rmo-20210331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended March 31, 2021


☐			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 001-38795

ROMEO POWER, INC.

(Exact name of registrant as specified in its charter)

Delaware

83-2289787

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

4380 Ayers Avenue

Vernon, CA 90058

(833) 467-2237

(Address, including zip code, and telephone number, including

area code, of registrant’s principal executive offices)

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	RMO	New York Stock Exchange

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 every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

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


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 Exchange Act). Yes ☐ No ☒

As of May 14, 2021, 131,197,350 shares of the registrant’s common stock, $0.0001 par value, were issued and outstanding.

Table of Contents


			Page No
Part I- Financial Information			2
Item 1. Financial Statements			2
Condensed Consolidated Balan c e Sheets (Unaudited )			2
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited)			3
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (Unaudited )			4
Condensed Consolidated Statements of Cash Flows (Unaudited )			5
Notes to Condensed Consolidated Financial Statements			7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			21
Item 3. Quantitative and Qualitative Disclosures About Market Risk			35
Item 4. Controls and Procedures			35

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

Table of Contents

Part I - Financial Statements

Item 1. Financial Statements


CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2021 AND DECEMBER 31, 2020 (UNAUDITED) (In thousands, except share and per share data)


	March 31, 2021		December 31, 2020
ASSETS
Current assets
Cash and cash equivalents	$	41,278	$	292,442
Investments	246,215		—
Accounts receivable, net of allowance for expected credit loss of $213 and $238 at March 31, 2021 and December 31, 2020, respectively	1,444		841
Inventories, net	5,689		4,937
Insurance receivable	6,000		6,000
Deferred costs	998		—
Prepaid expenses and other current assets	9,306		1,269
Total current assets	310,930		305,489
Restricted cash	1,500		1,500
Property, plant and equipment, net	6,321		5,484
Equity method investments	38,357		35,000
Operating lease right-of-use assets	5,411		5,469
Other noncurrent assets	2,893		3,100
TOTAL ASSETS	$	365,412	$	356,042

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	5,033	$	2,900
Accrued expenses	3,094		2,844
Contract liabilities	1,672		815
Current maturities of long-term debt	2,783		2,260
Operating lease liabilities, current	855		853
Legal settlement payable	6,000		6,000
Other current liabilities	248		384
Total current liabilities	19,685		16,056
Commitments and contingencies (Note 14)
Long-term debt, net of current portion	559		1,082
Public and private placement warrants	11,921		138,466
Operating lease liabilities, net of current portion	4,661		4,723
Other noncurrent liabilities	—		17
Total liabilities	36,826		160,344

Stockholders’ equity
Preferred stock ($0.0001 par value, 10,000,000 shares authorized, no shares issued and outstanding at March 31, 2021 and December 31, 2020)	—		—
Common stock ($0.0001 par value, 250,000,000 shares authorized, 130,529,147 and 126,911,861 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively)	13		12
Additional paid-in capital	416,308		373,129
Accumulated other comprehensive loss	(304)		—
Accumulated deficit	(87,431)		(177,443)
Total stockholders’ equity	328,586		195,698
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	365,412	$	356,042

See accompanying notes

Table of Contents


CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020 (UNAUDITED) (In thousands, except share and per share data)


	Three Months Ended March 31,
	2021		2020
REVENUES:
Product revenues	$	341	$	1,588
Service revenues	—		52
Related party revenues	713		882
Total revenues	1,054		2,522

COST OF REVENUES:
Product cost	4,238		2,729
Service cost	—		153
Related party cost	589		750
Total cost of revenues	4,827		3,632
GROSS LOSS	(3,773)		(1,110)

OPERATING EXPENSES:
Research and development	3,771		1,802
Selling, general and administrative	17,999		2,907
Total operating expenses	21,770		4,709
OPERATING LOSS	(25,543)		(5,819)

Interest expense	(7)		(254)
Interest income	90		—
Change in fair value of public and private placement warrants	116,125		—
INCOME (LOSS) BEFORE INCOME TAXES AND LOSS IN EQUITY METHOD INVESTMENTS	90,665		(6,073)
Loss in equity method investments	(643)		(696)
Provision for income taxes	(10)

SEC Form 10-Q filed by Romeo Power, Inc.