Eos Energy Enterprises, Inc.

Previous wording

The following discussion should be read in conjunction with the accompanying Unaudited Condensed Consolidated Financial Statements for the nine months ended September 30, 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.

Current wording

The following discussion should be read in conjunction with the accompanying Unaudited Condensed Consolidated Financial Statements for the three months ended March 31, 2025 and 2024 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, including the financial statements and notes thereto.

Previous wording

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.

Current wording

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 utilizes 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.

Previous wording

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.

Current wording

In addition to its BESS, the Company currently offers: (a) a Battery Management System (“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.

Previous wording

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.

Current wording

The Company believes that the simplicity, flexibility, and safety of its products are key attributes desired by the market. Moreover, the Company recognizes the competitive advantage offered by the Inflation Reduction Act, which provides production tax credits (PTC) for domestically manufactured battery components, as well as tax credits for customers involved in projects meeting domestic content requirements. The Company also plans to collaborate with a consortium of community leaders, universities, and supply chain partners to pursue funding opportunities under the Bipartisan Infrastructure Law of 2021.

Previous wording

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.

Current wording

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. 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, which include our Gen 2.3 and Z3™ BESS, could qualify for an investment tax credit (“ITC”). In December 2024, the IRS and U.S. Department of the Treasury published final regulations that clarified certain investment tax credit eligibility requirements for Section 48 energy investment tax credits that were enacted as part of the IRA. The IRA 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. 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 believe that projects utilizing Eos batteries qualify for the bonus and meet safe harbor requirements. The Company is observing accelerated customer activity in 2025 as customers seek to commence construction and incur qualifying costs prior to the end of 2025 in order to secure eligibility for the current ITC safe harbor provisions, before fully transitioning to the technology-neutral Section 48E framework effective for projects initiated thereafter.

Previous wording

As discussed in Note 11, 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.

Current wording

Production Tax Credits under Internal Revenue Code 45X (“PTC”) 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. In April 2024, the IRS issued final 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.

Previous wording

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

Current wording

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

Previous wording

The Company incurred a loss of $3.2 million and $1.0 million from write-down of property, plant and equipment for the three months ended September 30, 2024 and 2023, respectively, and a loss of $3.5 million and $7.2 million for the nine months ended September 30, 2024 and 2023, respectively. The 2023 write-downs were 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. The 2024 write-downs were primarily related to design changes from the Z3™-Phase 1 to Z3™-Phase 2 production in which the Phase 1 production assets could not be utilized or repurposed for Phase 2 production.

Current wording

The Company incurred a loss of $0.6 million and $0.1 million from write-down of property, plant and equipment for the three months ended March 31, 2025 and 2024, respectively. The write-downs were mainly due to design changes from the Z3™-Phase 1 to Z3™-Phase 2 production in which the Phase 1 production assets could not be utilized or repurposed for Phase 2 production. Additionally, the loss from write-down of property, plant and equipment contains costs for disposal of miscellaneous equipment and tooling that cannot be repurposed for more automated processes.

Previous wording

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. For the three and nine months ended September 30, 2024, Interest expense, net decreased $4.9 million and $6.8 million, respectively, mainly due to lower interest expense recognized from the Senior Secured Term Loan.

Current wording

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. For the three months ended March 31, 2025, Interest expense, net decreased $4.1 million, mainly due to lower interest expense recognized from the Senior Secured Term Loan due to the payoff of the Atlas Credit Facility in 2024.

Previous wording

The change in the fair value of debt - related party of $3.0 million and $3.3 million for the three and nine months ended September 30, 2024, respectively, relates to the Delayed Draw Term Loan.

Current wording

The change in the fair value of debt - related party of $5.9 million for the three months ended March 31, 2025, relates to the Delayed Draw Term Loan.

Previous wording

For the three and nine months ended September 30, 2024, compared to the three and nine months ended September 30, 2023, Other (expense) income increased by $2.0 million and $4.3 million, respectively, primarily due to recognition of financing issuance costs from the Credit and Securities Purchase Transaction.

Current wording

For the three months ended March 31, 2025, compared to the three months ended March 31, 2024, Other (expense) income increased by $0.7 million, respectively, primarily due to recognition of financing issuance costs from the Credit and Securities Purchase Transaction.

Previous wording

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. While the Company believes its recent entry into new credit facilities as discussed below has significantly improved its capital position and provides a path to sustainable operations and profitability, there can be no assurance the Company will be able to achieve such profitability or do so in a manner that does not require additional 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, should it be needed.

Current wording

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. While the Company believes its recent entry into new credit facilities as discussed below has significantly improved its capital position and provides a path to sustainable operations and profitability, there can be no assurance the Company will be able to achieve such profitability or do so in a manner that does not require additional 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.

Previous wording

As disclosed in Note 3, Credit and Securities Purchase Transaction, on June 21, 2024, the Company entered into a financing transaction with CCM Denali Debt Holdings, LP, an affiliate of Cerberus Capital Management LP (herein after referred to as “Cerberus”, “Denali”, “Lender”, “Holder”). As a result of this transaction, Cerberus agreed to provide a $210.5 million secured multi-draw facility to be made in four installments (the “Delayed Draw Term Loan”) as well as a $105.0 million revolving credit facility (“Revolving Facility”), to be made available beginning June 21, 2026, at Cerberus’ sole discretion and only if the Delayed Draw Term Loan is fully funded.

Current wording

As disclosed in Note 3, Credit and Securities Purchase Transaction, on June 21, 2024, the Company entered into a financing transaction with CCM Denali Debt Holdings, LP, an affiliate of Cerberus Capital Management LP (herein after referred to as “Cerberus”, “Denali”, “Lender”, “Holder”). As a result of this transaction, Cerberus agreed to provide a $210.5 million secured multi-draw facility to be made in four installments (the “Delayed Draw Term Loan”) as well as a $105.0 million revolving credit facility (“Revolving Facility”), to be made available beginning June 21, 2026, at Cerberus’ sole discretion and only if the Delayed Draw Term Loan is fully funded. As of the date the accompanying Unaudited Condensed Consolidated Financial Statements were issued (the “issuance date”), the Delayed Draw Term Loan was fully funded. As part of the Credit and Securities Purchase Transaction, Cerberus received warrants and preferred stock resulting in a 33% ownership position in the Company as of the issuance date. This ownership percentage represents $814.3 Million in market capitalization based on the May 01, 2025 closing share price of the Company’s common stock.

Previous wording

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:

Current wording

As of the issuance date, management evaluated the significance of the following negative financial conditions in accordance with Accounting Standard Codification 205-40, Going Concern:

Previous wording

•Since its inception, the Company has incurred significant losses and negative cash from operations in order to fund its development. During the nine months ended September 30, 2024, the Company incurred a net loss of $417.7 million, incurred negative cash flows from operations of $111.3 million and had an accumulated deficit of $1,293.6 million as of September 30, 2024.

Current wording

•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, 2025, the Company had net income of $15.1 million, Adjustments to reconcile net income to cash used in operations are primarily from non-cash items on the Unaudited Condensed Consolidated Statements of Cash Flows. The non-cash items totaled $60.9 million. The Company incurred negative cash flows from operations of $28.9 million and had an accumulated deficit of $1,546.6 million as of March 31, 2025.

Previous wording

•As of September 30, 2024, the Company had $23.0 million of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $74.1 million, which includes loan commitment assets of $58.5 million classified as current assets on the Unaudited Condensed Consolidated Balance Sheets.

Current wording

•As of March 31, 2025, the Company had $82.6 million of unrestricted cash and cash equivalents available to fund the Company’s operations and working capital of $94.8 million.

Previous wording

•The Company is required to remain in compliance with certain quarterly financial covenants under its Credit Agreement. These financial covenants include, as defined in the Credit Agreement, (a) Minimum Consolidated EBITDA, (b) Minimum Consolidated Revenue, and (c) Minimum Liquidity (collectively, the “financial covenants”). As of September 30, 2024, the Company was in compliance with all financial covenants and non-financial covenants, except for the September 30, 2024 Minimum Consolidated Revenue financial covenant. The Company secured a waiver of non-compliance from Cerberus for the quarter ended September 30, 2024. The Company expects it may be unable to remain in compliance with the Minimum Consolidated Revenue financial covenant beginning December 31, 2024, absent the Company’s ability to secure a waiver or amend the Credit Agreement. In the event the Company is unable to comply with the financial and the non-financial covenants as of December 31, 2024, and the Company is unable to secure another waiver, Cerberus may, at its discretion, enter into a forbearance agreement with the Company and/or exercise any and all of its existing rights and remedies, which may include, among other things, 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.

Current wording

•The Credit and Securities Purchase Transaction and the DOE Loan Facility contain certain quarterly financial covenants, which include (a) Minimum Liquidity, (b) Minimum Consolidated EBITDA, and (c) Minimum Consolidated Revenue (collectively, the “financial covenants”). As of March 31, 2025, the only financial covenant in effect was Minimum Liquidity. As of March 31, 2025, the Company was in compliance with this covenant and non-financial covenants, and the Company expects to remain in compliance with the Minimum Liquidity covenant over the next twelve months beyond the issuance date. The Minimum Consolidated EBITDA and Minimum Consolidated Revenue financial covenants become effective beginning December 31, 2025. As of March 31, 2025, the Company expects that it may be unable to remain in compliance with the Minimum Consolidated EBITDA and Minimum Consolidated Revenue financial covenants beginning December 31, 2025, absent the Company’s ability to secure a waiver or amend the Credit and Securities Purchase Transaction and the DOE Loan Facility. The Company continues to be in regular communication with Cerberus and DOE regarding these covenants. In the event the Company is unable to comply with the financial and non-financial covenants beginning December 31, 2025, and the Company is unable to secure a waiver, Cerberus and the DOE may, at their discretion, enter into a forbearance agreement with the Company and/or exercise any and all of their existing rights and remedies, which may include, among other things, asserting their rights in the Company’s assets securing the loans. Moreover, the Company’s other lenders may exercise similar rights and remedies under the cross-default provisions of their respective borrowing agreements with the Company.

Previous wording

•Cerberus funded the Company $30.0 million (“August Draw”), and the Company received $28.5 million, net of the 5.0% original issue discount, since the Company met the milestones for the August Draw as disclosed in Note 3, Credit and Securities Purchase Transaction. Subsequently, on November 1, 2024, Cerberus funded the Company $65 million related to the October 31, 2024 tranche (“October Draw” or “October Tranche”), and the Company received $61.75 million, which is net of the 5.0% original issue discount from the Delayed Draw Term Loan as disclosed in Note 21, Subsequent Events. In the event the Company does not achieve the remaining funding milestone, and Cerberus chooses not to continue funding, and the Company’s ongoing efforts to raise additional outside capital prove unsuccessful, the Company will be unable to meet its obligations as they become due over the next twelve months beyond the issuance date. In such an event, 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.

Current wording

•In the event the Company’s ongoing efforts to raise additional outside capital are unsuccessful, the Company will be unable to meet its obligations as they come due over the next twelve months beyond the issuance date. In such an event, 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.

Previous wording

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 nine months ended September 30, 2024, the Company closed on the following capital transactions:

Current wording

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, 2025, the Company closed on the following capital transactions:

Previous wording

•The Company secured a strategic investment of up to $315.5 million from Cerberus. The investment by Cerberus is structured as a $210.5 million Delayed Draw Term Loan to be made in four installments. On June 21, 2024 the first installment of $75.0 million was funded, and on August 29, 2024, the second draw of $30.0 million was funded. Additional amounts totaling $105.5 million will be made available to the Company, subject to the achievement of certain milestones. As part of the strategic investment, a $105.0 Revolving Facility will be made available to the Company at the Lenders’ sole discretion and only if the Delayed Draw Term Loan is fully funded.

Current wording

•In 2024, the Company secured a strategic investment of up to $315.5 million from Cerberus. The investment by Cerberus is structured as a $210.5 million Delayed Draw Term Loan to be made in four installments. On June 21, 2024 the first installment of $75.0 million was funded, and on August 29, 2024, the second draw of $30.0 million was funded, on October 31, 2024 the third draw of $65.0 million was funded, and on January 24, 2025, the final draw of $40.5 million was funded. As part of the strategic investment, a $105.0 million Revolving Facility can be made available to the Company at the Lenders’ sole discretion and only if the Delayed Draw Term Loan is fully funded.

Previous wording

The Company expects capital expenditures and working capital requirements to increase as it executes its growth strategy. Total capital expenditures for the nine months ended September 30, 2024 and September 30, 2023 were $20.1 million and $21.2 million, respectively. See Note 7, Property, Plant and Equipment for further discussion.

Current wording

The Company expects capital expenditures and working capital requirements to increase as it seeks to execute its growth strategy, total capital expenditures for the three months ended March 31, 2025 and March 31, 2024 were $4.9 million and $4.0 million, respectively. See Note 7, Property, Plant and Equipment for further discussion.

Previous wording

Net cash used in operating activities was $107.6 million for the nine months ended September 30, 2023, primarily driven by a net loss of $188.3 million, adjusted for non-cash items of $89.5 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 outflows from changes in operating assets and liabilities was $8.7 million, primarily driven by decrease in accounts payable of $17.8 million and increase in vendor deposits of $4.0 million, partially offset by increase in accrued expenses of $12.3 million.

Current wording

Net cash used in operating activities of $28.9 million for the three months ended March 31, 2025, adjusted for non-cash items of $60.9 million, primarily related to changes in fair value of warrants and derivatives and partially offset by stock compensation expense relating to expanded headcount in engineering, sales, manufacturing engineering and R&D. Additionally, offsets included depreciation and amortization, non-cash interest expense and the change in fair value of debt. The net cash inflows from changes in operating assets and liabilities was $16.8 million, primarily driven by an increase in contract liabilities of $17.1 million due to customer cash receipts and increase in accounts payable of $8.1 million, partially offset by an increase in inventory of $6.1 million for future production and increased 2025 volumes, increase in accounts receivable of $4.1 million due to customer invoicing and increase in grant receivable of $1.8 million.

Previous wording

Net cash used in operating activities of $111.3 million for the nine months ended September 30, 2024 was primarily driven by a net loss of $417.7 million, adjusted for non-cash items of $308.4 million, primarily related to stock compensation expense, depreciation and amortization, non-cash interest expense, gain on debt extinguishment, changes in fair value of debt, warrants and derivatives. The net cash outflows from changes in operating assets and liabilities was $1.9 million, primarily driven by an increase in inventory of $8.8 million and an increase in contract assets of $4.7 million, partially offset by an increase in contract liabilities of $5.4 million and an increase in interest payable - related party of $3.1 million.

Current wording

Net cash used in operating activities was $40.5 million for the three months ended March 31, 2024, 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.

Previous wording

Net cash flows used in investing activities for the nine months ended September 30, 2024 and September 30, 2023 was $20.1 million and $21.2 million, respectively, for payments made for purchases of property, plant and equipment.

Current wording

Net cash flows used in investing activities for the three months ended March 31, 2025 and March 31, 2024 was $4.9 million and $4.0 million, respectively, for payments made for purchases of property, plant and equipment for the improvement of manufacturing facilities.

Previous wording

Net cash provided by financing activities was $77.3 million for the nine months ended September 30, 2024, primarily due to the proceeds received from the Credit and Securities Purchase Transaction of $98.6 million and from the issuance of common stock of $14.1 million. The proceeds were partially offset by payoff of the Senior Secured Term Loan of $19.9 million, debt issuance costs - related party of $12.2 million, payments on the equipment financing facility of $2.4 million and share repurchases from employees for tax withholding of $1.1 million.

Current wording

Net cash provided by financing activities was $42.2 million for the three months ended March 31, 2025, primarily due to the proceeds received from the Credit and Securities Purchase Transaction of $38.5 million and from the exercise of warrants of $7.0 million. The proceeds were partially offset by payments on the equipment financing facility of $0.9 million and share repurchases from employees for tax withholding of $0.5 million.

Previous wording

Net cash provided by financing activities was $170.6 million for the nine months ended September 30, 2023, primarily due to the net proceeds received from the Yorkville Convertible Promissory Notes and AFG Convertible Notes of $48.1 million and from the issuance of common stock and warrants of $131.1 million. The proceeds were partially offset by equity issuance costs of $2.1 million, debt issuance costs related to the Yorkville Convertible Promissory Notes, AFG Convertible Notes and Senior Secured Term Loan of $4.2 million, payments on the equipment financing facility of $2.1 million and share repurchases from employees for tax withholding of $0.6 million.

Current wording

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.

Previous wording

•Future lease payments, including interest, under non-cancellable operating and financing leases of $4.4 million. The leases expire at various dates prior to 2028.

Current wording

•Future lease payments, including interest, under non-cancellable operating and financing leases of $3.6 million. The leases expire at various dates prior to 2028.

Previous wording

•In accordance with the Insurer Letter Agreement, the Company shall pay to the Atlas Insurers (i) on December 31, 2024, subject to the absence of certain events of default under the Credit Agreement, $3.0 million and (ii) on June 30, 2025, subject to the absence of certain events of default under the Credit Agreement, $4.0 million.

Current wording

•In accordance with the Insurer Letter Agreement, the Company shall pay to the Atlas Insurers on June 30, 2025, subject to the absence of certain events of default under the Credit Agreement, $4.0 million.

Previous wording

(1) As of September 30, 2024, the Company is obligated to repay future contractual interest payments for the 2021 Convertible Note and AFG Convertible Notes in-kind. The Company also has the option to repay the Delayed Draw Term Loan in-kind.

Current wording

(1) As of March 31, 2025, the Company is obligated to repay future contractual interest payments for these borrowings in-kind.

Previous wording

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.

Current wording

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 we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions or conditions. We regularly reevaluate our 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, 2024.