SEC Filing | Solid Power

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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 September 30, 2023


☐	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: 001-40284

SOLID POWER, INC.

(Exact name of registrant as specified in its charter)


Delaware		86-1888095
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

486 S. Pierce Ave., Suite E
Louisville, Colorado		80027
(Address of principal executive offices)		(Zip Code)

(303) 219-0720

(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	SLDP	The Nasdaq Stock Market LLC
Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50	SLDPW	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 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 ☒

178,437,367 shares of common stock were issued and outstanding as of November 6, 2023.

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SOLID POWER, INC.

FORM 10-Q

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PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	22

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 6.	Exhibits	23

Signatures		24

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GLOSSARY OF DEFINED TERMS



Term		Definition
Ah		Ampere hour
BMW		BMW of North America LLC
ESPP		Solid Power, Inc. 2021 Employee Stock Purchase Plan
EV		Battery electric vehicle
EV cells		Prototype cell formats between 60 and 100 Ah
Exchange Act		Securities Exchange Act of 1934, as amended
GAAP		Generally accepted accounting principles in the United States
JDA		Joint development agreement
OEM		Automotive original equipment manufacturers
Q1 Form 10-Q		Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2023
Report		This Quarterly Report on Form 10-Q
SEC		Securities and Exchange Commission
Solid Power / the Company / we / us / our		Solid Power, Inc., a Delaware corporation (f/k/a Decarbonization Plus Acquisition Corporation III)
2022 Form 10-K		Our Annual Report on Form 10-K for the year ended December 31, 2022

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Cautionary Note Regarding Forward-Looking Statements

This Report contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. We have based these forward-looking statements on our current expectations and projections about future events. All statements, other than statements of present or historical fact included in this Report, regarding our future financial performance and our strategy, expansion plans, market opportunity, future operations, future operating results, estimated revenues or losses, projected costs, prospects, plans, and objectives of management are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “will,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “continue,” “project,” or the negative of such terms or other similar expressions. These forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions about us that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by such forward-looking statements. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Report. We caution you that the forward-looking statements contained herein are subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond our control.

In addition, we caution you that the forward-looking statements regarding the Company contained in this Report are subject to the following factors:

●

risks relating to the uncertainty of the success of our research and development efforts, including our ability to achieve the technological objectives or results that our partners require, and to commercialize our technology in advance of competing technologies;

●

risks relating to the non-exclusive nature of our OEM and JDA relationships;

●

our ability to negotiate and execute supply agreements with our partners on commercially reasonable terms;

●

rollout of our business plan and the timing of expected business milestones;

●

delays in the construction and operation of production facilities;

●

our ability to protect our intellectual property, including in jurisdictions outside of the United States;

●

broad market adoption of EVs and other technologies where we are able to deploy our cell technology and electrolyte material, if developed successfully;

●

our success in retaining or recruiting, or changes required in, our officers, key employees, including technicians and engineers, or directors;

●

risks and potential disruptions related to management and board of directors transitions;

●

changes in applicable laws or regulations;

●

risks related to technology systems and security breaches;

●

the possibility that we may be adversely affected by other economic, business or competitive factors, including supply chain interruptions, and may not be able to manage other risks and uncertainties;

●

risks relating to our status as a research and development stage company with a history of financial losses, and an expectation to incur significant expenses and continuing losses for the foreseeable future;

●

the termination or reduction of government clean energy and electric vehicle incentives;

●

changes in domestic and foreign business, market, financial, political, and legal conditions; and

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●

those factors discussed in “Part I, Item 1A. Risk Factors” in our 2022 Form 10-K and in “Part II, Item 1A. Risk Factors” in our Q1 Form 10-Q, as such descriptions may be updated or amended in future filings we make with the SEC.

We caution you that the foregoing list does not contain all of the risks or uncertainties that could affect the Company.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Report primarily on our current expectations and projections about future events and trends that we believe may affect our business, operating results, financial condition and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors, including those described in “Part I, Item 1A. Risk Factors” in our 2022 Form 10-K and “Part II, Item 1A. Risk Factors” in our Q1 Form 10-Q, as such descriptions may be updated or amended in future filings we make with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Report. We cannot assure you that the results, events, and circumstances reflected in the forward-looking statements will be achieved or occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.

Neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Moreover, the forward-looking statements made in this Report relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Report to reflect events or circumstances after the date of this Report or to reflect new information or the occurrence of unanticipated events, except as required by law. You should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make.

TRADEMARKS

Our logo and trademark appearing in this Report and the documents incorporated by reference herein are our property. This document and the documents incorporated by reference herein contains references to trademarks and service marks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this Report may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks, or service marks to imply a relationship with, or endorsement or sponsorship of it by, any other companies.

MARKET AND INDUSTRY DATA

We obtained the industry and market data used throughout this Report or any documents incorporated herein by reference from our own internal estimates and research, as well as from independent market research, industry and general publications and surveys, governmental agencies, publicly available information, and research, surveys, and studies conducted by third parties. Internal estimates are derived from publicly available information released by industry analysts and third-party sources, our internal research, and our industry experience and are based on assumptions made by us based on such data and our knowledge of our industry and market, which we believe to be reasonable. In some cases, we do not expressly refer to the sources from which this data is derived. In addition, while we believe the industry and market data included in this Report or any documents incorporated herein by reference is reliable and based on reasonable assumptions, such data involve material risks and other uncertainties and is subject to change based on various factors, including those discussed in the section entitled “Risk Factors.” These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties or by us.

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INFORMATION ABOUT SOLID POWER

We use our website (www.solidpowerbattery.com) and various social media channels (e.g., Solid Power, Inc. on LinkedIn) as a means of disclosing information about Solid Power and our products to our customers, investors, and the public. The information posted on our website and social media channels is not incorporated by reference in this Report or in any other report or document we file with the SEC. Further, references to our website URLs are intended to be inactive textual references only. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings, and public conference calls and webcasts. In addition, you may automatically receive e-mail alerts and other information about Solid Power when you enroll your e-mail address by visiting the “Email Alerts” section of our website at https://ir.solidpowerbattery.com. Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Exchange Act are filed with the SEC. These reports and other information we file with the SEC are available free of charge at https://ir.solidpowerbattery.com/financial-information/sec-filings when such reports are available on the SEC’s website.

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Solid Power, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except par value and number of shares)


	September 30, 2023
	(Unaudited)		December 31, 2022
Assets
Current Assets
Cash and cash equivalents	$	27,458	$	50,123
Marketable securities		166,030		272,957
Contract receivables		3,243		1,521
Contract receivables from related parties		5,048		319
Prepaid expenses and other current assets		3,207		2,888
Total current assets		204,986		327,808
Property, Plant and Equipment, net		99,241		82,761
Right-Of-Use Operating Lease Assets, net		7,300		7,725
Right-Of-Use Finance Lease Assets, net		1,011		922
Other Assets		1,057		1,148
Long-term Investments		228,806		172,974
Intangible Assets, net		1,525		1,108
Total assets	$	543,926	$	594,446
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable and other accrued liabilities		6,280		11,326
Current portion of long-term debt		—		7
Deferred revenue		—		4,050
Accrued compensation		4,746		4,528
Operating lease liabilities, short-term		606		549
Finance lease liabilities, short-term		342		273
Total current liabilities		11,974		20,733
Warrant Liabilities		5,637		9,117
Operating Lease Liabilities, Long-Term		8,159		8,622
Finance Lease Liabilities, Long-Term		544		602
Total liabilities		26,314		39,074
Stockholders’ Equity
Common Stock, $0.0001 par value; 2,000,000,000 shares authorized; 178,417,397 and 176,007,184 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively		18		18
Additional paid-in capital		586,347		577,603
Accumulated deficit		(65,596)		(19,090)
Accumulated other comprehensive loss		(3,157)		(3,159)
Total stockholders’ equity		517,612		555,372
Total liabilities and stockholders’ equity	$	543,926	$	594,446

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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Solid Power, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

(in thousands, except number of shares and per share amounts)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenue	$	6,366	$	2,813	$	15,063	$	7,591
Operating Expenses
Direct costs		7,183		3,544		20,354		8,561
Research and development		14,236		9,710		40,391		24,811
Selling, general and administrative		6,444		5,158		19,307		15,827
Total operating expenses		27,863		18,412		80,052		49,199
Operating Loss		(21,497)		(15,599)		(64,989)		(41,608)
Nonoperating Income and Expense
Interest income		5,213		3,128		15,041		4,300
Change in fair value of warrant liabilities		1,155		-		3,480		28,183
Interest expense		(13)		(12)		(39)		(22)
Total nonoperating income and expense		6,355		3,116		18,482		32,461
Pretax Loss		(15,142)		(12,483)		(46,507)		(9,147)
Income tax benefit		—		(84)		—		(71)
Net Loss Attributable to Common Stockholders	$	(15,142)	$	(12,399)	$	(46,507)	$	(9,076)
Other Comprehensive Income (Loss)		(215)		(2,546)		2		(3,837)
Comprehensive Loss Attributable to Common Stockholders	$	(15,357)	$	(14,945)	$	(46,505)	$	(12,913)
Basic and diluted loss per share	$	(0.08)	$	(0.07)	$	(0.26)	$	(0.05)
Weighted average shares outstanding – basic and diluted		178,388,926		175,025,984		177,800,915		173,859,649

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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Solid Power, Inc.

Condensed Consolidated Statement of Stockholders’ Equity (Unaudited)

(in thousands, except number of shares)


	Common Stock
					Additional		Accumulated		Accumulated Other		Total Stockholders’
	Shares		Amount		paid-in capital		deficit		Comprehensive Loss		Equity
Balance as of December 31, 2022		176,007,184	$	18	$	577,603	$	(19,090)	$	(3,159)	$	555,372
Net loss		—		—		—		(31,363)		—		(31,363)
Shares of common stock issued under ESPP		129,928		—		214		—		—		214
Withholding of employee taxes related to stock-based compensation		—		—		(111)		84		—		(27)
Shares of common stock issued for vested RSUs		163,148				—		—		—		—
Stock options exercised		2,026,630		—		183		—		—		183
Stock-based compensation expense		—		—		5,145		—		—		5,145
Unrealized loss on marketable securities		—		—		—		—		(213)		(213)
Balance as of June 30, 2023		178,326,890	$	18	$	583,034	$	(50,369)	$	(3,372)	$	529,311
Net loss		—		—		—		(15,142)		—		(15,142)
Withholding of employee taxes related to stock-based compensation		—		—		—		(85)		—		(85)
Shares of common stock issued for vested RSUs		32,442		—		—		—		—		—
Stock options exercised		58,065		—		11		—		—		11
Stock-based compensation expense		—		—		3,302		—		—		3,302
Unrealized gain on marketable securities		—		—		—		—		215		215
Balance as of September 30, 2023		178,417,397	$	18	$	586,347	$	(65,596)	$	(3,157)	$	517,612


	Common Stock
					Additional		Accumulated		Accumulated Other		Total Stockholders’
	Shares		Amount		paid-in capital		deficit		Comprehensive Loss		Equity
Balance as of December 31, 2021		167,557,988	$	17	$	568,183	$	(9,535)	$	—	$	558,665
Net income		—		—		—		3,323		—		3,323
Transaction fees		—		—		(12)		—		—		(12)
Stock options exercised		6,869,144		—		433		—		—		433
Stock-based compensation expense		—		—		3,910		—		—		3,910
Unrealized loss on marketable securities		—		—		—		—		(1,291)		(1,291)
Withholding of employee taxes related to stock-based compensation		—		—		(58)		—		—		(58)
Shares of common stock issued for vested RSUs		20,672		—		—		—		—		—
Balance as of June 30, 2022		174,447,804	$	17	$	572,456	$	(6,212)	$	(1,291)	$	564,970
Net loss		—		—		—		(12,399)		—		(12,399)
Stock options exercised		1,293,762		1		337		—		—		338
Stock-based compensation expense		—		—		2,588		—		—		2,588
Unrealized loss on marketable securities		—		—		—		—		(2,546)		(2,546)
Balance as of September 30, 2022		175,741,566	$	18	$	575,381	$	(18,611)	$	(3,837)	$	552,951

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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Solid Power, Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)


	Nine Months Ended September 30,
	2023		2022
Cash Flows from Operating Activities
Net loss	$	(46,507)	$	(9,076)
Adjustments to reconcile net loss to net cash and cash equivalents from operating activities:
Depreciation and amortization		7,805		3,437
Amortization of right-of-use assets		566		51
Loss on sale of property, plant and equipment		—		4
Stock-based compensation expense		8,447		6,498
Deferred taxes		—		(71)
Change in fair value of warrant liabilities		(3,480)		(28,183)
Amortization of premiums and accretion of discounts on marketable securities		(8,297)		(1,170)
Change in operating assets and liabilities that provided (used) cash and cash equivalents:
Contract receivables		(1,403)		(2,473)
Contract receivables from related parties		(5,048)		—
Prepaid expenses and other assets		297		2,101
Accounts payable and other accrued liabilities		207		(3,327)
Deferred revenue		(4,050)		(300)
Accrued compensation		218		1,831
Operating and Finance lease liabilities, short-term		(406)		192
Net cash and cash equivalents used in operating activities		(51,651)		(30,486)
Cash Flows from Investing Activities
Purchases of property, plant and equipment		(29,526)		(47,915)
Purchases of marketable securities and long-term investments		(256,584)		(448,757)
Proceeds from sales of marketable securities		315,493		111,198
Purchases of intangible assets		(428)		(308)
Net cash and cash equivalents provided by (used in) investing activities		28,955		(385,782)
Cash Flows from Financing Activities
Payments of debt		(7)		(104)
Proceeds from exercise of stock options		194		771
Proceeds from issuance of shares of common stock under ESPP		214		—
Cash paid for withholding of employee taxes related to stock-based compensation		(111)		(58)
Payments on finance lease liabilities		(259)		(76)
Transaction costs		—		(12)
Net cash and cash equivalents provided by financing activities		31		521

Net decrease in cash and cash equivalents		(22,665)		(415,747)
Cash and cash equivalents at beginning of period		50,123		513,447
Cash and cash equivalents at end of period		27,458		97,700

Cash paid for interest	$	39	$	5
Accrued capital expenditures	$	2,309	$	7,818

See accompanying Notes to Condensed Consolidated Financial Statements (Unaudited).

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Notes to Condensed Consolidated Financial Statements (Unaudited)

Note 1 – Nature of Business

Solid Power, Inc. (the “Company”) is developing solid state battery technology to enable the next generation of batteries for the fast-growing EV and other markets. The Company’s planned business model is to sell its sulfide-based solid electrolyte and to license its solid-state cell designs and manufacturing process.

Note 2 – Significant Accounting Policies

The significant accounting policies followed by the Company are set forth in Note 2 – Significant Accounting Policies to the Company’s financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (the “2022 Form 10-K”) and are supplemented by the Notes to the Condensed Consolidated Financial Statements (Unaudited) (the “Notes”) included in this Quarterly Report on Form 10-Q for the period ended September 30, 2023 (this “Report”). The financial statements included in this Report (including the Notes) should be read in conjunction with the 2022 Form 10-K.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared on the basis of generally accepted accounting principles in the United States (“GAAP”). The preparation of unaudited condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the unaudited condensed consolidated financial statements. Actual results could differ from those estimates. All dollar amounts presented herein are in U.S. dollars and are in thousands, except par value and share and per share amounts.

The accompanying unaudited condensed consolidated financial statements include accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Additionally, certain prior period amounts have been reclassified to conform to current period presentation in the accompanying unaudited condensed consolidated financial statements.

Recent Accounting Pronouncements

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), followed by other related ASUs that provided targeted improvements and additional practical expedient options. On January 1, 2022, the Company adopted the standards under Topic 842 using the modified retrospective method and elected a number of the practical expedients in its implementation. The key change that affected the Company relates to lessee accounting for operating leases that were historically off-balance sheet.

Financial Instruments

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This guidance introduces a new model for recognizing credit losses on financial instruments based on estimates of expected losses. ASU 2016-13 also provides updated guidance regarding the impairment of available-for-sale debt securities and includes additional disclosure requirements. The Company adopted this guidance as of January 1, 2022.

The Company regularly reviews its available-for-sale marketable securities and evaluates the current expected credit losses by considering changes in credit ratings, historical experience, market data, issuer-specific factors, and current economic conditions. Based on this analysis, any allowance for credit losses is immaterial but would otherwise be recorded as a reduction to the carrying value of the asset.

The Company reviews its receivable aging on an individual customer level, considering collectability of cash flows based on the risk of past events, current conditions, and forward-looking information. The Company establishes allowances for bad debts equal to the estimable portions of accounts receivable it expects not to collect. Allowances for doubtful accounts are recorded as reductions to the carrying values of the related receivables. To date, the Company has not recorded an allowance for doubtful accounts.

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Note 3 – Property, Plant and Equipment

Property, plant and equipment are summarized as follows:


	September 30, 2023		December 31, 2022
Commercial production equipment	$	25,594	$	21,595
Laboratory equipment		8,307		3,278
Leasehold improvements		45,664		27,996
Furniture and computer equipment		1,635		1,482
Construction in progress		37,402		40,036
Total cost		118,602		94,387
Accumulated depreciation		(19,361)		(11,626)
Net property and equipment	$	99,241	$	82,761

Depreciation expenses for dedicated laboratory equipment and commercial production equipment are charged to research and development. The other depreciation expenses are included in the Company’s overhead and are allocated across Operating Expenses based on Company personnel costs incurred.

Depreciation expense related to property, plant and equipment are summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Depreciation expense	$	2,896	$	1,653	$	7,794	$	3,430

The Company expanded its cell production capabilities through the construction of a second dry room and installation of an EV cell pilot line at its Louisville, Colorado facility, which is designed to produce larger format solid-state battery cells for the automotive qualification process.

The Company expanded its electrolyte production at its facility in Thornton, Colorado. Scaling this production will allow it to produce larger quantities of electrolyte material required to feed cell-production lines and continue research and development efforts. The Company began producing electrolyte at this facility in 2023 and has placed portions of the facility into service.


	September 30, 2023		December 31, 2022
Construction in progress
EV cell pilot line - Louisville, CO	$	1,095	$	2,010
Other cell and electrolyte development equipment - Louisville, CO		4,148		2,206
Electrolyte production and development equipment - Thornton, CO		32,159		35,820

Note 4 – Intangible Assets

Intangible assets of the Company are summarized as follows:


	September 30, 2023				December 31, 2022
	Gross Carrying		Accumulated		Gross Carrying		Accumulated
	Amount		Amortization		Amount		Amortization
Intangible assets:
Licenses	$	149	$	(58)	$	149	$	(51)
Patents		92		(4)		—		—
Patents pending		1,316		—		984		—
Trademarks		13		—		9		—
Trademarks pending		17		—		17		—
Total amortized intangible assets	$	1,587	$	(62)	$	1,159	$	(51)

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Amortization expense for intangible assets is summarized as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Amortization expense	$	3	$	2	$	11	$	7

Useful lives of intangible assets range from three to 20 years. Amortization expenses are allocated ratably across Operating Expenses based on Company personnel costs incurred.

Note 5 – Fair Value Measurements

The carrying amounts of certain financial instruments, such as cash equivalents, short-term investments, accounts receivable, accounts payable, and accrued liabilities, approximate fair value due to their relatively short maturities.

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

As of September 30, 2023 and December 31, 2022, the Company’s financial assets and liabilities measured and recorded at fair value on a recurring basis were classified within the fair value hierarchy as follows:


	September 30, 2023
	Level 1		Level 2		Level 3		Total
Assets
Commercial Paper	$	125,985	$	—	$	—	$	125,985
Corporate Bonds	$	210,199	$	—	$	—	$	210,199
Government Bonds	$	58,652	$	—	$	—	$	58,652

Liabilities
Public Warrants	$	3,044	$	—	$	—	$	3,044
Private Placement Warrants	$	—	$	2,593	$	—	$	2,593


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets
Commercial Paper	$	165,179	$	—	$	—	$	165,179
Corporate Bonds	$	227,957	$	—	$	—	$	227,957
Government Bonds	$	42,865	$	—	$	—	$	42,865
U.S. Treasuries		9,930		—		—		9,930

Liabilities
Public Warrants	$	4,900	$	—	$	—	$	4,900
Private Placement Warrants	$	—	$	4,217	$	—	$	4,217

The change in fair value of the Company’s marketable securities and long-term investments are included in other comprehensive income (loss). There were no transfers in and out of Level 3 fair value hierarchy during the nine months ended September 30, 2023 or year ended December 31, 2022. During the nine months ended September 30, 2023 and 2022, the Company purchased $256,584 and $448,757 of marketable securities and long-term investments, respectively.

Fair Value of Warrants

The fair value of the Public Warrants (defined below) has been measured based on the quoted price of such warrants on the Nasdaq Stock Market, a Level 1 directly observable input. The fair value of the Private Placement Warrants (defined below) has been estimated using a Black-Scholes model as of September 30, 2023 and December 31, 2022 Consolidated Balance Sheet dates. The estimated fair value of the Private Placement Warrants is determined using Level 2 directly or indirectly observable inputs. Assumptions related to expected stock-price volatility, expected life, risk-free interest rate, and dividend yield are inherent in a Black-Scholes model. Material increases (or decreases) in any of those inputs may result in a significantly higher (or lower) fair value measurement. The Company estimates the volatility of its Private Placement Warrants based on implied volatility from the Company’s Public Warrants and from historical volatility of select peer companies’ common stock that matches the expected remaining life of the

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Warrants (defined below). The expected life of the Warrants is assumed to be equivalent to their remaining contractual term. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve for a maturity similar to the expected remaining life of the Warrants. The dividend yield is based on the historical rate, which the Company anticipates remaining at zero. The following table provides quantitative information regarding Level 2 inputs used in the recurring valuation of the Private Placement Warrants as of their measurement dates:


	September 30, 2023			December 31, 2022
Exercise price	$	11.50		$	11.50
Stock price	$	2.02		$	2.54
Volatility		81.8	%		71.3	%
Term (years)		3.19			3.94
Risk-free rate		4.67	%		4.03	%

The following table provides a reconciliation of the Public Warrants measured at fair value using Level 1 inputs and Private Placement Warrants measured at fair value using Level 2 inputs: