Simple, flexible rich text rendering/editing on HTML Canvas
Live demo (very self-explanatory!): http://earwicker.com/carota/
Open sourced under the very permissive MIT license - http://opensource.org/licenses/MIT
It's great to see so many people interested in Carota. I am occasionally getting asked to provide various kind of support for it, which unfortunately is not an option. So to avoid further disappointment I better state here that I am not currently available to work on it (or help you turn it into a full-blown replacement for Google Docs!)
My job is 100% full time. Carota was just a project I put together in something like a 4-day binge when I had some time off, a couple of years ago. I don't have the time to review large pull requests and figure out if they will be an improvement.
On the other hand, I have no objections to anyone basing more advanced editors on it, or copying specific whole chunks of it, or using it as a starting point for something radically different, or whatever. All at your own risk, of course. :)