Posts of Stephen Prybeck

Company Announces New Project Order, Incremental Issuance under the SEPA, Expected 2022 Revenue Results, and Initiates 2023 Revenue Outlook

EDISON, N.J.— Eos Energy Enterprises, Inc. (NASDAQ: EOSE) (“Eos”), a leading provider of safe, scalable, efficient, and sustainable zinc-based energy storage systems, today announced that it expects to record revenue of $17 to $20 million for 2022, which is consistent with previous guidance, with an ending cash balance (excluding restricted cash) of $17 million as of December 31, 2022. Eos will provide further commentary on its fourth quarter performance in connection with the release of its full year and fourth quarter 2022 financial results in early March.

Eos also announces an order for a 47 MWh initial renewables plus storage project with one of the largest operators of energy storage in the US, along with a separate long term agreement providing a framework for up to 4 GWh of energy storage volume over the next 6 years (the “Agreement”). The Agreement contributes 4GWh to the Company’s Pipeline and will be categorized as a letter of intent. With its active Pipeline, as well as the expected launch of the automated next generation Z3 battery production line in the third quarter, the Company currently expects 2023 revenue to be in the range of $30 to $50 million. The gross margins of Z3 are expected to be better than the current Gen 2.3 product, which we believe should result in positive operating cashflow in the second half of 2024. On February 1, 2023, the Company also issued and sold a convertible promissory note with an aggregate principal amount of $5.0 million in a private placement to YA II PN, LTD, an affiliate of Yorkville Advisors, under the Second Supplemental Agreement dated as of December 29, 2022, to the SEPA between the Company and Yorkville.

“We are very excited about our continued growth and the Agreement,” said Joe Mastrangelo, CEO of Eos. “With implementation of the 2022 Inflation Reduction Act taking place this year, we foresee continued market expansion. We continue to progress through the Department of Energy Loan Programs Office’s due diligence process, and we expect that our loan amount could be at least $250 million, if successfully approved.”

Eos is providing this preliminary select results and 2023 outlook in advance of upcoming investor meetings prior to release of earnings.

About Eos

Eos Energy Enterprises, Inc. is accelerating the shift to clean energy with positively ingenious solutions that transform how the world stores power. Our breakthrough Znyth^™ aqueous zinc battery was designed to overcome the limitations of conventional lithium-ion technology. Safe, scalable, efficient, sustainable—and manufactured in the U.S.—it’s the core of our innovative systems that today provide utility, industrial, commercial, and residential customers with a proven, reliable energy storage alternative. Eos was founded in 2008 and is headquartered in Edison, New Jersey. For more information about Eos (NASDAQ: EOSE), visit eose.com.

Key Metrics

Backlog. The Company defines backlog as the amount of revenue that we expect to realize from existing agreements with our customers for the sale of our battery energy storage systems and performance of services. The backlog is calculated by adding new orders in the current fiscal period to the backlog as of the end of the prior fiscal period and then subtracting the shipments in the current fiscal period. If the amount of an order is modified or cancelled, we adjust orders in the current period and our backlog accordingly, but do not retroactively adjust previously published backlogs. We believe that the backlog is a useful indicator regarding the future revenue of our Company.

Pipeline. Our pipeline represents projects for which we have submitted technical proposals or nonbinding quotes plus letters of intent (“LOI”) or firm commitments from customers. Pipeline does not include lead generation projects.

Booked Orders. Booked orders are orders where we have legally binding agreements with a Purchase Order or Master Supply Agreement executed by both parties.

Forward-Looking Statements

This press release includes certain statements that may constitute “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements that refer to our expected revenue for the fiscal year ended December 31, 2022 and cash balance as of December 31, 2022, the Department of Energy Loan approval process, 2023 outlook and projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Factors which may cause actual results to differ materially from current expectations include, but are not limited to: the preliminary financial information remains subject to changes and finalization based upon management’s ongoing review of results for the fourth quarter and full fiscal year 2022 and the completion of all quarter and year end closing procedures; changes adversely affecting the business in which we are engaged; our ability to forecast trends accurately; our ability to secure final approval of a loan from the Department of Energy or the final amount of any loan; our ability to generate cash, service indebtedness and incur additional indebtedness; our ability to secure financing to continue expansion; our ability to develop efficient manufacturing processes to scale and to forecast related costs and efficiencies accurately, and to secure labor; fluctuations in our revenue and operating results; competition from existing or new competitors; the failure to convert firm order backlog and pipeline to revenue; the failure to sufficiently reduce manufacturing costs, potential delays in the launch of our Z3 battery; inefficient implementation of the Inflation Reduction Act of 2022; risks associated with security breaches in our information technology systems; the risk of a government shutdown as Eos remains in due diligence on its loan application with the U.S. Department of Energy Loan Programs Office; risks related to legal proceedings or claims; risks associated with changes in federal, state, or local laws; risks associated with potential costs of regulatory compliance; risks associated with changes to U.S. trade policies; risks resulting from the impact of global pandemics, including the novel coronavirus, Covid-19; and risks related to adverse changes in general economic conditions. The forward-looking statements contained in this press release are also subject to additional risks, uncertainties, and factors, including those more fully described in Eos’s most recent filings with the Securities and Exchange Commission, including Eos’s most recent Annual Report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. Further information on potential risks that could affect actual results will be included in the subsequent periodic and current reports and other filings that Eos makes with the Securities and Exchange Commission from time to time. Moreover, Eos operates in a very competitive and rapidly changing environment, and new risks and uncertainties may emerge that could have an impact on the forward-looking statements contained in this press release. 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, Eos 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.

Randy Gonzales to step away from day-to-day operations due to family health reasons.

EDISON, N.J.— Eos Energy Enterprises, Inc. (NASDAQ: EOSE) (“Eos”), a leading provider of safe, scalable, efficient, and sustainable zinc-based long-duration energy storage systems, today announced that Randall (Randy) B. Gonzales will be stepping away from his Chief Financial Officer responsibilities into a corporate advisory role and will be succeeded by Nathan Kroeker, effective January 23, 2023.

“Over the past 12 months Randy has been a great business partner and key architect in Eos’s ability to scale and to deliver products to our customers,” said Joe Mastrangelo, CEO of Eos. “In addition, he has been instrumental in the Company’s diversification of the capital stack, including the $100 million senior secured term loan that closed in the third quarter of 2022, the up to $100 million at-the-market (“ATM”) equity program, and most recently the $13.75 million convertible note that was announced last week. Randy and I have been working over the past two months to find the right balance for him to spend more time with his family while continuing as our CFO. Sadly, we concluded that this was the best decision for Eos, and more importantly, Randy and his family.”

“Eos is a company with a bright future, and I believe that it is best for the Company to have a CFO that is 100% focused on delivering company results,” said Gonzales. “I look forward to leading the CFO transition and continuing to work with the team in my new capacity.”

Mr. Kroeker brings 25 years of finance and energy industry experience. Nathan spent 10 years at Spark Energy, starting as the CFO before eventually taking over as CEO in 2014. In 2014, Nathan led the IPO process at Spark Energy – the first independent retail energy company to successfully IPO on the NASDAQ. Nathan began his career in public accounting with Coopers & Lybrand and Arthur Andersen, before moving into transaction advisory with Ernst & Young. In 2004, Nathan left consulting for progressive finance roles at Direct Energy, a leading provider of energy and home/business services in North America. Nathan began in energy trading and upstream then eventually became VP, Finance and CFO of Direct Energy’s North American Mass Markets division in 2006. In 2009, he joined the Macquarie Bank as Senior VP and CFO of their global energy trading business.

“I was attracted to this opportunity because of the foundation the team has built,” said Kroeker. “In my time talking to the team, I see a company poised for growth and can’t wait to roll-up my sleeves and get started.”

Mr. Kroeker received an undergraduate degree in Accounting from the University of Manitoba, was a former CA in Canada, and is a licensed CPA in Texas.

“We are excited to have Nathan joining our team. He brings extensive finance and operational experience to our team. We shouldn’t miss a step in executing our strategic growth plan,” said Mastrangelo.

About Eos

Eos Energy Enterprises, Inc. is accelerating the shift to clean energy with positively ingenious solutions that transform how the world stores power. Our breakthrough Znyth^™ aqueous zinc battery was designed to overcome the limitations of conventional lithium-ion technology. Safe, scalable, efficient, sustainable—and manufactured in the U.S.—it’s the core of our innovative systems that today provide utility, industrial, commercial, and residential customers with a proven, reliable energy storage alternative. Eos was founded in 2008 and is headquartered in Edison, New Jersey. For more information about Eos (NASDAQ: EOSE), visit eose.com.

EDISON, N.J.— Eos Energy Enterprises, Inc. (NASDAQ: EOSE) (“Eos”), a leading provider of safe, scalable, efficient, and sustainable zinc-powered long-duration energy storage systems, today announced that several investors, including Clear Creek Investments, LLC, Ardsley Advisory Partners LP, and AltEnergy, LLC (together, the “Purchasers”), made a $13.75 million investment in convertible senior notes to support the Company’s strategic growth initiatives.

“We’re excited to have long-term investors in our company continue to support our growth and the plan to expand our manufacturing capacity,” said Joe Mastrangelo, CEO of Eos. “AltEnergy has been an investor in the company for nearly a decade and adding additional support from Clear Creek Investments and Ardsley Advisory Partners helps us position the company for the future.”

Eos is a leading manufacturer of long duration (3-12 hour) battery energy storage solutions featuring its proprietary Znyth® battery technology. This zinc-powered battery addresses the variability of renewable energy sources by providing reliable power to applications across the energy supply chain, including utilities, and industrial and commercial sites. Eos’ Pittsburgh-based manufacturing facility, suite of support services and majority domestically sourced supply chain, enable it to serve the needs of customers and communities around the world.

Terms of the Transaction

Under the terms of the investment, the Purchasers will purchase $13.75 million in aggregate principal amount of Eos’ 26.5% Convertible Senior PIK Notes due 2026 (the “Notes”). The Notes will have an initial conversion price of approximately $1.67 per share of Eos’ common stock, subject to customary anti-dilution and other adjustments. The Notes will bear interest at a rate of 26.5% per annum, paid semi-annually, which interest will be entirely paid-in-kind through an increase in the principal amount of the outstanding Notes or through the issuance of additional Notes. The Notes will mature in June 2026, unless earlier converted, redeemed or repurchased.

Additional information regarding this announcement may be found in a Form 8-K that will be filed with the U.S. Securities and Exchange Commission.

Cowen acted as financial advisor to Eos, and Haynes and Boone, LLP served as Eos’ legal advisor in the transaction.

This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities and shall not constitute an offer, solicitation, or sale in any jurisdiction in which such offer, solicitation, or sale is unlawful. The Notes and any shares of Eos common stock issuable upon conversion of the Notes have not been registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

About Eos

Eos Energy Enterprises, Inc. is accelerating the shift to clean energy with positively ingenious solutions that transform how the world stores power. Our breakthrough Znyth^™ aqueous zinc battery was designed to overcome the limitations of conventional lithium-ion technology. Safe, scalable, efficient, sustainable—and manufactured in the U.S.—it’s the core of our innovative systems that today provide utility, industrial, commercial, and residential customers with a proven, reliable energy storage alternative. Eos was founded in 2008 and is headquartered in Edison, New Jersey. For more information about Eos (NASDAQ: EOSE), visit eose.com.

Forward-Looking Statements

This press release includes certain statements that may constitute “forward-looking statements” for purposes of the federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements may include, for example, statements about: the convertible note investment and benefits thereof, the future financial performance of Eos; Eos’s plans for expansion and acquisitions; and changes in Eos’s strategy, future operations, financial position, estimated revenues, and losses, projected costs, prospects, plans and objectives of management. These forward-looking statements are based on information available as of the date of this press release, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing the parties’ views as of any subsequent date, and Eos does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. You should not place undue reliance on these forward-looking statements. As a result of a number of known and unknown risks and uncertainties, actual results or performance may differ materially from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to: (1) the outcome of any legal proceedings that may be instituted against Eos; 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 U.S. trade environment; risks resulting from the impact of global pandemics, including the novel coronavirus, Covid-19; (2) the ability to maintain the listing of Eos’s shares of common stock on Nasdaq; (3) the ability of Eos’s business to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; risks related to the inflationary economic environment; risk from supply chain disruptions and other impacts of geopolitical conflict; (4) changes in applicable laws or regulations; (5) the possibility that Eos may be adversely affected by other economic, business, and/or competitive factors; other factors beyond our control; risks related to adverse changes in general economic conditions; (6) the possibility of a government shutdown as Eos remains in due diligence on its loan application with the U.S. Department of Energy Loan Programs Office, and (7) other risks and uncertainties indicated from time to time in the Annual Report on Form 10-K filed by Eos with the Securities and Exchange Commission (“SEC”) for the year ended December 31, 2021, and subsequent quarterly reports on Form 10-Q, including those under the heading “Risk Factors” therein, and other factors identified in Eos’s prior and future SEC filings with the SEC, available at www.sec.gov.