Lilium N.V.(US:LILM)2022-03-30 21:27Financial Performance - Operating losses for the years ended December 31, 2020 and 2021 were €138.7 million and €400.6 million respectively, with expectations of continued losses in 2022 and beyond [394]. - Net cash used in operating activities for 2021 was €215.1 million, a significant increase from €77.9 million in 2020, primarily due to a net loss of €411.0 million [403]. - The company has substantial doubt about its ability to continue as a going concern due to recurring losses and the need for additional capital [399]. Cash and Liquidity - Cash and cash equivalents as of December 31, 2021 were €353.3 million, up from €154.9 million in 2020, with current other financial assets increasing to €219.6 million from €50.7 million [396]. - Future cash requirements are expected to necessitate additional financing through public or private equity offerings, debt financings, or partnerships [417]. - The company mitigates market risk by investing only in short-term deposits and investment-grade credit instruments, prioritizing capital preservation [687]. - Liquidity risk is reduced by investing in assets with maturities that align with the company's liquidity needs [688]. Operating Expenses and Investments - The company anticipates substantial increases in operating expenses as it advances the development and certification of the Lilium Jets and commercializes its network [410]. - The net cash used in investing activities for 2021 was €203.4 million, primarily due to investments in property, plant, and equipment, and short-term investments [406]. - The company expects to incur significant costs related to the ongoing design and development of the Lilium Jet, including completing Type Certification and building a serial production factory [415]. Compensation and Governance - Total compensation for Daniel Wiegand was €1,841,793, while total compensation for all other executives was €6,030,850 for the year ended December 31, 2021 [438]. - The company has a board of directors consisting of 9 members, with 2 female and 7 male directors [437]. - The company has a history of strong leadership with executives having extensive experience in the automotive and aerospace industries [430][429]. - Total compensation for non-executive board members amounted to €1,027,614 for the year ended December 31, 2021 [441]. Stock Options and Equity Plans - The 2021 Equity Incentive Plan was adopted to facilitate the grant of equity awards to attract and retain employees, essential for the company's long-term success [452]. - The maximum number of shares that may be delivered under the 2021 Plan is 24,880,272 shares, which can be increased by unallocated legacy options [456]. - Stock options granted under the 2021 Plan must have an exercise price of at least 100% of the fair market value on the grant date [458]. - The ESPP allows eligible employees to purchase shares at a price of 85% of the lesser of the fair market value on the grant date or the exercise date [474]. Risk Management - Credit default risk is minimized by avoiding low credit quality investments and diversifying across different counterparties [688]. - Interest rate risk is managed by investing in fixed-interest assets or holding assets until maturity [688]. - The company does not engage in speculative trading of financial assets, focusing instead on maintaining appropriate liquidity levels [687]. Employee Relations - The company employs 745 individuals and has 219 full or part-time contractors, with no work stoppages reported and a good relationship with employees [508]. - Participation in the ESPP is limited to employees with at least two years of service and who work 20 hours or more per week [472]. Board and Committee Structure - The Audit Committee is responsible for overseeing the adequacy and effectiveness of internal controls over financial reporting [504]. - The General Meeting can overrule binding nominations by a two-thirds majority of votes cast, provided it represents more than half of the issued share capital [499].