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 September 30, ~~2022~~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: 001-40581

FREYR Battery

(Exact name of Registrant as specified in its charter)


Luxembourg						Not Applicable
(State or other jurisdiction of						(I.R.S. Employer
incorporation or organization)						Identification Number)

22-24, Boulevard Royal, L-2449 Luxembourg

Grand Duchy of Luxembourg

+352 46 61 11 3721

(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

Ordinary Shares, without nominal value

FREY

The New York Stock Exchange

Warrants, each whole warrant exercisable for one
Ordinary Share at an exercise price of $11.50

FREY WS

The 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, 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 November ~~10, 2022,~~3, 2023, 139,705,234 shares of the ~~registrant had 116,705,234 ordinary shares, without nominal value,~~registrant’s Ordinary Shares were outstanding.

TABLE OF CONTENTS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make forward-looking statements in this Quarterly Report on Form 10-Q (this “Report”) and in documents incorporated herein by reference. All statements, other than statements of present or historical fact included in or incorporated by reference in this Report, regarding FREYR Battery’s future financial performance, as well as our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans, and objectives of management are forward-looking statements. When used in this Report, the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would”, the negative of such terms, and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations, assumptions, hopes, beliefs, intentions, and strategies regarding future events and are based on currently available information as to the outcome and timing of future events. We caution you that these forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to our business.

These forward-looking statements are based on information available as of the date of this Report, and current expectations, forecasts, and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements in this Report and in any document incorporated herein by reference should not be relied upon as representing our views as of any subsequent date, and we do 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.

~~As a result of a number of known and unknown~~These forward-looking statements involve risks and uncertainties ~~our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors~~ that could cause our actual results to differ ~~include:~~materially from those in the forward-looking statements, including, without limitation, the risks set forth in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the U.S. Securities and Exchange Commission (the "SEC") on February 27, 2023 and in our other filings with the SEC. We do not assume any obligation to update any forward-looking statements.

•~~Changes adversely affecting the battery industry~~FREYR intends to use its website as a channel of distribution to disclose information which may be of interest or material to investors and to communicate with investors and the ~~development~~public. Such disclosures will be included on FREYR’s website in the ‘Investor Relations’ sections. FREYR also intends to use certain social media channels, including, but not limited to, Twitter and LinkedIn, as means of ~~existing or new technologies;~~communicating with the public and investors about FREYR, its progress, products and other matters. While not all the information that FREYR posts to its digital platforms may be deemed to be of a material nature, some information may be. As a result, FREYR encourages investors and others interested to review the information that it posts and to monitor such portions of FREYR’s website and social media channels on a regular basis, in addition to following FREYR’s press releases, SEC filings, and public conference calls and webcasts. The contents of FREYR’s website and other social media channels shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

•~~The effect~~Foreign Private Issuer Status and Financial Presentation

We currently qualify as a foreign private issuer (“FPI”) under the rules of the ~~COVID-19 pandemic~~SEC. However, even though we qualify as an FPI, we report our financial results in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and we have elected to file our annual, quarterly, and current reports on Forms 10-K, 10-Q, and 8-K. We currently expect to lose our ~~business;~~

•~~The failure~~FPI status as of ~~24M Technologies,~~December 31, 2023, as a result of the completion of our previously announced plan to redomicile FREYR from Luxembourg to the U.S., subject to obtaining shareholder approval, and all the conditions precedent to the merger between FREYR and its wholly owned subsidiary, FREYR Delaware, Inc. (“~~24M”~~FREYR Delaware”) ~~technology~~being satisfied or ~~our batteries to perform~~waived, as ~~expected;~~

•~~Our ability to commercialize 24M and other technology for our licensing business model and business plans;~~

•~~Our ability to manufacture battery cells and to develop and increase our production capacity in a cost-effective manner;~~

•~~The electrification of energy sources does not develop as expected, or develops more slowly than expected;~~

•~~Technological developments in existing technologies or new developments in competitive technologies that could adversely affect the demand for our battery cells;~~

•~~General economic and geopolitical conditions;~~

•~~Increases~~outlined in the ~~cost of electricity or raw materials~~Registration Statement on Form S-4, filed by FREYR Delaware with the SEC on September 8, 2023, and ~~components;~~subsequent amendments thereto.

•~~Our ability to protect our intellectual property;~~

•~~Changes in applicable laws or regulations, including environmental and export control laws;~~

•~~Our ability to attract and retain key employees;~~

•~~Our ability to execute and realize our business strategy and plans;~~

•~~Our ability to target and retain customers and suppliers;~~

•~~The failure to build our finance infrastructure and improve our accounting systems and controls;~~

•Our ability to assert, enforce and otherwise protect against unauthorized use of intellectual property rights licensed from 24M, which could result in our competitors using the intellectual property to offer products;

•~~The outcome of any legal proceedings relating to our products and services, including intellectual property or product liability claims;~~

•~~Whether and when we might pay dividends;~~

•~~Our ability to source materials from an ethically and sustainably sourced supply chain and 24M-qualified suppliers in sufficient quantities;~~

•~~The result of future financing efforts;~~

•~~The cost-competitiveness, carbon footprint, energy density, and charge-rates of our batteries;~~

•~~The timing, capacity, configurations, and locations of our battery factories and production lines;~~

•~~The planned construction and production dates for the customer qualification plant (“CQP”) and the planned construction period for each of our gigafactories;~~

•~~The cost to build the CQP and the gigafactories;~~

•~~Our expectations for our general and administrative expenses;~~

•Our expectations about market supply, demand, and other dynamics, including the number of industrial-scale battery manufacturing facilities in Norway, supply costs, regulatory developments, increased globalization, and consolidation in the automotive and energy industries;

•~~The use and mix of lithium-nickel-manganese-oxide and lithium-iron-phosphate battery chemistries, including shifts in the battery chemistry mix due to conversations with potential customers;~~

•~~The market segments that we will initially target;~~

•Whether we will successfully enter into or obtain, and the impact of failing to sign or obtain, customer offtake agreements, necessary consents, other commercial agreements, permits, or licenses in a timely manner or at all; and

•~~Our ability to enter successful joint venture partnerships and licensing arrangements.~~

~~Other risks and uncertainties set forth in this Report, including risk factors discussed in Item 1A under the heading, “Risk Factors~~”.

~~iii~~

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

FREYR BATTERY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

(Unaudited)


		September 30, 2022		December 31, 2021			September 30, 2023		December 31, 2022

ASSETS	ASSETS					ASSETS
Current assets:	Current assets:							Current assets:
Cash and cash equivalents	Cash and cash equivalents	$	416,431	$	563,956	Cash and cash equivalents	$	299,419	$	443,063
Restricted cash	Restricted cash	2,160		1,671		Restricted cash	28,442		119,982
Prepaid assets	Prepaid assets	9,397		15,882		Prepaid assets	5,690		8,293
Other current assets	Other current assets	9,317		1,282		Other current assets	7,317		8,117
Total current assets	Total current assets	437,305		582,791		Total current assets	340,868		579,455

Property and equipment, net	Property and equipment, net	90,392		21,062		Property and equipment, net	349,388		210,777
Intangible assets, net						Intangible assets, net	2,850		2,963
Long-term investments						Long-term investments	22,475		—
Convertible note	Convertible note	20,498		20,231		Convertible note	—		19,954
Equity method investments		1,807		2,938
Right-of-use asset under operating leases	Right-of-use asset under operating leases	12,730		—		Right-of-use asset under operating leases	23,233		14,538

Other long-term assets	Other long-term assets	9		11		Other long-term assets	14		11
Total assets	Total assets	$	562,741	$	627,033	Total assets	$	738,828	$	827,698

LIABILITIES AND SHAREHOLDERS’ EQUITY	LIABILITIES AND SHAREHOLDERS’ EQUITY					LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	2,795	$	3,813	Accounts payable	$	18,751	$	6,765
Accrued liabilities and other	Accrued liabilities and other	34,026		15,077		Accrued liabilities and other	27,793		51,446
Accounts payable and accrued liabilities - related party		799		3,316
Deferred income		1,306		1,380

Share-based compensation liability	Share-based compensation liability	8,227		2,211		Share-based compensation liability	1,806		4,367
Total current liabilities	Total current liabilities	47,153		25,797		Total current liabilities	48,350		62,578

Warrant liability	Warrant liability	94,712		49,124		Warrant liability	10,540		33,849
Operating lease liability	Operating lease liability	9,933		—		Operating lease liability	18,353		11,144
Long-term share-based compensation liability		—		6,627

Other long-term liabilities						Other long-term liabilities	27,145		—

Total liabilities	Total liabilities	151,798		81,548		Total liabilities	104,388		107,571

Commitments and contingencies	Commitments and contingencies					Commitments and contingencies

Shareholders’ equity:	Shareholders’ equity:					Shareholders’ equity:
Ordinary share capital, no par value, 245,000 ordinary shares authorized and 116,854 issued as of both September 30, 2022 and December 31, 2021 and 116,704 and 116,854 ordinary shares outstanding as of September 30, 2022 and December 31, 2021, respectively		116,854		116,854
Ordinary share capital, no par value, 245,000 ordinary shares authorized, and 139,854 and 139,705 ordinary shares issued and outstanding, respectively, as of both September 30, 2023 and December 31, 2022						Ordinary share capital, no par value, 245,000 ordinary shares authorized, and 139,854 and 139,705 ordinary shares issued and outstanding, respectively, as of both September 30, 2023 and December 31, 2022	139,854		139,854
Additional paid-in capital	Additional paid-in capital	540,561		533,418		Additional paid-in capital	783,234		772,602
Treasury stock	Treasury stock	(1,052)		—		Treasury stock	(1,041)		(1,041)
Accumulated other comprehensive (loss) income	Accumulated other comprehensive (loss) income	(17,071)		(524)		Accumulated other comprehensive (loss) income	(38,915)		9,094
Accumulated deficit	Accumulated deficit	(228,349)		(104,263)		Accumulated deficit	(250,847)		(203,054)
Total shareholders' equity		410,943		545,485
Total ordinary shareholders' equity						Total ordinary shareholders' equity	632,285		717,455

Total liabilities and shareholders' equity		$	562,741	$	627,033
Non-controlling interests						Non-controlling interests	2,155		2,672
Total equity						Total equity	634,440		720,127

Total liabilities and equity						Total liabilities and equity	$	738,828	$	827,698

See accompanying Notes to Condensed Consolidated Financial Statements.

FREYR BATTERY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In Thousands, Except per Share Amounts)

(Unaudited)


		Three months ended September 30,				Nine months ended September 30,					Three months ended September 30,				Nine months ended September 30,
		2022		2021		2022		2021			2023		2022		2023		2022
Operating expenses:	Operating expenses:									Operating expenses:
General and administrative	General and administrative	$	25,124	$	30,057	$	77,888	$	46,245	General and administrative	$	27,772	$	25,124	$	85,405	$	77,888
Research and development	Research and development	3,253		5,257		9,194		11,209		Research and development	7,086		3,253		18,295		9,194
Equity in losses from investee		668		—		1,131		—
Share of net loss of equity method investee										Share of net loss of equity method investee	153		668		208		1,131
Total operating expenses	Total operating expenses	29,045		35,314		88,213		57,454		Total operating expenses	35,011		29,045		103,908		88,213
Loss from operations	Loss from operations	(29,045)		(35,314)		(88,213)		(57,454)		Loss from operations	(35,011)		(29,045)		(103,908)		(88,213)

Other income (expense):	Other income (expense):									Other income (expense):
Warrant liability fair value adjustment	Warrant liability fair value adjustment	(70,292)		(11,173)		(45,588)		(11,173)		Warrant liability fair value adjustment	24,399		(70,292)		23,248		(45,588)
Redeemable preferred shares fair value adjustment		—		—		—		75

Convertible note fair value adjustment	Convertible note fair value adjustment	(224)		—		267		—		Convertible note fair value adjustment	—		(224)		1,074		267
Interest income		71		51		132		59
Interest expense		(11)		(1)		(43)		(1)
Foreign currency transaction gain		4,325		1,015		5,415		827
Interest income, net										Interest income, net	1,284		60		6,042		89

Foreign currency transaction (loss) gain										Foreign currency transaction (loss) gain	(3,213)		4,325		20,546		5,415
Other income, net	Other income, net	1,326		3		3,944		2,325		Other income, net	2,537		1,326		5,029		3,944
Total other income (expense)	Total other income (expense)	(64,805)		(10,105)		(35,873)		(7,888)		Total other income (expense)	25,007		(64,805)		55,939		(35,873)
Loss before income taxes	Loss before income taxes	(93,850)		(45,419)		(124,086)		(65,342)		Loss before income taxes	(10,004)		(93,850)		(47,969)		(124,086)
Income tax expense	Income tax expense	—		—		—		—		Income tax expense	—		—		(341)		—
Net loss	Net loss	$	(93,850)	$	(45,419)	$	(124,086)	$	(65,342)	Net loss	(10,004)		(93,850)		(48,310)		(124,086)
Net loss attributable to non-controlling interests										Net loss attributable to non-controlling interests	219		—		517		—
Net loss attributable to ordinary shareholders										Net loss attributable to ordinary shareholders	$	(9,785)	$	(93,850)	$	(47,793)	$	(124,086)

Weighted average ordinary shares outstanding - basic and diluted	Weighted average ordinary shares outstanding - basic and diluted	116,704		108,713		116,795		61,467		Weighted average ordinary shares outstanding - basic and diluted	139,705		116,704		139,705		116,795

Net loss per share - basic and diluted		$	(0.80)	$	(0.42)	$	(1.06)	$	(1.06)
Net loss attributable to ordinary shareholders per share - basic and diluted										Net loss attributable to ordinary shareholders per share - basic and diluted	$	(0.07)	$	(0.80)	$	(0.34)	$	(1.06)

Other comprehensive loss:
Other comprehensive income (loss):										Other comprehensive income (loss):
Net loss	Net loss	$	(93,850)	$	(45,419)	$	(124,086)	$	(65,342)	Net loss	$	(10,004)	$	(93,850)	$	(48,310)	$	(124,086)
Foreign currency translation adjustments	Foreign currency translation adjustments	(9,089)		(558)		(16,547)		(324)		Foreign currency translation adjustments	6,134		(9,089)		(48,009)		(16,547)
Total comprehensive loss	Total comprehensive loss	$	(102,939)	$	(45,977)	$	(140,633)	$	(65,666)	Total comprehensive loss	$	(3,870)	$	(102,939)	$	(96,319)	$	(140,633)
Comprehensive loss attributable to non-controlling interests										Comprehensive loss attributable to non-controlling interests	219		—		517		—
Comprehensive loss attributable to ordinary shareholders										Comprehensive loss attributable to ordinary shareholders	$	(3,651)	$	(102,939)	$	(95,802)	$	(140,633)

See accompanying Notes to Condensed Consolidated Financial Statements.

FREYR BATTERY

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY ~~(DEFICIT)~~

(In Thousands)

(Unaudited)


					Additional Paid-in Capital				Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Accumulated Deficit				Total Shareholders’ Equity (Deficit)						Ordinary Shareholders’ Equity
		Ordinary Shares														Ordinary Shares								Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)					Treasury Stock				Accumulated Deficit						Non-controlling interests				Total Equity
		Shares	Amount
Balance as of January 1, 2021		37,452	$	—			$	15,183			$	658									$	—							$	(10,885)									$	4,956
																							Shares				Amount					Additional Paid-in Capital				Accumulated Other Comprehensive Income (Loss)						Treasury Stock							Accumulated Deficit					Non-controlling interests					Total Equity
Balance as of January 1, 2022																				Balance as of January 1, 2022			116,854				$	116,854
Share-based compensation expense	Share-based compensation expense	—	—				4,617				—				—				—				4,617		Share-based compensation expense			—						—
Net loss	Net loss	—	—		—				—		—		(11,887)				(11,887)			Net loss			—			—					—								—							—								(34,907)					—	(34,907)
Other comprehensive income	Other comprehensive income	—	—		—				57		—		—				57			Other comprehensive income			—			—					—				333						—						—					—					333
Balance as of March 31, 2021		37,452	—		$	19,800			$	715	$	—	$	(22,772)			$	(2,257)
Balance as of March 31, 2022																				Balance as of March 31, 2022			116,854			$	116,854				$		534,268				$	(191)					$	—			$	(139,170)				$	—				$	511,761
Share-based compensation expense	Share-based compensation expense	—	—		528				—		—		—				528			Share-based compensation expense			—			—					5,371				—						—				—					—					5,371
Net loss		—	—		—				—		—		(8,036)				(8,036)
Other comprehensive income		—	—		—				177		—		—				177
Balance as of June 30, 2021		37,452	—		$	20,328			$	892	$	—	$	(30,808)			$	(9,588)
Net income																				Net income			—			—					—				—						—				4,671					—					4,671
Repurchase of shares																				Repurchase of shares			—			—					—				—						(1,052)				—					—					(1,052)
Other comprehensive loss																				Other comprehensive loss			—			—					—				(7,791)						—				—					—					(7,791)
Balance as of June 30, 2022																				Balance as of June 30, 2022			116,854			$	116,854				$		539,639			$	(7,982)						$	(1,052)			$	(134,499)				$	—				$	512,960
Share-based compensation expense	Share-based compensation expense	—	—		8,349				—		—		—				8,349			Share-based compensation expense			—			—					922				—						—				—					—					922
Norway Demerger		—	—		(2,897)				—		—		—				(2,897)
Issuance of ordinary shares in settlement of FREYR Legacy preferred shares		1,490	—		14,895				—		—		—				14,895
PIPE Investment, net of transaction costs		60,000	—		579,000				—		—		—				579,000
Business Combination, net of redemptions and transaction costs		17,498	—		39,192												39,192
Net loss	Net loss	—	—		—				—		—		(45,419)				(45,419)			Net loss			—			—					—				—						—				(93,850)					—					(93,850)

Other comprehensive loss	Other comprehensive loss	—	—		—				(558)		—		—				(558)			Other comprehensive loss			—			—					—				(9,089)						—				—					—					(9,089)
Balance as of September 30, 2021		116,440	—		$	658,868			$	334	$	—	$	(76,227)			$	582,975
Balance as of September 30, 2022																				Balance as of September 30, 2022			116,854			116,854					$	540,561			$	(17,071)					$	(1,052)			$	(228,349)				$	—				$	410,943


					Additional Paid-in Capital				Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Accumulated Deficit				Total Shareholders’ Equity (Deficit)						Ordinary Shareholders’ Equity
		Ordinary Shares														Ordinary Shares								Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)					Treasury Stock				Accumulated Deficit						Non-controlling interests				Total Equity
		Shares	Amount
Balance as of January 1, 2022		116,854	$	116,854			$	533,418			$	(524)									$	—							$	(104,263)									$	545,485
																							Shares				Amount					Additional Paid-in Capital				Accumulated Other Comprehensive Income (Loss)						Treasury Stock							Accumulated Deficit					Non-controlling interests					Total Equity
Balance as of January 1, 2023																				Balance as of January 1, 2023			139,854				$	139,854
Share-based compensation expense	Share-based compensation expense	—	—				850				—				—				—				850		Share-based compensation expense			—						—
Net loss	Net loss	—	—		—				—		—		(34,907)				(34,907)			Net loss			—			—					—								—							—								(12,726)					(177)	(12,903)
Other comprehensive income		—	—		—				333		—		—				333
Balance as of March 31, 2022		116,854	116,854		$	534,268			$	(191)	$	—	$	(139,170)			$	511,761
Reclassification of warrants from liability classified to equity classified																				Reclassification of warrants from liability classified to equity classified			—			—					5				—						—						—					—					5
Other comprehensive loss																				Other comprehensive loss			—			—					—				(33,718)						—				—					—					(33,718)
Balance as of March 31, 2023																				Balance as of March 31, 2023			139,854			$	139,854				$		774,069				$	(24,624)					$	(1,041)			$	(215,780)				$	2,495				$	674,973
Share-based compensation expense	Share-based compensation expense	—	—		5,371				—		—		—				5,371			Share-based compensation expense			—			—					3,688				—						—				—					—					3,688
Net income		—	—		—				—		—		4,671				4,671
Repurchase of shares		—	—		—				—		(1,052)		—				(1,052)
Net loss																				Net loss			—			—					—				—						—				(25,282)					(121)					(25,403)
Reclassification of warrants from liability classified to equity classified																				Reclassification of warrants from liability classified to equity classified			—			—					56				—						—				—					—					56
Other comprehensive loss	Other comprehensive loss	—	—		—				(7,791)		—		—				(7,791)			Other comprehensive loss			—			—					—				(20,425)						—				—					—					(20,425)
Balance as of June 30, 2022		116,854	116,854		$	539,639			$	(7,982)	$	(1,052)	$	(134,499)			$	512,960
Balance as of June 30, 2023																				Balance as of June 30, 2023			139,854			$	139,854				$		777,813			$	(45,049)						$	(1,041)			$	(241,062)				$	2,374				$	632,889
Share-based compensation expense	Share-based compensation expense	—	—		922				—		—		—				922			Share-based compensation expense			—			—					5,421				—						—				—					—					5,421
Net loss	Net loss	—	—		—				—		—		(93,850)				(93,850)			Net loss			—			—					—				—						—				(9,785)					(219)					(10,004)

Other comprehensive loss	Other comprehensive loss	—	—		—				(9,089)		—		—				(9,089)			Other comprehensive loss			—			—					—				6,134						—				—					—					6,134
Balance as of September 30, 2022		116,854	116,854		$	540,561			$	(17,071)	$	(1,052)	$	(228,349)			$	410,943
Balance as of September 30, 2023																				Balance as of September 30, 2023			139,854			139,854					$	783,234			$	(38,915)					$	(1,041)			$	(250,847)				$	2,155				$	634,440

See accompanying Notes to Condensed Consolidated Financial Statements.

FREYR BATTERY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

(Unaudited)


		Nine months ended September 30,					Nine months ended September 30,
		2022		2021			2023		2022
Cash flows from operating activities:	Cash flows from operating activities:					Cash flows from operating activities:
Net loss	Net loss	$	(124,086)	$	(65,342)	Net loss	$	(48,310)	$	(124,086)
Adjustments to reconcile net loss to cash used in operating activities:	Adjustments to reconcile net loss to cash used in operating activities:					Adjustments to reconcile net loss to cash used in operating activities:
Share-based compensation expense	Share-based compensation expense	9,280		14,367		Share-based compensation expense	7,859		9,280
Depreciation		298		54
Depreciation and amortization						Depreciation and amortization	1,922		298

Reduction in the carrying amount of right-of-use assets	Reduction in the carrying amount of right-of-use assets	1,096		—		Reduction in the carrying amount of right-of-use assets	1,005		1,096
Warrant liability fair value adjustment	Warrant liability fair value adjustment	45,588		11,173		Warrant liability fair value adjustment	(23,248)		45,588
Redeemable preferred shares fair value adjustment		—		(74)

Convertible note fair value adjustment	Convertible note fair value adjustment	(267)		—		Convertible note fair value adjustment	(1,074)		(267)
Equity in losses from investee		1,131		—
Share of net loss of equity method investee						Share of net loss of equity method investee	208		1,131

Foreign currency transaction net unrealized gain	Foreign currency transaction net unrealized gain	(4,864)		—		Foreign currency transaction net unrealized gain	(19,346)		(4,864)
Other	Other	—		(54)		Other	145		—
Changes in assets and liabilities:	Changes in assets and liabilities:					Changes in assets and liabilities:
Prepaid assets		4,054		(6,065)
Other current assets		(11,113)		(236)
Accounts payable and accrued liabilities		5,692		8,365
Accounts payable and accrued liabilities - related party		820		738
Other current liabilities		(2)		—
Deferred income		182		1,431
Prepaid assets and other current assets						Prepaid assets and other current assets	1,672		(7,059)

Accounts payable, accrued liabilities and other						Accounts payable, accrued liabilities and other	28,401		6,692

Operating lease liability	Operating lease liability	(802)		—		Operating lease liability	(3,212)		(802)
Net cash used in operating activities	Net cash used in operating activities	(72,993)		(35,643)		Net cash used in operating activities	(53,978)		(72,993)

Cash flows from investing activities:	Cash flows from investing activities:					Cash flows from investing activities:
Proceeds from property related grants	Proceeds from property related grants	10,461		—		Proceeds from property related grants	3,500		10,461
Purchases of property and equipment	Purchases of property and equipment	(77,687)		(4,099)		Purchases of property and equipment	(168,811)		(77,687)
Investments in equity method investee	Investments in equity method investee	(3,000)		—		Investments in equity method investee	(1,655)		(3,000)
Purchases of other long-term assets	Purchases of other long-term assets	—		(12)		Purchases of other long-term assets	(1,000)		—
Net cash used in investing activities	Net cash used in investing activities	(70,226)		(4,111)		Net cash used in investing activities	(167,966)		(70,226)

Cash flows from financing activities:	Cash flows from financing activities:					Cash flows from financing activities:
Repurchase of treasury shares	Repurchase of treasury shares	(1,052)		—		Repurchase of treasury shares	—		(1,052)
Proceeds from Business Combination		—		70,836
Proceeds from PIPE Investment		—		600,000
Issuance cost		—		(26,334)
Payments for the Norway Demerger		—		(3,002)
Proceeds from issuance of redeemable preferred shares		—		7,500
Net cash (used in) provided by financing activities		(1,052)		649,000

Net cash used in financing activities						Net cash used in financing activities	—		(1,052)

Effect of changes in foreign exchange rates on cash, cash equivalents, and restricted cash	Effect of changes in foreign exchange rates on cash, cash equivalents, and restricted cash	(2,765)		(730)		Effect of changes in foreign exchange rates on cash, cash equivalents, and restricted cash	(13,240)		(2,765)
Net (decrease) increase in cash, cash equivalents, and restricted cash		(147,036)		608,516
Net decrease in cash, cash equivalents, and restricted cash						Net decrease in cash, cash equivalents, and restricted cash	(235,184)		(147,036)
Cash, cash equivalents, and restricted cash at beginning of period	Cash, cash equivalents, and restricted cash at beginning of period	565,627		14,945		Cash, cash equivalents, and restricted cash at beginning of period	563,045		565,627
Cash, cash equivalents, and restricted cash at end of period	Cash, cash equivalents, and restricted cash at end of period	$	418,591	$	623,461	Cash, cash equivalents, and restricted cash at end of period	$	327,861	$	418,591

Significant non-cash investing and financing activities:	Significant non-cash investing and financing activities:					Significant non-cash investing and financing activities:
Accrued purchases of property and equipment	Accrued purchases of property and equipment	$	18,514	$	—	Accrued purchases of property and equipment	$	11,187	$	18,514
Settlement of accrued liabilities through issuance of non-employee warrants		—		460

Reconciliation to consolidated balance sheets:

Reconciliation to condensed consolidated balance sheets:						Reconciliation to condensed consolidated balance sheets:
Cash and cash equivalents	Cash and cash equivalents	$	416,431	$	622,582	Cash and cash equivalents	$	299,419	$	416,431
Restricted cash	Restricted cash	2,160		879		Restricted cash	28,442		2,160
Cash, cash equivalents, and restricted cash	Cash, cash equivalents, and restricted cash	$	418,591	$	623,461	Cash, cash equivalents, and restricted cash	$	327,861	$	418,591

See accompanying Notes to Condensed Consolidated Financial Statements.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. ~~BUSINESS AND BASIS~~SUMMARY OF ~~PRESENTATION~~SIGNIFICANT ACCOUNTING POLICIES

Description of the Business

FREYR Battery (“FREYR,” the “Company”, “we”, or “us”) is a developer of clean, next-generation battery cell production capacity. Our mission and vision are to accelerate the decarbonization of global energy and transportation systems by producing clean, cost-competitive batteries. ~~We are in the design~~Through our strategy of Speed, Scale, and ~~testing phase related~~Sustainability, we seek to serve our ~~battery production process~~primary markets of energy storage systems (“ESS”) and commercial mobility, including marine applications and commercial vehicles, and we ~~are in~~have future ambitions to serve the ~~final stages of~~electric vehicles market (“EV”).

We have put into service the ~~construction of~~buildings and infrastructure and certain manufacturing equipment at our Customer Qualification Plant (“CQP”). We are close to completing the construction of the initial buildings and ~~groundworks and foundation structures~~infrastructure for our ~~inaugural~~ gigafactory, (“Giga ~~Arctic”), both~~Arctic. Both the CQP and Giga Arctic are located in Mo i Rana, Norway. We have also started the development of our first clean battery cell manufacturing project in the U.S. (“Giga America”), which is located on a 368-acre parcel of land in Coweta County, Georgia that was purchased by the Company in 2022. As of September 30, ~~2022,~~2023, we have not yet initiated commercial manufacturing or derived revenue from our principal business activities.

~~Business Combination~~

On January 29, 2021, FREYR AS, a private limited liability company organized under the laws of Norway (“FREYR Legacy”) and Alussa Energy Acquisition Corp., a Cayman Islands exempted company (“Alussa”), among others, entered into the Business Combination Agreement (the “BCA”) to effect a merger between the companies (the “Business Combination”). FREYR, a Luxembourg public limited liability company was formed to complete the Business Combination and related transactions and carry on the business of FREYR Legacy. FREYR serves as the successor entity to FREYR Legacy, the predecessor entity.

The merger was completed in multiple stages, pursuant to the terms of the BCA, which included among other things, the transfer of FREYR Legacy’s wind farm business to Sjonfjellet Vindpark Holding AS (“SVPH”), resulting in SVPH shares being held by FREYR Legacy’s shareholders. On July 8, 2021, FREYR’s ordinary shares and warrants began trading on the New York Stock Exchange. On July 9, 2021, FREYR completed the Business Combination with FREYR Legacy and Alussa. In connection with the consummation of the transactions contemplated by the BCA, FREYR Legacy and Alussa became wholly owned subsidiaries of FREYR.

The Business Combination was accounted for as a reverse recapitalization. Under this method of accounting, Alussa was treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the following factors: (i) FREYR Legacy’s existing operations comprised the ongoing operations of the combined company, (ii) FREYR Legacy’s senior management comprised the senior management of the combined company and (iii) no shareholder had control of the board of directors or a majority voting interest in the combined company. In accordance with guidance applicable to these circumstances, the Business Combination was treated as the equivalent of FREYR issuing shares for the net assets of Alussa, accompanied by a recapitalization. The net assets of Alussa were stated at historical cost, with no goodwill or other intangible assets recorded.

As a result, the condensed consolidated financial statements included herein reflect (i) the historical operating results of FREYR Legacy prior to the Business Combination, (ii) the combined results of FREYR, FREYR Legacy and Alussa following the closing of the Business Combination, (iii) the assets and liabilities of FREYR Legacy at their historical cost, (iv) the assets and liabilities of FREYR and Alussa at their historical cost, which approximates fair value, and (v) FREYR’s equity structure for all periods presented.

~~In accordance with Accounting Standards Codification (“ASC”) 805,~~ ~~Business Combinations~~, guidance applicable to these circumstances, the equity structure has been restated in all comparative periods up to the closing date, to reflect the number of shares of FREYR’s ordinary shares issued to FREYR Legacy’s shareholders in connection with the recapitalization transaction. As such, the shares and corresponding capital amounts and earnings per share related to FREYR Legacy’s ordinary shares prior to the Business Combination have been retroactively restated as shares reflecting the exchange ratio established in the Business Combination.

Basis of Presentation

The unaudited condensed consolidated interim financial statements have been prepared in conformity with the accounting principles generally accepted in the ~~United States~~U.S. (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of ~~United States~~U.S. Securities and Exchange Commission (“SEC”) Regulation S-X. Accordingly, these financial statements do not include all of the information required by U.S. GAAP for complete consolidated financial statements.

The unaudited ~~interim~~ condensed consolidated interim financial statements have been prepared on the same basis as the audited annual consolidated financial statements for the year ended December 31, ~~2021~~2022 and, in management’s opinion, include all adjustments, consisting of only normal recurring adjustments necessary for the fair presentation of the Company’s condensed consolidated financial statements for the periods presented. The results of operations for the nine months ended September 30, ~~2022,~~2023, are not necessarily indicative of the results to be expected for the full year ending December 31, ~~2022.~~2023. The condensed consolidated balance sheet as of December 31, ~~2021,~~2022, was derived from the audited consolidated financial statements as of December 31, ~~2021.~~2022. However, these ~~interim~~ condensed consolidated interim financial statements do not contain all of the footnote disclosures from the annual consolidated financial statements. These unaudited condensed consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements and the related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021~~2022 filed with the SEC on ~~March 9, 2022.~~February 27, 2023.

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

The condensed consolidated financial statements include the accounts of FREYR, ~~and~~ its wholly owned ~~subsidiaries. All intercompany accounts~~subsidiaries, majority-owned subsidiaries, and ~~transactions have been eliminated.~~variable interest entities (“VIE”) of which we are the primary beneficiary. Certain prior period balances and amounts have been reclassified to conform with the current ~~year~~year’s presentation.

Use of Estimates

The preparation of the condensed consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the condensed consolidated financial statements and accompanying notes. Estimates and assumptions include, but are not limited to, estimates related to the valuation of warrant liability, share-based compensation, ~~warrant liability,~~ and the convertible note. We base these estimates on historical experiences and on various other assumptions that we believe are reasonable under the circumstances, however, actual results may differ materially from these estimates.

Risks and Uncertainties

We are subject to those risks common to our business and industry and also those risks common to early stage development companies. These risks include those disclosed in Part I, Item 1A, of our Annual Report on Form 10-K for the year ended December 31, ~~2021~~2022 filed with the SEC on March 9, 2022 and Part II, Item 1A, of our Quarterly Report on Form 10-Q for the period ended March 31, 2022. As of the date of this report, our existing cash resources, which were primarily provided as a result of the business combination, are sufficient to support our planned operations for at least the next 12 months. Therefore, ourFebruary 27, 2023.

These financial statements have been prepared ~~on the~~by management in accordance with U.S. GAAP and this basis assumes that we will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of the date of this report, our existing cash resources, which were primarily provided as a result of our business combination with Alussa Energy Acquisition Corporation in 2021 and issuance of equity securities, are sufficient to support our planned operations for at least the next 12 months from the date of issuance of these financial statements. Therefore, our financial statements have been prepared on the basis that we will continue as a going concern.

Restricted Cash

~~2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~Certain cash balances are restricted as to withdrawal or use. Restricted cash primarily consists of the balance of an account held for the construction of Giga Arctic. Additionally, restricted cash includes funds held in a restricted account for the payment of upfront rental lease deposits and government income tax withholdings.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Significant Accounting Policies

The Company’s significant accounting policies were included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022. Supplemental accounting policy disclosures are included ~~below.~~

~~Restricted Cash~~

~~Restricted cash consists of funds held in a restricted account for payment of upfront rental lease deposits and income tax withholdings to the Norwegian government, payable every other month.~~

~~Leases~~

A lease is a contract, or part of a contract, that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Lease classification as short-term lease, operating lease or finance lease is made at the lease inception. The Company considers all relevant contractual provisions, including renewal and termination options, to determine the term of the lease. Renewal or termination options that are reasonably certain of exercise by the lessee and those controlled by the lessor are included in determining the lease term. The Company has made an accounting policy election to present the lease and associated non-lease operations as a single component based upon the predominant component.

The Company made an accounting policy election not to recognize a right-of-use asset and lease liability for short-term leases with an initial term of 12 months or less, therefore these leases are not recorded on the condensed consolidated balance sheets. Expenses for short-term leases are recognized on a straight-line basis over the lease term in the consolidated statements of operations and comprehensive loss.

The Company recognizes lease liabilities and right-of-use assets for all operating and finance leases for which it is a lessee at the lease commencement date. Lease liabilities are initially recognized at the present value of the future lease payments during the expected lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate, based on the information available at the lease commencement date, in determining the present value of lease payments. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. The right-of-use asset is initially recognized at the amount of the initial measurement of the lease liability, plus any lease payments made at or before the commencement date, less any lease incentives received, and any initial direct costs incurred by the Company. Right-of-use assets are recorded as other long-term assets in the consolidated balance sheets. Subsequent to initial recognition, the right-of-use asset is reflected net of amortization. Costs to get a leased asset to the condition and location necessary for its intended use are capitalized as leasehold improvements.

The Company remeasures its lease liabilities with a corresponding adjustment to the right-of-use asset due to an applicable change in lease payments such as those due to a lease modification not accounted for as a separate contract, certain changes in the expected term of the lease, and certain changes in assessments and contingencies. Subsequent to initial recognition, the operating lease liability is increased for the interest component of the lease liability and reduced by the lease payments made. Operating lease expenses are recognized as a single lease cost in the consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term, which includes the interest component of the measurement of the lease liability and amortization of the right-of-use asset.

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

~~Adoption of Accounting Pronouncements~~

~~In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12,~~ ~~Income Taxes (ASC 740): Simplifying the Accounting for Income Taxes~~, which removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve the consistent application. We adopted this guidance as of January 1, 2022. Adoption of the standard did not have a material impact on the condensed consolidated financial statements.

~~In February 2016, the FASB issued ASU No. 2016-02,~~ ~~Leases (ASC 842)~~, as amended, which generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. We adopted this guidance as of January 1, 2022, on a modified retrospective basis and thus did not restate comparative periods. As a result, the comparative financial information and the required disclosures prior to the date of adoption have not been updated and continue to be reported under the accounting standards in effect for those periods. We elected the package of practical expedients permitted under the transition guidance, which allows us to carry forward our historical lease classification, our assessment of whether a contract is or contains a lease, and our initial direct costs for any leases that existed before the adoption of the new standard. A description of our accounting policy and accounting methods elected, is included under “Leases” above. Our right-of-use assets and corresponding lease liabilities for operating lease liabilities at adoption were $9.9 million. There was no change to accumulated deficit as a result of adoption, and the implementation of this standard did not cause a material change in the Company’s operating expenses.

~~3. BUSINESS COMBINATION~~

As discussed in Note 1 - Business and Basis of Presentation, we completed the Business Combination on July 9, 2021. Immediately before the closing of the Business Combination, all outstanding redeemable preferred shares of FREYR Legacy were converted into ordinary shares of FREYR. Upon the consummation of the Business Combination, each share of FREYR Legacy issued and outstanding was canceled and converted into the right to receive 0.179038 ordinary shares in FREYR (the “Exchange Ratio”).

Upon the closing of the Business Combination, our articles of association were amended and restated to, among other things, increase the total number of authorized shares to 245,000,000 shares without par value.

In connection with the Business Combination, on January 29, 2021, Alussa and FREYR entered into separate subscription agreements with a number of investors (each a “Subscriber”), pursuant to which the Subscribers agreed to purchase, and FREYR agreed to sell to the Subscribers, an aggregate of 60,000,000 ordinary shares (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $600.0 million, in a private placement pursuant to the subscription agreements (the “PIPE Investment”). The PIPE Investment closed simultaneously with the consummation of the Business Combination.

The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, Alussa was treated as the “acquired” company for financial reporting purposes. See Note 1 - Business and Basis of Presentation for further details. Accordingly, for accounting purposes, the Business Combination was treated as the equivalent of FREYR issuing shares for the net assets of Alussa, accompanied by a recapitalization. The net assets of Alussa were stated at historical cost, with no goodwill or other intangible assets recorded.

4.2. PROPERTY AND EQUIPMENT, NET AND INTANGIBLE ASSETS, NET

Property and Equipment, net

Property and equipment, net consisted of the following (in thousands):


		September 30, 2022		December 31, 2021			September 30, 2023		December 31, 2022


Land						Land	$	44,326	$	44,326
Leasehold improvements						Leasehold improvements	26,464		21
Machinery and equipment						Machinery and equipment	5,094		61
Office equipment						Office equipment	2,684		2,532
Construction in progress	Construction in progress	$	88,879	$	20,017	Construction in progress	273,101		164,387
Office equipment and other		1,889		1,180
		90,768		21,197			351,669		211,327
Less: Accumulated depreciation	Less: Accumulated depreciation	(376)		(135)		Less: Accumulated depreciation	(2,281)		(550)
Total	Total	$	90,392	$	21,062	Total	$	349,388	$	210,777

Land consists of a 368-acre parcel of land in Coweta County, Georgia, which was purchased in 2022 for the development of Giga America. Leasehold improvements and machinery and equipment as of September 30, 2023 are largely related to the Company’s CQP in Mo i Rana, Norway. Construction in progress primarily includes costs related to the construction of the ~~CQP and~~ Giga Arctic facilities and ~~the related~~ production equipment for the CQP in Mo i Rana, Norway. Depreciation expense was ~~$0.3~~$1.1 million and $0.1 million for the three months ended September 30, 2023 and 2022, respectively, and $1.8 million and $0.3 million for the nine months ended September 30, 2023 and 2022, respectively.

Intangible Assets, net

Intangible assets, net consisted of the following (in thousands):


	As of September 30, 2023						As of December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
License	$	3,000	$	(150)	$	2,850	$	3,000	$	(37)	$	2,963

Intangible assets consist of a license to produce and ~~2021,~~sell lithium-iron phosphate cathode battery materials using Taiwan based Advanced Lithium Electrochemistry Co., Ltd.’s technology. The license has a 20-year useful life. Amortization expense was $38,000 and $113,000 for the three and nine months ended September 30, 2023, respectively, (no comparative amounts for the three and nine months ended September 30, 2022). Future annual amortization expense is ~~included~~estimated to be $150,000 for the full year 2023 and each of the next four years.

3. LONG-TERM INVESTMENTS

The Company’s equity investments consisted of the following (in thousands):


	September 30, 2023		December 31, 2022
Investment
Equity method investments:
Nidec Energy AS	$	1,447	$	—
Investments without readily determinable fair values:
24M preferred stock	21,028		—
Total Long-Term Investments	$	22,475	$	��

Equity Method Investments

In March 2023, the Company contributed $1.7 million to obtain a 33% equity interest in ~~general~~Nidec Energy AS (the “Nidec JV”), a joint venture with Nidec Europe BV (“Nidec”). The Nidec JV was formed to develop, manufacture, and ~~administrative expenses in~~sell battery modules and battery packs for industrial and utility-grade ESS applications. The Company determined that the ~~condensed consolidated statements of operations and comprehensive loss.~~ Nidec

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

JV was a VIE, and that the Company was not the primary beneficiary. Additionally, the Company is able to exercise significant influence but not control over the operating and financial policies of the Nidec JV. Therefore, the Company has recorded its investment in the Nidec JV as an equity method investment.

In October 2021, we formed a joint venture, with the purpose of advancing the development of clean battery cell manufacturing in the U.S. (the “U.S. JV”). At the time of this initial investment, the Company agreed to contribute $3.0 million for the initial costs related to developing the first gigafactory to project concept selection, and this contribution was made in January 2022. We held a 50% common stock ownership in the U.S. JV and utilized the equity method of accounting for the U.S. JV through October 2022. In November 2022, the Company contributed an additional $49.0 million to the U.S. JV, increasing the Company’s common stock ownership in the U.S. JV to 95%. The Company reevaluated its classification of the U.S. JV, which was determined to meet the characteristics of a VIE. The Company was deemed to be the primary beneficiary of the U.S. JV and began consolidating the U.S. JV in November 2022. During the nine months ended September 30, 2023, the Company made an additional $22.6 million contribution and increased its common stock ownership to 96%.

The Company recognized its share of net loss of equity method investee in the condensed consolidated statements of operations and comprehensive loss of $0.2 million related to the Company’s equity method investment in the Nidec JV and $1.1 million related to the Company’s equity method investment in the U.S. JV, for the nine months ended September 30, 2023 and 2022, respectively.

Equity Investments Without Readily Determinable Fair Values

On October 8, 2021, we invested in an unsecured convertible note receivable (the “Convertible Note”) from 24M Technologies, Inc. (“24M”), our battery platform technology licensor for our planned manufacturing facilities in Norway and the U.S. In December 2022, we signed a contract amendment that would result in the Convertible Note converting to preferred stock in March 2023 based on the contractual conversion price in the original contract. On March 24, 2023, we converted the Convertible Note to preferred stock of 24M. See Note 7 – Fair Value Measurement for further details.

The 24M preferred stock does not have a readily determinable fair value and does not provide the Company with control or significant influence. Therefore, the Company has elected to account for the 24M preferred stock under the measurement alternative, defined as cost, less impairment, adjusted for subsequent observable price changes. We assess relevant transactions that occur on or before the balance sheet date to identify observable price changes, and we regularly monitor these investments to evaluate whether there is an indication that the investment is impaired.

5.4. ACCRUED LIABILITIES AND OTHER

Accrued liabilities and other consisted of the following (in thousands):


		September 30, 2022		December 31, 2021
						September 30, 2023			December 31, 2022

Accrued purchases	Accrued purchases	$	20,528	$	8,165		Accrued purchases			$	12,065			$	34,932
Accrued payroll and payroll related expenses	Accrued payroll and payroll related expenses	10,437		6,476		Accrued payroll and payroll related expenses		12,347				12,936
Operating lease liabilities (Note 6)		3,061		—
Accrued other operating costs		—		436
Operating lease liabilities						Operating lease liabilities		3,212				3,257
Other current liabilities						Other current liabilities		169				321
Total	Total	$	34,026	$	15,077	Total		$	27,793			$	51,446

~~6. LEASES~~

We currently lease our corporate headquarters, the building for the CQP, the land for the Giga Arctic facilities, as well as other facilities and properties. Our leases have remaining lease terms of up to 50 years, some of which include options to extend the leases and some of which include options to terminate the leases at our sole discretion. ~~We do not assume renewals in our determination of the lease term unless the renewals are deemed to be reasonably assured. As of September 30, 2022, all of our leases are operating leases.~~

~~The components of lease liabilities included in our condensed consolidated balance sheet consisted of the following (in thousands):~~


	September 30, 2022


~~Accrued liabilities and other (Note 5)~~	$	~~3,061~~
~~Operating lease liability~~	~~9,933~~
~~Total~~	$	~~12,994~~

~~Components of lease expenses were as follows (in thousands):~~

Three months ended
September 30, 2022 Nine months ended
September 30, 2022
Operating lease cost $ 558 $ 1,577
Variable lease cost 65 167
Short-term lease cost 45 60
Total lease cost $ 668 $ 1,804

~~The remaining minimum lease payments due on our long-term leases are as follows (in thousands):~~

September 30,
2022

For the remainder of 2022 $ 900
2023 2,664
2024 1,740
2025 1,783
2026 1,778
Thereafter 18,173
Total undiscounted lease payments 27,038
Less: imputed interest (14,044)
Present value of lease liabilities $ 12,994

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

~~Weighted average remaining lease term and discount rate are as follows:~~


	September 30, 2022


~~Weighted-average remaining lease term (in years)~~	~~24.7~~
~~Weighted-average discount rate~~	~~6.93~~	%

~~Supplemental cash flow information related to leases were as follows (in thousands):~~


	Nine months ended September 30, 2022

~~Cash paid for amounts included in the measurement of lease liabilities~~
~~Operating cash flows~~	$	~~1,308~~
~~Lease liabilities arising from obtaining right-of-use assets~~	~~13,578~~

7.5. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

From time to time, we may be subject to legal and regulatory actions that arise in the ordinary course of business. The assessment as to whether a loss is probable or reasonably possible, and as to whether such loss or a range of such loss is estimable, often involves significant judgment about future events. Management believes that any liability ~~of ours~~ that may arise out of or with respect to these matters will not materially, adversely affect our condensed consolidated financial position, results of operations, or liquidity.

8.6. WARRANTS

Public and Private Warrants

As of September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, we had ~~24,625,000~~ 24.6 million warrants outstanding (the “Warrants”), consisting of ~~14,375,000~~14.6 million public warrants (the “Public Warrants”) and ~~10,250,000~~10.0 million private warrants (the “Private Warrants”). The Warrants entitle the holder thereof to purchase one of our ordinary shares at a price of $11.50 per share, subject to adjustments. The Warrants will expire on July 9, 2026, or earlier upon redemption or~~liquidation~~.

The Public and Private Warrants were exchanged for public and private warrants of Alussa as part of the Business Combination, as described in Note 3 – Business Combination. The Warrants are subject to the terms and conditions of the warrant agreement entered into between Alussa, Continental Stock Transfer & Trust Company, and FREYR (the “Amended and Restated Warrant Agreement”). liquidation.

We may call the Public Warrants for redemption once they become exercisable, in whole and not in part, at a price of $0.01 per Public Warrant, so long as we provide at least 30 days prior written notice of redemption to each Public Warrant holder, and if, and only if, the reported last sales price of our ordinary shares equals or exceeds $18.00 per share for each of 20 trading days within the 30 trading-day period ending on the third trading day before the date on which we send the notice

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

of redemption to the Public Warrant holders. We determined that the Public Warrants are equity classified as they are indexed to our ordinary shares and qualify for classification within shareholders’ equity. As such, the Public Warrants are presented as part of additional paid-in capital on the condensed consolidated balance sheets.

The Private Warrants are identical to the Public Warrants, except that so long as they are held by ~~the Sponsor~~a certain holder or any of its permitted transferees, the Private Warrants: (i) may be exercised for cash or on a cashless basis and (ii) shall not be redeemable by FREYR. We determined that the Private Warrants are not considered indexed to our ordinary shares as the holder of the Private Warrants impacts the settlement amount and ~~thus,~~therefore, they are liability classified. The Private Warrants are presented as warrant liability on the condensed consolidated balance sheets.

If Private Warrants are sold or transferred to another party that is not the specified holder or any of its permitted transferees, the Private Warrants become Public Warrants and qualify for classification within shareholders’ equity at the fair value on the date of the transfer. See also Note 97 – Fair Value Measurement.

EDGE Warrants

~~On March 1, 2019, FREYR Legacy entered into a consulting agreement~~As of September 30, 2023 and December 31, 2022, we had 2.2 million EDGE warrants outstanding and exercisable, which entitle the holder thereof to purchase one of our ordinary shares at the exercise price, subject to adjustments. The EDGE warrants consist of 1.5 million warrants with EDGE Global LLC (“EDGE”) for FREYR Legacy’s CEO and Chief Commercial Officer to be hired to perform certain services related to leadership, technology selection, and operational services (the “2019 EDGE Agreement”). FREYR Legacy issued 1,488,862 warrants to EDGE under the 2019 EDGE Agreement with a subscriptionan exercise price of $0.95 ~~per share and an expiration date of~~which expire on May 15, ~~2024.~~

~~On September 1, 2020, FREYR Legacy amended the 2019 EDGE Agreement, effective as of July 1, 2020 (the “2020 EDGE Agreement”). FREYR Legacy issued an additional 687,219~~2024 and 0.7 million warrants ~~to EDGE under the 2020 EDGE~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

~~Agreement~~ with an ~~initial subscription~~exercise price of ~~$0.99 per share,~~$1.22, which ~~was modified to $1.22 per share on September 25, 2020. The warrants vested over an eighteen months graded vesting period and~~ expire on September 30, 2025.

We determined that the EDGE ~~Warrants~~warrants are equity classified as they are indexed to our ordinary shares. Upon the consummation of the Business Combination on July 9, 2021, all unvested warrants under the 2019 and 2020 Edge Agreements vested immediately. As such, on July 9, 2021, compensation cost was recognized for the remaining unrecognized fair value of these awards.

9.7. FAIR VALUE MEASUREMENT

The following table sets forth, by level within the fair value hierarchy, the accounting of our financial assets and liabilities at fair value on a recurring basis according to the valuation techniques we use to determine their fair value (in thousands):

September 30, 2022 December 31, 2021
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets:
Convertible Note $ — $ — $ 20,498 $ 20,498 $ — $ — $ 20,231 $ 20,231
Liabilities:
Warrant Liabilities $ — $ — $ 94,712 $ 94,712 $ — $ — $ 49,124 $ 49,124

In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.


	September 30, 2023								December 31, 2022
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Convertible Note	$	—	$	—	$	—	$	—	$	—	$	—	$	19,954	$	19,954
Liabilities:
Warrant Liabilities	$	—	$	—	$	10,540	$	10,540	$	—	$	—	$	33,849	$	33,849

We measured our Private Warrants and the Convertible Note ~~as of September 30, 2022 and December 31, 2021~~ at fair value based on significant inputs not observable in the market, which caused them to be classified as Level 3 measurements within the fair value hierarchy. ~~The valuation of the Private Warrants and the Convertible Note~~These valuations used assumptions and estimates that we believed ~~would be made by~~ a market participant would use in making the same valuation. Changes in the fair value of the Private Warrants ~~related to updated assumptions and estimates~~ were recognized as a warrant liability fair value adjustment within the condensed consolidated statements of operations and comprehensive loss. Changes in the fair value of the Convertible Note ~~related to updated assumptions and estimates~~ were recognized as a convertible note fair value adjustment within the condensed consolidated statement of operations and comprehensive loss.

As of September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the carrying value of all other financial assets and liabilities approximated their respective fair values.

Private Warrants

The Private Warrants outstanding on September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, were valued using the Black-Scholes-Merton option pricing model. See Note 86 – Warrants above for further detail. Our use of the Black-Scholes-Merton option pricing model for the Private Warrants ~~as of September 30, 2022 and December 31, 2021,~~ required the use of subjective ~~assumptions:~~assumptions, including:

•The risk-free interest rate assumption was based on the ~~United States~~U.S. Treasury Rates ~~which was~~ commensurate with the contractual terms of the Private Warrants, which expire on the earlier of (i) five years after the completion of the Business Combination or July 9, 2026 and (ii) redemption or liquidation. An increase in the risk-free interest rate, in isolation, would increase the fair value measurement of the Private Warrants and vice versa.Warrants.

•The expected term was determined ~~to be 3.78 and 4.53 years as of September 30, 2022 and December 31, 2021, respectively, given~~based on the expiration date of the Private ~~Warrants as noted above. An increase in the expected term, in isolation, would increase the fair value measurement of the Private Warrants and vice versa.~~Warrants.

•The expected volatility assumption was based on the implied volatility from a set of comparable publicly traded companies as determined based on the size and ~~industry.~~ industry and the implied volatility of the publicly traded Public Warrants.

An increase in each of the risk-free interest rate, expected term, or expected volatility, in isolation, would increase the fair value measurement, and a decrease in each of these assumptions would decrease the fair value measurement, of the Private ~~Warrants and vice versa.~~Warrants.

Using this approach, an exercise price of $11.50 and a share price of ~~$14.24~~$4.89 and ~~$11.18~~$8.68 as of September 30, ~~2022~~2023 and December 31, ~~2021,~~2022, respectively, we determined that the fair value of the Private Warrants was ~~$94.7~~$10.5 million and ~~$49.1~~$33.8 million, respectively.

~~Convertible Note~~

As of September 30, 2022 and December 31, 2021, we had an investment in a convertible note from 24M that was fair valued pursuant to the election of the fair value option under ASC 825, Financial Instruments. See Note 14 – Convertible Note for further detail. The Company considers this to provide a more accurate reflection of the current economic environment of the instrument. The Convertible Note was valued using a scenario-based framework. This analysis assumed various scenarios that were weighted based on the likelihood of occurrence. Within each scenario, an income approach, specifically the discounted cash flow approach, was utilized based on the expected payoffs upon the event, the discount rate, and the expected timing and then the expected probability of occurrence was applied, all of which management determined

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

~~were significant assumptions. We noted that a change~~Convertible Note

On October 8, 2021, we invested $20.0 million in the ~~expected payoffs, discount~~Convertible Note and elected to account for the Convertible Note using the fair value option. The Convertible Note was scheduled to mature on October 8, 2024, carried an annual interest rate ~~timing,~~of 5%, and was convertible into common stock or ~~expected probability~~preferred stock at our option beginning on October 8, 2023 or automatically upon certain events. In December 2022, we signed a contract amendment that would result in ~~a change~~the Convertible Note converting to preferred stock in March 2023, based on the contractual conversion price in the original contract. We determined the fair value ~~ascribed to~~of the Convertible ~~Note.~~ Note, prior to its conversion to preferred stock of 24M. See Note 3 – Long-Term Investments for further details.

~~Redeemable Preferred Shares~~

On November 11, 2020, 7,500,000 redeemable preferred shares were issued, each with a nominal value of NOK 0.01 per share for an aggregate subscription amount of NOK 71.5 million ($7.5 million) to two affiliates of Alussa in exchange for a cash contribution of $7.5 million (the “Preferred Share Preference Amount”). Concurrently, FREYR Legacy issued 92,500,000 warrants that were subscribed together with the redeemable preferred shares and considered an embedded feature as they were not separately exercisable. On February 16, 2021, an additional 7,500,000 redeemable preferred shares were issued, each with a nominal value of NOK 0.01 per share for an aggregate subscription amount of NOK 64.1 million ($7.5 million) to three affiliates of Alussa in exchange for a Preferred Share Preference Amount of $7.5 million. As part of the Business Combination and after the Norway demerger, the FREYR Legacy preferred shares were repurchased by FREYR at an adjusted Preferred Share Preference Amount of $14.9 million and the holders received 1,489,500 ordinary shares of FREYR. Before settlement, the preferred shares wereThe Convertible Note was valued using a scenario-based ~~framework.~~framework, where the fair values determined in various scenarios were weighted based on the estimated probability of occurrence. Within each scenario, ~~an income approach, specifically the~~a discounted cash flow approach was utilized, taking the expected payoff for the event, and discounting it based on the expected ~~payoffs upon the conversion or redemption event, the estimated yield,~~timing and ~~the expected probability of occurrence, which we determined was~~ a ~~significant assumption. Prior to settlement, changes in the fair value~~discount rate. Each of the ~~redeemable preferred shares related to updated~~ assumptions ~~and estimates~~in this model were ~~recognized as redeemable preferred shares fair value adjustment within the consolidated statements~~considered significant assumptions.

Rollforward of ~~operations and comprehensive loss.~~Level 3 Fair Value

The changes in the Level 3 instruments measured at fair value on a recurring basis were as follows (in thousands):


		For the nine months ended September 30, 2022				For the nine months ended September 30, 2021
		Asset		Liability		Asset		Liability					For the nine months ended September 30, 2023
		Convertible Note		Private Warrants		Convertible Note		Private Warrants		Redeemable Preferred Shares			Asset		Liability
													Convertible Note		Private Warrants
Balance (beginning of period)	Balance (beginning of period)	$	20,231	$	49,124	$	—	$	—	$	7,574	Balance (beginning of period)	$	19,954	$	33,849
Additions		—		—		—		27,265		7,500

Fair value measurement adjustments	Fair value measurement adjustments	267		45,588		—		11,173		(74)		Fair value measurement adjustments	1,074		(23,248)
Foreign currency exchange effects		—		—		—		—		—
Settlements		—		—		—		—		(15,000)

Conversion to preferred stock												Conversion to preferred stock	(21,028)		—
Reclassification to Public Warrants												Reclassification to Public Warrants	—		(61)
Balance (end of period)	Balance (end of period)	$	20,498	$	94,712	$	—	$	38,438	$	—	Balance (end of period)	$	—	$	10,540

~~10.~~8. SHAREHOLDERS' EQUITY

Ordinary Shares

As of both September 30, ~~2022~~2023 and December 31, ~~2021, 245,000,000~~2022, 245.0 million ordinary shares without par value were authorized and ~~116,703,504 an~~139.7 million ~~d 116,853,504~~were outstanding. On issuance of shares, amounts designated by our Board of Directors as share capital are included as ordinary ~~shares were outstanding~~share capital and any remaining proceeds are shown as ~~of September 30, 2022 and December 31, 2021, respectively.~~additional paid-in capital in our condensed consolidated balance sheets. Holders of ordinary shares are entitled to one vote per share and ~~are entitled~~ to receive dividends when, as, and if, declared by our Board of Directors. As of September 30, ~~2022,~~2023, we have not declared any dividends.

In December 2022, FREYR closed a public offering of 23.0 million ordinary shares at an offering price of $11.50 per share for total gross proceeds of approximately $264.5 million.

Share Repurchase Program

In May 2022, the ~~board~~Board of ~~directors~~Directors approved a share repurchase program (the “Share Repurchase Program”). The shares purchased under the program are to be used to settle the exercise of employee options granted under the Company’s equity compensation plans. We were authorized to repurchase up to 150,000 of the Company’s ~~Ordinary Shares, or approximately 0.13% of the current outstanding share capital.~~ordinary shares. The Share Repurchase Program had no time limit and was able to be suspended or discontinued at any time. We purchased 150,000 ordinary shares at an average price of $6.97 per share, excluding fees, during the nine months ended September 30, 2022. No purchases were made during the nine months ended September 30, ~~2022~~2023 ~~(no comparative amounts for the nine months ended September 30, 2021)~~. As of September 30, ~~2022,~~2023, the authorized share repurchase was completed and no ordinary shares remain available for repurchase under the program.

~~Employee Awards – 2019~~Share-Based Compensation

2021 Plan

~~FREYR Legacy had an~~In June 2021, we adopted the 2021 Equity Incentive ~~Stock Option~~ Plan (the ~~“2019~~“2021 Plan”) ~~issued on September 11, 2019. According~~, which was amended and restated in June 2023. The 2021 Plan provides for the grant of stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, performance units, and performance shares to ~~the 2019 Plan, options or warrants could be granted to eligible~~our employees, directors, and ~~a total of 895,190 ordinary shares could be issued. On December 1, 2020, the board of directors increased the number of ordinary shares available under the 2019 Plan by 895,190 ordinary shares.~~

~~As a result of the consummation of the Business Combination on July 9, 2021, the~~consultants. Generally, our stock options and ~~warrants~~RSUs vest annually over three years and ~~performance~~our stock options are exercisable over a maximum period of five years from their grant dates. Options are typically forfeited when the employment relationship ends for employees and ~~warrants already granted or earmarked~~they do not typically forfeit for ~~an employee’s first year of employment vested immediately. As such,~~directors. Generally, our RSUs are liability-classified awards, as they are cash settled based on ~~July 9, 2021, share-based compensation was recognized for~~ the ~~remaining unrecognized fair value~~closing price of the ~~2019 Plan awards. Effective as~~shares on the vesting date. All exercised options are expected to be settled in shares, net of ~~the close of the Business Combination, the 2019 Plan was modified to require cash-~~shares

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

~~settlement after~~withheld to satisfy the award exercise price and related taxes. As of September 30, 2023, a ~~lock-up period~~total of ~~either (i) one year~~25.0 million shares were authorized for ~~all non-executive~~issuance to satisfy share-based compensation awards made under the 2021 Plan.

During the nine months ended September 30, 2023, 4.6 million options were granted to employees ~~or (ii) two years for all executive employees.~~and directors, 116,000 RSUs were granted, 176,000 options were forfeited, and 20,000 RSUs vested and were cash settled.

2019 Plan

The 2019 Incentive Stock Option Plan (the “2019 Plan”) was issued on September 11, 2019. All stock options and warrants granted under the 2019 Plan are fully vested and no further awards can be issued. Outstanding awards under the 2019 Plan are required to be cash settled. The awards granted under the 2019 Plan are liability-classified awards, and as such, these awards are remeasured to fair value at each reporting date with changes to the fair value recognized as stock compensation expense in general and administrative expense or research and development expense within the condensed consolidated statements of operations and comprehensive loss. Cumulative stock compensation expense cannot be reduced below the grant date fair value of the original award.

~~During the nine months ended September 30, 2022, 300,352 of the 2019 Plan awards were exercised.~~

~~Employee Awards – 2021 Plan~~

We have a Long-Term Incentive Plan (the “2021 LTIP”) that was issued on July 9, 2021. According to the 2021 LTIP, at the discretion of our board of directors, but at least on an annual basis, stock options may be granted to eligible employees and directors. The aggregate number of additional shares authorized under the 2021 LTIP is not to exceed 10% of the current number of issued shares over the subsequent five years, excluding any options or warrants granted prior to the 2021 LTIP.

All options and restricted stock units (“RSUs”) granted under the 2021 LTIP vest annually in equal thirds and options can be exercised up to five years after the grant date. There are no performance or market conditions for vesting. During the nine months ended September 30, ~~2022, 3.8 million options~~2023, 9,000 of the 2019 Plan awards were ~~granted to employees and directors, 81,191 RSUs were granted, and 166,777 options were forfeited.~~ exercised.

2021 CEO Option Awards

On June 16, 2021, our then Chief Executive Officer (“CEO”), Tom Einar Jensen, entered into a stock option agreement, as an appendix to an employment ~~agreement, effective upon the consummation of the Business Combination.~~agreement. In accordance with the stock option agreement, on July 13, 2021 ~~our CEO~~Mr. Jensen was granted 850,000 options to acquire our shares at an exercise price of $10.00 (the ~~“CEO Option Awards”~~“2021 CEO Options”). The 2021 CEO ~~Option Awards are~~Options were subject to nine separate performance criteria, each of which iswas related to 1/9th9th of the total award amount. ~~If any~~As of December 31, 2022, one performance criteria for 94,000 of the 2021 CEO Options was deemed achieved by the Board of Directors. During the second quarter of 2023, the Board of Directors evaluated the remaining performance conditions and awarded full or pro-rata achievement for 567,000 of the remaining 756,000 options, which reflected adjustments to certain of the performance ~~criteria are achieved and certified by~~criteria. This is expected to result in an incremental compensation cost of $1.0 million to be recognized over the ~~board of directors during their first quarter 2022 meeting, the corresponding awards will~~award's remaining requisite service period. The 94,000 options vest in equal ~~thirds~~parts on December 31, 2022, September 30, 2023, and June 1, ~~2024. If achieved~~2024 and ~~certified during~~ the ~~first quarter 2023 meeting, the awards will~~567,000 options vest in equal ~~halves~~parts on September 30, 2023 and June 1, 2024. ~~Compensation cost is recognized to~~

9. GOVERNMENT GRANTS

For the ~~extent that achievement of the performance criteria is deemed probable.~~ ~~During the~~three and nine months ended September 30, ~~2022, 94,444~~2023 we recognized grant income of ~~the CEO Option Awards were deemed probable.~~

~~11. GOVERNMENT GRANTS~~

~~On February 12, 2021, we were awarded a grant of NOK 39.0~~less than $0.1 million ~~($4.6~~and $0.2 million, ~~based on NOK/USD exchange rate at the time of the transaction) for research, development, and innovation~~respectively, in environmental technology. The grant was awarded to assist with the costs incurred associated with employees and staff, contract research and consultants, overhead and operating expenses and intellectual property, patents, and licenses. The grant is paid out in three installments based on meeting certain milestones in the agreement, in which the last milestone is payable after the final project report is approved. The grant is subject to meeting certain business size thresholds and conditions, such as documenting and supporting costs incurred, obtaining a third-party attestation of our related records, and implementing policies that demonstrate good corporate governance. For the portion of any grant received for which costs have not yet been either incurred or supported through the appropriate documentation, we recognize deferred income in the condensed consolidated balance sheets. The first milestone of 30% and the second milestone of 50% were met during 2021 and payment was received. However, as of September 30, 2022, the appropriate documentation of the financing of project costs and third-party attestation had only occurred for the second milestone. As such, we recorded $1.3 million as of September 30, 2022 and $1.4 million as of December 31, 2021, as deferred income within the condensed consolidated balance sheet. For the nine months ended September 30, 2022 and 2021, no other income, ~~was recognized~~net within the condensed consolidated statements of operations and comprehensive ~~loss related to this grant.~~

~~On March 1, 2021,~~loss. For the three and nine months ended September 30, 2022 we ~~were awarded a~~recognized grant income of ~~NOK 142.0~~zero and $2.0 million, ~~($16.5 million based on NOK/USD exchange rate at~~respectively, in other income, net within the ~~time~~condensed consolidated statements of ~~the transaction) for the development~~operations and construction of the pilot plant in Mo i Rana, Norway. The grant was awarded to assist with the costs incurred associated with the pilot plant including research and development, general and administrative, and construction in progress. The grant is paid in arrears upon request based on progress and accounting reports with the last milestone becoming payable after the final project report is approved. The grant is subject to achieving successful financing of the pilot plant and other conditions, such as documenting and supporting costs incurred and obtaining a third-party attestation of our related records.comprehensive loss. For the nine months ended September 30, 2022, we ~~satisfied the requirements for payments totaling $11.9 million~~recorded grant income of ~~which $1.4 million related to costs which were expensed and were recognized as other income and~~ $10.5 million, ~~related to costs which were capitalized and were recognized~~ as a reduction of property and equipment, net on our condensed consolidated balance sheets, as these grants partially offset capitalized costs related to the ~~carrying amount~~construction in progress for the CQP. There was no grant income recorded as a reduction of property and equipment, net for the other periods presented.

As of both September 30, 2023 and December 31, 2022, we had $0.2 million in short-term deferred income from grants recorded in accrued liabilities and other on our condensed consolidated balance sheets. As of September 30, 2023 and December 31, 2022, we had $27.0 million and zero, respectively, in long-term deferred income from grants recorded in other long-term liabilities on our condensed consolidated balance sheets.

Significant Grant Awards

In February 2023, we received $20.0 million for a jobs creation grant in connection with the Giga America project. The grant is subject to the achievement of certain job creation targets by December 2025 and December 2029, with any required refund based on the proportion of job creation conditions that were not achieved. The proceeds will be recognized in other income, net on a straight-line basis over the grant term, for the portion of the ~~CQP’s construction~~grant that is reasonably assured of being retained.

In August 2023, we received $7.0 million for a job creation and capital investment grant in ~~progress.~~ connection with the Giga America project. The grant is subject to the achievement of certain job creation and capital investment targets within 84 months from the earlier of the date of FREYR’s certified occupancy of the Giga America facility or January 1, 2026. The proceeds will be allocated by activity and recognized in other income, net or as a reduction of property and equipment, net, as applicable, for the portion of the grant that is reasonably assured of being retained.

For the three and nine months ended September 30, ~~2021,~~2023, no amounts ~~were~~have been recognized ~~in relation to this grant.~~for grants on the Giga America project. As of September 30, 2023, unearned proceeds of $27.0 million are presented as other long-term liabilities on the condensed consolidated balance sheet.

~~12.~~10. INCOME TAXES

The provision for income taxes is recorded at the end of each interim period based on the Company’s best estimate of its effective income tax rate expected to be applicable for the full fiscal year. ~~There is no provision for income taxes because the~~The Company has incurred ~~operating~~taxable losses in each year since ~~inception. The Company’s effective income~~inception, and maintains a full valuation allowance against its loss carryforwards and other deferred tax ~~rate~~

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

assets. The Company and certain of its operating subsidiaries generate taxable income in certain jurisdictions or taxable foreign company U.S. sourced income. The Company’s effective income tax rate was 0% and 1% for the three and nine months ended September 30, ~~2022~~2023, respectively, and ~~2021 as~~0% for both the ~~Company continues to maintain a full valuation allowance against its deferred tax assets.~~three and nine months ended September 30, 2022.

~~13.~~11. RELATED PARTY TRANSACTIONS

~~EDGE~~Consulting Agreements

~~The 2020 EDGE Agreement provided that FREYR Legacy should pay EDGE~~In May 2021, we entered into a monthly retainer fee. Additionally, FREYR Legacy agreed to make certain milestone payments to EDGE based on the closing of certain additional financing rounds as defined within the 2020 EDGE Agreement. See Note 10 – Shareholders' Equity for further discussion on the warrant agreements between FREYR Legacy and EDGE. On January 18, 2021, the board resolved to terminate the 2020 EDGE Agreement and enter into an employment contract with the continuing CEO and a consulting contract with the prior Chief Commercial Officer, subject to the closing of the Business Combination. See below for further detail on the consulting agreement with a member of the ~~prior Chief Commercial Officer.~~

Board of Directors for a term of three years. In August 2023, we entered into a consulting agreement with another member of the Board of Directors for a one-year term. We pay both Board of Director consultants a monthly fee of $30,000 plus related reimbursable costs. The expenses incurred ~~in relation to the~~for these consulting services ~~provided~~ for the three and nine months ended September 30, ~~2021~~2023 were ~~$4.0~~$0.1 million and ~~$4.3~~$0.4 million, respectively. No expenses were recorded in the corresponding periods of 2022. These expenses are recognized as general and administrative expenses within the condensed consolidated statements of operations and comprehensive loss. There was no unpaid amount in accounts payable and accrued liabilities – related party as of September 30, 2022 and December 31, 2021.

~~Consulting Agreement~~

Concurrent with the consummation of the Business Combination, we agreed to a consulting agreement with the prior Chief Commercial Officer and current member of the board of directors. Per the consulting agreement, the consultant will provide services related to scaling sustainable energy storage, as well as any other services requested by us, for a term of three years. During this term, we will pay the consultant an annual fee of $0.4 million plus expenses. Per the agreement, the consultant is also entitled to participate in our benefit plans made available to our senior executives. The expenses incurred for these consulting services for the three and nine months ended September 30, 2022 were $0.1 million and $0.4 million, ~~respectively, and $0.1 million for both the three and nine months ended September 30, 2021.~~respectively. These expenses are recognized as general and administrative expenses ~~within~~in the condensed consolidated statements of operations and comprehensive loss. ~~The~~As of both September 30, 2023 and December 31, 2022, an unpaid amount of ~~less than~~ $0.1 million ~~was recognized~~is recorded in ~~accounts payable and~~ accrued liabilities -and other related ~~party as of September 30, 2022 and December 31, 2021.~~to these agreements.

Metier

In 2020, we entered into a framework agreement with Metier OEC, which provides primarily project management and administrative consulting services. The CEO of Metier, the successor company to Metier OEC, is the brother of our current Executive Vice President, Project Execution. ~~The expenses incurred for consulting services~~We recognized $0.7 million and $3.3 million for the three and nine months ended September 30, ~~2022 were $1.3 million and $4.1 million,~~2023, respectively, and ~~$1.1~~$0.9 million and $3.5 million for the three and nine months ended September 30, ~~2021, respectively. These expenses are recognized~~2022, respectively, as general and administrative expenses within the condensed consolidated statements of operations and comprehensive ~~loss. The unpaid amount of $0.7 million and $0.3 million was recognized in accounts payable and accrued liabilities - related party as of September 30, 2022 and December 31, 2021, respectively.~~

~~Equity Method Investment~~

We hold a 50% common stock ownership in a joint venture with Koch Strategic Platforms (“Koch”) that is accounted for under the equity method. The joint venture was formed in October 2021 to advance the development of clean battery cell manufacturing in the United States. As part of this agreement, both parties agreed to contribute $3.0 million for the initial costsloss related to ~~developing~~ the ~~first gigafactory to project concept selection,~~agreement with Metier. For the three and ~~these contributions were made in January 2022. Project concept selection remained under development as of September 30, 2022. The joint venture reported a net loss of $2.3 million for the~~ nine months ended September 30, ~~2022. For~~2023, $0.3 million and $1.5 million, respectively, and for the three and nine months ended September 30, 2022 ~~we recorded $1.1~~$0.4 million ~~of expenses related to~~and $0.6 million, respectively, met the ~~joint venture. There were no~~requirements for capitalization and are recognized as property and equipment within the condensed consolidated balance sheet. The unpaid amounts ~~due to the joint venture~~with Metier of $0.4 million and $0.7 million are recognized in accounts payable as of September 30, ~~2022~~2023 and in accrued liabilities and other as of December 31, ~~2021.~~2022, respectively.

~~14. CONVERTIBLE NOTE~~

On October 8, 2021, we invested $20.0 million in an unsecured convertible note receivable from 24M, our battery platform technology licensor for our current planned manufacturing facilities in Norway. The Convertible Note matures on October 8, 2024, carries an annual interest rate of 5%, and is convertible into common stock or preferred stock at our option beginning on October 8, 2023 or automatically upon a qualified initial public offering or direct listing in excess of our conversion price. Additionally, the Convertible Note contains a change of control provision that would result in repayment of 1.75x the note’s original investment value plus any accrued interest. We have elected to account for the Convertible Note using the fair value option. See Note 9 – Fair Value Measurement for details on the valuation methodology.

~~15.~~12. NET LOSS PER SHARE

The Company’s basic net loss per share attributable to ordinary shareholders ~~for the three and nine months ended September 30, 2022 was computed by dividing net loss attributable to ordinary shareholders by the weighted-average ordinary shares outstanding.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

For the three and nine months ended September 30, 2021, we computed net loss per share using the two-class method required for participating securities. Under the two-class method, undistributed earnings for the period are allocated to participating securities, including the redeemable preferred shares that were settled as part of the Business Combination, based on the contractual participation rights of the security to share in the current earnings as if all current period earnings had been distributed. As there was no contractual obligation for the redeemable preferred shares to share in losses, our basic net loss per share attributable to ordinary shareholders for the three and nine months ended September 30, 2021, was computed by dividing net loss attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding.

~~No dividends were declared or paid for the nine months ended September 30, 2022 and 2021.~~

Diluted net loss per share attributable to ordinary shareholders adjusts basic net loss per share attributable to ordinary shareholders to give effect to all potential ordinary shares that were dilutive and outstanding during the period. ~~For the nine months ended September 30, 2022 and 2021, the~~The treasury stock method was used to assess our warrants and share-based payment ~~awards while the if-converted method was used to assess our redeemable preferred shares.~~awards.

The ~~following table sets forth the~~ computation of ~~our~~ basic and diluted net loss ~~per share~~ attributable to ordinary shareholders ~~for the three and nine months ended September 30, 2022 and 2021~~per share is as follows (in thousands, except per share data):


		Three months ended September 30,				Nine months ended September 30,
		2022		2021		2022		2021			Three months ended September 30,				Nine months ended September 30,
											2023		2022		2023		2022
Numerator:	Numerator:									Numerator:
Net loss attributable to ordinary shareholders – basic and diluted		$	(93,850)	$	(45,419)	$	(124,086)	$	(65,342)
Net loss attributable to ordinary shareholders per share - basic and diluted										Net loss attributable to ordinary shareholders per share - basic and diluted	$	(9,785)	$	(93,850)	$	(47,793)	$	(124,086)
Denominator:	Denominator:									Denominator:
Weighted average ordinary shares outstanding – basic and diluted	Weighted average ordinary shares outstanding – basic and diluted	116,704		108,713		116,795		61,467		Weighted average ordinary shares outstanding – basic and diluted	139,705		116,704		139,705		116,795

Net loss per ordinary share:
Net loss attributable to ordinary shareholders per share:										Net loss attributable to ordinary shareholders per share:
Basic and diluted	Basic and diluted	$	(0.80)	$	(0.42)	$	(1.06)	$	(1.06)	Basic and diluted	$	(0.07)	$	(0.80)	$	(0.34)	$	(1.06)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The ~~following table discloses the~~ outstanding securities that could potentially dilute basic net loss attributable to ordinary shareholders per share in the future that were not included in the computation of diluted net loss attributable to ordinary shareholders per share, as the impact would be anti-dilutive, are as follows (in thousands):


		Three months ended September 30,		Nine months ended September 30,
		2022	2021	2022	2021		Three months ended September 30,		Nine months ended September 30,
							2023	2022	2023	2022
Public Warrants	Public Warrants	14,375	14,375	14,375	14,375	Public Warrants	14,625	14,375	14,625	14,375
Private Warrants	Private Warrants	10,250	10,250	10,250	10,250	Private Warrants	10,000	10,250	10,000	10,250
EDGE warrants	EDGE warrants	2,176	2,176	2,176	2,176	EDGE warrants	2,176	2,176	2,176	2,176
Employee awards						Employee awards	10,252	5,697	10,252	5,697
Share-based compensation liability awards (1)	Share-based compensation liability awards (1)	567	—	567	—	Share-based compensation liability awards (1)	—	567	—	567
Employee awards		5,697	3,358	5,697	3,358
RSUs		81	—	81	—
CEO option awards (2)		94	—	94	—
Other nonemployee warrants		—	413	—	413
2021 CEO option awards (2)						2021 CEO option awards (2)	661	94	661	94

Total	Total	33,240	30,572	33,240	30,572	Total	37,714	33,159	37,714	33,159

(1) ~~Share-based compensation liability awards exclude 140,597 of~~For the three and nine months ended September 30, 2023, the Company excluded the 668,000 total outstanding ~~707,532 option and warrant~~share-based compensation liability awards, as these awards are required to be ~~cash-settled due to~~cash-settled. For the ~~expiration~~three and nine months ended September 30, 2022, the Company excluded 141,000 of the ~~lock-up period specified in the BCA.~~708,000 total outstanding share-based compensation liability awards, as these awards are required to be cash-settled. See Note 108 – Shareholders' Equity for further details.

(2) For the three and nine months ended September 30, 2022, the Company excluded ~~755,556~~756,000 of the total 850,000 2021 CEO ~~Option Awards,~~option awards, as it iswas not yet probable that the performance conditions for these options ~~will~~would be achieved.

~~16. SUBSEQUENT EVENTS~~

~~Restricted Cash~~

In October 2022, an additional $133.8 million, or 32% of our September 30, 2022 cash and cash equivalents balance, was classified as restricted cash after the Company entered into contractual obligations with a contractor for the Giga Arctic construction.

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)~~

~~Giga America~~

On November 11, 2022, FREYR announced the launch of the Giga America clean battery cell manufacturing project in Coweta County, Georgia. Construction of Giga America is expected to take place in multiple phases. The first cell production module is expected to be approximately 34 GWh and will be established with the United States-based 24M production platform, which is intended to produce highly capital efficient and clean battery cells. FREYR made an additiona~~l $49.0 million capital contribution to its joint venture in the United States in November 2022, primarily to fund the land acquisition for Giga America and to take a controlling interest in the joint venture.~~

ITEM 2. ~~FREYR BATTERY’S~~ MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This ~~FREYR Battery’s “Management’s~~Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations”~~Operations should be read in conjunction with our condensed consolidated financial statements and the accompanying notes thereto contained in Part I, Item 1 “Financial Statements” and the other disclosures in this Quarterly Report on Form 10-Q and with the disclosures in our Annual Report on Form 10-K for the year ended December 31, ~~2021 and the unaudited interim condensed consolidated financial statements and the accompanying notes included as part of this Quarterly Report on Form 10-Q for the period ended September 30,~~ 2022. The financial information contained herein is taken or derived from such audited annual consolidated financial statements and unaudited interim condensed consolidated financial statements, unless otherwise indicated. The following discussion contains forward-looking statements and actual results could differ materially from those that are discussed in these forward-looking statements. See also “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in this Form 10-Q and our December 31, 2021 Annual Report on Form 10-K for more information on factors that could cause or contribute to such differences. Unless the context otherwise requires, all references in this section to “FREYR” refer to FREYR Legacy prior to the closing of the Business Combination and to FREYR Battery following the closing of the Business Combination.

Overview

We have put into service the buildings and infrastructure and certain manufacturing equipment at our Customer Qualification Plant (“CQP”). We are close to completing the construction of the initial buildings and ~~groundworks and foundation structures~~infrastructure for our ~~inaugural~~ gigafactory, (“Giga ~~Arctic”), both~~Arctic. Both the CQP and Giga Arctic are located in Mo i Rana, Norway. We have also started the development of our first clean battery cell manufacturing project in the U.S. (“Giga America”), which is located on a 368-acre parcel of land in Coweta County, Georgia that was purchased by the Company in 2022. We plan to reduce GigaArctic spending in 2024 in order to prioritize liquidity during the scale-up efforts at the CQP and to focus on opportunities to capture any incentives provided by the U.S. Inflation Reduction Act through the development of Giga America. We have updated our estimated timeline for automated customer testable battery production to beyond fiscal year 2023. As of September 30, ~~2022,~~2023, we have not yet initiated commercial manufacturing or derived revenue from our principal business activities.

~~Our initial CQP production line is based on our licensed SemiSolid~~TM technology and partnership with 24M Technologies (“24M”) and lithium-ion chemistry. Future development and expansion could incorporate alternative chemistry models and additional advances in battery technology both through our ongoing partnership with 24M, joint ventures, and licensing opportunities. We will initially target market opportunities in ~~energy storage systems (“ESS”), marine applications, commercial vehicles, and~~ ~~electric vehicles (“EV”)~~ ~~with high density and slower charge requirements, with plans to target additional markets, including faster charge battery cells for the broader consumer EV market.~~

~~We expect our capital and operating expenditures to increase significantly for the full year of 2022 and in 2023 in connection with our ongoing activities and to prepare for growth, as we:~~ Recent Developments

•~~Construct manufacturing facilities~~On August 10, 2023, FREYR announced the appointment of Birger Steen as the Chief Executive Officer (“CEO”) of the Company replacing Tom Einar Jensen effective August 21, 2023. Mr. Steen brings to FREYR his extensive experience as an executive and ~~purchase related equipment;~~

•~~Commercialize products;~~

•~~Make additional investments in technology;~~

•~~Maintain~~board member leading multinational and ~~improve operational, financial, and management information systems;~~

•~~Hire additional personnel; and~~

•~~Operate~~publicly listed companies. The Company also announced effective August 9, 2023, the appointment of Mr. Steen as a ~~public company.~~

~~Recent Developments~~Director and the appointment of Mr. Jensen as Executive Chair of the Company, replacing the retiring Co-founder and Executive Chair Torstein Sjøtveit. Mr. Jensen will provide transition support to Mr. Steen and will work closely with the leadership team to drive key global corporate development initiatives, capital formation, and engagement with FREYR’s capital providers based on a customer centric and partnership-oriented approach.

•On ~~November 11, 2022,~~September 5, 2023, FREYR announced the ~~launch~~expansion of its Energy Transition Acceleration Coalition (“ETAC”) to include SAP SE (FSE: SAP). SAP SE will join the ~~Giga America~~previously announced ETAC members Glencore Plc (LN: GLEN), Caterpillar Inc. (NYSE: CAT), Siemens AG (GY: SIE), and Nidec Corporation (TSE: 6594). ETAC is a collaborative alliance of global business partners focused on commercializing decarbonization solutions through clean battery cell manufacturing project in Coweta County, Georgia. Construction of Giga America is expected to take place in multiple phases. The first cell production module is expected to be approximately 34 GWh and will be established with the United States-based 24M production platform, which is intended to produce highly capital efficient and clean battery cells. FREYR made an additional $49.0 million capital contribution to its joint venture in the United States in November 2022, primarily to fund the land acquisition for Giga America and to take a controlling interest in the joint venture.

•In October 2022, FREYR signed a license and services agreement with Taiwan based Aleees. The agreement, which includes ongoing services and support from Aleees, provides FREYR with a worldwide license to produce and sell lithium-iron phosphate (“LFP”) cathode battery material based on Aleees’ technology and to build production facilities leveraging Aleees’ industrial experience. Aleees is an approved supplier of LFP cathode material to 24M and an established LFP cathode producer outside of mainland China. LFP cathode materials represent a significant component of the cost of a battery cell and the projected full-cycle supply chain carbon footprint of cells. Through this agreement and in cooperation with Aleees, FREYR is positioned to become a low cost and low carbon producer of LFP cathode material.deployment.

•In September ~~2022,~~and October 2023, FREYR ~~announced key contracts related to constructing~~ and ~~equipping~~ its ~~Giga Arctic manufacturing facility in Mo i Rana, Norway.~~wholly owned subsidiary, FREYR ~~signed an agreement with HENT AS~~Battery, Inc., a Delaware corporation (“HENT”) for the planning, project management, and construction of FREYR’s 120,000 square-meter Giga Arctic battery factory. HENT is one of Norway’s largest general contractors and project developers. FREYR ~~also~~Delaware”), entered into ~~an agreement~~a Common Draft Terms of Cross-Border Merger (projet commun de fusion transfrontalière) and a Merger Agreement by and between FREYR and FREYR Delaware as the next steps in connection with ~~Italy based NTE Process (“NTE”)~~FREYR’s previously announced plan to supply a complete and integrated drying and powder handling system to Giga Arctic. FREYR also awarded an agreement to UK based Mpac Group (“Mpac”) to provide production line equipment for automated casting and unit cell assemblyredomicile from Luxembourg to the ~~Giga Arctic project. Both~~U.S. as outlined in the Registration Statement on Form S-4, filed by FREYR Delaware with the U.S. Securities and Exchange Commission (the “SEC”) on September 8, 2023, as subsequently amended. We currently anticipate that the redomiciliation transaction will become effective in the fourth quarter of ~~these equipment suppliers are pre-qualified vendors of 24M~~2023, subject to obtaining shareholder approval at the extraordinary general meeting expected to occur on December 15, 2023 and ~~are currently supplying equipment for~~all the ~~CQP project.~~conditions precedent to the merger between FREYR and FREYR Delaware being satisfied or waived.

•In August 2022, FREYR executed a joint venture agreement with Nidec Corporation (“Nidec”), which included complete terms for a follow-on sales agreement, to supply 38 Gigawatt hours (“GWh”) of LFP Li-Ion battery cells from 2025 to 2030, with options to increase the volume to 50 GWh and to extend the contract beyond 2030. The joint venture will combine FREYR’s clean, next-generation battery cells with Nidec’s expertise as a global leader in the ESS business and will produce modules and packs and generate integrated downstream ESS solutions for industrial and utility grade customers. The battery cell sales agreement will be executed with the joint venture when it is incorporated.

•In August 2022, FREYR announced a strategic partnership with South Korea based Hana Technology Co. Ltd (“Hana Technology”) to jointly develop formation and aging, pouch assembly, and inspection and packaging equipment and automation solutions for FREYR’s planned gigafactories. This strategic alliance frame agreement will enable FREYR and Hana Technology to customize and co-develop solutions for the Giga Arctic.

•In August 2022, FREYR announced the establishment of two new technology centers in Japan and the United States, which will continue to enhance the Company’s global footprint. The technology resources campus and business unit in Fukuoka, Japan will focus on the facilitation and scale-up of FREYR’s testing and development of the 24M battery platform. The technology center in Boston, Massachusetts will support the Company’s expansion strategy to accelerate the development of the Company’s first United States gigafactory, Giga America, and to enhance technological development and strategic coordination with 24M.

•On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was signed into law in the United States. The IRA includes $369 billion in climate and energy-related provisions, including those to incentivize and accelerate the build out of renewable energy and accelerate the adoption of EV technologies. The IRA creates specific tax credit incentives for the manufacturing and production of battery cells, modules, and electrode materials in the United States, and extends the Investment Tax Credit to standalone battery storage technology projects for the first time without co-location requirements to solar or wind developments. The IRA will likely drive significantly lower battery costs and prices in the United States, potentially leading to a surge in domestic ESS activity. The benefits of the IRA support the Company’s acceleration of a potential investment in Giga America.

•In October 2022, FREYR announced a new service agreement with ITOCHU Corporation (“ITOCHU”), the Japan-based global trading and import/export company. As part of this agreement, ITOCHU will serve as a direct materials supplier for FREYR’s procurement and supply chain operations to secure the raw materials required for FREYR’s planned battery production at giga scale. Additionally, ITOCHU is an investor in 24M.

~~Comparability of Financial Information~~

Our results of operations and reported assets and liabilities may not be comparable between periods as a result of the Business Combination and becoming a public company. As a result of the Business Combination, we became a New York Stock Exchange (“NYSE”) listed company, which has required and will continue to require us to hire additional personnel and implement procedures and processes to address public company regulatory requirements and customary practices. We expect to incur additional annual expenses as a public company for, among other things, directors’ and officers’ liability insurance, director fees, internal and external accounting, legal and administrative resources, including increased audit, compliance, and legal fees.

~~Share Repurchase Program~~

In May 2022, the board of directors approved a share repurchase program (the “Share Repurchase Program”). The shares purchased under the program are to be used to settle the exercise of employee options granted under the Company’s equity compensation plans. We were authorized to repurchase up to 150,000 of the Company’s Ordinary Shares, or approximately 0.13% of the current outstanding share capital. The Share Repurchase Program had no time limit and was able to be suspended or discontinued at any time. We purchased 150,000 ordinary shares at an average price of $6.97 per share, excluding fees, during the ~~nine months ended September 30, 2022~~ (no comparative amounts for the nine months ended September 30, 2021). As of September 30, 2022, the authorized share repurchase was completed and no ordinary shares remain available for repurchase under the program.

Results of Operations

The following table sets forth ~~FREYR Battery’s~~information on FREYR’s condensed consolidated results of operations ~~data for the periods presented~~ (in thousands except percentages):


		Three months ended September 30,				Change (%)		Nine months ended September 30,				Change (%)
		2022		2021				2022		2021					Three months ended September 30,				Change (%)			Nine months ended September 30,						Change (%)
															2023		2022				2023			2022			Change (%)
Operating expenses:	Operating expenses:													Operating expenses:
General and administrative	General and administrative	$	25,124	$	30,057	(16	%)	$	77,888	$	46,245	68	%	General and administrative	$	27,772	$	25,124	11	%		$	85,405		$	77,888		10	%
Research and development	Research and development	3,253		5,257		(38	%)	9,194		11,209		(18	%)	Research and development	7,086		3,253		118	%		18,295			9,194			99	%
Equity in losses from investee		668		—		NM		1,131		—		NM
Share of net loss of equity method investee														Share of net loss of equity method investee	153		668		(77	%)		208			1,131			(82	%)
Total operating expenses	Total operating expenses	29,045		35,314		(18	%)	88,213		57,454		54	%	Total operating expenses	35,011		29,045		21	%		103,908			88,213			18	%
Loss from operations	Loss from operations	(29,045)		(35,314)		(18	%)	(88,213)		(57,454)		54	%	Loss from operations	(35,011)		(29,045)		21	%		(103,908)			(88,213)			18	%
Other income (expense)	Other income (expense)	(64,805)		(10,105)		541	%	(35,873)		(7,888)		355	%	Other income (expense)	25,007		(64,805)		(139	%)		55,939			(35,873)			(256	%)
Loss before income taxes	Loss before income taxes	(93,850)		(45,419)		107	%	(124,086)		(65,342)		90	%	Loss before income taxes	(10,004)		(93,850)		(89	%)		(47,969)			(124,086)			(61	%)
Income tax expense	Income tax expense	—		—		NM		—		—		NM		Income tax expense	—		—		NM			(341)			—			NM
Net loss	Net loss	$	(93,850)	$	(45,419)	107	%	$	(124,086)	$	(65,342)	90	%	Net loss	(10,004)		(93,850)		(89	%)		(48,310)			(124,086)			(61	%)
Net loss attributable to non-controlling interests														Net loss attributable to non-controlling interests	219		—		NM			517			—			NM
Net loss attributable to ordinary shareholders														Net loss attributable to ordinary shareholders	$	(9,785)	$	(93,850)	(90	%)		$	(47,793)		$	(124,086)		(61	%)


NM - Not meaningful

Operating expenses

General and administrative

General and administrative expenses consist of personnel and personnel-related expenses, including share-based compensation, fees paid for contractors and consultants assisting with growing the business, office space related costs, travel costs, public relations costs, legal fees, accounting and audit fees, and depreciation expense.

General and administrative expenses ~~decreased~~increased by ~~$4.9~~$2.6 million or ~~16%~~11%, to $27.8 million for the three months ended September 30, 2023, from $25.1 million for the three months ended September 30, ~~2022, from $30.1~~2022. General and administrative expenses increased by $7.5 million or 10%, to $85.4 million for the ~~three~~nine months ended September 30, ~~2021.~~ ~~This is primarily due to a decrease in compensation expense, largely attributable~~ ~~to the Business Combination in 2021. General and administrative expenses increased by $31.6 million or 68%, to~~2023, from $77.9 million for the nine months ended September 30, ~~2022, from $46.2 million for the nine months ended September 30, 2021.~~2022. This increase is primarily due to higher headcount and increased spending associated with the ~~ramp up~~ramp-up of activities as we continue to invest in building our business and move closer to the start-up of manufacturing operations. ~~Overhead~~

We have initiated a program to reduce costs ~~also increased due~~and reallocate resources in 2024 to better match our current priorities, as many of our long term priorities are subject to additional financing. However, expenses can vary from quarter to quarter, and our spending may change to match changing project configurations and timelines, and the ~~professional fees~~availability of project and other ~~costs related to operating as a public company, partially offset by a decrease in compensation expense as described above.~~ financing. See also “Financial Condition, Liquidity and Capital Resources” below.

We expect general and administrative expenses to increase for the foreseeable future as we scale headcount with the growth of our business, and as a result of increased expenses to operate as a public company, including compliance with the rules and regulations of the United States Securities and Exchange Commission, additional legal, audit, and insurance expenses, investor relations activities, and other administrative and professional services.

Research and development (“R&D”)

R&D expenses consist primarily of compensation to employees engaged in research and development activities, including share-based compensation, internal and external engineering, depreciation for R&D equipment and facilities, supplies and services, and contributions to research institutions. R&D expenses also include development costs related to our technology license with 24M.

R&D ~~expenses decreased~~expenses increased by ~~$2.0~~$3.8 million or ~~38%~~118% to $7.1 million for the three months ended September 30, 2023, from $3.3 million for the three months ended September 30, ~~2022, from $5.3~~2022. R&D expenses increased by $9.1 million or 99% to $18.3 million for the ~~three~~nine months ended September 30, ~~2021. R&D expenses decreased by $2.0 million or 18% to~~2023, from $9.2 million for the nine months ended September 30, ~~2022, from $11.2 million for the nine months ended September 30, 2021. This is~~2022. These increases are primarily due to ~~a decrease~~the startup of ~~$1.5 million~~R&D operations at the CQP late in ~~share-based compensation costs,~~ ~~largely attributable~~ ~~to employee options and warrants which vested immediately following~~ the ~~Business Combination in 2021~~second quarter of 2023.

~~We expect~~ R&D expenses ~~to increase~~ in future periods will be driven by increases in our technology personnel and research and development activities as we ~~increase~~invest to improve our ~~personn~~elproduction processes, efficiency, and ~~research activities.~~products and as we evaluate additional production and battery technologies in the normal course of business.

~~Equity in losses from~~Share of net loss of equity method investee

~~Equity in losses from~~Share of net loss of equity method investee consists of our proportionate share of the net earnings or losses and other comprehensive income from ~~our United States joint venture, which is accounted for under the equity method, as we exercise significant influence but not control, over its operating~~Nidec Energy AS in 2023 and ~~financial policies.~~ FREYR Battery US LLC in 2022.

~~Equity in losses from investee of $0.7 million and $1.1 million were~~ ~~recognized for the three and nine months ended September 30, 2022, respectively. There was no equity in losses from investee for the corresponding periods in 2021.~~

Other income (expense)

Other income (expense) primarily consists of the fair value adjustments on our warrant liability, convertible note, ~~redeemable preferred shares,~~ interest income and expense, net foreign currency transaction gains and losses, and grant ~~proceeds received.~~income.

Other income (expense) changed by $89.8 million or 139% to income of $25.0 million for the three months ended September 30, 2023, from expense ~~increased~~ ~~by $54.7 million to~~of $64.8 million for the three months ended September 30, ~~2022 from $10.1~~2022. The change is primarily due to the $24.4 million gain on warrant liability fair value adjustment for the three months ended September 30, ~~2021.~~ 2023, compared to a$70.3 million loss for the three months ended September 30, 2022.

Other income (expense) changed by $91.8 million or 256% to income of $55.9 million for the nine months ended September 30, 2023, from expense ~~increased by $28.0 million to~~of $35.9 million for the nine months ended September 30, ~~2022 from $7.9~~2022. Other income changed primarily due to a $23.2 milliongain on warrant liability fair value adjustment for the nine months ended September 30, ~~2021. The increase in other expense is primarily due~~2023, compared to ~~the $70.3 million and~~a $45.6 million loss onfor the ~~revaluation of the warrant liability recorded during the three and~~ nine months ended September 30, ~~2022 as~~2022. In addition, we recognized a ~~result of an increase in our stock price.~~ $20.5 million net foreign currency transaction gain for the nine months ended September 30, 2023, compared to a $5.4 million gain for the nine months ended September 30, 2022.

Financial Condition, Liquidity and Capital Resources

Liquidity and Capital Resources

As of September 30, ~~2022,~~2023, we had ~~approximately $418.6~~approximately $327.9 million of ~~cas~~h,cash, cash equivalents, and restricted cash and current liabilities of approximately ~~$47.2~~$48.4 million. Our restricted cash includes $27.5 million. held in escrow for planned construction activities of Giga Arctic in 2023. To date, our principal sources of liquidity have been proceeds received from ~~the Business Combination,~~our business combination with Alussa Energy Acquisition Corporation in 2021, issuance of equity securities, and amounts received from government grants. Historically, these funds have been used for constructing and equipping our battery manufacturing facilities, including the CQP and Giga Arctic, the purchase of land for Giga America, technology licensing, R&D activities, and general corporate purposes.

In December 2022, FREYR closed a public offering of 23.0 million ordinary shares at an offering price of $11.50 per share for total gross proceeds of approximately $264.5 million. In September 2022, FREYR filed a shelf registration statement on Form S-3 with the SEC, of which the December public offering is a part. Under this shelf registration statement, FREYR may, from time to time, sell up to an additional aggregate amount of approximately $235.5 million ordinary shares, preferred shares, debt securities, warrants, rights, and purchase units.

Our future liquidity requirements depend on many factors, including the timing and extent of the following: capital expenditures for construction of our battery manufacturing facilities and purchase of related ~~equipment,~~equipment; spending to support technology licensing and R&D ~~efforts,~~efforts; spending on other growth initiatives or expansion into new geographies, including through joint ventures; spending to support our future revenue generating activities, including market acceptance of our products and ~~services,~~services; and ~~overall~~general economic conditions.

Until we can generate sufficient revenue to adequately support our liquidity requirements, we expect to fund short-term cash needs through our existing cash balances. We believe that we have sufficient liquidity to meet our contractual obligations and commitments for at least the 12 months following September 30, ~~2022.~~2023.

Our long-term operating needs and planned investments in our business and manufacturing footprint, as currently devised, will require significant ~~financing.~~financing to complete. Such financing may not be available at terms acceptable to us, or at all. The credit market and financial services industry have in the past, and may in the future, experience periods of uncertainty that could impact the availability and cost of equity and debt financing. If we are unable to raise substantial additional capital, ~~in the near term,~~ our ability to invest in Giga Arctic, Giga America, and other gigafactories or development projects will be significantly delayed or curtailed which would have a material adverse impact on our business prospects and results of operations. If we raise funds by issuing debt securities, these debt securities would have rights, preferences, and privileges senior to those of holders of our ordinary shares. The terms of debt securities or other borrowings could impose significant restrictions on our operations. If we raise funds by issuing equity securities, dilution to stockholders may result. Any equity securities issued may also provide for rights, preferences, or privileges senior to those of holders of our ordinary shares.

In August 2022, the Company estimated its Giga Arctic facility to have a total cost of approximately $1.7 billion, using the configuration assumptions determined at that time. We are close to completing the construction of the initial buildings and infrastructure for Giga Arctic. FREYR has not yet committed additional material funds for the completion of the buildout and purchase of equipment in excess of the $27.5 million restricted cash held in escrow as of September 30, 2023, which is expected to be used to fund certain construction activities during the remainder of 2023. FREYR has elected to secure the Giga Arctic asset and minimize spending in 2024, instead prioritizing liquidity for scale-up efforts at the CQP and focusing spending on development of Giga America. Additional spending on Giga Arctic is pending continuing technology development and a competitive Norwegian regulatory response to the U.S. Inflation Reduction Act. The total cost to complete the construction and buildout of the Giga Arctic facility and the timing of cash requirements will depend on a variety of factors such as the ultimate configuration of the facility, including the number of production lines, the capacity of the facility, technology and product specifications, the form and amount of government grants and assistance, the availability, form, and additional requirements of project and other financing, and general economic conditions.

In November 2022, the Company estimated its Giga America facility to have an initial projected capital cost of approximately $1.7 billion. Since then, the Company has evaluated multiple configurations to achieve commercial production as quickly as possible. We have begun the development of Giga America but have not yet begun construction nor committed significant funds for the purchase of materials and equipment. Future development of Giga America could progress on one or both of two possible tracks. CQP performance, which is based on 24M technology, and the timing of delivery of testable batteries to our key stakeholders, and their acceptance of these batteries, could drive initial financing and development of Giga America. Conventional technology could provide an alternative or parallel path to accelerate Giga America development and timing. To this end, we are exploring potential conventional partnership opportunities that could complement the scale-up of the 24M platform along with multiple potential financing options, including government-sponsored grants and loans. The total cost of Giga America construction will continue to be refined, as decisions concerning technology and product specifications, timing of the start of construction, factory layout, and equipment purchases are finalized.

The estimated costs of constructing the Giga Arctic and Giga America facilities remain subject to technology and product specification decisions, ongoing business, financing, and operational changes, and changes to the overall macroeconomic environment. We will continue to provide updates to reflect material developments, including approvals or commitments for spending that differs materially from our previous estimates.

We are planning to reduce total cash spending by over 50% in 2024 as compared to 2023, in order to extend our liquidity runway to two plus years without any new project-level financing. We further expect to refrain from making significant capital expenditures during fiscal year 2024 until we have secured additional funding.

Our planned capital expenditures are based on management’s current estimates and may be subject to change. There can be no assurance that we will execute our capital expenditure plans as currently estimated, without addition, reduction, or modification. We may also from time to time reduce or increase planned spending on specific capital projects and/or adjust the timing of planned capital expenditures due to factors both within and outside of our control, including the availability of financing. As a result, actual capital expenditures in future years may differ materially from the amounts discussed above.

Cash Flow Summary

The following table summarizes our cash flows (in thousands):

Nine months ended
September 30, Change (%)
2022 2021
Net cash (used in) provided by:
Operating activities $ (72,993) $ (35,643) 105 %
Investing activities (70,226) (4,111) NM
Financing activities (1,052) 649,000 (100 %)


	Nine months ended September 30,				Change (%)
	2023		2022
Net cash used in operating activities	$	(53,978)	$	(72,993)	(26	%)
Net cash used in investing activities	(167,966)		(70,226)		139	%
Net cash used in financing activities	—		(1,052)		(100	%)


~~NM - Not meaningful~~

Operating Activities

Net cash used in operating activities was $54.0 million for the nine months ended September 30, 2023, compared to $73.0 million for the nine months ended September 30, ~~2022, compared~~2022. The decrease in cash used in operating activities was primarily due to ~~$35.6~~the receipt of $23.5 million for government grants in connection with the Giga America project for the nine months ended September 30, 2023.

Investing Activities

Net cash used in investing activities was $168.0 million for the nine months ended September 30, 2021. During the nine months ended September 30, 2022, the increase in cash used in operating activities was driven by a $31.9 million increase in net loss, adjusted for non-cash items. The increase in net loss, adjusted for non-cash items was primarily due2023, compared to ~~higher operating expenses from higher headcount~~

~~and increased spending associated with the ramp up of activities as we continue to invest in building our business and move closer to the start-up of manufacturing operations.~~

~~Investing Activities~~

~~Net cash used in investing activities was~~ $70.2 million for the nine months ended September 30, ~~2022, compared to $4.1 million for the nine months ended September 30, 2021.~~2022. The ~~change~~increase in cash used in investing activities was primarily driven by ~~$77.7~~$168.8 million in purchases of property and equipment for the nine months ended September 30, 2023, compared to ~~$4.1~~$77.7 million in the corresponding period in 2022, and lower proceeds from property related grants of $3.5 million for the nine months ended September 30, ~~2022 and 2021, respectively. In addition,~~2023 compared to $10.5 million in the corresponding period in 2022.

Financing Activities

Net cash used in financing activities was zero for the nine months ended September 30, 2022, we used $3.0 million in cash for an investment in our equity method investee in the United States and received proceeds of $10.5 million from grants funding our property and equipment construction.

~~Financing Activities~~

~~Net cash used in financing activities was~~2023, compared to $1.1 million ~~for the nine months ended September 30, 2022, compared to cash provided by financing activities of~~ ~~$649.0 million~~ for the nine months ended September 30, ~~2021.~~2022. Net cash used during 2022 was related to the purchase of treasury ~~shares. Net cash provided~~shares during ~~2021, consisted of net proceeds of $641.5 million from~~ the ~~Business Combination and~~ ~~$7.5 million~~ ~~in proceeds from the issuance of redeemable preferred shares.~~second quarter.

Critical Accounting Policies and Estimates

Our critical accounting policies and estimates are consistent with those described in the Management’s Discussion and Analysis section of our ~~December 31, 2021~~ Annual Report on Form ~~10-K.~~10-K for the year ended December 31, 2022 filed with the SEC on February 27, 2023. There have been no material changes to our critical accounting policies during the nine months ended September 30, ~~2022.~~

~~Recent Accounting Pronouncements~~2023.

~~See Note 2 to the condensed consolidated financial statements for information concerning new accounting standards and the impact of the implementation of these standards on our financial statements.~~

Emerging Growth Company Status

Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable.

We qualify as an emerging growth company, as defined in the JOBS Act, and therefore ~~intend~~may choose to take advantage of certain exemptions from various public company reporting requirements, including delaying the adoption of new or revised accounting standards until those standards apply to private companies. This may make a comparison of our condensed consolidated financial statements with another public company that is either not an emerging growth company or is an emerging growth company that has opted out of using the extended transition period, difficult or impossible because of the potential differences in accounting standards used. We expect that we will lose our emerging growth company status on December 31, 2023, at which point, we will qualify as a large accelerated filer based on our unaffiliated market capitalization as of June 30, 2023, according to Rule 12b-2 of the Securities Exchange Act of 1934, as amended.

ITEM 3. ~~QUALITATIVE~~QUANTITATIVE AND ~~QUANTITATIVE~~QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~FREYR is exposed to market risks arising from adverse~~There have been no material changes in ~~inflation and changing prices. This~~ market risk ~~is described further below. In addition, refer to~~from the ~~section entitled “Risk Factors”~~information provided in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in our Annual Report on Form 10-K for the ~~prospectus~~year ended December 31, 2022 filed by us pursuant to Rule 424(b)(3) on March 16, 2022 (the “Prospectus”), in the section entitled “Risk Factors” beginning on page 14, for additional discussion of these and other risks, including the potential risks associated with the ~~supply chain and the COVID-19 pandemic.~~

~~Currency Exchange Risk~~

We are exposed to currency risk from potential changes in currency values of our non-United States dollar denominated expenses, assets, liabilities, and cash flows. Our most significant currency exposure relates to the Norwegian Krone.SEC

~~Inflation Risk~~

Increases in raw material and building supply prices and increases in freight and logistics costs, including those from inflationary pressures or from supply chain constraints, may adversely impact FREYR’s costs and results of operations. Rising raw material costs, including steel and aluminum which saw significant price increases in 2021, may result in significant increases in costs from our suppliers and increased lead-times associated with our raw materials, particularly since we have not established fixed prices and volumes with a majority of our prospective suppliers. Increased costs of building supply costs may adversely impact the cost of construction of our buildings, equipment, and infrastructure for our CQP and Giga Arctic.

~~We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.~~on February 27, 2023.

ITEM 4. CONTROLS AND PROCEDURES

Limitations on Effectiveness of Controls and Procedures

We maintain disclosure controls and procedures (“Disclosure Controls”) within the meaning of Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized, and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms.

Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Group Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, ~~(as~~as defined in Rules 13a-15(e) and 15d-15(e) ~~under~~of the Exchange ~~Act),~~Act, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Evaluation of Disclosure Controls and Procedures

As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Group Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, ~~2022.~~2023. Based upon their evaluation, our Chief Executive Officer and Group Chief Financial Officer concluded that our disclosure controls and procedures, ~~(as~~as defined in Rules 13a-15(e) and 15d-15(e) ~~under~~of the Exchange ~~Act)~~Act, were effective.

Changes in Internal Control Over Financial Reporting

There ~~has been~~were no ~~change~~changes in our internal control over financial reporting, ~~(as~~as defined in Rules 13a-15(f) and 15d-15(f) ~~under~~of the Exchange ~~Act),~~Act, that occurred during the three months ended September 30, ~~2022~~2023 that ~~has~~have materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we may be involved in litigation relating to claims arising in the ordinary course of our business. To the knowledge of our management, there are no material litigation, claims, or actions currently pending or threatened against us, any of our officers, or directors in their capacity as such, or against any of our property.

ITEM 1A. RISK FACTORS

As of the date of this filing, there have been no material changes in our risk factors from those disclosed in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2021~~2022 filed with the U.S. Securities and Exchange Commission on ~~March 9, 2022, except as discussed in Part II, Item IA, of our Quarterly Report on Form 10-Q for the period ended March 31, 2022.~~February 27, 2023. Additional risks not currently known to us or that we currently deem to be immaterial may also materially affect our ~~consolidated~~ financial position, results of operations, or cash flows.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

As announced in the Company’s Current Report on Form 8-K filed with the SEC on June 13, 2022, in May 2022, the board of directors approved a share repurchase program (the “Share Repurchase Program”). The shares purchased under the program are to be used to settle the exercise of employee options granted under the Company’s equity compensation plans. We were authorized to repurchase up to 150,000 of the Company’s Ordinary Shares, or approximately 0.13% of the current outstanding share capital. As of September 30, 2022, the authorized share repurchase was completed and no ordinary shares remain available for repurchase under the program.None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS

The documents listed below are incorporated by reference or are filed with this Quarterly Report on Form 10-Q, in each case as indicated therein (numbered in accordance with Item 601 of Regulation S-K).


Exhibit
Number						Exhibit Description
2 .1						Common Draft Terms of Cross-Border Merger (projet commun de fusion transfrontalière), dated as of September 29, 2023, by and between FREYR Battery and FREYR Battery, Inc.(incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on October 5 , 2023).
2.2						Merger Agreement and Plan of Merger, by and between FREYR Battery and FREYR Battery, Inc. (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed on October 18, 2023).
3.1						Consolidated Articles of Association of FREYR Battery as of ~~November 7,~~December 20, 2022 (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed on March 15, 2023).
10.1						Amended and Restated Settlement Agreement between FREYR Battery Norway AS, FREYR Battery, and Tom Einar Jensen ~~Novemb~~er (incorporated by reference to Exhibit 10 ~~202~~.1 to the Current Report on Form 8-K filed on August 1 0 , 2023).
10.2						Consultancy Agreement between FREYR Battery and Tom Einar Jensen (incorporated by reference to Exhibit 10.2 ) to the Current Report on Form 8-K filed on August 10, 2023).
10.3						Contract of Employment between FREYR Battery and Birger Steen (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on August 10, 2023).
10.4						Retirement Agreement between FREYR Battery SA and Torstein Dale Sjøtveit (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on August 10, 2023).
31.1*						Certification of Principal Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of Principal Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1‡,*						Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2‡,*						Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101*						Pursuant to Rule 405 of Regulation S-T, the following financial information from the Company’s Quarterly Report on Form 10-Q for the period ended September 30, ~~2022~~2023 is formatted in Inline XBRL interactive data files: (i) Condensed Consolidated Balance Sheets as of September 30, ~~2022~~2023 and December 31, ~~2021;~~2022; (ii) Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, ~~2022~~2023 and ~~2021;~~2022; (iii) Condensed Consolidated Statements of Shareholders’ Equity for the nine months ended September 30, ~~2022~~2023 and ~~2021;~~2022; (iv) Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, ~~2022~~2023 and ~~2021;~~2022; and (v) Notes to Condensed Consolidated Financial Statements.
104*						Cover Page Interactive Data File formatted as Inline XBRL and contained in Exhibit 101


*			Filed herewith
‡			The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are deemed furnished and not filed with the U.S. Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	FREYR BATTERY

Date: November ~~14, 2022~~9, 2023	By:	~~/s/ Tom Einar Jensen~~
	~~Name:~~	~~Tom Einar Jensen~~
	~~Title:~~	~~Chief Executive Officer~~ ~~(Principal Executive Officer)~~

~~Date: November 14, 2022~~	~~By:~~	/s/ Oscar K. Brown
	Name:	Oscar K. Brown
	Title:	Group Chief Financial Officer (Principal Financial Officer &)

Date: November 9, 2023	By:	/s/ Lori A. Papp
	Name:	Lori A. Papp
	Title:	Chief Accounting Officer (Principal Accounting Officer)


	Three months ended September 30, 2022		Nine months ended September 30, 2022

Operating lease cost	$	558	$	1,577
Variable lease cost	65		167
Short-term lease cost	45		60
Total lease cost	$	668	$	1,804


	September 30, 2022


For the remainder of 2022	$	900
2023	2,664
2024	1,740
2025	1,783
2026	1,778
Thereafter	18,173
Total undiscounted lease payments	27,038
Less: imputed interest	(14,044)
Present value of lease liabilities	$	12,994


	September 30, 2022								December 31, 2021
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets:
Convertible Note	$	—	$	—	$	20,498	$	20,498	$	—	$	—	$	20,231	$	20,231
Liabilities:
Warrant Liabilities	$	—	$	—	$	94,712	$	94,712	$	—	$	—	$	49,124	$	49,124