Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-39291

EOS ENERGY ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)


Delaware			84-4290188
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

3920 Park Avenue	Edison	NJ	08820
(Address of Principal Executive Offices)			(Zip Code)

(732) 225-8400

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.0001 per share	EOSE	The Nasdaq Stock Market LLC
Warrants, each exercisable for one share of common stock	EOSEW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The registrant had outstanding 208,127,550 shares of common stock as of May 8, 2024.

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		Page
	PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements	4
	Unaudited Condensed Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023	4
	Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2024 and 2023	6
	Unaudited Condensed Consolidated Statements of Shareholders’ Deficit for the Three Months Ended March 31, 2024 and 2023	7
	Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023	8
	Notes to the Unaudited Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37

	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	37
Item 1a.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
Signatures		41

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FORWARD-LOOKING INFORMATION

All statements included in this Quarterly Report on Form 10-Q (“Quarterly Report”), other than statements or characterizations of historical fact, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions, as they relate to us, are intended to identify forward-looking statements. These statements appear in a number of places in this Quarterly Report and include statements regarding the intent, belief or current expectations of Eos Energy Enterprises, Inc. Forward-looking statements are based on our management’s beliefs, as well as assumptions made by and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. Factors which may cause actual results to differ materially from current expectations include, but are not limited to:

•changes adversely affecting the business in which we are engaged;

•our ability to forecast trends accurately;

•our ability to generate cash, service indebtedness and incur additional indebtedness;

•our ability to raise financing in the future;

•our customer’s ability to secure project financing;

•the amount of final tax credits available to our customers or to Eos Energy Enterprises, Inc. pursuant to the Inflation Reduction Act;

•uncertainties around our ability to meet the applicable conditions precedent and secure final approval of a loan in a timely manner or at all from the Department of Energy, Loan Programs Office, or the timing of funding and the final size of any loan that is approved;

•the possibility of a government shutdown while we work to meet the applicable conditions precedent and finalize loan documents with the U.S. Department of Energy Loan Programs Office or while we await notice of a decision regarding the issuance of a loan from the Department of Energy Loan Programs Office;

•our ability to continue to develop efficient manufacturing processes to scale and to forecast related costs and efficiencies accurately;

•fluctuations in our revenue and operating results;

•competition from existing or new competitors;

•our ability to convert firm order backlog and pipeline to revenue;

•risks associated with security breaches in our information technology systems;

•risks related to legal proceedings or claims;

•risks associated with evolving energy policies in the United States and other countries and the potential costs of regulatory compliance;

•risks associated with changes to the U.S. trade environment;

•risks resulting from the impact of global pandemics, including the novel coronavirus, Covid-19;

•our ability to maintain the listing of our shares of common stock on NASDAQ;

•our ability to grow our business and manage growth profitably, maintain relationships with customers and suppliers and retain our management and key employees;

•risks related to adverse changes in general economic conditions, including inflationary pressures and increased interest rates;

•risk from supply chain disruptions and other impacts of geopolitical conflict;

•changes in applicable laws or regulations; and

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•other factors detailed under the section entitled “Risk Factors” herein.

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements and, except as required by law, the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. See also Part I, Item 1A, “Risk Factors” disclosures contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 for additional discussion of the risks and uncertainties that could cause the Company’s actual results to differ materially from those expressed or implied in its forward-looking statements.

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Part I - Financial Information


EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)


	March 31, 2024		December 31, 2023

ASSETS
Current assets:
Cash and cash equivalents	$	31,773	$	69,473
Restricted cash	2,625		3,439
Accounts receivable, net	3,953		3,387
Inventory, net	14,393		17,070
Vendor deposits	6,513		7,161

Contract assets, current	11,075		6,386
Prepaid expenses	1,278		1,082
Grant receivable	4,798		3,256
Other receivables	7,500		7,500
Other current assets	3,110		3,577
Total current assets	87,018		122,331

Property, plant and equipment, net	42,742		37,855
Intangible assets, net	282		295
Goodwill	4,331		4,331


Operating lease right-of-use asset, net	3,735		4,033
Long-term restricted cash	11,858		11,755
Other assets, net	5,716		5,892
Total assets	$	155,682	$	186,492


LIABILITIES
Current liabilities:
Accounts payable	$	18,339	$	20,540
Accrued expenses	38,614		32,332
Operating lease liability, current	1,574		1,496
Long-term debt, current	3,458		3,332

Contract liabilities, current	2,828		3,070
Other current liabilities	108		100
Total current liabilities	64,921		60,870

Long-term liabilities:
Operating lease liability	2,922		3,350
Long-term debt	88,222		88,002
Convertible notes payable - related party	113,950		112,525
Interest payable - related party	2,892		—
Contract liabilities, long-term	4,283		3,540
Warrants liability	24,561		27,461
Other liabilities	1,604		1,544
Total long-term liabilities	238,434		236,422
Total liabilities	303,355		297,292

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EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)


	March 31, 2024		December 31, 2023

COMMITMENTS AND CONTINGENCIES (NOTE 15)

SHAREHOLDERS' DEFICIT
Common stock, $0.0001 par value, 300,000,000 shares authorized, 206,779,447 and 199,133,827 shares outstanding on March 31, 2024 and December 31, 2023, respectively	22		21
Preferred stock, $0.0001 par value, 1,000,000 shares authorized, no shares outstanding on March 31, 2024 and December 31, 2023	—		—
Additional paid in capital	774,857		765,018
Accumulated deficit	(922,554)		(875,846)
Accumulated other comprehensive income	2		7
Total shareholders' deficit	(147,673)		(110,800)
Total liabilities and shareholders' deficit	$	155,682	$	186,492

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share and per share amounts)


	Three Months Ended March 31,
	2024		2023
Revenue
Total revenue	$	6,601	$	8,835

Costs and expenses
Cost of goods sold	28,229		26,940
Research and development expenses	5,200		5,445
Selling, general and administrative expenses	14,242		13,955
Loss from write-down of property, plant and equipment	65		760

Total costs and expenses	47,736		47,100

Operating loss	(41,135)		(38,265)

Other (expense) income
Interest expense, net	(4,267)		(4,829)
Interest expense - related party	(4,851)		(13,755)
Change in fair value of warrants	2,900		(156)
Change in fair value of derivatives - related parties	534		(12,934)

Loss on debt extinguishment	—		(1,634)
Other income (expense)	136		(17)
Loss before income taxes	$	(46,683)	$	(71,590)
Income tax expense	25		10
Net loss	$	(46,708)	$	(71,600)

Other comprehensive income
Foreign currency translation adjustment, net of tax	(5)		1
Comprehensive loss	$	(46,713)	$	(71,599)

Basic and diluted loss per share attributable to common shareholders
Basic	$	(0.23)	$	(0.82)
Diluted	$	(0.23)	$	(0.82)

Weighted average shares of common stock
Basic	201,306,905		86,797,669
Diluted	201,306,905		86,797,669

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT
(In thousands, except share and per share amounts)


	Common Stock			Additional Paid in capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total
	Shares	Amount

Balances on December 31, 2022	82,653,781	$	9	$	513,614	$	6	$	(646,340)	$	(132,711)
Stock-based compensation	—	—		3,363		—		—		3,363

Release of restricted stock units	915,206	—		—		—		—		—
Cancellation of shares used to settle payroll tax withholding	(246,717)	—		(345)		—		—		(345)
Issuance of common stock	11,900,400	1		25,694		—		—		25,695

Foreign currency translation adjustment	—	—		—		1		—		1
Net loss	—	—		—		—		(71,600)		(71,600)
Balances on March 31, 2023	95,222,670	$	10	$	542,326	$	7	$	(717,940)	$	(175,597)

Balances on December 31, 2023	199,133,827	$	21	$	765,018	$	7	$	(875,846)	$	(110,800)
Stock-based compensation	—	—		2,941		—		—		2,941

Release of restricted stock units	657,605	—		—		—		—		—
Cancellation of shares used to settle payroll tax withholding	(251,967)	—		(308)		—		—		(308)
Issuance of common stock	7,239,982	1		7,206		—		—		7,207

Foreign currency translation adjustment	—	—		—		(5)		—		(5)
Net loss	—	—		—		—		(46,708)		(46,708)
Balances on March 31, 2024	206,779,447	$	22	$	774,857	$	2	$	(922,554)	$	(147,673)

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, except share and per share amounts)


	Three Months Ended March 31,
	2024		2023
Cash flows from operating activities
Net loss	$	(46,708)	$	(71,600)
Adjustment to reconcile net loss to net cash used in operating activities
Stock-based compensation	2,941		3,363
Depreciation and amortization	1,197		2,686
Loss on debt extinguishment	—		1,634
Loss from write-down of property, plant and equipment	65		760
Amortization of right-of-use assets	298		233
Non-cash interest expense	885		915
Non-cash interest expense - related party	1,549		11,338
Change in fair value of warrants	(2,900)		156
Change in fair value of derivatives - related parties	(534)		12,934



Changes in operating assets and liabilities:
Prepaid expenses	(196)		406
Inventory	2,677		9,185
Accounts receivable	(566)		(1,984)
Vendor deposits	(204)		(917)
Contract assets	(4,572)		(1,914)
Grant receivable	(1,542)		(780)
Accounts payable	(2,593)		(208)
Accrued expenses	6,159		4,991

Interest payable - related party	2,892		2,417
Operating lease liabilities	(350)		(262)
Contract liabilities	501		(3,450)

Other	527		(381)
Net cash used in operating activities	(40,474)		(30,478)

Cash flows from investing activities

Purchases of property, plant and equipment	(4,042)		(2,897)
Net cash used in investing activities	(4,042)		(2,897)

Cash flows from financing activities
Principal payments on finance lease obligations	(2)		(7)


Proceeds from issuance of convertible notes - related party	—		33,350
Payment of debt issuance costs - related party	—		(1,116)



Repayment of equipment financing facility	(786)		(677)
Proceeds from issuance of common stock	7,207		1,250


Repurchase of shares from employees for income tax withholding purposes	(308)		(345)
Net cash provided by financing activities	6,111		32,455

Effect of exchange rate changes on cash, cash equivalents and restricted cash	(6)		(1)

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EOS ENERGY ENTERPRISES, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, except share and per share amounts)


	Three Months Ended March 31,
	2024		2023
Net decrease in cash, cash equivalents and restricted cash	(38,411)		(921)
Cash, cash equivalents and restricted cash, beginning of the period	84,667		31,223
Cash, cash equivalents and restricted cash, end of the period	$	46,256	$	30,302

Non-cash investing and financing activities
Accrued and unpaid capital expenditures	$	384	$	603



Issuance of common stock upon settlement of Yorkville convertible notes	—		24,422

Accrued and unpaid capitalized internal-use software	8		130

Supplemental disclosures
Cash paid for interest	$	238	$	3,690

The accompanying notes are an integral part of these Unaudited Condensed Consolidated Financial Statements.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

1.Overview

Nature of Operations

Eos Energy Enterprises, Inc. (the “Company,” “we,” “us,” “our,” and “Eos”) designs, develops, manufactures and markets innovative energy storage solutions for utility-scale, microgrid and commercial & industrial (“C&I”) applications. Eos developed a broad range of intellectual property with multiple patents covering unique battery chemistry, mechanical product design, energy block configuration and a software operating system (Battery Management System). The Company has only one operating and reportable segment.

Liquidity and Going Concern

As a growth company in the early commercialization stage of its lifecycle, Eos is subject to inherent risks and uncertainties associated with the development of an enterprise. In this regard, substantially all of the Company’s efforts to date have been devoted to the development and manufacturing of battery energy storage systems and complimentary products and services, recruitment of management and technical staff, deployment of capital to expand the Company’s operations to meet customer demand and raising capital to fund the Company’s development. As a result of these efforts, the Company has incurred significant losses and negative cash flows from operations since its inception and expects to continue to incur such losses and negative cash flows for the foreseeable future until such time that the Company can reach a scale of profitability to sustain its operations.

In order to execute its development strategy, the Company has historically relied on outside capital through the issuance of equity, debt and borrowings under financing arrangements (collectively “outside capital”) to fund its cost structure and expects to continue to rely on outside capital for the foreseeable future. While the Company believes it will eventually reach a scale of profitability to sustain its operations, there can be no assurance the Company will be able to achieve such profitability or do so in a manner that does not require its continued reliance on outside capital. Moreover, while the Company has historically been successful in raising outside capital, there can be no assurance the Company will be able to continue to obtain outside capital in the future or do so on terms that are acceptable to the Company.

As of the date the accompanying Unaudited Condensed Consolidated Financial Statements were issued (the “issuance date”), management evaluated the significance of the following negative financial conditions in accordance with Accounting Standard Codification 205-40, Going Concern:

•Since its inception, the Company has incurred significant losses and negative cash from operations in order to fund its development. During the three months ended March 31, 2024, the Company incurred a net loss of $46,708, incurred negative cash flows from operations of $40,474 and had an accumulated deficit of $922,554 as of March 31, 2024.

•As of March 31, 2024, the Company had $31,773 of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $22,097, inclusive of $3,458 of outstanding debt that is currently scheduled to mature within the next twelve months. Additionally, the Company has no additional borrowings available under pre-existing financing arrangements to fund its operations (see Note 12, Borrowings).

•The Company has available capacity under its at-the-market (“ATM”) offering program to issue shares of the Company’s common stock, (see also Note 18, Shareholders’ Deficit) to aid in funding the Company’s operations. However, the Company’s ability to secure such funding is dependent upon certain conditions, such as investors’ willingness to purchase the Company’s common stock and at a price that is acceptable to the Company. Accordingly, as of the issuance date, there is no assurance the Company will be able to secure funding under these pre-existing arrangements or on terms that are acceptable to the Company.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

1. Overview (cont.)

•Similarly, while the Company has historically been successful in raising additional outside capital to fund the Company’s operations, as of the issuance date no assurance can be provided the Company will be successful in obtaining additional outside capital or on terms that are acceptable to the Company. In this regard, the Company continues to progress through the Department of Energy (“DOE”) Loan Programs Office’s (“LPO”) process for its Title XVII loan. In August 2023, the DOE issued a conditional commitment letter to the Company for a loan of an aggregate principal amount of up to $398,600 through the DOE’s Clean Energy Financing Program. Certain technical, legal and financial conditions must be met and due diligence to the satisfaction of the DOE must be completed before the DOE enters into definitive financing documents with the Company and funds the loan. There can be no assurance that the Company will be able to secure such a loan or on terms that are acceptable to the Company.

•The Company is required to remain in compliance with a quarterly minimum financial liquidity covenant under its Senior Secured Term Loan Credit Agreement (“Senior Secured Term Loan”). While the Company was in compliance with this covenant as of March 31, 2024, the Company expects it may be unable to remain in compliance with this covenant beginning on June 30, 2024 and thereafter absent the Company’s ability to secure a waiver or raise additional outside capital. In the event the Company is unable to remain in compliance with the minimum financial liquidity covenant and the other nonfinancial covenants required by the Senior Secured Term Loan and the Company is further unable to cure such noncompliance or secure a waiver, the Lender - Atlas Credit Partners (ACP) Post Oak Credit I LLC (“Atlas”) may, at its discretion, exercise any and all of its existing rights and remedies, which may include, among other things, entering into a forbearance agreement with the Company and/or asserting its rights in the Company’s assets securing the loan. Moreover, the Company’s other lenders may exercise similar rights and remedies under the cross-default provisions of their respective borrowing arrangements with the Company.

•Absent an ability to secure additional outside capital in the near term, the Company will be unable to meet its obligations as they become due over the next twelve months beyond the issuance date.

•In the event the Company’s ongoing efforts to raise additional outside capital prove unsuccessful, management will be required to seek other strategic alternatives, which may include, among others, a significant curtailment in the Company’s operations, a sale of certain of the Company’s assets, a sale of the entire Company to strategic or financial investors and/or allowing the Company to become insolvent.

These uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates that the Company will be able to realize assets and settle liabilities and commitments in the normal course of business for the foreseeable future. Accordingly, the accompanying Unaudited Condensed Consolidated Financial Statements do not include any adjustments that may result from the outcome of these uncertainties.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its 100% owned, direct and indirect subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). All intercompany transactions and balances have been eliminated in the preparation of the Unaudited Condensed Consolidated Financial Statements. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The interim financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in our 2023 Annual Report on Form 10-K. These interim results are not necessarily indicative of results for the full year.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

2. Summary of Significant Accounting Policies (cont.)

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 and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification of Prior Year Presentation

Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.

Recent Accounting Pronouncements

There were no new accounting standards or updates during the three months ended March 31, 2024 that would have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.

3. Revenue Recognition

The Company primarily earns revenue from sales of its energy storage systems and services including installation, commissioning and extended warranty services. Product revenues, which are generally recognized at a point in time, and service revenues, which are generally recognized over time, are as follows:


	For the Three Months Ended March 31,
	2024		2023
Product revenue	$	6,501	$	8,675
Service revenue	100		160
Total revenues	$	6,601	$	8,835

For the three months ended March 31, 2024, the Company had one customer that accounted for 88.1% of total revenue; for the three months ended March 31, 2023, we had one customer that accounted for 97.0% of total revenue.

Lessor revenue

The Company leases battery energy storage systems to one customer through a sales-type lease with a 20-year term. No revenue was recognized from the sales-type lease for the three months ended March 31, 2024 and 2023.

Contract assets and Contract liabilities

The following table provides information about contract assets and contract liabilities from contracts with customers. Contract assets, current, Contract liabilities, current and Contract liabilities, long-term are included separately on the Unaudited Condensed Consolidated Balance Sheets and contract assets expected to be recognized in greater than twelve months are included under Other assets, net.


	March 31, 2024		December 31, 2023
Contract assets	$	12,894	$	8,322
Contract liabilities	$	7,111	$	6,610

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

3. Revenue Recognition (cont.)

The Company recognizes contract assets for certain contracts in which revenue recognition performance obligations have been satisfied but invoicing to the customer has not yet occurred. Contract liabilities primarily relate to consideration received from customers in advance of the Company’s satisfying performance obligations under contractual arrangements. Contract balances are reported in a net contract asset or liability position on a contract-by-contract basis at the end of each reporting period.

Contract assets increased by $4,572 during the three months ended March 31, 2024 due to recognition of revenues for which invoicing has not yet occurred. Contract liabilities increased by $501 during the three months ended March 31, 2024, reflecting $798 of revenue recognized from customers and offset by $1,299 in customer advance payments.

Contract liabilities of $2,828 as of March 31, 2024 are expected to be recognized within the next twelve months and long-term contract liabilities of $4,283 are expected to be recognized as revenue in greater than twelve months. Contract assets of $11,075 as of March 31, 2024 are expected to be recognized within the next twelve months and long-term contract assets of $1,819 are expected to be recognized as accounts receivable in greater than twelve months.

Remaining Performance Obligations

Remaining performance obligations (“RPO”) represent the allocated transaction price of unsatisfied or partially unsatisfied performance obligations. The Company expects to recognize revenue related to the RPOs as the performance obligations are satisfied in accordance with the Company’s revenue recognition policy, which can be found in Note 2, Summary of Significant Accounting Policies, of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

4. Cash, Cash Equivalents and Restricted Cash

Restricted cash - current consists of escrow deposits related to U.S. Custom Bonds insurance and escrow deposits related to our credit card program agreements.

Long-term restricted cash relates to interest that is required to be held in escrow per the Senior Secured Term Loan Agreement in an amount equal to the next four quarterly interest payments owed as of the balance sheet date (see Note 12, Borrowings for further discussion).

The following table reconciles reported amounts from the Unaudited Condensed Consolidated Balance Sheets to Cash, Cash Equivalents and Restricted Cash reported within the Unaudited Condensed Consolidated Statements of Cash Flows:


	March 31, 2024		March 31, 2023
Cash and cash equivalents	$	31,773	$	16,127
Restricted cash - current	2,625		2,725
Long-term restricted cash	11,858		11,450
Total cash, cash equivalents and restricted cash	$	46,256	$	30,302

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

5. Inventory

The following table provides information about inventory balances:


	March 31, 2024		December 31, 2023
Raw materials	$	13,045	$	15,487
Work-in-process	490		1,105
Finished goods	858		478
Total inventory, net	$	14,393	$	17,070

6. Property, Plant and Equipment, Net

The following table provides information about property, plant and equipment, net balances:


	Estimated Useful lives	March 31, 2024		December 31, 2023
Equipment	5 to 10 years	$	22,484	$	20,559
Finance lease	5 years	504		504
Furniture	5 to 10 years	2,179		2,103
Leasehold improvements	Lesser of useful life/ remaining lease	7,951		7,718
Tooling	2 to 3 years	7,866		7,045
Construction in progress (“CIP”)		20,819		17,958
Total		61,803		55,887
Less: Accumulated depreciation		(19,061)		(18,032)
Total property, plant and equipment, net		$	42,742	$	37,855

Depreciation expense related to property, plant and equipment was $1,175 and $2,667 for the three months ended March 31, 2024 and 2023, respectively. For the three months ended March 31, 2024 and 2023, the Company recorded a loss from write-down of property, plant and equipment of $65 and $760, respectively, mainly due to replacement of equipment, outsourcing of certain production processes and the shift in production from the Gen 2.3 battery system to the Z3™ battery system.

Included in CIP assets are capitalized interest costs of $850 and $0 for the three months ended March 31, 2024 and 2023, respectively. Depreciation will commence after the assets under construction are placed in service.

7. Intangible Assets

Intangible assets include patents valued at $400, which represents the cost to acquire the patents. These patents are determined to have useful lives and are amortized into the results of operations over ten years. The Company recorded amortization expense of $10 for the three months ended March 31, 2024 and 2023 related to patents.

The Company capitalized $146 of costs for internal-use software, including $8 of costs capitalized during the three months ended March 31, 2024. The software has a useful life and is amortized into the results of operations over 3 years. The Company recorded amortization expense of $12 and $9 for the three months ended March 31, 2024 and 2023, respectively, related to software.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

8. Notes Receivable, Net and Variable Interest Entities (“VIEs”) Consideration

Notes receivable, net, relates to financing the Company offered to a customer. The Company reports the notes receivable at the principal balance outstanding less an allowance for losses. The estimate of credit losses is based on historical trends, the customer’s financial condition and current economic trends. The Company charges interest at a fixed rate and calculates interest income by applying the effective rate to the outstanding principal balance.

The Company had notes receivable, net, of $827 and $863 outstanding as of March 31, 2024 and December 31, 2023, respectively. These amounts are included in Other assets, net and Other current assets in the accompanying Unaudited Condensed Consolidated Balance Sheets. As of March 31, 2024 and December 31, 2023, the allowance for expected credit loss related to the notes receivable amounted to $36 and $2, respectively.

The customer to whom the Company offers financing through notes receivable is a VIE. However, the Company is not the primary beneficiary, because the Company does not have power to direct the activities of the VIE that most significantly impact the VIE’s economic performance. Therefore, the VIE is not consolidated into the Company’s consolidated financial statements. The maximum loss exposure is limited to the carrying value of notes receivable as of the balances sheet dates.

9. Accrued Expenses

Accrued expenses were as follows:


	March 31, 2024		December 31, 2023
Accrued payroll	$	7,273	$	4,553
Warranty reserve (1)	5,513		6,197
Accrued legal and professional expenses	11,058		10,710
Provision for contract losses	3,205		3,351
Insurance premium payable, current	2,730		2,605
Interest payable, current	3,684		—
Other	5,151		4,916
Total accrued expenses	$	38,614	$	32,332

(1) Refer to the table below for the warranty reserve activity for the three months ended March 31, 2024 and 2023.

The following table summarizes warranty reserve activity:


	Three Months Ended March 31,
	2024		2023
Warranty reserve - beginning of period	$	6,197	$	3,836
Additions for current period deliveries	265		357
Changes in the warranty reserve estimate	(949)		—
Warranty costs incurred	—		(221)
Warranty reserve - end of period	$	5,513	$	3,972

10. Government Grants

Inflation Reduction Act of 2022 (“IRA”)

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

10. Government Grants (cont.)

On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 into law. The IRA has significant economic incentives for both energy storage customers and manufacturers for projects placed in service after December 31, 2022. Starting in 2023, there are Production Tax Credits under Internal Revenue Code 45X (“PTC”), that can be claimed on battery components manufactured in the U.S. and sold to U.S. or foreign customers. The tax credits available to manufacturers include a credit for ten percent of the cost incurred to make electrode active materials in addition to credits of $35 per kWh of capacity of battery cells and $10 per kWh of capacity of battery modules. These credits are cumulative, meaning that companies will be able to claim each of the available tax credits based on the battery components produced and sold through 2029, after which the PTC will begin to gradually phase down through 2032. In June 2023, the IRS issued temporary and proposed regulations related to applicable tax credit transferability and direct pay provisions of the Inflation Reduction Act. The Company has reviewed these regulations and believes they do not have a material impact on the financial statements.

Since the PTC is a refundable credit (i.e., a credit with a direct-pay option available), the PTC is outside the scope of ASC 740. Therefore, the Company accounts for the PTC under a government grant model. GAAP does not address the accounting for government grants received by a business entity that are outside the scope of ASC 740. The Company’s accounting policy is to analogize to IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, under IFRS Accounting Standards. Under IAS 20, once it is reasonably assured that the entity will comply with the conditions of the grant, the grant money is recognized on a systematic basis over the periods in which the entity recognizes the related expenses or losses for which the grant money is intended to compensate. The Company recognizes grants once it is probable that both of the following conditions will be met: (1) the Company is eligible to receive the grant and (2) the Company is able to comply with the relevant conditions of the grant.

The PTC is recorded as the applicable items are produced and sold and the conditions in the preceding paragraph are met. For the three months ended March 31, 2024 and 2023, the Company recognized PTC of $1,542 and $798, respectively, as a reduction of cost of goods sold on the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Loss. As of March 31, 2024 and December 31, 2023, grant receivable related to the PTC in the amount of $4,798 and $3,256, respectively, is recorded in the Unaudited Condensed Consolidated Balance Sheets.

11. Related Party Transactions

2021 Convertible Note Payable

In July 2021, the Company issued a convertible note in the aggregate principal amount of $100,000 to Spring Creek Capital, LLC, a wholly-owned, indirect subsidiary of Koch Industries, Inc. (the “2021 Convertible Note”). In connection with the 2021 Convertible Note, the Company paid $3,000 to B. Riley Securities, Inc., a related party, who acted as a placement agent. Refer to Note 12, Borrowings, for additional information.

AFG Convertible Notes

In January 2023, the Company issued and sold $13,750 of 26.5% Convertible Senior PIK Notes due in 2026 (“AFG Convertible Notes”) to Great American Insurance Company, Ardsley Partners Renewable Energy, LP, CCI SPV III, LP, Denman Street LLC, John B. Bending Irrevocable Children’s Trust, John B. Berding and AE Convert, LLC, a Delaware limited liability company managed by Russell Stidolph, a director of the Company (together, the “Purchasers”). In connection with the issuance and sale of the AFG Convertible Notes, the Company entered into an investment agreement (the “Investment Agreement”) with the Purchasers. Refer to Note 12, Borrowings, for additional information.

Standby Equity Purchase Agreement

On April 28, 2022, the Company entered into the Standby Equity Purchase Agreement (“SEPA”). Pursuant to the SEPA, the Company had the right, but not the obligation, to sell to Yorkville shares of its common stock at the Company’s request. On August 23, 2023, the Company and Yorkville terminated the SEPA, as amended, by mutual written consent. See Note 12, Borrowings for pre-advance loans in form of convertible promissory notes and Note 18, Shareholders' Deficit for additional information.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

11. Related Party Transactions (cont.)

Warrants

The Company issued private placement warrants to B. Riley Financial, Inc. in conjunction with its initial public offering 2020 (“IPO warrants”). As of March 31, 2024 and December 31, 2023, 274,400 IPO warrants were outstanding for both periods, with a fair value of $49 and $55, respectively.

12. Borrowings

The Company’s debt obligations at carrying value consist of the following related and third-party borrowings:


		March 31, 2024				December 31, 2023
	Maturity Date	Borrowing Outstanding		Carrying Value*		Borrowing Outstanding		Carrying Value*
2021 Convertible Note Payable	June 2026	$	115,815	$	96,033	$	115,815	$	94,386
Senior Secured Term Loan	March 2026	100,000		86,756		100,000		85,624
AFG Convertible Notes	June 2026	17,429		17,917		17,429		18,139
Equipment financing facility	April 2026	4,931		4,924		5,718		5,710
Total borrowings		238,175		205,630		238,962		203,859
Current portion		3,458		3,458		3,332		3,332
Total borrowings, non-current		$	234,717	$	202,172	$	235,630	$	200,527

*Carrying value includes unamortized deferred financing costs, unamortized discounts and fair value of embedded derivative liabilities.

2021 Convertible Note Payable – Related Party

On July 6, 2021, the Company entered into an investment agreement with Spring Creek Capital, LLC, a wholly-owned, indirect subsidiary of Koch Industries, Inc. The investment agreement provides for the issuance and sale to Koch Industries of the 2021 Convertible Note in the aggregate principal amount of $100,000.

The 2021 Convertible Note contains an embedded derivative feature, which is presented on the Unaudited Condensed Consolidated Balance Sheets as a component of Convertible notes payable - related party. See Note 14, Fair Value Measurement for the assumptions used to determine the fair value of the embedded derivative as of March 31, 2024 and December 31, 2023.

Interest expense recognized on the 2021 Convertible Note is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,737	$	1,637
Amortization of debt discount	1,531		1,207
Amortization of debt issuance costs	148		117
Total	$	3,416	$	2,961

The balances for the 2021 Convertible Note are as follows:


	March 31, 2024		December 31, 2023
Principal	$	115,815	$	115,815
Unamortized debt discount	(18,081)		(19,612)
Unamortized debt issuance costs	(1,747)		(1,895)
Embedded conversion feature	46		78
Aggregate carrying value	$	96,033	$	94,386

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

12. Borrowings (cont.)

The Company is obligated to repay all contractual interest attributable to the 2021 Convertible Note in-kind on a semi-annual basis, in accordance with the terms under the Senior Secured Term Loan. Therefore, as of March 31, 2024 and December 31, 2023, interest payable attributable to the 2021 Convertible Note was $1,737 and $0, respectively.

AFG Convertible Notes - Related Party

On January 18, 2023, the Company entered into the Investment Agreement with the Purchasers relating to the issuance and sale to the Purchasers of $13,750 in aggregate principal amount of the Company’s AFG Convertible Notes. The AFG Convertible Notes bear interest at a rate of 26.5% per annum, which is entirely paid-in-kind (“PIK Interest”) semi-annually in arrears on June 30 and December 30. It is expected that the Notes will mature on June 30, 2026, subject to earlier conversion, redemption or repurchase. The AFG Convertible Notes are convertible into shares of the Company’s common stock, par value $0.0001 per share, based on an initial conversion price of approximately $1.67 per share subject to customary anti-dilution and other adjustments. The Company has the right to settle conversions in shares of common stock, cash, or any combination thereof.

The Conversion Option includes an exercise contingency, which requires the Company to obtain shareholder approval for conversions subject to the Exchange Cap. If shareholder approval is not obtained, following commercially reasonable efforts, the Company will be required to settle the conversion in excess of the Exchange Cap in cash. Since settlement in cash may be required in absence of shareholder approval, the embedded conversion feature fails the equity classification guidance in ASC 815 and is thus precluded from being classified in equity. Therefore, the embedded conversion feature is required to be bifurcated from the AFG Convertible Notes and accounted for at fair value at each reporting date, with changes in fair value recognized on the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The embedded derivative is presented on the Unaudited Condensed Consolidated Balance Sheets as a component of Convertible notes payable - related party. The fair value of the embedded derivative was $3,843 and $4,345 as of March 31, 2024 and December 31, 2023, respectively.

The fair value of the AFG Convertible Notes at issuance was $16,623, which was greater than the proceeds received. The Company recorded the difference of $2,873 as interest expense for the three months ended March 31, 2023 on the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Loss.

Interest expense recognized on the AFG Convertible Notes is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,155	$	779
Amortization of debt discount	218		148
Amortization of debt issuance costs	62		42
Total	$	1,435	$	969

The balances for the AFG Convertible Notes are as follows:


	March 31, 2024		December 31, 2023
Principal	$	17,429	$	17,429
Unamortized debt discount	(2,617)		(2,835)
Unamortized debt issuance costs	(738)		(800)
Embedded conversion feature	3,843		4,345
Aggregate carrying value	$	17,917	$	18,139

Table of Contents


EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

12. Borrowings (cont.)

The Company is obligated to repay all contractual interest attributable to the AFG Convertible Notes in-kind on a semi-annual basis, in accordance with the terms of the Investment Agreement. Therefore, as of March 31, 2024 and December 31, 2023, interest payable attributable to the AFG Convertible Notes was $1,155 and $0, respectively.

Senior Secured Term Loan

On July 29, 2022, the Company entered into a $100,000 Senior Secured Term Loan Credit Agreement with Atlas Credit Partners (ACP) Post Oak Credit I LLC, as administrative agent for the lenders and collateral agent for the secured parties. The Senior Secured Term Loan is scheduled to mature on the earlier of (i) July 29, 2026 and (ii) 91 days prior to the current maturity date of the 2021 Convertible Note of June 30, 2026. The Company has the right at any time to prepay any Borrowing in whole or in part in an amount of not less than $500.

The outstanding principal balance of the Senior Secured Term Loan bears interest, at the applicable margin plus, at the Company’s election, either (i) the benchmark secured overnight financing rate (“SOFR”), which is a per annum rate equal to (y) the Adjusted Term SOFR plus 0.2616%, or (ii) the alternate base rate (“ABR”), which is a per annum rate equal to the greatest of (x) the Prime Lending Rate, (y) the NYFRB Rate (as defined in the agreement) plus 0.5% and (z) the SOFR. The applicable margin under the Credit Agreement is 8.5% per annum with respect to SOFR loans and 7.5% per annum with respect to ABR loans. Interest on the Senior Secured Term Loan accrues at a variable interest rate and interest payments are due quarterly. The Company may elect to convert SOFR Loans to ABR and ABR Loans to SOFR. As of March 31, 2024, the interest rate in effect for the Senior Secured Term Loan interest payment was 14.11%.

Any repayment of principal prior to the second anniversary of the issuance date is subject to a call premium. The call premium is equal to the present value of all interest payments due through June 30, 2024, calculated using a discount rate equal to the applicable treasury rate as of the repayment date plus 50 basis points. The Company deemed that the fair value of the embedded derivative features which qualify for bifurcation was de minimis.

Additionally, interest is required to be escrowed based on the principle outstanding. This amount was $11,858 at March 31, 2024 and $11,755 at December 31, 2023. This escrowed and restricted cash is presented on a separate line item on the Unaudited Condensed Consolidated Balance Sheets as Long-term restricted cash.

The agreements also contain customary affirmative and negative covenants. They limit the Company’s and its subsidiaries’ ability to incur indebtedness, make restricted payments, including cash dividends on its common stock, make certain investments, loans and advances, enter into mergers and acquisitions, sell, assign, transfer or otherwise dispose of its assets, enter into transactions with its affiliates and engage in sale and leaseback transactions, among other restrictions. Furthermore, the limitation on the Company’s ability to incur indebtedness also requires payment of principal and interest in kind on the 2021 Convertible Note. While the Company was in compliance with this covenant as of March 31, 2024 , absent the Company’s ability to secure a waiver or raise additional outside capital, the Company expects it may be unable to remain in compliance with this covenant beginning on June 30, 2024 and thereafter (see Note 1, Overview for further discussion).

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

12. Borrowings (cont.)

The following table summarizes interest expense recognized:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	3,684	$	3,373
Amortization of debt discount	115		93
Amortization of debt issuance costs	1,017		822
Total	$	4,816	$	4,288

The Senior Secured Term Loan balance is as follows:


	March 31, 2024		December 31, 2023
Principal	$	100,000	$	100,000
Unamortized debt discount	(1,344)		(1,459)
Unamortized debt issuance costs	(11,900)		(12,917)
Aggregate carrying value	$	86,756	$	85,624

Equipment Financing facility

The Company entered into an agreement on September 30, 2021 with Trinity Capital Inc. (“Trinity”) for a $25,000 equipment financing facility, the proceeds of which will be used to acquire certain manufacturing equipment, subject to Trinity’s approval. Each draw is executed under a separate payment schedule (a “Schedule”) that constitutes a separate financial instrument. The financing fees included in each Schedule are established through monthly payment factors determined by Trinity. Such monthly payment factors are based on the Prime Rate reported in The Wall Street Journal in effect on the first day of the month in which a Schedule is executed. The Company has drawn a portion of the facility as follows:


Date of Draw	Gross Amount of Initial Draw		Coupon Interest Rate	Debt Issuance Costs
September 2021	$	7,000	14.3%	$	175
September 2022	4,216		16.2%	96
Total Equipment Financing loans	$	11,216		$	271

As of March 31, 2024 and December 31, 2023, total equipment financing carrying value was $4,924 and $5,710, respectively of which $3,458 and $3,332 are recorded as a current liability on the Unaudited Condensed Consolidated Balance Sheets, respectively. The Company recognized $208 and $317 for the three months ended March 31, 2024 and 2023 as interest expense attributable to the equipment financing agreement, respectively.

Yorkville Convertible Promissory Notes - Related Party

In December 2022, February 2023, and March of 2023, the Company issued additional convertible promissory notes with an aggregate principal amount of $22,000 in a private placement to Yorkville under the second and third supplemental agreements to the SEPA, respectively. The fair values of the January 2023 and February 2023 Promissory Notes at issuance were greater than the proceeds received. Accordingly, the Company recorded the excess of fair value of these Promissory Notes over the proceeds received as Interest expense - related party in the amount of $6,952, for the three months ended March 31, 2023, which is reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

12. Borrowings (cont.)

During the first quarter of 2023, Yorkville delivered Investor Notices requiring the Company to issue and sell an aggregate of 11,216,492 shares of common stock to Yorkville to offset all outstanding amounts owed to Yorkville under the outstanding Promissory Notes. The Company recognized a loss on debt extinguishment from the issuance of common stock from the December 2022, January 2023, and February 2023 Promissory Notes of $1,634 for the three months ended March 31, 2023, which is reflected in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

The conversion feature for each of the Promissory Notes discussed above did not qualify for the scope exception to derivative accounting, therefore bifurcation was required for each issuance. Upon extinguishment of each Promissory Note, the embedded derivatives were adjusted to their fair value. This remeasurement resulted in net gains of $55 for the three months ended March 31, 2023, which is included in change in fair value of derivatives - related parties on the Condensed Consolidated Statements of Operations and Comprehensive Loss.

As of December 31, 2023, there were no outstanding amounts under the Yorkville Promissory Notes.

13. Warrants Liability

In April 2023, the Company issued 16,000,000 shares of common stock and 16,000,000 private placement warrants to purchase shares of common stock. In May 2023, the Company issued another 3,601,980 shares of common stock and 3,601,980 private placement warrants to purchase shares of common stock (the “April 2023 warrants” and “May 2023 warrants”, respectively).

In December 2023, the Company issued in a combined public offering 34,482,759 shares of common stock and 34,482,759 accompanying common warrants to purchase shares of common stock (the "December 2023 warrants").

The amount of warrants outstanding and fair value for all warrants as of March 31, 2024 and December 31, 2023 are as follows:


	March 31, 2024			December 31, 2023
	Warrants Outstanding	Fair Value		Warrants Outstanding	Fair Value
IPO warrants	274,400	$	49	274,400	$	55
April 2023 warrants	16,000,000	5,494		16,000,000	6,276
May 2023 warrants	3,601,980	1,357		3,601,980	1,544
December 2023 warrants	34,482,759	17,661		34,482,759	19,586
Total	54,359,139	$	24,561	54,359,139	$	27,461

All warrants are measured at fair value at each reporting period. For all warrants in aggregate, the change in fair value for the three months ended March 31, 2024 and 2023 has been recognized in change in fair value of warrants on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss. The fair value for the warrants is included in Warrants liability on the Condensed Consolidated Balance Sheets. See Note 14, Fair Value Measurements for further information.

14. Fair Value Measurement

The Company’s financial instruments consist of cash and cash equivalents, restricted cash, accounts receivable, notes receivable, contract assets, accounts payable, warrants, convertible notes payable — related party, contract liabilities and long-term debt.

Accounting standards establish a hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three levels. The fair value hierarchy gives the highest priority to quoted market prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

14. Fair Value Measurement (cont.)

Accounting standards require financial assets and liabilities to be classified based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and the exercise of this judgment may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels.

The carrying value of cash and cash equivalents, restricted cash, accounts receivable, contract assets, contract liabilities and accounts payable are considered to be representative of their fair value due to the short maturity of these instruments.

The table below summarizes the fair values of certain liabilities that are included within the Company’s accompanying Unaudited Condensed Consolidated Balance Sheets and their designations among the three fair value measurement categories:


	March 31, 2024						December 31, 2023
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Liabilities
Warrants	$	—	$	49	$	24,512	$	—	$	55	$	27,406
Embedded derivatives	$	—	$	—	$	3,889	$	—	$	—	$	4,423

Warrants Liabilities

The IPO warrants are classified as Level 2 financial instruments in the table above. They are valued on the basis of the quoted price of the Company’s public warrants, adjusted for insignificant difference between the public warrants and the private placement warrants.

The April 2023 warrants, May 2023 warrants and December 2023 warrants are classified as Level 3 financial instruments in the table above. The Company estimated the fair value of these warrants using the Black-Scholes model at inception and on subsequent valuation dates. This model incorporates inputs such as the stock price of the Company, risk-free interest rate, volatility and time to expiration. The volatility involves unobservable inputs classified as Level 3 of the fair value hierarchy.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

14. Fair Value Measurement (cont.)

The inputs used to determine the fair value of the April 2023 warrants, May 2023 warrants and the December 2023 warrants are as follows:


April 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.54 years			4.79 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

May 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.29 years			4.54 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

December 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.71 years			4.96 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

Embedded derivatives

The Company estimated the fair value of the embedded conversion features in the 2021 Convertible Note and the AFG Convertible Notes using a binomial lattice model at inception and on subsequent valuation dates. This model incorporates inputs such as the stock price of the Company, dividend yield, risk-free interest rate, the effective debt yield and expected volatility. The effective debt yield and volatility involve unobservable inputs classified as Level 3 of the fair value hierarchy.

The inputs used to determine the fair value of the embedded derivative liabilities are as follows:


2021 Convertible Note Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

AFG Convertible Notes Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

Table of Contents


EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

14. Fair Value Measurement (cont.)

Level 3 Liabilities

Level 3 liabilities are measured at fair value on a recurring basis using significant unobservable inputs. The following table summarizes the changes in the fair value of liabilities that are included within the Company’s accompanying Unaudited Condensed Consolidated Balance Sheets and are designated as Level 3:


	Three Months Ended March 31,
	2024		2023
Embedded derivatives
Balance at beginning of the period	$	4,423	$	1,945
Additions	—		14,799

Change in fair value of derivatives - related parties1	(534)		4,511
Balance at end of the period	$	3,889	$	21,255

Warrants
Balance at beginning of the period	$	27,406	$	—
Additions	—		—
Change in fair value of warrants	(2,894)		—
Balance at end of the period	$	24,512	$	—

1 Includes loss on debt extinguishment from Yorkville Promissory Note Conversions for the three months ended March 31, 2023.

The estimated fair value of financial instruments not carried at fair value in the Unaudited Condensed Consolidated Balance Sheets was as follows:


	Level in Fair Value Hierarchy	March 31, 2024				December 31, 2023
		Carrying Value		Fair Value		Carrying Value		Fair Value
Notes receivable	3	$	827	$	721	$	863	$	719
2021 Convertible Note*	3	96,033		63,034		94,386		57,998
Senior Secured Term Loan	3	86,756		64,117		85,624		61,360
AFG Convertible Notes*	3	17,917		19,076		18,139		18,352
Equipment financing facility	3	4,924		4,261		5,710		4,826
Total		$	206,457	$	151,209	$	204,722	$	143,255

*Includes the embedded derivative liabilities.

15. Commitments and Contingencies

Lease Commitments

The Company has lease commitments under lease agreements. As of March 31, 2024, future lease payments amounted to $5,568.

Minimum Volume Commitment

In June 2022, the Company entered into a long-term supply agreement with a minimum volume commitment with a third party that provides services to process certain raw materials. Any purchase order issued under this supply agreement will be non-cancellable. If the Company fails to order the guaranteed minimum volume defined in the contract at the end of the term, the Company will be required to pay the counterparty an amount equal to the shortfall, if any, multiplied by a fee. The Company believes it will meet the minimum volume commitment and no shortfall penalty has been accrued as of March 31, 2024.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

15. Commitments and Contingencies (cont.)

Legal Proceedings

Class Action Complaints

On March 8, 2023, a class action lawsuit was filed in the Court of Chancery of the State of Delaware by plaintiff Richard Delman against certain defendants including the Company’s former directors (the “Delman Defendants”). Neither the Company nor Eos Energy Storage LLC were named as a defendant but each was identified in the Complaint as a relevant non-party and the Company has indemnification obligations relating to the lawsuit. On February 1, 2024, the parties agreed to a binding Settlement Term Sheet (the “Settlement”) whereby plaintiff agreed to resolve the lawsuit in exchange for a settlement payment of $8,500, consisting of cash payments previously made by the Company of approximately $1,000 and an additional cash payment of approximately $7,500 funded by the Company’s Directors and Officers (“D&O”) liability insurance policies. The definitive settlement agreement is currently being negotiated between the parties. Once finalized, the settlement agreement will be submitted to the Court of Chancery for final approval.

On August 1, 2023, a class action lawsuit was filed in the United States District Court of New Jersey by plaintiff William Houck against the Company, the Company’s Chief Executive Officer, its former Chief Financial Officer and its current Chief Financial Officer (with the Company, the “Houck Defendants”). The Complaint alleges that the defendants violated federal securities laws by making knowingly false or misleading statements about the Company’s contractual relationship with a customer and about the size of the Company’s order backlog and commercial pipeline. Defendants deny the allegations and, on February 13, 2024, moved to dismiss the Complaint. On March 5, 2024, plaintiff filed an amended complaint that dropped the Company’s former Chief Financial Officer as a defendant. On April 4, 2024, defendants filed a renewed motion to dismiss the lawsuit. The Company intends to continue to vigorously defend against this action.

16. Stock-Based Compensation

Stock-based compensation expense included in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended March 31,
	2024		2023
Stock options	$	174	$	740
Restricted stock units	2,767		2,623
Total	$	2,941	$	3,363

The stock compensation expense has been recorded in cost of goods sold, research and development expenses and selling, general and administrative expenses.

As of March 31, 2024, total unrecognized compensation expense was $12,448 of which $12,358 was attributable to unvested restricted stock units (“RSU”) and $90 was attributable to unvested stock options. Compensation expense for these unvested awards is expected to be recognized over a weighted-average remaining vesting period of 2.1 years for RSUs and 0.1 years for stock options.

17. Income Taxes

For the three months ended March 31, 2024 and 2023, income tax expense was $25 and $10, respectively, related to state margin taxes and taxable earnings from foreign operations. The income tax expense differs from the amount computed by applying the statutory U.S. federal income tax rate of 21% to the loss before income taxes. This is due to non-taxable income, foreign operations and pre-tax losses for which no tax benefit can be recognized for U.S. income tax purposes.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

17. Income Taxes (cont.)

The Company estimates and applies the annual effective tax rate to its ordinary earnings each interim period. Any significant unusual or infrequent items are not included in the estimation of the annual effective tax rate; instead, these items and their related income tax expense are separately stated in the interim period in which they occur. The quarterly estimate of the annual effective tax rate and related tax expense is subject to variation due to a multitude of factors, including, but are not limited to, the inability to accurately predict the Company’s pre-tax and taxable income and loss.

At each balance sheet date, management assesses the likelihood that the Company will be able to realize its deferred tax assets. Management considered all available positive and negative evidence in assessing the need for a valuation allowance. The realization of deferred tax assets depends on the generation of sufficient taxable income of the appropriate character and in the appropriate taxing jurisdiction during the future periods in which the related temporary differences become deductible. Management has determined that it is unlikely that the Company will be able to utilize its U.S. deferred tax assets at March 31, 2024 and December 31, 2023 due to cumulative losses. Therefore, the Company has a valuation allowance against its net U.S. deferred tax assets.

As of March 31, 2024 and December 31, 2023, the Company has unrecognized tax benefits associated with uncertain tax positions that, if recognized, would not affect the effective tax rate on income from continuing operations. The Company is not currently under examination by any taxing jurisdiction and none of the uncertain tax positions are expected to reverse within the next 12 months.

The Company files income tax returns in U.S. federal and various state jurisdictions, as well as in Italy and India. The open tax years for federal returns are 2020 and forward and open tax years for state returns are generally 2019 and forward. In addition, net operating losses generated in closed years and utilized in open years are subject to adjustment by the tax authorities.

18. Shareholders’ Deficit

Preferred Stock

The Company is authorized to issue 1,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s Board of Directors. At March 31, 2024 and December 31, 2023, there were no shares of preferred stock issued or outstanding.

Common Stock

The Company is authorized to issue 300,000,000 shares of common stock at $0.0001 par value as of March 31, 2024. The holders of the Company’s common stock are entitled to one vote for each share held. At March 31, 2024 and December 31, 2023, there were 206,779,447 and 199,133,827 shares of common stock issued and outstanding.

Treasury Stock

The Company recorded treasury stock of $308 and $345 for the three months ended March 31, 2024 and 2023 for shares withheld from employees to cover the payroll tax liability of RSUs vested, respectively. The treasury stock was immediately retired.

Warrants Liability

The Company has outstanding private warrants from the IPO warrants, the April 2023 warrants, the May 2023 warrants and the December 2023 warrants. Warrants liability is included separately on the Unaudited Condensed Consolidated Balance Sheets. See Note 13, Warrants Liability for further discussion.

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

18. Shareholders’ Deficit (cont.)

Public Warrants

The Company sold warrants to purchase 9,075,000 shares of the Company’s common stock in a public offering on May 22, 2020 (the “Public Warrants”). Each Public Warrant entitles the holder to purchase a share of common stock at a price of $11.50 per share. There were no Public Warrants exercised during the three months ended March 31, 2024 and 2023. As of March 31, 2024 and December 31, 2023, there were 7,052,254 public warrants outstanding for both periods.

Standby Equity Purchase Agreement

During the three months ended March 31, 2023, total funds raised under the SEPA, inclusive of proceeds received from the Yorkville Convertible Promissory Notes, were $20,850. During the three months ended March 31, 2023, total shares issued under the SEPA were 11,900,400.

On August 23, 2023, the Company and Yorkville terminated the SEPA, as amended, by mutual written consent. At the time of termination, there were no outstanding borrowings, advance notices or shares of Common Stock to be issued under the SEPA. In addition, there were no fees due by the Company or Yorkville in connection with the termination of the SEPA.

At-the-Market Offering Program

The Company has a sales agreement with Cowen and Company, LLC (“Cowen”), with respect to an at-the-market offering (“ATM”) program under which the Company may offer and sell, from time to time at its sole discretion, shares of its common stock, having an aggregate offering price of up to $200,000 through Cowen as its sales agent and/or principal.

During the three months ended March 31, 2024, the Company sold 7,239,982 shares raising proceeds of $7,206, net of fees paid to Cowen, at an average selling price of $1.03 per share. There were no shares issued under the ATM offering program for the three months ended March 31, 2023.

Earnings Per Share

Basic earnings per share (“EPS”) is computed by dividing earnings available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Other potentially dilutive common shares and the related impact to earnings are considered when calculating EPS on a diluted basis. Since the Company incurred a net loss for the three months ended March 31, 2024 and 2023, the potential dilutive shares from stock options, restricted stock units, warrants and Convertible Notes were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented. Therefore, basic and diluted EPS are computed using the same number of weighted-average shares for the three months ended March 31, 2024 and 2023.

The following potentially dilutive shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:


	Three Months Ended March 31,
	2024	2023
Stock options and restricted stock units	9,048,602	6,987,945
Warrants	61,411,393	7,326,654
Convertible Notes	16,226,124	16,950,606

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EOS ENERGY ENTERPRISES, INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts)

19. Subsequent Events

On April 22, 2024, the Company closed an agreement with Banyan Software, Inc. to accelerate its 2023 Production Tax Credit monetization. The Company received $2,303 in cash. This amount relates to a portion of the PTC grant receivable as of March 31, 2024, as discussed in Note 10, Government Grants.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the accompanying Unaudited Condensed Consolidated Financial Statements for the three months ended March 31, 2024 and 2023 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, including the financial statements and notes thereto.

Overview

The Company offers an innovative Znyth™ technology battery energy storage system ("BESS") designed to provide the operating flexibility to manage increased grid complexity and price volatility resulting from an overall increase in renewable energy generation and a congested grid coming from an increase in electricity demand growth. The Company’s BESS is a validated chemistry with accessible non-precious earth components in a durable design that is intended to deliver results in even the most extreme temperatures and conditions. The system is designed to be safe, flexible, scalable, sustainable and manufactured in the United States using raw materials primarily sourced in the United States. We believe the Company’s Z3™ battery module is the core of its innovative systems. The Z3 battery module is the only US designed and manufactured battery module that today provide utilities, independent power producers, renewables developers and C&I customers with an alternative to lithium-ion and lead-acid monopolar batteries for critical 3- to 12-hour discharge duration applications. We believe the Z3 battery will transform how utility, industrial and commercial customers store power.

In addition to its BESS, the Company currently offers: (a) a BMS which provides a remote asset monitoring capability and service to track the performance and health of the Company’s BESS and to proactively identify future system performance issues through predictive analytics; (b) project management services to ensure the process of implementing the Company’s BESS are coordinated in conjunction with the customer’s overall project plans; (c) commissioning services that ensure the customer’s installation of the BESS meets the performance expected by the customer; and (d) long-term maintenance plans to maintain optimal operating performance of the Company’s systems.

The Company’s growth strategy contemplates increasing sales of battery energy storage systems and related software and services through a direct sales team and sales channel partners. The Company’s current and target customers include utilities, project developers, independent power producers and commercial and industrial companies.

Strategy

The Company continues to invest in the refinement and production of its Z3 battery, which builds off the same electrochemistry that has not fundamentally changed for the better part of a decade. The next Z3 battery is designed to reduce cost and weight while improving manufacturability and system performance. The Eos Z3 battery is more cost-effective and has a simpler tub design with 50% fewer cells and 98% fewer welds per battery module than the Gen 2.3. The Company currently expects that the Z3 battery will give customers the benefit of two times the energy density per square foot with the same safety and reliability. The Z3 transition is fully underway and the first semi-automated battery manufacturing line is installed and has started commercial production. The Z3 batteries utilize the same chemistry, which has over 3 million cycles, and incorporate a new mechanical design aimed at improving performance, lowering cost and increasing manufacturability.

The Company started delivery of its Z3 battery modules in the third quarter of 2023. The Z3 battery incorporates valuable lessons learned from the past 15 years into a new system design which the Company expects to result in efficiencies as it develops its new state-of-the-art manufacturing line.

The Company believes the simplicity, flexibility and safety of our products are what the market desires. In addition, we believe that the Inflation Reduction Act gives us a competitive advantage by virtue of production tax credits (“PTC”) that can be claimed on battery components manufactured domestically, and tax credits for customers for projects that satisfy domestic content requirements. See Regulatory Landscape section. The Company intends to engage with a consortium of community leaders, universities and supply chain partners in anticipation of pursuing grants made available under the Bipartisan Infrastructure Law of 2021.

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Regulatory Landscape

U.S. Department of Energy (“DOE”)

In August 2023, the DOE issued a Conditional Commitment Letter to the Company for a loan of an aggregate principal amount of up to $398.6 million through the DOE’s Clean Energy Financing Program. The Conditional Commitment Letter follows an extensive technical, financial and commercial due diligence process by the DOE. If finalized, the loan is expected to fund 80% of eligible costs of the Company’s planned manufacturing expansion in Turtle Creek, Pennsylvania.

Eligible costs include capital expenditures and other costs associated with ramping up the manufacturing lines and facility, for example start-up and shakedown costs, as well as certain material and labor costs before efficiencies are met. The Company is working to finalize the loan documents with the DOE and to fulfill certain conditions precedent. Eos is spending eligible costs now that would be reimbursable at first funding.

Inflation Reduction Act of 2022 (“IRA”)

The IRA features significant economic incentives for both energy storage customers and manufacturers for projects placed in service after December 31, 2022. One of the most important features of the IRA is that it offers a 10-year term tax credit, whereas historically similar industrial credits have been shorter in duration. Customers placing new energy storage facilities in service will be allowed to claim at least a thirty percent investment tax credit (“ITC”) under certain conditions. The IRA also offers an extra ten percent credit if the project is in an “energy community” and another ten percent credit if the project satisfies domestic content requirements, which will be set forth when the implementing regulations are finalized. The ten percent bonus for domestic content could represent a strategic advantage for the Company resulting from the Company’s near-sourcing and Made in America strategy, and we currently anticipate that projects utilizing Eos batteries will qualify for the bonus.

As discussed in Note 10, Government Grants to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report, starting in 2023, there are Production Tax Credits under Internal Revenue Code 45X (“PTC”) that can be claimed on battery components manufactured in the U.S. and sold to U.S. or foreign customers. These tax credits available to manufacturers include a credit for ten percent of the cost incurred to make electrode active materials in addition to credits of $35 per kWh of capacity of battery cells and $10 per kWh of capacity of battery modules. These credits are cumulative, meaning that companies will be able to claim each of the available tax credits based on the battery components produced and sold through 2029, after which the PTC will begin to gradually phase down through 2032. These credits are expected to be a new source of cash flow for Eos in the future.

Company Highlights

•In January 2024, the Company entered into a supply agreement with TETRA Technologies, Inc (“TETRA”) that further expanded this partnership. TETRA is a leading global energy services and solutions company. This supply agreement designates TETRA as the preferred strategic supplier of electrolyte products for the Company’s Eos Z3TM long duration energy storage cube.

•In February 2024, the Company entered into a multiyear pricing agreement with SHPP US LLC, a Saudi Basic Industries Corporation (“SABIC”) affiliate, to supply conductive composite thermoplastic for the Eos Z3TM battery module. The Company and SABIC have worked collaboratively to develop a solution using one of SABIC’s new resin materials to replace the titanium used in prior Eos battery iterations.

•In February 2024, the Company achieved “Power On” status of all motion systems on its first state-of-the-art manufacturing line. Reaching this milestone is a significant step in achieving the state-of-the-art manufacturing line being installed and commissioned in the Company’s Turtle Creek facility.

•For the three months ended March 31, 2024, the Company recognized $1.5 million of grant income related to the IRA PTC.

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Results of Operations

Revenue


	For the Three Months Ended March 31,
($ in thousands)	2024		2023		$ Change	% Change

Revenue	$	6,601	$	8,835	(2,234)	(25)	%

The Company generates revenues from the delivery of its battery energy storage systems (“BESS”) and service-related solutions. The Company expects revenues to increase as it scales production to meet customer demand.

Revenue decreased by $2.2 million, or 25% from $8.8 million for the three months ended March 31, 2023 to $6.6 million for the three months ended March 31, 2024. The reduction in revenues for the three months ended March 31, 2024 was due to reduced production and deliveries in view of the Company’s shift to next generation Eos Z3TM technology.

Cost of goods sold


	For the Three Months Ended March 31,
($ in thousands)	2024		2023		$ Change	% Change

Cost of goods sold	$	28,229	$	26,940	1,289	5	%

Cost of goods sold primarily consists of direct costs relating to labor, material and overhead directly tied to product manufacturing, engineering, procurement and construction (“EPC”), project delivery, commissioning and start-up test procedures. Indirect costs included in cost of goods sold are manufacturing overhead such as manufacturing engineering, equipment maintenance, environmental health and safety, quality and production control procurement, transportation, logistics, depreciation and facility-related costs. As a nascent technology with a new manufacturing process that is early in its product lifecycle, the Company still faces significant costs associated with production start-up, commissioning of various components, modules and subsystems and other related costs. The Company expects its cost of goods sold to exceed revenues in the near term as it continues to scale production and prepares battery energy storage systems delivered to customers to go-live.

Cost of goods sold increased by $1.3 million, or 5% from $26.9 million for the three months ended March 31, 2023 to $28.2 million for the three months ended March 31, 2024. The increase was primarily due to higher volume of cubes produced and shipped during the three months ended March 31, 2024 compared to the three months ended March 31, 2023.

Research and development expenses


	For the Three Months Ended March 31,
($ in thousands)	2024		2023		$ Change	% Change

R&D expenses	$	5,200	$	5,445	(245)	(4)	%

Research and development expenses consist primarily of salaries and other personnel-related costs, materials, third-party services, depreciation and amortization of intangible assets.

Research and development costs decreased by $0.2 million or 4% from $5.4 million for the three months ended March 31, 2023 to $5.2 million for the three months ended March 31, 2024. The decrease was driven by lower spending on materials and supplies, partially offset by an increase in payroll and personnel costs and stock compensation costs.

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Selling, general and administrative expenses


	For the Three Months Ended March 31,
($ in thousands)	2024		2023		$ Change	% Change

SG&A expenses	$	14,242	$	13,955	287	2	%

Selling, general and administrative expenses primarily consist of payroll and personnel-related, outside professional services, facilities, depreciation, travel, marketing and public company costs.

Selling, general and administrative expenses increased by $0.3 million or 2% from $14.0 million for the three months ended March 31, 2023 to $14.2 million for the three months ended March 31, 2024. The slight increase was driven by increases in payroll, personnel costs and facility costs, partially offset by lower stock compensation costs.

Loss from write-down of property, plant and equipment


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Loss from write-down of property, plant and equipment	$	65	$	760

The Company incurred a loss of $0.1 million and $0.8 million from write-down of property, plant and equipment for the three months ended March 31, 2024 and 2023, respectively, due to write-offs for disposal of equipment and tooling that was used to manufacture the Gen 2.3 BESS, but cannot be repurposed for the next generation Eos Z3 battery.

Interest expense, net


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Interest expense, net	$	(4,267)	$	(4,829)

Interest expense, net includes expenses for accrued interest, amortization of debt issuance costs and debt discounts, partially offset by capitalized interest costs on CIP assets (see Note 6, Property, Plant and Equipment for further discussion). Interest expense, net decreased slightly by $0.6 million for the three months ended March 31, 2024, primarily due to the capitalized interest on CIP assets recognized in 2024, offset by increased interest expense recognized from the Senior Secured Term Loan.

Interest expense - related party


	For the Three Months Ended March 31,
($ in thousands)	2024		2023
2021 Convertible Note Payable interest and amortization	$	(3,416)	$	(2,961)
AFG Convertible Note interest and amortization	(1,435)		(969)
AFG Convertible Note Day 1 loss	—		(2,873)
Yorkville Promissory Notes Day 1 losses	—		(6,952)
Interest expense, related party	$	(4,851)	$	(13,755)

See Note 12, Borrowings to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report for further discussion.

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Change in fair value of warrants

The change in fair value of warrants is composed of the following:


	For the Three Months Ended March 31,
	2024		2023
IPO warrants	$	6	$	(156)
April 2023 warrants	782		—
May 2023 warrants	186		—
December 2023 warrants	1926		—
Change in fair value of warrants	$	2,900	$	(156)

Change in fair value of derivatives - related parties


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Change in fair value of derivatives - related parties	$	534	$	(12,934)

The change in the fair value of derivatives - related parties, is due to changes in fair value of the embedded derivatives in our convertible debt (See Note 12, Borrowings) for the three months ended March 31, 2024, compared to the three months ended March 31, 2023. The change was largely a result of the change in the Company's stock price.

Loss on debt extinguishment


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Loss on debt extinguishment	$	—	$	(1,634)

The Company recognized a loss on debt extinguishment of $1.6 million for the three months ended March 31, 2023 from the issuance of common stock upon Yorkville's redemption of their Convertible Promissory Notes.

Other income (expense)


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Other income (expense)	$	136	$	(17)

Other income (expense) slightly increased by $0.2 million for the three months ended March 31, 2024, compared to the three months ended March 31, 2023.


	For the Three Months Ended March 31,
($ in thousands)	2024		2023

Income tax expense	$	25	$	10

The Company incurred income tax expense for the three months ended March 31, 2024 and 2023 in relation to the pre-tax income from the Company’s international subsidiaries.

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Liquidity and Capital Resources

Liquidity and Going Concern

As of the date the accompanying Condensed Consolidated Financial Statements were issued (the “issuance date”), management evaluated the significance of the following negative financial conditions in accordance with Accounting Standard Codification 205-40, Going Concern:

•Since its inception, the Company has incurred significant losses and negative cash from operations in order to fund its development. During the three months ended March 31, 2024, the Company incurred a net loss of $46.7 million, incurred negative cash flows from operations of $40.5 million and had an accumulated deficit of $922.6 million as of March 31, 2024.

•As of March 31, 2024, the Company had $31.8 million of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $22.1 million, inclusive of $3.5 million of outstanding debt that is currently scheduled to mature within the next twelve months. Additionally, the Company has no additional borrowings available under pre-existing financing arrangements to fund its operations (see Note 12, Borrowings).

•The Company has available capacity under its ATM offering program to issue shares of the Company’s common stock, (see also Note 18, Shareholders’ Deficit) to aid in funding the Company’s operations. However, the Company’s ability to secure such funding is dependent upon certain conditions, such as investors’ willingness to purchase the Company’s common stock and at a price that is acceptable to the Company. Accordingly, as of the issuance date, there is no assurance the Company will be able to secure funding under these pre-existing arrangements or on terms that are acceptable to the Company.

•Similarly, while the Company has historically been successful in raising additional outside capital to fund the Company’s operations, as of the issuance date no assurance can be provided the Company will be successful in obtaining additional outside capital or on terms that are acceptable to the Company. In this regard, the Company continues to progress through the Department of Energy (“DOE”) Loan Programs Office’s (“LPO”) process for its Title XVII loan. In August 2023, the DOE issued a conditional commitment letter to the Company for a loan of an aggregate principal amount of up to $398.6 million through the DOE’s Clean Energy Financing Program. Certain technical, legal and financial conditions must be met and due diligence to the satisfaction of the DOE must be completed before the DOE enters into definitive financing documents with the Company and funds the loan. There can be no assurance that the Company will be able to secure such a loan or on terms that are acceptable to the Company.

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•The Company is required to remain in compliance with a quarterly minimum financial liquidity covenant under its Senior Secured Term Loan Credit Agreement (“Senior Secured Term Loan”). While the Company was in compliance with this covenant as of March 31, 2024, the Company expects it may be unable to remain in compliance with this covenant beginning on June 30, 2024 and thereafter absent the Company’s ability to secure a waiver or raise additional outside capital. In the event the Company is unable to remain in compliance with the minimum financial liquidity covenant and the other nonfinancial covenants required by the Senior Secured Term Loan and the Company is further unable to cure such noncompliance or secure a waiver, Lender - Atlas Credit Partners (ACP) Post Oak Credit I LLC (“Atlas”) may, at its discretion, exercise any and all of its existing rights and remedies, which may include, among other things, entering into a forbearance agreement with the Company and/or asserting its rights in the Company’s assets securing the loan. Moreover, the Company’s other lenders may exercise similar rights and remedies under the cross-default provisions of their respective borrowing arrangements with the Company.

•Absent an ability to secure additional outside capital in the near term, the Company will be unable to meet its obligations as they become due over the next twelve months beyond the issuance date.

Financing Arrangements

The Company has historically relied on outside capital to fund its cost structure and expects this reliance to continue for the foreseeable future until the Company reaches profitability through its planned revenue generating activities. During the three months ended March 31, 2024, the Company closed on the following capital transactions:

•Under the ATM offering program, for the three months ended March 31, 2024, the Company sold 7,239,982 shares raising proceeds of $7.2 million, net of fees paid to Cowen, at an average selling price of $1.03 per share, included in the Condensed Consolidated Statement of Shareholders' Deficit.

Capital Expenditures

The Company expects capital expenditures and working capital requirements to increase as it executes its growth strategy. Total capital expenditures for the three months ended March 31, 2024 and March 31, 2023 were $4.0 million and $2.9 million, respectively. The increase in capital expenditures in 2024 was primarily driven by costs incurred for development and construction of a fully automated manufacturing line that will be used for the Z3™ battery in 2024 and years thereafter. These costs are classified as Construction in Progress (see Note 6, Property, Plant and Equipment for further discussion).

Discussion and Analysis of Cash Flows

The Company relies heavily on private placement of convertible notes, term loans, equipment financing and issuance of common stock and warrants. Our short-term working capital needs are primarily related to funding of debt interest payments, repayment of debt principal, product manufacturing, research and development and general corporate expenses. The Company’s long-term working capital needs are primarily related to repayment of long-term debt obligations and capital expenses for capacity expansion and maintenance, equipment upgrades and repair of equipment.

The following table summarizes the Company’s cash flows from operating, investing and financing activities for the periods presented.


	Three Months Ended March 31,
($ in thousands)	2024		2023		$ Change
Net cash used in operating activities	$	(40,474)	$	(30,478)	$	(9,996)
Net cash used in investing activities	$	(4,042)	$	(2,897)	$	(1,145)
Net cash provided by financing activities	$	6,111	$	32,455	$	(26,344)

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Cash flows from operating activities:

Cash flows used in operating activities primarily comprise of costs related to research and development, manufacturing of products, project commissioning and other general and administrative activities.

Net cash used in operating activities of $40.5 million for the three months ended March 31, 2024 was primarily driven by a net loss of $46.7 million, adjusted for non-cash items of $3.5 million, primarily related to stock compensation expense, depreciation and amortization, non-cash interest expense and changes in fair value of warrants and derivatives. The net cash inflows from changes in operating assets and liabilities was $2.7 million, primarily driven by increase in accrued expenses of $6.2 million, increase in interest payable of $2.9 million, decrease in inventory of $2.7 million, partially offset by increase in contract assets of $4.6 million, decrease in accounts payable of $2.6 million and increase in grant receivable of $1.5 million.

Net cash used in operating activities was $30.5 million for the three months ended March 31, 2023, primarily driven by a net loss of $71.6 million, adjusted for non-cash items of $34.0 million, primarily related to stock compensation expense, depreciation and amortization, non-cash interest expense, changes in fair value of warrants and derivatives and loss from the write-down of property, plant and equipment. The net cash inflows from changes in operating assets and liabilities was $7.1 million, primarily driven by a decrease in inventory of $9.2 million, increase in accounts payable and accrued expenses of $4.8 million and increase in interest payable of $2.4 million, offset by decrease in contract liabilities of $3.5 million, increase in accounts receivable of $2.0 million and increase in contract assets of $1.9 million.

Cash flows from investing activities:

Net cash flows used in investing activities for the three months ended March 31, 2024 were composed of payments made for purchases of property, plant and equipment of $4.0 million.

Net cash flows used in investing activities for the three months ended March 31, 2023 were primarily composed of payments made for purchases of property, plant and equipment of $2.9 million.

Cash flows from financing activities:

Net cash provided by financing activities was $6.1 million for the three months ended March 31, 2024, primarily due to the issuance of common stock of $7.2 million. The proceeds were partially offset by payments on the equipment financing facility of $0.8 million and share repurchases from employees for tax withholding purposes of $0.3 million.

Net cash provided by financing activities was $32.5 million for the three months ended March 31, 2023, primarily due to the net proceeds received from the Yorkville Convertible Promissory Notes and AFG Convertible Notes of $33.4 million and the issuance of common stock of $1.3 million. The proceeds were partially offset by debt issuance costs related to the Yorkville Convertible Promissory Notes and AFG Convertible Notes of $1.1 million, payments on the equipment financing facility of $0.7 million and share repurchases from employees for tax withholding purposes of $0.3 million.

Contractual Obligations

The Company has certain obligations and commitments to make future payments under contracts. As of March 31, 2024, this is composed of the following:

•Future lease payments, including interest, under non-cancellable operating and financing leases of $5.6 million. The leases expire at various dates prior to 2028. See Note 15, Commitments and Contingencies to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report.

•Principal and Interest payments related to the following debt obligations (see Note 12, Borrowings to our Unaudited Condensed Consolidated Financial Statements included elsewhere in this Quarterly Report):


	Future Debt Payments
2021 Convertible Note Payable - due June 2026 (1)	$	134,261
AFG Convertible Notes - due June 2026 (1)	32,468
Senior Secured Term Loan - due March 2026	128,300
Equipment financing facility - due April 2025 and April 2026	5,583
Total	$	300,612

(1) As of March 31, 2024, the Company is obligated to repay future contractual interest payments for the 2021 Convertible Note and AFG Convertible Notes in-kind.

Table of Contents

Critical Accounting Estimates

The Company’s Unaudited Condensed Consolidated Financial Statements are prepared in conformity with U.S. generally accepted accounting principles (U.S. GAAP). In preparing the Company’s Unaudited Condensed Consolidated Financial Statements, management makes assumptions, judgments and estimates on historical experience and various other factors that management believes to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. Management regularly reevaluates assumptions, judgments and estimates. The Company’s significant accounting policies are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

There have been no material changes to the Company’s critical accounting estimates for the three months ended March 31, 2024, as compared to those discussed in its Annual Report on Form 10-K for the year ended December 31, 2023.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in the Company’s market risk exposures for the three months ended March 31, 2024, as compared to those discussed in its Annual Report on Form 10-K for the year ended December 31, 2023.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s management, under the supervision of the Chief Executive Officer (CEO) and the Chief Financial Officer (CFO), evaluated the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based upon that evaluation and consistent with the evaluations previously reported in prior periods, the CEO and CFO have concluded that the Company’s disclosure controls and procedures were not effective as of March 31, 2024 because of material weaknesses resulting from lack of a formalized internal control framework in accordance with the Committee of Sponsoring Organizations (COSO) Framework, inadequate segregation of duties in the financial reporting process, lack of review and approval of journal entries and a lack of management review controls.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in the Company’s reports filed under the Exchange Act is accumulated and communicated to management, including its CEO and its CFO, to allow timely decisions regarding required disclosure.

In light of these material weaknesses, management performed additional analyses, reconciliations and other post-closing procedures to determine that the Company’s Unaudited Condensed Consolidated Financial Statements are prepared in accordance with U.S. GAAP. Based on this review, management concluded that the Unaudited Condensed Consolidated Financial Statements included in this report fairly present in all material respects the Company’s financial condition, results of operations and cash flows for the periods presented.

Management’s Remediation Plan

In response to the material weaknesses, management, with oversight from the Audit Committee has identified and begun to implement steps to remediate the material weaknesses. These remediation efforts are detailed in Item 9A,“Controls and Procedures” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

Changes in Internal Control Over Financial Reporting

Other than the actions taken as described in Management's Remediation Plan above to improve the Company’s internal control over financial reporting, there have been no changes in our internal control over financial reporting during the quarter ended March 31, 2024 that materially affected, or which are reasonably likely to materially affect, our internal control over financial reporting.

Part II - Other information

Item 1. Legal Proceedings

Table of Contents

From time to time, the Company may be involved in litigation relating to claims arising out of the Company’s operations. While the outcomes of these types of claims are uncertain, management does not expect that the ultimate costs to resolve these matters will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

The following is also disclosed in Note 15, Commitments and Contingencies to our Unaudited Condensed Consolidated Financial Statements:

Class Action Complaints

Item 1A. Risk Factors

As of the date of this Quarterly Report on Form 10-Q, there have been no additional material changes to the risk factors disclosed in our annual report on Form 10-K for the fiscal year ended December 31, 2023. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None

Item 3. Defaults Upon Senior Securities

None

Item 4. Mine Safety Disclosures

None

Item 5. Other Information

None

Table of Contents

(a) Exhibits

Incorporated by Reference

Exhibit Number

Description of Document

Schedule/Form

File Number

Exhibits

Filing Date

3.1

Third Amended and Restated Certificate of Incorporation of the Company, as amended

Form 10-K

File No. 001-39291

3.1

February 28, 2023

3.2*

Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of the Company, as amended

3.3

Second Amended and Restated Bylaws of the Company

Form 8-K

File No. 001-39291

3.1

May 19, 2022

10.1

Eos Energy Enterprises, Inc. 2020 Incentive Plan

Form 8-K

File No. 001-39291

10.10

November 20, 2020

10.2†

Amended and Restated Manufacturing Purchase and Supply Agreement dated January 8, 2024, by and between HI-POWER, LLC and TETRA Technologies, Inc.

Form 8-K

File No. 001-39291

10.1

January 9, 2024

10.3†

Pricing Agreement dated January 31, 2024, by and between HI-POWER, LLC and SHP US LLC

Form 8-K

File No. 001-39291

10.1

February 1, 2024

10.4

F irst Amendment to the Amended and R e stated 2020 Inc entive Plan

Form S-8

File No. 001-39291

99.2

June 17, 2022

10.5

Second Amendment to the Amended and Restated 2020 Incentive Plan

Form S-8

File No. 001-39291

99.3

June 23, 2023

10.6*

Third Amendment to the Amended and Restated 2020 Incentive Plan

31.1*

Certification of Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2*

Certification of Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32*

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH

XBRL Taxonomy Extension Schema Document

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document

Table of Contents

Incorporated by Reference

Exhibit Number

Description of Document

Schedule/Form

File Number

Exhibits

Filing Date

101.LAB

XBRL Taxonomy Extension Label Linkbase Document

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

____________________________

†Certain of the exhibits and schedules to this exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5) and certain confidential portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. These redacted terms have been marked in this exhibit at the appropriate place with three asterisks. The Registrant agrees to furnish an unredacted copy and a copy of all omitted exhibits and schedules to the SEC upon its request.

*Filed herewith.

Table of Contents

SIGNATURES

Pursuant to the requirements of 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.


	EOS ENERGY ENTERPRISES, INC.

Date: May 14, 2024	By:	/s/ Joseph Mastrangelo
	Name:	Joseph Mastrangelo
	Title:	Chief Executive Officer and Director (Principal Executive Officer)



Date: May 14, 2024	By:	/s/ Nathan Kroeker
	Name:	Nathan Kroeker
	Title:	Chief Financial Officer (Principal Financial Officer)

EOS ENERGY ENTERPRISES, INC. Second Certificate of Amendment to The Third Amended and Restated Certificate of Incorporation FIRST: The present name of the corporation is Eos Energy Enterprises, Inc., a Delaware corporation (the “Corporation”). The original certificate of incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on June 3, 2019. An Amended and Restated Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on February 4, 2020. A Second Amended and Restated Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on May 19, 2020. A Third Amended and Restated Certificate of Incorporation (the “Third Amended and Restated Certificate”) was filed with the Secretary of State of the State of Delaware on November 16, 2020. A certificate of amendment to the Third Amended and Restated Certificate was filed with the Secretary of State of the State of Delaware on June 28, 2022. SECOND: Section 4.1(b) of Article IV of the Company’s Third Amended and Restated Certificate is hereby amended to read in its entirety as set forth below: (b) The total number of shares of all classes of capital stock, each with a par value of $0.0001 per share, which the Corporation is authorized to issue is 601,000,000 shares, consisting of (a) 600,000,000 shares of common stock (the “Common Stock”) and (b) 1,000,000 shares of preferred stock (the “Preferred Stock”). THIRD: The foregoing amendment has been duly proposed and declared advisable by the Corporation’s Board of Directors and adopted by the Corporation’s stockholders in accordance with the provisions of Sections 222 and 242 of the General Corporation Law of the State of Delaware. FOURTH: This Second Certificate of Amendment shall become effective as of upon the filing of this Second Certificate of Amendment with the Secretary of State of the State of Delaware. * * * * * IN WITNESS WHEREOF, the Corporation has caused this Second Certificate of Amendment to be signed by an authorized officer of the Corporation this 8th day of May, 2024. Eos Energy Enterprises, Inc. By: /s/Michael W. Silberman Michael Silberman General Counsel and Corporate Secretary

Third Amendment to the Eos Energy Enterprises, Inc. Amended and Restated 2020 Incentive Plan This Third Amendment (this “Amendment”) to the Eos Energy Enterprises, Inc. Amended and Restated 2020 Incentive Plan (as amended, restated, replaced, supplemented, or otherwise modified from time to time, the “Plan”) is approved and adopted to be effective as of May 1, 2024 (the “Effective Date”). Background A. The Plan was previously amended pursuant to the First Amendment to the Plan, dated as of May 17, 2022, and the Second Amendment to the Plan, dated as of May 16, 2023. B. On the Effective Date, the stockholders of Eos Energy Enterprises, Inc., a Delaware corporation (the “Company”) approved this Amendment. C. The Company now desires to amend the Plan in accordance with the terms and conditions of this Amendment. Terms and Conditions NOW THEREFORE, effective as of the Effective Date, the terms and conditions of the Plan are amended as follows: 1. Sections 5(b) of the Plan is hereby deleted in its entirety and replaced with the following: 5. Grant of Awards; Shares Subject to the Plan; Limitations. (b) Subject to Section 12 of the Plan and this Section 5, Awards granted under the Plan shall be subject to the following limitations: (i) the Committee is authorized to deliver under the Plan an aggregate of 23,935,317 Common Stock; provided, that the maximum number of Common Stock that may be granted under the Plan during any single fiscal year to any Participant who is a non-employee director, when taken together with any cash fees paid to such nonemployee director during such year in respect of his service as a non-employee director (including service as a member or chair of any committee of the Board), shall not exceed $500,000 in total value (calculating the value of any such Awards based on the Fair Market Value on the Date of Grant of such Awards for financial reporting purposes); provided that the non-employee directors who are considered independent (under the rules of The Nasdaq Capital Market or other securities exchange on which the Common Stock is traded) may make exceptions to this limit for a non-executive chair of the Board, if any, in which case the non-employee director receiving such additional compensation may not participate in the decision to award such compensation.

Third Amendment to the Eos Energy Enterprises, Inc. May 1, 2024 Amended and Restated 2020 Incentive Plan __________________________________________________________________________________ Page 2 2. Sections 7(a) of the Plan is hereby deleted in its entirety and replaced with the following: 7. Options. (a) Generally. Each Option granted under the Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each Option so granted shall be subject to the conditions set forth in this Section 7 and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement. All Options granted under the Plan shall be Nonqualified Stock Options unless the applicable Award Agreement expressly states that the Option is intended to be an Incentive Stock Option. Subject to Section 12, the maximum aggregate number of Common Stock that may be issued through the exercise of Incentive Stock Options granted under the Plan is 23,935,317 Common Stock. Incentive Stock Options shall be granted only to Eligible Persons who are employees of the Company and its Affiliates, and no Incentive Stock Option shall be granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the Code. No Option shall be treated as an Incentive Stock Option unless the Plan has been approved by the stockholder of the Company in a manner intended to comply with the stockholder approval requirements of Section 422(b)(1) of the Code; provided that any Option intended to be an Incentive Stock Option shall not fail to be effective solely on account of a failure to obtain such approval, but rather such Option shall be treated as a Nonqualified Stock Option unless and until such approval is obtained. In the case of an Incentive Stock Option, the terms and conditions of such grant shall be subject to and comply with such rules as may be prescribed by Section 422 of the Code. If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the extent of such nonqualification, such Option or portion thereof shall be regarded as a Nonqualified Stock Option appropriately granted under the Plan. 3. Incorporation: This Amendment shall be deemed as amending and incorporated into the Plan. All of the terms, conditions, and provisions of the Plan shall continue unchanged and remain in full force and effect except as expressly amended by this Amendment. IN WITNESS WHEREOF, the Company hereby executes this Amendment as of the Effective Date. Eos Energy Enterprises, Inc. By: /s/Michael W. Silberman Michael Silberman General Counsel and Corporate Secretary

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF

THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Joseph Mastrangelo, certify that:

1. I have reviewed this quarterly report on Form 10-Q (the “Report”) of Eos Energy Enterprises, Inc. (the “Registrant”);

2. Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;

3. Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;

c. Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and

d. Disclosed in this Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: May 14, 2024

By:

/s/ Joseph Mastrangelo

Joseph Mastrangelo

Chief Executive Officer

(Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF

THE SECURITIES EXCHANGE ACT OF 1934, AS ADOPTED PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Nathan Kroeker, certify that:

1. I have reviewed this quarterly report on Form 10-Q (the “Report”) of Eos Energy Enterprises, Inc. (the Registrant”);

5. The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

Date: May 14, 2024

By:

/s/ Nathan Kroeker

Nathan Kroeker

Chief Financial Officer

(Principal Financial Officer)

EXHIBIT 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Eos Energy Enterprises, Inc. (the “Registrant”), for the quarterly period ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Joseph Mastrangelo, hereby certify, in the capacity and on the date indicated below, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: May 14, 2024

By:

/s/ Joseph Mastrangelo

Joseph Mastrangelo

Chief Executive Officer

(Principal Executive Officer)

In connection with the Quarterly Report on Form 10-Q of Eos Energy Enterprises, Inc. (the “Registrant”), for the quarterly period ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Nathan Kroeker, hereby certify, in the capacity and on the date indicated below, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: May 14, 2024

By:

/s/ Nathan Kroeker

Nathan Kroeker

Chief Financial Officer

(Principal Financial Officer)

Cover - shares	3 Months Ended
Cover - shares	Mar. 31, 2024	May 08, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity File Number	001-39291
Entity Registrant Name	EOS ENERGY ENTERPRISES, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	84-4290188
Entity Address, Address Line One	3920 Park Avenue
Entity Address, City or Town	Edison
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	08820
City Area Code	732
Local Phone Number	225-8400
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		208,127,550
Entity Central Index Key	0001805077
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common stock, par value $0.0001 per share
Trading Symbol	EOSE
Security Exchange Name	NASDAQ
Warrants
Document Information [Line Items]
Title of 12(b) Security	Warrants, each exercisable for one share of common stock
Trading Symbol	EOSEW
Security Exchange Name	NASDAQ

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 31,773	$ 69,473
Restricted cash	2,625	3,439
Accounts receivable, net	3,953	3,387
Inventory, net	14,393	17,070
Vendor deposits	6,513	7,161
Contract assets, current	11,075	6,386
Prepaid expenses	1,278	1,082
Grant receivable	4,798	3,256
Other receivables	7,500	7,500
Other current assets	3,110	3,577
Total current assets	87,018	122,331
Property, plant and equipment, net	42,742	37,855
Intangible assets, net	282	295
Goodwill	4,331	4,331
Operating lease right-of-use asset, net	3,735	4,033
Long-term restricted cash	11,858	11,755
Other assets, net	5,716	5,892
Total assets	155,682	186,492
Current liabilities:
Accounts payable	18,339	20,540
Accrued expenses	38,614	32,332
Operating lease liability, current	1,574	1,496
Long-term debt, current	3,458	3,332
Contract liabilities, current	2,828	3,070
Other current liabilities	108	100
Total current liabilities	64,921	60,870
Long-term liabilities:
Operating lease liability	2,922	3,350
Long-term debt	88,222	88,002
Convertible notes payable - related party	113,950	112,525
Interest payable - related party	2,892	0
Contract liabilities, long-term	4,283	3,540
Warrants liability	24,561	27,461
Other liabilities	1,604	1,544
Total long-term liabilities	238,434	236,422
Total liabilities	303,355	297,292
COMMITMENTS AND CONTINGENCIES (NOTE 15)
SHAREHOLDERS' DEFICIT
Common stock, $0.0001 par value, 300,000,000 shares authorized, 206,779,447 and 199,133,827 shares outstanding on March 31, 2024 and December 31, 2023, respectively	22	21
Preferred stock, $0.0001 par value, 1,000,000 shares authorized, no shares outstanding on March 31, 2024 and December 31, 2023	0	0
Additional paid in capital	774,857	765,018
Accumulated deficit	(922,554)	(875,846)
Accumulated other comprehensive income	2	7
Total shareholders' deficit	(147,673)	(110,800)
Total liabilities and shareholders' deficit	$ 155,682	$ 186,492

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares issued (in shares)	206,779,447	199,133,827
Common stock, shares outstanding (in shares)	206,779,447	199,133,827
Preferred stock issued per unit (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Revenue
Total revenue	$ 6,601	$ 8,835
Costs and expenses
Cost of goods sold	28,229	26,940
Research and development expenses	5,200	5,445
Selling, general and administrative expenses	14,242	13,955
Loss from write-down of property, plant and equipment	65	760
Total costs and expenses	47,736	47,100
Operating loss	(41,135)	(38,265)
Other (expense) income
Change in fair value of warrants	2,900	(156)
Change in fair value of derivatives - related parties	534	(12,934)
Loss on debt extinguishment	0	(1,634)
Other income (expense)	136	(17)
Loss before income taxes	(46,683)	(71,590)
Income tax expense	25	10
Net loss	(46,708)	(71,600)
Other comprehensive income
Foreign currency translation adjustment, net of tax	(5)	1
Comprehensive loss	$ (46,713)	$ (71,599)
Basic and diluted loss per share attributable to common shareholders
Basic (in dollars per share)	$ (0.23)	$ (0.82)
Diluted (in dollars per share)	$ (0.23)	$ (0.82)
Weighted average shares of common stock
Basic (in shares)	201,306,905	86,797,669
Diluted (in shares)	201,306,905	86,797,669
Nonrelated Party
Other (expense) income
Interest expense, net	$ (4,267)	$ (4,829)
Related Party
Other (expense) income
Interest expense, net	(4,851)	(13,755)
Change in fair value of derivatives - related parties	$ 534	$ (12,934)

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT - USD ($) $ in Thousands	Total	Common Stock	Additional Paid in capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit
Beginning balances (in shares) at Dec. 31, 2022		82,653,781
Beginning balances at Dec. 31, 2022	$ (132,711)	$ 9	$ 513,614	$ 6	$ (646,340)
Increase (decrease) in stockholders' equity [Roll Forward]
Stock-based compensation	3,363		3,363
Release of restricted stock units (in shares)		915,206
Cancellation of shares used to settle payroll tax withholding (in shares)		(246,717)
Cancellation of shares used to settle payroll tax withholding	(345)		(345)
Issuance of common stock (in shares)		11,900,400
Issuance of common stock	25,695	$ 1	25,694
Foreign currency translation adjustment, net of tax	1			1
Net loss	(71,600)				(71,600)
Ending balances (in shares) at Mar. 31, 2023		95,222,670
Ending balances at Mar. 31, 2023	$ (175,597)	$ 10	542,326	7	(717,940)
Beginning balances (in shares) at Dec. 31, 2023	199,133,827	199,133,827
Beginning balances at Dec. 31, 2023	$ (110,800)	$ 21	765,018	7	(875,846)
Increase (decrease) in stockholders' equity [Roll Forward]
Stock-based compensation	2,941		2,941
Release of restricted stock units (in shares)		657,605
Cancellation of shares used to settle payroll tax withholding (in shares)		(251,967)
Cancellation of shares used to settle payroll tax withholding	(308)		(308)
Issuance of common stock (in shares)		7,239,982
Issuance of common stock	7,207	$ 1	7,206
Foreign currency translation adjustment, net of tax	(5)			(5)
Net loss	$ (46,708)				(46,708)
Ending balances (in shares) at Mar. 31, 2024	206,779,447	206,779,447
Ending balances at Mar. 31, 2024	$ (147,673)	$ 22	$ 774,857	$ 2	$ (922,554)

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash flows from operating activities
Net loss	$ (46,708)	$ (71,600)
Adjustment to reconcile net loss to net cash used in operating activities
Stock-based compensation	2,941	3,363
Depreciation and amortization	1,197	2,686
Loss on debt extinguishment	0	1,634
Loss from write-down of property, plant and equipment	65	760
Amortization of right-of-use assets	298	233
Change in fair value of warrants	(2,900)	156
Change in fair value of derivatives - related parties	(534)	12,934
Changes in operating assets and liabilities:
Prepaid expenses	(196)	406
Inventory	2,677	9,185
Accounts receivable	(566)	(1,984)
Vendor deposits	(204)	(917)
Contract assets	(4,572)	(1,914)
Grant receivable	(1,542)	(780)
Accounts payable	(2,593)	(208)
Accrued expenses	6,159	4,991
Interest payable - related party	2,892	2,417
Operating lease liabilities	(350)	(262)
Contract liabilities	501	(3,450)
Other	527	(381)
Net cash used in operating activities	(40,474)	(30,478)
Cash flows from investing activities
Purchases of property, plant and equipment	(4,042)	(2,897)
Net cash used in investing activities	(4,042)	(2,897)
Cash flows from financing activities
Principal payments on finance lease obligations	(2)	(7)
Proceeds from issuance of convertible notes - related party	0	33,350
Repayment of equipment financing facility	(786)	(677)
Proceeds from issuance of common stock	7,207	1,250
Repurchase of shares from employees for income tax withholding purposes	(308)	(345)
Net cash provided by financing activities	6,111	32,455
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(6)	(1)
Net decrease in cash, cash equivalents and restricted cash	(38,411)	(921)
Cash, cash equivalents and restricted cash, beginning of the period	84,667	31,223
Cash, cash equivalents and restricted cash, end of the period	46,256	30,302
Non-cash investing and financing activities
Accrued and unpaid capital expenditures	384	603
Issuance of common stock upon settlement of Yorkville convertible notes	0	24,422
Accrued and unpaid capitalized internal-use software	8	130
Supplemental disclosures
Cash paid for interest	238	3,690
Nonrelated Party
Adjustment to reconcile net loss to net cash used in operating activities
Non-cash interest expense	885	915
Related Party
Adjustment to reconcile net loss to net cash used in operating activities
Non-cash interest expense	1,549	11,338
Change in fair value of derivatives - related parties	(534)	12,934
Cash flows from financing activities
Payment of debt issuance costs - related party	$ 0	$ (1,116)

Overview	3 Months Ended
Overview	Mar. 31, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Overview	Overview Nature of Operations Eos Energy Enterprises, Inc. (the “Company,” “we,” “us,” “our,” and “Eos”) designs, develops, manufactures and markets innovative energy storage solutions for utility-scale, microgrid and commercial & industrial (“C&I”) applications. Eos developed a broad range of intellectual property with multiple patents covering unique battery chemistry, mechanical product design, energy block configuration and a software operating system (Battery Management System). The Company has only one operating and reportable segment. Liquidity and Going Concern As a growth company in the early commercialization stage of its lifecycle, Eos is subject to inherent risks and uncertainties associated with the development of an enterprise. In this regard, substantially all of the Company’s efforts to date have been devoted to the development and manufacturing of battery energy storage systems and complimentary products and services, recruitment of management and technical staff, deployment of capital to expand the Company’s operations to meet customer demand and raising capital to fund the Company’s development. As a result of these efforts, the Company has incurred significant losses and negative cash flows from operations since its inception and expects to continue to incur such losses and negative cash flows for the foreseeable future until such time that the Company can reach a scale of profitability to sustain its operations. In order to execute its development strategy, the Company has historically relied on outside capital through the issuance of equity, debt and borrowings under financing arrangements (collectively “outside capital”) to fund its cost structure and expects to continue to rely on outside capital for the foreseeable future. While the Company believes it will eventually reach a scale of profitability to sustain its operations, there can be no assurance the Company will be able to achieve such profitability or do so in a manner that does not require its continued reliance on outside capital. Moreover, while the Company has historically been successful in raising outside capital, there can be no assurance the Company will be able to continue to obtain outside capital in the future or do so on terms that are acceptable to the Company. As of the date the accompanying Unaudited Condensed Consolidated Financial Statements were issued (the “issuance date”), management evaluated the significance of the following negative financial conditions in accordance with Accounting Standard Codification 205-40, Going Concern: •Since its inception, the Company has incurred significant losses and negative cash from operations in order to fund its development. During the three months ended March 31, 2024, the Company incurred a net loss of $46,708, incurred negative cash flows from operations of $40,474 and had an accumulated deficit of $922,554 as of March 31, 2024. •As of March 31, 2024, the Company had $31,773 of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $22,097, inclusive of $3,458 of outstanding debt that is currently scheduled to mature within the next twelve months. Additionally, the Company has no additional borrowings available under pre-existing financing arrangements to fund its operations (see Note 12, Borrowings). •The Company has available capacity under its at-the-market (“ATM”) offering program to issue shares of the Company’s common stock, (see also Note 18, Shareholders’ Deficit) to aid in funding the Company’s operations. However, the Company’s ability to secure such funding is dependent upon certain conditions, such as investors’ willingness to purchase the Company’s common stock and at a price that is acceptable to the Company. Accordingly, as of the issuance date, there is no assurance the Company will be able to secure funding under these pre-existing arrangements or on terms that are acceptable to the Company. •Similarly, while the Company has historically been successful in raising additional outside capital to fund the Company’s operations, as of the issuance date no assurance can be provided the Company will be successful in obtaining additional outside capital or on terms that are acceptable to the Company. In this regard, the Company continues to progress through the Department of Energy (“DOE”) Loan Programs Office’s (“LPO”) process for its Title XVII loan. In August 2023, the DOE issued a conditional commitment letter to the Company for a loan of an aggregate principal amount of up to $398,600 through the DOE’s Clean Energy Financing Program. Certain technical, legal and financial conditions must be met and due diligence to the satisfaction of the DOE must be completed before the DOE enters into definitive financing documents with the Company and funds the loan. There can be no assurance that the Company will be able to secure such a loan or on terms that are acceptable to the Company. •The Company is required to remain in compliance with a quarterly minimum financial liquidity covenant under its Senior Secured Term Loan Credit Agreement (“Senior Secured Term Loan”). While the Company was in compliance with this covenant as of March 31, 2024, the Company expects it may be unable to remain in compliance with this covenant beginning on June 30, 2024 and thereafter absent the Company’s ability to secure a waiver or raise additional outside capital. In the event the Company is unable to remain in compliance with the minimum financial liquidity covenant and the other nonfinancial covenants required by the Senior Secured Term Loan and the Company is further unable to cure such noncompliance or secure a waiver, the Lender - Atlas Credit Partners (ACP) Post Oak Credit I LLC (“Atlas”) may, at its discretion, exercise any and all of its existing rights and remedies, which may include, among other things, entering into a forbearance agreement with the Company and/or asserting its rights in the Company’s assets securing the loan. Moreover, the Company’s other lenders may exercise similar rights and remedies under the cross-default provisions of their respective borrowing arrangements with the Company. •Absent an ability to secure additional outside capital in the near term, the Company will be unable to meet its obligations as they become due over the next twelve months beyond the issuance date. •In the event the Company’s ongoing efforts to raise additional outside capital prove unsuccessful, management will be required to seek other strategic alternatives, which may include, among others, a significant curtailment in the Company’s operations, a sale of certain of the Company’s assets, a sale of the entire Company to strategic or financial investors and/or allowing the Company to become insolvent. These uncertainties raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying Unaudited Condensed Consolidated Financial Statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates that the Company will be able to realize assets and settle liabilities and commitments in the normal course of business for the foreseeable future. Accordingly, the accompanying Unaudited Condensed Consolidated Financial Statements do not include any adjustments that may result from the outcome of these uncertainties.

Summary of Significant Accounting Policies	3 Months Ended
Summary of Significant Accounting Policies	Mar. 31, 2024
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its 100% owned, direct and indirect subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). All intercompany transactions and balances have been eliminated in the preparation of the Unaudited Condensed Consolidated Financial Statements. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The interim financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in our 2023 Annual Report on Form 10-K. These interim results are not necessarily indicative of results for the full year. 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 and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations. Recent Accounting Pronouncements There were no new accounting standards or updates during the three months ended March 31, 2024 that would have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.

Revenue Recognition

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition


	For the Three Months Ended March 31,
	2024		2023
Product revenue	$	6,501	$	8,675
Service revenue	100		160
Total revenues	$	6,601	$	8,835

Lessor revenue

Contract assets and Contract liabilities


	March 31, 2024		December 31, 2023
Contract assets	$	12,894	$	8,322
Contract liabilities	$	7,111	$	6,610

Remaining Performance Obligations

Cash, Cash Equivalents and Restricted Cash

3 Months Ended

Mar. 31, 2024

Cash and Cash Equivalents [Abstract]

Cash, Cash Equivalents and Restricted Cash

Restricted cash - current consists of escrow deposits related to U.S. Custom Bonds insurance and escrow deposits related to our credit card program agreements.


	March 31, 2024		March 31, 2023
Cash and cash equivalents	$	31,773	$	16,127
Restricted cash - current	2,625		2,725
Long-term restricted cash	11,858		11,450
Total cash, cash equivalents and restricted cash	$	46,256	$	30,302

Inventory

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Inventory

The following table provides information about inventory balances:


	March 31, 2024		December 31, 2023
Raw materials	$	13,045	$	15,487
Work-in-process	490		1,105
Finished goods	858		478
Total inventory, net	$	14,393	$	17,070

Property, Plant and Equipment, Net

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, Net

The following table provides information about property, plant and equipment, net balances:


	Estimated Useful lives	March 31, 2024		December 31, 2023
Equipment	5 to 10 years	$	22,484	$	20,559
Finance lease	5 years	504		504
Furniture	5 to 10 years	2,179		2,103
Leasehold improvements	Lesser of useful life/ remaining lease	7,951		7,718
Tooling	2 to 3 years	7,866		7,045
Construction in progress (“CIP”)		20,819		17,958
Total		61,803		55,887
Less: Accumulated depreciation		(19,061)		(18,032)
Total property, plant and equipment, net		$	42,742	$	37,855

Intangible Assets	3 Months Ended
Intangible Assets	Mar. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets	Intangible Assets Intangible assets include patents valued at $400, which represents the cost to acquire the patents. These patents are determined to have useful lives and are amortized into the results of operations over ten years. The Company recorded amortization expense of $10 for the three months ended March 31, 2024 and 2023 related to patents. The Company capitalized $146 of costs for internal-use software, including $8 of costs capitalized during the three months ended March 31, 2024. The software has a useful life and is amortized into the results of operations over 3 years. The Company recorded amortization expense of $12 and $9 for the three months ended March 31, 2024 and 2023, respectively, related to software.

Notes Receivable, Net and Variable Interest Entities (“VIEs”) Consideration	3 Months Ended
	Mar. 31, 2024
Receivables [Abstract]
Notes Receivable, Net and Variable Interest Entities (“VIEs”) Consideration	Notes Receivable, Net and Variable Interest Entities (“VIEs”) Consideration Notes receivable, net, relates to financing the Company offered to a customer. The Company reports the notes receivable at the principal balance outstanding less an allowance for losses. The estimate of credit losses is based on historical trends, the customer’s financial condition and current economic trends. The Company charges interest at a fixed rate and calculates interest income by applying the effective rate to the outstanding principal balance. The Company had notes receivable, net, of $827 and $863 outstanding as of March 31, 2024 and December 31, 2023, respectively. These amounts are included in Other assets, net and Other current assets in the accompanying Unaudited Condensed Consolidated Balance Sheets. As of March 31, 2024 and December 31, 2023, the allowance for expected credit loss related to the notes receivable amounted to $36 and $2, respectively. The customer to whom the Company offers financing through notes receivable is a VIE. However, the Company is not the primary beneficiary, because the Company does not have power to direct the activities of the VIE that most significantly impact the VIE’s economic performance. Therefore, the VIE is not consolidated into the Company’s consolidated financial statements. The maximum loss exposure is limited to the carrying value of notes receivable as of the balances sheet dates.

Accrued Expenses

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Accrued Expenses

Accrued expenses were as follows:


	March 31, 2024		December 31, 2023
Accrued payroll	$	7,273	$	4,553
Warranty reserve (1)	5,513		6,197
Accrued legal and professional expenses	11,058		10,710
Provision for contract losses	3,205		3,351
Insurance premium payable, current	2,730		2,605
Interest payable, current	3,684		—
Other	5,151		4,916
Total accrued expenses	$	38,614	$	32,332

(1) Refer to the table below for the warranty reserve activity for the three months ended March 31, 2024 and 2023.

The following table summarizes warranty reserve activity:


	Three Months Ended March 31,
	2024		2023
Warranty reserve - beginning of period	$	6,197	$	3,836
Additions for current period deliveries	265		357
Changes in the warranty reserve estimate	(949)		—
Warranty costs incurred	—		(221)
Warranty reserve - end of period	$	5,513	$	3,972

Government Grants	3 Months Ended
Government Grants	Mar. 31, 2024
Government Assistance [Abstract]
Government Grants	Government Grants Inflation Reduction Act of 2022 (“IRA”) On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 into law. The IRA has significant economic incentives for both energy storage customers and manufacturers for projects placed in service after December 31, 2022. Starting in 2023, there are Production Tax Credits under Internal Revenue Code 45X (“PTC”), that can be claimed on battery components manufactured in the U.S. and sold to U.S. or foreign customers. The tax credits available to manufacturers include a credit for ten percent of the cost incurred to make electrode active materials in addition to credits of $35 per kWh of capacity of battery cells and $10 per kWh of capacity of battery modules. These credits are cumulative, meaning that companies will be able to claim each of the available tax credits based on the battery components produced and sold through 2029, after which the PTC will begin to gradually phase down through 2032. In June 2023, the IRS issued temporary and proposed regulations related to applicable tax credit transferability and direct pay provisions of the Inflation Reduction Act. The Company has reviewed these regulations and believes they do not have a material impact on the financial statements. Since the PTC is a refundable credit (i.e., a credit with a direct-pay option available), the PTC is outside the scope of ASC 740. Therefore, the Company accounts for the PTC under a government grant model. GAAP does not address the accounting for government grants received by a business entity that are outside the scope of ASC 740. The Company’s accounting policy is to analogize to IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, under IFRS Accounting Standards. Under IAS 20, once it is reasonably assured that the entity will comply with the conditions of the grant, the grant money is recognized on a systematic basis over the periods in which the entity recognizes the related expenses or losses for which the grant money is intended to compensate. The Company recognizes grants once it is probable that both of the following conditions will be met: (1) the Company is eligible to receive the grant and (2) the Company is able to comply with the relevant conditions of the grant. The PTC is recorded as the applicable items are produced and sold and the conditions in the preceding paragraph are met. For the three months ended March 31, 2024 and 2023, the Company recognized PTC of $1,542 and $798, respectively, as a reduction of cost of goods sold on the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Loss. As of March 31, 2024 and December 31, 2023, grant receivable related to the PTC in the amount of $4,798 and $3,256, respectively, is recorded in the Unaudited Condensed Consolidated Balance Sheets

Related Party Transactions	3 Months Ended
Related Party Transactions	Mar. 31, 2024
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions 2021 Convertible Note Payable In July 2021, the Company issued a convertible note in the aggregate principal amount of $100,000 to Spring Creek Capital, LLC, a wholly-owned, indirect subsidiary of Koch Industries, Inc. (the “2021 Convertible Note”). In connection with the 2021 Convertible Note, the Company paid $3,000 to B. Riley Securities, Inc., a related party, who acted as a placement agent. Refer to Note 12, Borrowings, for additional information. AFG Convertible Notes In January 2023, the Company issued and sold $13,750 of 26.5% Convertible Senior PIK Notes due in 2026 (“AFG Convertible Notes”) to Great American Insurance Company, Ardsley Partners Renewable Energy, LP, CCI SPV III, LP, Denman Street LLC, John B. Bending Irrevocable Children’s Trust, John B. Berding and AE Convert, LLC, a Delaware limited liability company managed by Russell Stidolph, a director of the Company (together, the “Purchasers”). In connection with the issuance and sale of the AFG Convertible Notes, the Company entered into an investment agreement (the “Investment Agreement”) with the Purchasers. Refer to Note 12, Borrowings, for additional information. Standby Equity Purchase Agreement On April 28, 2022, the Company entered into the Standby Equity Purchase Agreement (“SEPA”). Pursuant to the SEPA, the Company had the right, but not the obligation, to sell to Yorkville shares of its common stock at the Company’s request. On August 23, 2023, the Company and Yorkville terminated the SEPA, as amended, by mutual written consent. See Note 12, Borrowings for pre-advance loans in form of convertible promissory notes and Note 18, Shareholders' Deficit for additional information. Warrants The Company issued private placement warrants to B. Riley Financial, Inc. in conjunction with its initial public offering 2020 (“IPO warrants”). As of March 31, 2024 and December 31, 2023, 274,400 IPO warrants were outstanding for both periods, with a fair value of $49 and $55, respectively.

Borrowings

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Borrowings

The Company’s debt obligations at carrying value consist of the following related and third-party borrowings:


		March 31, 2024				December 31, 2023
	Maturity Date	Borrowing Outstanding		Carrying Value*		Borrowing Outstanding		Carrying Value*
2021 Convertible Note Payable	June 2026	$	115,815	$	96,033	$	115,815	$	94,386
Senior Secured Term Loan	March 2026	100,000		86,756		100,000		85,624
AFG Convertible Notes	June 2026	17,429		17,917		17,429		18,139
Equipment financing facility	April 2026	4,931		4,924		5,718		5,710
Total borrowings		238,175		205,630		238,962		203,859
Current portion		3,458		3,458		3,332		3,332
Total borrowings, non-current		$	234,717	$	202,172	$	235,630	$	200,527

*Carrying value includes unamortized deferred financing costs, unamortized discounts and fair value of embedded derivative liabilities.

2021 Convertible Note Payable – Related Party

Interest expense recognized on the 2021 Convertible Note is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,737	$	1,637
Amortization of debt discount	1,531		1,207
Amortization of debt issuance costs	148		117
Total	$	3,416	$	2,961

The balances for the 2021 Convertible Note are as follows:


	March 31, 2024		December 31, 2023
Principal	$	115,815	$	115,815
Unamortized debt discount	(18,081)		(19,612)
Unamortized debt issuance costs	(1,747)		(1,895)
Embedded conversion feature	46		78
Aggregate carrying value	$	96,033	$	94,386

AFG Convertible Notes - Related Party

Interest expense recognized on the AFG Convertible Notes is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,155	$	779
Amortization of debt discount	218		148
Amortization of debt issuance costs	62		42
Total	$	1,435	$	969

The balances for the AFG Convertible Notes are as follows:


	March 31, 2024		December 31, 2023
Principal	$	17,429	$	17,429
Unamortized debt discount	(2,617)		(2,835)
Unamortized debt issuance costs	(738)		(800)
Embedded conversion feature	3,843		4,345
Aggregate carrying value	$	17,917	$	18,139

Senior Secured Term Loan

The following table summarizes interest expense recognized:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	3,684	$	3,373
Amortization of debt discount	115		93
Amortization of debt issuance costs	1,017		822
Total	$	4,816	$	4,288

The Senior Secured Term Loan balance is as follows:


	March 31, 2024		December 31, 2023
Principal	$	100,000	$	100,000
Unamortized debt discount	(1,344)		(1,459)
Unamortized debt issuance costs	(11,900)		(12,917)
Aggregate carrying value	$	86,756	$	85,624

Equipment Financing facility


Date of Draw	Gross Amount of Initial Draw		Coupon Interest Rate	Debt Issuance Costs
September 2021	$	7,000	14.3%	$	175
September 2022	4,216		16.2%	96
Total Equipment Financing loans	$	11,216		$	271

Yorkville Convertible Promissory Notes - Related Party

As of December 31, 2023, there were no outstanding amounts under the Yorkville Promissory Notes.

Warrants Liability

3 Months Ended

Mar. 31, 2024

Other Liabilities Disclosure [Abstract]

Warrants Liability

The amount of warrants outstanding and fair value for all warrants as of March 31, 2024 and December 31, 2023 are as follows:


	March 31, 2024			December 31, 2023
	Warrants Outstanding	Fair Value		Warrants Outstanding	Fair Value
IPO warrants	274,400	$	49	274,400	$	55
April 2023 warrants	16,000,000	5,494		16,000,000	6,276
May 2023 warrants	3,601,980	1,357		3,601,980	1,544
December 2023 warrants	34,482,759	17,661		34,482,759	19,586
Total	54,359,139	$	24,561	54,359,139	$	27,461

Fair Value Measurement

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurement


	March 31, 2024						December 31, 2023
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Liabilities
Warrants	$	—	$	49	$	24,512	$	—	$	55	$	27,406
Embedded derivatives	$	—	$	—	$	3,889	$	—	$	—	$	4,423

Warrants Liabilities

The inputs used to determine the fair value of the April 2023 warrants, May 2023 warrants and the December 2023 warrants are as follows:


April 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.54 years			4.79 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

May 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.29 years			4.54 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

December 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.71 years			4.96 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

Embedded derivatives

The inputs used to determine the fair value of the embedded derivative liabilities are as follows:


2021 Convertible Note Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

AFG Convertible Notes Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

Level 3 Liabilities


	Three Months Ended March 31,
	2024		2023
Embedded derivatives
Balance at beginning of the period	$	4,423	$	1,945
Additions	—		14,799

Change in fair value of derivatives - related parties1	(534)		4,511
Balance at end of the period	$	3,889	$	21,255

Warrants
Balance at beginning of the period	$	27,406	$	—
Additions	—		—
Change in fair value of warrants	(2,894)		—
Balance at end of the period	$	24,512	$	—

1 Includes loss on debt extinguishment from Yorkville Promissory Note Conversions for the three months ended March 31, 2023.

The estimated fair value of financial instruments not carried at fair value in the Unaudited Condensed Consolidated Balance Sheets was as follows:


	Level in Fair Value Hierarchy	March 31, 2024				December 31, 2023
		Carrying Value		Fair Value		Carrying Value		Fair Value
Notes receivable	3	$	827	$	721	$	863	$	719
2021 Convertible Note*	3	96,033		63,034		94,386		57,998
Senior Secured Term Loan	3	86,756		64,117		85,624		61,360
AFG Convertible Notes*	3	17,917		19,076		18,139		18,352
Equipment financing facility	3	4,924		4,261		5,710		4,826
Total		$	206,457	$	151,209	$	204,722	$	143,255

*Includes the embedded derivative liabilities.

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Lease Commitments The Company has lease commitments under lease agreements. As of March 31, 2024, future lease payments amounted to $5,568. Minimum Volume Commitment In June 2022, the Company entered into a long-term supply agreement with a minimum volume commitment with a third party that provides services to process certain raw materials. Any purchase order issued under this supply agreement will be non-cancellable. If the Company fails to order the guaranteed minimum volume defined in the contract at the end of the term, the Company will be required to pay the counterparty an amount equal to the shortfall, if any, multiplied by a fee. The Company believes it will meet the minimum volume commitment and no shortfall penalty has been accrued as of March 31, 2024. Legal Proceedings Class Action Complaints

Stock-Based Compensation

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-based compensation expense included in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended March 31,
	2024		2023
Stock options	$	174	$	740
Restricted stock units	2,767		2,623
Total	$	2,941	$	3,363

The stock compensation expense has been recorded in cost of goods sold, research and development expenses and selling, general and administrative expenses.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes For the three months ended March 31, 2024 and 2023, income tax expense was $25 and $10, respectively, related to state margin taxes and taxable earnings from foreign operations. The income tax expense differs from the amount computed by applying the statutory U.S. federal income tax rate of 21% to the loss before income taxes. This is due to non-taxable income, foreign operations and pre-tax losses for which no tax benefit can be recognized for U.S. income tax purposes. The Company estimates and applies the annual effective tax rate to its ordinary earnings each interim period. Any significant unusual or infrequent items are not included in the estimation of the annual effective tax rate; instead, these items and their related income tax expense are separately stated in the interim period in which they occur. The quarterly estimate of the annual effective tax rate and related tax expense is subject to variation due to a multitude of factors, including, but are not limited to, the inability to accurately predict the Company’s pre-tax and taxable income and loss. At each balance sheet date, management assesses the likelihood that the Company will be able to realize its deferred tax assets. Management considered all available positive and negative evidence in assessing the need for a valuation allowance. The realization of deferred tax assets depends on the generation of sufficient taxable income of the appropriate character and in the appropriate taxing jurisdiction during the future periods in which the related temporary differences become deductible. Management has determined that it is unlikely that the Company will be able to utilize its U.S. deferred tax assets at March 31, 2024 and December 31, 2023 due to cumulative losses. Therefore, the Company has a valuation allowance against its net U.S. deferred tax assets. As of March 31, 2024 and December 31, 2023, the Company has unrecognized tax benefits associated with uncertain tax positions that, if recognized, would not affect the effective tax rate on income from continuing operations. The Company is not currently under examination by any taxing jurisdiction and none of the uncertain tax positions are expected to reverse within the next 12 months. The Company files income tax returns in U.S. federal and various state jurisdictions, as well as in Italy and India. The open tax years for federal returns are 2020 and forward and open tax years for state returns are generally 2019 and forward. In addition, net operating losses generated in closed years and utilized in open years are subject to adjustment by the tax authorities.

Shareholders’ Deficit

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Shareholders’ Deficit

Preferred Stock

Common Stock

Treasury Stock

Warrants Liability

Public Warrants

Standby Equity Purchase Agreement

At-the-Market Offering Program

Earnings Per Share

The following potentially dilutive shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:


	Three Months Ended March 31,
	2024	2023
Stock options and restricted stock units	9,048,602	6,987,945
Warrants	61,411,393	7,326,654
Convertible Notes	16,226,124	16,950,606

Subsequent Events	3 Months Ended
Subsequent Events	Mar. 31, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On April 22, 2024, the Company closed an agreement with Banyan Software, Inc. to accelerate its 2023 Production Tax Credit monetization. The Company received $2,303 in cash. This amount relates to a portion of the PTC grant receivable as of March 31, 2024, as discussed in Note 10, Government Grants.

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its 100% owned, direct and indirect subsidiaries and have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). All intercompany transactions and balances have been eliminated in the preparation of the Unaudited Condensed Consolidated Financial Statements. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The interim financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, included in our 2023 Annual Report on Form 10-K. These interim results are not necessarily indicative of results for the full year.
Use of Estimates	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 and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Reclassification of Prior Year Presentation	Reclassification of Prior Year Presentation Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.
Recent Accounting Pronouncements	Recent Accounting Pronouncements There were no new accounting standards or updates during the three months ended March 31, 2024 that would have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements.

Revenue Recognition (Tables)

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Revenue Recognition

Product revenues, which are generally recognized at a point in time, and service revenues, which are generally recognized over time, are as follows:


	For the Three Months Ended March 31,
	2024		2023
Product revenue	$	6,501	$	8,675
Service revenue	100		160
Total revenues	$	6,601	$	8,835

Schedule of Information about Contract Assets and Liabilities from Contracts with Customers


	March 31, 2024		December 31, 2023
Contract assets	$	12,894	$	8,322
Contract liabilities	$	7,111	$	6,610

Cash, Cash Equivalents and Restricted Cash (Tables)

3 Months Ended

Mar. 31, 2024

Cash and Cash Equivalents [Abstract]

Schedule of Cash, Cash Equivalents, and Restricted Cash


	March 31, 2024		March 31, 2023
Cash and cash equivalents	$	31,773	$	16,127
Restricted cash - current	2,625		2,725
Long-term restricted cash	11,858		11,450
Total cash, cash equivalents and restricted cash	$	46,256	$	30,302

Schedule of Cash, Cash Equivalents, and Restricted Cash


	March 31, 2024		March 31, 2023
Cash and cash equivalents	$	31,773	$	16,127
Restricted cash - current	2,625		2,725
Long-term restricted cash	11,858		11,450
Total cash, cash equivalents and restricted cash	$	46,256	$	30,302

Inventory (Tables)

3 Months Ended

Mar. 31, 2024

Inventory Disclosure [Abstract]

Schedule of Components of Inventories

The following table provides information about inventory balances:


	March 31, 2024		December 31, 2023
Raw materials	$	13,045	$	15,487
Work-in-process	490		1,105
Finished goods	858		478
Total inventory, net	$	14,393	$	17,070

Property, Plant and Equipment, Net (Tables)

3 Months Ended

Mar. 31, 2024

Property, Plant and Equipment [Abstract]

Schedule of Components of Property, Plant and Equipment, Net

The following table provides information about property, plant and equipment, net balances:


	Estimated Useful lives	March 31, 2024		December 31, 2023
Equipment	5 to 10 years	$	22,484	$	20,559
Finance lease	5 years	504		504
Furniture	5 to 10 years	2,179		2,103
Leasehold improvements	Lesser of useful life/ remaining lease	7,951		7,718
Tooling	2 to 3 years	7,866		7,045
Construction in progress (“CIP”)		20,819		17,958
Total		61,803		55,887
Less: Accumulated depreciation		(19,061)		(18,032)
Total property, plant and equipment, net		$	42,742	$	37,855

Accrued Expenses (Tables)

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses were as follows:


	March 31, 2024		December 31, 2023
Accrued payroll	$	7,273	$	4,553
Warranty reserve (1)	5,513		6,197
Accrued legal and professional expenses	11,058		10,710
Provision for contract losses	3,205		3,351
Insurance premium payable, current	2,730		2,605
Interest payable, current	3,684		—
Other	5,151		4,916
Total accrued expenses	$	38,614	$	32,332

(1) Refer to the table below for the warranty reserve activity for the three months ended March 31, 2024 and 2023.

Schedule of Warranty Reserve Activity

The following table summarizes warranty reserve activity:


	Three Months Ended March 31,
	2024		2023
Warranty reserve - beginning of period	$	6,197	$	3,836
Additions for current period deliveries	265		357
Changes in the warranty reserve estimate	(949)		—
Warranty costs incurred	—		(221)
Warranty reserve - end of period	$	5,513	$	3,972

Borrowings (Tables)

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Schedule of Debt

The Company’s debt obligations at carrying value consist of the following related and third-party borrowings:


		March 31, 2024				December 31, 2023
	Maturity Date	Borrowing Outstanding		Carrying Value*		Borrowing Outstanding		Carrying Value*
2021 Convertible Note Payable	June 2026	$	115,815	$	96,033	$	115,815	$	94,386
Senior Secured Term Loan	March 2026	100,000		86,756		100,000		85,624
AFG Convertible Notes	June 2026	17,429		17,917		17,429		18,139
Equipment financing facility	April 2026	4,931		4,924		5,718		5,710
Total borrowings		238,175		205,630		238,962		203,859
Current portion		3,458		3,458		3,332		3,332
Total borrowings, non-current		$	234,717	$	202,172	$	235,630	$	200,527

*Carrying value includes unamortized deferred financing costs, unamortized discounts and fair value of embedded derivative liabilities.

The Senior Secured Term Loan balance is as follows:


	March 31, 2024		December 31, 2023
Principal	$	100,000	$	100,000
Unamortized debt discount	(1,344)		(1,459)
Unamortized debt issuance costs	(11,900)		(12,917)
Aggregate carrying value	$	86,756	$	85,624


Date of Draw	Gross Amount of Initial Draw		Coupon Interest Rate	Debt Issuance Costs
September 2021	$	7,000	14.3%	$	175
September 2022	4,216		16.2%	96
Total Equipment Financing loans	$	11,216		$	271

Schedule of Interest Expense

Interest expense recognized on the 2021 Convertible Note is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,737	$	1,637
Amortization of debt discount	1,531		1,207
Amortization of debt issuance costs	148		117
Total	$	3,416	$	2,961

Interest expense recognized on the AFG Convertible Notes is as follows:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	1,155	$	779
Amortization of debt discount	218		148
Amortization of debt issuance costs	62		42
Total	$	1,435	$	969

The following table summarizes interest expense recognized:


	Three Months Ended March 31,
	2024		2023
Contractual interest expense	$	3,684	$	3,373
Amortization of debt discount	115		93
Amortization of debt issuance costs	1,017		822
Total	$	4,816	$	4,288

Schedule of Balances Recognized upon Issuance of Convertible Notes

The balances for the 2021 Convertible Note are as follows:


	March 31, 2024		December 31, 2023
Principal	$	115,815	$	115,815
Unamortized debt discount	(18,081)		(19,612)
Unamortized debt issuance costs	(1,747)		(1,895)
Embedded conversion feature	46		78
Aggregate carrying value	$	96,033	$	94,386

The balances for the AFG Convertible Notes are as follows:


	March 31, 2024		December 31, 2023
Principal	$	17,429	$	17,429
Unamortized debt discount	(2,617)		(2,835)
Unamortized debt issuance costs	(738)		(800)
Embedded conversion feature	3,843		4,345
Aggregate carrying value	$	17,917	$	18,139

Warrants Liability (Tables)

3 Months Ended

Mar. 31, 2024

Other Liabilities Disclosure [Abstract]

Schedule of Common Stock Warrants Outstanding and Fair Value

The amount of warrants outstanding and fair value for all warrants as of March 31, 2024 and December 31, 2023 are as follows:


	March 31, 2024			December 31, 2023
	Warrants Outstanding	Fair Value		Warrants Outstanding	Fair Value
IPO warrants	274,400	$	49	274,400	$	55
April 2023 warrants	16,000,000	5,494		16,000,000	6,276
May 2023 warrants	3,601,980	1,357		3,601,980	1,544
December 2023 warrants	34,482,759	17,661		34,482,759	19,586
Total	54,359,139	$	24,561	54,359,139	$	27,461

Fair Value Measurement (Tables)

3 Months Ended

Mar. 31, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value of Liabilities


	March 31, 2024						December 31, 2023
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Liabilities
Warrants	$	—	$	49	$	24,512	$	—	$	55	$	27,406
Embedded derivatives	$	—	$	—	$	3,889	$	—	$	—	$	4,423

Schedule of Assumptions used to Determine Fair Value of Warrants and Embedded Derivative Liabilities

The inputs used to determine the fair value of the April 2023 warrants, May 2023 warrants and the December 2023 warrants are as follows:


April 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.54 years			4.79 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

May 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.29 years			4.54 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

December 2023 warrants	March 31, 2024			December 31, 2023
Time to expiration	4.71 years			4.96 years
Common stock price	$	1.03		$	1.09
Risk-free interest rate	4.2		%	3.8		%
Volatility	70.0		%	70.0		%

The inputs used to determine the fair value of the embedded derivative liabilities are as follows:


2021 Convertible Note Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

AFG Convertible Notes Payable	March 31, 2024		December 31, 2023
Term	2.25 years		2.5 years
Dividend yield	—	%	—	%
Risk-free interest rate	4.5	%	4.1	%
Volatility	70.0	%	70.0	%
Effective debt yield	40.0	%	40.0	%

Schedule of Liabilities Measured at Fair Value

The following table summarizes the changes in the fair value of liabilities that are included within the Company’s accompanying Unaudited Condensed Consolidated Balance Sheets and are designated as Level 3:


	Three Months Ended March 31,
	2024		2023
Embedded derivatives
Balance at beginning of the period	$	4,423	$	1,945
Additions	—		14,799

Change in fair value of derivatives - related parties1	(534)		4,511
Balance at end of the period	$	3,889	$	21,255

Warrants
Balance at beginning of the period	$	27,406	$	—
Additions	—		—
Change in fair value of warrants	(2,894)		—
Balance at end of the period	$	24,512	$	—

1 Includes loss on debt extinguishment from Yorkville Promissory Note Conversions for the three months ended March 31, 2023.

Schedule of Estimated Fair Value of Financial Instruments Not Carried at Fair Value

The estimated fair value of financial instruments not carried at fair value in the Unaudited Condensed Consolidated Balance Sheets was as follows:


	Level in Fair Value Hierarchy	March 31, 2024				December 31, 2023
		Carrying Value		Fair Value		Carrying Value		Fair Value
Notes receivable	3	$	827	$	721	$	863	$	719
2021 Convertible Note*	3	96,033		63,034		94,386		57,998
Senior Secured Term Loan	3	86,756		64,117		85,624		61,360
AFG Convertible Notes*	3	17,917		19,076		18,139		18,352
Equipment financing facility	3	4,924		4,261		5,710		4,826
Total		$	206,457	$	151,209	$	204,722	$	143,255

*Includes the embedded derivative liabilities.

Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Stock-based Compensation Expense

Stock-based compensation expense included in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss was as follows:


	Three Months Ended March 31,
	2024		2023
Stock options	$	174	$	740
Restricted stock units	2,767		2,623
Total	$	2,941	$	3,363

Shareholders’ Deficit (Tables)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Schedule of Anti-Dilutive Shares Excluded From Diluted Net Loss Per Share

The following potentially dilutive shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented:


	Three Months Ended March 31,
	2024	2023
Stock options and restricted stock units	9,048,602	6,987,945
Warrants	61,411,393	7,326,654
Convertible Notes	16,226,124	16,950,606

Overview (Details) $ in Thousands	3 Months Ended
Overview (Details) $ in Thousands	Mar. 31, 2024 USD ($) segment	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($)	Aug. 31, 2023 USD ($)
Line of Credit Facility [Line Items]
Number of operating segments \| segment	1
Number of reportable segments \| segment	1
Net loss	$ 46,708	$ 71,600
Net cash used in operating activities	40,474	30,478
Accumulated deficit	922,554		$ 875,846
Cash and cash equivalents	31,773	$ 16,127	$ 69,473
Working capital	22,097
Outstanding debt	$ 3,458
DOE Clean Energy Financing Program \| Notes Payable
Line of Credit Facility [Line Items]
Aggregate principal amount				$ 398,600

Summary of Significant Accounting Policies (Details)	3 Months Ended
Summary of Significant Accounting Policies (Details)	Mar. 31, 2024
Accounting Policies [Abstract]
Equity interest ownership percentage	100.00%

Revenue Recognition - Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation of Revenue [Line Items]
Total revenue	$ 6,601	$ 8,835
Product revenue
Disaggregation of Revenue [Line Items]
Total revenue	6,501	8,675
Service revenue
Disaggregation of Revenue [Line Items]
Total revenue	$ 100	$ 160

Revenue Recognition - Narratives (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Sales-type lease, term of contract	20 years
Sales-type lease, revenue	$ 0	$ 0
Increase (decrease) in contract asset	4,572	1,914
Increase (decrease) in contract liabilities	501	$ (3,450)
Revenue recognized in contract liabilities	798
Increase from customer advance payments	1,299
Contract liabilities, current	2,828		$ 3,070
Contract liabilities, long-term	4,283		$ 3,540
Contract assets, current	11,075
Contract assets, long-term	$ 1,819
Revenue Benchmark \| Customer 1 \| Customer Concentration Risk
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Concentration risk percentage	88.10%	97.00%

Revenue Recognition - Information about Contract Liabilities from Contracts with Customers (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Revenue from Contract with Customer [Abstract]
Contract assets	$ 12,894	$ 8,322
Contract liabilities	$ 7,111	$ 6,610

Cash, Cash Equivalents and Restricted Cash - Narrative (Details)	Jul. 29, 2022 interest_payment
Senior Secured Term Loan \| Secured Debt
Restricted Cash and Cash Equivalents Items [Line Items]
Number of immediately following interest payments required to be escrowed	4

Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 31,773	$ 69,473	$ 16,127
Restricted cash - current	2,625	3,439	2,725
Long-term restricted cash	11,858	11,755	11,450
Total cash, cash equivalents and restricted cash	$ 46,256	$ 84,667	$ 30,302	$ 31,223

Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 13,045	$ 15,487
Work-in-process	490	1,105
Finished goods	858	478
Total inventory, net	$ 14,393	$ 17,070

Property, Plant and Equipment, Net - Components of Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 61,803	$ 55,887
Less: Accumulated depreciation	(19,061)	(18,032)
Total property, plant and equipment, net	42,742	37,855
Equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 22,484	20,559
Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	5 years
Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	10 years
Finance lease
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 504	504
Estimated Useful lives	5 years
Furniture
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 2,179	2,103
Furniture \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	5 years
Furniture \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	10 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 7,951	7,718
Tooling
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 7,866	7,045
Tooling \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	2 years
Tooling \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful lives	3 years
Construction in progress (“CIP”)
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 20,819	$ 17,958

Property, Plant and Equipment, Net - Narratives (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense related to property and equipment	$ 1,175	$ 2,667
Loss from write-down of property, plant and equipment	65	760
Interest costs	$ 850	$ 0

Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
Intangible Assets (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Capitalized cost	$ 146
Additional capitalized cost	8
Amortization of capitalized computer software cost	12	$ 9
Patents
Finite-Lived Intangible Assets [Line Items]
Gross patents value	$ 400
Patents useful lives	10 years
Patents amortization expenses	$ 10	$ 10
Software
Finite-Lived Intangible Assets [Line Items]
Patents useful lives		3 years

Notes Receivable, Net and Variable Interest Entities (“VIEs”) Consideration (Details) - Variable Interest Entity, not primary beneficiary - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Variable Interest Entity [Line Items]
Loan commitment on the consolidated balance sheet	$ 827	$ 863
Financing receivable, allowance for credit loss	$ 36	$ 2

Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Accrued payroll	$ 7,273	$ 4,553
Warranty reserve	5,513	6,197
Accrued legal and professional expenses	11,058	10,710
Provision for contract losses	3,205	3,351
Insurance premium payable, current	2,730	2,605
Interest payable, current	3,684	0
Other	5,151	4,916
Total accrued expenses	$ 38,614	$ 32,332

Accrued Expenses - Warranty Reserve Activity (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Movement in Standard Product Warranty Accrual [Roll Forward]
Warranty reserve - beginning of period	$ 6,197	$ 3,836
Additions for current period deliveries	265	357
Changes in the warranty reserve estimate	(949)	0
Warranty costs incurred	0	(221)
Warranty reserve - end of period	$ 5,513	$ 3,972

Government Grants (Details) - Production Tax Credits - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Government Assistance [Line Items]
Government assistance amount	$ 1,542	$ 798
Current grants receivable	$ 4,798		$ 3,256

Related Party Transactions (Details) - USD ($)	1 Months Ended	3 Months Ended
Related Party Transactions (Details) - USD ($)	Jul. 31, 2021	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Jan. 31, 2023	Jan. 18, 2023	Jul. 06, 2021
Related Party Transaction [Line Items]
Warrants outstanding (in shares)		54,359,139		54,359,139
Warrants liability		$ 24,561,000		$ 27,461,000
2021 Convertible Note Payable \| Convertible Notes
Related Party Transaction [Line Items]
Principal							$ 100,000,000
Related Party
Related Party Transaction [Line Items]
Payment made for debt issuance cost		$ 0	$ 1,116,000
Related Party \| IPO warrants \| Common Stock
Related Party Transaction [Line Items]
Warrants outstanding (in shares)		274,400		274,400
Warrants liability		$ 49,000		$ 55,000
Related Party \| 2021 Convertible Note Payable
Related Party Transaction [Line Items]
Notes payable	$ 100,000,000
Payment made for debt issuance cost	$ 3,000,000
Related Party \| AFG Convertible Notes Payable \| Convertible Notes
Related Party Transaction [Line Items]
Principal					$ 13,750,000	$ 13,750,000
Paid-in-kind interest rate		26.50%			26.50%

Borrowings - Schedule of Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Borrowing Outstanding
Total borrowings	$ 238,175	$ 238,962
Current portion	3,458	3,332
Total borrowings, non-current	234,717	235,630
Carrying Value*
Total borrowings	205,630	203,859
Current portion	3,458	3,332
Total borrowings, non-current	202,172	200,527
2021 Convertible Note Payable \| Convertible Notes
Borrowing Outstanding
Total borrowings	115,815	115,815
Carrying Value*
Total borrowings	96,033	94,386
Senior Secured Term Loan
Carrying Value*
Total borrowings	86,756	85,624
Senior Secured Term Loan \| Secured Debt
Borrowing Outstanding
Total borrowings	100,000	100,000
Carrying Value*
Total borrowings	86,756	85,624
AFG Convertible Notes \| Convertible Notes
Borrowing Outstanding
Total borrowings	17,429	17,429
Carrying Value*
Total borrowings	17,917	18,139
Equipment financing facility
Carrying Value*
Total borrowings	4,924	5,710
Equipment financing facility \| Line of Credit
Borrowing Outstanding
Total borrowings	4,931	5,718
Carrying Value*
Total borrowings	$ 4,924	$ 5,710

Borrowings - Narrative (Details) - USD ($)		3 Months Ended		4 Months Ended
Borrowings - Narrative (Details) - USD ($)	Jul. 29, 2022	Mar. 31, 2024	Mar. 31, 2023	Mar. 31, 2023	Dec. 31, 2023	Jan. 31, 2023	Jan. 18, 2023	Sep. 30, 2022	Sep. 30, 2021	Jul. 06, 2021
Debt Instrument [Line Items]
Interest payable		$ 2,892,000			$ 0
Common stock, par value (in dollars per share)		$ 0.0001			$ 0.0001
Carrying Value		$ 205,630,000			$ 203,859,000
Long-term debt, current		3,458,000			3,332,000
Proceeds from issuance of convertible notes - related party		0	$ 33,350,000
Loss on debt extinguishment		0	1,634,000
Change in fair value of derivatives - related parties		534,000	(12,934,000)
Related Party
Debt Instrument [Line Items]
Change in fair value of derivatives - related parties		534,000	(12,934,000)
2021 Convertible Note Payable \| Related Party
Debt Instrument [Line Items]
Interest payable		1,737,000			0
2021 Convertible Note Payable \| Convertible Notes
Debt Instrument [Line Items]
Principal										$ 100,000,000
Embedded conversion feature		46,000			78,000
Carrying Value		96,033,000			$ 94,386,000
Non-cash interest expense - related party		$ 3,416,000	2,961,000
Coupon Interest Rate		40.00%			40.00%
Amortization of debt discount		$ 1,531,000	1,207,000
AFG Convertible Notes Payable \| Related Party
Debt Instrument [Line Items]
Interest payable		$ 1,155,000			$ 0
Carrying Value							$ 16,623,000
Non-cash interest expense - related party			2,873,000
AFG Convertible Notes Payable \| Convertible Notes
Debt Instrument [Line Items]
Common stock, par value (in dollars per share)							$ 0.0001
Conversion price per unit (in dollars per share)							$ 1.67
Coupon Interest Rate		40.00%			40.00%
AFG Convertible Notes Payable \| Convertible Notes \| Related Party
Debt Instrument [Line Items]
Principal						$ 13,750,000	$ 13,750,000
Paid-in-kind interest rate		26.50%				26.50%
Embedded conversion feature		$ 3,843,000			$ 4,345,000
Carrying Value		17,917,000			18,139,000
Non-cash interest expense - related party		1,435,000	969,000
Amortization of debt discount		218,000	148,000
Senior Secured Term Loan
Debt Instrument [Line Items]
Carrying Value		86,756,000			85,624,000
Senior Secured Term Loan \| SOFR \| Minimum
Debt Instrument [Line Items]
Variable rate spread	0.2616%
Senior Secured Term Loan \| NYFRB \| Minimum
Debt Instrument [Line Items]
Variable rate spread	0.50%
Senior Secured Term Loan \| Secured Debt
Debt Instrument [Line Items]
Principal	$ 100,000,000
Carrying Value		86,756,000			85,624,000
Number of days prior to current maturity date	91 days
Minimum prepayment amount	$ 500,000,000
Repayment applicable treasury rate	0.50%
Interest escrowed for loan		$ 11,858,000			11,755,000
Senior Secured Term Loan \| SOFR Loans
Debt Instrument [Line Items]
Variable rate spread	8.50%
Coupon Interest Rate		14.11%
Senior Secured Term Loan \| ABR Loans
Debt Instrument [Line Items]
Stated interest rate	7.50%
Equipment financing facility
Debt Instrument [Line Items]
Carrying Value		$ 4,924,000			5,710,000
Non-cash interest expense - related party		208,000	317,000
Long-term line of credit		4,924,000			5,710,000
Long-term debt, current		3,458,000			3,332,000
Equipment financing facility \| Line of Credit
Debt Instrument [Line Items]
Carrying Value		$ 4,924,000			$ 5,710,000
Coupon Interest Rate								16.20%	14.30%
Maximum borrowing capacity									$ 25,000,000
Yorkville Convertible Promissory Note \| Convertible Notes \| Related Party
Debt Instrument [Line Items]
Proceeds from issuance of convertible notes - related party				$ 22,000,000
Amortization of debt discount			$ 6,952,000
Converted instrument, shares issued (in shares)			11,216,492
Embedded Derivatives - Yorkville Convertible Promissory Notes \| Convertible Notes
Debt Instrument [Line Items]
Change in fair value of derivatives - related parties			$ 55,000

Borrowings - Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
2021 Convertible Note Payable \| Convertible Notes
Debt Instrument [Line Items]
Contractual interest expense	$ 1,737	$ 1,637
Amortization of debt discount	1,531	1,207
Amortization of debt issuance costs	148	117
Total	3,416	2,961
AFG Convertible Notes \| Related Party
Debt Instrument [Line Items]
Total		2,873
AFG Convertible Notes \| Convertible Notes \| Related Party
Debt Instrument [Line Items]
Contractual interest expense	1,155	779
Amortization of debt discount	218	148
Amortization of debt issuance costs	62	42
Total	1,435	969
Senior Secured Term Loan \| Secured Debt \| Nonrelated Party
Debt Instrument [Line Items]
Contractual interest expense	3,684	3,373
Amortization of debt discount	115	93
Amortization of debt issuance costs	1,017	822
Total	$ 4,816	$ 4,288

Borrowings - Net Carrying Value (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Jan. 18, 2023
Debt Instrument [Line Items]
Principal	$ 238,175	$ 238,962
Total borrowings	205,630	203,859
2021 Convertible Note Payable \| Convertible Notes
Debt Instrument [Line Items]
Principal	115,815	115,815
Unamortized debt discount	(18,081)	(19,612)
Unamortized debt issuance costs	(1,747)	(1,895)
Embedded conversion feature	46	78
Total borrowings	96,033	94,386
AFG Convertible Notes Payable \| Related Party
Debt Instrument [Line Items]
Total borrowings			$ 16,623
AFG Convertible Notes Payable \| Convertible Notes \| Related Party
Debt Instrument [Line Items]
Principal	17,429	17,429
Unamortized debt discount	(2,617)	(2,835)
Unamortized debt issuance costs	(738)	(800)
Embedded conversion feature	3,843	4,345
Total borrowings	17,917	18,139
Senior Secured Term Loan
Debt Instrument [Line Items]
Total borrowings	86,756	85,624
Senior Secured Term Loan \| Secured Debt
Debt Instrument [Line Items]
Principal	100,000	100,000
Total borrowings	86,756	85,624
Senior Secured Term Loan \| Secured Debt \| Nonrelated Party
Debt Instrument [Line Items]
Principal	100,000	100,000
Unamortized debt discount	(1,344)	(1,459)
Unamortized debt issuance costs	(11,900)	(12,917)
Total borrowings	$ 86,756	$ 85,624

Borrowings - Equipment Financing Facility (Details) - Line of Credit - Equipment financing facility - USD ($) $ in Thousands	1 Months Ended		31 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Mar. 31, 2024
Debt Instrument [Line Items]
Gross Amount of Initial Draw	$ 4,216	$ 7,000	$ 11,216
Coupon Interest Rate	16.20%	14.30%
Debt Issuance Costs	$ 96	$ 175	$ 271

Warrants Liability - Narrative (Details) - shares	1 Months Ended			3 Months Ended
Warrants Liability - Narrative (Details) - shares	Dec. 31, 2023	May 31, 2023	Apr. 30, 2023	Mar. 31, 2024	Mar. 31, 2023	May 22, 2020
Class of Warrant or Right [Line Items]
Common stock to be purchased through warrants (in shares)						9,075,000
Common Stock
Class of Warrant or Right [Line Items]
Issuance of common stock (in shares)				7,239,982	11,900,400
Related Party \| Common Stock \| April 2023 warrants
Class of Warrant or Right [Line Items]
Issuance of common stock (in shares)			16,000,000
Common stock to be purchased through warrants (in shares)			16,000,000
Related Party \| Common Stock \| May 2023 warrants
Class of Warrant or Right [Line Items]
Issuance of common stock (in shares)		3,601,980
Common stock to be purchased through warrants (in shares)		3,601,980
Related Party \| Common Stock \| December 2023 warrants
Class of Warrant or Right [Line Items]
Issuance of common stock (in shares)	34,482,759

Warrants Liability - Schedule of Common Stock Warrants Outstanding and Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	54,359,139	54,359,139
Fair Value	$ 24,561	$ 27,461
IPO warrants \| Related Party \| Common Stock
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	274,400	274,400
Fair Value	$ 49	$ 55
April 2023 warrants \| Related Party \| Common Stock
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	16,000,000	16,000,000
Fair Value	$ 5,494	$ 6,276
May 2023 warrants \| Related Party \| Common Stock
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	3,601,980	3,601,980
Fair Value	$ 1,357	$ 1,544
December 2023 warrants \| Related Party \| Common Stock
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	34,482,759	34,482,759
Fair Value	$ 17,661	$ 19,586

Fair Value Measurement - Fair Value of Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants	$ 24,561	$ 27,461
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants	0	0
Level 1 \| Embedded derivatives
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Embedded derivatives	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants	49	55
Level 2 \| Embedded derivatives
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Embedded derivatives	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants	24,512	27,406
Level 3 \| Embedded derivatives
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Embedded derivatives	$ 3,889	$ 4,423

Fair Value Measurement - Assumptions used to determine Fair Value of Warrants (Details)	Mar. 31, 2024 $ / shares	Dec. 31, 2023 $ / shares
Time to expiration \| April 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Time to expiration	4 years 6 months 14 days	4 years 9 months 14 days
Time to expiration \| May 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Time to expiration	4 years 3 months 14 days	4 years 6 months 14 days
Time to expiration \| December 2023 Private Warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Time to expiration	4 years 8 months 15 days	4 years 11 months 15 days
Common stock price \| April 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	1.03	1.09
Common stock price \| May 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	1.03	1.09
Common stock price \| December 2023 Private Warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	1.03	1.09
Risk-free interest rate \| April 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.042	0.038
Risk-free interest rate \| May 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.042	0.038
Risk-free interest rate \| December 2023 Private Warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.042	0.038
Volatility \| April 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.700	0.700
Volatility \| May 2023 warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.700	0.700
Volatility \| December 2023 Private Warrants
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Warrants and rights outstanding, measurement input	0.700	0.700

Fair Value Measurement - Assumptions used to determine Fair Value of Embedded Derivative Liabilities (Details) - Convertible Notes	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023
2021 Convertible Note Payable
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Term	2 years 3 months	2 years 6 months
Effective debt yield	40.00%	40.00%
2021 Convertible Note Payable \| Dividend yield
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0	0
2021 Convertible Note Payable \| Risk-free interest rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0.045	0.041
2021 Convertible Note Payable \| Volatility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0.700	0.700
AFG Convertible Notes Payable
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Term	2 years 3 months	2 years 6 months
Effective debt yield	40.00%	40.00%
AFG Convertible Notes Payable \| Dividend yield
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0	0
AFG Convertible Notes Payable \| Risk-free interest rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0.045	0.041
AFG Convertible Notes Payable \| Volatility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value, measurement input	0.700	0.700

Fair Value Measurement - Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Warrants
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of the period	$ 27,406	$ 0
Additions	0	0
Change in fair value of derivatives and warrants	(2,894)	0
Balance at end of the period	24,512	0
Embedded derivatives
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of the period	4,423	1,945
Additions	0	14,799
Change in fair value of derivatives and warrants	(534)	4,511
Balance at end of the period	$ 3,889	$ 21,255

Fair Value Measurement - Estimated Fair Value of Financial Instruments Not Carried at Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	$ 205,630	$ 203,859
Carrying Value	206,457	204,722
Notes receivable
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	827	863
2021 Convertible Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	96,033	94,386
Senior Secured Term Loan
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	86,756	85,624
AFG Convertible Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	17,917	18,139
Equipment financing facility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	4,924	5,710
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	151,209	143,255
Level 3 \| Notes receivable
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	721	719
Level 3 \| 2021 Convertible Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	63,034	57,998
Level 3 \| Senior Secured Term Loan
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	64,117	61,360
Level 3 \| AFG Convertible Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	19,076	18,352
Level 3 \| Equipment financing facility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair Value	$ 4,261	$ 4,826

Commitments and Contingencies (Details) - USD ($) $ in Thousands	Feb. 01, 2024	Jan. 31, 2024	Mar. 31, 2024
Commitments and Contingencies Disclosure [Abstract]
Future lease payments			$ 5,568
Settlement, amount awarded to other party	$ 8,500
Payments for legal settlements		$ 1,000
Litigation settlement amount funded by liability insurance policies	$ 7,500

Stock-Based Compensation - Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense	$ 2,941	$ 3,363
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense	174	740
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense	$ 2,767	$ 2,623

Stock-Based Compensation - Narratives (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock compensation expense	$ 12,448
Unrecognized stock compensation expense attributable to stock option	90
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized stock compensation expense attributable to RSUs	$ 12,358
Vesting term	2 years 1 month 6 days
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting term	1 month 6 days

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Income Tax Disclosure [Abstract]
Income tax expense	$ 25	$ 10

Shareholders’ Deficit - Narrative (Details)	3 Months Ended
Shareholders’ Deficit - Narrative (Details)	Mar. 31, 2024 USD ($) vote $ / shares shares	Mar. 31, 2023 USD ($) shares	Dec. 31, 2023 $ / shares shares	Dec. 31, 2022 shares	May 22, 2020 $ / shares shares
Class of Stock [Line Items]
Preferred stock, shares authorized (in shares)	1,000,000		1,000,000
Preferred stock, shares issued (in shares)	0		0
Preferred stock, shares outstanding (in shares)	0		0
Common stock, shares authorized (in shares)	300,000,000		300,000,000
Common stock, par value (in dollars per share) \| $ / shares	$ 0.0001		$ 0.0001
Number of votes for each share \| vote	1
Common stock, shares issued (in shares)	206,779,447		199,133,827
Common stock, shares outstanding (in shares)	206,779,447		199,133,827
Cancellation of shares used to settle payroll tax withholding \| $	$ 308,000	$ 345,000
Common stock to be purchased through warrants (in shares)					9,075,000
Price of common stock to be purchased through warrants (in dollars per share) \| $ / shares					$ 11.50
Warrants outstanding (in shares)	54,359,139		54,359,139
Public Warrants
Class of Stock [Line Items]
Warrants outstanding (in shares)	7,052,254		7,052,254
Private Placement
Class of Stock [Line Items]
Proceeds from sale of treasury stock \| $		$ 20,850,000
Sale of stock, number of shares issued in transaction (in shares)		11,900,400
ATM
Class of Stock [Line Items]
Sale of stock, number of shares issued in transaction (in shares)	7,239,982	0
Authorized value of stock to be sold \| $	$ 200,000
Cash received on issuance of shares \| $	$ 7,206,000
Sale of stock, price per share (in dollars per share) \| $ / shares	$ 1.03
Common Stock
Class of Stock [Line Items]
Common stock, shares outstanding (in shares)	206,779,447	95,222,670	199,133,827	82,653,781
Exercise of warrants (in shares)	0	0

Shareholders’ Deficit - Potentially Dilutive Shares Excluded from Calculation of Diluted Net Loss Per Share (Details) - shares	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Stock options and restricted stock units
Class of Stock [Line Items]
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares)	9,048,602	6,987,945
Warrants
Class of Stock [Line Items]
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares)	61,411,393	7,326,654
Convertible Notes
Class of Stock [Line Items]
Anti-dilutive securities excluded from calculation of diluted net loss per share (in shares)	16,226,124	16,950,606

Subsequent Events (Details) - USD ($) $ in Thousands	Apr. 22, 2024	Mar. 31, 2024	Dec. 31, 2023
Subsequent Event [Line Items]
Grant receivable		$ 4,798	$ 3,256
Subsequent event \| Production Tax Credits
Subsequent Event [Line Items]
Grant receivable	$ 2,303

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