Related Party Transactions
|3 Months Ended|
Mar. 31, 2021
|Related Party Transactions [Abstract]|
|Related Party Transactions||
8. Related Party Transactions
On February 28, 2018, Legacy Canoo, via a wholly owned subsidiary, entered into a lease for an office facility in Torrance, California (“Torrance lease”) with an entity controlled by certain investors of Legacy Canoo, which was assigned to another entity controlled by certain investors of Legacy Canoo, on April 30, 2018. The original lease term isand commenced on April 30, 2018. In Q1 2021, the Company entered into a separate lease for an office facility in Justin, Texas (“Justin lease”) with an entity controlled by the Executive Chaiman (as of April 22, 2021, Executive Chairman and Chief Executive Officer) of the Company. The original lease term is , commencing on January 1, 2021. The Torrance and Justin leases (“collectively referred to herein as the “leases”) contain a 3% per annum escalation clause.
The Torrance and Justin leases contain the option to extend the terms of the leases for two additionalperiods and one additional period, respectively, commencing when the prior term expires. At lease inception, it was not reasonably certain we would exercise any of the options to extend the term of the leases. There were no changes to that assessment as of March 31, 2021.
The Company has determined that the leases do not effectively transfer control of the underlying facilities to the Company based on the lease terms and, accordingly, the Company has classified the leases as operating leases. As such, the rent and property taxes are expensed on a straight-line basis in the condensed consolidated statements of operations.
Related party lease expense related to these operating leases was $0.5 million and $0.4 million for the three months ended March 31, 2021 and 2020, respectively.
The weighted average remaining lease term at March 31, 2021 and December 31, 2020 wasyears and years, respectively.
Maturities of the Company’s operating lease liabilities at March 31, 2021 were as follows (in thousands):
On November 25, 2020, Legacy Canoo entered into an agreement, which remains in effect, with Tony Aquila, Executive Chairman of Legacy Canoo (currently, Executive Chairman and Chief Executive Officer of the Company) to reimburse Mr. Aquila for certain air travel expenses based on certain agreed upon criteria (“aircraft reimbursement”). The total aircraft reimbursement to Mr. Aquila for the use of an aircraft owned by Aquila Family Ventures, LLC (“AFV”), an entity controlled by Mr. Aquila, for the purposes related to the business of the Company for the three months ended March 31, 2021 was $561,000.
The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef