	single	contract,	we	allocate	the	consideration	to	the	various	obligations	in
the	contract	based	on	the	relative	standalone	selling	price	method.	Standalone	selling	prices	are	estimated	based	on	estimated	costs	plus	margin	or


key: chroma:document
string_value:
using	market	data	for	comparable	products.	Costs	incurred	on	the	sale	of	residential	installations	before	the	solar	energy	systems	are	completed	are
included	as	work	in	process	within	inventory	in	the	consolidated	balance	sheets.	However,	any	fees	that	are	paid	or	payable	by	us	to	a	solar	loan	lender
would	be	recognized	as	an	offset	against	revenue.	Costs	to	obtain	a	contract	relate	mainly	to	commissions	paid	to	our	sales	personnel	related	to	the	sale
of	solar	energy	systems	and	energy	storage	systems.	As	our	contract	costs	related	to	solar	energy	system	and	energy	storage	system	sales	are	typically
fulfilled	within	one	year,	the	costs	to	obtain	a	contract	are	expensed	as	incurred.
As	part	of	our	solar	energy	system	and	energy	storage	system	contracts,	we	may	provide	the	customer	with	performance	guarantees	that
warrant	that	the	underlying	system	will	meet	or	exceed	the	minimum	energy	generation	or	retention	requirements	specified	in	the	contract.	In	certain
instances,	we	may	receive	a	bonus	payment	if	the	system	performs	above	a	specified	level.	Conversely,	if	a	solar	energy	system	or	energy	storage
system	does	not	meet	the	performance	guarantee	requirements,	we	may	be	required	to	pay	liquidated	damages.	Other	forms	of	variable	consideration
related	to	our	large	commercial	and	utility	grade	solar	energy	system	and	energy	storage	system	contracts	include	variable	customer	payments	that	will
be	made	based	on	our	energy	market	participation	activities.	Such	guarantees	and	variable	customer	payments	represent	a	form	of	variable
consideration	and	are	estimated	at	contract	inception	at	their	most	likely	amount	and	updated	at	the	end	of	each	reporting	period	as	additional


key: chroma:document
string_value:
performance	data	becomes	available.	Such	estimates	are	included	in	the	transaction	price	only	to	the	extent	that	it	is	probable	a	significant	reversal	of
revenue	will	not	occur.
76


key: chroma:document
string_value:
We	record	as	deferred	revenue	any	non-refundable	amounts	that	are	collected	from	customers	related	to	fees	charged	for	prepayments	and
remote	monitoring	service	and	operations	and	maintenance	service,	which	is	recognized	as	revenue	ratably	over	the	respective	customer	contract	term.
As	of	December	31,	2019	and	2018,	deferred	revenue	related	to	such	customer	payments	amounted	to	$
156
	million	and	$
149
	million,	respectively.
Revenue	recognized	from	the	deferred	revenue	balance	as	of	December	31,	2018	was	$
41
	million	for	the	year	ended	December	31,	2019.	
Revenue
recognized	from	the	deferred	revenue	balance	as	of	January	1,	2018	was	$
41
	million	for	the	year	ended	December	31,	2018.	
We	have	elected	the
practical	expedient	to	omit	disclosure	of	the	amount	of	the	transaction	price	allocated	to	remaining	performance	obligations	for	energy	generation	and
storage	sales	with	an	original	expected	contract	length	of	one	year	or	less	and	the	amount	that	we	have	the	right	to	invoice	when	that	amount
corresponds	directly	with	the	value	of	the	performance	to	date.	As	of	December	31,	2019,	total	transaction	price	allocated	to	performance	obligations
that	were	unsatisfied	or	partially	unsatisfied	for	contracts	with	an	original	expected	length	of	more	than	one	year	was	$
103
		million.	Of	this	amount,	we
expect	to	recognize	$
5
		million	in	the	next	12	months	and	the	remaining	over	a	period	up	to	
28
	years.
Energy	Generation	and	Storage	Leasing
For	revenue	arrangements	where	we	are	the	lessor	under	operating	lease	agreements	for	
energy	generation	and	storage	products
,	we	record


key: chroma:document
string_value:
energy	generation	and	storage	products
,	we	record
lease	revenue	from	minimum	lease	payments,	including	upfront	rebates	and	incentives	earned	from	such	systems,	on	a	straight-line	basis	over	the	life	of
the	lease	term,	assuming	all	other	revenue	recognition	criteria	have	been	met.	The	difference	between	the	payments	received	and	the	revenue
recognized	is	recorded	as	deferred	revenue	on	the	consolidated	balance	sheet.
For	solar	energy	systems	where	customers	purchase	electricity	from	us	under	PPAs	prior	to	January	1,	2019,	we	have	determined	that	these
agreements	should	be	accounted	for	as	operating	leases	pursuant	to	ASC	840.	Revenue	is	recognized	based	on	the	amount	of	electricity	delivered	at
rates	specified	under	the	contracts,	assuming	all	other	revenue	recognition	criteria	are	met.
We	record	as	deferred	revenue	any	amounts	that	are	collected	from	customers,	including	lease	prepayments,	in	excess	of	revenue	recognized
and	operations	and	maintenance	service,	which	is	recognized	as	revenue	ratably	over	the	respective	customer	contract	term.	As	of	December	31,	2019
and	2018,	deferred	revenue	related	to	such	customer	payments	amounted	to	$
226
		million	and	$
225
	million,	respectively.	Deferred	revenue	also
includes	the	portion	of	rebates	and	incentives	received	from	utility	companies	and	various	local	and	state	government	agencies,	which	is	recognized	as
revenue	over	the	lease	term.	As	of	December	31,	2019	and	December	31,	2018,	deferred	revenue	from	rebates	and	incentives	amounted	to	$
36
		million
and	$
37
	million,	respectively.


key: chroma:document
string_value:
and	$
37
	million,	respectively.
We	capitalize	initial	direct	costs	from	the	execution	of	agreements	for	solar	energy	systems	and	PPAs,	which	include	the	referral	fees	and	sales
commissions,	as	an	element	of	solar	energy	systems,	net,	and	subsequently	amortize	these	costs	over	the	term	of	the	related	agreements.
77


key: chroma:document
string_value:
Revenue	by	source
The	following	table	disaggregates	our	revenue	by	major	source	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
Automotive	sales	without	resale	value	guarantee
	
$
19,212
	
	
$
15,810
	
Automotive	sales	with	resale	value	guarantee	(1)
	
	
146
	
	
	
1,403
	
Automotive	regulatory	credits
	
	
594
	
	
	
419
	
Energy	generation	and	storage	sales	(2)
	
	
1,000
	
	
	
1,056
	
Services	and	other
	
	
2,226
	
	
	
1,391
	
Total	revenues	from	sales	and	services
	
	
23,178
	
	
	
20,079
	
Automotive	leasing
	
	
869
	
	
	
883
	
Energy	generation	and	storage	leasing	(2)
	
	
531
	
	
	
499
	
Total	revenues
	
$
24,578
	
	
$
21,461
	
	
(1)
We	made	pricing	adjustments	to	our	vehicle	offerings	in	2019,	which	resulted	in	a	reduction	of	automotive	sales	with	resale	value	guarantee
revenues.	Refer	to	
Automotive	Sales	with	Resale	Value	Guarantee
	section	above	for	details.	The	amount	presented	represents	automotive	sales
with	resale	value	guarantee	in	year	ended	December	31,	2019	net	of	such	pricing	adjustments	impact.
(2)
Under	ASC	842,	
Leases
,	solar	energy	system	sales	and	PPAs	that	commence	after	January	1,	2019,	where	we	are	the	lessor	and	were	previously


key: chroma:document
string_value:
accounted	for	as	leases,	no	longer	meet	the	definition	of	a	lease	and	are	instead	accounted	for	in	accordance	with	the	new	revenue	standard
(refer	to	the	
Leases
	section	below	for	details).
	
Cost	of	Revenues
Automotive	Segment
Automotive	Sales
Cost	of	automotive	sales	revenue	includes	direct	parts,	material	and	labor	costs,	manufacturing	overhead,	including	depreciation	costs	of
tooling	and	machinery,	shipping	and	logistic	costs,	vehicle	connectivity	costs,	allocations	of	electricity	and	infrastructure	costs	related	to	our
Supercharger	network,	and	reserves	for	estimated	warranty	expenses.	Cost	of	automotive	sales	revenues	also	includes	adjustments	to	warranty	expense
and	charges	to	write	down	the	carrying	value	of	our	inventory	when	it	exceeds	its	estimated	net	realizable	value	and	to	provide	for	obsolete	and	on-
hand	inventory	in	excess	of	forecasted	demand
.
Automotive	Leasing
Cost	of	automotive	leasing	revenue	includes	primarily	the	amortization	of	operating	lease	vehicles	over	the	lease	term,	as	well	as	warranty
expenses	recognized	as	incurred.	Cost	of	automotive	leasing	revenue	also	includes	vehicle	connectivity	costs	and	allocations	of	electricity	and
infrastructure	costs	related	to	our	Supercharger	network	for	vehicles	under	our	leasing	programs
.
Services	and	Other
Costs	of	services	and	other	revenue	includes	costs	associated	with	providing	non-warranty	after-sales	
services
,	costs	to	acquire	and	certify	used
vehicles,	costs	for	retail	merchandise,	and	costs	to	provide	vehicle	insurance.	Cost	of	services	and	other	revenue	also	includes	direct	parts,	material	and
labor	costs,	manufacturing	overhead	associated	with	the	sales	by	our	acquired	subsidiaries	to	third	party	customers
.


key: chroma:document
string_value:
Energy	Generation	and	Storage	Segment
Energy	Generation	and	Storage
Energy	generation	and	storage	cost	of	revenue	includes	direct	and	indirect	material	and	labor	costs,	warehouse	rent,	freight,	warranty	expense,
other	overhead	costs	and	amortization	of	certain	acquired	intangible	assets.	In	addition,	where	arrangements	are	accounted	for	as	operating	leases,	the
cost	of	revenue	is	primarily	comprised	of	depreciation	of	the	cost	of	leased	solar	energy	systems,	maintenance	costs	associated	with	those	systems	and
amortization	of	any	initial	direct	costs.
	
Leases
In	February	2016,	the	FASB	issued	ASU	No.	2016-02	(“ASC	842”),	Leases,	to	require	lessees	to	recognize	all	leases,	with	certain	exceptions,	on	the
balance	sheet,	while	recognition	on	the	statement	of	operations	will	remain	similar	to	lease	accounting	under	ASC	840.	Subsequently,	the	FASB	issued
ASU	No.	2018-10,	Codification	Improvements	to	Topic	842,	Leases,	ASU	No.	2018-11,	Targeted	Improvements,	ASU	No.	2018-20,	Narrow-Scope
Improvements	for	Lessors,	and	ASU	2019-01,	Codification	Improvements,	to	clarify	and	amend	the	guidance	in	ASU	No.	2016-02.	ASC	842	eliminates	real
estate-specific	provisions	and	modifies	certain	aspects	of	lessor	accounting.	We	adopted	ASC	842	as	of	January	1,	2019	using	the	cumulative	effect
adjustment	approach	(“adoption	of	the	new	lease	standard”).	In	addition,	we	elected	the	package	of	practical	expedients	permitted	under	the	transition


key: chroma:document
string_value:
guidance	within	the	new	standard,	which	allowed	us	to	carry	forward	the	historical	determination	of	contracts	as	leases,	lease	classification	and	not
reassess	initial	direct	costs	for	historical	lease	arrangements.	Accordingly,	previously	reported	financial	statements,	including	footnote	disclosures,	have
not	been	recast	to	reflect	the	application	of	the	new	standard	to	all	comparative	periods	presented.	The	finance	lease	classification	under	ASC	842	includes
leases	previously	classified	as	capital	leases	under	ASC	840.
Agreements	for	solar	energy	system	leases	and	PPAs	(solar	leases)	that	commence	after	January	1,	2019,	where	we	are	the	lessor	and	were
previously	accounted	for	as	operating	leases	no	longer	meet	the	definition	of	a	lease	upon	the	adoption	of	ASC	842	and	are	instead	accounted	for	in
accordance	with	the	revenue	standard.	Under	these	two	types	of	arrangements,	the	customer	is	not	responsible	for	the	design	of	the	energy	system	but
rather	approved	the	energy	system	benefits	in	terms	of	energy	capacity	and	production	to	be	received	over	the	term.	Accordingly,	the	revenue	from
solar	leases	commencing	after	January	1,	2019	are	now	recognized	as	earned,	based	on	the	amount	of	capacity	provided	or	electricity	delivered	at	the
contractual	billing	rates,	assuming	all	other	revenue	recognition	criteria	have	been	met.	Under	the	practical	expedient	available	under	ASC	606-10-55-
18,	we	recognize	revenue	based	on	the	value	of	the	service	which	is	consistent	with	the	billing	amount.
We	have	lease	agreements	with	lease	and	non-lease	components,	and	have	elected	to	utilize	the	practical	expedient	to	account	for	lease	and


key: chroma:document
string_value:
non-lease	components	together	as	a	single	combined	lease	component,	from	both	a	lessee	and	lessor	perspective.	From	a	lessor	perspective,	the	timing
and	pattern	of	transfer	are	the	same	for	the	non-lease	components	and	associated	lease	component	and,	the	lease	component,	if	accounted	for
separately,	would	be	classified	as	an	operating	lease.	Additionally,	leases	previously	identified	as	build-to-suit	leasing	arrangements	under	legacy	lease
accounting	(ASC	840),	were	derecognized	pursuant	to	the	transition	guidance	provided	for	build-to-suit	leases	in	ASC	842.	Accordingly,	these	leases
have	been	reassessed	as	operating	leases	as	of	the	adoption	date	under	ASC	842,	and	are	included	on	the	consolidated	balance	sheet	as	of
December	31,	2019.
Operating	lease	assets	are	included	within	operating	lease	right-of-use	assets,	and	the	corresponding	operating	lease	liabilities	are	included
within	accrued	liabilities	and	other
	
for	the	current	portion,	and	within	other	long-term	liabilities	for	the	long-term	portion	on	our	consolidated	balance
sheet	as	of	December	31,	2019.	Finance	lease	assets	are	included	within	property,	plant	and	equipment,	net,
	
and	the	corresponding	finance	lease
liabilities	are	included	within	current	portion	of	long-term	debt	and	finance	leases
	
for	the	current	portion,	and	within	l
ong-term	debt	and	finance	leases,
net	of	current	portion
	for	the	long-term	portion	on	our	consolidated	balance	sheet	as	of	December	31,	2019.
79


key: chroma:document
string_value:
We	have	elected	not	to	present	short-term	leases	on	the	consolidated	balance	sheet	as	these	leases	have	a	lease	term	of	12	months	or	less	at
lease	inception	and	do	not	contain	purchase	options	or	renewal	terms	that	we	are	reasonably	certain	to	exercise.	All	other	lease	assets	and	lease
liabilities	are	recognized	based	on	the	present	value	of	lease	payments	over	the	lease	term	at	commencement	date.	Because	most	of	our	leases	do	not
provide	an	implicit	rate	of	return,	we	used	our	incremental	borrowing	rate	based	on	the	information	available	at	adoption	date	in	determining	the
present	value	of	lease	payments.
Adoption	of	the	new	lease	standard	on	January	1,	2019	had	a	material	impact	on	our	consolidated	financial	statements.	The	most	significant
impacts	related	to	the	(i)	recognition	of	right-of-use	("ROU")	assets	of	$
1.29
	billion	and	lease	liabilities	of	$
1.24
	billion	for	operating	leases	on	the
consolidated	balance	sheet,	and	(ii)	de-recognition	of	build-to-suit	lease	assets	and	liabilities	of	$
1.62
	billion	and	$
1.74
	billion,	respectively,	with	the	net
impact	of	$
97
	million	recorded	to	accumulated	deficit,	as	of	January	1,	2019.	We	also	reclassified	prepaid	expenses	and	other	current	asset	balances	of
$
142
	million	and	deferred	rent	balance,	including	tenant	improvement	allowances,	and	other	liability	balances	of	$
70
	million	relating	to	our	existing
lease	arrangements	as	of	December	31,	2018,	into	the	ROU	asset	balance	as	of	January	1,	2019.	ROU	assets	represent	our	right	to	use	an	underlying


key: chroma:document
string_value:
asset	for	the	lease	term	and	lease	liabilities	represent	our	obligation	to	make	lease	payments	arising	from	the	lease.	The	standard	did	not	materially
impact	our	consolidated	statement	of	operations	and	consolidated	statement	of	cash	flows.
The	cumulative	effect	of	the	changes	made	to	our	consolidated	balance	sheet	as	of	January	1,	2019	for	the	adoption	of	the	new	lease	standard
was	
as
	follows	(in	millions):
	
	
	
Balances	at
December	31,	2018
	
	
Adjustments
from	Adoption
of	New	Lease
Standard
	
	
Balances	at
January	1,	2019
	
Assets
	
	
	
	
	
	
	
	
	
	
	
	
Prepaid	expenses	and	other	current	assets
	
$
366
	
	
$
—
	
	
$
366
	
Property,	plant	and	equipment,	net
	
	
11,330
	
	
	
(
1,617
)
	
	
9,713
	
Operating	lease	right-of-use	assets
	
	
—
	
	
	
1,286
	
	
	
1,286
	
Other	assets
	
	
572
	
	
	
(
141
)
	
	
431
	
Liabilities
	
	
	
	
	
	
	
	
	
	
	
	
Accrued	liabilities	and	other
	
	
2,094
	
	
	
118
	
	
	
2,212
	
Current	portion	of	long-term	debt	and	finance	leases
	
	
2,568
	
	
	
—
	
	
	
2,568
	
Long-term	debt	and	finance	leases,	net	of	current	portion
	
	
9,404
	
	
	
—
	
	
	
9,404


key: chroma:document
string_value:
—
	
	
	
9,404
	
Other	long-term	liabilities
	
	
2,710
	
	
	
(
687
)
	
	
2,023
	
Equity
	
	
	
	
	
	
	
	
	
	
	
	
Accumulated	deficit
	
	
(
5,318
)
	
	
97
	
	
	
(
5,221
)
	
Research	and	Development	Costs
Research	and	development	costs	are	expensed	as	incurred.
Marketing,	Promotional	and	Advertising	Costs
Marketing,	promotional	and	advertising	costs	are	expensed	as	incurred	and	are	included	as	an	element	of	selling,	general	and	administrative
expense	in	the	consolidated	statement	of	operations.	We	incurred	marketing,	promotional	and	advertising	costs	of	$
27
	million,	$
32
	million	and
$
37
	million	in	the	years	ended	December	31,	2019,	2018	and	2017,	respectively,	of	which	the	majority	is	related	to	promotional	activities.
Income	Taxes
Income	taxes	are	computed	using	the	asset	and	liability	method,	under	which	deferred	tax	assets	and	liabilities	are	determined	based	on	the
difference	between	the	financial	statement	and	tax	bases	of	assets	and	liabilities	using	enacted	tax	rates	in	effect	for	the	year	in	which	the	differences
are	expected	to	affect	taxable	income.	Valuation	allowances	are	established	when	necessary	to	reduce	deferred	tax	assets	to	the	amount	expected	to	be
realized.
80


key: chroma:document
string_value:
We	record	liabilities	related	to	uncertain	tax	positions	when,	despite	our	belief	that	our	tax	return	positions	are	supportable,	we	believe	that	it	is
more	likely	than	not	that	those	positions	may	not	be	fully	sustained	upon	review	by	tax	authorities.	Accrued	interest	and	penalties	related	to
unrecognized	tax	benefits	are	classified	as	income	tax	expense.
		
Comprehensive	Income	(Loss)
Comprehensive	income	(loss)	is	comprised	of	net	income	(loss)	and	other	comprehensive	income	(loss).	Other	comprehensive	
income
	(loss)
consists	of	unrealized	gains	and	losses	on	cash	flow	hedges	and	foreign	currency	translation	adjustments	that	have	been	excluded	from	the
determination	of	net	income	(loss).
Stock-Based	Compensation
We	recognize	compensation	expense	for	costs	related	to	all	share-based	payments,	including	stock	options,	restricted	stock	units	(“RSUs”)	and
our	employee	stock	purchase	plan	(the	“ESPP”).	The	fair	value	of	stock	option	awards	with	only	service	and/or	performance	conditions	and	the	ESPP	is
estimated	on	the	grant	or	offering	date	using	the	Black-Scholes	option-pricing	model.	The	fair	value	of	RSUs	is	measured	on	the	grant	date	based	on	the
closing	fair	market	value	of	our	common	stock.	Stock-based	compensation	expense	is	recognized	on	a	straight-line	basis	over	the	requisite	service
period,	net	of	actual	forfeitures	in	the	period.
For	performance-based	awards,	stock-based	compensation	expense	is	recognized	over	the	expected	performance	achievement	period	of
individual	performance	milestones	when	the	achievement	of	each	individual	performance	milestone	becomes	probable.	For	performance-based	awards
with	a	vesting	schedule	based	entirely	on	the	attainment	of	both	performance	and	market	conditions,	stock-based	compensation	expense	associated


key: chroma:document
string_value:
with	each	tranche	is	recognized	over	the	longer	of	(i)	the	expected	achievement	period	for	the	operational	milestone	for	such	tranche	and	(ii)	the
expected	achievement	period	for	the	related	market	capitalization	milestone	determined	on	the	grant	date,	beginning	at	the	point	in	time	when	the
relevant	operational	milestone	is	considered	probable	of	being	met.	If	such	operational	milestone	becomes	probable	any	time	after	the	grant	date,	we
will	recognize	a	cumulative	catch-up	expense	from	the	grant	date	to	that	point	in	time.	If	the	related	market	capitalization	milestone	is	achieved	earlier
than	its	expected	achievement	period	and	the	achievement	of	the	related	operational	milestone,	then	the	stock-based	compensation	expense	will	be
recognized	over	the	expected	achievement	period	for	the	operational	milestone,	which	may	accelerate	the	rate	at	which	such	expense	is	recognized.
The	fair	value	of	such	awards	is	estimated	on	the	grant	date	using	Monte	Carlo	simulations	(see	Note	
14,
	
Equity	Incentive	Plans
).
As	we	accumulate	additional	employee	stock-based	awards	data	over	time	and	as	we	incorporate	market	data	related	to	our	common	stock,	we
may	calculate	significantly	different	volatilities	and	expected	lives,	which	could	materially	impact	the	valuation	of	our	stock-based	awards	and	the	stock-
based	compensation	expense	that	we	will	recognize	in	future	periods.	Stock-based	compensation	expense	is	recorded	in	cost	of	revenues,	research	and
development	expense	and	selling,	general	and	administrative	expense	in	the	consolidated	statements	of	operations.
81


key: chroma:document
string_value:
the	noncontrolling	interest	and	redeemable	noncontrolling	interest	balances	in	the	consolidated	balance	sheets	between	the	start	and	end	of	each
reporting	period,	after	taking	into	account	any	capital	transactions	between	the	funds	and	the	third-parties.	However,	the	redeemable	noncontrolling
interest	balance	is	at	least	equal	to	the	redemption	amount.	The	redeemable	noncontrolling	interest	balance	is	presented	as	temporary	equity	in	the
mezzanine	section	of	the	consolidated	balance	sheet	since	these	third-parties	have	the	right	to	redeem	their	interests	in	the	funds	for	cash	or	other
assets.
Net	Income	(Loss)	per	Share	of	Common	Stock	Attributable	to	Common	Stockholders
Basic	net	income	(loss)	per	share	of	common	stock	attributable	to	common	stockholders	is	calculated	by	dividing	net	income	(loss)	attributable
to	common	stockholders	by	the	weighted-average	shares	of	common	stock	outstanding	for	the	period.	During	the	year	ended	December	31,	2019,	we
increased	net	loss	attributable	to	common	stockholders	by	$
8
	million	to	arrive	at	the	numerator	used	to	calculate	net	loss	per	share.	This	adjustment
represents	the	difference	between	the	cash	we	paid	to	a	financing	fund	investor	for	their	noncontrolling	interest	in	one	of	our	subsidiaries	and	the
carrying	amount	of	the	noncontrolling	interest	on	our	consolidated	balance	sheet,	in	accordance	with	ASC	260,	
Earnings	per	Share
.	Potentially	dilutive
shares,	which	are	based	on	the	weighted-average	shares	of	common	stock	underlying	outstanding	stock-based	awards,	warrants	and	convertible	senior


key: chroma:document
string_value:
notes	using	the	treasury	stock	method	or	the	if-converted	method,	as	applicable,	are	included	when	calculating	diluted	net	income	(loss)	per	share	of
common	stock	attributable	to	common	stockholders	when	their	effect	is	dilutive.	Since	we	intend	to	settle	or	have	settled	in	cash	the	principal
outstanding	under	our	
0.25
%	Convertible	Senior	Notes	due	in	
2019
,	
1.25
%	Convertible	Senior	Notes	due	in	
2021
,	
2.375
%	Convertible	Senior	Notes	due
in	
2022
,	
2.00
%	Convertible	Senior	Notes	due	in	
2024
	and	
5.50
%	Convertible	Senior	Notes	due	in	
2022
	(assumed	in	our	Maxwell	Technologies,	Inc.
acquisition),	we	use	the	treasury	stock	method	when	calculating	their	potential	dilutive	effect,	if	any.	Furthermore,	in	connection	with	the	offerings	of
our	notes,	we	entered	into	convertible	note	hedges	and	warrants	(see	Note	12,	
Debt
).	However,	our	convertible	note	hedges	are	not	included	when
calculating	potentially	dilutive	shares	since	their	effect	is	always	anti-dilutive.	Warrants	which	have	a	strike	price	above	our	share	price	were	out	of	the
money	and	have	not	been	included	in	the	table	below.
	
The	following	table	presents	the	potentially	dilutive	shares	that	were	excluded	from	the	computation	of	diluted	net	income	(loss)	per	share	of
common	stock	attributable	to	common	stockholders,	because	their	effect	was	anti-dilutive	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Stock-based	awards
	
	
10


key: chroma:document
string_value:
Stock-based	awards
	
	
10
	
	
	
10
	
	
	
10
	
Convertible	senior	notes
	
	
1
	
	
	
1
	
	
	
2
Warrants
	
	
—
	
	
	
—
	
	
	
1
	
	
82


key: chroma:document
string_value:
Business	Combinations
We	account	for	business	acquisitions	under	ASC	805,	
Business	Combinations
.	The	total	purchase	consideration	for	an	acquisition	is	measured	as
the	fair	value	of	the	assets	given,	equity	instruments	issued	and	liabilities	assumed	at	the	acquisition	date.	Costs	that	are	directly	attributable	to	the
acquisition	are	expensed	as	incurred.	Identifiable	assets	(including	intangible	assets),	liabilities	assumed	(including	contingent	liabilities)	and
noncontrolling	interests	in	an	acquisition	are	measured	initially	at	their	fair	values	at	the	acquisition	date.	We	recognize	goodwill	if	the	fair	value	of	the
total	purchase	consideration	and	any	noncontrolling	interests	is	in	excess	of	the	net	fair	value	of	the	identifiable	assets	acquired	and	the	liabilities
assumed.	We	recognize	a	bargain	purchase	gain	within	other	income	(expense),	net,	on	the	consolidated	statement	of	operations	if	the	net	fair	value	of
the	identifiable	assets	acquired	and	the	liabilities	assumed	is	in	excess	of	the	fair	value	of	the	total	purchase	consideration	and	any	noncontrolling
interests.	We	include	the	results	of	operations	of	the	acquired	business	in	the	consolidated	financial	statements	beginning	on	the	acquisition	date.
Cash	and	Cash	Equivalents
All	highly	liquid	investments	with	an	original	maturity	of	three	months	or	less	at	the	date	of	purchase	are	considered	cash	equivalents.	Our	cash
equivalents	are	primarily	comprised	of	money	market	funds.
Restricted	Cash
We	maintain	certain	cash	balances	restricted	as	to	withdrawal	or	use.	Our	restricted	cash	is	comprised	primarily	of	cash	as	collateral	for	our
sales	to	lease	partners	with	a	resale	value	guarantee,	letters	of	credit,	real	estate	leases,	insurance	policies,	credit	card	borrowing	facilities	and	certain


key: chroma:document
string_value:
operating	leases.	In	addition,	restricted	cash	includes	cash	received	from	certain	fund	investors	that	have	not	been	released	for	use	by	us	and	cash	held
to	service	certain	payments	under	various	secured	debt	facilities.
The	following	table	totals	cash	and	cash	equivalents	and	restricted	cash	as	reported	on	the	consolidated	balance	sheets;	the	sums	are	presented
in	the	consolidated	statements	of	cash	flows	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
	
2016
	
Cash	and	cash	equivalents
	
$
6,268
	
	
$
3,686
	
	
$
3,368
	
	
$
3,393
	
Restricted	cash,	current	portion
	
	
246
	
	
	
193
	
	
	
155
	
	
	
106
	
Restricted	cash,	net	of	current	portion
	
	
269
	
	
	
398
	
	
	
442
	
	
	
268
	
Total	as	presented	in	the	consolidated
statements	of	cash	flows
	
$
6,783
	
	
$
4,277
	
	
$
3,965
	
	
$
3,767
	
Accounts	Receivable	and	Allowance	for	Doubtful
	
Accounts
Accounts	receivable	primarily	include	amounts	related	to	receivables	from	financial	institutions	and	leasing	companies	offering	various
financing	products	to	our	customers,	sales	of	energy	generation	and	storage	products,	sales	of	regulatory	credits	to	other	automotive	manufacturers


key: chroma:document
string_value:
and	maintenance	services	on	vehicles	owned	by	leasing	companies.	We	provide	an	allowance	against	accounts	receivable	to	the	amount	we	reasonably
believe	will	be	collected.	We	write-off	accounts	receivable	when	they	are	deemed	uncollectible.
We	typically	do	not	carry	significant	accounts	receivable	related	to	our	vehicle	and	related	sales	as	customer	payments	are	due	prior	to	vehicle
delivery,	except	for	amounts	due	from	commercial	financial	institutions	for	approved	financing	arrangements	between	our	customers	and	the	financial
institutions.
83


key: chroma:document
string_value:
MyPower	Customer	Notes	Receivable
We	have	customer	notes	receivable	under	the	legacy	MyPower	loan	program.	MyPower	was	offered	by	SolarCity	to	provide	residential
customers	with	the	option	to	finance	the	purchase	of	a	solar	energy	system	through	a	
30
-year	loan.	The	outstanding	balances,	net	of	any	allowance	for
potentially	uncollectible	amounts,	are	presented	on	the	consolidated	balance	sheet	as	a	component	of	prepaid	expenses	and	other	current	assets	for	the
current	portion	and	as	MyPower	customer	notes	receivable,	net	of	current	portion,	for	the	long-term	portion.	In	determining	the	allowance	and	credit
quality	for	customer	notes	receivable,	we	identify	significant	customers	with	known	disputes	or	collection	issues	and	also	consider	our	historical	level	of
credit	losses	and	current	economic	trends	that	might	impact	the	level	of	future	credit	losses.	Customer	notes	receivable	that	are	individually	impaired
are	charged-off	as	a	write-off	of	the	allowance	for	losses.	Since	acquisition,	there	have	been	
no
	new	significant	customers	with	known	disputes	or
collection	issues,	and	the	amount	of	potentially	uncollectible	amounts	has	been	insignificant.	In	addition,	there	were	
no
	material	non-accrual	or	past	due
customer	notes	receivable	as	of	December	31,	2019.
Concentration	of	Risk
Credit	Risk
Financial	instruments	that	potentially	subject	us	to	a	concentration	of	credit	risk	consist	of	cash,	cash	equivalents,	restricted	cash,	accounts
receivable,	convertible	note	hedges,	and	interest	rate	swaps.	Our	cash	balances	are	primarily	invested	in	money	market	funds	or	on	deposit	at	high


key: chroma:document
string_value:
credit	quality	financial	institutions	in	the	U.S.	These	deposits	are	typically	in	excess	of	insured	limits.	As	of	December	31,	2019	and	2018,	
no
	entity
represented	
10
%	or	more	of	our	total	accounts	receivable	balance	.	The	risk	of	concentration	for	our	interest	rate	swaps	is	mitigated	by	transacting	with
several	highly-rated	multinational	banks.
Supply	Risk
We	are	dependent	on	our	suppliers,	the	majority	of	which	are	single	source	suppliers,	and	the	inability	of	these	suppliers	to	deliver	necessary
components	of	our	products	in	a	timely	manner	at	prices,	quality	levels	and	volumes	acceptable	to	us,	or	our	inability	to	efficiently	manage	these
components	from	these	suppliers,	could	have	a	material	adverse	effect	on	our	business,	prospects,	financial	condition	and	operating	results.
Inventory	Valuation
Inventories	are	stated	at	the	lower	of	cost	or	net	realizable	value.	Cost	is	computed	using	standard	cost	for	vehicles	and	energy	storage
products,	which	approximates	actual	cost	on	a	first-in,	first-out	basis.	In	addition,	cost	for	solar	energy	systems	is	recorded	using	actual	cost.	We	record
inventory	write-downs	for	excess	or	obsolete	inventories	based	upon	assumptions	about	current	and	future	demand	forecasts.	If	our	inventory	on-hand
is	in	excess	of	our	future	demand	forecast,	the	excess	amounts	are	written-off.
We	also	review	our	inventory	to	determine	whether	its	carrying	value	exceeds	the	net	amount	realizable	upon	the	ultimate	sale	of	the	inventory.
This	requires	us	to	determine	the	estimated	selling	price	of	our	vehicles	less	the	estimated	cost	to	convert	the	inventory	on-hand	into	a	finished	product.


key: chroma:document
string_value:
Once	inventory	is	written-down,	a	new,	lower	cost	basis	for	that	inventory	is	established	and	subsequent	changes	in	facts	and	circumstances	do	not
result	in	the	restoration	or	increase	in	that	newly	established	cost	basis.
Should	our	estimates	of	future	selling	prices	or	production	costs	change,	additional	and	potentially	material	increases	to	this	reserve	may	be
required.	A	small	change	in	our	estimates	may	result	in	a	material	charge	to	our	reported	financial	results.
84


key: chroma:document
string_value:
Operating	Lease	Vehicles
Vehicles	that	are	leased	as	part	of	our	direct	vehicle	leasing	program,	vehicles	delivered	to	leasing	partners	with	a	resale	value	guarantee	and	a
buyback	option,	and	vehicles	delivered	to	customers	with	resale	value	guarantee	where	exercise	is	probable	are	classified	as	operating	lease	vehicles	as
the	related	revenue	transactions	are	treated	as	operating	leases	under	ASC	842	(
refer	to	the	
Automotive	Leasing	Revenue	
section	above	for	details
).
Operating	lease	vehicles	are	recorded	at	cost	less	accumulated	depreciation.	We	generally	depreciate	their	value,	less	salvage	value,	using	the	straight-
line-method	to	cost	of	automotive	leasing	revenue	over	the	contractual	period.	The	total	cost	of	operating	lease	vehicles	recorded	on	the	consolidated
balance	sheets	as	of	December	31,	2019	and	2018	was	$
2.85
	billion	and	$
2.55
	billion,	respectively.	Accumulated	depreciation	related	to	leased	vehicles
as	of	December	31,	2019	and	2018	was	$
406
	million	and	$
458
	million,	respectively.
Solar	Energy	Systems,	Net
We	are	the	lessor	of	solar	energy	systems.	Prior	to	January	1,	2019,	these	leases	
were	accounted	for	as	operating	leases	in	accordance	with
ASC	840.	Under	ASC	840,	to	determine	lease	classification,	we	evaluated	the	lease	terms	to	determine	whether	there	was	a	transfer	of	ownership	or
bargain	purchase	option	at	the	end	of	the	lease,	whether	the	lease	term	was	greater	than	
75
%	of	the	useful	life	or	whether	the	present	value	of	the
minimum	lease	payments	exceeded	
90
%	of	the	fair	value	at	lease	inception.	As	discussed	in	the


key: chroma:document
string_value:
Leases
	section	above,
	agreements	for	solar	energy
system	leases	and	PPAs	that	commence	after	January	1,	2019	no	longer	meet	the	definition	of	a	lease	upon	the	adoption	of	ASC	842	and	are	instead
accounted	for	in	accordance	with	the	new	revenue	standard.	We	utilize	periodic	appraisals	to	estimate	useful	lives	and	fair	values	at	lease	inception	and
residual	values	at	lease	termination.	Solar	energy	systems	are	stated	at	cost	less	accumulated	depreciation.
Depreciation	and	amortization	is	calculated	using	the	straight-line	method	over	the	estimated	useful	lives	of	the	respective	assets,	as	follows:
	
Solar	energy	systems	in	service
	
	
	
30
	to	
35
	years
Initial	direct	costs	related	to	customer
			solar	energy	system	lease	acquisition
			costs
	
	
	
Lease	term	(up	to
25	years)
	
Solar	energy	systems	pending	interconnection	will	be	depreciated	as	solar	energy	systems	in	service	when	they	have	been	interconnected	and
placed	in-service.	Solar	energy	systems	under	construction	represents	systems	that	are	under	installation,	which	will	be	depreciated	as	solar	energy
systems	in	service	when	they	are	completed,	interconnected	and	placed	in	service.	Initial	direct	costs	related	to	customer	solar	energy	system
agreement	acquisition	costs	are	capitalized	and	amortized	over	the	term	of	the	related	customer	agreements.
Property,	Plant	and	Equipment,	net
Property,	plant	and	equipment,	net,	including	leasehold	improvements,	are	recognized	at	cost	less	accumulated	depreciation.	
Depreciation	is
generally	computed	using	the	straight-line	method	over	the	estimated	useful	lives	of	the	respective	assets,	as	follows:
	
Machinery,	equipment,	vehicles	and
			office	furniture


key: chroma:document
string_value:
office	furniture
	
	
	
2
	to	
12
	years
Building	and	building	improvements
	
	
	
15
	to	
30
	years
Computer	equipment	and	software
	
	
	
3
	to	
10
	years
Leasehold	improvements	are	depreciated	on	a	straight-line	basis	over	the	shorter	of	their	estimated	useful	lives	or	the	terms	of	the	related
leases.
Upon	the	retirement	or	sale	of	our	property,	plant	and	equipment,	the	cost	and	associated	accumulated	depreciation	are	removed	from	the
consolidated	balance	sheet,	and	the	resulting	gain	or	loss	is	reflected	on	the	consolidated	statement	of	operations.	Maintenance	and	repair	expenditures
are	expensed	as	incurred	while	major	improvements	that	increase	the	functionality,	output	or	expected	life	of	an	asset	are	capitalized	and	depreciated
ratably	over	the	identified	useful	life.
85


key: chroma:document
string_value:
Interest	expense	on	outstanding	debt	is	capitalized	during	the	period	of	significant	capital	asset	construction.	Capitalized	interest	on
construction-in-progress	is	included	within	property,	plant	and	equipment	and	is	amortized	over	the	life	of	the	related	assets.
Prior	to	the	adoption	of	the	new	lease	standard,	we	were	deemed	to	be	the	owner,	for	accounting	purposes,	during	the	construction	phase	of
certain	long-lived	assets	under	build-to-suit	lease	arrangements	because	of	our	involvement	with	the	construction,	our	exposure	to	any	potential	cost
overruns	or	our	other	commitments	under	the	arrangements.	In	accordance	with	ASC	840,	we	recognized	build-to-suit	lease	assets	under	construction
and	corresponding	build-to-suit	lease	liabilities	on	the	consolidated	balance	sheet.	Once	construction	was	completed,	if	a	lease	met	certain	“sale-
leaseback”	criteria,	we	removed	the	asset	and	liability	and	accounted	for	the	lease	as	an	operating	lease.	Otherwise,	the	lease	was	accounted	for	as	a
capital	lease.	
As	a	result	of	the	adoption	of	the	new	lease	standard	on	January	1,	2019,	we	have	de-recognized	all	build-to-suit	lease	assets	and	have
reassessed	these	leases	to	be	operating	lease	right-of-use	assets	within	the	consolidated	balance	sheet	as	of	December	31,	2019	(refer	to	
Leases
	section
above	for	details).
Long-Lived	Assets	Including	Acquired	Intangible	Assets
We	review	our	property,	plant	and	equipment,	long-term	prepayments	and	intangible	assets	for	impairment	whenever	events	or	changes	in
circumstances	indicate	that	the	carrying	amount	of	an	asset	(or	asset	group)	may	not	be	recoverable.	We	measure	recoverability	by	comparing	the


key: chroma:document
string_value:
carrying	amount	to	the	future	undiscounted	cash	flows	that	the	asset	is	expected	to	generate.	If	the	asset	is	not	recoverable,	its	carrying	amount	would
be	adjusted-down	to	its	fair	value.	For	the	years	ended	December	31,	2019	and	2018,	we	have	recognized	certain	impairments	of	our	long-lived	assets
(refer	to	Note	4,
	Goodwill	and	Intangible	Assets
	and	Note	22,	
Restructuring	and	Other
,	for	further	details).	For	the	year	ended	December	31,	2017,	we
have	recognized	no	material	impairments	of	our	long-lived	assets.
Intangible	assets	with	definite	lives	are	amortized	on	a	straight-line	basis	over	their	estimated	useful	lives,	which	range	from	
one	to	thirty	years
.
Goodwill
We	assess	goodwill	for	impairment	annually	in	the	fourth	quarter,	or	more	frequently	if	events	or	changes	in	circumstances	indicate	that	it
might	be	impaired,	by	comparing	its	carrying	value	to	the	reporting	unit’s	fair	value.	For	the	years	ended	December	31,	2019,	2018,	and	2017,	we	had
no
t	recognized	any	impairment	of	goodwill.
Capitalization	of	Software	Costs
For	costs	incurred	in	development	of	internal	use	software,	we	capitalize	costs	incurred	during	the	application	development	stage.	Costs	related
to	preliminary	project	activities	and	post-implementation	activities	are	expensed	as	incurred.	Internal	use	software	is	amortized	on	a	straight-line	basis
over	its	estimated	useful	life	of	three	to	ten	years.	We	evaluate	the	useful	lives	of	these	assets	on	an	annual	basis,	and	we	test	for	impairment	whenever


key: chroma:document
string_value:
events	or	changes	in	circumstances	occur	that	could	impact	the	recoverability	of	these	assets.
Foreign	Currency
We	determine	the	functional	and	reporting	currency	of	each	of	our	international	subsidiaries	and	their	operating	divisions	based	on	the	primary
currency	in	which	they	operate.	In	cases	where	the	functional	currency	is	not	the	U.S.	dollar,	we	recognize	a	cumulative	translation	adjustment	created
by	the	different	rates	we	apply	to	accumulated	deficits,	including	current	period	income	or	loss	and	the	balance	sheet.	For	each	subsidiary,	we	apply	the
monthly	average	functional	exchange	rate	to	its	monthly	income	or	loss	and	the	month-end	functional	currency	rate	to	translate	the	balance	sheet.
Foreign	currency	transaction	gains	and	losses	are	a	result	of	the	effect	of	exchange	rate	changes	on	transactions	denominated	in	currencies
other	than	the	functional	currency.	Transaction	gains	and	losses	are	recognized	in	other	income	(expense),	net,	in	the	consolidated	statements	of
operations.	For	the	years	ended	December	31,	2019,	2018	and	2017,	we	recorded	foreign	currency	transaction	gains	of	$
48
	million,	gains	of	$
2
	million
and	losses	of	$
52
	million,	respectively.
86


key: chroma:document
string_value:
Warranties
We	provide	a	manufacturer’s	warranty	on	all	new	and	used	vehicles	and	production	powertrain	components	and	systems	we	sell.	In	addition,	
we
also	provide	a	warranty	on	the	installation	and	components	of	the	energy	generation	and	storage	systems	we	sell	for	periods	typically	between	10	to
25	years.
	We	accrue	a	warranty	reserve	for	the	products	sold	by	us,	which	includes	our	best	estimate	of	the	projected	costs	to	repair	or	replace	items
under	warranties	and	recalls	when	identified.	These	estimates	are	based	on	actual	claims	incurred	to	date	and	an	estimate	of	the	nature,	frequency	and
costs	of	future	claims.	These	estimates	are	inherently	uncertain	given	our	relatively	short	history	of	sales,	and	changes	to	our	historical	or	projected
warranty	experience	may	cause	material	changes	to	the	warranty	reserve	in	the	future.	The	warranty	reserve	does	not	include	projected	warranty	costs
associated	with	our	vehicles	subject	to	lease	accounting	and	our	solar	energy	systems	under	lease	contracts	or	PPAs,	as	the	costs	to	repair	these
warranty	claims	are	expensed	as	incurred.	The	portion	of	the	warranty	reserve	expected	to	be	incurred	within	the	next	12	months	is	included	within
accrued	liabilities	and	other,	while	the	remaining	balance	is	included	within	other	long-term	liabilities	on	the	consolidated	balance	sheets.	Warranty
expense	is	recorded	as	a	component	of	cost	of	revenues	in	the	consolidated	statements	of	operations.	Due	to	the	magnitude	of	our	automotive	business,
accrued	warranty	balance	as	of	December	31,	2019	was	primarily	related	to	our	automotive	segment.	Accrued	warranty	activity	consisted	of	the
following	(in	millions):	
	
	
	
Year	Ended	December	31,


key: chroma:document
string_value:
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Accrued	warranty—beginning	of	period
	
$
748
	
	
$
402
	
	
$
267
	
Assumed	warranty	liability	from	acquisition
	
	
—
	
	
	
—
	
	
	
5
	
Warranty	costs	incurred
	
	
(
250
)
	
	
(
209
)
	
	
(
123
)
Net	changes	in	liability	for	pre-existing	warranties,	including
			expirations	and	foreign	exchange	impact
	
	
36
	
	
	
(
26
)
	
	
4
	
Additional	warranty	accrued	from	adoption	of	the	new	revenue
			standard
	
	
—
	
	
	
37
	
	
	
—
	
Provision	for	warranty
	
	
555
	
	
	
544
	
	
	
249
	
Accrued	warranty—end	of	period
	
$
1,089
	
	
$
748
	
	
$
402
	
For	the	years	ended	December	31,	2019	and	2018	,	and	2017,	warranty	costs	incurred	for	vehicles	accounted	for	as	operating	leases
were	$
20
	million,	$
22
	million	and	$
36
	million,	respectively	.		
Solar	Renewable	Energy	Credits
We	account	for	solar	renewable	energy	credits	(“SRECs”)	when	they	are	purchased	by	us	or	sold	to	third-parties.	For	SRECs	generated	by	solar
energy	systems	owned	by	us	and	minted	by	government	agencies,	we	do	not	recognize	any	specifically	identifiable	costs	as	there	are	no	specific


key: chroma:document
string_value:
incremental	costs	incurred	to	generate	the	SRECs.	We	recognize	revenue	within	the	energy	generation	and	storage	segment	from	the	sale	of	an	SREC
when	the	SREC	is	transferred	to	the	buyer,	and	the	cost	of	the	SREC,	if	any,	is	then	recorded	to	energy	generation	and	storage	cost	of	revenue.
Deferred	Investment	Tax	Credit	Revenue
We	have	solar	energy	systems	that	are	eligible	for	ITCs	that	accrue	to	eligible	property	under	the	Internal	Revenue	Code	(“IRC”).	Under
Section	50(d)(5)	of	the	IRC	and	the	related	regulations,	a	lessor	of	qualifying	property	may	elect	to	treat	the	lessee	as	the	owner	of	such	property	for	the
purposes	of	claiming	the	ITCs	associated	with	such	property.	These	regulations	enable	the	ITCs	to	be	separated	from	the	ownership	of	the	property	and
allow	the	transfer	of	the	ITCs.	Under	our	lease	pass-through	fund	arrangements,	we	can	make	a	tax	election	to	pass-through	the	ITCs	to	the	investors,
who	are	the	legal	lessee	of	the	property.	Therefore,	we	are	able	to	monetize	these	ITCs	to	the	investors	who	can	utilize	them	in	return	for	cash
payments.	We	consider	the	monetization	of	ITCs	to	constitute	one	of	the	key	elements	of	realizing	the	value	associated	with	solar	energy	systems.
Consequently,	we	consider	the	proceeds	from	the	monetization	of	ITCs	to	be	a	component	of	revenue	generated	from	solar	energy	systems.
87


key: chroma:document
string_value:
Under	the	new	revenue	standard,	we	
recognize	revenue	upon	the	delivery	of	ITCs	to	investors	under	our	lease	pass-through	fund	arrangements
as	this	is	the	point	in	time	that	control	of	ITCs	has	transferred
.
We	indemnify	the	investors	for	any	recapture	of	ITCs	due	to	our	non-compliance.	We	have	concluded	that	the	likelihood	of	a	recapture	event	is
remote,	and	consequently,	we	have	not	recognized	a	liability	for	this	indemnification	on	the	consolidated	balance	sheets.
Nevada	Tax	Incentives
We	had	entered	into	agreements	with	the	State	of	Nevada	and	Storey	County	in	Nevada	that	provide	abatements	for	sales,	use,	real	property,
personal	property	and	employer	excise	taxes,	discounts	to	the	base	tariff	energy	rates	and	transferable	tax	credits.	These	incentives	are	available	for
the	applicable	periods	beginning	on	
October	17,	2014
	and	ending	on	either	
June	30,	2024
	or	June	30,	2034	(depending	on	the	incentive).	Under	these
agreements,	we	were	eligible	for	a	maximum	of	$
195
	million	of	transferable	tax	credits,	subject	to	capital	investments	by	us	and	our	partners	for
Gigafactory	Nevada	of	at	least	$
3.50
	billion,	which	we	exceeded	during	2017,	and	specified	hiring	targets	for	Gigafactory	Nevada,	which	we	exceeded
during	2018.	We	recorded	these	credits	as	earned	when	we	had	evidence	there	was	a	market	for	their	sale.	Credits	were	applied	as	a	cost	offset	to
either	employee	expense	or	to	capital	assets,	depending	on	the	source	of	the	credits.	Credits	earned	from	employee	hires	or	capital	spending	by	our


key: chroma:document
string_value:
partners	at	Gigafactory	Nevada	were	recorded	as	a	reduction	to	operating	expenses.	As	of	December	31,	2019	and	2018,	we	had	earned	the	maximum
of	$
195
	million	of	transferable	tax	credits	under	these	agreements.
Recent	Accounting	Pronouncements
Recently	issued	accounting	pronouncements	not	yet	adopted
In	June	2016,	the	FASB	issued	ASU	No.	2016-13,	Measurement	of	Credit	Losses	on	Financial	Instruments,	to	require	financial	assets	carried	at
amortized	cost	to	be	presented	at	the	net	amount	expected	to	be	collected	based	on	historical	experience,	current	conditions	and	forecasts.
Subsequently,	the	FASB	issued	ASU	No.	2018-19,	Codification	Improvements	to	Topic	326,	to	clarify	that	receivables	arising	from	operating	leases	are
within	the	scope	of	lease	accounting	standards.	Further,	the	FASB	issued	ASU	No.	2019-04,	ASU	No.	2019-05,	ASU	2019-10	and	ASU	2019-11	to
provide	additional	guidance	on	the	credit	losses	standard.	The	ASUs	are	effective	for	interim	and	annual	periods	beginning	after	December	15,	2019,
with	early	adoption	permitted.	Adoption	of	the	ASUs	is	on	a	modified	retrospective	basis.	We	plan	to	adopt	the	ASUs	on	January	1,	2020.	The	ASUs	are
currently	not	expected	to	have	a	material	impact	on	our	consolidated	financial	statements.
In	January	2017,	the	FASB	issued	ASU	No.	2017-04,	Simplifying	the	Test	for	Goodwill	Impairment,	to	simplify	the	test	for	goodwill	impairment


key: chroma:document
string_value:
by	removing	Step	2.	An	entity	will,	therefore,	perform	the	goodwill	impairment	test	by	comparing	the	fair	value	of	a	reporting	unit	with	its	carrying
amount	and	recognizing	an	impairment	charge	for	the	amount	by	which	the	carrying	amount	exceeds	the	fair	value,	not	to	exceed	the	total	amount	of
goodwill	allocated	to	the	reporting	unit.	An	entity	still	has	the	option	to	perform	a	qualitative	assessment	to	determine	if	the	quantitative	impairment
test	is	necessary.	The	ASU	is	effective	for	interim	and	annual	periods	beginning	after	December	15,	2019,	with	early	adoption	permitted.	Adoption	of
the	ASU	is	prospective.	We	plan	to	adopt	the	ASU	prospectively	on	January	1,	2020.	The	ASU	is	currently	not	expected	to	have	a	material	impact	on	our
consolidated	financial	statements.
In	August	2018,	the	FASB	issued	ASU	No.	2018-15,	Customer’s	Accounting	for	Implementation	Costs	Incurred	in	a	Cloud	Computing
Arrangement	that	Is	a	Service	Contract.	The	ASU	aligns	the	requirements	for	capitalizing	implementation	costs	incurred	in	a	hosting	arrangement	that
is	a	service	contract	with	the	requirements	for	capitalizing	implementation	costs	incurred	to	develop	or	obtain	internal-use	software	(and	hosting
arrangements	that	include	an	internal-use	software	license).	The	ASU	is	effective	for	interim	and	annual	periods	beginning	after	December	15,	2019,
with	early	adoption	permitted.	Adoption	of	the	ASU	is	either	retrospective	or	prospective.	We	plan	to	adopt	the	ASU	prospectively	on	January	1,	2020.
The	ASU	is	currently	not	expected	to	have	a	material	impact	on	our	consolidated	financial	statements.
88


key: chroma:document
string_value:
In	December	2019,	the	FASB	issued	ASU	No.	2019-12,	Simplifying	the	Accounting	for	Income	Taxes,	as	part	of	its	initiative	to	reduce
complexity	in	accounting	standards.	The	amendments	in	the	ASU	are	effective	for	fiscal	years	beginning	after	December	15,	2020,	including	interim
periods	therein.	Early	adoption	of	the	standard	is	permitted,	including	adoption	in	interim	or	annual	periods	for	which	financial	statements	have	not	yet
been	issued.	We	have	not	early	adopted	this	ASU	for	2019.		The	ASU	is	currently	not	expected	to	have	a	material	impact	on	our	consolidated	financial
statements.
Recently	adopted	accounting	pronouncements
In	February	2016,	the	FASB	issued	ASU	No.	2016-02,	Leases,	to	require	lessees	to	recognize	all	leases,	with	limited	exceptions,	on	the	balance	sheet,
while	recognition	on	the	statement	of	operations	will	remain	similar	to	legacy	lease	accounting,	ASC	840.	The	ASU	also	eliminates	real	estate-specific
provisions	and	modifies	certain	aspects	of	lessor	accounting.	Subsequently,	the	FASB	issued	ASU	No.	2018-10
,	Codification	Improvements	to	Topic	842
,	ASU
No.	2018-11,	
Targeted	Improvements
,
	
ASU	No.	2018-20,
	Narrow-Scope	Improvements	for	Lessors
,	and	ASU	2019-01,	
Codification	Improvements
,	to	clarify
and	amend	the	guidance	in	ASU	No.	2016-02.	We	adopted	the	ASUs	on	January	1,	2019	on	a	modified	retrospective	basis	through	a	cumulative	adjustment	to


key: chroma:document
string_value:
our	beginning	accumulated	deficit	balance.	Prior	comparative	periods	have	not	been	recast	under	this	method,	and	we	adopted	all	available	practical
expedients,	as	applicable.	Further,	solar	leases	that	commence	on	or	after	January	1,	2019,	where	we	are	the	lessor	and	which	were	accounted	for	as	leases
under	ASC	840,	will	no	longer	meet	the	definition	of	a	lease.	Instead,	solar	leases	commencing	on	or	after	January	1,	2019	will	be	accounted	for	under	the	new
revenue	standard.	In	addition	to	recognizing	operating	leases	that	were	previously	not	recognized	on	the	consolidated	balance	sheet,	our	build-to-suit	leases
were	also	de-recognized	with	a	net	decrease	of	approximately	$
97
	million	to	our	beginning	accumulated	deficit	after	income	tax	effects,	as	our	build-to-suit
leases	no	longer	qualify	for	build-to-suit	accounting	and	are	instead	recognized	as	operating	leases.	Upon	adoption,	our	consolidated	balance	sheet	include	an
overall	reduction	in	assets	of	$
473
	million	and	a	reduction	in	liabilities	of	$
570
	million.	The	adoption	of	the	ASUs	did	not	have	a	material	impact	on	the
consolidated	statement	of	operations	or	the	consolidated	statement	of	cash	flows.
In	August	2017,	the	FASB	issued	ASU	No.	2017-12,	
Targeted	Improvements	to	Accounting	for	Hedging	Activities
,	to	simplify	the	application	of
current	hedge	accounting	guidance.	The	ASU	expands	and	refines	hedge	accounting	for	both	non-financial	and	financial	risk	components	and	aligns	the
recognition	and	presentation	of	the	effects	of	the	hedging	instrument	and	the	hedged	item	in	the	financial	statements.	We	adopted	the	ASU


key: chroma:document
string_value:
prospectively	on	January	1,	2019,	and	the	ASU	did	not	have	a	material	impact	on	the	consolidated	financial	statements.
In	January	2018,	the	FASB	issued	ASU	No.	2018-01,	
Land	Easement	Practical	Expedient	Transition	to	Topic	842
,	to	permit	an	entity	to	elect	a
practical	expedient	to	not	re-evaluate	land	easements	that	existed	or	expired	before	the	entity’s	adoption	of	ASU	No.	2016-02,	
Leases
,	and	that	were	not
accounted	for	as	leases.	The	ASU	did	not	have	a	material	impact	on	the	consolidated	financial	statements.
	
	
Note	3	–	Business	Combinations
Maxwell	Acquisition
On	
May	16,	2019
	(the	“Acquisition	Date”),	we	completed	our	strategic	acquisition	of	Maxwell	Technologies,	Inc.	(“Maxwell”),	an	energy	storage
and	power	delivery	products	company,	for	its	complementary	technology	and	workforce.	Pursuant	to	the	related	Agreement	and	Plan	of	Merger	(the
“Merger	Agreement”),	
each	issued	and	outstanding	share	of	Maxwell	common	stock	was	converted	into	
0.0193
	(the	“Exchange	Ratio”)	shares	of	our
common	stock.
	In	addition,	Maxwell’s	stock	option	awards	and	restricted	stock	unit	awards	were	assumed	by	us	and	converted	into	corresponding
equity	awards	in	respect	of	our	common	stock	based	on	the	Exchange	Ratio,	with	the	awards	retaining	the	same	vesting	and	other	terms	and	conditions
as	in	effect	immediately	prior	to	the	acquisition.
Fair	Value	of	Purchase	Consideration
The	Acquisition	Date	fair	value	of	the	purchase	consideration	was	$
207
	million	(
902,968
	shares	issued	at	$
229.49


key: chroma:document
string_value:
902,968
	shares	issued	at	$
229.49
	per	share,	the	opening	price
of	our	common	stock	on	the	Acquisition	Date).
89


key: chroma:document
string_value:
Fair	Value	of	Assets	Acquired	and	Liabilities	Assumed
	
We	accounted	for	the	acquisition	using	the	purchase	method	of	accounting	for	business	combinations	under	ASC	805,	
Business	Combinations
.
The	total	purchase	price	is	allocated	to	the	tangible	and	identifiable	intangible	assets	acquired	and	liabilities	based	on	their	estimated	fair	values	as	of
the	Acquisition	Date.		
Fair	value	estimates	are	based	on	a	complex	series	of	judgments	about	future	events	and	uncertainties	and	rely	heavily	on	estimates	and
assumptions.	The	judgments	used	to	determine	the	estimated	fair	value	assigned	to	each	class	of	assets	acquired	and	liabilities	assumed,	as	well	as
asset	lives	and	the	expected	future	cash	flows	and	related	discount	rates,	can	materially	impact	our	consolidated	financial	statements.	Significant	inputs
used	for	the	model	included	the	amount	of	cash	flows,	the	expected	period	of	the	cash	flows	and	the	discount	rates.	In	2019,	we	finalized	our	estimate	of
the	Acquisition	Date	fair	values	of	the	assets	acquired	and	the	liabilities	assumed	and	there	were	no	changes	to	the	fair	values	of	the	assets	acquired
and	the	liabilities	assumed.		
The	allocation	of	the	purchase	price	is	based	on	management’s	estimate	of	the	Acquisition	Date	fair	values	of	the	assets	acquired	and	liabilities
assumed,	as	follows	(in	millions):
	
Assets	acquired:
	
	
	
	
Cash	and	cash	equivalents
	
$
32
	
Accounts	receivable
	
	
24
	
Inventory
	
	
32
	
Property,	plant	and	equipment,	net
	
	
27
	
Operating	lease	right-of-use	assets
	
	
10
	
Intangible	assets
	
	
105
	
Prepaid	expenses	and	other	assets,	current	and	non-current
	
	
3


key: chroma:document
string_value:
3
	
Total	assets	acquired
	
	
233
	
Liabilities	and	equity	assumed:
	
	
	
	
Accounts	payable
	
	
(
10
)
Accrued	liabilities	and	other
	
	
(
28
)
Debt	and	finance	leases,	current	and	non-current
	
	
(
44
)
Deferred	revenue,	current
	
	
(
1
)
Other	long-term	liabilities
	
	
(
14
)
Additional	paid-in	capital
	
	
(
8
)
Total	liabilities	and	equity	assumed
	
	
(
105
)
Net	assets	acquired
	
	
128
	
Goodwill
	
	
79
	
Total	purchase	price
	
$
207
	
	
Goodwill	represented	the	excess	of	the	purchase	price	over	the	fair	value	of	the	net	assets	acquired	and	was	primarily	attributable	to	the
expected	synergies	from	integrating	Maxwell’s	technology	into	our	automotive	segment	as	well	as	the	acquired	talent.	Goodwill	is	not	deductible	for
U.S.	income	tax	purposes	and	is	not	amortized.
Identifiable	Intangible	Assets	Acquired
The	determination	
of	the	fair	value	of	identified	intangible	assets	and	their	respective	useful	lives	are	as	follows	(in	millions,	except	for
estimated	useful	life):
	
	
	
Fair	Value
	
	
Useful	Life
(in	years)
	
Developed	technology
	
$
102
	
	
	
9
	
Customer	relations
	
	
2
	
	
	
9
	
Trade	name
	
	
1
	
	
	
10
	
Total	intangible	assets
	
$
105
	
	
	
	
	
	
90


key: chroma:document
string_value:
Maxwell’s	results	of	operations	since	the	Acquisition	Date	have	been	included	within	the	automotive	segment.	Standalone	and	pro	forma	results
of	operations	have	not	been	presented	because	they	were	not	material	to	the	consolidated	financial	statements.
Other	Acquisitions
During	the	year	ended	December	31,	2019,	
we	completed	various	other	acquisitions	generally	for	the	related	technology	and	workforce.	Total
consideration	for	these	acquisitions	was	$
96
	million,	of	which	$
80
	million	was	paid	in	cash.	In	aggregate,	$
36
	million	was	attributed	to	intangible	assets,
$
51
	million	was	attributed	to	goodwill	within	the	automotive	segment,	and	$
9
	million	was	attributed	to	net	assets	assumed.	Goodwill	is	not	deductible
for	U.S.	income	tax	purposes.	The	identifiable	intangible	assets	were	related	to	purchased	technology,	with	estimated	useful	lives	of	
one
	to	
nine
	years
.
Standalone	and	pro	forma	results	of	operations	have	not	been	presented	because	they	were	not	material	to	the	consolidated	financial
statements,	either	individually	or	in	aggregate.
	
Note	4	–	Goodwill	and	Intangible	Assets
Goodwill	increased	$
130
	million	from	$
68
	million	as	of	December	31,	2018	to	$
198
	million	as	of	December	31,	2019	primarily	due	to	completed
business	combinations	during	the	year	ended	December	31,	2019	(see	Note	3,	
Business	Combinations
).	There	were	
no
	accumulated	impairment	losses
as	of	December	31,	2019	and	2018.
Information	regarding	our	intangible	assets	
including	assets	recognized	from	our	acquisitions	
was	as	follows	(in	millions):


key: chroma:document
string_value:
was	as	follows	(in	millions):
	
	
	
December	31,	2019
	
	
December	31,	2018
	
	
	
Gross	Carrying
Amount
	
	
Accumulated
Amortization
	
	
Other
	
	
Net	Carrying
Amount
	
	
Gross	Carrying
Amount
	
	
Accumulated
Amortization
	
	
Other
	
	
Net	Carrying
Amount
	
Finite-lived
			intangible	assets:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Developed	technology
	
$
291
	
	
$
(
72
)
	
$
1
	
	
$
220
	
	
$
152
	
	
$
(
40
)
	
$
1
	
	
$
113
	
Trade	names
	
	
3
	
	
	
(
1
)
	
	
1
	
	
	
3
	
	
	
45
	
	
	
(
44
)
	
	
—
	
	
	
1
	
Favorable	contracts	and
			leases,	net
	
	
113
	
	
	
(
24
)
	
	
—
	
	
	
89
	
	
	
113
	
	
	
(
17
)
	
	
—
	
	
	
96
	
Other
	
	
38
	
	
	
(
16
)
	
	
—
	
	
	
22
	
	
	
36
	
	
	
(
12
)
	
	
1
	
	
	
25
	
Total	finite-lived
			intangible	assets
	
	
445


key: chroma:document
string_value:
intangible	assets
	
	
445
	
	
	
(
113
)
	
	
2
	
	
	
334
	
	
	
346
	
	
	
(
113
)
	
	
2
	
	
	
235
	
Indefinite-lived
			intangible	assets:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Gigafactory	Nevada
			water	rights
	
	
5
	
	
	
—
	
	
	
—
	
	
	
5
	
	
	
—
	
	
	
—
	
	
	
—
	
	
	
—
	
In-process	research
			and	development
			(“IPR&D”)
	
	
60
	
	
	
—
	
	
	
(
60
)
	
	
—
	
	
	
60
	
	
	
—
	
	
	
(
13
)
	
	
47
	
Total	indefinite-lived
			intangible	assets
	
	
65
	
	
	
—
	
	
	
(
60
)
	
	
5
	
	
	
60
	
	
	
—
	
	
	
(
13
)
	
	
47
	
Total	intangible	assets
	
$
510
	
	
$
(
113
)
	
$
(
58
)
	
$
339
	
	
$
406
	
	
$
(
113
)
	
$
(
11
)
	
$
282
	
During	2019,	the	Company	determined	to	abandon	further	development	efforts	on	the	IPR&D	and	therefore	impaired	the	remaining	$


key: chroma:document
string_value:
47
	million
in	restructuring	and	other	expenses	
in	the	consolidated	statement	of	operations
.	Amortization	expense	during	the	years	ended	December	31,	2019,
2018	and	2017	was	$
44
	million,	$
66
	million	and	$
40
	million,	respectively.
91


key: chroma:document
string_value:
Total	future	amortization	expense	for	finite-lived	intangible	assets	was	estimated	as	follows	(in	millions):
	
2020
	
$
50
	
2021
	
	
49
	
2022
	
	
48
	
2023
	
	
42
	
2024
	
	
27
	
Thereafter
	
	
118
	
Total
	
$
334
	
Note	5	–	Fair	Value	of	Financial	Instruments
ASC	820
,	Fair	Value	Measurements
,	states	that	fair	value	is	an	exit	price,	representing	the	amount	that	would	be	received	to	sell	an	asset	or
paid	to	transfer	a	liability	in	an	orderly	transaction	between	market	participants.	As	such,	fair	value	is	a	market-based	measurement	that	should	be
determined	based	on	assumptions	that	market	participants	would	use	in	pricing	an	asset	or	a	liability
.	The	three-tiered	fair	value	hierarchy,	which
prioritizes	which	inputs	should	be	used	in	measuring	fair	value,	is	comprised	of:	(Level	I)	observable	inputs	such	as	quoted	prices	in	active	markets;
(Level	II)	inputs	other	than	quoted	prices	in	active	markets	that	are	observable	either	directly	or	indirectly	and	(Level	III)	unobservable	inputs	for	which
there	is	little	or	no	market	data.	The	fair	value	hierarchy	requires	the	use	of	observable	market	data	when	available	in	determining	fair	value.	
Our
assets	and	liabilities	that	were	measured	at	fair	value	on	a	recurring	basis	were	as	follows	(in	millions):
	
	
	
December	31,	2019
	
	
December	31,	2018
	
	
	
Fair	Value
	
	
Level	I
	
	
Level	II
	
	
Level	III
	
	
Fair	Value
	
	
Level	I
	
	
Level	II
	
	
Level	III


key: chroma:document
string_value:
Level	II
	
	
Level	III
	
Money	market	funds	(cash	and
			cash	equivalents	&
			restricted	cash)
	
$
1,632
	
	
$
1,632
	
	
$
—
	
	
$
—
	
	
$
1,813
	
	
$
1,813
	
	
$
—
	
	
$
—
	
Interest	rate	swap	asset
	
	
1
	
	
	
—
	
	
	
1
	
	
	
—
	
	
	
12
	
	
	
—
	
	
	
12
	
	
	
—
	
Interest	rate	swap	liability
	
	
(
27
)
	
	
—
	
	
	
(
27
)
	
	
—
	
	
	
(
1
)
	
	
—
	
	
	
(
1
)
	
	
—
	
Total
	
$
1,606
	
	
$
1,632
	
	
$
(
26
)
	
$
—
	
	
$
1,824
	
	
$
1,813
	
	
$
11
	
	
$
—
	
All	of	our	money	market	funds	were	classified	within	Level	I	of	the	fair	value	hierarchy	because	they	were	valued	using	quoted	prices	in	active
markets.	Our	interest	rate	swaps	were	classified	within	Level	II	of	the	fair	value	hierarchy	because	they	were	valued	using	alternative	pricing	sources	or
models	that	utilized	market	observable	inputs,	including	current	and	forward	interest	rates.	During	the	year	ended	December	31,	2019,	there	were	no
transfers	between	the	levels	of	the	fair	value	hierarchy.
Interest	Rate	Swaps


key: chroma:document
string_value:
Interest	Rate	Swaps
We	enter	into	fixed-for-floating	interest	rate	swap	agreements	to	swap	variable	interest	payments	on	certain	debt	for	fixed	interest	payments,	as
required	by	certain	of	our	lenders.	We	do	not	designate	our	interest	rate	swaps	as	hedging	instruments.	Accordingly,	our	interest	rate	swaps	are
recorded	at	fair	value	on	the	consolidated	balance	sheets	within	other	assets	or	other	long-term	liabilities,	with	any	changes	in	their	fair	values
recognized	as	other	income	(expense),	net,	in	the	consolidated	statements	of	operations	and	with	any	cash	flows	recognized	as	investing	activities	in	the
consolidated	statements	of	cash	flows.	
Our	interest	rate	swaps	outstanding	were	as	follows	(in	millions):
	
	
	
December	31,	2019
	
	
December	31,	2018
	
	
	
Aggregate	Notional
Amount
	
	
Gross	Asset	at
Fair	Value
	
	
Gross	Liability	at
Fair	Value
	
	
Aggregate	Notional
Amount
	
	
Gross	Asset	at
Fair	Value
	
	
Gross	Liability	at
Fair	Value
	
Interest	rate	swaps
	
$
821
	
	
$
1
	
	
$
27
	
	
$
800
	
	
$
12
	
	
$
1
	
92


key: chroma:document
string_value:
Our	interest	rate	swaps	activity	was	as	follows	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Gross	gains
	
$
11
	
	
$
22
	
	
$
7
	
Gross	losses
	
$
51
	
	
$
12
	
	
$
13
	
Disclosure	of	Fair	Values
Our	financial	instruments	that	are	not	re-measured	at	fair	value	include	accounts	receivable,	MyPower	customer	notes	receivable,	rebates
receivable,	accounts	payable,	accrued	liabilities,	customer	deposits,	participation	interest	and	debt.	The	carrying	values	of	these	financial	instruments
other	than	our	
1.25
%	Convertible	Senior	Notes	due	in	2021,	
2.375
%	Convertible	Senior	Notes	due	in	2022	and	
2.00
%	Convertible	Senior	Notes	due	in
2024	and	our	subsidiary’s	
Zero
-Coupon	Convertible	Senior	Notes	due	in	2020	(collectively	referred	to	as	“Convertible	Senior	Notes”	below),	
5.30
%
Senior	Notes	due	in	2025,	solar	asset-backed	notes	and	solar	loan-backed	notes	approximate	their	fair	values.
We	estimate	the	fair	value	of	the	Convertible	Senior	Notes	and	the	
5.30
%	Senior	Notes	due	in	2025	using
	commonly	accepted	valuation
methodologies	and	market-based	risk	measurements	that	are	indirectly	observable,	such	as	credit	risk	(Level	II)
.	
In	addition,	
we	estimate	the	fair	values
of	our	solar	asset-backed	notes	and	solar	loan-backed	notes	based	on	rates	currently	offered	for	instruments	with	similar	maturities	and	terms
(Level	III).


key: chroma:document
string_value:
(Level	III).	
The	following	table	presents	the	estimated	fair	values	and	the	carrying	values	(in	millions):
	
	
	
December	31,	2019
	
	
December	31,	2018
	
	
	
Carrying	Value
	
	
Fair	Value
	
	
Carrying	Value
	
	
Fair	Value
	
Convertible	Senior	Notes
	
$
3,686
	
	
$
6,067
	
	
$
3,661
	
	
$
4,347
	
5.30
%
	Senior	Notes	due	in	2025
	
$
1,782
	
	
$
1,748
	
	
$
1,779
	
	
$
1,575
	
Solar	asset-backed	notes
	
$
1,155
	
	
$
1,211
	
	
$
1,183
	
	
$
1,207
	
Solar	loan-backed	notes
	
$
175
	
	
$
189
	
	
$
203
	
	
$
212
	
	
Note	6	–	Inventory
Our	inventory	consisted	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Raw	materials
	
$
1,428
	
	
$
932
	
Work	in	process
	
	
362
	
	
	
297
	
Finished	goods	(1)
	
	
1,356
	
	
	
1,581
	
Service	parts
	
	
406
	
	
	
303
	
Total
	
$
3,552
	
	
$
3,113
	
(1)
Finished	goods	inventory	includes	vehicles	in	transit	to	fulfill	customer	orders,	new	vehicles	available	for	sale,	used	vehicles	and	energy	storage
products.


key: chroma:document
string_value:
products.
For	solar	energy	systems,	we	commence	transferring	component	parts	from	inventory	to	construction	in	progress,	a	component	of	solar	energy
systems,	once	a	lease	or	PPA	contract	with	a	customer	has	been	executed	and	installation	has	been	initiated.	Additional	costs	incurred	on	the	leased
solar	energy	systems,	including	labor	and	overhead,	are	recorded	within	construction	in	progress.
We	write-down	inventory	for	any	excess	or	obsolete	inventories	or	when	we	believe	that	the	net	realizable	value	of	inventories	is	less	than	the
carrying	value.	During	the	years	ended	December	31,	2019,	2018	and	2017,	we	recorded	write-downs	of	$
138
	million,	$
78
	million	and	$
124
	million,
respectively,	in	cost	of	revenues.
	
	
93


key: chroma:document
string_value:
Note	7	–	Solar	Energy	Systems,	Net
Solar	energy	systems,	net,	consisted	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Solar	energy	systems	in	service
	
$
6,682
	
	
$
6,431
	
Initial	direct	costs	related	to	customer	solar	energy
			system	lease	acquisition	costs
	
	
102
	
	
	
99
	
	
	
	
6,784
	
	
	
6,530
	
Less:	accumulated	depreciation	and	amortization	(1)
	
	
(
723
)
	
	
(
496
)
	
	
	
6,061
	
	
	
6,034
	
Solar	energy	systems	under	construction
	
	
18
	
	
	
68
	
Solar	energy	systems	pending	interconnection
	
	
59
	
	
	
169
	
Solar	energy	systems,	net	(2)
	
$
6,138
	
	
$
6,271
	
(1)
Depreciation	and	amortization	expense	during	the	years	ended	December	31,	2019,	2018	and	2017	was	$
227
	million,	$
276
	million,	and	$
213
million,	respectively.
(2)
As	of	December	31,	2019	and	2018,	solar	energy	systems,	net,	included	$
36
	million	of	gross	finance	leased	assets	with	accumulated
depreciation	and	amortization	of	$
6
	million	and	$
4
	million,	respectively.
	
	
Note	8	–	Property,	Plant	and	Equipment,	Net
Our	property,	plant	and	equipment,	net,	consisted	of	the	following	(in	millions):


key: chroma:document
string_value:
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Machinery,	equipment,	vehicles	and	office	furniture
	
$
7,167
	
	
$
6,329
	
Tooling
	
	
1,493
	
	
	
1,398
	
Leasehold	improvements
	
	
1,087
	
	
	
961
	
Land	and	buildings
	
	
3,024
	
	
	
4,047
	
Computer	equipment,	hardware	and	software
	
	
595
	
	
	
487
	
Construction	in	progress
	
	
764
	
	
	
807
	
	
	
	
14,130
	
	
	
14,029
	
Less:	Accumulated	depreciation
	
	
(
3,734
)
	
	
(
2,699
)
Total
	
$
10,396
	
	
$
11,330
	
As	of	December	31,	2018,	the	table	above	included	$
1.69
	billion	of	gross	build-to-suit	lease	assets.	As	a	result	of	the	adoption	of	the	new	lease
standard	on	January	1,	2019,	we	have	de-recognized	all	build-to-suit	lease	assets	and	have	reassessed	these	leases	to	be	operating	lease	right-of-use
assets	within	the	consolidated	balance	sheet	as	of	December	31,	2019	(see	Note	2,	
Summary	of	Significant	Accounting	Policies
).
Construction	in	progress	is	primarily	comprised	of	tooling	and	equipment	related	to	the	manufacturing	of	our	products	and	Gigafactory
Shanghai	construction.	Completed	assets	are	transferred	to	their	respective	asset	classes,	and	depreciation	begins	when	an	asset	is	ready	for	its


key: chroma:document
string_value:
intended	use.	Interest	on	outstanding	debt	is	capitalized	during	periods	of	significant	capital	asset	construction	and	amortized	over	the	useful	lives	of
the	related	assets.	During	the	years	ended	December	31,	2019	and	2018,	we	capitalized	$
31
	million	and	$
55
	million,	respectively,	of	interest.
Depreciation	expense	during	the	years	ended	December	31,	2019,	2018	and	2017	was	$
1.37
	billion,	$
1.11
	billion	and	$
769
	million,	respectively.
Gross	property	plant	and	equipment	under	finance	leases	as	of	December	31,	2019	and	2018	was	$
2.08
	billion	and	$
1.52
	billion,	respectively.
Accumulated	depreciation	on	property,	plant	and	equipment	under	finance	leases	as	of	these	dates	was	$
483
	million	and	$
232
	million,	respectively.
94


key: chroma:document
string_value:
Panasonic	has	partnered	with	us	on	Gigafactory	Nevada	with	investments	in	the	production	equipment	that	it	uses	to	manufacture	and	supply
us	with	battery	cells.	Under	our	arrangement	with	Panasonic,	we	plan	to	purchase	the	full	output	from	their	production	equipment	at	negotiated	prices.
As	the	terms	of	the	arrangement	convey	a	finance	lease	under	ASC	842,	
Leases
,	we	account	for	their	production	equipment	as	leased	assets	when
production	commences.	This	results	in	us	recording	the	cost	of	their	production	equipment	within	property,	plant	and	equipment,	net,	on	the
consolidated	balance	sheets	with	a	corresponding	liability	recorded	to	debt	and	finance	leases.	As	of	December	31,	2019
	and	2018,	we	had	cumulatively
capitalized	costs	of	$
1.73
	billion	and	$
1.24
	billion,	respectively,
	on	the	consolidated	balance	sheets	in	relation	to	the	production	equipment	under	our
Panasonic	arrangement.
	We	had	cumulatively	capitalized	total	costs	for	Gigafactory	Nevada,	including	costs	under	our	Panasonic	arrangement,	of
$
5.27
	billion	and	$
4.62
	billion	as	of	December	31,	2019	and	2018,	respectively.
In	2019,	the	Shanghai	government	agreed	to	provide	$
85
	million	of	certain	incentives	in	connection	with	us	making	certain	manufacturing
equipment	investments	at	Gigafactory	Shanghai,	of	which	$
46
	million	was	received	in	cash	and	the	remaining	$
39
	million	was	in	the	form	of	assets	and
services	contributed	by	the	government.	These	incentives	were	taken	as	a	reduction	to	property,	plant	and	equipment,	net,	on	the	consolidated	balance
sheet.


key: chroma:document
string_value:
sheet.
	
Note	9	–	Accrued	Liabilities	and	Other
	
As	of	December	31,	2019	and	2018,	accrued	liabilities	and	other	current	liabilities	consisted	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Accrued	purchases	(1)
	
$
638
	
	
$
394
	
Payroll	and	related	costs
	
	
466
	
	
	
449
	
Taxes	payable	(2)
	
	
611
	
	
	
348
	
Accrued	interest
	
	
86
	
	
	
78
	
Financing	obligation,	current	portion
	
	
57
	
	
	
62
	
Accrued	warranty,	current	portion
	
	
344
	
	
	
201
	
Sales	return	reserve,	current	portion
	
	
272
	
	
	
108
	
Build-to-suit	lease	liability,	current	portion
	
	
—
	
	
	
82
	
Operating	lease	right-of-use	liabilities,	current	portion
	
	
228
	
	
	
—
	
Other	current	liabilities
	
	
203
	
	
	
372
	
Total
	
$
2,905
	
	
$
2,094
	
(1)
Accrued	purchases	primarily	reflects	receipts	of	goods	and	services	that	we	had	not	been	invoiced	yet.	As	we	are	invoiced	for	these	goods	and
services,	this	balance	will	reduce	and	accounts	payable	will	increase.
(2)
Taxes	payable	includes	value	added	tax,	sales	tax,	property	tax,	use	tax	and	income	tax	payables.


key: chroma:document
string_value:
Due	to	price	adjustments	we	made	to	our	vehicle	offerings	during	2019,	we	increased	our	sales	return	reserve	significantly	on	vehicles
previously	sold	under	our	buyback	options	program.	
See	Note	2,	
Summary	of	Significant	Accounting	Policies
	for	details.
As	of	December	31,	2018,	the	table	above	included	$
82
	million	of	current	build-to-suit	lease	liabilities.	As	a	result	of	the	adoption	of	the	new
lease	standard	on	January	1,	2019,	we	have	de-recognized	all	build-to-suit	lease	liabilities	and	have	reassessed	these	leases	to	be	operating	lease	right-
of-use	liabilities	as	of	December	31,	2019.
	
	
95


key: chroma:document
string_value:
Note	10	–	Other	Long-Term	Liabilities
As	of	December	31,	2019	and	2018,	other	long-term	liabilities	consisted	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Accrued	warranty	reserve
	
$
745
	
	
$
547
	
Build-to-suit	lease	liability
	
	
—
	
	
	
1,662
	
Operating	lease	right-of-use	liabilities
	
	
956
	
	
	
—
	
Deferred	rent	expense
	
	
—
	
	
	
59
	
Financing	obligation
	
	
37
	
	
	
50
	
Sales	return	reserve
	
545
	
	
	
84
	
Other	noncurrent	liabilities
	
	
372
	
	
	
308
	
Total	other	long-term	liabilities
	
$
2,655
	
	
$
2,710
	
As	of	December	31,	2018,	the	table	above	included	$
1.66
	billion	of	non-current	build-to-suit	lease	liabilities.	As	a	result	of	the	adoption	of	the
new	lease	standard	on	January	1,	2019,	we	have	de-recognized	all	build-to-suit	lease	liabilities	and	have	reassessed	these	leases	to	be	operating	lease
right-of-use	liabilities	as	of	December	31,	2019.
Due	to	price	adjustments	we	made	to	our	vehicle	offerings	during	2019,	we	increased	our	sales	return	reserve	significantly	on	vehicles
previously	sold	under	our	buyback	options	program.	Refer	to	Note	2,	
Summary	of	Significant	Accounting	Policies
,	for	details	on	these	transactions.
	
	
Note	11	–	Customer	Deposits


key: chroma:document
string_value:
Note	11	–	Customer	Deposits
Customer	deposits	primarily	consisted	of	cash	payments	from	customers	at	the	time	they	place	an	order	or	reservation	for	a	vehicle	or	an
energy	product	and	any	additional	payments	up	to	the	point	of	delivery	or	the	completion	of	installation,	including	the	fair	values	of	any	customer	trade-
in	vehicles	that	are	applicable	toward	a	new	vehicle	purchase.	
Customer	deposits	also	include	prepayments	on	contracts	that	can	be	cancelled	without
significant	penalties,	such	as	vehicle	maintenance	plans.	
Customer	deposit	amounts	and	timing	vary	depending	on	the	vehicle	model,	the	energy
product	and	the	country	of	delivery.	In	the	case	of	a	vehicle,	customer	deposits	are	fully	refundable.	In	the	case	of	an	energy	generation	or	storage
product,	customer	deposits	are	fully	refundable	prior	to	the	entry	into	a	purchase	agreement	or	in	certain	cases	for	a	limited	time	thereafter	(in
accordance	with	applicable	laws).	Customer	deposits	are	included	in	current	liabilities	until	refunded	or	until	they	are	applied	towards	the	customer’s
purchase	balance.	As	of	December	31,	2019	and	December	31,	2018,	we	held	$
726
	million	and	$
793
	million,	respectively,	in	customer	deposits.
	
96


key: chroma:document
string_value:
Note	12	–Debt
The	following	is	a	summary	of	our	debt	as	of	December	31,	2019	(in	millions):
	
	
	
Unpaid
	
	
	
	
	
Unused
	
	
	
	
	
	
	
	
	
Principal
	
	
Net	Carrying	Value
	
	
Committed
	
	
Contractual
	
	
Contractual
	
	
Balance
	
	
Current
	
	
Long-Term
	
	
Amount	(1)
	
	
Interest	Rates
	
	
Maturity	Date
Recourse	debt:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
1.25%	Convertible	Senior	Notes	due	in	2021
			("2021	Notes")
	
$
1,380
	
	
$
—
	
	
$
1,304
	
	
$
—
	
	
	
1.25
%
	
March	2021
2.375%	Convertible	Senior	Notes	due	in	2022
			("2022	Notes")
	
	
978
	
	
	
—
	
	
	
902
	
	
	
—
	
	
	
2.375
%
	
March	2022
2.00%	Convertible	Senior	Notes	due	in	2024
			("2024	Notes")
	
	
1,840
	
	
	
—
	
	
	
1,383
	
	
	
—
	
	
	
2.00
%
	
May	2024
5.30%	Senior	Notes	due	in	2025
			("2025	Notes")
	
	
1,800
	
	
	
—
	
	
	
1,782
	
	
	
—
	
	
	
5.30


key: chroma:document
string_value:
—
	
	
	
5.30
%
	
August	2025
Credit	Agreement
	
	
1,727
	
	
	
141
	
	
	
1,586
	
	
	
499
	
	
2.7%-4.8%
	
	
June	2020-July	2023
Zero-Coupon	Convertible	Senior	Notes	due	in
			2020
	
	
103
	
	
	
97
	
	
	
—
	
	
	
—
	
	
	
0.0
%
	
December	2020
Solar	Bonds	and	other	Loans
	
	
70
	
	
	
15
	
	
	
53
	
	
	
—
	
	
3.6%-5.8%
	
	
March	2020-January	2031
Total	recourse	debt
	
	
7,898
	
	
	
253
	
	
	
7,010
	
	
	
499
	
	
	
	
	
	
	
Non-recourse	debt:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Automotive	Asset-backed	Notes
	
	
1,577
	
	
	
573
	
	
	
997
	
	
	
—
	
	
2.0%-7.9%
	
	
February	2020-	May	2023
Solar	Asset-backed	Notes
	
	
1,183
	
	
	
32
	
	
	
1,123
	
	
	
—
	
	
4.0%-7.7%
	
	
September	2024-February	2048
China	Loan	Agreements
	
	
741
	
	
	
444
	
	
	
297
	
	
	
1,542


key: chroma:document
string_value:
297
	
	
	
1,542
	
	
3.7%-4.0%
	
	
September	2020-December	2024
Cash	Equity	Debt
	
	
454
	
	
	
10
	
	
	
430
	
	
	
—
	
	
5.3%-5.8%
	
	
July	2033-January	2035
Solar	Loan-backed	Notes
	
	
182
	
	
	
11
	
	
	
164
	
	
	
—
	
	
4.8%-7.5%
	
	
September	2048-September	2049
Warehouse	Agreements
	
	
167
	
	
	
21
	
	
	
146
	
	
	
933
	
	
3.1%-3.6%
	
	
September	2021
Solar	Term	Loans
	
	
161
	
	
	
8
	
	
	
152
	
	
	
—
	
	
	
5.4
%
	
January	2021
Canada	Credit	Facility
	
	
40
	
	
	
24
	
	
	
16
	
	
	
—
	
	
4.2%-5.9%
	
	
November	2022
Solar	Renewable	Energy	Credit	and
			other	Loans
	
	
89
	
	
	
23
	
	
	
67
	
	
	
6
	
	
4.5%-7.4%
	
	
March	2020-June	2022
Total	non-recourse	debt
	
	
4,594
	
	
	
1,146
	
	
	
3,392
	
	
	
2,481
	
	
	
	
	
	
	
Total	debt
	
$
12,492
	
	
$
1,399
	
	
$
10,402


key: chroma:document
string_value:
The	following	is	a	summary	of	our	debt	as	of	
December	31,	2018
	(in	millions):
	
	
	
Unpaid
	
	
	
	
	
Unused
	
	
	
	
	
	
	
	
	
Principal
	
	
Net	Carrying	Value
	
	
Committed
	
	
Contractual
	
	
Contractual
	
	
Balance
	
	
Current
	
	
Long-Term
	
	
Amount	(1)
	
	
Interest	Rates
	
	
Maturity	Date
Recourse	debt:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
0.25%	Convertible	Senior	Notes	due	in	2019
			("2019	Notes")
	
$
920
	
	
$
913
	
	
$
—
	
	
$
—
	
	
	
0.25
%
	
March	2019
2021	Notes
	
	
1,380
	
	
	
—
	
	
	
1,244
	
	
	
—
	
	
	
1.25
%
	
March	2021
2022	Notes
	
	
978
	
	
	
—
	
	
	
871
	
	
	
—
	
	
	
2.375
%
	
March	2022
2025	Notes
	
	
1,800
	
	
	
—
	
	
	
1,779
	
	
	
—
	
	
	
5.30
%
	
August	2025
Credit	Agreement
	
	
1,540
	
	
	
—
	
	
	
1,540
	
	
	
231
	
	
1%	plus	LIBOR
	
	
June	2020


key: chroma:document
string_value:
June	2020
1.625%	Convertible	Senior	Notes	due	in	2019
	
	
566
	
	
	
541
	
	
	
—
	
	
	
—
	
	
	
1.625
%
	
November	2019
Zero-Coupon	Convertible	Senior	Notes	due	in
			2020
	
	
103
	
	
	
—
	
	
	
92
	
	
	
—
	
	
	
0.0
%
	
December	2020
Vehicle,	Solar	Bonds	and	other	Loans
	
	
101
	
	
	
1
	
	
	
100
	
	
	
—
	
	
1.8%-7.6%
	
	
January	2019-January	2031
Total	recourse	debt
	
	
7,388
	
	
	
1,455
	
	
	
5,626
	
	
	
231
	
	
	
	
	
	
	
Non-recourse	debt:
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Solar	Asset-backed	Notes
	
	
1,214
	
	
	
28
	
	
	
1,155
	
	
	
—
	
	
4.0%-7.7%
	
	
September	2024-February	2048
Automotive	Asset-backed	Notes
	
	
1,178
	
	
	
468
	
	
	
704
	
	
	
—
	
	
2.3%-7.9%
	
	
December	2019-June	2022
Cash	Equity	Debt
	
	
467
	
	
	
11
	
	
	
442
	
	
	
—
	
	
5.3%-5.8%


key: chroma:document
string_value:
5.3%-5.8%
	
	
July	2033-January	2035
Solar	Term	Loans
	
	
350
	
	
	
188
	
	
	
162
	
	
	
—
	
	
6.0%-6.1%
	
	
January	2019-January	2021
Solar	Loan-backed	Notes
	
	
210
	
	
	
10
	
	
	
193
	
	
	
—
	
	
4.8%-7.5%
	
	
September	2048-September	2049
Warehouse	Agreements
	
	
92
	
	
	
14
	
	
	
78
	
	
	
1,008
	
	
3.9%-4.2%
	
	
September	2020
Canada	Credit	Facility
	
	
73
	
	
	
32
	
	
	
41
	
	
	
—
	
	
3.6%-5.9%
	
	
November	2022
Solar	Renewable	Energy	Credit	and
			other	Loans
	
	
27
	
	
	
16
	
	
	
10
	
	
	
18
	
	
5.1%-7.9%
	
	
December	2019-July	2021
Total	non-recourse	debt
	
	
3,611
	
	
	
767
	
	
	
2,785
	
	
	
1,026
	
	
	
	
	
	
	
Total	debt
	
$
10,999
	
	
$
2,222
	
	
$
8,411
	
	
$
1,257
	
	
	
	
	
	
	
(1)
Unused	committed	amounts	under	some	of	our	credit	facilities	and	financing	funds	are	subject	to	satisfying	specified	conditions	prior	to	draw-


key: chroma:document
string_value:
down	(such	as	pledging	to	our	lenders	sufficient	amounts	of	qualified	receivables,	inventories,	leased	vehicles	and	our	interests	in	those	leases,
solar	energy	systems	and	the	associated	customer	contracts,	our	interests	in	financing	funds	or	various	other	assets).	Upon	draw-down	of	any
unused	committed	amounts,	there	are	no	restrictions	on	use	of	available	funds	for	general	corporate	purposes.
Recourse	debt	refers	to	debt	that	is	recourse	to	our	general	assets.	Non-recourse	debt	refers	to	debt	that	is	recourse	to	only	assets	of	our
subsidiaries.	The	differences	between	the	unpaid	principal	balances	and	the	net	carrying	values	are	due	to	convertible	senior	note	conversion	features,
debt	discounts	or	deferred	financing	costs.	As	of	December	31,	2019,	we	were	in	material	compliance	with	all	financial	debt	covenants,	which	include
minimum	liquidity	and	expense-coverage	balances	and	ratios.
2019	Notes,	2021	Notes,	Bond	Hedges	and	Warrant	Transactions
In	March	2014,	we	issued	$
800
	million	in	aggregate	principal	amount	of	
0.25
%	Convertible	Senior	Notes	due	in	
March	2019
	and	$
1.20
	billion	in
aggregate	principal	amount	of	
1.25
%	Convertible	Senior	Notes	due	in	
March	2021
	in	a	public	offering.	In	April	2014,	we	issued	an	additional
$
120
	million	in	aggregate	principal	amount	of	the	2019	Notes	and	$
180
	million	in	aggregate	principal	amount	of	the	2021	Notes,	pursuant	to	the
exercise	in	full	of	the	overallotment	options	by	the	underwriters.	The	total	net	proceeds	from	the	issuances,	after	deducting	transaction	costs,	were
$
906


key: chroma:document
string_value:
Each	$
1,000
	of	principal	of	these	notes	is	initially	convertible	into	
2.7788
	shares	of	our	common	stock,	which	is	equivalent	to	an	initial
conversion	price	of	$
359.87
	per	share,	subject	to	adjustment	upon	the	occurrence	of	specified	events.	Holders	of	these	notes	had	the	option	to	convert
on	or	after	December	1,	2018	for	the	2019	Notes	and	may	elect	to	convert	on	or	after	December	1,	2020	for	the	2021	Notes.	The	settlement	of	such	an
election	to	convert	the	2019	Notes	was	in	cash	and/or	shares	of	our	common	stock,	which	we	settled	in	cash	on	the	maturity	date.	The	settlement	of
such	an	election	to	convert	the	2021	Notes	would	be	in	cash	for	the	principal	amount	and,	if	applicable,	cash	and/or	shares	of	our	common	stock	for	any
conversion	premium	at	our	election.	Further,	holders	of	these	notes	may	convert,	at	their	option,	prior	to	the	respective	dates	above	only	under	the
following	circumstances:	(1)	during	a	quarter	in	which	the	closing	price	of	our	common	stock	for	at	least	
20
	trading	days	(whether	or	not	consecutive)
during	the	last	
30
	consecutive	trading	days	immediately	preceding	the	quarter	is	greater	than	or	equal	to	
130
%	of	the	conversion	price;	(2)	during	the
five-business	day	period	following	any	
five
-consecutive	trading	day	period	in	which	the	trading	price	of	these	notes	is	less	than	
98
%	of	the	product	of
the	closing	price	of	our	common	stock	and	the	applicable	conversion	rate	for	each	day	during	such	five-consecutive	trading	day	period,	or	(3)	if	we	make


key: chroma:document
string_value:
specified	distributions	to	holders	of	our	common	stock	or	if	specified	corporate	transactions	occur.	Upon	such	a	conversion	of	the	2019	Notes,	we	would
pay	or	deliver	(as	applicable)	cash,	shares	of	our	common	stock	or	a	combination	thereof,	at	our	election.	Upon	such	a	conversion	of	the	2021	Notes,	we
would	pay	cash	for	the	principal	amount	and,	if	applicable,	deliver	shares	of	our	common	stock	(subject	to	our	right	to	deliver	cash	in	lieu	of	all	or	a
portion	of	such	shares	of	our	common	stock)	based	on	a	daily	conversion	value.	If	a	fundamental	change	occurs	prior	to	the	applicable	maturity	date,
holders	of	these	notes	may	require	us	to	repurchase	all	or	a	portion	of	their	notes	for	cash	at	a	repurchase	price	equal	to	
100
%	of	the	principal	amount
plus	any	accrued	and	unpaid	interest.	In	addition,	if	specific	corporate	events	occur	prior	to	the	applicable	maturity	date,	we	would	increase	the
conversion	rate	for	a	holder	who	elects	to	convert	their	notes	in	connection	with	such	an	event	in	certain	circumstances.	As	of	December	31,	2019,	none
of	the	conditions	permitting	the	holders	of	2021	to	early	convert	had	been	met.	Therefore,	the	2021	Notes	are	classified	as	long-term.
In	accordance	with	GAAP	relating	to	embedded	conversion	features,	we	initially	valued	and	bifurcated	the	conversion	features	associated	with
these	notes.	We	recorded	to	stockholders’	equity	$
188
	million	for	the	2019	Notes’	conversion	feature	and	$
369
	million	for	the	2021	Notes’	conversion
feature.	The	resulting	debt	discounts	are	being	amortized	to	interest	expense	at	an	effective	interest	rate	of	
4.89
%	and	
5.96


key: chroma:document
string_value:
4.89
%	and	
5.96
%,	respectively.
In	connection	with	the	offering	of	these	notes	in	March	and	April	2014,	we	entered	into	convertible	note	hedge	transactions	whereby	we	had	the
option	to	purchase	
2.6
	million	shares	of	our	common	stock	for	the	2019	Notes	and	have	the	option	to	purchase	initially	(subject	to	adjustment	for
certain	specified	events)	
3.8
	million	shares	of	our	common	stock	for	the	2021	Notes	at	a	price	of	$
359.87
	per	share.	The	total	cost	of	the	convertible
note	hedge	transactions	was	$
604
	million.	In	addition,	we	sold	warrants	whereby	the	holders	of	the	warrants	had	the	option	to	purchase	
2.6
	million
shares	of	our	common	stock	at	a	price	of	$
512.66
	per	share	for	the	2019	Notes	and	have	the	option	to	purchase	initially	(subject	to	adjustment	for
certain	specified	events)	
3.8
	million	shares	of	our	common	stock	at	a	price	of	$
560.64
	per	share	for	the	2021	Notes.	We	received	$
389
	million	in	total
cash	proceeds	from	the	sales	of	these	warrants.	Taken	together,	the	purchases	of	the	convertible	note	hedges	and	the	sales	of	the	warrants	are	intended
to	reduce	potential	dilution	and/or	cash	payments	from	the	conversion	of	these	notes	and	to	effectively	increase	the	overall	conversion	price	from
$
359.87
	to	$
512.66
	per	share	for	the	2019	Notes	and	from	$
359.87
	to	$
560.64
	per	share	for	the	2021	Notes.	As	these	transactions	meet	certain
accounting	criteria,	the	convertible	note	hedges	and	warrants	are	recorded	in	stockholders’	equity	and	are	not	accounted	for	as	derivatives.	The	net


key: chroma:document
string_value:
cost	incurred	in	connection	with	the	convertible	note	hedge	and	warrant	transactions	was	recorded	as	a	reduction	to	additional	paid-in	capital	on	the
consolidated	balance	sheet.
During	the	first	quarter	of	2019,	we	repaid	the	$
920
	million	in	aggregate	principal	amount	of	the	2019	Notes.	
As	of	December	31,	2019,	the
convertible	note	hedges	and	warrants	associated	with	the	2019	Notes	have	expired.
As	of	December	31,	2019,	the	if-converted	value	of	the	2021	Notes	exceeds	the	outstanding	principal	amount	by	$
224
	million.
2022	Notes,	Bond	Hedges	and	Warrant	Transactions
In	March	2017,	we	issued	$
978
	million	in	aggregate	principal	amount	of	
2.375
%	Convertible	Senior	Notes	due	in	
March	2022
	in	a	public
offering.	The	net	proceeds	from	the	issuance,	after	deducting	transaction	costs,	were	$
966
	million.
99


key: chroma:document
string_value:
Each	$
1,000
	of	principal	of	the	2022	Notes	is	initially	convertible	into	
3.0534
	shares	of	our	common	stock,	which	is	equivalent	to	an	initial
conversion	price	of	$
327.50
	per	share,	subject	to	adjustment	upon	the	occurrence	of	specified	events.	Holders	of	the	2022	Notes	may	convert,	at	their
option,	on	or	after	December	15,	2021.	Further,	holders	of	the	2022	Notes	may	convert,	at	their	option,	prior	to	December	15,	2021	only	under	the
following	circumstances:	(1)	during	any	quarter	beginning	after	June	30,	2017,	if	the	closing	price	of	our	common	stock	for	at	least	
20
	trading	days
(whether	or	not	consecutive)	during	the	last	
30
	consecutive	trading	days	immediately	preceding	the	quarter	is	greater	than	or	equal	to	
130
%	of	the
conversion	price;	(2)	during	the	
five
-business	day	period	following	any	five-consecutive	trading	day	period	in	which	the	trading	price	of	the	2022	Notes
is	less	than	
98
%	of	the	product	of	the	closing	price	of	our	common	stock	and	the	applicable	conversion	rate	for	each	day	during	such	five-consecutive
trading	day	period	or	(3)	if	we	make	specified	distributions	to	holders	of	our	common	stock	or	if	specified	corporate	transactions	occur.	Upon	a
conversion,	we	would	pay	cash	for	the	principal	amount	and,	if	applicable,	deliver	shares	of	our	common	stock	(subject	to	our	right	to	deliver	cash	in
lieu	of	all	or	a	portion	of	such	shares	of	our	common	stock)	based	on	a	daily	conversion	value.	If	a	fundamental	change	occurs	prior	to	the	maturity	date,


key: chroma:document
string_value:
holders	of	the	2022	Notes	may	require	us	to	repurchase	all	or	a	portion	of	their	2022	Notes	for	cash	at	a	repurchase	price	equal	to	
100
%	of	the
principal	amount	plus	any	accrued	and	unpaid	interest.	In	addition,	if	specific	corporate	events	occur	prior	to	the	maturity	date,	we	would	increase	the
conversion	rate	for	a	holder	who	elects	to	convert	its	2022	Notes	in	connection	with	such	an	event	in	certain	circumstances.	As	of	December	31,	2019,
none	of	the	conditions	permitting	the	holders	of	the	2022	Notes	to	early	convert	had	been	met.	Therefore,	the	2022	Notes	are	classified	as	long-term.
In	accordance	with	GAAP	relating	to	embedded	conversion	features,	we	initially	valued	and	bifurcated	the	conversion	feature	associated	with
the	2022	Notes.	We	recorded	to	stockholders’	equity	$
146
	million	for	the	conversion	feature.	The	resulting	debt	discount	is	being	amortized	to	interest
expense	at	an	effective	interest	rate	of	
6.00
%.
In	connection	with	the	offering	of	the	2022	Notes,	we	entered	into	convertible	note	hedge	transactions	whereby	we	have	the	option	to	purchase
initially	(subject	to	adjustment	for	certain	specified	events)	
3.0
	million	shares	of	our	common	stock	at	a	price	of	$
327.50
	per	share.	The	cost	of	the
convertible	note	hedge	transactions	was	$
204
	million.	In	addition,	we	sold	warrants	whereby	the	holders	of	the	warrants	have	the	option	to	purchase
initially	(subject	to	adjustment	for	certain	specified	events)	
3.0
	million	shares	of	our	common	stock	at	a	price	of	$
655.00
	per	share.	We	received
$
53


key: chroma:document
string_value:
per	share.	We	received
$
53
	million	in	cash	proceeds	from	the	sale	of	these	warrants.	Taken	together,	the	purchase	of	the	convertible	note	hedges	and	the	sale	of	the	warrants
are	intended	to	reduce	potential	dilution	from	the	conversion	of	the	2022	Notes	and	to	effectively	increase	the	overall	conversion	price	from	$
327.50
	to
$
655.00
	per	share.	As	these	transactions	meet	certain	accounting	criteria,	the	convertible	note	hedges	and	warrants	are	recorded	in	stockholders’
equity	and	are	not	accounted	for	as	derivatives.	The	net	cost	incurred	in	connection	with	the	convertible	note	hedge	and	warrant	transactions	was
recorded	as	a	reduction	to	additional	paid-in	capital	on	the	consolidated	balance	sheet.
As	of	December	31,	2019,	the	if-converted	value	of	the	notes	exceeds	the	outstanding	principal	amount	by	$
271
	million.
2024	Notes,	Bond	Hedges	and	Warrant	Transactions
In	May	2019,	we	issued	$
1.84
	billion	in	aggregate	principal	amount	of	
2.00
%	Convertible	Senior	Notes	due	in	
May	2024
	in	a	public	offering.	The
net	proceeds	from	the	issuance,	after	deducting	transaction	costs,	were	$
1.82
	billion.
100


key: chroma:document
string_value:
Each	$
1,000
	of	principal	of	the	2024	Notes	is	initially	convertible	into	
3.2276
	shares	of	our	common	stock,	which	is	equivalent	to	an	initial
conversion	price	of	$
309.83
	per	share,	subject	to	adjustment	upon	the	occurrence	of	specified	events.	Holders	of	the	2024	Notes	may	convert,	at	their
option,	on	or	after	February	15,	2024.	Further,	holders	of	the	2024	Notes	may	convert,	at	their	option,	prior	to	February	15,	2024	only	under	the
following	circumstances:	(1)	during	any	calendar	quarter	commencing	after	September	30,	2019	(and	only	during	such	calendar	quarter),	if	the	last
reported	sale	price	of	our	common	stock	for	at	least	
20
	trading	days	(whether	or	not	consecutive)	during	a	period	of	
30
	consecutive	trading	days	ending
on	the	last	trading	day	of	immediately	preceding	calendar	quarter	is	greater	than	or	equal	to	
130
%	of	the	conversion	price	on	each	trading	day;	(2)
during	the	five-business	day	period	after	any	
five
-consecutive	trading	day	period	in	which	the	trading	price	per	$1,000	principal	amount	of	the	2024
Notes	for	each	trading	day	of	such	period	is	less	than	
98
%	of	the	product	of	the	last	reported	sale	price	of	our	common	stock	and	the	conversion	rate	on
each	such	trading	day,	or	(3)	if	specified	corporate	events	occur.	Upon	conversion,	the	2024	Notes	will	be	settled	in	cash,	shares	of	our	common	stock
or	a	combination	thereof,	at	our	election.	If	a	fundamental	change	occurs	prior	to	the	maturity	date,	holders	of	the	2024	Notes	may	require	us	to


key: chroma:document
string_value:
repurchase	all	or	a	portion	of	their	2024	Notes	for	cash	at	a	repurchase	price	equal	to	
100
%	of	the	principal	amount	plus	any	accrued	and	unpaid
interest.	In	addition,	if	specific	corporate	events	occur	prior	to	the	maturity	date,	we	would	increase	the	conversion	rate	for	a	holder	who	elects	to
convert	its	2024	Notes	in	connection	with	such	an	event	in	certain	circumstances.	As	of	December	31,	2019,	none	of	the	conditions	permitting	the
holders	of	the	2024	Notes	to	early	convert	had	been	met.	Therefore,	the	2024	Notes	are	classified	as	long-term.
In	accordance	with	GAAP	relating	to	embedded	conversion	features,	we	initially	valued	and	bifurcated	the	conversion	feature	associated	with
the	2024	Notes.	We	recorded	to	stockholders’	equity	$
491
	million	for	the	conversion	feature.	The	resulting	debt	discount	is	being	amortized	to	interest
expense	at	an	effective	interest	rate	of	
8.68
%.
In	connection	with	the	offering	of	the	2024	Notes,	we	entered	into	convertible	note	hedge	transactions	whereby	we	have	the	option	to	purchase
initially	(subject	to	adjustment	for	certain	specified	events)	
5.9
	million	shares	of	our	common	stock	at	a	price	of	$
309.83
	per	share.	The	cost	of	the
convertible	note	hedge	transactions	was	$
476
	million.	In	addition,	we	sold	warrants	whereby	the	holders	of	the	warrants	have	the	option	to	purchase
initially	(subject	to	adjustment	for	certain	specified	events)	
5.9
	million	shares	of	our	common	stock	at	a	price	of	$
607.50
	per	share.	We	received
$
174


key: chroma:document
string_value:
per	share.	We	received
$
174
	million	in	cash	proceeds	from	the	sale	of	these	warrants.	Taken	together,	the	purchase	of	the	convertible	note	hedges	and	the	sale	of	the	warrants
are	intended	to	reduce	potential	dilution	from	the	conversion	of	the	2024	Notes	and	to	effectively	increase	the	overall	conversion	price	from	$
309.83
	to
$
607.50
	per	share.	As	these	transactions	meet	certain	accounting	criteria,	the	convertible	note	hedges	and	warrants	are	recorded	in	stockholders’
equity	and	are	not	accounted	for	as	derivatives.	The	net	cost	incurred	in	connection	with	the	convertible	note	hedge	and	warrant	transactions	was
recorded	as	a	reduction	to	additional	paid-in	capital	on	the	consolidated	balance	sheet.
As	of	December	31,	2019,	the	if-converted	value	of	the	notes	exceeds	the	outstanding	principal	amount	by	$
644
	million.
2025	Notes
In	August	2017,	we	issued	$
1.80
	billion	in	aggregate	principal	amount	of	unsecured	
5.30
%	Senior	Notes	due	in	
August	2025
	pursuant	to
Rule	144A	and	Regulation	S	under	the	Securities	Act.	The	net	proceeds	from	the	issuance,	after	deducting	transaction	costs,	were	$
1.77
	billion.
Credit	Agreement
In	June	2015,	we	entered	into	a	senior	asset-based	revolving	credit	agreement	(as	amended	from	time	to	time,	the	“Credit	Agreement”)	with	a
syndicate	of	banks.	Borrowed	funds	bear	interest,	at	our	option,	at	an	annual	rate	of	(a)	
1
%	plus	LIBOR	or	(b)	the	highest	of	(i)	the	federal	funds	rate
plus	
0.50


key: chroma:document
string_value:
plus	
0.50
%,	(ii)	the	lenders’	“prime	rate”	or	(iii)	1%	plus	LIBOR.	The	fee	for	undrawn	amounts	is	
0.25
%	per	annum.	The	Credit	Agreement	is	secured	by
certain	of	our	accounts	receivable,	inventory	and	equipment.	Availability	under	the	Credit	Agreement	is	based	on	the	value	of	such	assets,	as	reduced
by	certain	reserves.
In	March	2019,	we	amended	and	restated	the	Credit	Agreement	to	increase	the	total	lender	commitments	by	$
500
	million	to	$
2.425
	billion	and
extend	the	term	of	substantially	all	of	the	total	commitments	to	
July	2023
.
101


key: chroma:document
string_value:
1.625%	Convertible	Senior	Notes	due	in	2019
In	2014,	SolarCity	issued	$
566
	million	in	aggregate	principal	amount	of	
1.625
%	Convertible	Senior	Notes	due	on	
November	1,	2019
	in	a	private
placement.
Each	$
1,000
	of	principal	of	the	convertible	senior	notes	was	convertible	into	
1.3169
	shares	of	our	common	stock,	which	is	equivalent	to	a
conversion	price	of	$
759.36
	per	share	(subject	to	adjustment	upon	the	occurrence	of	specified	events	related	to	dividends,	tender	offers	or	exchange
offers).	The	maximum	conversion	rate	was	capped	at	
1.7449
	shares	for	each	$1,000	of	principal	of	the	convertible	senior	notes,	which	is	equivalent	to	a
minimum	conversion	price	of	$
573.10
	per	share.	The	convertible	senior	notes	did	not	have	a	cash	conversion	option	and	the	convertible	senior	note
holders	could	require	us	to	repurchase	their	convertible	senior	notes	for	cash	only	under	certain	defined	fundamental	changes.
	
In	November	2019,	we	fully	repaid	$
566
	million	in	aggregate	principal	amount	of	the	Notes.
Zero-Coupon	Convertible	Senior	Notes	due	in	2020
In	December	2015,	SolarCity	issued	$
113
	million	in	aggregate	principal	amount	of	
Zero
-Coupon	Convertible	Senior	Notes	due	on	
December	1,
2020
	in	a	private	placement.	$
13
	million	of	the	convertible	senior	notes	were	issued	to	related	parties	(see	Note	20,	
Related	Party	Transactions
).
Each	$
1,000
	of	principal	of	the	convertible	senior	notes	is	now	convertible	into	
3.3333


key: chroma:document
string_value:
3.3333
	shares	of	our	common	stock,	which	is	equivalent	to	a
conversion	price	of	$
300.00
	per	share	(subject	to	adjustment	upon	the	occurrence	of	specified	events	related	to	dividends,	tender	offers	or	exchange
offers).	The	maximum	conversion	rate	is	capped	at	
4.2308
	shares	for	each	$1,000	of	principal	of	the	convertible	senior	notes,	which	is	equivalent	to	a
minimum	conversion	price	of	$
236.36
	per	share.	The	convertible	senior	notes	do	not	have	a	cash	conversion	option.	
The	convertible	senior	note	holders
may	require	us	to	repurchase	their	convertible	senior	notes	for	cash	only	under	certain	defined	fundamental	changes.	On	or	after	June	30,	2017,	the
convertible	senior	notes	are	redeemable	by	us	in	the	event	that	the	closing	price	of	our	common	stock	exceeds	
200
%	of	the	conversion	price	for	
45
consecutive	trading	days	ending	within	three	trading	days	of	such	redemption	notice	at	a	redemption	price	equal	to	
100
%	of	the	principal	amount	plus
any	accrued	and	unpaid	interest.
As	of	December	31,	2019,	the	if-converted	value	of	the	notes	exceeds	the	outstanding	principal	amount	by	$
41
	million.
	
Solar	Bonds	and	other	Loans
Solar	Bonds	are	senior	unsecured	obligations	that	are	structurally	subordinate	to	the	indebtedness	and	other	liabilities	of	our	subsidiaries.	Solar
Bonds	were	issued	under	multiple	series	with	various	terms	and	interest	rates.	Additionally,	we	have	assumed	the	
5.50
%	Convertible	Senior	Notes	due


key: chroma:document
string_value:
5.50
%	Convertible	Senior	Notes	due
in	2022	issued	by	Maxwell,	which	are	convertible	into	shares	of	our	common	stock	as	a	result	of	our	acquisition	of	Maxwell.
Automotive	Asset-backed	Notes
From	time	to	time,	we	transfer	receivables	or	beneficial	interests	related	to	certain	leased	vehicles	into	SPEs	and	issue	Automotive	Asset-
backed	Notes,	backed	by	these	automotive	assets	to	investors.	The	SPEs	are	consolidated	in	the	financial	statements.	The	cash	flows	generated	by	these
automotive	assets	are	used	to	service	the	principal	and	interest	payments	on	the	Automotive	Asset-backed	Notes	and	satisfy	the	SPEs’	expenses,	and
any	remaining	cash	is	distributed	to	the	owners	of	the	SPEs.	We	recognize	revenue	earned	from	the	associated	customer	lease	contracts	in	accordance
with	our	revenue	recognition	policy.	The	SPEs’	assets	and	cash	flows	are	not	available	to	our	other	creditors,	and	the	creditors	of	the	SPEs,	including
the	Automotive	Asset-backed	Note	holders,	have	no	recourse	to	our	other	assets.	A	third-party	contracted	with	us	to	provide	administrative	and
collection	services	for	these	automotive	assets.
In	November	2019,	we	issued	$
861
	million	in	aggregate	principal	amount	of	Automotive	Asset-backed	Notes.	The	proceeds	from	the	issuance,
net	of	discounts	and	fees,	were	$
857
	million.
102


key: chroma:document
string_value:
Solar	Asset-backed	Notes
From	time	to	time,	our	subsidiaries	pool	and	transfer	either	qualifying	solar	energy	systems	and	the	associated	customer	contracts	or	our
interests	in	certain	financing	funds	into	Special	Purpose	Entities	(“SPEs”)	and	issue	Solar	Asset-backed	Notes	backed	by	these	solar	assets	or	interests
to	investors.	The	SPEs	are	wholly	owned	by	us	and	are	consolidated	in	the	financial	statements.	The	cash	flows	generated	by	these	solar	assets	or
distributed	by	the	underlying	financing	funds	to	certain	SPEs	are	used	to	service	the	principal	and	interest	payments	on	the	Solar	Asset-backed	Notes
and	satisfy	the	SPEs’	expenses,	and	any	remaining	cash	is	distributed	to	us.	We	recognize	revenue	earned	from	the	associated	customer	contracts	in
accordance	with	our	revenue	recognition	policy.	The	SPEs’	assets	and	cash	flows	are	not	available	to	our	other	creditors,	and	the	creditors	of	the	SPEs,
including	the	Solar	Asset-backed	Note	holders,	have	no	recourse	to	our	other	assets.	We	contracted	with	the	SPEs	to	provide	operations	&	maintenance
and	administrative	services	for	the	solar	energy	systems.	As	of	December	31,	2019,	solar	assets	pledged	as	collateral	for	Solar	Asset-backed	Notes	had
a	carrying	value	of	$
690
	million	and	are	included	within	solar	energy	systems,	net,	on	the	consolidated	balance	sheets.
	
China	Loan	Agreements
In	March	2019,	one	of	our	subsidiaries	entered	into	a	loan	agreement	with	a	syndicate	of	lenders	in	China	for	a	bridge	loan	to	be	used	for


key: chroma:document
string_value:
expenditures	related	to	the	construction	of	and	production	at	our	Gigafactory	Shanghai.	The	loan	agreement	was	terminated	in	December	2019.	
	
		
In	September	2019,	one	of	our	subsidiaries	entered	into	a	loan	agreement	with	a	lender	in	China	for	an	unsecured	12-month	revolving	facility	of
up	to	RMB	
5.0
	billion	(or	the	equivalent	drawn	in	U.S.	dollars),	to	
finance	vehicles	in-transit	to	China
.	Borrowed	funds	bear	interest	at	an	annual	rate	no
greater	than	
90
%	of	the	one-year	rate	published	by	the	People’s	Bank	of	China.	The	loan	facility	is	non-recourse	to	our	assets.
In	December	2019,	one	of	our	subsidiaries	entered	into	loan	agreements	with	a	syndicate	of	lenders	in	China	for:	(i)	a	secured	term	loan	facility
of	up	to	RMB	
9.0
	billion	or	the	equivalent	amount	drawn	in	U.S.	dollars	(the	“Fixed	Asset	Facility”)	and	(ii)	an	unsecured	revolving	loan	facility	of	up	to
RMB	
2.25
	billion	or	the	equivalent	amount	drawn	in	U.S.	dollars	(the	“Working	Capital	Facility”),	in	each	case	to	be	used	in	connection	with	our
construction	of	and	production	at	our	Gigafactory	Shanghai.	
Outstanding	borrowings	pursuant	to	the	Fixed	Asset	Facility	accrue	interest	at	a	rate	equal
to:	(i)	for	RMB-denominated	loans,	the	market	quoted	interest	rate	published	by	the	People’s	Bank	of	China	minus	
0.7625
%,	and	
(ii)	for	U.S.	dollar-
denominated	loans,	the	sum	of	one-year	LIBOR	plus	
1.3
%


key: chroma:document
string_value:
1.3
%
.	Outstanding	borrowings	pursuant	to	the	Working	Capital	Facility	accrue	interest	at	a	rate
equal	to:	(i)	for	RMB-denominated	loans,	the	market	quoted	interest	rate	published	by	the	People’s	Bank	of	China	minus	
0.4525
%,	and	
(ii)	for	U.S.
dollar-denominated	loans,	the	sum	of	one-year	LIBOR	plus	
0.8
%.	
The	Fixed	Asset	Facility	is	secured	by	the	land	and	buildings	at	Gigafactory	Shanghai
and	both	facilities	are	non-recourse	to	our	other	assets.
Cash	Equity	Debt
In	connection	with	the	cash	equity	financing	deals	closed	in	2016,	our	subsidiaries	issued	$
502
	million	in	aggregate	principal	amount	of	debt
that	bears	interest	at	fixed	rates.	This	debt	is	secured	by,	among	other	things,	our	interests	in	certain	financing	funds	and	is	non-recourse	to	our	other
assets.
Solar	Loan-backed	Notes
In	January	2016	and	January	2017,	our	subsidiaries	pooled	and	transferred	certain	MyPower	customer	notes	receivable	into	two	SPEs	and
issued	$
330
	million	in	aggregate	principal	amount	of	Solar	Loan-backed	Notes,	backed	by	these	notes	receivable	to	investors.	
Accordingly,	we	did	not
recognize	a	gain	or	loss	on	the	transfer	of	these	notes	receivable.	
The	SPEs	are	wholly	owned	by	us	and	are	consolidated	in	the	financial	statements.
The	payments	received	by	the	SPEs	from	these	notes	receivable	are	used	to	service	the	semi-annual	principal	and	interest	payments	on	the	Solar	Loan-


key: chroma:document
string_value:
backed	Notes	and	satisfy	the	SPEs’	expenses,	and	any	remaining	cash	is	distributed	to	us.	The	SPEs’	assets	and	cash	flows	are	not	available	to	our	other
creditors,	and	the	creditors	of	the	SPEs,	including	the	Solar	Loan-backed	Note	holders,	have	no	recourse	to	our	other	assets.
103


key: chroma:document
string_value:
Warehouse	Agreements
In	August	2016,	our	subsidiaries	entered	into	a	loan	and	security	agreement	(the	“2016	Warehouse	Agreement”)	for	borrowings	secured	by	the
future	cash	flows	arising	from	certain	leases	and	the	associated	leased	vehicles.	On	August	17,	2017,	the	2016	Warehouse	Agreement	was	amended	to
modify	the	interest	rates	and	extend	the	availability	period	and	the	maturity	date,	and	our	subsidiaries	entered	into	another	loan	and	security
agreement	(the	“2017	Warehouse	Agreement”)	with	substantially	the	same	terms	as	and	that	shares	the	same	committed	amount	with	the	2016
Warehouse	Agreement.	On	August	16,	2018,	the	2016	Warehouse	Agreement	and	2017	Warehouse	Agreement	were	amended	to	extend	the	availability
period	from	August	17,	2018	to	August	16,	2019	and	extend	the	maturity	date	from	September	2019	to	
September	2020
.	On	December	28,	2018,	our
subsidiaries	terminated	the	2017	Warehouse	Agreement	after	having	fully	repaid	all	obligations	thereunder,	and	entered	into	a	third	loan	and	security
agreement	with	substantially	the	same	terms	as	and	that	shares	the	same	committed	amount	with	the	2016	Warehouse	Agreement.	We	refer	to	these
agreements	together	as	the	“Warehouse	Agreements.”	Amounts	drawn	under	the	Warehouse	Agreements	generally	bear	interest	at	a	fixed	margin
above	(i)	LIBOR	or	(ii)	the	commercial	paper	rate.	The	Warehouse	Agreements	are	non-recourse	to	our	other	assets.
Pursuant	to	the	Warehouse	Agreements,	an	undivided	beneficial	interest	in	the	future	cash	flows	arising	from	certain	leases	and	the	related


key: chroma:document
string_value:
leased	vehicles	has	been	sold	for	legal	purposes	but	continues	to	be	reported	in	the	consolidated	financial	statements.	The	interest	in	the	future	cash
flows	arising	from	these	leases	and	the	related	vehicles	is	not	available	to	pay	the	claims	of	our	creditors	other	than	pursuant	to	obligations	to	the
lenders	under	the	Warehouse	Agreements.
	
Any	excess	cash	flows	not	required	to	pay	obligations	under	the	Warehouse	Agreements	are	available	for
distributions.
In	August	2019,	our	subsidiaries	amended	the	Warehouse	Agreements	to	extend	the	availability	period	from	August	16,	2019	to	August	14,	2020
and	extend	the	maturity	date	from	September	2020	to	
September	2021
.
In	November	2019,	we	repaid	$
723
	million	of	the	principal	outstanding	under	the	Warehouse	Agreements.
Solar	Term	Loans
Our	subsidiaries	have	entered	into	agreements	for	term	loans	with	various	financial	institutions.	
The	term	loans	are	secured	by	substantially	all
of	the	assets	of	the	subsidiaries,	including	its	interests	in	certain	financing	funds,	and	are	non-recourse	to	our	other	assets.
During	the	fourth	quarter	of	2019,	we	fully	repaid	the	$
159
	million	in	aggregate	principal	of	one	term	loan.
Canada	Credit	Facility
In	December	2016,	one	of	our	subsidiaries	entered	into	a	credit	agreement	(the	“Canada	Credit	Facility”)	with	a	bank	for	borrowings	secured	by
our	interests	in	certain	vehicle	leases.	In	December	2017	and	December	2018,	the	Canada	Credit	Facility	was	amended	to	add	our	interests	in


key: chroma:document
string_value:
additional	vehicle	leases	as	collateral,	allowing	us	to	draw	additional	funds.	Amounts	drawn	under	the	Canada	Credit	Facility	bear	interest	at	fixed
rates.	The	Canada	Credit	Facility	is	non-recourse	to	our	other	assets.
Solar	Renewable	Energy	Credit	and	other	Loans
We	have	entered	into	various	solar	renewable	energy	credit	and	other	loan	agreements	with	various	financial	institutions,	including	a	solar
revolving	credit	facility.	The	solar	renewable	energy	credit	loan	facility	is	secured	by	substantially	all	of	the	assets	of	
one
	of	our	wholly	owned
subsidiaries,	including	its	rights	under	forward	contracts	to	sell	SRECs,	and	is	non-recourse	to	our	other	assets.	The	solar	revolving	credit	facility	is
secured	by	certain	assets	of	the	subsidiary	and	is	non-recourse	to	our	other	assets.
104


key: chroma:document
string_value:
Interest	Expense
The	following	table	presents	the	interest	expense	related	to	the	contractual	interest	coupon,	the	amortization	of	debt	issuance	costs	and	the
amortization	of	debt	discounts	on	our	convertible	senior	notes	with	cash	conversion	features,	which	include	the	1.50%	Convertible	Senior	Notes	due	in
2018,	the	2019	Notes,	the	2021	Notes,	the	2022	Notes	and	the	2024	Notes	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Contractual	interest	coupon
	
$
65
	
	
$
43
	
	
$
39
	
Amortization	of	debt	issuance	costs
	
	
7
	
	
	
7
	
	
	
7
	
Amortization	of	debt	discounts
	
	
148
	
	
	
123
	
	
	
114
	
Total
	
$
220
	
	
$
173
	
	
$
160
	
Pledged	Assets
As	of	December	31,	2019	and	2018,	we	had	pledged	or	restricted	
$
5.72
	billion	and	$
5.23
	billion	of	our	assets	(consisted	principally	of	restricted
cash,	receivables,	inventory,	SRECs,	solar	energy	systems,	operating	lease	vehicles,	land	use	rights,	property	and	equipment,	and	equity	interests	in
certain	SPEs)	as	collateral	for	our	outstanding	debt.
Schedule	of	Principal	Maturities	of	Debt
The	future	scheduled	principal	maturities	of	debt	as	of	December	31,	2019	were	as	follows	(in	millions):
	
	
	
Recourse	debt
	
	
Non-recourse	debt
	
	
Total
	
2020


key: chroma:document
string_value:
Total
	
2020
	
$
259
	
	
$
1,155
	
	
$
1,414
	
2021
	
	
1,382
	
	
	
909
	
	
	
2,291
	
2022
	
	
1,024
	
	
	
1,013
	
	
	
2,037
	
2023
	
	
1,586
	
	
	
199
	
	
	
1,785
	
2024
	
	
1,840
	
	
	
558
	
	
	
2,398
	
Thereafter
	
	
1,807
	
	
	
760
	
	
	
2,567
	
Total
	
$
7,898
	
	
$
4,594
	
	
$
12,492
	
Note	13	–	Leases
We	have	entered	into	various	non-cancellable	operating	and	finance	lease	agreements	for	certain	of	our	offices,	manufacturing	and	warehouse
facilities,	retail	and	service	locations,	equipment,	vehicles,	and	solar	energy	systems,	worldwide.	We	determine	if	an	arrangement	is	a	lease,	or	contains
a	lease,	at	inception	and	record	the	leases	in	our	financial	statements	upon	lease	commencement,	which	is	the	date	when	the	underlying	asset	is	made
available	for	use	by	the	lessor.
Our	leases,	where	we	are	the	lessee,	often	include	options	to	extend	the	lease	term	for	up	to	
10
	years
.	Some	of	our	leases	also	include	options	to
terminate	the	lease	prior	to	the	end	of	the	agreed	upon	lease	term.	For	purposes	of	calculating	lease	liabilities,	lease	terms	include	options	to	extend	or
terminate	the	lease	when	it	is	reasonably	certain	that	we	will	exercise	such	options.


key: chroma:document
string_value:
Lease	expense	for	operating	lease	payments	is	recognized	on	a	straight-line	basis	over	the	lease	term.	Certain	operating	leases	provide	for
annual	increases	to	lease	payments	based	on	an	index	or	rate.	We	calculate	the	present	value	of	future	lease	payments	based	on	the	index	or	rate	at	the
lease	commencement	date	for	new	leases	commencing	after	January	1,	2019.	For	historical	leases,	we	used	the	index	or	rate	as	of	the	adoption	date.
Differences	between	the	calculated	lease	payment	and	actual	payment	are	expensed	as	incurred.	Lease	expense	for	finance	lease	payments	is
recognized	as	amortization	expense	of	the	finance	lease	ROU	asset	and	interest	expense	on	the	finance	lease	liability	over	the	lease	term.
105


key: chroma:document
string_value:
The	balances	for	the	operating	and	finance	leases	where	we	are	the	lessee	are	presented	as	follows	(in	millions)	within	our	consolidated	balance
sheet:
	
	
	
December	31,	2019
	
Operating	leases:
	
	
	
	
Operating	lease	right-of-use	assets
	
$
1,218
	
	
	
	
	
	
Accrued	liabilities	and	other
	
$
228
	
Other	long-term	liabilities
	
	
956
	
Total	operating	lease	liabilities
	
$
1,184
	
	
	
	
	
	
Finance	leases:
	
	
	
	
Solar	energy	systems,	net
	
$
30
	
Property,	plant	and	equipment,	net
	
	
1,600
	
Total	finance	lease	assets
	
$
1,630
	
	
	
	
	
	
Current	portion	of	long-term	debt	and	finance	leases
	
$
386
	
Long-term	debt	and	finance	leases,	net	of	current	portion
	
	
1,232
	
Total	finance	lease	liabilities
	
$
1,618
	
The	components	of	lease	expense	are	as	follows	(in	millions)	within	our	consolidated	statements	of	operations:
	
	
	
Year		Ended
	
	
	
December	31,	2019
	
Operating	lease	expense:
	
	
	
	
Operating	lease	expense	(1)
	
$
426
	
	
	
	
	
	
Finance	lease	expense:
	
	
	
	
Amortization	of	leased	assets
	
$
299
	
Interest	on	lease	liabilities
	
	
104
	
Total	finance	lease	expense
	
$
403
	
	
	
	
	
	
Total	lease	expense
	
$
829


key: chroma:document
string_value:
Total	lease	expense
	
$
829
	
(1)
Includes	short-term	leases	and	variable	lease	costs,	which	are	immaterial.
Other	information	related	to	leases	where	we	are	the	lessee	is	as	follows:
	
	
	
December	31,	2019
	
Weighted-average	remaining	lease	term:
	
	
	
	
Operating	leases
	
6.2
	years
	
Finance	leases
	
3.9
	years
	
	
	
	
	
	
Weighted-average	discount	rate:
	
	
	
	
Operating	leases
	
	
6.5
%
Finance	leases
	
	
6.5
%
	
106


key: chroma:document
string_value:
Because	most	of	our	leases	do	not	provide	an	implicit	rate	of	return,	we	used	our	incremental	borrowing	rate	based	on	the	information	available
at	lease	commencement	date	in	determining	the	present	value	of	lease	payments.
Supplemental	cash	flow	information	related	to	leases	where	we	are	the	lessee	is	as	follows	
(in	millions)
:
	
	
	
Year	Ended
	
	
	
December	31,	2019
	
Cash	paid	for	amounts	included	in	the	measurement	of	lease	liabilities:
	
	
	
	
Operating	cash	outflows	from	operating	leases
	
$
396
	
Operating	cash	outflows	from	finance	leases	(interest	payments)
	
$
104
	
Financing	cash	outflows	from	finance	leases
	
$
321
	
Leased	assets	obtained	in	exchange	for	finance	lease	liabilities
	
$
616
	
Leased	assets	obtained	in	exchange	for	operating	lease	liabilities
	
$
202
	
As	of	
December	31,	2019
,	the	maturities	of	our	operating	and	finance	lease	liabilities	(excluding	short-term	leases)	are	as	follows
	(in	millions):
	
	
	
Operating
	
	
Finance
	
	
	
Leases
	
	
Leases
	
2020
	
$
296
	
	
$
474
	
2021
	
	
262
	
	
	
478
	
2022
	
	
210
	
	
	
600
	
2023
	
	
174
	
	
	
224
	
2024
	
	
146
	
	
	
5
	
Thereafter
	
	
372
	
	
	
13
	
Total	minimum	lease	payments
	
	
1,460
	
	
	
1,794


key: chroma:document
string_value:
1,460
	
	
	
1,794
	
Less:	Interest
	
	
276
	
	
	
176
	
Present	value	of	lease	obligations
	
	
1,184
	
	
	
1,618
	
Less:	Current	portion
	
	
228
	
	
	
386
	
Long-term	portion	of	lease	obligations
	
$
956
	
	
$
1,232
	
Under	legacy	lease	accounting	(ASC	840),	future	minimum	lease	payments	under	non-cancellable	leases	as	of	December	31,	2018	are	as	follows
(in	millions):
	
	
	
Operating
	
	
Finance
	
	
	
Leases
	
	
Leases
	
2019
	
$
276
	
	
$
417
	
2020
	
	
257
	
	
	
503
	
2021
	
	
230
	
	
	
506
	
2022
	
	
183
	
	
	
24
	
2023
	
	
158
	
	
	
5
	
Thereafter
	
	
524
	
	
	
6
	
Total	minimum	lease	payments
	
$
1,628
	
	
	
1,461
	
Less:	Interest
	
	
	
	
	
	
122
	
Present	value	of	lease	obligations
	
	
	
	
	
	
1,339
	
Less:	Current	portion
	
	
	
	
	
	
346
	
Long-term	portion	of	lease	obligations
	
	
	
	
	
$
993
	
107


key: chroma:document
string_value:
Non-cancellable	Operating	Lease	Receivables
Under	the	new	lease	standard,	we	are	the	lessor	of	certain	vehicle	arrangements	as	described	in	Note	2,	
Summary	of	Significant	Accounting
Policies
.	
Following	the	adoption	of	the	new	lease	standard,	solar	energy	system	leases	and	PPAs	that	commenced	after	January	1,	2019,	where	we	are
the	lessor	and	were	previously	accounted	for	as	leases,	no	longer	meet	the	definition	of	a	lease	and	are	therefore	not	included	in	the	table	as	of
December	31,	2019	(refer	to	Note	2,	
Summary	of	Significant	Accounting	Policies
).	
As	of	December	31,	2019,	maturities	of	our	operating	lease
receivables	from	customers	for	each	of	the	next	five	years	and	thereafter	were	as	follows	(in	millions):
	
2020
	
$
644
	
2021
	
	
494
	
2022
	
	
317
	
2023
	
	
190
	
2024
	
	
191
	
Thereafter
	
	
2,294
	
Total
	
$
4,130
	
U
nder	legacy	lease	accounting	(ASC	840),	future	minimum	lease	payments	to	be	received	from	customers	under	non-cancellable	leases	as	of
December	31,	2018	are	as	follows	(in	millions):
	
2019
	
$
502
	
2020
	
	
418
	
2021
	
	
271
	
2022
	
	
187
	
2023
	
	
189
	
Thereafter
	
	
2,469
	
Total
	
$
4,036
	
The	above	tables	do	not	include	vehicle	sales	to	customers	or	leasing	partners	with	a	resale	value	guarantee	as	the	cash	payments	were


key: chroma:document
string_value:
received	upfront.	For	our	solar	PPA	arrangements,	customers	are	charged	solely	based	on	actual	power	produced	by	the	installed	solar	energy	system
at	a	predefined	rate	per	kilowatt-hour	of	power	produced.	The	future	payments	from	such	arrangements	are	not	included	in	the	above	table	as	they	are
a	function	of	the	power	generated	by	the	related	solar	energy	systems	in	the	future.
	
Note	14	–	Equity	Incentive	Plans
In	June	2019,	we	adopted	the	2019	Equity	Incentive	Plan	(the	“2019	Plan”),	and	simultaneously	terminated	the	2010	Equity	Incentive	Plan	(the
“2010	Plan”).	
No
	new	awards	have	been	granted	under	the	2010	Plan	following	the	adoption	of	the	2019	Plan,	but	such	termination	did	not	affect
outstanding	awards	under	the	2010	Plan.	The	2019	Plan	has	similar	terms	as	the	2010	Plan	and	provides	for	the	granting	of	stock	options,	restricted
stock,	RSUs,	stock	appreciation	rights,	performance	units	and	performance	shares	to	our	employees,	directors	and	consultants.	Stock	options	granted
under	the	2019	Plan	may	be	either	incentive	stock	options	or	nonstatutory	stock	options.	Incentive	stock	options	may	only	be	granted	to	our	employees.
Nonstatutory	stock	options	may	be	granted	to	our	employees,	directors	and	consultants.	Generally,	our	stock	options	and	RSUs	vest	over	
four	years
	and
our	stock	options	are	exercisable	over	a	maximum	period	of	
10
	years	from	their	grant	dates.	Vesting	typically	terminates	when	the	employment	or
consulting	relationship	ends.
As	of	December	31,	2019,	
11


key: chroma:document
string_value:
As	of	December	31,	2019,	
11
	million	shares	were	reserved	and	available	for	issuance	under	the	2019	Plan.
108


key: chroma:document
string_value:
The	following	table	summarizes	our	stock	option	and	RSU	activity:
	
	
	
Stock	Options
	
	
RSUs
	
	
	
	
	
	
	
	
	
	
	
Weighted-
	
	
	
	
	
	
	
	
	
Weighted-
	
	
	
	
	
	
	
Weighted-
	
	
Average
	
Aggregate
	
	
	
	
	
	
Average
	
	
	
Number	of
	
	
Average
	
	
Remaining
	
Intrinsic
	
	
Number
	
	
Grant
	
	
	
Options
	
	
Exercise
	
	
Contractual
	
Value
	
	
of	RSUs
	
	
Date	Fair
	
	
	
(in
	
thousands)
	
	
Price
	
	
Life	(years)
	
(in	billions)
	
	
(in
	
thousands)
	
	
Value
	
Balance,
			December	31,	2018
	
	
31,208
	
	
$
273.40
	
	
	
	
	
	
	
	
	
4,659
	
	
$
294.63
	
Granted
	
	
1,473
	
	
$
265.26
	
	
	
	
	
	
	
	
	
3,752
	
	
$
282.74
	
Exercised	or	released
	
	
(
1,441
)
	
$
106.68
	
	
	
	
	
	
	
	
	
(
1,949
)
	
$
277.13
	
Cancelled
	
	
(
1,245
)
	
$
310.57
	
	
	
	
	
	
	
	
	
(
1,656
)
	
$
295.05
	
Balance,
			December


key: chroma:document
string_value:
$
295.05
	
Balance,
			December
	
31,
	
2019
	
	
29,995
	
	
$
279.49
	
	
6.89
	
$
4.17
	
	
	
4,806
	
	
$
291.06
	
Vested	and
			expected
	
to
	
vest,
			December	31,	2019
	
	
15,860
	
	
$
228.29
	
	
6.05
	
$
3.02
	
	
	
4,804
	
	
$
291.05
	
Exercisable	and	vested,
			December	31,	2019
	
	
7,025
	
	
$
94.07
	
	
3.39
	
$
2.28
	
	
	
	
	
	
	
	
	
The	weighted-average	grant	date	fair	value	of	RSUs	in	the	years	ended	December	31,	2019,	2018,	and	2017	was	$
282.74
,	$
316.46
	and	$
308.71
,
respectively.	The	aggregate	release	date	fair	value	of	RSUs	in	the	years	ended	December	31,	2019,	2018	and	2017	was	$
502
	million,	$
546
	million	and
$
491
	million,	respectively.
The	aggregate	intrinsic	value	of	options	exercised	in	the	years	ended	December	31,	2019,	2018,	and	2017	was	$
237
	million,	$
293
	million	and
$
544
	million,	respectively.
Fair	Value	Assumptions
We	use	the	fair	value	method	in	recognizing	stock-based	compensation	expense.	Under	the	fair	value	method,	we	estimate	the	fair	value	of	each


key: chroma:document
string_value:
stock	option	award	with	service	or	service	and	performance	conditions	and	the	ESPP	on	the	grant	date	generally	using	the	Black-Scholes	option	pricing
model	and	the	weighted-average	assumptions	in	the	following	table:
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Risk-free	interest	rate:
	
	
	
	
	
	
	
	
	
	
	
	
Stock	options
	
	
2.4
%
	
	
2.5
%
	
	
1.8
%
ESPP
	
	
2.2
%
	
	
2.0
%
	
	
1.1
%
Expected	term	(in	years):
	
	
	
	
	
	
	
	
	
	
	
	
Stock	options
	
	
4.5
	
	
	
4.7
	
	
	
5.1
	
ESPP
	
	
0.5
	
	
	
0.5
	
	
	
0.5
	
Expected	volatility:
	
	
	
	
	
	
	
	
	
	
	
	
Stock	options
	
	
48
%
	
	
42
%
	
	
42
%
ESPP
	
	
53
%
	
	
43
%
	
	
35
%
Dividend	yield:
	
	
	
	
	
	
	
	
	
	
	
	
Stock	options
	
	
0.0
%
	
	
0.0
%
	
	
0.0
%
ESPP
	
	
0.0
%
	
	
0.0
%
	
	
0.0
%
Grant	date	fair	value	per	share:
	
	
	
	
	
	
	
	
	
	
	
	
Stock	options


key: chroma:document
string_value:
The	fair	value	of	RSUs	with	service	or	service	and	performance	conditions	is	measured	on	the	grant	date	based	on	the	closing	fair	market	value
of	our	common	stock.	The	risk-free	interest	rate	is	based	on	the	U.S.	Treasury	yield	for	zero-coupon	U.S.	Treasury	notes	with	maturities	approximating
each	grant’s	expected	life.	Prior	to	the	fourth	quarter	of	2017,	given	our	then	limited	history	with	employee	grants,	we	used	the	“simplified”	method	in
estimating	the	expected	term	of	our	employee	grants;	the	simplified	method	utilizes	the	average	of	the	time-to-vesting	and	the	contractual	life	of	the
employee	grant.	Beginning	with	the	fourth	quarter	of	2017,	we	use	our	historical	data	in	estimating	the	expected	term	of	our	employee	grants.	The
expected	volatility	is	based	on	the	average	of	the	implied	volatility	of	publicly	traded	options	for	our	common	stock	and	the	historical	volatility	of	our
common	stock.
2018	CEO	Performance	Award
In	March	2018,	our	stockholders	approved	the	Board	of	Directors’	grant	of	
20,264,042
	stock	option	awards	to	our	CEO	(the	“2018	CEO
Performance	Award”).	The	2018	CEO	Performance	Award	consists	of	
12
	vesting	tranches	with	a	vesting	schedule	based	entirely	on	the	attainment	of
both	operational	milestones	(performance	conditions)	and	market	conditions,	assuming	continued	employment	either	as	the	CEO	or	as	both	Executive
Chairman	and	Chief	Product	Officer	and	service	through	each	vesting	date.	
Each	of	the	12	vesting	tranches	of	the	2018	CEO	Performance	Award	will
vest	upon	certification	by	the	Board	of	Directors	that	both	(i)	the	market	capitalization	milestone	for	such	tranche,	which	begins	at	$
100
	billion	for	the


key: chroma:document
string_value:
100
	billion	for	the
first	tranche	and	increases	by	increments	of	$
50
	billion	thereafter,	and	(ii)	any	one	of	the	following	
eight
	operational	milestones	focused	on	revenue	or
eight
	operational	milestones	focused	on	Adjusted	EBITDA	have	been	met	for	the	previous	four	consecutive	fiscal	quarters	on	an	annualized	basis.
Adjusted	EBITDA	is	defined	as	net	income	(loss)	attributable	to	common	stockholders	before	interest	expense,	provision	(benefit)	for	income	taxes,
depreciation	and	amortization	and	stock-based	compensation.
	
Total	Annualized	Revenue
(in	billions)
	
Annualized	Adjusted	EBITDA
(in	billions)
$
20.0
	
$
1.5
$
35.0
	
$
3.0
$
55.0
	
$
4.5
$
75.0
	
$
6.0
$
100.0
	
$
8.0
$
125.0
	
$
10.0
$
150.0
	
$
12.0
$	
175.0
	
$
14.0
	
As	of	December	31,	2019,	
two
	operational	milestones	have	been	achieved:	(i)	$
20.0
	billion	total	annualized	revenue	and	(ii)	$
1.5
	billion
annualized	adjusted	EBITDA,	each	subject	to	the	formal	certification	by	our	Board	of	Directors,	while	no	market	capitalization	milestones	have	been
achieved.	Consequently,	no	shares	subject	to	the	2018	CEO	Performance	Award	have	vested	as	of	the	date	of	this	filing.
	
As	of	December	31,	2019,	the	following	operational	milestones	were	considered	probable	of	achievement:
	
•
Adjusted	EBITDA	of	$
3.0
	billion


key: chroma:document
string_value:
3.0
	billion
	
•
Total	revenue	of	$
35.0
	billion
Stock-based	compensation	expense	associated	with	each	tranche	under	the	2018	CEO	Performance	Award	is	recognized	over	the	longer	of	(i)
the	expected	achievement	period	for	the	operational	milestone	for	such	tranche	and	(ii)	the	expected	achievement	period	for	the	related	market
capitalization	milestone	determined	on	the	grant	date,	beginning	at	the	point	in	time	when	the	relevant	operational	milestone	is	considered	probable	of
being	met.	If	such	operational	milestone	becomes	probable	any	time	after	the	grant	date,	we	will	recognize	a	cumulative	catch-up	expense	from	the
grant	date	to	that	point	in	time.	If	the	related	market	capitalization	milestone	is	achieved	earlier	than	its	expected	achievement	period	and	the
achievement	of	the	related	operational	milestone,	then	the	stock-based	compensation	expense	will	be	recognized	over	the	expected	achievement	period
for	the	operational	milestone,	which	may	accelerate	the	rate	at	which	such	expense	is	recognized.
110


key: chroma:document
string_value:
The	market	capitalization	milestone	period	and	the	valuation	of	each	tranche	are	determined	using	a	Monte	Carlo	simulation	and	is	used	as	the
basis	for	determining	the	expected	achievement	period.	The	probability	of	meeting	an	operational	milestone	is	based	on	a	subjective	assessment	of	our
future	financial	projections.	
No
	tranches	of	the	2018	CEO	Performance	Award
	will
	vest	unless	a	market	capitalization	and	a	matching	operational
milestone	are	both	achieved.	
The	first	tranche	of	the	2018	CEO	Performance	Award	will	not	vest	unless	our	market	capitalization	were	to	approximately
double	from	the	initial	level	at	the	time	the	award	was	approved,	based	on	both	a	six	calendar	month	trailing	average	and	a	30	calendar	day	trailing
average	(counting	only	trading	days).	
Upon	vesting	of	a	tranche,	all	unamortized	expense	for	the	tranche	will	be	recognized	immediately.	
Additionally,
stock-based	compensation	represents	a	non-cash	expense	and	is	recorded	as	a	selling,	general,	and	administrative	operating	expense	in	our
consolidated	statement	of	operations.
As	of	December	31,	2019,	we	had	$
527
	million	of	total	unrecognized	stock-based	compensation	expense	for	the	operational	milestones	that
were	considered	probable	of	achievement,	which	will	be	recognized	over	a	weighted-average	period	of	
2.72
	years.	As	of	December	31,	2019,	we	had
unrecognized	stock-based	compensation	expense	of	$
1.29
	billion	for	the	operational	milestones	that	were	considered	not	probable	of	achievement.	For
the	year	ended	December	31,	2019,	we	recorded	stock-based	compensation	expense	of	$
296
	million	related	to	the	2018	CEO	Performance	Award.	From


key: chroma:document
string_value:
March	21,	2018,	when	the	grant	was	approved	by	our	stockholders,	through	December	31,	2018,	we	recorded	stock-based	compensation	expense	of
$
175
	million	related	to	this	award.	The	increase	in	stock-based	compensation	expense	was	primarily	related	to	a	$72	million	cumulative	catch-up
expense	for	the	service	provided	from	the	grant	date	when	an	additional	operational	milestone	was	considered	probable	of	being	met	in	the	fourth
quarter	of	2019	and	a	shorter	expense	period	in	the	prior	year.
2014	Performance-Based	Stock	Option	Awards
In	2014,	to	create	incentives	for	continued	long-term	success	beyond	the	Model	S	program	and	to	closely	align	executive	pay	with	our
stockholders’	interests	in	the	achievement	of	significant	milestones	by	us,	the	Compensation	Committee	of	our	Board	of	Directors	granted	stock	option
awards	to	certain	employees	(excluding	our	CEO)	to	purchase	an	aggregate	of	
1,073,000
	shares	of	our	common	stock.	Each	award	consisted	of	the
following	
four
	vesting	tranches	with	the	vesting	schedule	based	entirely	on	the	attainment	of	the	future	performance	milestones,	assuming	continued
employment	and	service	through	each	vesting	date:
	
•
1/4
th	of	each	award	vests	upon	completion	of	the	first	Model	X	production	vehicle;
	
•
1/4th
	of	each	award	vests	upon	achieving	aggregate	production	of	
100,000
	vehicles	in	a	trailing	12-month	period;
	
•
1/4th
	of	each	award	vests	upon	completion	of	the	first	Model	3	production	vehicle;	and
	
•
1/4th
	of	each	award	vests	upon	achieving	an	annualized	gross	margin	of	greater	than	
30
%	for	any	three-year	period.


key: chroma:document
string_value:
30
%	for	any	three-year	period.
As	of	December	31,	2019,	the	following	performance	milestones	had	been	achieved:
	
•
Completion	of	the	first	Model	X	production	vehicle;
	
•
Completion	of	the	first	Model	3	production	vehicle;	and
	
•
Aggregate	production	of	
100,000
	vehicles	in	a	trailing	12-month	period.
We	begin	recognizing	stock-based	compensation	expense	as	each	performance	milestone	becomes	probable	of	achievement.	As	of	December	31,
2019,	we	had	unrecognized	stock-based	compensation	expense	of	$
5
	million	for	the	performance	milestone	that	was	considered	not	probable	of
achievement.	For	the	years	ended	December	31,	2019	and	2018,	we	did	
no
t	record	any	additional	stock-based	compensation	related	to	these	awards.
For	the	year	ended	December	2017,	we	recorded	stock-based	compensation	expense	of	$
7
	million	related	to	these	awards.
111


key: chroma:document
string_value:
2012	CEO	Performance	Award
In	August	2012,	our	Board	of	Directors	granted	
5,274,901
	stock	option	awards	to	our	CEO	(the	“2012	CEO	Performance	Award”).	The	2012
CEO	Performance	Award	consists	of	
10
	vesting	tranches	with	a	vesting	schedule	based	entirely	on	the	attainment	of	both	performance	conditions	and
market	conditions,	assuming	continued	employment	and	service	through	each	vesting	date.	Each	vesting	tranche	requires	a	combination	of	a	pre-
determined	performance	milestone	and	an	incremental	increase	in	our	market	capitalization	of	$
4.00
	billion,	as	compared	to	our	initial	market
capitalization	of	$
3.20
	billion	at	the	time	of	grant.	As	of	
December	31,	2019
,	the	market	capitalization	conditions	for	all	of	the	vesting	tranches	and	the
following	performance	milestones	had	been	achieved:
	
•
Successful	completion	of	the	Model	X	alpha	prototype;
	
•
Successful	completion	of	the	Model	X	beta	prototype;
	
•
Completion	of	the	first	Model	X	production	vehicle;
	
•
Aggregate	production	of	
100,000
	vehicles;
	
•
Successful	completion	of	the	Model	3	alpha	prototype;
	
•
Successful	completion	of	the	Model	3	beta	prototype;
	
•
Completion	of	the	first	Model	3	production	vehicle;
	
•
Aggregate	production	of	
200,000
	vehicles;	and
	
•
Aggregate	production	of	
300,000
	vehicles.
We	begin	recognizing	stock-based	compensation	expense	as	each	milestone	becomes	probable	of	achievement.	As	of	December	31,	2019,	we
had	unrecognized	stock-based	compensation	expense	of	$
6
	million	for	the	performance	milestone	that	was	considered	not	probable	of	achievement.	For


key: chroma:document
string_value:
the	year	ended	December	31,	2019,	we	recorded	
no
	stock-based	compensation	expense	related	to	the	2012	CEO	Performance	Award.	For	the	year
ended	December	31,	2018,	the	stock-based	compensation	we	recorded	related	to	this	award	was	immaterial.	For	the	year	ended	December	31,	2017,	we
recorded	stock-based	compensation	expense	of	$
5
	million	related	to	this	award.
Our
	CEO	
earns	a	base	salary	that	reflects	the	currently	applicable	minimum	wage	requirements	under	California	law,	and	he	is	subject	to
income	taxes	based	on	such	base	salary.	However,	he	has	never	accepted	
his
	salary.	Commencing	in	May	2019	at	our	CEO’s	request,	we	eliminated
altogether	the	earning	and	accrual	of	his	base	salary.
Summary	Stock-Based	Compensation	Information
The	following	table	summarizes	our	stock-based	compensation	expense	by	line	item	in	the	consolidated	statements	of	operations	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Cost	of	revenues
	
$
128
	
	
$
109
	
	
$
64
	
Research	and	development
	
	
285
	
	
	
261
	
	
	
218
	
Selling,	general	and	administrative
	
	
482
	
	
	
375
	
	
	
185
	
Restructuring	and	other
	
	
3
	
	
	
4
	
	
	
—
	
Total
	
$
898
	
	
$
749
	
	
$
467
	
We	realized	
no


key: chroma:document
string_value:
$
467
	
We	realized	
no
	income	tax	benefit	from	stock	option	exercises	in	each	of	the	periods	presented	due	to	cumulative	losses	and	valuation
allowances.	
As	of	December	31,	2019,	we	had	$
1.57
	billion	of	total	unrecognized	stock-based	compensation	expense	related	to	non-performance
awards,	which	will	be	recognized	over	a	weighted-average	period	of	
2.91
	years.
112


key: chroma:document
string_value:
ESPP
Our	employees	are	eligible	to	purchase	our	common	stock	through	payroll	deductions	of	up	to	
15
%	of	their	eligible	compensation,	subject	to	any
plan	limitations.	The	purchase	price	would	be	
85
%	of	the	lower	of	the	fair	market	value	on	the	first	and	last	trading	days	of	each	six-month	offering
period.	During	the	years	ended	December	31,	2019,	2018	and	2017,	we	issued	
0.5
	million,	
0.4
	million	and	
0.4
	million	shares	under	the	ESPP	with	an
associated	expense	of	$
40
	million,	$
109
	million	and	$
71
	million,	respectively.	There	were	
7
	million	shares	available	for	issuance	under	the	ESPP	as	of
December	31,	2019.
	
	
Note	15	–	Income	Taxes
A	provision	for	income	taxes	of	$
110
	million,	$
58
	million	and	$
32
	million	has	been	recognized	for	the	years	ended	December	31,	2019,	2018	and
2017,	respectively,	related	primarily	to	our	subsidiaries	located	outside	of	the	U.S.	Our	loss	before	provision	for	income	taxes	for	the	years	ended
December	31,	2019,	2018	and	2017	was	as	follows	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Domestic
	
$
287
	
	
$
412
	
	
$
993
	
Noncontrolling	interest	and	redeemable
			noncontrolling	interest
	
	
(
87
)
	
	
87
	
	
	
279
	
Foreign
	
	
465
	
	
	
506


key: chroma:document
string_value:
465
	
	
	
506
	
	
	
937
	
Loss	before	income	taxes
	
$
665
	
	
$
1,005
	
	
$
2,209
	
The	components	of	the	provision	for	income	taxes	for	the	years	ended	December	31,	2019,	2018	and	2017	consisted	of	the	following	(in
millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Current:
	
	
	
	
	
	
	
	
	
	
	
	
Federal
	
$
—
	
	
$
(
1
)
	
$
(
10
)
State
	
	
5
	
	
	
3
	
	
	
2
	
Foreign
	
	
86
	
	
	
24
	
	
	
43
	
Total	current
	
	
91
	
	
	
26
	
	
	
35
	
Deferred:
	
	
	
	
	
	
	
	
	
	
	
	
Federal
	
	
(
4
)
	
	
—
	
	
	
—
	
State
	
	
—
	
	
	
—
	
	
	
—
	
Foreign
	
	
23
	
	
	
32
	
	
	
(
3
)
Total	deferred
	
	
19
	
	
	
32
	
	
	
(
3
)
Total	provision	for	income	taxes
	
$
110
	
	
$
58
	
	
$
32
	
On	December	22,	2017,	the	2017	Tax	Cuts	and	Jobs	Act	(“Tax	Act”)	was	enacted	into	law	making	significant	changes	to	the	Internal	Revenue


key: chroma:document
string_value:
Code.	Changes	include,	but	are	not	limited	to,	a	federal	corporate	tax	rate	decrease	from	
35
%	to	
21
%	for	tax	years	beginning	after	December	31,	2017,
the	transition	of	U.S.	international	taxation	from	a	worldwide	tax	system	to	a	territorial	system	and	a	one-time	transition	tax	on	the	mandatory	deemed
repatriation	of	foreign	earnings.	We	were	required	to	recognize	the	effect	of	the	tax	law	changes	in	the	period	of	enactment,	such	as	re-measuring	our
U.S.	deferred	tax	assets	and	liabilities	as	well	as	reassessing	the	net	realizability	of	our	deferred	tax	assets	and	liabilities.	The	Tax	Act	did	not	give	rise
to	any	material	impact	on	the	consolidated	balance	sheets	and	consolidated	statements	of	operations	due	to	our	historical	worldwide	loss	position	and
the	full	valuation	allowance	on	our	net	U.S.	deferred	tax	assets.
	
113


key: chroma:document
string_value:
Deferred	tax	assets	(liabilities)	as	of	December	31,	2019	and	2018	consisted	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Deferred	tax	assets:
	
	
	
	
	
	
	
	
Net	operating	loss	carry-forwards
	
$
1,846
	
	
$
1,760
	
Research	and	development	credits
	
	
486
	
	
	
377
	
Other	tax	credits
	
	
126
	
	
	
128
	
Deferred	revenue
	
	
301
	
	
	
156
	
Inventory	and	warranty	reserves
	
	
243
	
	
	
165
	
Stock-based	compensation
	
	
102
	
	
	
102
	
Operating	lease	right-of-use	liabilities
	
	
290
	
	
	
—
	
Accruals	and	others
	
	
16
	
	
	
28
	
Total	deferred	tax	assets
	
	
3,410
	
	
	
2,716
	
Valuation	allowance
	
	
(
1,956
)
	
	
(
1,806
)
Deferred	tax	assets,	net	of	valuation	allowance
	
	
1,454
	
	
	
910
	
Deferred	tax	liabilities:
	
	
	
	
	
	
	
	
Depreciation	and	amortization
	
	
(
1,185
)
	
	
(
861
)
Investment	in	certain	financing	funds
	
	
(
17
)
	
	
(
33
)
Operating	lease	right-of-use	assets
	
	
(
263
)
	
	
—
	
Other
	
	
(
24
)
	
	
(


key: chroma:document
string_value:
(
24
)
	
	
(
24
)
Total	deferred	tax	liabilities
	
	
(
1,489
)
	
	
(
918
)
Deferred	tax	liabilities,	net	of	valuation	allowance
			and	deferred	tax	assets
	
$
(
35
)
	
$
(
8
)
	
As	of	December	31,	2019,	we	recorded	a	valuation	allowance	of	$
1.96
	billion	for	the	portion	of	the	deferred	tax	asset	that	we	do	not	expect	to	be
realized.	The	valuation	allowance	on	our	net	deferred	taxes	increased	by	$
150
	million,	decreased	by	$
38
	million,	and	increased	by	$
821
	million	during
the	years	ended	December	31,	2019,	2018	and	2017,	respectively.	The	changes	in	valuation	allowance	are	primarily	due	to	additional	U.S.	deferred	tax
assets	and	liabilities	incurred	in	the	respective	year.	We	have	net	$
151
	million	of	deferred	tax	assets	in	foreign	jurisdictions,	which	management
believes	are	more-likely-than-not	to	be	fully	realized	given	the	expectation	of	future	earnings	in	these	jurisdictions.	We	continue	to	monitor	the
realizability	of	the	U.S.	deferred	tax	assets	taking	into	account	multiple	factors,	including	the	results	of	operations	and	magnitude	of	excess	tax
deductions	for	stock-based	compensation.	We	intend	to	continue	maintaining	a	full	valuation	allowance	on	our	U.S.	deferred	tax	assets	until	there	is
sufficient	evidence	to	support	the	reversal	of	all	or	some	portion	of	these	allowances.	Release	of	all,	or	a	portion,	of	the	valuation	allowance	would	result


key: chroma:document
string_value:
in	the	recognition	of	certain	deferred	tax	assets	and	a	decrease	to	income	tax	expense	for	the	period	the	release	is	recorded.
	
114


key: chroma:document
string_value:
The	reconciliation	of	taxes	at	the	federal	statutory	rate	to	our	provision	for	income	taxes	for	the	years	ended	December	31,	2019,	2018	and
2017	was	as	follows	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
	
2018
	
	
	
2017
	
Tax	at	statutory	federal	rate
	
$
(
139
)
	
	
$
(
211
)
	
	
$
(
773
)
State	tax,	net	of	federal	benefit
	
	
5
	
	
	
	
3
	
	
	
	
2
	
Nondeductible	expenses
	
	
94
	
	
	
	
65
	
	
	
	
30
	
Excess	tax	benefits	related	to	stock	based
			compensation	(1)
	
	
(
7
)
	
	
	
(
44
)
	
	
	
(
1,013
)
Foreign	income	rate	differential
	
	
189
	
	
	
	
161
	
	
	
	
365
	
U.S.	tax	credits
	
	
(
107
)
	
	
	
(
80
)
	
	
	
(
110
)
Noncontrolling	interests	and	redeemable
			noncontrolling	interests	adjustment
	
	
(
29
)
	
	
	
32
	
	
	
	
66
	
Effect	of	U.S.	tax	law	change
	
	
—
	
	
	
	
—
	
	
	
	
723
	
Bargain	in	purchase	gain
	
	
—
	
	
	
	
—
	
	
	
	
20
	
Convertible	debt
	
	
(
4
)
	
	
	
—


key: chroma:document
string_value:
(
4
)
	
	
	
—
	
	
	
	
—
	
Unrecognized	tax	benefits
	
	
17
	
	
	
	
1
	
	
	
	
3
	
Change	in	valuation	allowance
	
	
91
	
	
	
	
131
	
	
	
	
719
	
Provision	for	income	taxes
	
$
110
	
	
	
$
58
	
	
	
$
32
	
(1)
As	of
	January	1,	2017,	upon	the	adoption	of	ASU	No.	2016-09,	Improvements	to	Employee	Share-based	Payment	Accounting,	excess	tax	benefits
from	share-based	award	activity	incurred	from	the	prior	and	current	years	are	reflected	as	a	reduction	of	the	provision	for	income	taxes.	The
excess	tax	benefits	result	in	an	increase	to	our	gross	U.S.	deferred	tax	assets	that	is	offset	by	a	corresponding	increase	to	our	valuation
allowance.
As	of	December	31,	2019,	we	had	$
7.51
	billion	of	federal	and	$
6.16
	billion	of	state	net	operating	loss	carry-forwards	available	to	offset	future
taxable	income,	which	will	not	begin	to	significantly	expire	until	2024	for	federal	and	2028	for	state	purposes.	A	portion	of	these	losses	were	generated
by	SolarCity	prior	to	our	acquisition	in	2016	and,	therefore,	are	subject	to	change	of	control	provisions,	which	limit	the	amount	of	acquired	tax
attributes	that	can	be	utilized	in	a	given	tax	year.	We	do	not	expect	these	change	of	control	limitations	to	significantly	impact	our	ability	to	utilize	these
attributes.
As	of	December	31,	2019,	we	had	research	and	development	tax	credits	of	$
320
	million	and	$


key: chroma:document
string_value:
320
	million	and	$
284
	million	for	federal	and	state	income	tax
purposes,	respectively.	If	not	utilized,	the	federal	research	and	development	tax	credits	will	expire	in	various	amounts	beginning	in	
2024
.	However,	the
state	research	and	development	tax	credits	can	be	carried	forward	indefinitely.	In	addition,	we	have	other	general	business	tax	credits	of	$
125
	million
for	federal	income	tax	purposes,	which	will	not	begin	to	significantly	expire	until	
2033
.
No
	deferred	tax	liabilities	for	foreign	withholding	taxes	have	been	recorded	relating	to	the	earnings	of	our	foreign	subsidiaries	since	all	such
earnings	are	intended	to	be	indefinitely	reinvested.	The	amount	of	the	unrecognized	deferred	tax	liability	associated	with	these	earnings	is	immaterial.
Federal	and	state	laws	can	impose	substantial	restrictions	on	the	utilization	of	net	operating	loss	and	tax	credit	carry-forwards	in	the	event	of	an
“ownership	change,”	as	defined	in	Section	382	of	the	Internal	Revenue	Code.	We	have	determined	that	no	significant	limitation	would	be	placed	on	the
utilization	of	our	net	operating	loss	and	tax	credit	carry-forwards	due	to	prior	ownership	changes.
115


key: chroma:document
string_value:
Uncertain	Tax	Positions
The	changes	to	our	gross	unrecognized	tax	benefits	were	as	follows	(in	millions):
	
	
	
	
	
	
December	31,	2016
	
$
204
	
Decreases	in	balances	related	to	prior	year	tax	positions
	
	
(
31
)
Increases	in	balances	related	to	current	year	tax
			positions
	
	
84
	
Changes	in	balances	related	to	effect	of	U.S.	tax	law	change
	
	
(
58
)
December	31,	2017
	
	
199
	
Decreases	in	balances	related	to	prior	year	tax	positions
	
	
(
6
)
Increases	in	balances	related	to	current	year	tax
			positions
	
	
60
	
December	31,	2018
	
	
253
	
Decreases	in	balances	related	to	prior	year	tax	positions
	
	
(
39
)
Increases	in	balances	related	to	current	year	tax
			positions
	
	
59
	
December	31,	2019
	
$
273
	
As	of	December	31,	2019,	accrued	interest	and	penalties	related	to	unrecognized	tax	benefits	are	classified	as	income	tax	expense	and	were
immaterial.	Unrecognized	tax	benefits	of	$
247
	million,	if	recognized,	would	not	affect	our	effective	tax	rate	since	the	tax	benefits	would	increase	a
deferred	tax	asset	that	is	currently	fully	offset	by	a	full	valuation	allowance.
We	file	income	tax	returns	in	the	U.S.,	California	and	various	state	and	foreign	jurisdictions.	We	are	currently	under	examination	by	the	IRS	for
the	years	
2015
	and	
2016
.	Additional	tax	years	within	the	period	
2004
	to	
2018


key: chroma:document
string_value:
2004
	to	
2018
	remain	subject	to	examination	for	federal	income	tax	purposes,	and	tax
years	
2004
	to	
2018
	remain	subject	to	examination	for	California	income	tax	purposes.	All	net	operating	losses	and	tax	credits	generated	to	date	are
subject	to	adjustment	for	U.S.	federal	and	California	income	tax	purposes.	Tax	years	
2008
	to	
2018
	remain	subject	to	examination	in	other	U.S.	state	and
foreign	jurisdictions.
The	potential	outcome	of	the	current	examination	could	result	in	a	change	to	unrecognized	tax	benefits	within	the	next	twelve	months.
However,	we	cannot	reasonably	estimate	possible	adjustments	at	this	time.		
The	U.S.	Tax	Court	issued	a	decision	in	
Altera	Corp	v.	Commissioner
	related	to	the	treatment	of	stock-based	compensation	expense	in	a	cost-
sharing	arrangement.	On	June	7,	2019,	the	Court	reversed	the	Tax	Court	decision	and	upheld	the	validity	of	Treas.	Reg.	Section	1.482-7A(d)(2),
requiring	stock-based	compensation	costs	be	included	in	the	costs	shared	under	a	cost	sharing	agreement.	Given	that	the	current	active	decision	can
still	be	appealed	because	Altera	has	the	option	to	petition	up	to	the	Supreme	Court,	Tesla’s	position	is	to	continue	to	include	stock-based	compensation
in	cost	sharing	allocation	agreement.	If	and	when	the	current	tax	court’s	decision	is	overturned,	we	will	treat	the	amount	previously	shared	as	a	pre-
payment	to	future	cost	sharing	agreement	costs.	Because	we	have	a	full	valuation	allowance	in	the	U.S.,	any	potential	tax	benefits	would	increase	our
U.S.	deferred	tax	asset	and	would	not	have	a	material	impact	to	our	financials.


key: chroma:document
string_value:
Note	16	–	Commitments	and	Contingencies
Operating	Lease	Arrangement	in	Buffalo,	New	York
We	have	an	operating	lease	through	the	Research	Foundation	for	the	State	University	of	New	York	(the	“SUNY	Foundation”)	for	a
manufacturing	facility	constructed	on	behalf	of	the	SUNY	Foundation	and	which	was	substantially	completed	in	April	2018.		We	use	this	facility,
referred	to	as	Gigafactory	
New	York
,	primarily	for	the	development	and	production	of	our	Solar	Roof	and	other	solar	products	and	components,	energy
storage	components,	and	Supercharger	components,	and	for	other	lessor-approved	functions.		Under	the	lease	and	a	related	research	and	development
agreement,	on	behalf	of	the	SUNY	Foundation,	we	have	and	will	continue	to	install	certain	utilities	and	other	improvements	and	acquire	certain
equipment	designated	by	us	to	be	used	in	the	manufacturing	facility.	The	SUNY	Foundation	covered	(i)	construction	costs	related	to	the	manufacturing
facility	up	to	$
350
	million,	(ii)	the	acquisition	and	commissioning	of	the	manufacturing	equipment	in	an	amount	up	to	$
275
	million	and	(iii)	$
125
	million
for	additional	specified	scope	costs,	in	cases	(i)	and	(ii)	only,	subject	to	the	maximum	funding	allocation	from	the	State	of	New	York;	and	we	were
responsible	for	any	construction	or	equipment	costs	in	excess	of	such	amounts.	The	SUNY	Foundation	owns	the	manufacturing	facility	and	the
manufacturing	equipment	purchased	by	the	SUNY	Foundation.	Following	completion	of	the	manufacturing	facility,	we	have	commenced	leasing	of	the
manufacturing	facility	and	the	manufacturing	equipment	owned	by	the	SUNY	Foundation	for	an	initial	period	of	
10


key: chroma:document
string_value:
10
	years,	with	an	option	to	renew,	for
$
2.00
	per	year	plus	utilities.	
Following	the	adoption	of	ASC	842,	we	no	longer	recognize	the	build-to-suit	asset	and	related	depreciation	expense	or	the
corresponding	financing	liability	and	related	amortization	for	Gigafactory	New	York	in	our	consolidated	financial	statements.
Under	the	terms	of	the	operating	lease	arrangement,	we	are	required	to	achieve	specific	operational	milestones	during	the	initial	lease	term;
which	include	employing	a	certain	number	of	employees	at	the	manufacturing	facility,	within	western	New	York	and	within	the	State	of	New	York	within
specified	periods	following	the	completion	of	the	manufacturing	facility.	We	are	also	required	to	spend	or	incur	$
5.00
	billion	in	combined	capital,
operational	expenses	and	other	costs	in	the	State	of	New	York	within	10	years	following	the	achievement	of	full	production.	On	an	annual	basis	during
the	initial	lease	term,	as	measured	on	each	anniversary	of	the	commissioning	of	the	manufacturing	facility,	if	we	fail	to	meet	these	specified	investment
and	job	creation	requirements,	then	we	would	be	obligated	to	pay	a	$
41
	million	“program	payment”	to	the	SUNY	Foundation	for	each	year	that	we	fail
to	meet	these	requirements.	Furthermore,	if	the	arrangement	is	terminated	due	to	a	material	breach	by	us,	then	additional	amounts	might	become
payable	by	us.	As	of	December	31,	2019,	we	have	met	the	targets	as	of	the	applicable	measurement	dates	and	anticipate	meeting	the	remaining
obligations	through	our	operations	at	this	facility	and	other	operations	within	the	State	of	New	York.
Operating	Lease	Arrangement	in	Shanghai,	China


key: chroma:document
string_value:
Operating	Lease	Arrangement	in	Shanghai,	China
We	have	an	operating	lease	arrangement	for	an	initial	term	of	
50
	years	with	the	local	government	of	Shanghai	for	land	use	rights	where	we	are
constructing	Gigafactory	Shanghai.	Under	the	terms	of	the	arrangement,	we	are	required	to	spend	RMB	
14.08
	billion	in	capital	expenditures,	and	to
generate	RMB	
2.23
	billion	of	annual	tax	revenues	starting	at	the	end	of	2023.	If	we	are	unwilling	or	unable	to	meet	such	target	or	obtain	periodic
project	approvals,	in	accordance	with	the	Chinese	government’s	standard	terms	for	such	arrangements,	we	would	be	required	to	revert	the	site	to	the
local	government	and	receive	compensation	for	the	remaining	value	of	the	land	lease,	buildings	and	fixtures.	We	believe	the	capital	expenditure
requirement	and	the	tax	revenue	target	will	be	attainable	even	if	our	actual	vehicle	production	was	far	lower	than	the	volumes	we	are	forecasting.
117


key: chroma:document
string_value:
Legal	Proceedings
Securities	Litigation	Relating	to	the	SolarCity	Acquisition
Between	September	1,	2016	and	October	5,	2016,	
seven
lawsuits	were	filed	in	the	Delaware	Court	of	Chancery	by	purported	stockholders	of	Tesla
challenging	our	acquisition	of	SolarCity.	Following	consolidation,	the	lawsuit	names	as	defendants	the	members	of	Tesla’s	board	of	directors	as	then
constituted	and	alleges,	among	other	things,	that	board	members	breached	their	fiduciary	duties	in	connection	with	the	acquisition.	The	complaint	asserts
both	derivative	claims	and	direct	claims	on	behalf	of	a	purported	class	and	seeks,	among	other	relief,	unspecified	monetary	damages,	attorneys’	fees,	and
costs.	On	
January
	
27,	2017,	defendants	filed	a	motion	to	dismiss	the	operative	complaint.	Rather	than	respond	to	the	defendants’	motion,	the	plaintiffs	filed
an	amended	complaint.	On	March
	
17,	2017,	defendants	filed	a	motion	to	dismiss	the	amended	complaint.	On	December
	
13,	2017,	the	Court	heard	oral
argument	on	the	motion.	On	March
	
28,	2018,	the	Court	denied	defendants’	motion	to	dismiss.	Defendants	filed	a	request	for	interlocutory	appeal,	but	the
Delaware	Supreme	Court	denied	that	request	without	ruling	on	the	merits	but	electing	not	to	hear	an	appeal	at	this	early	stage	of	the	case.	Defendants
filed	their	answer	on	May	18,	2018,	and
	mediations	were	held	on	June	10,	2019.	Plaintiffs	and	defendants	filed	respective	motions	for	summary	judgment


key: chroma:document
string_value:
on	August	25,	2019,	and	further	mediations	were	held	on	October	3,	2019.	The	Court	held	a	hearing	on	the	motions	for	summary	judgment	on
November	4,	2019.	On	January	22,	2020,	all	of	the	director	defendants	except	Elon	Musk	reached	a	tentative	settlement	to	resolve	the	lawsuit	against
them	for	an	amount	that	would	be	paid	entirely	under	the	applicable	insurance	policy.	
The	settlement	does	not	involve	an	admission	of	any	wrongdoing
by	any	party.	
Tesla	will	receive	such	amount,	which	would	be	recognized	as	a	gain	in	its	financial	statements,	
if	the	settlement	is	finally	approved	by	the
Court.	
On	February	4,	2020,	the	Court	issued	a	ruling	that	denied	plaintiffs’	previously-filed	motion	and	granted	in	part	and	denied	in	part	defendants’
previously-filed	motion.		Fact	and	expert	discovery	is	complete,	and	the	case	is	set	for	trial	in	March	2020.
These	plaintiffs	and	others	filed	parallel	actions	in	the	U.S.	District	Court	for	the	District	of	Delaware	on	or	about	April
	
21,	2017.	They	include
claims	for	violations	of	the	federal	securities	laws	and	breach	of	fiduciary	duties	by	Tesla’s	board	of	directors.	Those	actions	have	been	consolidated	and
stayed	pending	the	above-referenced	Chancery	Court	litigation.
We	believe	that	claims	challenging	the	SolarCity	acquisition	are	without	merit	and	intend	to	defend	against	them	vigorously.	We	are	unable	to
estimate	the	possible	loss	or	range	of	loss,	if	any,	associated	with	these	claims.
Securities	Litigation	Relating	to	Production	of	Model	3	Vehicles
On
	October


key: chroma:document
string_value:
On
	October
	
10,	2017,	a	purported	stockholder	class	action	was	filed	in	the	U.S.	District	Court	for	the	Northern	District	of	California	against
Tesla,	two	of	its	current	officers,	and	a	former	officer.	The	complaint	alleges	violations	of	federal	securities	laws	and	seeks	unspecified	compensatory
damages	and	other	relief	on	behalf	of	a	purported	class	of	purchasers	of	Tesla	securities	from	May
	
4,	2016	to	October
	
6,	2017.	The	lawsuit	claims	that
Tesla	supposedly	made	materially	false	and	misleading	statements	regarding	the	Company’s	preparedness	to	produce	Model	3	vehicles.	Plaintiffs	filed
an	amended	complaint	on	March
	
23,	2018,	and	defendants	filed	a	motion	to	dismiss	on	May
	
25,	2018.	The	court	granted	defendants’	motion	to	dismiss
with	leave	to	amend.		Plaintiffs	filed	their	amended	complaint	on	September	28,	2018,	and	defendants	filed	a	motion	to	dismiss	the	amended	complaint
on	February	15,	2019.		The	hearing	on	the	motion	to	dismiss	was	held	on	March	22,	2019,	and	on	March	25,	2019,	the	Court	ruled	in	favor	of
defendants	and	dismissed	the	complaint	with	prejudice.		On	April	8,	2019,	plaintiffs	filed	a	notice	of	appeal	and	on	July	17,	2019	filed	their	opening
brief.	We	filed	our	opposition	on	September	16,	2019.	We	continue	to	believe	that	the	claims	are	without	merit	and	intend	to	defend	against	this	lawsuit
vigorously.	We	are	unable	to	estimate	the	possible	loss	or	range	of	loss,	if	any,	associated	with	this	lawsuit.
118


key: chroma:document
string_value:
On	October	26,	2018,	in	a	similar	action,	a	purported	stockholder	class	action	was	filed	in	the	Superior	Court	of	California	in	Santa	Clara
County	against	Tesla,	Elon	Musk	and	seven	initial	purchasers	in	an	offering	of	debt	securities	by	Tesla	in	August	2017.	The	complaint	alleges
misrepresentations	made	by	Tesla	regarding	the	number	of	Model	3	vehicles	Tesla	expected	to	produce	by	the	end	of	2017	in	connection	with	such
offering	and	seeks	unspecified	compensatory	damages	and	other	relief	on	behalf	of	a	purported	class	of	purchasers	of	Tesla	securities	in	such	offering.
Tesla	thereafter	removed	the	case	to	federal	court.		On	January	22,	2019,	plaintiff	abandoned	its	effort	to	proceed	in	state	court,	instead	filing	an
amended	complaint	against	Tesla,	Elon	Musk	and	seven	initial	purchasers	in	the	debt	offering	before	the	same	judge	in	the	U.S.	District	Court	for	the
Northern	District	of	California	who	is	hearing	the	above-referenced	earlier	filed	federal	case.		On	February	5,	2019,	the	Court	stayed	this	new	case
pending	a	ruling	on	the	motion	to	dismiss	the	complaint	in	such	earlier	filed	federal	case.		After	such	earlier	filed	federal	case	was	dismissed,
defendants	filed	a	motion	on	July	2,	2019	to	dismiss	this	case	as	well.	This	case	is	now	stayed	pending	a	ruling	from	the	appellate	court	on	such	earlier
filed	federal	case	with	an	agreement	that	if	defendants	prevail	on	appeal	in	such	case,	this	case	will	be	dismissed.	We	believe	that	the	claims	are


key: chroma:document
string_value:
without	merit	and	intend	to	defend	against	this	lawsuit	vigorously.	We	are	unable	to	estimate	the	possible	loss	or	range	of	loss,	if	any,	associated	with
this	lawsuit.
Litigation	Relating	to	2018	CEO	Performance	Award
On	June	4,	2018,	a	purported	Tesla	stockholder	filed	a	putative	class	and	derivative	action	in	the	Delaware	Court	of	Chancery	against	Elon	Musk
and	the	members	of	Tesla’s	board	of	directors	as	then	constituted,	alleging	corporate	waste,	unjust	enrichment	and	that	such	board	members	breached
their	fiduciary	duties	by	approving	the	stock-based	compensation	plan.	The	complaint	seeks,	among	other	things,	monetary	damages	and	rescission	or
reformation	of	the	stock-based	compensation	plan.	On	August	31,	2018,	defendants	filed	a	motion	to	dismiss	the	complaint;	plaintiff	filed	its	opposition
brief	on	November	1,	2018	and	defendants	filed	a	reply	brief	on	December	13,	2018.		The	hearing	on	the	motion	to	dismiss	was	held	on	May	9,	2019.	On
September	20,	2019,	the	Court	granted	the	motion	to	dismiss	as	to	the	corporate	waste	claim	but	denied	the	motion	as	to	the	breach	of	fiduciary	duty
and	unjust	enrichment	claims.	Our	answer	was	filed	on	December	3,	2019,	and	trial	is	set	for	June	2021.	We	believe	the	claims	asserted	in	this	lawsuit
are	without	merit	and	intend	to	defend	against	them	vigorously.
Securities	Litigation	Relating	to	Potential	Going	Private	Transaction
Between	August	10,	2018	and	September	6,	2018,	nine	purported	stockholder	class	actions	were	filed	against	Tesla	and	Elon	Musk	in


key: chroma:document
string_value:
connection	with	Elon	Musk’s	August	7,	2018	Twitter	post	that	he	was	considering	taking	Tesla	private.	All	of	the	suits	are	now	pending	in	the	U.S.
District	Court	for	the	Northern	District	of	California.	Although	the	complaints	vary	in	certain	respects,	they	each	purport	to	assert	claims	for	violations
of	federal	securities	laws	related	to	Mr.	Musk’s	statement	and	seek	unspecified	compensatory	damages	and	other	relief	on	behalf	of	a	purported	class	of
purchasers	of	Tesla’s	securities.	Plaintiffs	filed	their	consolidated	complaint	on	January	16,	2019	and	added	as	defendants	the	members	of	Tesla’s	board
of	directors.		The	now-consolidated	purported	stockholder	class	action	was	stayed	while	the	issue	of	selection	of	lead	counsel	was	briefed	and	argued
before	the	U.S.	Court	of	Appeals	for	the	Ninth	Circuit.	The	Ninth	Circuit	ruled	regarding	lead	counsel.	Defendants	filed	a	motion	to	dismiss	the
complaint	on	November	22,	2019.		The	hearing	on	the	motion	is	set	for	March	6,	2020.		We	believe	that	the	claims	have	no	merit	and	intend	to	defend
against	them	vigorously.	We	are	unable	to	estimate	the	potential	loss,	or	range	of	loss,	associated	with	these	claims.
Between	October	17,	2018	and	November	9,	2018,	five	derivative	lawsuits	were	filed	in	the	Delaware	Court	of	Chancery	against	Mr.	Musk	and
the	members	of	Tesla’s	board	of	directors	as	then	constituted	in	relation	to	statements	made	and	actions	connected	to	a	potential	going	private


key: chroma:document
string_value:
transaction.		In	addition	to	these	cases,	on	October	25,	2018,	another	derivative	lawsuit	was	filed	in	the	U.S.	District	Court	for	the	District	of	Delaware
against	Mr.	Musk	and	the	members	of	the	Tesla	board	of	directors	as	then	constituted.	The	Courts	in	both	the	Delaware	federal	court	and	Delaware
Court	of	Chancery	actions	have	consolidated	their	respective	actions	and	stayed	each	consolidated	action	pending	resolution	of	the	above-referenced
consolidated	purported	stockholder	class	action.	We	believe	that	the	claims	have	no	merit	and	intend	to	defend	against	them	vigorously.	We	are	unable
to	estimate	the	potential	loss,	or	range	of	loss,	associated	with	these	claims.
119


key: chroma:document
string_value:
On	March	7,	2019,	various	stockholders	filed	a	derivative	suit	in	the	Delaware	Court	of	Chancery,	purportedly	on	behalf	of	the	Company,
naming	Elon	Musk	and	Tesla’s	board	of	directors,	also	related	to	Mr.	Musk’s	August	7,	2018	Twitter	post	that	is	the	basis	of	the	above-referenced
consolidated	purported	stockholder	class	action	as	well	as	Mr.	Musk’s	February	19,	2019	Twitter	post	regarding	Tesla’s	vehicle	production.	The	suit
asserts	claims	for	breach	of	fiduciary	duty	and	seeks	declaratory	and	injunctive	relief,	unspecified	damages,	and	other	relief.	Plaintiffs	moved	for
expedited	proceedings	in	connection	with	the	declaratory	and	injunctive	relief.		Briefs	were	filed	on	March	13,	2019	and	the	hearing	held	on	March	18,
2019.		Defendants	prevailed,	with	the	Court	denying	plaintiffs’	request	for	an	expedited	trial	and	granting	defendants’	request	to	stay	this	action
pending	the	outcome	of	the	above-referenced	consolidated	purported	stockholder	class	action.	
Settlement	with	SEC	related	to	Potential	Going	Private	Transaction
On	October	16,	2018,	the	U.S.	District	Court	for	the	Southern	District	of	New	York	entered	a	final	judgment	approving	the	terms	of	a	settlement
filed	with	the	Court	on	September	29,	2018,	in	connection	with	the	actions	taken	by	the	U.S.	Securities	and	Exchange	Commission	(the	“SEC”)	relating
to	Elon	Musk’s	prior	statement	that	he	was	considering	taking	Tesla	private.	Without	admitting	or	denying	any	of	the	SEC’s	allegations,	and	with	no


key: chroma:document
string_value:
restriction	on	Mr.	Musk’s	ability	to	serve	as	an	officer	or	director	on	the	Board	(other	than	as	its	Chair),	among	other	things,	we	and	Mr.	Musk	paid	civil
penalties	of	$
20
	million	each	and	agreed	that	an	independent	director	will	serve	as	Chair	of	the	Board	for	at	least	
three	years
,	and	we	appointed	such	
an
independent	Chair	of	the	Board	and	
two
	additional	independent	directors	to	the	Board,	and	further	enhanced	our	disclosure	controls	and	other
corporate	governance-related	matters.	On	April	26,	2019,	the	settlement	was	amended	to	modify	certain	of	the	previously-agreed	disclosure	procedures
to	clarify	the	application	of	such	procedures,	which	was	subsequently	approved	by	the	Court.	All	other	terms	of	the	prior	settlement	were	reaffirmed
without	modification.
Certain	Investigations	and	Other	Matters
We	receive	requests	for	information	from	regulators	and	governmental	authorities,	such	as	the	National	Highway	Traffic	Safety	Administration,
the	National	Transportation	Safety	Board,	the	SEC,	the	Department	of	Justice	(“DOJ”)	and	various	state,	federal	and	international	agencies.	We
routinely	cooperate	with	such	regulatory	and	governmental	requests.
	
In	particular,	the	SEC	had	issued	subpoenas	to	Tesla	in	connection	with	(a)	Elon	Musk’s	prior	statement	that	he	was	considering	taking	Tesla
private	and	(b)	certain	projections	that	we	made	for	Model	3	production	rates	during	2017	and	other	public	statements	relating	to	Model	3	production.
The	take-private	investigation	was	resolved	and	closed	with	the	settlement	with	the	SEC	described	above.		On	December	4,	2019,	the	SEC	(i)	closed	the


key: chroma:document
string_value:
investigation	into	the	projections	and	other	public	statements	regarding	Model	3	production	rates	and	(ii)	issued	a	subpoena	seeking	information
concerning	certain	financial	data	and	contracts	including	Tesla’s	regular	financing	arrangements
.		Separately,	the	DOJ	had	also	asked	us	to	voluntarily
provide	it	with	information	about	the	above	matters	related	to	taking	Tesla	private	and	Model	3	production	rates.
Aside	from	the	settlement,	as	amended,	with	the	SEC	relating	to	Mr.	Musk’s	statement	that	he	was	considering	taking	Tesla	private,	there	have
not	been	any	developments	in	these	matters	that	we	deem	to	be	material,	and	to	our	knowledge	no	government	agency	in	any	ongoing	investigation	has
concluded	that	any	wrongdoing	occurred.	As	is	our	normal	practice,	we	have	been	cooperating	and	will	continue	to	cooperate	with	government
authorities.	We	cannot	predict	the	outcome	or	impact	of	any	ongoing	matters.	Should	the	government	decide	to	pursue	an	enforcement	action,	there
exists	the	possibility	of	a	material	adverse	impact	on	our	business,	results	of	operation,	prospects,	cash	flows,	and	financial	position.
We	are	also	subject	to	various	other	legal	proceedings	and	claims	that	arise	from	the	normal	course	of	business	activities.	If	an	unfavorable
ruling	or	development	were	to	occur,	there	exists	the	possibility	of	a	material	adverse	impact	on	our	business,	results	of	operations,	prospects,	cash
flows,	financial	position	and	brand.
120


key: chroma:document
string_value:
Indemnification	and	Guaranteed	Returns
We	are	contractually	obligated	to	compensate	certain	fund	investors	for	any	losses	that	they	may	suffer	in	certain	limited	circumstances
resulting	from	reductions	in	U.S.	Treasury	grants	or	investment	tax	credits	(“ITC”s).	Generally,	such	obligations	would	arise	as	a	result	of	reductions	to
the	value	of	the	underlying	solar	energy	systems	as	assessed	by	the	U.S.	Treasury	Department	for	purposes	of	claiming	U.S.	Treasury	grants	or	as
assessed	by	the	IRS	for	purposes	of	claiming	ITCs	or	U.S.	Treasury	grants.	For	each	balance	sheet	date,	we	assess	and	recognize,	when	applicable,	a
distribution	payable	for	the	potential	exposure	from	this	obligation	based	on	all	the	information	available	at	that	time,	including	any	guidelines	issued	by
the	U.S.	Treasury	Department	on	solar	energy	system	valuations	for	purposes	of	claiming	U.S.	Treasury	grants	and	any	audits	undertaken	by	the	IRS.
We	believe	that	any	payments	to	the	fund	investors	in	excess	of	the	amounts	already	recognized	by	us	for	this	obligation	are	not	probable	or	material
based	on	the	facts	known	at	the	filing	date.
The	maximum	potential	future	payments	that	we	could	have	to	make	under	this	obligation	would	depend	on	the	difference	between	the	fair
values	of	the	solar	energy	systems	sold	or	transferred	to	the	funds	as	determined	by	us	and	the	values	that	the	U.S.	Treasury	Department	would
determine	as	fair	value	for	the	systems	for	purposes	of	claiming	U.S.	Treasury	grants	or	the	values	the	IRS	would	determine	as	the	fair	value	for	the


key: chroma:document
string_value:
systems	for	purposes	of	claiming	ITCs	or	U.S.	Treasury	grants.	We	claim	U.S.	Treasury	grants	based	on	guidelines	provided	by	the	U.S.	Treasury
department	and	the	statutory	regulations	from	the	IRS.	We	use	fair	values	determined	with	the	assistance	of	independent	third-party	appraisals
commissioned	by	us	as	the	basis	for	determining	the	ITCs	that	are	passed-through	to	and	claimed	by	the	fund	investors.	Since	we	cannot	determine
future	revisions	to	U.S.	Treasury	Department	guidelines	governing	solar	energy	system	values	or	how	the	IRS	will	evaluate	system	values	used	in
claiming	ITCs	or	U.S.	Treasury	grants,	we	are	unable	to	reliably	estimate	the	maximum	potential	future	payments	that	it	could	have	to	make	under	this
obligation	as	of	each	balance	sheet	date.
We	are	eligible	to	receive	certain	state	and	local	incentives	that	are	associated	with	renewable	energy	generation.	The	amount	of	incentives	that
can	be	claimed	is	based	on	the	projected	or	actual	solar	energy	system	size	and/or	the	amount	of	solar	energy	produced.	We	also	currently	participate
in	one	state’s	incentive	program	that	is	based	on	either	the	fair	market	value	or	the	tax	basis	of	solar	energy	systems	placed	in	service.	State	and	local
incentives	received	are	allocated	between	us	and	fund	investors	in	accordance	with	the	contractual	provisions	of	each	fund.	We	are	not	contractually
obligated	to	indemnify	any	fund	investor	for	any	losses	they	may	incur	due	to	a	shortfall	in	the	amount	of	state	or	local	incentives	actually	received.
Our	lease	pass-through	financing	funds	have	a	one-time	lease	payment	reset	mechanism	that	occurs	after	the	installation	of	all	solar	energy


key: chroma:document
string_value:
systems	in	a	fund.	As	a	result	of	this	mechanism,	we	may	be	required	to	refund	master	lease	prepayments	previously	received	from	investors.	Any
refunds	of	master	lease	prepayments	would	reduce	the	lease	pass-through	financing	obligation.
Letters	of	Credit
As	of	December	31,	2019,	we	had	$
282
	
million	of	unused	letters	of	credit	outstanding
.
	
Note	17	–	Variable	Interest	Entity	Arrangements
We	have	entered	into	various	arrangements	with	investors	to	facilitate	the	funding	and	monetization	of	our	
solar	energy	systems	and	vehicles.
In	particular,	our	wholly	owned	subsidiaries	and	fund	investors	have	formed	and	contributed	cash	and	assets	into	various	financing	funds	and	entered
into	related	agreements.
	We	have	determined	that	the	funds	are	variable	interest	entities	(“VIEs”)	and	we	are	the	primary	beneficiary	of	these	VIEs	by
reference	to	the	power	and	benefits	criterion	under	ASC	810,	
Consolidation
.	We	have	considered	the	provisions	within	the	agreements,	which	grant	us
the	power	to	manage	and	make	decisions	that	affect	the	operation	of	these	VIEs,	including	determining	the	solar	energy	systems	or	vehicles	and	the
associated	customer	contracts	to	be	sold	or	contributed	to	these	VIEs,	redeploying	solar	energy	systems	or	vehicles	and	managing	customer
receivables.	We	consider	that	the	rights	granted	to	the	fund	investors	under	the	agreements	are	more	protective	in	nature	rather	than	participating.
121


key: chroma:document
string_value:
As	the	primary	beneficiary	of	these	VIEs,	we	consolidate	in	the	financial	statements	the	financial	position,	results	of	operations	and	cash	flows
of	these	VIEs,	and	all	intercompany	balances	and	transactions	between	us	and	these	VIEs	are	eliminated	in	the	consolidated	financial	statements.	Cash
distributions	of	income	and	other	receipts	by	a	fund,	net	of	agreed	upon	expenses,	estimated	expenses,	tax	benefits	and	detriments	of	income	and	loss
and	tax	credits,	are	allocated	to	the	fund	investor	and	our	subsidiary	as	specified	in	the	agreements.
Generally,	our	subsidiary	has	the	option	to	acquire	the	fund	investor’s	interest	in	the	fund	for	an	amount	based	on	the	market	value	of	the	fund
or	the	formula	specified	in	the	agreements.
Upon	the	sale	or	liquidation	of	a	fund,	distributions	would	occur	in	the	order	and	priority	specified	in	the	agreements.
Pursuant	to	management	services,	maintenance	and	warranty	arrangements,	we	have	been	contracted	to	provide	services	to	the	funds,	such	as
operations	and	maintenance	support,	accounting,	lease	servicing	and	performance	reporting.	In	some	instances,	we	have	guaranteed	payments	to	the
fund	investors	as	specified	in	the	agreements.	A	fund’s	creditors	have	no	recourse	to	our	general	credit	or	to	that	of	other	funds.	None	of	the	assets	of
the	funds	had	been	pledged	as	collateral	for	their	obligations.
The	aggregate	carrying	values	of	the	VIEs’	assets	and	liabilities,	after	elimination	of	any	intercompany	transactions	and	balances,	in	the
consolidated	balance	sheets	were	as	follows	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018


key: chroma:document
string_value:
2019
	
	
2018
	
Assets
	
	
	
	
	
	
	
	
Current	assets
	
	
	
	
	
	
	
	
Cash	and	cash	equivalents
	
$
106
	
	
$
75
	
Restricted	cash
	
	
90
	
	
	
131
	
Accounts	receivable,	net
	
	
27
	
	
	
19
	
Prepaid	expenses	and	other	current	assets
	
	
10
	
	
	
10
	
Total	current	assets
	
	
233
	
	
	
235
	
Operating	lease	vehicles,	net
	
	
1,183
	
	
	
155
	
Solar	energy	systems,	net
	
	
5,030
	
	
	
5,117
	
Restricted	cash,	net	of	current	portion
	
	
69
	
	
	
65
	
Other	assets
	
	
87
	
	
	
56
	
Total	assets
	
$
6,602
	
	
$
5,628
	
Liabilities
	
	
	
	
	
	
	
	
Current	liabilities
	
	
	
	
	
	
	
	
Accrued	liabilities	and	other
	
	
80
	
	
	
133
	
Deferred	revenue
	
	
78
	
	
	
21
	
Customer	deposits
	
	
9
	
	
	
—
	
Current	portion	of	long-term	debt	and	finance	leases
	
	
608
	
	
	
663
	
Total	current	liabilities
	
	
775
	
	
	
817
	
Deferred	revenue,	net	of	current	portion
	
	
264
	
	
	
178
	
Long-term	debt	and	finance	leases,	net	of	current	portion
	
	
1,516


key: chroma:document
string_value:
1,516
	
	
	
1,238
	
Other	long-term	liabilities
	
	
22
	
	
	
26
	
Total	liabilities
	
$
2,577
	
	
$
2,259
	
Note	18	–	Lease	Pass-Through	Financing	Obligation
Through	December	31,	2019,	we	had	entered	into	
eight
	transactions	referred	to	as	“lease	pass-through	fund	arrangements”.	Under	these
arrangements,	our	wholly	owned	subsidiaries	finance	the	cost	of	solar	energy	systems	with	investors	through	arrangements	contractually	structured	as
master	leases	for	an	initial	term	ranging	between	
10	and	25	years
.	These	solar	energy	systems	are	subject	to	lease	or	PPAs	with	customers	with	an
initial	term	not	exceeding	
25
	years.	These	solar	energy	systems	are	included	within	solar	energy	systems,	net	on	the	consolidated	balance	sheets.
122


key: chroma:document
string_value:
The	cost	of	the	solar	energy	systems	under	lease	pass-through	fund	arrangements	as	of	December	31,	2019	and	2018	was	
$
1.05
	billion.	The
accumulated	depreciation	on	these	assets	as	of	December	31,	2019	and	2018	was	$
101
	million	and	$
66
	million,	respectively.	The	total	lease	pass-
through	financing	obligation	as	of	December	31,	2019	was	$
94
	million,	of	which	$
57
	million	is	classified	as	a	current	liability.	The	total	lease	pass-
through	financing	obligation	as	of	December	31,	2018	was	$
112
	million,	of	which	$
62
	million	was	classified	as	a	current	liability.	Lease	pass-through
financing	obligation	is	included	in	accrued	liabilities	and	other	for	the	current	portion	and	other	long-term	liabilities	for	the	long-term	portion	on	the
consolidated	balance	sheets.
Under	a	lease	pass-through	fund	arrangement,	the	investor	makes	a	large	upfront	payment	to	the	lessor,	which	is	one	of	our	subsidiaries,	and	in
some	cases,	subsequent	periodic	payments.	We	allocate	a	portion	of	the	aggregate	investor	payments	to	the	fair	value	of	the	assigned	ITCs,	which	is
estimated	by	discounting	the	projected	cash	flow	impact	of	the	ITCs	using	a	market	interest	rate	and	is	accounted	for	separately	(see	Note	2,	
Summary
of	Significant	Accounting	Policies
).	We	account	for	the	remainder	of	the	investor	payments	as	a	borrowing	by	recording	the	proceeds	received	as	a	lease
pass-through	financing	obligation,	which	is	repaid	from	the	future	customer	lease	payments	and	any	incentive	rebates.	A	portion	of	the	amounts


key: chroma:document
string_value:
received	by	the	investor	is	allocated	to	interest	expense	using	the	effective	interest	rate	method.
The	lease	pass-through	financing	obligation	is	non-recourse	once	the	associated	solar	energy	systems	have	been	placed	in-service	and	the
associated	customer	arrangements	have	been	assigned	to	the	investors.	However,	we	are	required	to	comply	with	certain	financial	covenants	specified
in	the	contractual	agreements,	which	we	had	met	as	of	December	31,	2019.	In	addition,	we	are	responsible	for	any	warranties,	performance	guarantees,
accounting	and	performance	reporting.	Furthermore,	we	continue	to	account	for	the	customer	arrangements	and	any	incentive	rebates	in	the
consolidated	financial	statements,	regardless	of	whether	the	cash	is	received	by	us	or	directly	by	the	investors.
As	of	December	31,	2019,	the	future	minimum	master	lease	payments	to	be	received	from	investors,	for	each	of	the	next	five	years	and
thereafter,	were	as	follows	(in	millions):
	
2020
	
$
42
	
2021
	
	
41
	
2022
	
	
33
	
2023
	
	
26
	
2024
	
	
18
	
Thereafter
	
	
450
	
Total
	
$
610
For	two	of	the	lease	pass-through	fund	arrangements,	our	subsidiaries	have	pledged	its	assets	to	the	investors	as	security	for	its	obligations
under	the	contractual	agreements.
Each	lease	pass-through	fund	arrangement	has	a	one-time	master	lease	prepayment	adjustment	mechanism	that	occurs	when	the	capacity	and
the	placed-in-service	dates	of	the	associated	solar	energy	systems	are	finalized	or	on	an	agreed-upon	date.	As	part	of	this	mechanism,	the	master	lease


key: chroma:document
string_value:
prepayment	amount	is	updated,	and	we	may	be	obligated	to	refund	a	portion	of	a	master	lease	prepayment	or	entitled	to	receive	an	additional	master
lease	prepayment.	Any	additional	master	lease	prepayments	are	recorded	as	an	additional	lease	pass-through	financing	obligation	while	any	master
lease	prepayment	refunds	would	reduce	the	lease	pass-through	financing	obligation.
	
	
Note	19	–	Defined	Contribution	Plan
We	have	a	401(k)	savings	plan	that	is	intended	to	qualify	as	a	deferred	salary	arrangement	under	Section	401(k)	of	the	Internal	Revenue	Code.
Under	the	401(k)	savings	plan,	participating	employees	may	elect	to	contribute	up	to	
100
%	of	their	eligible	compensation,	subject	to	certain	limitations.
Participants	are	fully	vested	in	their	contributions.	We	did	
no
t	make	any	contributions	to	the	401(k)	savings	plan	during	the	years	ended	December	31,
2019,	2018	and	2017	(other	than	employee	deferrals	of	eligible	compensation).
	
	
123


key: chroma:document
string_value:
Note	20	–	Related	Party	Transactions
Related	party	balances	were	comprised	of	the	following	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
Convertible	senior	notes	due	to	related	parties
	
$
3
	
	
$
3
	
Our	convertible	senior	notes	are	not	re-measured	at	fair	value	(refer	to	Note	5,	
Fair	Value	of	Financial	Instruments
).	As	of	December	31,	2019
and	2018,	the	unpaid	principal	balance	of	convertible	senior	notes	due	to	related	parties	is	$
3
	million.
In	March	2017,	our	CEO	purchased	from	us	
95,420
	shares	of	our	common	stock	in	a	public	offering	at	the	public	offering	price	for	an	aggregate
$
25
	million.
In	April	2017,	our	CEO	exercised	his	right	under	the	indenture	to	convert	all	of	his	Zero-Coupon	Convertible	Senior	Notes	due	in	2020,	which
had	an	aggregate	principal	amount	of	$
10
	million.	As	a	result,	
on	April	26,	2017,	we	issued	
33,333
	shares	
of	our	common	stock	to	our	CEO	in
accordance	with	the	specified	conversion	rate,	and
	we	recorded	an	increase	to	additional	paid-in	capital	of	$
10
	million.
In	November	2018,	our	CEO	purchased	from	us	
56,915
	shares	of	our	common	stock	in	a	private	placement	at	a	per	share	price	equal	to	the	last
closing	price	of	our	stock	prior	to	the	execution	of	the	purchase	agreement	for	an	aggregate	$
20
	million.
In	May	2019,	our	CEO	purchased	from	us	
102,880


key: chroma:document
string_value:
102,880
	shares	of	our	common	stock	in	a	public	offering	at	the	public	offering	price	for	an	aggregate
$
25
	million.
	
Note	21	–	Segment	Reporting	and	Information	about	Geographic	Areas
We	have	
two
	operating	and	reportable	segments:	(i)	automotive	and	(ii)	energy	generation	and	storage.	The	automotive	segment	includes	the
design,	development,	manufacturing,	sales,	and	leasing	of	electric	vehicles	as	well	as	sales	of	automotive	regulatory	credits.	Additionally,	the
automotive	segment	is	also	comprised	of	services	and	other,	which	includes	non-warranty	after-sales	vehicle	services,	sales	of	used	vehicles,	retail
merchandise,	sales	by	our	acquired	subsidiaries	to	third	party	customers,	and	vehicle	insurance	revenue.	The	energy	generation	and	storage	segment
includes	the	design,	manufacture,	installation,	sales,	and	leasing	of	solar	energy	generation	and	energy	storage	products	and	related	services	and	sales
of	solar	energy	systems	incentives.	Our	CODM	does	not	evaluate	operating	segments	using	asset	or	liability	information.	
The	following	table	presents
revenues	and	gross	profit	by	reportable	segment	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
Automotive	segment
	
	
	
	
	
	
	
	
	
	
	
	
Revenues
	
$
23,047
	
	
$
19,906
	
	
$
10,643
	
Gross	profit
	
$
3,879
	
	
$
3,852
	
	
$
1,981
	
Energy	generation	and	storage	segment
	
	
	
	
	
	
	
	
	
	
	
	
Revenues


key: chroma:document
string_value:
The	following	table	presents	revenues	by	geographic	area	based	on	the	sales	location	of	our	products	(in	millions):
	
	
	
Year	Ended	December	31,
	
	
	
2019
	
	
2018
	
	
2017
	
United	States
	
$
12,653
	
	
$
14,872
	
	
$
6,221
	
China
	
	
2,979
	
	
	
1,757
	
	
	
2,027
	
Netherlands
	
	
1,590
	
	
	
965
	
	
	
331
	
Norway
	
	
1,201
	
	
	
813
	
	
	
823
	
Other
	
	
6,155
	
	
	
3,054
	
	
	
2,357
	
Total
	
$
24,578
	
	
$
21,461
	
	
$
11,759
	
The	revenues	in	certain	geographic	areas	were	impacted	by	the	price	adjustments	we	made	to	our	vehicle	offerings	during	2019	.	Refer	to	Note
2,	
Summary	of	Significant	Accounting	Policies
,	for	details.
	
The	following	table	presents	long-lived	assets	by	geographic	area	(in	millions):
	
	
	
December	31,
	
	
December	31,
	
	
	
2019
	
	
2018
	
United	States
	
$
15,644
	
	
$
16,741
	
International
	
	
890
	
	
	
860
	
Total
	
$
16,534
	
	
$
17,601
	
Note	22	–	Restructuring	and	Other


key: chroma:document
string_value:
Note	22	–	Restructuring	and	Other
During	the	year	ended	December	31,	2019,	we	carried	out	certain	restructuring	actions	in	order	to	reduce	costs	and	improve	efficiency.	As	a
result,	we	recognized	$
50
	million	of	costs	primarily	related	to	employee	termination	expenses	and	losses	from	closing	certain	stores	impacting	both
segments.	We	recognized	$
47
	million	in	impairment	related	to	the	IPR&D	intangible	asset	as	we	abandoned	further	development	efforts	(refer	to	Note
4,	
Goodwill	and	Intangible	Assets
	for	details)	and	$
15
	million	for	the	related	equipment	within	the	energy	generation	and	storage	segment.	We	also
incurred	a	loss	of	$
37
	million	for	closing	operations	in	certain	facilities.	On	the	statement	of	cash	flows,	the	amounts	were	presented	in	the	captions	in
which	such	amounts	would	have	been	recorded	absent	the	impairment	charges.	The	employee	termination	expenses	were	substantially	paid	by
December	31,	2019,	while	the	remaining	amounts	were	non-cash.
During	the	year	ended	December	31,	2018,	we	carried-out	certain	restructuring	actions	in	order	to	reduce	costs	and	improve	efficiency	and
recognized	$
37
	million	of	employee	termination	expenses	and	estimated	losses	from	sub-leasing	a	certain	facility.	The	employee	termination	cash	expenses
of	$
27
	million	were	substantially	paid	by	the	end	of	2018,	while	the	remaining	amounts	were	non-cash.	Also	included	within	restructuring	and	other
activities	was	$
55
	million	of	expenses	(materially	all	of	which	were	non-cash)	from	restructuring	the	energy	generation	and	storage	segment,	which


key: chroma:document
string_value:
comprised	of	disposals	of	certain	tangible	assets,	the	shortening	of	the	useful	life	of	a	trade	name	intangible	asset	and	a	contract	termination	penalty.	In
addition,	we	concluded	that	a	small	portion	of	the	IPR&D	asset	is	not	commercially	feasible.	Consequently,	we	recognized	an	impairment	loss	of
$
13
	million.	
We	recognized	settlement	and	legal	expenses	of	$
30
	million	in	the	year	ended	December	31,	2018	for	the	settlement	with	the	SEC	relating	to	a
take-private	proposal	for	Tesla.	
These	expenses	were	substantially	paid	by	the	end	of	2018
.
	
125


key: chroma:document
string_value:
Note	23	–	Quarterly	Results	of	Operations	(Unaudited)
The	following	table	presents	selected	quarterly	results	of	operations	data	for	the	years	ended	December	31,	2019	and	2018	(in	millions,	except
per	share	amounts):
	
	
	
Three	Months	Ended
	
	
	
March	31
	
	
June	30
	
	
September	30
	
	
December	31
	
2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Total	revenues
	
$
4,541
	
	
$
6,350
	
	
$
6,303
	
	
$
7,384
	
Gross	profit
	
$
566
	
	
$
921
	
	
$
1,191
	
	
$
1,391
	
Net	(loss)	income	attributable	to	common
			stockholders
	
$
(
702
)
	
$
(
408
)
	
$
143
	
	
$
105
	
Net	(loss)	income	per	share	of	common	stock
			attributable	to	common	stockholders,	basic
	
$
(
4.10
)
	
$
(
2.31
)
	
$
0.80
	
	
$
0.58
	
Net	(loss)	income	per	share	of	common	stock
			attributable	to	common	stockholders,	diluted
	
$
(
4.10
)
	
$
(
2.31
)
	
$
0.78
	
	
$
0.56
	
2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
Total	revenues
	
$
3,409
	
	
$
4,002
	
	
$
6,824
	
	
$


key: chroma:document
string_value:
$
6,824
	
	
$
7,226
	
Gross	profit
	
$
456
	
	
$
619
	
	
$
1,524
	
	
$
1,443
	
Net	(loss)	income	attributable	to	common
			stockholders
	
$
(
709
)
	
$
(
718
)
	
$
311
	
	
$
140
	
Net	(loss)	income	per	share	of	common	stock
			attributable	to	common	stockholders,	basic
	
$
(
4.19
)
	
$
(
4.22
)
	
$
1.82
	
	
$
0.81
	
Net	(loss)	income	per	share	of	common	stock
			attributable	to	common	stockholders,	diluted
	
$
(
4.19
)
	
$
(
4.22
)
	
$
1.75
	
	
$
0.78
	
	
	
	
126


key: chroma:document
string_value:
I
TEM	9.
CHANGES	IN	AND	DISAGREEMENTS	WITH	ACCOUNTANTS	ON	ACCOUNTING	AND	FINANCIAL	DISCLOSURE
None.
I
TEM	9A.
CONTROLS	AND	PROCEDURES
Evaluation	of	Disclosure	Controls	and	Procedures
Our	management,	with	the	participation	of	our	Chief	Executive	Officer	and	our	Chief	Financial	Officer,	evaluated	the	effectiveness	of	our
disclosure	controls	and	procedures	pursuant	to	Rule	13a-15	under	the	Securities	Exchange	Act	of	1934,	as	amended	(the	“Exchange	Act”).	In	designing
and	evaluating	the	disclosure	controls	and	procedures,	our	management	recognizes	that	any	controls	and	procedures,	no	matter	how	well	designed	and
operated,	can	provide	only	reasonable	assurance	of	achieving	the	desired	control	objectives.	In	addition,	the	design	of	disclosure	controls	and
procedures	must	reflect	the	fact	that	there	are	resource	constraints	and	that	our	management	is	required	to	apply	its	judgment	in	evaluating	the
benefits	of	possible	controls	and	procedures	relative	to	their	costs.
Based	on	this	evaluation,	our	Chief	Executive	Officer	and	our	Chief	Financial	Officer	concluded	that,	as	of	December	31,	2019,	our	disclosure
controls	and	procedures	were	designed	at	a	reasonable	assurance	level	and	were	effective	to	provide	reasonable	assurance	that	the	information	we	are
required	to	disclose	in	reports	that	we	file	or	submit	under	the	Exchange	Act	is	recorded,	processed,	summarized	and	reported	within	the	time	periods
specified	in	the	Securities	and	Exchange	Commission	rules	and	forms,	and	that	such	information	is	accumulated	and	communicated	to	our	management,
including	our	Chief	Executive	Officer	and	our	Chief	Financial	Officer,	as	appropriate,	to	allow	timely	decisions	regarding	required	disclosures.


key: chroma:document
string_value:
Management’s	Report	on	Internal	Control	over	Financial	Reporting
Our	management	is	responsible	for	establishing	and	maintaining	adequate	internal	control	over	financial	reporting.	Internal	control	over
financial	reporting	is	a	process	designed	by,	or	under	the	supervision	of,	our	Chief	Executive	Officer	and	Chief	Financial	Officer	to	provide	reasonable
assurance	regarding	the	reliability	of	financial	reporting	and	the	preparation	of	financial	statements	for	external	purposes	in	accordance	with	generally
accepted	accounting	principles	and	includes	those	policies	and	procedures	that	(1)	pertain	to	the	maintenance	of	records	that	in	reasonable	detail
accurately	and	fairly	reflect	the	transactions	and	dispositions	of	our	assets;	(2)	provide	reasonable	assurance	that	transactions	are	recorded	as
necessary	to	permit	preparation	of	financial	statements	in	accordance	with	generally	accepted	accounting	principles,	and	that	our	receipts	and
expenditures	are	being	made	only	in	accordance	with	authorizations	of	our	management	and	directors	and	(3)	provide	reasonable	assurance	regarding
prevention	or	timely	detection	of	unauthorized	acquisition,	use	or	disposition	of	our	assets	that	could	have	a	material	effect	on	the	financial	statements.
Under	the	supervision	and	with	the	participation	of	our	management,	including	our	Chief	Executive	Officer	and	Chief	Financial	Officer,	we
conducted	an	evaluation	of	the	effectiveness	of	our	internal	control	over	financial	reporting	based	on	criteria	established	in	
Internal	Control	–
Integrated	Framework	(2013)
	issued	by	the	Committee	of	Sponsoring	Organizations	of	the	Treadway	Commission	(“COSO”).	Our	management
concluded	that	our	internal	control	over	financial	reporting	was	effective	as	of	December	31,	2019.


key: chroma:document
string_value:
Our	independent	registered	public	accounting	firm,	PricewaterhouseCoopers	LLP,	has	audited	the	effectiveness	of	our	internal	control	over
financial	reporting	as	of	December	31,	2019,	as	stated	in	their	report	which	is	included	herein.
Limitations	on	the	Effectiveness	of	Controls
Because	of	inherent	limitations,	internal	control	over	financial	reporting	may	not	prevent	or	detect	misstatements	and	projections	of	any
evaluation	of	effectiveness	to	future	periods	are	subject	to	the	risk	that	controls	may	become	inadequate	because	of	changes	in	conditions,	or	that	the
degree	of	compliance	with	the	policies	or	procedures	may	deteriorate.
127


key: chroma:document
string_value:
Changes	in	Internal	Control	over	Financial	Reporting
There	was	no	change	in	our	internal	control	over	financial	reporting	that	occurred	during	the	fourth	fiscal	quarter	of	the	year	ended
December	31,	2019,	which	has	materially	affected,	or	is	reasonably	likely	to	materially	affect,	our	internal	control	over	financial	reporting.
I
TEM	9B.
OTHER	INFORMATION
None.
	
	
	
128


key: chroma:document
string_value:
P
ART	III
I
TEM	10.
DIRECTORS,	EXECUTIVE	OFFICERS	AND	CORPORATE	GOVERNANCE
The	information	required	by	this	Item	10	of	Form	10-K	will	be	included	in	our	2020	Proxy	Statement	to	be	filed	with	the	Securities	and
Exchange	Commission	in	connection	with	the	solicitation	of	proxies	for	our	2020	Annual	Meeting	of	Stockholders	and	is	incorporated	herein	by
reference.	The	2020	Proxy	Statement	will	be	filed	with	the	Securities	and	Exchange	Commission	within	120	days	after	the	end	of	the	fiscal	year	to
which	this	report	relates.
I
TEM	11.
EXECUTIVE	COMPENSATION
The	information	required	by	this	Item	11	of	Form	10-K	will	be	included	in	our	2020	Proxy	Statement	and	is	incorporated	herein	by	reference.
I
TEM	12.
SECURITY	OWNERSHIP	OF	CERTAIN	BENEFICIAL	OWNERS	AND	MANAGEMENT	AND	RELATED	STOCKHOLDER
MATTERS
The	information	required	by	this	Item	12	of	Form	10-K	will	be	included	in	our	2020	Proxy	Statement	and	is	incorporated	herein	by	reference.
I
TEM	13.
CERTAIN	RELATIONSHIPS	AND	RELATED	TRANSACTIONS	AND	DIRECTOR	INDEPENDENCE
The	information	required	by	this	Item	13	of	Form	10-K	will	be	included	in	our	2020	Proxy	Statement	and	is	incorporated	herein	by	reference.
I
TEM	14.
PRINCIPAL	ACCOUNTANT	FEES	AND	SERVICES
The	information	required	by	this	Item	14	of	Form	10-K	will	be	included	in	our	2020	Proxy	Statement	and	is	incorporated	herein	by	reference.
ITEM	15.
EXHIBITS	AND	FINANCIAL	STATEMENT	SCHEDULES
1.
Financial	statements	(see	
Index	to	Consolidated	Financial	Statements


key: chroma:document
string_value:
Index	to	Consolidated	Financial	Statements
	in	Part	II,	Item	8	of	this	report)
2.
All	financial	statement	schedules	have	been	omitted	since	the	required	information	was	not	applicable	or	was	not	present	in	amounts	sufficient
to	require	submission	of	the	schedules,	or	because	the	information	required	is	included	in	the	consolidated	financial	statements	or	the
accompanying	notes
3.
The	exhibits	listed	in	the	following	
Index	to	Exhibits
	are	filed	or	incorporated	by	reference	as	part	of	this	report
	
	
	
129


key: chroma:document
string_value:
INDEX	TO	EXHIBITS
	
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
	
	
	
	
	
	
	
	
	
	
	
	
	
				3.1
		
Amended	and	Restated	Certificate	of	Incorporation	of
the	Registrant.
		
10-K
		
001-34756
		
3.1
		
March	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				3.2
	
Certificate	of	Amendment	to	the	Amended	and
Restated	Certificate	of	Incorporation	of	the
Registrant.
	
10-K
	
001-34756
	
3.2
	
March	1,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				3.3
		
Amended	and	Restated	Bylaws	of	the	Registrant.
		
8-K
		
001-34756
		
3.2
		
February	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.1
		
Specimen	common	stock	certificate	of	the	Registrant.
		
10-K
		
001-34756
		
4.1
		
March	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.2
		
Fifth	Amended	and	Restated	Investors’	Rights
Agreement,	dated	as	of	August	31,	2009,	between
Registrant	and	certain	holders	of	the	Registrant’s
capital	stock	named	therein.
		
S-1


key: chroma:document
string_value:
capital	stock	named	therein.
		
S-1
		
333-164593
		
4.2
		
January	29,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.3
		
Amendment	to	Fifth	Amended	and	Restated	Investors’
Rights	Agreement,	dated	as	of	May	20,	2010,	between
Registrant	and	certain	holders	of	the	Registrant’s
capital	stock	named	therein.
		
S-1/A
		
333-164593
		
4.2A
		
May	27,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.4
		
Amendment	to	Fifth	Amended	and	Restated	Investors’
Rights	Agreement	between	Registrant,	Toyota	Motor
Corporation	and	certain	holders	of	the	Registrant’s
capital	stock	named	therein.
		
S-1/A
		
333-164593
		
4.2B
		
May	27,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.5
		
Amendment	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	June	14,	2010,
between	Registrant	and	certain	holders	of	the
Registrant’s	capital	stock	named	therein.
		
S-1/A
		
333-164593
		
4.2C
		
June	15,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.6
		
Amendment	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	November	2,	2010,


key: chroma:document
string_value:
between	Registrant	and	certain	holders	of	the
Registrant’s	capital	stock	named	therein.
		
8-K
		
001-34756
		
4.1
		
November	4,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.7
		
Waiver	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	May	22,	2011,	between
Registrant	and	certain	holders	of	the	Registrant’s
capital	stock	named	therein.
		
S-1/A
		
333-174466
		
4.2E
		
June	2,	2011
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.8
		
Amendment	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	May	30,	2011,	between
Registrant	and	certain	holders	of	the	Registrant’s
capital	stock	named	therein.
		
8-K
		
001-34756
		
4.1
		
June	1,	2011
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
130


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.9
		
Sixth	Amendment	to	Fifth	Amended	and	Restated
Investors’	Rights	Agreement,	dated	as	of	May	15,
2013	among	the	Registrant,	the	Elon	Musk	Revocable
Trust	dated	July	22,	2003	and	certain	other	holders	of
the	capital	stock	of	the	Registrant	named	therein.
		
8-K
		
001-34756
		
4.1
		
May	20,	2013
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.10
		
Waiver	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	May	14,	2013,	between
the	Registrant	and	certain	holders	of	the	capital	stock
of	the	Registrant	named	therein.
		
8-K
		
001-34756
		
4.2
		
May	20,	2013
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.11
		
Waiver	to	Fifth	Amended	and	Restated	Investor’s
Rights	Agreement,	dated	as	of	August	13,	2015,
between	the	Registrant	and	certain	holders	of	the
capital	stock	of	the	Registrant	named	therein.
		
8-K
		
001-34756
		
4.1
		
August	19,	2015
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.12
		
Waiver	to	Fifth	Amended	and	Restated	Investors’


key: chroma:document
string_value:
Rights	Agreement,	dated	as	of	May	18,	2016,	between
the	Registrant	and	certain	holders	of	the	capital	stock
of	the	Registrant	named	therein.
		
8-K
		
001-34756
		
4.1
		
May	24,	2016
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.13
	
Waiver	to	Fifth	Amended	and	Restated	Investors’
Rights	Agreement,	dated	as	of	March	15,	2017,
between	the	Registrant	and	certain	holders	of	the
capital	stock	of	the	Registrant	named	therein.
	
8-K
		
001-34756
		
4.1
		
March	17,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.14
	
Waiver	to	Fifth	Amended	and	Restated	Investors’
Rights	Agreement,	dated	as	of	May	1,	2019,	between
the	Registrant	and	certain	holders	of	the	capital	stock
of	the	Registrant	named	therein.
	
8-K
		
001-34756
		
4.1
		
May	3,	2019
		
	
				4.15
		
Indenture,	dated	as	of	May	22,	2013,	by	and	between
the	Registrant	and	U.S.	Bank	National	Association.
		
8-K
		
001-34756
		
4.1
		
May	22,	2013
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.16
	
Third	Supplemental	Indenture,	dated	as	of	March	5,
2014,	by	and	between	the	Registrant	and	U.S.	Bank
National	Association.
	
8-K
	
001-34756


key: chroma:document
string_value:
8-K
	
001-34756
	
4.4
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.17
	
Form	of	1.25%	Convertible	Senior	Note	Due	March	1,
2021	(included	in	Exhibit	4.19).
	
8-K
	
001-34756
	
4.4
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.18
	
Fourth	Supplemental	Indenture,	dated	as	of
March	22,	2017,	by	and	between	the	Registrant	and
U.S.	Bank	National	Association.
	
8-K
	
001-34756
	
4.2
	
March	22,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.19
	
Form	of	2.375%	Convertible	Senior	Note	Due
March	15,	2022	(included	in	Exhibit	4.21).
	
8-K
	
001-34756
	
4.2
	
March	22,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
131


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.2
0
	
Indenture,	dated	as	of	August	18,	2017,	by	and	among
the	Registrant,	SolarCity,	and	U.S.	Bank	National
Association,	as	trustee.
	
8-K
	
001-34756
	
4.1
	
August	23,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.21
	
Form	of	5.30%	Senior	Note	due	August	15,	2025
.
	
8-K
	
001-34756
	
4.2
	
August	23,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.22
	
Indenture,	dated	as	of	September	30,	2014,	between
SolarCity	and	Wells	Fargo	Bank,	National	Association
	
8-K(1)
	
001-35758
	
4.1
	
October	6,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.23
	
First	Supplemental	Indenture,	dated	as	of	November
21,	2016,	between	SolarCity	and	Wells	Fargo	Bank,
National	Association,	as	trustee	to	the	Indenture,
dated	as	of	September	30,	2014,	between	SolarCity
and	Wells	Fargo	Bank,	National	Association,	as
trustee.
	
8-K
	
001-34756
	
4.2
	
November	21,	2016


key: chroma:document
string_value:
4.24
	
Indenture,	dated	as	of	December	7,	2015,	between
SolarCity	and	Wells	Fargo	Bank,	National	Association
	
8-K(1)
	
001-35758
	
4.1
	
December	7,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.25
	
First	Supplemental	Indenture,	dated	as	of	November
21,	2016,	between	SolarCity	and	Wells	Fargo	Bank,
National	Association,	as	trustee	to	the	Indenture,
dated	as	of	December	7,	2015,	between	SolarCity	and
Wells	Fargo	Bank,	National	Association,	as	trustee.
	
8-K
	
001-34756
	
4.3
	
November	21,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.26
	
Indenture,	dated	as	of	October	15,	2014,	between
SolarCity	and	U.S.	Bank	National	Association,	as
trustee.
	
S-3ASR(1)
	
333-199321
	
4.1
	
October	15,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.27
	
Fifth	Supplemental	Indenture,	dated	as	of	May	7,
2019,	by	and	between	Registrant	and	U.S.	Bank
National	Association,	related	to	2.00%	Convertible
Senior	Notes	due	May	15,	2024.
	
8-K
	
001-34756
	
4.2
	
May	8,	2019


key: chroma:document
string_value:
4.28
	
Form	of	2.00%	Convertible	Senior	Notes	due	May	15,
2024	(included	in	Exhibit	4.27).
	
8-K
	
001-34756
	
4.3
	
May	8,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.29
	
Fourth	Supplemental	Indenture,	dated	as	of	October
15,	2014,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.00%	Solar	Bonds,	Series
2014/4-7
.
	
8-K(1)
	
001-35758
	
4.5
	
October	15,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.30
	
Eighth	Supplemental	Indenture,	dated	as	of	January
29,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.00%	Solar	Bonds,	Series
2015/4-7.
	
8-K(1)
	
001-35758
	
4.5
	
January	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
132


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.3
1
	
Ninth	Supplemental	Indenture,	dated	as	of	March	9,
2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.00%	Solar	Bonds,	Series
2015/5-5.
	
8-K(1)
	
001-35758
	
4.2
	
March	9,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.32
	
Tenth	Supplemental	Indenture,	dated	as	of	March	9,
2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.00%	Solar	Bonds,	Series
2015/6-10.
	
8-K(1)
	
001-35758
	
4.3
	
March	9,	2015
	
	
				4.33
	
Eleventh	Supplemental	Indenture,	dated	as	of	March
9,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.75%	Solar	Bonds,	Series
2015/7-15.
	
8-K(1)
	
001-35758
	
4.4
	
March	9,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.34
	
Fourteenth	Supplemental	Indenture,	dated	as	of
March	19,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C3-5.


key: chroma:document
string_value:
Series	2015/C3-5.
	
8-K(1)
	
001-35758
	
4.4
	
March	19,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.35
	
Fifteenth	Supplemental	Indenture,	dated	as	of	March
19,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C4-10.
	
8-K(1)
	
001-35758
	
4.5
	
March	19,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.36
	
Sixteenth	Supplemental	Indenture,	dated	as	of	March
19,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C5-15.
	
8-K(1)
	
001-35758
	
4.6
	
March	19,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.37
	
Nineteenth	Supplemental	Indenture,	dated	as	of
March	26,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C8-5.
	
8-K(1)
	
001-35758
	
4.4
	
March	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.38
	
Twentieth	Supplemental	Indenture,	dated	as	of	March


key: chroma:document
string_value:
26,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C9-10.
	
8-K(1)
	
001-35758
	
4.5
	
March	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.39
	
Twenty-First	Supplemental	Indenture,	dated	as	of
March	26,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C10-15.
	
8-K(1)
	
001-35758
	
4.6
	
March	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.40
	
Twenty-Fifth	Supplemental	Indenture,	dated	as	of
April	2,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C13-5.
	
8-K(1)
	
001-35758
	
4.4
	
April	2,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
133


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.4
1
	
Twenty-Sixth	Supplemental	Indenture,	dated	as	of
April	2,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.70%	Solar	Bonds,
Series	2015/C14-10.
	
8-K(1)
	
001-35758
	
4.5
	
April	2,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.42
	
Twenty-Ninth	Supplemental	Indenture,	dated	as	of
April	9,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C18-5.
	
8-K(1)
	
001-35758
	
4.4
	
April	9,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.43
	
Thirtieth	Supplemental	Indenture,	dated	as	of	April	9,
2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C19-10.
	
8-K(1)
	
001-35758
	
4.5
	
April	9,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.44
	
Thirty-First	Supplemental	Indenture,	dated	as	of	April


key: chroma:document
string_value:
9,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C20-15.
	
8-K(1)
	
001-35758
	
4.6
	
April	9,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.45
	
Thirty-Fourth	Supplemental	Indenture,	dated	as	of
April	14,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C23-5.
	
8-K(1)
	
001-35758
	
4.4
	
April	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.46
	
Thirty-Fifth	Supplemental	Indenture,	dated	as	of	April
14,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C24-10.
	
8-K(1)
	
001-35758
	
4.5
	
April	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.47
	
Thirty-Sixth	Supplemental	Indenture,	dated	as	of
April	14,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C25-15.
	
8-K(1)
	
001-35758
	
4.6
	
April	14,	2015


key: chroma:document
string_value:
4.48
	
Thirty-Eighth	Supplemental	Indenture,	dated	as	of
April	21,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.70%	Solar	Bonds,
Series	2015/C27-10.
	
8-K(1)
	
001-35758
	
4.3
	
April	21,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.49
	
Thirty-Ninth	Supplemental	Indenture,	dated	as	of
April	21,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C28-15.
	
8-K(1)
	
001-35758
	
4.4
	
April	21,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.50
	
Forty-Second	Supplemental	Indenture,	dated	as	of
April	27,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C31-5.
	
8-K(1)
	
001-35758
	
4.4
	
April	27,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
134


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.5
1
	
Forty-Third	Supplemental	Indenture,	dated	as	of	April
27,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C32-10.
	
8-K(1)
	
001-35758
	
4.5
	
April	27,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.52
	
Forty-Fourth	Supplemental	Indenture,	dated	as	of
April	27,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C33-15.
	
8-K(1)
	
001-35758
	
4.6
	
April	27,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.53
	
Forty-Seventh	Supplemental	Indenture,	dated	as	of
May	1,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.00%	Solar	Bonds,
Series	2015/11-5.
	
8-K(1)
	
001-35758
	
4.4
	
May	1,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.54
	
Forty-Eighth	Supplemental	Indenture,	dated	as	of


key: chroma:document
string_value:
May	1,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.00%	Solar	Bonds,
Series	2015/12-10.
	
8-K(1)
	
001-35758
	
4.5
	
May	1,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.55
	
Forty-Ninth	Supplemental	Indenture,	dated	as	of	May
1,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.75%	Solar	Bonds,	Series
2015/13-15.
	
8-K(1)
	
001-35758
	
4.6
	
May	1,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.56
	
Fifty-First	Supplemental	Indenture,	dated	as	of	May
11,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	3.60%	Solar	Bonds,	Series
2015/C35-5.
	
8-K(1)
	
001-35758
	
4.3
	
May	11,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.57
	
Fifty-Second	Supplemental	Indenture,	dated	as	of
May	11,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.70%	Solar	Bonds,
Series	2015/C36-10
.
	
8-K(1)
	
001-35758
	
4.4
	
May	11,	2015


key: chroma:document
string_value:
4.58
	
Fifty-Third	Supplemental	Indenture,	dated	as	of	May
11,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C37-15.
	
8-K(1)
	
001-35758
	
4.5
	
May	11,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.59
	
Fifty-Sixth	Supplemental	Indenture,	dated	as	of	May
18,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	3.60%	Solar	Bonds,	Series
2015/C39-5.
	
8-K(1)
	
001-35758
	
4.3
	
May	18,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.60
	
Fifty-Seventh	Supplemental	Indenture,	dated	as	of
May	18,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.70%	Solar	Bonds,
Series	2015/C40-10.
	
8-K(1)
	
001-35758
	
4.4
	
May	18,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
135


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.
61
	
Fifty-Eighth	Supplemental	Indenture,	dated	as	of	May
18,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C41-15.
	
8-K(1)
	
001-35758
	
4.5
	
May	18,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.62
	
Sixtieth	Supplemental	Indenture,	dated	as	of	May	26,
2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	3.60%	Solar	Bonds,	Series
2015/C43-5.
	
8-K(1)
	
001-35758
	
4.3
	
May	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.63
	
Sixty-First	Supplemental	Indenture,	dated	as	of	May
26,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C44-10.
	
8-K(1)
	
001-35758
	
4.4
	
May	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.64
	
Sixty-Second	Supplemental	Indenture,	dated	as	of
May	26,	2015,	by	and	between	SolarCity	and	the


key: chroma:document
string_value:
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C45-15.
	
8-K(1)
	
001-35758
	
4.5
	
May	26,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.65
	
Sixty-Fifth	Supplemental	Indenture,	dated	as	of	June
8,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	3.60%	Solar	Bonds,	Series
2015/C47-5.
	
8-K(1)
	
001-35758
	
4.3
	
June	10,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.66
	
Sixty-Seventh	Supplemental	Indenture,	dated	as	of
June	8,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C49-15.
	
8-K(1)
	
001-35758
	
4.5
	
June	10,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.67
	
Seventieth	Supplemental	Indenture,	dated	as	of	June
16,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C52-10.
	
8-K(1)
	
001-35758
	
4.4
	
June	16,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.68


key: chroma:document
string_value:
4.68
	
Seventy-First	Supplemental	Indenture,	dated	as	of
June	16,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C53-15.
	
8-K(1)
	
001-35758
	
4.5
	
June	16,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.69
	
Seventy-Fourth	Supplemental	Indenture,	dated	as	of
June	22,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.70%	Solar	Bonds,
Series	2015/C56-10.
	
8-K(1)
	
001-35758
	
4.4
	
June	23,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.70
	
Seventy-Fifth	Supplemental	Indenture,	dated	as	of
June	22,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	5.45%	Solar	Bonds,
Series	2015/C57-15
.
	
8-K(1)
	
001-35758
	
4.5
	
June	23,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
136


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.
71
	
Seventy-Ninth	Supplemental	Indenture,	dated	as	of
June	29,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C60-5.
	
8-K(1)
	
001-35758
	
4.4
	
June	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.72
	
Eightieth	Supplemental	Indenture,	dated	as	of	June
29,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C61-10.
	
8-K(1)
	
001-35758
	
4.5
	
June	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.73
	
Eighty-First	Supplemental	Indenture,	dated	as	of	June
29,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C62-15.
	
8-K(1)
	
001-35758
	
4.6
	
June	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.74
	
Eighty-Fourth	Supplemental	Indenture,	dated	as	of
July	14,	2015,	by	and	between	SolarCity	and	the


key: chroma:document
string_value:
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C65-5.
	
8-K(1)
	
001-35758
	
4.4
	
July	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.75
	
Eighty-Sixth	Supplemental	Indenture,	dated	as	of	July
14,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C67-15.
	
8-K(1)
	
001-35758
	
4.6
	
July	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.76
	
Eighty-Ninth	Supplemental	Indenture,	dated	as	of	July
20,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	3.60%	Solar	Bonds,	Series
2015/C70-5.
	
8-K(1)
	
001-35758
	
4.4
	
July	21,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.77
	
Ninetieth	Supplemental	Indenture,	dated	as	of	July
20,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	4.70%	Solar	Bonds,	Series
2015/C71-10.
	
8-K(1)
	
001-35758
	
4.5
	
July	21,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.78


key: chroma:document
string_value:
4.78
	
Ninety-First	Supplemental	Indenture,	dated	as	of	July
20,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.45%	Solar	Bonds,	Series
2015/C72-15.
	
8-K(1)
	
001-35758
	
4.6
	
July	21,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.79
	
Ninety-Fourth	Supplemental	Indenture,	dated	as	of
July	31,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	4.00%	Solar	Bonds,
Series	2015/19-5.
	
8-K(1)
	
001-35758
	
4.4
	
July	31,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.80
	
Ninety-Fifth	Supplemental	Indenture,	dated	as	of	July
31,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.00%	Solar	Bonds,	Series
2015/20-10.
	
8-K(1)
	
001-35758
	
4.5
	
July	31,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
137


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.
81
	
Ninety-Sixth	Supplemental	Indenture,	dated	as	of	July
31,	2015,	by	and	between	SolarCity	and	the	Trustee,
related	to	SolarCity’s	5.75%	Solar	Bonds,	Series
2015/21-15.
	
8-K(1)
	
001-35758
	
4.6
	
July	31,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.82
	
Ninety-Ninth	Supplemental	Indenture,	dated	as	of
August	3,	2015,	by	and	between	SolarCity	and	the
Trustee,	related	to	SolarCity’s	3.60%	Solar	Bonds,
Series	2015/C75-5.
	
8-K(1)
	
001-35758
	
4.4
	
August	3,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.83
	
One	Hundred-and-Fifth	Supplemental	Indenture,
dated	as	of	August	10,	2015,	by	and	between
SolarCity	and	the	Trustee,	related	to	SolarCity’s
4.70%	Solar	Bonds,	Series	2015/C81-10.
	
8-K(1)
	
001-35758
	
4.5
	
August	10,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.84
	
One	Hundred-and-Ninth	Supplemental	Indenture,


key: chroma:document
string_value:
One	Hundred-and-Ninth	Supplemental	Indenture,
dated	as	of	August	17,	2015,	by	and	between
SolarCity	and	the	Trustee,	related	to	SolarCity’s
3.60%	Solar	Bonds,	Series	2015/C85-5.
	
8-K(1)
	
001-35758
	
4.4
	
August	17,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.85
	
One	Hundred-and-Eleventh	Supplemental	Indenture,
dated	as	of	August	17,	2015,	by	and	between
SolarCity	and	the	Trustee,	related	to	SolarCity’s
5.45%	Solar	Bonds,	Series	2015/C87-15.
	
8-K(1)
	
001-35758
	
4.6
	
August	17,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.86
	
One	Hundred-and-Fourteenth	Supplemental
Indenture,	dated	as	of	August	24,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C90-5.
	
8-K(1)
	
001-35758
	
4.4
	
August	24,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.87
	
One	Hundred-and-Sixteenth	Supplemental	Indenture,
dated	as	of	August	24,	2015,	by	and	between
SolarCity	and	the	Trustee,	related	to	SolarCity’s
5.45%	Solar	Bonds,	Series	2015/C92-15.
	
8-K(1)
	
001-35758
	
4.6


key: chroma:document
string_value:
001-35758
	
4.6
	
August	24,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.88
	
One	Hundred-and-Nineteenth	Supplemental
Indenture,	dated	as	of	August	31,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C95-5.
	
8-K(1)
	
001-35758
	
4.4
	
August	31,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.89
	
One	Hundred-and-Twenty-First	Supplemental
Indenture,	dated	as	of	August	31,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C97-15.
	
8-K(1)
	
001-35758
	
4.6
	
August	31,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
138


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.
90
	
One	Hundred-and-Twenty-Seventh	Supplemental
Indenture,	dated	as	of	September	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C100-5.
	
8-K(1)
	
001-35758
	
4.4
	
September	15,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.91
	
One	Hundred-and-Twenty-Eighth	Supplemental
Indenture,	dated	as	of	September	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C101-10.
	
8-K(1)
	
001-35758
	
4.5
	
September	15,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.92
	
One	Hundred-and-Twenty-Ninth	Supplemental
Indenture,	dated	as	of	September	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C102-15.
	
8-K(1)
	
001-35758
	
4.6
	
September	15,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.93
	
One	Hundred-and-Thirty-Second	Supplemental


key: chroma:document
string_value:
One	Hundred-and-Thirty-Second	Supplemental
Indenture,	dated	as	of	September	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C105-5.
	
8-K(1)
	
001-35758
	
4.4
	
September	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.94
	
One	Hundred-and-Thirty-Third	Supplemental
Indenture,	dated	as	of	September	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C106-10.
	
8-K(1)
	
001-35758
	
4.5
	
September	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.95
	
One	Hundred-and-Thirty-Fourth	Supplemental
Indenture,	dated	as	of	September	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C107-15.
	
8-K(1)
	
001-35758
	
4.6
	
September	29,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.96
	
One	Hundred-and-Thirty-Seventh	Supplemental
Indenture,	dated	as	of	October	13,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C110-5.
	
8-K(1)
	
001-35758


key: chroma:document
string_value:
8-K(1)
	
001-35758
	
4.4
	
October	13,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.97
	
One	Hundred-and-Thirty-Eighth	Supplemental
Indenture,	dated	as	of	October	13,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C111-10.
	
8-K(1)
	
001-35758
	
4.5
	
October	13,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
139


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.
98
	
One	Hundred-and-Forty-Second	Supplemental
Indenture,	dated	as	of	October	30,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.00%	Solar	Bonds,	Series	2015/24-5.
	
8-K(1)
	
001-35758
	
4.4
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.99
	
One	Hundred-and-Forty-Third	Supplemental
Indenture,	dated	as	of	October	30,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.00%	Solar	Bonds,	Series	2015/25-10.
	
8-K(1)
	
001-35758
	
4.5
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.100
	
One	Hundred-and-Forty-Fourth	Supplemental
Indenture,	dated	as	of	October	30,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.75%	Solar	Bonds,	Series	2015/26-15.
	
8-K(1)
	
001-35758
	
4.6
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.101
	
One	Hundred-and-Forty-Seventh	Supplemental


key: chroma:document
string_value:
One	Hundred-and-Forty-Seventh	Supplemental
Indenture,	dated	as	of	November	4,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C115-5.
	
8-K(1)
	
001-35758
	
4.4
	
November	4,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.102
	
One	Hundred-and-Forty-Eighth	Supplemental
Indenture,	dated	as	of	November	4,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C116-10.
	
8-K(1)
	
001-35758
	
4.5
	
November	4,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.103
	
One	Hundred-and-Fifty-Third	Supplemental
Indenture,	dated	as	of	November	16,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C121-10.
	
8-K(1)
	
001-35758
	
4.5
	
November	17,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.104
	
One	Hundred-and-Fifty-Fourth	Supplemental
Indenture,	dated	as	of	November	16,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C122-15.
	
8-K(1)


key: chroma:document
string_value:
8-K(1)
	
001-35758
	
4.6
	
November	17,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.105
	
One	Hundred-and-Fifty-Eighth	Supplemental
Indenture,	dated	as	of	November	30,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C126-10.
	
8-K(1)
	
001-35758
	
4.5
	
November	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
140


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.1
06
	
One	Hundred-and-Fifty-Ninth	Supplemental
Indenture,	dated	as	of	November	30,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C127-15.
	
8-K(1)
	
001-35758
	
4.6
	
November	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.107
	
One	Hundred-and-Sixty-Second	Supplemental
Indenture,	dated	as	of	December	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C130-5.
	
8-K(1)
	
001-35758
	
4.4
	
December	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.058
	
One	Hundred-and-Sixty-Third	Supplemental
Indenture,	dated	as	of	December	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C131-10.
	
8-K(1)
	
001-35758
	
4.5
	
December	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.109
	
One	Hundred-and-Sixty-Fourth	Supplemental


key: chroma:document
string_value:
One	Hundred-and-Sixty-Fourth	Supplemental
Indenture,	dated	as	of	December	14,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C132-15.
	
8-K(1)
	
001-35758
	
4.6
	
December	14,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.110
	
One	Hundred-and-Sixty-Seventh	Supplemental
Indenture,	dated	as	of	December	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	3.60%	Solar	Bonds,	Series	2015/C135-5.
	
8-K(1)
	
001-35758
	
4.4
	
December	28,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.111
	
One	Hundred-and-Sixty-Eighth	Supplemental
Indenture,	dated	as	of	December	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.70%	Solar	Bonds,	Series	2015/C136-10.
	
8-K(1)
	
001-35758
	
4.5
	
December	28,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.112
	
One	Hundred-and-Sixty-Ninth	Supplemental
Indenture,	dated	as	of	December	28,	2015,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.45%	Solar	Bonds,	Series	2015/C137-15.
	
8-K(1)
	
001-35758


key: chroma:document
string_value:
8-K(1)
	
001-35758
	
4.6
	
December	28,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.113
	
One	Hundred-and-Seventy-Second	Supplemental
Indenture,	dated	as	of	January	29,	2016,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	4.00%	Solar	Bonds,	Series	2016/3-5.
	
8-K(1)
	
001-35758
	
4.4
	
January	29,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
141


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
				4.1
14
	
One	Hundred-and-Seventy-Third	Supplemental
Indenture,	dated	as	of	January	29,	2016,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.00%	Solar	Bonds,	Series	2016/4-10.
	
8-K(1)
	
001-35758
	
4.5
	
January	29,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.115
	
One	Hundred-and-Seventy-Fourth	Supplemental
Indenture,	dated	as	of	January	29,	2016,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.75%	Solar	Bonds,	Series	2016/5-15.
	
8-K(1)
	
001-35758
	
4.6
	
January	29,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.116
	
One	Hundred-and-Seventy-Seventh	Supplemental
Indenture,	dated	as	of	February	26,	2016,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.25%	Solar	Bonds,	Series	2016/8-5.
	
8-K(1)
	
001-35758
	
4.4
	
February	26,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.117
	
One	Hundred-and-Seventy-Ninth	Supplemental


key: chroma:document
string_value:
One	Hundred-and-Seventy-Ninth	Supplemental
Indenture,	dated	as	of	March	21,	2016,	by	and
between	SolarCity	and	the	Trustee,	related	to
SolarCity’s	5.25%	Solar	Bonds,	Series	2016/10-5.
	
8-K(1)
	
001-35758
	
4.3
	
March	21,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.118
	
One	Hundred-and-Eighty-First	Supplemental
Indenture,	dated	as	of	June	10,	2016,	by	and	between
SolarCity	and	the	Trustee,	related	to	SolarCity’s
5.25%	Solar	Bonds,	Series	2016/12-5.
	
8-K(1)
	
001-35758
	
4.3
	
June	10,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
				4.119
	
Description	of	Registrant’s	Securities
	
—
	
—
	
—
	
—
	
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.1**
		
Form	of	Indemnification	Agreement	between	the
Registrant	and	its	directors	and	officers.
		
S-1/A
		
333-164593
		
10.1
		
June	15,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.2**
		
2003	Equity	Incentive	Plan.
		
S-1/A
		
333-164593
		
10.2
		
May	27,	2010


key: chroma:document
string_value:
10.3**
		
Form	of	Stock	Option	Agreement	under	2003	Equity
Incentive	Plan.
		
S-1
		
333-164593
		
10.3
		
January	29,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.4**
		
Amended	and	Restated	2010	Equity	Incentive	Plan.
		
10-K
		
001-34756
		
10.4
	
February	23,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.5**
		
Form	of	Stock	Option	Agreement	under	2010	Equity
Incentive	Plan.
		
10-K
		
001-34756
		
10.6
		
March	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.6**
		
Form	of	Restricted	Stock	Unit	Award	Agreement
under	2010	Equity	Incentive	Plan.
		
10-K
		
001-34756
		
10.7
		
March	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.7**
		
Amended	and	Restated	2010	Employee	Stock
Purchase	Plan,	effective	as	of	February	1,	2017.
	
10-K
		
001-34756
		
10.8
		
March	1,	2017
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.8**
		
2019	Equity	Incentive	Plan.


key: chroma:document
string_value:
2019	Equity	Incentive	Plan.
		
S-8
		
333-232079
		
4.2
	
June	12,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
142


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.9**
		
Form	of	Stock	Option	Agreement	under	2019	Equity
Incentive	Plan.
		
S-8
		
333-232079
		
4.3
		
June	12,	2019
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.10**
		
Form	of	Restricted	Stock	Unit	Award	Agreement
under	2019	Equity	Incentive	Plan.
		
S-8
		
333-232079
		
4.4
		
June	12,	2019
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.11**
		
Employee	Stock	Purchase	Plan,	effective	as	of	June
12,	2019.
		
S-8
		
333-232079
		
4.5
		
June	12,	2019
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.12**
	
2007	SolarCity	Stock	Plan	and	form	of	agreements
used	thereunder.
	
S-1(1)
	
333-184317
	
10.2
	
October	5,	2012
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.13**
	
2012	SolarCity	Equity	Incentive	Plan	and	form	of
agreements	used	thereunder.
	
S-1(1)
	
333-184317
	
10.3
	
October	5,	2012


key: chroma:document
string_value:
10.14**
	
2010	Zep	Solar,	Inc.	Equity	Incentive	Plan	and	form
of	agreements	used	thereunder.
	
S-8(1)
	
333-192996
	
4.5
	
December	20,	2013
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.15**
		
Offer	Letter	between	the	Registrant	and	Elon	Musk
dated	October	13,	2008.
		
S-1
		
333-164593
		
10.9
		
January	29,	2010
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.16**
	
Performance	Stock	Option	Agreement	between	the
Registrant	and	Elon	Musk	dated	January	21,	2018.
	
DEF	14A
	
001-34756
	
Appendix	A
	
February	8,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.17
	
Indemnification	Agreement,	dated	as	of	February	27,
2014,	by	and	between	the	Registrant	and	J.P.	Morgan
Securities	LLC.
	
8-K
	
001-34756
	
10.1
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.18
	
Form	of	Call	Option	Confirmation	relating	to	0.25%
Convertible	Senior	Notes	Due	March	1,	2019.
	
8-K
	
001-34756
	
10.2
	
March	5,	2014


key: chroma:document
string_value:
10.2
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.19
	
Form	of	Call	Option	Confirmation	relating	to	1.25%
Convertible	Senior	Notes	Due	March	1,	2021.
	
8-K
	
001-34756
	
10.3
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.20
	
Form	of	Warrant	Confirmation	relating	to	0.25%
Convertible	Senior	Notes	Due	March	1,	2019.
	
8-K
	
001-34756
	
10.4
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.21
	
Form	of	Warrant	Confirmation	relating	to	1.25%
Convertible	Senior	Notes	Due	March	1,	2021.
	
8-K
	
001-34756
	
10.5
	
March	5,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.22
	
Form	of	Call	Option	Confirmation	relating	to	2.375%
Convertible	Notes	due	March	15,	2022
.
	
8-K
	
001-34756
	
10.1
	
March	22,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.23
	
Form	of	Warrant	Confirmation	relating	to	2.375%
Convertible	Notes	due	March	15,	2022.
	
8-K
	
001-34756
	
10.2


key: chroma:document
string_value:
001-34756
	
10.2
	
March	22,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.24
	
Form	of	Call	Option	Confirmation	relating	to	2.00%
Convertible	Senior	Notes	due	May	15,	2024
.
	
8-K
	
001-34756
	
10.1
	
May	3,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
143


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.25
	
Form	of	Warrant	Confirmation	relating	to	
2.00%
Convertible	Senior	Notes	due	May	15,	2024
.
	
8-K
	
001-34756
	
10.2
	
May	3,	2019
	
	
		10.26†
		
Supply	Agreement	between	Panasonic	Corporation
and	the	Registrant	dated	October	5,	2011.
		
10-K
		
-001-34756
		
10.50
		
February	27,	2012
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.27†
		
Amendment	No.	1	to	Supply	Agreement	between
Panasonic	Corporation	and	the	Registrant	dated
October	29,	2013.
		
10-K
		
001-34756
		
10.35A
		
February	26,	2014
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.28
	
Agreement	between	Panasonic	Corporation	and	the
Registrant	dated	July	31,	2014.
	
10-Q
	
001-34756
	
10.1
	
November	7,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.29†
	
General	Terms	and	Conditions	between	Panasonic
Corporation	and	the	Registrant	dated	October	1,
2014.
	
8-K
	
001-34756
	
10.2
	
October	11,	2016


key: chroma:document
string_value:
10.30
	
Letter	Agreement,	dated	as	of	February	24,	2015,
regarding	addition	of	co-party	to	General	Terms	and
Conditions,	Production	Pricing	Agreement	and
Investment	Letter	Agreement	between	Panasonic
Corporation	and	the	Registrant.
	
10-K
	
001-34756
	
10.25A
	
February	24,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.31†
	
Amendment	to	Gigafactory	General	Terms,	dated
March	1,	2016,	by	and	among	the	Registrant,
Panasonic	Corporation	and	Panasonic	Energy
Corporation	of	North	America.
	
8-K
	
001-34756
	
10.1
	
October	11,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.32†
	
Production	Pricing	Agreement	between	Panasonic
Corporation	and	the	Registrant	dated	October	1,
2014.
	
10-Q
	
001-34756
	
10.3
	
November	7,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.33†
	
Investment	Letter	Agreement	between	Panasonic
Corporation	and	the	Registrant	dated	October	1,
2014.
	
10-Q
	
001-34756
	
10.4
	
November	7,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.34


key: chroma:document
string_value:
10.34
	
Amendment	to	Gigafactory	Documents,	dated	April	5,
2016,	by	and	among	the	Registrant,	Panasonic
Corporation,	Panasonic	Corporation	of	North	America
and	Panasonic	Energy	Corporation	of	North	America.
	
10-Q
	
001-34756
	
10.2
	
May	10,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.35††
	
2019	Pricing	Agreement	(2170	Cells)	with	respect	to
2014	Gigafactory	Agreements,	executed	September
20,	2019,	by	and	among	the	Registrant,	Tesla	Motors
Netherlands	B.V.,	Panasonic	Corporation	and
Panasonic	Corporation	of	North	America,	on	behalf	of
its	division	Panasonic	Energy	Corporation	of	North
America.
	
10-Q
	
001-34756
	
10.5
	
October	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
144


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.36††
	
2019	Pricing	Agreement	(Japan	Cells)	with	respect	to
2011	Supply	Agreement,	executed	September	20,
2019,	by	and	among	the	Registrant,	Tesla	Motors
Netherlands	B.V.,	Panasonic	Corporation	and	SANYO
Electric	Co.,	Ltd.
	
10-Q
	
001-34756
	
10.6
	
October	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.37††
	
Amended	and	Restated	Factory	Lease,	executed	as	of
March	26,	10`9,	by	and	between	Tesla,	Inc.	and
Panasonic	Energy	North	America,	a	division	of
Panasonic	Corporation	of	North	America,	as	tenant.
	
10-Q
	
001-34756
	
10.3
	
July	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.38††
	
Lease	Amendment,	executed	September	20,	2019,	by
and	among	the	Registrant,	Panasonic	Corporation	of
North	America,	on	behalf	of	its	division	Panasonic
Energy	of	North	America,	with	respect	to	the
Amended	and	Restated	Factory	Lease,	executed	as	of
March	26,	2019.
	
10-Q
	
001-34756
	
10.7
	
October	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.39


key: chroma:document
string_value:
10.39
	
ABL	Credit	Agreement,	dated	as	of	June	10,	2015,	by
and	among	the	Registrant,	Tesla	Motors	Netherlands
B.V.,	certain	of	the	Registrant’s	and	Tesla	Motors
Netherlands	B.V.’s	direct	or	indirect	subsidiaries	from
time	to	time	party	thereto,	as	borrowers,	Wells	Fargo
Bank,	National	Association,	as	documentation	agent,
JPMorgan	Chase	Bank,	N.A.,	Goldman	Sachs	Bank
USA,	Morgan	Stanley	Senior	Funding	Inc.	and	Bank
of	America,	N.A.,	as	syndication	agents,	the	lenders
from	time	to	time	party	thereto,	and	Deutsche	Bank
AG	New	York	Branch,	as	administrative	agent	and
collateral	agent.
	
8-K
	
001-34756
	
10.1
	
June	12,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.40
	
First	Amendment,	dated	as	of	November	3,	2015,	to
ABL	Credit	Agreement,	dated	as	of	June	10,	2015,	by
and	among	the	Registrant,	Tesla	Motors	Netherlands
B.V.,	certain	of	the	Registrant’s	and	Tesla	Motors
Netherlands	B.V.’s	direct	or	indirect	subsidiaries	from
time	to	time	party	thereto,	as	borrowers,	and	the
documentation	agent,	syndication	agents,
administrative	agent,	collateral	agent	and	lenders
from	time	to	time	party	thereto.
	
10-Q
	
001-34756
	
10.1
	
November	5,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
145


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.
41
	
Second	Amendment,	dated	as	of	December	31,	2015,
to	ABL	Credit	Agreement,	dated	as	of	June	10,	2015,
by	and	among	the	Registrant,	Tesla	Motors
Netherlands	B.V.,	certain	of	the	Registrant’s	and
Tesla	Motors	Netherlands	B.V.’s	direct	or	indirect
subsidiaries	from	time	to	time	party	thereto,	as
borrowers,	and	the	documentation	agent,	syndication
agents,	administrative	agent,	collateral	agent	and
lenders	from	time	to	time	party	thereto.
	
10-K
	
001-34756
	
10.28B
	
February	24,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.42
	
Third	Amendment,	dated	as	of	February	9,	2016,	to
ABL	Credit	Agreement,	dated	as	of	June	10,	2015,	by
and	among	the	Registrant,	Tesla	Motors	Netherlands
B.V.,	certain	of	the	Registrant’s	and	Tesla	Motors
Netherlands	B.V.’s	direct	or	indirect	subsidiaries	from
time	to	time	party	thereto,	as	borrowers,	and	the
documentation	agent,	syndication	agents,
administrative	agent,	collateral	agent	and	lenders
from	time	to	time	party	thereto.
	
10-K
	
001-34756
	
10.28C
	
February	24,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.43


key: chroma:document
string_value:
10.43
	
Fourth	Amendment	to	Credit	Agreement,	dated	as	of
July	31,	2016,	by	and	among	the	Registrant,	Tesla
Motors	Netherlands	B.V.,	the	lenders	party	thereto
and	Deutsche	Bank	AG	New	York	Branch,	as
administrative	agent	and	collateral	agent.
	
8-K
	
001-34756
	
10.1
	
August	1,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.44
	
Fifth	Amendment	to	Credit	Agreement,	dated	as	of
December	15,	2016,	among	the	Registrant,	Tesla
Motors	Netherlands	B.V.,	the	lenders	party	thereto
and	Deutsche	Bank	AG,	New	York	Branch,	as
administrative	agent	and	collateral	agent.
	
8-K
	
001-34756
	
10.1
	
December	20,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.45
	
Sixth	Amendment	to	Credit	Agreement,	dated	as	of
June	19,	2017,	among	the	Registrant,	Tesla	Motors
Netherlands	B.V.,	the	lenders	party	thereto	and
Deutsche	Bank	AG,	New	York	Branch,	as
administrative	agent	and	collateral	agent
.
	
10-Q
	
001-34756
	
10.1
	
August	4,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.46
	
Seventh	Amendment	to	the	ABL	Credit	Agreement,
dated	as	of	August	11,	2017,	by	and	among	the


key: chroma:document
string_value:
Registrant,	Tesla	Motors	Netherlands	B.V.,	Deutsche
Bank	AG	New	York	Branch,	as	administrative	agent
and	collateral	agent,	and	the	other	agents	party
thereto.
	
8-K
	
001-34756
	
10.2
	
August	23,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
146


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.
47
	
	
Eighth	Amendment	to	the	ABL	Credit	Agreement,
dated	as	of	March	12,	2018,	by	and	among	the
Registrant,	Tesla	Motors	Netherlands	B.V.,	Deutsche
Bank	AG	New	York	Branch,	as	administrative	agent
and	collateral	agent,	and	the	other	agents	party
thereto.
	
10-Q
	
001-34756
	
10.2
	
May	7,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.48
	
	
Ninth	Amendment	to	the	ABL	Credit	Agreement,
dated	as	of	May	3,	2018,	by	and	among	the
Registrant,	Tesla	Motors	Netherlands	B.V.,	Deutsche
Bank	AG	New	York	Branch,	as	administrative	agent
and	collateral	agent,	and	the	other	agents	party
thereto.
	
10-Q
	
001-34756
	
10.3
	
May	7,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.49
	
Tenth	Amendment	to	the	ABL	Credit	Agreement,
dated	as	of	December	10,	2018,	by	and	among	the
Registrant,	Tesla	Motors	Netherlands	B.V.,	Deutsche
Bank	AG	New	York	Branch,	as	administrative	agent
and	collateral	agent,	and	the	other	agents	party
thereto.
	
10-K		
		
001-34756
		
10.41		
		
February	19,	2019


key: chroma:document
string_value:
10.50
	
Amendment	and	Restatement	in	respect	of	ABL	Credit
Agreement,	dated	as	of	March	6,	2019,	by	and	among
certain	of	the	Registrant’s	and	Tesla	Motors
Netherlands	B.V.’s	direct	or	indirect	subsidiaries	from
time	to	time	party	thereto,	as	borrowers,	Wells	Fargo
Bank,	National	Association,	as	documentation	agent,
JPMorgan	Chase	Bank,	N.A.,	Goldman	Sachs	Bank
USA,	Morgan	Stanley	Senior	Funding	Inc.	and	Bank
of	America,	N.A.,	as	syndication	agents,	the	lenders
from	time	to	time	party	thereto,	and	Deutsche	Bank
AG	New	York	Branch,	as	administrative	agent	and
collateral	agent.
	
S-4/A
3
33-229749
		
10.68
		
April	3,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.51
	
Eleventh	Amendment	to	Credit	Agreement,	dated	as
of	February	1,	2019,	in	respect	of	the	ABL	Credit
Agreement,	dated	as	of	June	10,	2015,	among	Tesla,
Inc.,	Tesla	Motors	Netherlands	B.V.,	the	lenders	from
time	to	time	party	thereto,	Deutsche	Bank	AG	New
York	Branch,	as	administrative	agent	and	collateral
agent	and	as	Collateral	Agent,	and	the	other	agent
parties	thereto.
	
10-Q
		
001-34756
		
10.1
		
April	29,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
147


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.52†
	
	
Agreement	for	Tax	Abatement	and	Incentives,	dated
as	of	May	7,	2015,	by	and	between	Tesla	Motors,	Inc.
and	the	State	of	Nevada,	acting	by	and	through	the
Nevada	Governor’s	Office	of	Economic	Development.
	
10-Q
	
001-34756
	
10.1
	
August	7,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.53†
	
Amended	and	Restated	Loan	and	Security	Agreement,
dated	as	of	August	17,	2017,	by	and	among	Tesla
2014	Warehouse	SPV	LLC,	Tesla	Finance	LLC,	the
Lenders	and	Group	Agents	from	time	to	time	party
thereto,	and	Deutsche	Bank	AG,	New	York	Branch,	as
Administrative	Agent.
	
10-Q
	
001-34756
	
10.3
	
November	3,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.54†
	
Amendment	No.	1	to	Amended	and	Restated	Loan	and
Security	Agreement,	dated	as	of	October	18,	2017,	by
and	among	Tesla	2014	Warehouse	SPV	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	Deutsche	Bank	AG,	New
York	Branch,	as	Administrative	Agent,	and	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent.
	
10-K


key: chroma:document
string_value:
10-K
		
001-34756
		
10.44
	
February	23,	2018
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.55
	
Amendment	No.	2	to	Amended	and	Restated	Loan	and
Security	Agreement,	dated	as	of	March	23,	2018,	by
and	among	Tesla	2014	Warehouse	SPV	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	Deutsche	Bank	AG,	New
York	Branch,	as	Administrative	Agent,	and	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent.
	
10-Q
	
001-34756
	
10.4
	
May	7,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.56
	
Amendment	No.	3	to	Amended	and	Restated	Loan	and
Security	Agreement,	dated	as	of	May	4,	2018,	by	and
among	Tesla	2014	Warehouse	SPV	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	Deutsche	Bank	AG,	New
York	Branch	as	Administrative	Agent,	and	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent.
	
10-Q
	
001-34756
	
10.1
	
November	2,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
148


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.57†
	
Amendment	No.	4	to	Amended	and	Restated	Loan	and
Security	Agreement,	dated	as	of	August	16,	2018,	by
and	among	Tesla	2014	Warehouse	SPV	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	Deutsche	Bank	AG,	New
York	Branch	as	Administrative	Agent	and	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent.
	
10-Q
	
001-34756
	
10.3
	
November	2,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.58†
	
Amendment	No.	5	to	Amended	and	Restated	Loan	and
Security	Agreement,	executed	on	December	28,	2018,
by	and	among	Tesla	2014	Warehouse	SPV	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	Deutsche	Bank	AG,	New
York	Branch	as	Administrative	Agent	and	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent.
	
10-K		
		
001-34756
		
10.48		
		
February	19,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.59††
	
Amendment	No.	6	to	Amended	and	Restated	Loan	and
Security	Agreement,	dated	as	of	August	16,	2019,	by
and	among	Tesla	2014	Warehouse	SPV	LLC,	Deutsche


key: chroma:document
string_value:
Bank	Trust	Company	Americas,	New	York	Branch,	as
Administrative	Agent,	and	the	Lenders	and	Group
Agents	from	time	to	time	party	thereto.
	
10-Q		
		
001-34756
		
10.1		
		
October	29,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.60†
	
Loan	and	Security	Agreement,	dated	as	of	August	17,
2017,	by	and	among	LML	Warehouse	SPV,	LLC,	Tesla
Finance	LLC,	the	Lenders	and	Group	Agents	from
time	to	time	party	thereto,	and	Deutsche	Bank	AG,
New	York	Branch,	as	Administrative	Agent.
	
10-Q
	
001-34756
	
10.4
	
November	3,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.61†
	
Amendment	No.	1	to	Loan	and	Security	Agreement,
dated	as	of	October	18,	2017,	by	and	among	LML
Warehouse	SPV,	LLC,	Tesla	Finance	LLC,	the	Lenders
and	Group	Agents	from	time	to	time	party	thereto,
Deutsche	Bank	AG,	New	York	Branch,	as
Administrative	Agent,	and	Deutsche	Bank	Trust
Company	Americas,	as	Paying	Agent.
	
10-K
		
001-34756
		
10.46
	
February	23,	2018
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
149


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.62
	
Amendment	No.	2	to	Loan	and	Security	Agreement,
dated	as	of	March	23,	2018,	by	and	among	LML
Warehouse	SPV,	LLC,	Tesla	Finance	LLC,	the	Lenders
and	Group	Agents	from	time	to	time	party	thereto,
Deutsche	Bank	AG,	New	York	Branch,	as
Administrative	Agent,	and	Deutsche	Bank	Trust
Company	Americas,	as	Paying	Agent.
	
10-Q
	
001-34756
	
10.5
	
May	7,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.63
	
Amendment	No.	3	to	Loan	and	Security	Agreement,
dated	as	of	May	4,	2018,	by	and	among	LML
Warehouse	SPV,	LLC,	the	Lenders	and	Group	Agents
from	time	to	time	party	thereto,	and	Deutsche	Bank
AG,	New	York	Branch,	as	Administrative	Agent.
	
10-Q
	
001-34756
	
10.2
	
November	2,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.64†
	
Amendment	No.	4	to	Loan	and	Security	Agreement,
dated	as	of	August	16,	2018,	by	and	among	LML
Warehouse	SPV,	LLC,	the	Lenders	and	Group	Agents
from	time	to	time	party	thereto,	and	Deutsche	Bank
AG,	New	York	Branch,	as	Administrative	Agent.
	
10-Q
	
001-34756
	
10.4


key: chroma:document
string_value:
001-34756
	
10.4
	
November	2,	2018
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.65†
	
Payoff	and	Termination	Letter,	executed	on	December
28,	2018,	by	and	among	LML	Warehouse	SPV,	LLC,
the	Lenders	and	Group	Agents	from	time	to	time
party	thereto,	and	Deutsche	Bank	AG,	New	York
Branch,	as	Administrative	Agent,	relating	to	Loan	and
Security	Agreement.
	
10-K		
		
001-34756
		
10.54		
		
February	19,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.66†
	
Loan	and	Security	Agreement,	executed	on	December
28,	2018,	by	and	among	LML	2018	Warehouse	SPV,
LLC,	Tesla	Finance	LLC,	the	Lenders	and	Group
Agents	from	time	to	time	party	thereto,	Deutsche
Bank	Trust	Company	Americas,	as	Paying	Agent,	and
Deutsche	Bank	AG,	New	York	Branch,	as
Administrative	Agent.
	
10-K		
		
001-34756
		
10.55		
		
February	19,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
150


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.67††
	
Letter	of	Consent,	dated	as	of	June	14,	2019,	by	and
among	LML	2018	Warehouse	SPV,	LLC,	Deutsche
Bank	AG,	New	York	Branch,	as	Administrative	Agent,
and	the	Group	Agents	party	thereto,	in	respect	of	the
Loan	and	Security	Agreement,	dated	as	of	August	17,
2017	and	as	amended	from	time	to	time,	by	and
among	LML	Warehouse	SPV,	LLC,	Tesla	Finance	LLC,
and	the	Lenders,	Group	Agents	and	Administrative
Agent	from	time	to	time	party	thereto.
	
10-Q		
		
001-34756
		
10.1		
		
July	29,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.68††
	
Amendment	No.	1	to	Loan	and	Security	Agreement,
dated	as	of	August	16,	2019,	by	and	among	LML	2018
Warehouse	SPV,	LLC,	Deutsche	Bank	Trust	Company
Americas,	as	Paying	Agent,	and	Deutsche	Bank	AG,
New	York	Branch,	as	Administrative	Agent,	and	the
Lenders	and	Group	Agents	from	time	to	time	party
thereto.
	
10-Q		
		
001-34756
		
10.2		
		
October	29,	2019		
		
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.69
	
Amendment	No.	2	to	Loan	and	Security	Agreement,


key: chroma:document
string_value:
dated	as	of	December	13,	2019,	by	and	among	LML
2018	Warehouse	SPV,	LLC,	Deutsche	Bank	Trust
Company	Americas,	as	Paying	Agent,	and	Deutsche
Bank	AG,	New	York	Branch,	as	Administrative	Agent,
and	the	Lenders	and	Group	Agents	from	time	to	time
party	thereto.
	
—
		
—
		
—
	
		
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.70
	
Purchase	Agreement,	dated	as	of	August	11,	2017,	by
and	among	the	Registrant,	SolarCity	and	Goldman
Sachs	&	Co.	LLC	and	Morgan	Stanley	&	Co.	LLC	as
representatives	of	the	several	initial	purchasers
named	therein.
	
8-K
	
001-34756
	
10.1
	
August	23,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.71
	
Amended	and	Restated	Agreement	For	Research	&
Development	Alliance	on	Triex	Module	Technology,
effective	as	of	September	2,	2014,	by	and	between
The	Research	Foundation	For	The	State	University	of
New	York,	on	behalf	of	the	College	of	Nanoscale
Science	and	Engineering	of	the	State	University	of
New	York,	and	Silevo,	Inc.
	
10-Q(1)
	
001-35758
	
10.16
	
November	6,	2014
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
151


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.72
	
First	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	October	31,
2014,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	Inc.
	
10-K(1)
	
001-35758
	
10.16a
	
February	24,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.73
	
Second	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	December
15,	2014,	by	and	between	The	Research	Foundation
For	The	State	University	of	New	York,	on	behalf	of
the	College	of	Nanoscale	Science	and	Engineering	of
the	State	University	of	New	York,	and	Silevo,	Inc.
	
10-K(1)
	
001-35758
	
10.16b
	
February	24,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.74
	
Third	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	February	12,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the


key: chroma:document
string_value:
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	Inc.
	
10-Q(1)
	
001-35758
	
10.16c
	
May	6,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.75
	
Fourth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	March	30,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	Inc.
	
10-Q(1)
	
001-35758
	
10.16d
	
May	6,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.76
	
Fifth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	June	30,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	LLC.
	
10-Q(1)
	
001-35758
	
10.16e
	
July	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
152


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.77
	
Sixth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	September
1,	2015,	by	and	between	The	Research	Foundation
For	The	State	University	of	New	York,	on	behalf	of
the	College	of	Nanoscale	Science	and	Engineering	of
the	State	University	of	New	York,	and	Silevo,	LLC.
	
10-Q(1)
	
001-35758
	
10.16f
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.78
	
Seventh	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	October	9,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	LLC
.
	
10-Q(1)
	
001-35758
	
10.16g
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.79
	
Eighth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	October	26,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the


key: chroma:document
string_value:
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	LLC.
	
10-Q(1)
	
001-35758
	
10.16h
	
October	30,	2015
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.80
	
Ninth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	December	9,
2015,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
College	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	LLC.
	
10-K(1)
	
001-35758
	
10.16i
	
February	10,	2016
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.81
	
Tenth	Amendment	to	Amended	and	Restated
Agreement	For	Research	&	Development	Alliance	on
Triex	Module	Technology,	effective	as	of	March	31,
2017,	by	and	between	The	Research	Foundation	For
The	State	University	of	New	York,	on	behalf	of	the
Colleges	of	Nanoscale	Science	and	Engineering	of	the
State	University	of	New	York,	and	Silevo,	LLC.
	
10-Q
		
001-34756
		
10.8
		
May	10,	2017
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
153


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.82††
	
Grant	Contract	for	State-Owned	Construction	Land
Use	Right,	dated	as	of	October	17,	2018,	by	and
between	Shanghai	Planning	and	Land	Resource
Administration	Bureau,	as	grantor,	and	Tesla
(Shanghai)	Co.,	Ltd.,	as	grantee	(English	translation).
	
10-Q
		
001-34756
		
10.2
		
July	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.83††
	
Facility	Agreement,	dated	as	of	September	26,	2019,
by	and	between	China	Merchants	Bank	Co.,	Ltd.
Beijing	Branch	and	Tesla	Automobile	(Beijing)	Co.,
Ltd.	(English	translation).
	
10-Q
		
001-34756
		
10.3
		
October	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.84††
	
Statement	Letter	to	China	Merchants	Bank	Co.,	Ltd.
Beijing	Branch	from	Tesla	Automobile	(Beijing)	Co.,
Ltd.,	dated	as	of	September	26,	2019	(English
translation)
.
	
10-Q
		
001-34756
		
10.4
		
October	29,	2019
	
	
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.85††
	
Fixed	Asset	Syndication	Loan	Agreement,	dated	as	of


key: chroma:document
string_value:
December	18,	2019,	by	and	among	Tesla	(Shanghai)
Co.,	Ltd.,	China	Construction	Bank	Corporation,
China	(Shanghai)	Pilot	Free	Trade	Zone	Special	Area
Branch,	Agricultural	Bank	of	China	Shanghai
Changning	Sub-branch,	Shanghai	Pudong
Development	Bank	Co.,	Ltd.,	Shanghai	Branch,	and
Industrial	and	Commercial	Bank	of	China	Limited,
China	(Shanghai)	Pilot	Free	Trade	Zone	Special	Area
Branch	(English	translation).
	
—		
		
—		
		
—		
		
—		
	
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		10.86††
	
Fixed	Asset	Syndication	Loan	Agreement	and
Supplemental	Agreement,	dated	as	of	December	18,
2019,	by	and	among	Tesla	(Shanghai)	Co.,	Ltd.,	China
Construction	Bank	Corporation,	China	(Shanghai)
Pilot	Free	Trade	Zone	Special	Area	Branch,
Agricultural	Bank	of	China	Shanghai	Changning	Sub-
branch,	Shanghai	Pudong	Development	Bank	Co.,
Ltd.,	Shanghai	Branch,	and	Industrial	and
Commercial	Bank	of	China	Limited,	China	(Shanghai)
Pilot	Free	Trade	Zone	Special	Area	Branch	(English
translation).
	
—		
		
—		
		
—		
		
—		
	
X
	
	
	
	
	
	
	
	
	
	
	
	
	
154


key: chroma:document
string_value:
Exhibit
	
	
	
Incorporated	by	Reference
	
Filed
Number
	
Exhibit	Description
	
Form
	
File	No.
	
Exhibit
	
Filing	Date
	
Herewith
		10.87††
	
Syndication	Revolving	Loan	Agreement,	dated	as	of
December	18,	2019,	by	and	among	Tesla	(Shanghai)
Co.,	Ltd.	China	Construction	Bank	Corporation,	China
(Shanghai)	Pilot	Free	Trade	Zone	Special	Area
Branch,	Agricultural	Bank	of	China	Shanghai
Changning	Sub-branch,	Shanghai	Pudong
Development	Bank	Co.,	Ltd.,	Shanghai	Branch,	and
Industrial	and	Commercial	Bank	of	China	Limited,
China	(Shanghai)	Pilot	Free	Trade	Zone	Special	Area
Branch	(English	translation).
	
—		
		
—		
		
—		
		
—		
	
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		21.1
	
List	of	Subsidiaries	of	the	Registrant
	
—
	
—
	
—
	
—
	
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		23.1
		
Consent	of	PricewaterhouseCoopers	LLP,
Independent	Registered	Public	Accounting	Firm
		
—		
		
—		
		
—		
		
—		
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		31.1
		
Rule	13a-14(a)	/	15(d)-14(a)	Certification	of	Principal
Executive	Officer
		
—		
		
—		
		
—		
		
—		
		
X


key: chroma:document
string_value:
31.2
		
Rule	13a-14(a)	/	15(d)-14(a)	Certification	of	Principal
Financial	Officer
		
—		
		
—		
		
—		
		
—		
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
		32.1*
		
Section	1350	Certifications
		
—
		
—
		
—
		
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.INS
		
Inline	XBRL	Instance	Document
		
	
—
		
	
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.SCH
		
Inline	XBRL	Taxonomy	Extension	Schema	Document
		
	
—
		
	
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.CAL
		
Inline	XBRL	Taxonomy	Extension	Calculation
Linkbase	Document.
		
	
—
		
	
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.DEF
		
Inline	XBRL	Taxonomy	Extension	Definition	Linkbase
Document
		
	
—
		
	
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.LAB
		
Inline	XBRL	Taxonomy	Extension	Label	Linkbase
Document
		
	
—
		
	
—
		
	
—
		
	
—


key: chroma:document
string_value:
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
101.PRE
		
Inline	XBRL	Taxonomy	Extension	Presentation
Linkbase	Document
		
	
—
		
	
—
		
	
—
		
	
—
		
X
	
	
	
	
	
	
	
	
	
	
	
	
	
104
		
Cover	Page	Interactive	Data	File	(formatted	as	inline
XBRL	with	applicable	taxonomy	extension	information
contained	in	Exhibits	101)
		
	
		
	
		
	
		
	
		
	
	
*
Furnished	herewith
**
Indicates	a	management	contract	or	compensatory	plan	or	arrangement
†
Confidential	treatment	has	been	requested	for	portions	of	this	exhibit
††
Portions	of	this	exhibit	have	been	redacted	in	compliance	with	Regulation	S-K	Item	601(b)(10).
(1)
Indicates	a	filing	of	SolarCity
ITEM	16.
SUMMARY
None
155


key: chroma:document
string_value:
SIGNAT
URES
Pursuant	to	the	requirements	of	Section	13	or	15(d)	the	Securities	Exchange	Act	of	1934,	the	registrant	has	duly	caused	this	report	to	be	signed
on	its	behalf	by	the	undersigned,	thereunto	duly	authorized.
	
	
	
Tesla,	Inc.
	
	
	
Date:	February	13,	2020
	
/s/	Elon	Musk
	
	
Elon	Musk
	
	
Chief	Executive	Officer
	
	
(Principal	Executive	Officer)
	
Pursuant	to	the	requirements	of	the	Securities	Exchange	Act	of	1934,	this	report	has	been	signed	below	by	the	following	persons	on	behalf	of
the	registrant	and	in	the	capacities	and	on	the	dates	indicated.
	
Signature
		
Title
	
Date
	
	
	
	
	
/s/	Elon	Musk
		
Chief	Executive	Officer	and	Director	(Principal	Executive
Officer)
	
February	13,	2020
				Elon	Musk
	
	
	
	
	
	
	
	
	
/s/	Zachary	J.	Kirkhorn
		
Chief	Financial	Officer	(Principal	Financial	Officer)
	
February	13,	2020
				Zachary	J.	Kirkhorn
	
	
	
	
	
	
	
	
	
/s/	Vaibhav	Taneja
		
Chief	Accounting	Officer	(Principal	Accounting	Officer)
	
February	13,	2020
				Vaibhav	Taneja
		
	
	
	
	
	
	
	
	
/s/	Robyn	Denholm
		
Director
	
February	13,	2020
				Robyn	Denholm
		
	
	
	
	
	
	
	
	
/s/	Ira	Ehrenpreis
		
Director
	
February	13,	2020


key: chroma:document
string_value:
Director
	
February	13,	2020
				Ira	Ehrenpreis
		
	
	
	
	
	
	
	
	
/s/	Lawrence	J.	Ellison
		
Director
	
February	13,	2020
				Lawrence	J.	Ellison
		
	
	
	
	
	
	
	
	
/s/	Antonio	J.	Gracias
		
Director
	
February	13,	2020
				Antonio	J.	Gracias
		
	
	
	
	
	
	
	
	
/s/	Stephen	T.	Jurvetson
		
Director
	
February	13,	2020
				Stephen	T.	Jurvetson
		
	
	
	
	
	
	
	
	
/s/	James	Murdoch
		
Director
	
February	13,	2020
				James	Murdoch
		
	
	
	
	
	
	
	
	
/s/	Kimbal	Musk
		
Director
	
February	13,	2020
				Kimbal	Musk
		
	
	
	
	
	
	
	
	
/s/	Kathleen	Wilson-Thompson
		
Director
	
February	13,	2020
				Kathleen	Wilson-Thompson
		
	
	
	
	
	
	
	
	
	
156
Exhibit	4.119
	
DESCRIPTION	OF	THE	REGISTRANT’S	SECURITIES	REGISTERED	PURSUANT	
TO	SECTION	12	OF	THE	SECURITIES	EXCHANGE	ACT	OF	1934
	
As	of	February	13,	2020,	Tesla,	Inc.	had	one	class	of	common	stock	registered	under	Section	12	of	the	Securities
Exchange	Act	of	1934,	as	amended	(the	“Exchange	Act”).
	
The	following	description	of	our	common	stock	is	a	summary	and	does	not	purport	to	be	complete.	It	is	subject	to


key: chroma:document
string_value:
and	qualified	in	its	entirety	by	reference	to	our	restated	certificate	of	incorporation	(the	“Certificate	of	Incorporation”)	and
our	amended	and	restated	bylaws	(the	“Bylaws”),	each	of	which	is	incorporated	herein	by	reference	as	an	exhibit	to	the
Annual	Report	on	Form	10-K	filed	with	the	Securities	and	Exchange	Commission,	of	which	this	Exhibit	4.119	is	a	part.	We
encourage	you	to	read	our	Certificate	of	Incorporation,	our	Bylaws	and	the	applicable	provisions	of	the	General
Corporation	Law	of	the	State	of	Delaware	(the	“DGCL”)	for	additional	information.
	
Authorized	Capital	Stock
	
Our	authorized	capital	stock	consists	of	2,100,000,000	shares,	with	a	par	value	of	$0.001	per	share,	of	which
2,000,000,000	shares	are	designated	as	common	stock.
	
The	holders	of	common	stock	are	entitled	to	one	vote	per	share	on	all	matters	submitted	to	a	vote	of	our
stockholders	and	do	not	have	cumulative	voting	rights.	Accordingly,	holders	of	a	majority	of	the	shares	of	common	stock
entitled	to	vote	in	any	election	of	directors	may	elect	all	of	the	directors	standing	for	election.	Subject	to	preferences	that
may	be	applicable	to	any	preferred	stock	outstanding	at	the	time,	the	holders	of	outstanding	shares	of	common	stock	are


key: chroma:document
string_value:
entitled	to	receive	ratably	any	dividends	declared	by	our	board	of	directors	out	of	assets	legally	available.	Upon	our
liquidation,	dissolution	or	winding	up,	holders	of	our	common	stock	are	entitled	to	share	ratably	in	all	assets	remaining
after	payment	of	liabilities	and	the	liquidation	preference	of	any	then	outstanding	shares	of	preferred	stock.	Holders	of
common	stock	have	no	preemptive	or	conversion	rights	or	other	subscription	rights.	There	are	no	redemption	or	sinking
fund	provisions	applicable	to	the	common	stock.
We	have	certain	outstanding	securities	that	may	be	converted,	exercised	or	exchanged	into	shares	of	our	common
stock.
	
Registration	Rights
	
Certain	holders	of	unregistered	common	stock	purchased	in	private	placements,	or	their	permitted	transferees,
are	entitled	to	rights	with	respect	to	the	registration	of	such	shares	under	the	Securities	Act	of	1933,	as	amended,	or	the
Securities	Act.	These	rights	are	provided	under	the	terms	of	an	investors’	rights	agreement	between	us	and	the	holders	of
these	shares,	or	the	investors’	rights	agreement,	and	include	demand	registration	rights,	short-form
1


key: chroma:document
string_value:
registration	rights	and	piggyback	registration	rights.	All	fees,	costs	and	expenses	of	underwritten	registrations	will	be
borne	by	us	and	all	selling	expenses,	including	underwriting	discounts	and	selling	commissions,	will	be	borne	by	the
holders	of	the	shares	being	registered.
	
The	registration	rights	terminate	with	respect	to	the	registration	rights	of	an	individual	holder	after	the	date	that
is	five	years	following	such	time	when	the	holder	can	sell	all	of	the	holder’s	shares	in	any	three	month	period	under	Rule
144	or	another	similar	exemption	under	the	Securities	Act,	unless	such	holder	holds	at	least	2%	of	our	voting	stock.
Listing
Our	common	stock	is	listed	on	the	Nasdaq	Global	Select	Market	under	the	symbol	“TSLA.”
Transfer	Agent	and	Registrar
The	transfer	agent	and	registrar	for	our	common	stock	is	Computershare	Trust	Company,	N.A.
Anti-Takeover	Effects	of	Delaware	Law	and	Our	Certificate	of	Incorporation	and	Bylaws
	
Our	amended	and	restated	certificate	of	incorporation	and	our	amended	and	restated	bylaws	contain	certain
provisions	that	could	have	the	effect	of	delaying,	deterring	or	preventing	another	party	from	acquiring	control	of	us.	These
provisions	and	certain	provisions	of	Delaware	law,	which	are	summarized	below,	are	expected	to	discourage	coercive
takeover	practices	and	inadequate	takeover	bids.	These	provisions	are	also	designed,	in	part,	to	encourage	persons	seeking
to	acquire	control	of	us	to	negotiate	first	with	our	board	of	directors.	We	believe	that	the	benefits	of	increased	protection	of
our	potential	ability	to	negotiate	more	favorable	terms	with	an	unfriendly	or	unsolicited	acquirer	outweigh	the
disadvantages	of	discouraging	a	proposal	to	acquire	us.


key: chroma:document
string_value:
Limits	on	Ability	of	Stockholders	to	Act	by	Written	Consent	or	Call	a	Special	Meeting
Our	amended	and	restated	certificate	of	incorporation	provides	that	our	stockholders	may	not	act	by	written
consent,	which	may	lengthen	the	amount	of	time	required	to	take	stockholder	actions.	As	a	result,	a	holder	controlling	a
majority	of	our	capital	stock	would	not	be	able	to	amend	our	amended	and	restated	bylaws	or	remove	directors	without
holding	a	meeting	of	our	stockholders	called	in	accordance	with	our	amended	and	restated	bylaws.
In	addition,	our	amended	and	restated	bylaws	provide	that	special	meetings	of	the	stockholders	may	be	called	only
by	the	chairperson	of	the	board,	the	chief	executive	officer,	the	president	(in	the	absence	of	a	chief	executive	officer),	or
our	board	of	directors.	Stockholders	may	not	call	a	special	meeting,	which	may	delay	the	ability	of	our	stockholders	to	force
2


key: chroma:document
string_value:
consideration	of	a	proposal	or	for	holders	controlling	a	majority	of	our	capital	stock	to	take	any	action,	including	the
removal	of	directors.
Requirements	for	Advance	Notification	of	Stockholder	Nominations	and	Proposals
Our	amended	and	restated	bylaws	establish	advance	notice	procedures	with	respect	to	stockholder	proposals	and
the	nomination	of	candidates	for	election	as	directors,	other	than	nominations	made	by	or	at	the	direction	of	our	board	of
directors	or	a	committee	of	our	board	of	directors.	These	provisions	may	have	the	effect	of	precluding	the	conduct	of
certain	business	at	a	meeting	if	the	proper	procedures	are	not	followed.	These	provisions	may	also	discourage	or	deter	a
potential	acquirer	from	conducting	a	solicitation	of	proxies	to	elect	the	acquirer’s	own	slate	of	directors	or	otherwise
attempting	to	obtain	control	of	our	company.
Board	Classification
Our	board	of	directors	is	divided	into	three	classes,	one	class	of	which	is	elected	each	year	by	our	stockholders,	and
the	directors	in	each	class	will	serve	for	a	three-year	term.	A	third	party	may	be	discouraged	from	making	a	tender	offer	or
otherwise	attempting	to	obtain	control	of	us	as	it	is	more	difficult	and	time-consuming	for	stockholders	to	replace	a
majority	of	the	directors	on	a	classified	board.
No	Cumulative	Voting
Our	amended	and	restated	certificate	of	incorporation	and	amended	and	restated	bylaws	do	not	permit	cumulative
voting	in	the	election	of	directors.	Cumulative	voting	allows	a	stockholder	to	vote	a	portion	or	all	of	its	shares	for	one	or
more	candidates	for	seats	on	the	board	of	directors.	Without	cumulative	voting,	a	minority	stockholder	may	not	be	able	to


key: chroma:document
string_value:
gain	as	many	seats	on	our	board	of	directors	as	the	stockholder	would	be	able	to	gain	if	cumulative	voting	were	permitted.
The	absence	of	cumulative	voting	makes	it	more	difficult	for	a	minority	stockholder	to	gain	a	seat	on	our	board	of	directors
to	influence	our	board’s	decision	regarding	a	takeover.
Amendment	of	Charter	Provisions
	
The	amendment	of	the	above	provisions	of	our	amended	and	restated	certificate	of	incorporation	requires
approval	by	holders	of	at	least	two-thirds	of	our	outstanding	capital	stock	entitled	to	vote	generally	in	the	election	of
directors.
Delaware	Anti-Takeover	Statute
We	are	subject	to	the	provisions	of	Section	203	of	the	Delaware	General	Corporation	Law	regulating	corporate
takeovers.	In	general,	Section	203	prohibits	a	publicly	held	Delaware	corporation	from	engaging,	under	certain
circumstances,	in	a	business	combination	with	an	interested	stockholder	for	a	period	of	three	years	following	the	date	the
person	became	an	interested	stockholder	unless:
3


key: chroma:document
string_value:
•
	
prior	to	the	date	of	the	transaction,	our	board	of	directors	approved	either	the	business	combination	or	the
transaction	which	resulted	in	the	stockholder	becoming	an	interested	stockholder;
	
	
•
	
upon	completion	of	the	transaction	that	resulted	in	the	stockholder	becoming	an	interested	stockholder,	the
interested	stockholder	owned	at	least	85%	of	the	voting	stock	of	the	corporation	outstanding	at	the	time	the
transaction	commenced,	calculated	as	provided	under	Section	203;	or
	
	
•
	
at	or	subsequent	to	the	date	of	the	transaction,	the	business	combination	is	approved	by	our	board	of	directors	and
authorized	at	an	annual	or	special	meeting	of	stockholders,	and	not	by	written	consent,	by	the	affirmative	vote	of
at	least	two-thirds	of	the	outstanding	voting	stock	which	is	not	owned	by	the	interested	stockholder.
Generally,	a	business	combination	includes	a	merger,	asset	or	stock	sale,	or	other	transaction	resulting	in	a
financial	benefit	to	the	interested	stockholder.	An	interested	stockholder	is	a	person	who,	together	with	affiliates	and
associates,	owns	or,	within	three	years	prior	to	the	determination	of	interested	stockholder	status	did	own,	15%	or	more	of
a	corporation’s	outstanding	voting	stock.	We	expect	the	existence	of	this	provision	to	have	an	anti-takeover	effect	with
respect	to	transactions	our	board	of	directors	does	not	approve	in	advance.	We	also	anticipate	that	Section	203	may	also
discourage	attempts	that	might	result	in	a	premium	over	the	market	price	for	the	shares	of	common	stock	held	by
stockholders.
The	provisions	of	Delaware	law	and	the	provisions	of	our	amended	and	restated	certificate	of	incorporation	and


key: chroma:document
string_value:
amended	and	restated	bylaws	could	have	the	effect	of	discouraging	others	from	attempting	hostile	takeovers	and,	as	a
consequence,	they	might	also	inhibit	temporary	fluctuations	in	the	market	price	of	our	common	stock	that	often	result	from
actual	or	rumored	hostile	takeover	attempts.	These	provisions	might	also	have	the	effect	of	preventing	changes	in	our
management.	It	is	possible	that	these	provisions	could	make	it	more	difficult	to	accomplish	transactions	that	stockholders
might	otherwise	deem	to	be	in	their	best	interests.
	
	
	
4
	
	
Exhibit	10.69
EXECUTION	COPY
AMENDMENT	NO.	2
TO
LOAN	AND	SECURITY	AGREEMENT
THIS	AMENDMENT	NO.	2	TO	LOAN	AND	SECURITY	AGREEMENT	(this	“
Amendment
”),	dated	as	of	December
13,	2019,	is	entered	into	by	and	among	LML	2018	WAREHOUSE	SPV,	LLC,	a	Delaware	limited	liability	company	(the
“
Borrower
”),	the	Lenders	party	hereto,	the	Group	Agents	party	hereto,	DEUTSCHE	BANK	TRUST	COMPANY	AMERICAS,	a
New	York	banking	corporation,	as	paying	agent	(the	“
Paying	Agent
”)	and	DEUTSCHE	BANK	AG,	NEW	YORK	BRANCH,	as
administrative	agent	(in	such	capacity,	the	“
Administrative	Agent
”)	and	is	made	in	respect	of	the	Loan	and	Security
Agreement,	dated	as	of	December	27,	2018	(the	“
Loan	Agreement
”)	among	the	Borrower,	Tesla	Finance	LLC,	a	Delaware
limited	liability	company	(“
TFL
”),	the	Lenders	party	thereto,	the	Group	Agents	party	thereto,	the	Administrative	Agent	and


key: chroma:document
string_value:
the	Paying	Agent.		Defined	terms	used	herein	and	not	otherwise	defined	herein	shall	have	the	respective	meanings	given	to
them	in	the	Loan	Agreement	as	amended	hereby.
WHEREAS,	the	Borrower,	the	Lenders,	the	Group	Agents,	the	Paying	Agent	and	the	Administrative	Agent	have
agreed	to	amend	the	Loan	Agreement	on	the	terms	and	conditions	set	forth	herein;
NOW,	THEREFORE,	in	consideration	of	the	premises	set	forth	above,	and	for	other	good	and	valuable
consideration,	the	receipt	and	sufficiency	of	which	are	hereby	acknowledged,	the	Borrower,	the	Lenders,	the	Group	Agents,
the	Paying	Agent	and	the	Administrative	Agent	agree	as	follows:
1.
Amendments	to	Loan	Agreement
.		Effective	as	of	the	Amendment	Effective	Date	(as	defined	below)	and
subject	to	the	satisfaction	of	the	conditions	precedent	set	forth	in	
Section	2
	hereof:
(a)
Section	1.01
	of	the	Loan	Agreement	is	hereby	amended	by	amending	the	definition	of	“Excess
Concentration	Amount”	to	read	as	follows:
“‘
Excess	Concentration	Amount
’	shall	mean,	with	respect	to	all	Warehouse	SUBI	Leases	that	are	Eligible
Leases	on	such	date,	the	sum	of,	without	duplication,	the	amounts	(if	any)	by	which:
(i)
the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	that	are	Eligible	Leases	with
Lease	Maturity	Dates	occurring	more	than	48	months	from	the	date	of	origination	of	such	Leases	exceeds	the	48+
Month	Limit;


key: chroma:document
string_value:
(ii)
if	such	date	is	on	or	after	June	30,	2020,	the	aggregate	Base	Residual	Value	of	all	Warehouse
SUBI	Leases	that	are	Eligible	Leases	scheduled	to	reach	their	Lease	Maturity	Date	in	any	one	(1)	month	exceeds
the	Single	Month	Maturity	Limit;


key: chroma:document
string_value:
(iii)
if	such	d
ate	is	on	or	after	June	30,	2020
,	
the	aggregate	Base	Residual	Value	of	all	Warehouse
SUBI	Leases	that	are	Eligible	Leases	scheduled	to	reach	their	Lease	Maturity	Date	in	any	6	consecutive	months
exceeds	the	Six	Month	Maturity	Limit;
(iv)
if	such	date	is	on	or	after	the	90
th
	day	after	the	Closing	Date,	the	amount	by	which	the
aggregate	Base	Residual	Value	of	all	Warehouse	SUBI	Leases	that	are	Eligible	Leases	exceeds	the	Base	RV	Limit;
(v)
the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	that	are	Eligible	Leases	that
cause	the	weighted	average	FICO	Score	of	all	Lessees	(or,	if	a	Lessee	is	an	entity,	the	natural	person	who	is	the
co-lessee	or	guarantor	under	the	applicable	Lease	and	an	owner	of	such	Lessee)	of	all	Warehouse	SUBI	Leases
that	are	Eligible	Leases	to	be	less	than	the	WA	FICO	Limit;	in	determining	which	Warehouse	SUBI	Lease	causes
such	weighted	average	FICO	Score	to	be	less	than	the	WA	FICO	Limit,	the	Warehouse	SUBI	Lease	or	Warehouse
SUBI	Leases	most	recently	originated	or	purchased	by	the	Trust	shall	be	treated	as	causing	such	breach;
(vi)
the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	that	are	Eligible	Leases	with
respect	to	which	the	FICO	Score	of	the	related	Lessee	(or,	if	a	Lessee	is	an	entity,	the	natural	person	who	is	the
co-lessee	or	guarantor	under	the	applicable	Lease	and	an	owner	of	such	Lessee)	of	such	Eligible	Leases	is	
600	or


key: chroma:document
string_value:
600	or
greater	but	less	than	the	Minimum	FICO	Limit	Score	exceeds	the	Minimum	FICO	Limit;
(vii)	the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	originated	in	any	state	(other	than
California)	that	are	Eligible	Leases	exceeds	the	Single	State	(Non-CA)	Limit;
(viii)
the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	originated	in	the	State	of
California	that	are	Eligible	Leases	exceeds	the	Single	State	(CA)	Limit
;
(ix)
the	aggregate	Securitization	Value	of	all	Warehouse	SUBI	Leases	that	are	Extended	Leases
exceeds	the	Extended	Lease	Limit;
(x)
the	aggregate	Securitization	Value
	of	Warehouse	SUBI	Leases	with	Lessees	with	no	FICO	score
exceeds	the	No	FICO	Score	Limit;
(xi)
the	aggregate	Securitization	Value	of	Warehouse	SUBI	Leases	with	
Lessees	with	less	than	a
600	FICO	score	exceeds	the	Sub	600	FICO	Score	Limit;	and
(xii)
the	aggregate	Securitization	Value	of	Warehouse	SUBI	Leases	that	are	Commercial	Leases
exceed	the	Commercial	Lease	Limit
.”
2.
Conditions	Precedent
.	This	Amendment	shall	become	effective	as	of	the	date	hereof	(the	“
Amendment
Effective	Date
”)	upon	satisfaction	or	waiver	of	the	following	conditions	precedent:
2


key: chroma:document
string_value:
(a)
the	receipt	by	the	Administrative	Agent	or	its	counsel	of	counterpart	signature	pages	to	this
Amendment;
(b)
no	Default,	Event	of	Default	or	Potential	Servicer	Default	shall	have	occurred	or	be	continuing,
the	Termination	Date	shall	not	have	occurred	and	no	Event	of	Bankruptcy	shall	have	occurred	with	respect	to	TFL
or	Tesla,	Inc.;	and
(c)
the	Administrative	Agent	and	each	Group	Agent	shall	have	received	such	other	documents,
instruments	and	agreements	as	the	Administrative	Agent	or	such	Group	Agent	may	have	reasonably	requested.
3.
Representations	and	Warranties	of	the	Borrower
.		The	Borrower	hereby	represents	and	warrants	to	the
Administrative	Agent,	each	Group	Agent	and	each	Lender	as	of	the	date	hereof	that:
(a)
This	Amendment	and	the	Loan	Agreement,	as	amended	hereby,	constitute	the	legal,	valid	and
binding	obligations	of	the	Borrower	and	are	enforceable	against	the	Borrower	in	accordance	with	their	respective
terms,	except	as	such	enforcement	may	be	limited	by	applicable	bankruptcy,	insolvency,	reorganization	or	other
similar	laws	relating	to	or	limiting	creditors’	rights	generally	and	by	general	principles	of	equity	(regardless	of
whether	enforcement	is	sought	in	a	proceeding	in	equity	or	at	law).
(b)
Upon	the	effectiveness	of	this	Amendment,	the	Borrower	hereby	affirms	that	all	representations
and	warranties	made	by	it	in	Article	IV	of	the	Loan	Agreement,	as	amended,	are	correct	in	all	material	respects	on
the	date	hereof	as	though	made	as	of	the	effective	date	of	this	Amendment,	unless	and	to	the	extent	that	any	such


key: chroma:document
string_value:
representation	and	warranty	is	stated	to	relate	solely	to	an	earlier	date,	in	which	case	such	representation	and
warranty	shall	have	been	true	and	correct	in	all	material	respects	as	of	such	earlier	date.
(c)
As	of	the	date	hereof,	no	Default,	Event	of	Default	or	Potential	Servicer	Default	shall	have
occurred	or	be	continuing,	the	Termination	Date	shall	not	have	occurred	and	no	Event	of	Bankruptcy	shall	have
occurred	with	respect	to	TFL	or	Tesla,	Inc.
4.
Reference	to	and	Effect	on	the	Loan	Agreement
.
(a)
Upon	the	effectiveness	of	Section	1	hereof,	each	reference	in	the	Loan	Agreement	to	“this
Agreement”,	“hereunder”,	“hereof”,	“herein”	or	words	of	like	import	shall	mean	and	be	a	reference	to	the	Loan
Agreement	as	amended	hereby.
(b)
The	Loan	Agreement,	as	amended	hereby,	and	all	other	documents,	instruments	and
agreements	executed	and/or	delivered	in	connection	therewith,	shall	remain	in	full	force	and	effect	until	hereafter
terminated	in	accordance	with	their	respective	terms,	and	the	Loan	Agreement	and	such	documents,	instruments
and	agreements	are	hereby	ratified	and	confirmed.
(c)
Except	as	expressly	provided	herein,	the	execution,	delivery	and	effectiveness	of	this
Amendment	shall	not	operate	as	a	waiver	of	any	right,	power	or	remedy	of	the	Administrative	Agent,	any	Agent	or
any	Lender,	nor	constitute	a	waiver	of
3


key: chroma:document
string_value:
any	provision	of	the	Loan	Agreement	or	any	other	documents,	instruments	and	agreements	executed	and/or
delivered	in	connection	therewith.
5.
Costs	and	Expenses
.		The	Borrower	agrees	to	pay	all	reasonable	and	actual	costs,	fees,	and	out-of-pocket
expenses	(including	the	reasonable	attorneys’	fees,	costs	and	expenses	of	Morgan,	Lewis	&	Bockius	LLP,	counsel	to	the
Administrative	Agent,	the	Group	Agents	and	the	Lenders)	incurred	by	the	Administrative	Agent,	the	Paying	Agent,	each
Group	Agent	and	each	Lender	in	connection	with	the	preparation,	review,	execution	and	enforcement	of	this	Amendment.
6.
Direction	to	Paying	Agent	to	Execute	this	Amendment
.		By	execution	of	this	Amendment,	the
Administrative	Agent	and	the	Lenders	hereby	direct	the	Paying	Agent	to	execute	this	Amendment.
7.
GOVERNING	LAW
.		THIS	AMENDMENT	SHALL	BE	GOVERNED	BY,	AND	CONSTRUED	IN
ACCORDANCE	WITH,	THE	LAWS	OF	THE	STATE	OF	NEW	YORK	WITHOUT	REFERENCE	TO	ITS	CONFLICTS	OF	LAWS
PROVISIONS	(OTHER	THAN	SECTIONS	5-1401	AND	5-1402	OF	THE	NEW	YORK	GENERAL	OBLIGATIONS	LAW).
8.
Headings
.		Section	headings	in	this	Amendment	are	included	herein	for	convenience	of	reference	only	and
shall	not	constitute	a	part	of	this	Amendment	for	any	other	purpose.
9.
Incorporation	by	Reference
.		
Section	12.13
	(
No	Petition
)	of	the	Loan	Agreement	is	hereby	incorporated	by
reference	herein,	mutatis	mutandis.		This	Section	11	shall	be	continuing	and	shall	survive	any	termination	of	the	Loan
Agreement.
10.


