Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Apr. 12, 2021 | Jun. 30, 2020 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity File Number | 001-38795 | ||
Entity Registrant Name | Romeo Power, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 83-2289787 | ||
Entity Address, Address Line One | 4380 Ayers Avenue | ||
Entity Address, City or Town | Vernon | ||
Entity Address State Or Province | CA | ||
Entity Address, Postal Zip Code | 90058 | ||
City Area Code | 833 | ||
Local Phone Number | 467-2237 | ||
Title of 12(b) Security | Common stock, par value $0.0001 pershare | ||
Trading Symbol | RMO | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
ICFR Auditor Attestation Flag | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 253.3 | ||
Entity Common Stock, Shares Outstanding | 130,545,081 | ||
Entity Central Index Key | 0001757932 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS $ in Thousands | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 292,442 | $ 429 |
Accounts receivable-net of allowance for expected credit loss (2020-$238; 2019-$238) | 841 | 307 |
Inventories-net | 4,937 | 6,670 |
Insurance receivable | 6,000 | 6,000 |
Prepaid expenses | 1,269 | 1,616 |
Total current assets | 305,489 | 15,022 |
RESTRICTED CASH | 1,500 | 1,500 |
PROPERTY, PLANT AND EQUIPMENT-Net | 5,484 | 6,573 |
EQUITY METHOD INVESTMENTS | 35,000 | 2,480 |
OPERATING RIGHT-OF-USE LEASE ASSETS | 5,469 | 5,707 |
OTHER NONCURRENT ASSETS | 3,100 | 1,296 |
TOTAL ASSETS | 356,042 | 32,578 |
CURRENT LIABILITIES: | ||
Accounts payable | 2,900 | 5,811 |
Accrued expenses | 2,844 | 1,197 |
Contract liabilities | 815 | 289 |
Current maturities of long-term debt | 2,260 | 5,000 |
Current maturities of long-term debt to related parties | 100 | |
Operating lease liabilities-current | 853 | 851 |
Legal settlement payable | 6,000 | 6,000 |
Other current liabilities | 384 | 315 |
Total current liabilities | 16,056 | 19,563 |
COMMITMENTS AND CONTINGENCIES (Note 18) | ||
LONG-TERM DEBT-Net of current portion | 1,082 | 5,225 |
OPERATING LEASE LIABILITIES-Noncurrent | 4,723 | 4,949 |
PUBLIC AND PRIVATE PLACEMENT WARRANTS | 138,466 | |
OTHER NONCURRENT LIABILITIES | 17 | 268 |
Total liabilities | 160,344 | 30,005 |
STOCKHOLDERS' EQUITY (DEFICIT): | ||
Common stock | 12 | 7 |
Preferred stock | ||
Notes receivable from stockholders | (9,175) | |
Additional paid-in capital | 373,129 | 181,567 |
Accumulated deficit | (177,443) | (169,826) |
Total stockholders' equity (deficit) | 195,698 | 2,573 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | 356,042 | 32,578 |
Series Seed Preferred Stock | ||
STOCKHOLDERS' EQUITY (DEFICIT): | ||
Total stockholders' equity (deficit) | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable-allowance for doubtful accounts | $ 238 | $ 238 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 126,911,861 | 74,449,847 |
Common stock, shares outstanding | 126,911,861 | 74,449,847 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
REVENUES: | ||
Revenue | $ 8,974 | $ 8,488 |
Related party service revenues | 3,142 | 1,976 |
Total net revenues | 8,974 | 8,488 |
COST OF REVENUES: | ||
Related party service cost | 2,631 | 1,657 |
Total cost of revenues | 17,965 | 17,237 |
GROSS LOSS | (8,991) | (8,749) |
OPERATING EXPENSES: | ||
Research and development | 7,995 | 11,242 |
Selling, general, and administrative | 17,338 | 13,890 |
Legal settlement expense | 4,586 | |
Total operating expenses | 25,333 | 29,718 |
OPERATING LOSS | (34,324) | (38,467) |
INTEREST EXPENSE | (1,111) | (10,954) |
INTEREST INCOME | 269 | |
LOSS ON EXTINGUISHMENT OF DEBT | (9,181) | |
CHANGE IN FAIR VALUE OF PUBLIC AND PRIVATE PLACEMENT WARRANTS | 34,168 | |
OTHER EXPENSE | (3,868) | |
NET LOSS BEFORE INCOME TAXES AND LOSS IN EQUITY METHOD INVESTMENTS | (5,135) | (58,333) |
LOSS IN EQUITY METHOD INVESTMENTS | (2,480) | (1,520) |
INCOME TAX EXPENSE | (2) | (1) |
NET LOSS | $ (7,617) | $ (59,854) |
NET LOSS PER COMMON SHARE | ||
Basic (in dollars per share) | $ (0.10) | $ (1.02) |
Diluted (In dollars per share) | $ (0.10) | $ (1.02) |
WeightedAverageNumberOfDilutedSharesOutstanding | ||
Basic (In shares) | 77,741,339 | 58,793,480 |
Diluted (In shares) | 77,741,339 | 58,793,480 |
Product revenues | ||
REVENUES: | ||
Revenue | $ 2,910 | $ 4,847 |
COST OF REVENUES: | ||
Cost of sales | 9,997 | 12,703 |
Service revenues | ||
REVENUES: | ||
Revenue | 2,922 | 1,665 |
COST OF REVENUES: | ||
Cost of sales | $ 5,337 | $ 2,877 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) $ in Thousands | Series Seed Preferred StockPreviously Reported [Member]USD ($) | Series Seed Preferred StockPreviously Reported [Member]USN ($) | Series Seed Preferred StockRevision of Prior Period, Adjustment [Member]USD ($)shares | Series Seed Preferred StockUSD ($) | Series Seed Preferred StockUSN ($) | Class A common stockCommon StockPreviously Reported [Member]USD ($)shares | Class A common stockCommon StockRevision of Prior Period, Adjustment [Member]USD ($)shares | Class A common stockCommon StockUSD ($) | Class A common stockCommon StockUSN ($) | Class B common stockCommon StockPreviously Reported [Member]USD ($)shares | Class B common stockCommon StockRevision of Prior Period, Adjustment [Member]USD ($)shares | Class B common stockCommon StockUSD ($) | Class B common stockCommon StockUSN ($) | Common StockPreviously Reported [Member]USD ($)shares | Common StockRevision of Prior Period, Adjustment [Member]USD ($)shares | Common StockUSD ($)shares | APICPreviously Reported [Member]USD ($) | APICRevision of Prior Period, Adjustment [Member]USD ($) | APICUSD ($) | Notes Receivable from StockholdersPreviously Reported [Member]USD ($) | Notes Receivable from StockholdersUSD ($) | Accumulated DeficitPreviously Reported [Member]USD ($) | Accumulated DeficitUSD ($) | Previously Reported [Member]USD ($) | Revision of Prior Period, Adjustment [Member]USD ($) | USD ($) |
Balance at the beginning at Dec. 31, 2018 | $ 11,415 | $ 69,555,900 | $ (11,415) | $ 0 | $ 0 | $ 1 | $ (1) | $ 0 | $ 0 | $ 1 | $ (1) | $ 0 | $ 0 | $ 0 | $ 3 | $ 3 | $ 62,297 | $ 11,414 | $ 73,711 | $ (52) | $ (52) | $ (109,972) | $ (109,972) | $ (47,725) | $ 11,415 | $ (36,310) |
Balance at the beginning (in shares) at Dec. 31, 2018 | shares | (69,555,900) | 94,860,482 | (94,860,482) | 106,552,443 | (106,552,443) | 0 | 33,034,720 | 33,034,720 | ||||||||||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||||||||||||
Issuance of common stock | $ 2 | 72,365 | 72,367 | |||||||||||||||||||||||
Issuance of common stock (in shares) | shares | 27,031,709 | |||||||||||||||||||||||||
Conversion of convertible notes and accrued interest into common stock | $ 2 | 31,845 | 31,847 | |||||||||||||||||||||||
Conversion of convertible notes and accrued interest into common stock (in shares) | shares | 18,294,022 | |||||||||||||||||||||||||
Issuance of detachable warrants associated with convertible notes, inclusive of beneficial conversion amount | 2,187 | 2,187 | ||||||||||||||||||||||||
Convertible note issuance premium | 5,318 | 5,318 | ||||||||||||||||||||||||
Recession of common stock | (1,164) | (1,164) | ||||||||||||||||||||||||
Recession of common stock (in shares) | shares | (944,509) | |||||||||||||||||||||||||
Redemption of common stock | (8,136) | (8,136) | ||||||||||||||||||||||||
Redemption of common stock (in shares) | shares | (3,056,581) | |||||||||||||||||||||||||
Stockholder note receivable | (9,123) | (9,123) | ||||||||||||||||||||||||
Contingent BCF and loss on extinguish of convertible notes | 3,875 | 3,875 | ||||||||||||||||||||||||
Stock based compensation | 1,566 | 1,566 | ||||||||||||||||||||||||
Stock based compensation (in shares) | shares | 90,486 | |||||||||||||||||||||||||
Net loss | (59,854) | (59,854) | ||||||||||||||||||||||||
Balance at the end at Dec. 31, 2019 | 0 | 0 | 0 | 0 | 0 | 0 | $ 7 | 181,567 | (9,175) | (169,826) | 2,573 | |||||||||||||||
Balance at the end (in shares) at Dec. 31, 2019 | shares | 74,449,847 | |||||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||||||||||||||||||
Issuance of common stock | $ 1 | 7,239 | 7,240 | |||||||||||||||||||||||
Issuance of common stock (in shares) | shares | 5,549,344 | |||||||||||||||||||||||||
Conversion of convertible notes and accrued interest into common stock | 7,709 | 7,709 | ||||||||||||||||||||||||
Conversion of convertible notes and accrued interest into common stock (in shares) | shares | 2,162,670 | |||||||||||||||||||||||||
Repayment of stockholder note receivable | 5,307 | 5,307 | ||||||||||||||||||||||||
Forgiveness of stockholder note receivable | 3,868 | 3,868 | ||||||||||||||||||||||||
Reverse recapitalization transaction, net | $ 4 | 173,047 | 173,051 | |||||||||||||||||||||||
Reverse recapitalization transaction, net (in shares) | shares | 44,750,000 | |||||||||||||||||||||||||
Stock based compensation | 3,567 | 3,567 | ||||||||||||||||||||||||
Net loss | (7,617) | (7,617) | ||||||||||||||||||||||||
Balance at the end at Dec. 31, 2020 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 12 | $ 373,129 | $ 0 | $ (177,443) | $ 195,698 | |||||||||||||||
Balance at the end (in shares) at Dec. 31, 2020 | shares | 126,911,861 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
OPERATING ACTIVITIES: | ||
Net loss | $ (7,617) | $ (59,854) |
Adjustments to reconcile net loss to net cash used for operating activities: | ||
Depreciation and amortization | 1,988 | 1,871 |
Stock-based compensation | 3,567 | 1,566 |
Inventory provision | 3,105 | 1,743 |
Gain on change in fair market value of Public and Private Placement Warrants | (34,168) | |
Loss on extinguishment of debt | 9,181 | |
Interest expense attributable to amortization of debt discount | 5,585 | |
Loss on equity method investment | 2,480 | 1,520 |
Non-cash lease expense-operating leases | 238 | 213 |
Non-cash lease expense-finance leases | 283 | (15) |
Loss on extinguishment of stockholder note receivable | 3,868 | |
Changes in assets and liabilities: | ||
Accounts receivable | (534) | (249) |
Inventories | (1,372) | (2,570) |
Prepaid expenses | (1,685) | (1,428) |
Accounts payable | (2,556) | (2,130) |
Interest accrued on notes payable | 468 | 455 |
Accrued expenses | 1,739 | (1,768) |
Contract liabilities | 526 | (898) |
Operating lease liabilities | (224) | (180) |
Other-net | 15 | (6) |
Net cash used for operating activities | (29,879) | (46,964) |
INVESTING ACTIVITIES: | ||
Capital expenditures | (1,325) | (1,099) |
Equity method investment | (35,000) | |
Other-net | (72) | |
Net cash used for investing activities | (36,325) | (1,171) |
FINANCING ACTIVITIES: | ||
Issuance of convertible notes | 1,924 | 5,450 |
Issuance of term notes | 6,475 | 19,000 |
Proceeds from PPP loan | 3,300 | |
Proceeds from stockholder note receivable | 5,307 | |
Repayment of term notes | (11,575) | (25,624) |
Issuance of line of credit | 32,000 | |
Repayment of line of credit | (32,000) | |
Redemption of common stock | (8,136) | |
Issuance of common stock, net of issuance costs | 5,027 | 56,639 |
Recapitalization transaction, net of transaction costs (See Note 3) | 345,831 | |
Exercise of stock options | 110 | 41 |
Exercise of stock warrants | 2,102 | 2,565 |
Payment for financed capital expenditures | (187) | |
Principal portion of finance lease liabilities | (284) | (31) |
Rescission of common stock | (1,164) | |
Net cash provided by financing activities | 358,217 | 48,553 |
NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH | 292,013 | 418 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH -Beginning of period | 1,929 | 1,511 |
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH-End of period | 293,942 | 1,929 |
RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH TO THE CONSOLIDATED BALANCE SHEETS: | ||
Total cash, cash equivalents, and restricted cash | 1,929 | 1,929 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | 595 | 4,486 |
Cash paid for income taxes | 2 | 1 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Purchases of property, plant and equipment in accounts payable at year end | 583 | 1,030 |
Conversion of promissory notes and accrued interest to common stock | 7,709 | 31,846 |
Allocation of debt proceeds to beneficial conversion feature | 329 | |
Allocation of debt proceeds to stock warrants | 2,047 | |
Exercise of warrants in exchange for note receivable | 9,123 | |
Investment in Joint Venture | 4,000 | |
Reverse recapitalization effect on additional paid-in capital | (172,779) | |
Issuance of common stock | $ 4,000 | |
Transaction costs included in accounts payable and accrued expenses | $ 172 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 12 Months Ended |
Dec. 31, 2020 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Romeo Power Inc. (f/k/a RMG Acquisition Corp.) was originally incorporated under the name RMG Acquisition Corp. (“RMG”) as a blank check company incorporated in Delaware on October 22, 2018 for the purpose of effecting a merger, capital stock-exchange, asset acquisition, share purchase, reorganization, or similar business combination. On October 5, 2020, RMG entered into an Agreement and Plan of Merger (as amended, the “Merger Agreement”), with RMG Merger Sub, Inc., a Delaware corporation and its wholly owned subsidiary (“Merger Sub”), and Romeo Systems, Inc., a Delaware corporation (“Legacy Romeo”). On December 29, 2020, pursuant to the terms of the Merger Agreement, the business combination with Legacy Romeo was effected through the merger of Merger Sub with and into Legacy Romeo, with Legacy Romeo surviving as the surviving company and as our wholly owned subsidiary (the “Merger” and, collectively with the other transactions described in the Merger Agreement, the “Business Combination”). Upon the closing of the Business Combination, we changed our name to Romeo Power, Inc. Romeo Power, Inc. designs, engineers, and manufactures lithium ion cylindrical battery packs for electric vehicles and energy storage solutions, with a focus on battery innovation, functionality, energy density, safety, and performance. We are headquartered in Vernon, California. Unless the context otherwise requires, “Romeo,” the “Company,” “we,” “us,” or “our” refers to the combined company and its subsidiaries following the Business Combination, “RMG” refers to the Company prior to the Closing, and “Legacy Romeo” refers to Romeo Systems, Inc. Refer to Note 3 for further discussion of the Business Combination. In 2019, Legacy Romeo and BorgWarner, Inc. (“BorgWarner”) formed BorgWarner Romeo Power LLC (the “Joint Venture”) of which we own 40%. The Joint Venture is intended to accelerate our reach into international regions in a capital efficient way. As a result, we manage our operations to focus on both this specific production and our core operations. Basis of Presentation The Business Combination was accounted for as a reverse recapitalization (the “Recapitalization Transaction”) in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 805, Business Combinations ● Legacy Romeo’s former stockholders hold a majority ownership interest in the combined company; ● Legacy Romeo’s existing senior management team comprise senior management of the combined company; ● Legacy Romeo is the larger of the companies based on historical operating activity and employee base; and ● Legacy Romeo’s operations comprise the ongoing operations of the combined company. Accordingly, all historical financial information presented in these combined and consolidated financial statements represents the accounts of Legacy Romeo and its wholly owned subsidiaries “as if” Legacy Romeo is the predecessor and legal successor. The historical operations of Legacy Romeo are deemed to be those of the Company. Thus, the financial statements included in this report reflect (i) the historical operating results of Legacy Romeo prior to the Business Combination; (ii) the combined results of RMG and Legacy Romeo following the Business Combination on December 29, 2020; (iii) the assets and liabilities of Legacy Romeo at their historical cost; and (iv) RMG’s equity structure for all periods presented. No step-up basis of intangible assets or goodwill was recorded in the Business Combination transaction consistent with the treatment of the transaction as a reverse capitalization. In connection with the Business Combination each share of Legacy Romeo common stock and preferred stock issued and outstanding immediately prior to the Business Combination (with each share of Legacy Romeo preferred stock being treated as if it were converted into Legacy Romeo common stock immediately prior to the Business Combination) converted into the right to receive 0.121730 shares (the “Exchange Ratio”) of common stock, par value $0.0001 (the “Common Stock”). The recapitalization of the number of shares of Common Stock attributable to Legacy Romeo is reflected retroactively as shares reflecting the Exchange Ratio to the earliest period presented and is utilized for calculating earnings per share in all prior periods presented. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation Consolidations Use of Estimates Cash and Cash Equivalents Restricted Cash Accounts Receivable, Net of Allowance for Expected Credit Losses After all attempts to collect an accounts receivable balance have failed, the accounts receivable balance is written off against the allowance for doubtful accounts. As of December 31, 2020 and 2019, we reported an allowance for doubtful accounts balance of $0.24 million. Leases ROU lease assets represent our right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments. Both the ROU lease asset and operating lease liability are recognized as of the lease commencement date based on the present value of the lease payments over the lease term. Our leases do not provide an implicit borrowing rate that can readily be determined. Therefore, we apply a discount rate based on the incremental borrowing rate, which is determined using the credit rating and other information available as of the lease commencement date. ROU lease assets also include any lease payments made before their contractual due dates and exclude any lease incentives. Our lease agreements may include options to extend the lease term or to terminate the lease early. We include options to extend or terminate leases upon determination of the ROU lease asset and lease liability when it is reasonably certain that we will exercise these options. Operating lease expense attributable to lease payments is recognized on a straight-line basis over the lease term and is included in cost of revenues and selling, general, and administrative expense on our consolidated statement of operations. Finance leases result in the recognition of depreciation expense, which is recognized on a straight-line basis over the expected life of the leased asset, and interest expense, which is recognized following an effective interest rate method. Depreciation expense attributable to finance leases is included in cost of revenues on our consolidated statement of operations. We have lease arrangements that include lease and non-lease components. The non-lease components in the arrangements are not significant when compared to the lease components. For all leases, we account for the lease and non-lease components as a single component. Additionally, for certain equipment leases, management applies a portfolio approach to effectively account for the ROU lease assets and lease liabilities. We evaluate ROU lease assets for impairment consistent under the impairment of long-lived assets policy. Inventory Property, Plant and Equipment Betterments, renewals, and repairs that extend the useful life of the asset are capitalized. Other repairs and maintenance charges are expensed as incurred. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation and amortization are eliminated from our accounts, and any resulting gain or loss is recognized in the accompanying consolidated statement of operations. Depreciation and amortization are computed using the following estimated useful lives of the assets: Asset Years Production and test equipment 7 Furniture and fixtures 7 Tooling 5 Automobiles 5 Computer equipment 4 Software 3 Equity Method Investments Impairment of Long-Lived Assets Revenue Recognition Revenue from Contracts with Customers 1. identifying the contract with a customer; 2. identifying the performance obligations in the contract; 3. determining the transaction price; 4. allocating the transaction price to the performance obligations; and 5. recognizing revenue as the performance obligations are satisfied. We recognize revenue when (or as) performance obligations are satisfied by transferring control of the performance obligation to a customer. Control of a performance obligation may transfer to the customer either at a point in time or over time depending on an evaluation of the specific facts and circumstances for each contract, including the terms and conditions of the contract as agreed with the customer, as well as the nature of the products or services to be provided. Our contracts with customers generally include either a combination of prototypes with related engineering services or product sales. For product sales, the primary performance obligation to our customers is the delivery of finished goods and products under associated purchase orders. Control of the products sold typically transfers at a point in time upon delivery to the customer’s warehouse or at transportation shipping point, based upon when title of ownership passes to the customer under the terms and conditions of the arrangement. Each customer purchase order sets forth the transaction price for the products and services purchased under the arrangement. For contracts with multiple performance obligations, we evaluate whether the stated selling prices for the products or services represent their standalone selling prices. When it is necessary to allocate the transaction price to multiple performance obligations (i.e. for customized solutions unique to a customer’s specifications), management typically uses the expected cost plus a reasonable profit margin to estimate the standalone selling price of each product or service. For standard products and services with observable sales transactions, the observable sales transactions are used to determine the standalone selling price. Some customer arrangements include variable consideration, such as volume discounts, some of which depend upon the customers meeting specified performance criteria, such as a purchasing level over a period of time. We use judgment to estimate the most likely amount of variable consideration at customer contract inception and then again at each reporting date. When estimating variable consideration, we also apply judgment when considering the probability of whether a reversal of revenue could occur and only recognizes revenue subject to this constraint. Customer arrangements that include the provision of developed or customized products that require the bundling of promises, such as providing non-recurring engineering and development services that lead to a prototype, are combined into a single performance obligation because the individual products and services that are required to fulfill the customer requirements do not meet the criteria for a distinct performance obligation. These customized products generally have no alternative use to Romeo and are recognized over time or at a point in time depending on whether the terms and conditions of these arrangements give us the enforceable right to payment for performance completed to date, including a reasonable profit margin. For arrangements that provide an enforceable right to payment, control transfers over time and we measure progress towards completion by selecting the input or output method that best depicts the transfer of control of the underlying goods and services to the customer for each respective arrangement. Methods we use to measure progress toward completion include the use of a percentage of completion cost-to-cost measure of progress because it best depicts the transfer of control to the customer as we incur costs on our contracts. Under the percentage-of- completion cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the performance obligation(s). For arrangements where no enforceable right to payment exists, we will recognize revenue at a point in time based on the title transfer of the final prototype or specified product. We also provide services to the Joint Venture under separate work orders and contractual arrangements. These services include a single performance obligation for non-recurring and other engineering services, which are provided at cost incurred plus a fixed fee percentage. Revenue for these services is recognized over time, based on costs incurred or the right to invoice method (i.e., in situations where the value transferred matches the billing rights), as the customer receives and consumes the benefits. Our typical payment terms are 30–60 days, and sales arrangements do not include any significant financing components for its customers. Any payments that are received from a customer in advance of satisfaction of a related performance obligation, as well as billings in excess of revenue recognized, are deferred and treated as a contract liability. Advance payments and billings in excess of revenue recognized are classified as current or non- current contract liabilities based on the timing of when the recognition of revenue is expected. Freight charges billed to customers are included in sales, and the related shipping costs are included in cost of revenues on the consolidated statements of operations. If shipping activities are performed after a customer obtains control of a product, we apply a policy election under ASC 606 to account for shipping as an activity to fulfill the promise to transfer the product to the customer. We also apply a policy election to exclude transaction taxes collected from customers from sales when the tax is both imposed on and concurrent with a specific revenue-producing transaction. We generally provide customers with a product warranty that assures that the products meet standard specifications and are free of defects. Claims incurred under our standard product warranty programs are recorded based on open claims and historical experience, which have not been significant and were not significant for the years ended December 31, 2020 and 2019. Cost of Revenues costs; depreciation and amortization; lease costs; and freight and shipping costs. Costs are expensed as incurred, or as control of products is transferred, except for costs incurred to fulfill a contract, which are capitalized and amortized on a straight-line basis over the expected period of performance. We do not incur significant incremental costs to acquire contracts. Research and Development Other Costs Income Taxes We record a valuation allowance, when necessary, to reduce deferred tax assets to the amount expected to be realized. Estimates of the realizability of deferred tax assets, as well as our assessment of whether an established valuation allowance should be reversed, are based on projected future taxable income, the expected timing of the reversal of deferred tax liabilities, and tax planning strategies. When evaluating whether projected future taxable income will support the realization of our deferred tax assets, we consider both our historical financial performance and general economic conditions. In addition, we consider the time frame over which it would take us to utilize the deferred tax assets prior to their expiration. We utilize a two-step approach to recognizing and measuring uncertain income tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained upon examination by the Internal Revenue Service (IRS) or other taxing authorities, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. We consider many factors when evaluating and estimating tax positions and tax benefits, which may require periodic adjustments and may not accurately forecast actual outcomes. As more fully described in note 14, management determined as of December 31, 2020 that a portion of the deferred tax benefit related to federal and state research tax credits is not more likely than not to be sustained upon examination. Basic and Diluted Loss Per Share Earnings per Share. Stock-Based Compensation The estimated fair value of stock options and warrants, excluding market-based awards is estimated on the grant date using the Black-Scholes option-pricing model. The fair value of restricted stock awards granted prior to there being a public market for our stock, was measured based on the grant date estimated fair value of our common stock. The Black-Scholes option-pricing model requires inputs such as the fair value of our common stock, the risk-free interest rate, expected term, expected dividend yield and expected volatility. The most significant assumption used in determining the fair value of stock-based awards, granted prior to there being a public market for our stock, was the estimated fair value of common stock on the date of grant. Prior to there being a public market for our stock, in order the determine the fair value of the common stock on the date of grant, a valuation analysis was performed by management, with the assistance of a third-party valuation firm, using a combination of market and income approaches. The risk-free interest rate assumption is determined by using the U.S. Treasury rates of the same period as the expected option term of each stock option. We use the simplified method to calculate the expected term. The dividend yield assumption is based on the dividends expected to be paid over the expected life of the stock option. Our volatility is derived from several publicly traded peer companies. We estimate the grant date fair value of awards with market conditions using a Monte Carlo simulation or other appropriate fair value method with the assistance of an independent third-party valuation firm. Convertible Notes If the conversion feature did not require recognition as a bifurcated derivative, the convertible debt instrument was evaluated for consideration of any beneficial conversion feature (“BCF”) requiring separate recognition. We assessed the existence of a BCF based upon a comparison of a convertible debt instrument’s effective conversion price (e.g., after allocation of a portion of debt proceeds to other freestanding or embedded features) to the commitment date fair value of the equity into which the debt instrument was convertible. When we recorded a BCF, the intrinsic value of the BCF was recorded as a debt discount against the face amount of the respective debt instrument, with an offset to additional paid-in capital. The debt discount attributable to the intrinsic value of the BCF was subsequently amortized to interest expense over the life of the debt. In certain instances, the ultimate conversion price attributable to our convertible notes was contingent on future events not certain to occur. In these cases, any contingent beneficial conversion feature was measured using the commitment date fair value of the equity into which the notes are convertible; however, we do not recognize the incremental intrinsic value that may result from a change in the conversion price until the contingencies are resolved. In connection with the Business Combination, all of our issued and outstanding convertible notes and accrued but unpaid interest converted into shares of Common Stock as if they had converted into shares of Legacy Romeo Class A common stock immediately prior to the Business Combination. Subsequent to the Business Combination, we do not expect to continue issuing convertible notes. Public and Private Placement Warrants – Derivatives and Hedging The Public and Private Placement Warrants were initially recorded at fair value on the date of the Business Combination and are subsequently adjusted to fair value at each subsequent reporting date. Changes in the fair value of these instruments are recognized within change in fair value of Public and Private Placement Warrants in the consolidated statements of operations. Fair Value of Financial Instruments Level 1 Inputs Level 2 Inputs Level 3 Inputs As of December 31, 2020, the fair value of cash, accounts receivable, accounts payable, accrued expenses, other payables, short-term and long-term debt obligations approximated carrying value due to their short-term maturities. Cash equivalents consist of $16.00 million highly liquid U.S. Treasury Bills and other government-backed securities purchased on December 31, 2020. The cash equivalents are valued using quoted prices in active markets and accordingly are categorized in Level 1 of the fair value hierarchy. We entered into a Battery Recycling Agreement (the “Battery Recycling Arrangement”) with Heritage Battery Recycling, LLC (“HBR”), an affiliate of Heritage Environmental Services, Inc. (“HES”). As of December 31, 2020, the carrying value of our equity method investment in the Battery Recycling Arrangement approximated the fair value and it is considered a Level 3 asset of the fair value hierarchy because determining the fair value of our investment in the Battery Recycling Arrangement required the use of significant unobservable inputs, including the expected profits, amount and timing of future cashflows, guarantees to fund future losses, and the expected margin on products in an early stage industry. Refer to Note 8 – Equity Method Investments for discussion of our equity method investment in the Battery Recycling Arrangement. The Public and Private Placement Warrants are measured at fair value on a recurring basis. The Public Warrants are traded on the NYSE and are recorded at fair value using the closing stock price as of the measurement date, and as such, represents a Level 1 fair value measurement. The Private Placement Warrants are recorded at fair value on a recurring basis using a Black-Scholes option-pricing model, and as such, represent a Level 2 fair value measurement. We will continue to adjust these liabilities for changes in fair value for the Public and Private Placement Warrants until the warrants are exercised, redeemed or cancelled. The fair value of the Private Placement Warrants is established using Level 1 and Level 2 inputs and determined using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires inputs such as the fair value of our Common Stock, the risk-free interest rate, expected term, expected dividend yield and expected volatility. The fair value of our Common Stock is considered a Level 1 input as shares of our Common Stock are freely traded on the NYSE. The risk-free interest rate assumption is determined by using the U.S. Treasury rates of the same period as the expected term of the Private Placement Warrants, which is 5 years. The dividend yield assumption is based on the dividends expected to be paid over the expected life of the warrant. Our volatility is derived from several publicly traded peer companies. The fair value of the Public Warrants and the Private Placement Warrants, which are measured on a recurring basis as of December 31, 2020 was as follows: Fair Value as of December 31, 2020 (in thousands) Total (Level 1) (Level 2) (Level 3) Financial liabilities: Public Warrants $ 71,453 $ 71,453 $ — $ — Private Placement Warrants 67,013 — 67,013 — Total financial liabilities $ 138,466 $ 71,453 $ 67,013 $ — The key assumptions used to determine the fair value of the Private Placement Warrants as of December 31, 2020 and December 29, 2020 (the date the warrants were acquired) using the Black-Scholes model were as follows: Fair Value Assumptions December 31, 2020 December 29, 2020 Risk-free interest rate 0.17% 0.17% Expected term (in years) 5 5 Expected volatility 57% 57% Dividend yield 0% 0% Fair value of common stock $ 22.49 $ 27.00 Recently Adopted Accounting Pronouncements Credit Losses on Financial Instruments Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses of Financial Instruments Financial Instruments – Credit Losses (ASC 326), Derivatives and Hedging (ASC 815), Leases (ASC 842) The Company’s financial assets that are measured in accordance with ASC 326 include accounts receivable and an insurance receivable. On January 1, 2020, receivables are recorded at amortized cost less an allowance for expected credit losses. The Company estimates the allowance for credit losses in relation to receivables based on relevant qualitative and quantitative information about historical events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported accounts receivable. Earnings per Share , Earnings Per Share (ASC 260); Distinguishing Liabilities from Equity (ASC 480); Derivatives and Hedging (ASC 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. Leases Leases Accounting Pronouncements Issued, But Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, ASC 740, “Income Taxes (ASC 740): Simplifying the Accounting for Income Taxes |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2020 | |
BUSINESS COMBINATION | |
BUSINESS COMBINATION | 3. BUSINESS COMBINATION On October 5, 2020, we entered into the Merger Agreement with Merger Sub and Legacy Romeo. On December 29, 2020, pursuant to the terms of the Merger Agreement, the Business Combination with Legacy Romeo was effected through the merger of Merger Sub with and into Legacy Romeo, with Legacy Romeo surviving as the surviving company and as our wholly owned subsidiary. Upon the closing of the Business Combination, we changed our name to Romeo Power, Inc. The closing of the Business Combination occurred on December 29, 2020. In connection with the Business Combination: ● A number of purchasers (each, a “Subscriber”) purchased an aggregate of 16,000,000 shares of Common Stock (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $160.00 million, pursuant to separate subscription agreements (each, a “Subscription Agreement”) entered into effective as of October 5, 2020. The sale of PIPE Shares was consummated concurrently with the Closing of the Business Combination. ● 82,037,151 shares of Common Stock were issued for (1) the Legacy Romeo Class A common stock and the Legacy Romeo Class B common stock, (2) Legacy Romeo’s issued and outstanding preferred stock (as if the preferred stock had converted into Legacy Romeo Class A common stock immediately prior to the Business Combination at the conversion price prescribed in Legacy Romeo’s Certificate of Incorporation for each respective class of preferred stock) and (3) Legacy Romeo’s issued and outstanding convertible notes, inclusive of interest accrued thereon (as if the convertible notes had converted into Legacy Romeo Class A common stock immediately prior to the Business Combination at a conversion price of $0.4339 per share). ● We settled the outstanding underwriting fees incurred in connection with the initial public offering of RMG (the “RMG IPO”) on February 12, 2019, that were deferred until the closing of the Business Combination, for which the final cash amount owed was $8.05 million. ● We settled the direct and incremental transaction costs incurred prior to, or concurrent with, the closing of the Business Combination. In connection with the Business Combination, Legacy Romeo and RMG incurred direct and incremental costs of $40.49 million, including $0.17 million RMG paid in advance of the closing, consisting of legal, accounting, and underwriting fees and other costs incurred that are directly related to the Business Combination. The direct and incremental transaction costs are recorded as a reduction to additional paid-in capital. ● Legacy Romeo settled all outstanding term notes, including accrued and unpaid interest for $12.17 million. ● The holders of Legacy Romeo options and holders of Legacy Romeo warrants continue to hold such options or warrants, and such options and warrants remain subject to the same vesting, exercise and other terms and conditions. The holders of Legacy Romeo options and the holders of Legacy Romeo warrants, as applicable, may exercise their options and warrants to purchase a number of shares of Common Stock equal to the number of shares of Legacy Romeo common stock subject to such Legacy Romeo options and Legacy Romeo warrants multiplied by the Exchange Ratio (rounded down to the nearest whole share) at an exercise price per share divided by the Exchange Ratio (rounded up to the nearest whole cent). The net proceeds from the Business Combination, as reported in the consolidated statements of cash flows for the year ended December 31, 2020, within the financing section are summarized below (in thousands): Gross proceeds $ 394,196 Less: fees paid to the RMG IPO underwriters 8,050 Less: fees paid to the underwriters 22,513 Less: other transaction costs 17,802 Net cash received from the Business Combination $ 345,831 |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2020 | |
REVENUES | |
REVENUES | 4. REVENUES Contract Liabilities Balance on December 31, 2019 $ 289 Revenues recognized (3,167) Increase due to billings 3,693 Balance on December 31, 2020 $ 815 Contract liabilities are earned as services and prototypes are transferred to the customer. The remaining contract liability balance as of December 31, 2020 is expected to be earned and recognized as revenues within the next twelve months. As of December 31, 2020, we had executed certain contracts with customers to deliver specific battery packs, modules, and battery management system and software services. These contracts contain minimum quantity purchase requirements that are non-cancellable (other than for a breach by Romeo), and we have enforceable rights to pursue payments due under these contracts under make-whole provisions or through customary remedies for breach of contract if the minimum quantities are not ordered. As of December 31, 2020, we had $555.37 million of unsatisfied performance obligations related to minimum quantity purchase commitments included in these contracts. For $312 million out of the $555.37 million of unsatisfied performance obligations related to minimum quantity purchase commitments, if the customers do not follow through on their minimum purchase commitments, we would receive a maximum of $292.76 million under certain make-whole provisions included in these contracts. For the remaining $243.17 million of unsatisfied performance obligations related to minimum quantity purchase commitments included in these contracts, if the customers do not follow through on their minimum purchase commitments, we would seek damages through customary remedies for breach of contract. Of the $555.37 million of unsatisfied performance obligations as of December 31, 2020, $23.35 million is expected to be satisfied during the fiscal year years thereafter Revenue from Contracts with Customers (Topic 606) and subsequent amendments (“Topic 606”) Disaggregation of Revenues The following table disaggregates revenues by type of products, services and segment for the years ended December 31, 2020 and 2019 (in thousands): 2020 Romeo Power Joint Venture North America Support Total Products: Modules $ 2,910 $ — $ 2,910 Packs — — — Total product revenues 2,910 — 2,910 Services: Non-recurring engineering and prototype 2,922 — 2,922 Joint Venture support — 3,142 3,142 Total service revenues 2,922 3,142 6,064 Total revenues $ 5,832 $ 3,142 $ 8,974 2019 Romeo Power Joint Venture North America Support Total Products: Modules $ 4,652 $ — $ 4,652 Packs 195 — 195 Total product revenues 4,847 — 4,847 Services: Non-recurring engineering and prototype 1,665 — 1,665 Joint Venture support — 1,976 1,976 Total service revenues 1,665 1,976 3,641 Total revenues $ 6,512 $ 1,976 $ 8,488 The following table disaggregates revenues by when control is transferred for the years ended December 31, 2020 and 2019 (in thousands): 2020 2019 Point in time $ 5,832 $ 6,512 Over time 3,142 1,976 Total $ 8,974 $ 8,488 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY, PLANT AND EQUIPMENT | |
PROPERTY, PLANT AND EQUIPMENT | 5. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment for the years ended December 31, 2020 and 2019, consisted of the following (in thousands): 2020 2019 Production and test equipment $ 6,291 $ 5,726 Computer equipment 847 778 Software 2,141 2,093 Tooling 912 203 Furniture and fixtures 98 97 Leasehold improvements 1,076 1,076 Automobiles 22 22 Assets not yet in service 260 753 Total property, plant and equipment 11,647 10,748 Less accumulated depreciation and amortization (6,163) (4,175) Total property, plant and equipment—net $ 5,484 $ 6,573 Total depreciation and amortization expense for the years ended December 31, 2020 and 2019, was $1.99 million and $1.87 million, respectively. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
LEASES | 6. LEASES We have operating and finance leases for our warehouse and certain equipment. Our leases have remaining terms from 1 which The components of lease expense as of December 3 1 2020 and 2019 2020 2019 Operating lease cost $ 912 $ 912 Finance lease cost: Amortization of right-of-use assets 283 62 Interest on lease liabilities 48 15 Total finance lease cost $ 331 $ 77 Supplemental cash flow information related to leases as of December 31, 2020 and 2019, was as follows (in thousands): 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 899 $ 878 Operating cash flows from finance leases 48 15 Financing cash flows from finance leases 283 31 Supplemental consolidated balance sheet information related to leases as of December 31, 2020 and 2019, was as follows (in thousands): 2020 2019 Operating leases: ROU assets-operating leases $ 5,469 $ 5,707 Lease liabilities-operating leases (current) $ 853 $ 851 Lease liabilities-operating leases (non-current) 4,723 4,949 Total lease liabilities-operating leases $ 5,576 $ 5,800 Finance leases: Other noncurrent assets $ 269 $ 551 Other current liabilities $ 282 $ 315 Other noncurrent liabilities 17 268 Total leases liabilities-finance leases $ 299 $ 583 Weighted Average Remaining Lease Term 2020 2019 Operating leases 11 years 12 years Finance leases 1 years 2 years Weighted Average Discount Rate 2020 2019 Operating leases 12.0 % 12.0 % Finance leases 11.2 % 11.2 % Maturities of lease liabilities were as follows (in thousands): Operating Finance Year Ended December 31 Leases Leases 2021 $ 901 $ 295 2022 902 19 2023 902 — 2024 902 — 2025 902 — Thereafter 5,489 — Total future minimum lease payments 9,998 314 Less imputed interest (4,422) (15) Total $ 5,576 $ 299 |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORY | |
INVENTORY | 7. INVENTORY As of December 31, 2020, and 2019, inventory consisted of the following (in thousands): 2020 2019 Raw materials $ 4,064 $ 5,535 Work-in-process 531 462 Finished goods 342 673 Total inventories $ 4,937 $ 6,670 We write down inventory for obsolete inventory items and when the net realizable value of inventory items is less than their carrying value. During the years ended December 31, 2020 and 2019, we recorded a write-down of $3.11 million and $1.74 million, respectively, in cost of revenues. |
EQUITY METHOD INVESTMENTS
EQUITY METHOD INVESTMENTS | 12 Months Ended |
Dec. 31, 2020 | |
EQUITY METHOD INVESTMENTS | |
EQUITY METHOD INVESTMENTS | 8. EQUITY METHOD INVESTMENTS Borg Warner Romeo Power LLC On May 6, 2019, Legacy Romeo and BorgWarner closed a Series A-1 preferred stock round of financing through a Stock Purchase Agreement for the sum of $50.00 million. In connection with the investment in Legacy Romeo by BorgWarner, Legacy Romeo and BorgWarner formed BorgWarner Romeo Power LLC on June 28, 2019. Legacy Romeo and BorgWarner contributed $4.00 million and $6.00 million of cash at inception, for a 40% and 60% interest in the Joint Venture, respectively. This Joint Venture was entered into for Legacy Romeo and BorgWarner to collaborate in the design and manufacture of specific battery module and pack technology and extend the reach into other international regions. Legacy Romeo concurrently entered into a licensing agreement with the Joint Venture, allowing the Joint Venture rights to use, market, offer for sale and sell products and services using Legacy Romeo’s intellectual property in return for royalty payments payable and based on a percentage of revenue generated by the Joint Venture. Legacy Romeo also entered into a separate services agreement to provide engineering and other professional services to the Joint Venture. Legacy Romeo has no obligation to provide the Joint Venture additional funding and we have not guaranteed any of the Joint Venture’s losses. Romeo recognized revenue of $3.14 million and $1.98 million related to the services agreement during the years ended December 31, 2020 and 2019, respectively. Royalty revenue associated with the licensing agreement through December 31, 2020 and 2019, was immaterial. The Joint Venture is a variable interest entity. We do not consolidate the Joint Venture in our consolidated financial statements as we lack the ability to direct the activities that most significantly impact the Joint Venture’s economic performance and are therefore not the primary beneficiary. The investment in the Joint Venture is accounted for under the equity method of accounting as we do not have a controlling financial interest. We recorded a $2.48 million and $1.52 million loss from equity method investment, representing our share of the Joint Venture’s net loss for the year ended December 31, 2020 and the period from the date of investment through December 31, 2019. This loss was recorded as loss in equity method investments on the consolidated statement of operations and reduced the carrying value of our investment as of December 31, 2020 and 2019, respectively. As of December 31, 2020, our share of the Joint Venture’s net losses reduced the equity method investment balance to $0. Legacy Romeo and BorgWarner agreed to contribute an additional $10.00 million to the Joint Venture which represented funding for 2021 capital needs. In January 2021 we invested $4.0 million in the Joint Venture, which represented our pro rata share of the agreed upon funding. Heritage Battery Recycling, LLC On October 2, 2020, we entered into the Battery Recycling Arrangement with HBR, an affiliate of HES. Under the Battery Recycling Arrangement, HBR has agreed to design, build and operate a system for redeploying, recycling or disposing of lithium-ion batteries (the “System”) to be located at HES’s facility in Arizona. Immediately following the Business Combination on December 29, 2020, we contributed $35.00 million to HBR, a related party to an investor in Legacy Romeo and an investor of $25.00 million in the PIPE Shares. Our investment in HBR is intended to fund the building, operation, maintenance, and repair of the System. The terms of the Battery Recycling Arrangement require us to fund 30% of any operating shortfall of the System for the duration of the agreement with HBR and gives us the right to receive 30% of the profit generated by the System. The initial contract duration is for a period of ten years from December 29, 2020, and the agreement automatically extends for one-year renewal periods indefinitely. While the arrangement is in effect, it establishes a strategic arrangement with HES for the collection of our battery packs for recycling, and it gives our customers priority at the recycling facility. We also have agreed to fund, in principal, up to $10.00 million for a pilot that, if successful, could lead to the purchase of commercial vehicles containing Romeo batteries by HBR’s affiliate. The terms of the pilot program have not yet been finalized and reflected in an executed agreement. We have determined that the Battery Recycling Arrangement should be accounted for as an equity method investment. We have not consolidated our interest in the System or HBR in our consolidated financial statements as we lack the ability to direct the activities that most significantly impact HBR’s or the System’s economic performance and are therefore not the primary beneficiary and we do not exercise control over HBR. We evaluated the characteristics of the arrangement to determine if it is more similar to a financial instrument, a loan, or an investment to be accounted for under the equity method of accounting. The classification of the contribution and subsequent accounting considerations involves significant judgment and relies on various factors including, the significance of HBR’s equity in the project, the amount and timing of expected profits, our requirement to fund 30% of the System’s operating shortfall, our ability to share in 30% of its operating profits, and the estimated fair value of the arrangement at inception. Based on the facts and circumstances surrounding the Battery Recycling Arrangement we concluded that it constitutes an arrangement that should be accounted for as an equity method investment. We recorded our $35.00 million equity method investment in our consolidated balance sheet as of December 31, 2020, which we believe represents the fair value of the Battery Recycling Arrangement at inception. As of December 31, 2020, HBR had not yet constructed the battery recycling facility or begun operation of the System. |
SHORT-TERM AND LONG-TERM DEBT
SHORT-TERM AND LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2020 | |
SHORT-TERM AND LONG-TERM DEBT | |
SHORT-TERM AND LONG-TERM DEBT | 9. SHORT-TERM AND LONG-TERM DEBT As of December 31, 2020 and 2019, short-term and long-term debt is comprised of the following (in thousands): 2020 2019 Convertible notes: Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in December 2022. Conversion price is the lesser of the next equity financing or $0.4339 per share $ — $ 4,200 Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in December 2022. Conversion price is $0.4339 per share — 1,025 Total convertible notes — 5,225 Term Notes: Issued 2019, interest rate fixed at 1.55%. Principal and interest are payable at maturity in December 2020 — 100 Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in various dates in 2020 — 5,000 Total term notes — 5,100 Paycheck Protection Program: Issued June 2020, interest rate fixed at 1% . Principal and interest are due in installments starting 3,300 — Issued June 2020, interest rate fixed at 1% . Principal and interest are due in installments starting 42 — Total paycheck protection program 3,342 — Total short-term and long-term debt 3,342 10,325 Less current portion due to related parties — (100) Less current portion (2,260) (5,000) Total long-term debt $ 1,082 $ 5,225 Convertible Notes Generally, the convertible notes allowed for voluntary conversion subsequent to note issuance. Most of the convertible notes also provided for voluntary or mandatory conversion rights upon certain financing and non-financing events. Upon the closing of a next equity financing, a holder could elect or be required to convert the outstanding balance of the convertible note. A next equity financing was defined as a transaction or series of transactions pursuant to which we issued and sold shares of our capital stock for sufficient gross proceeds or effectuated a reverse recapitalization transaction. Upon a next equity financing, the convertible notes could convert into a number of shares of the class of capital stock issued in that next equity financing equal to the outstanding balance divided by the conversion price. The conversion price associated with the convertible notes varied, as is further described below. In January and February 2019, we issued $0.23 million in convertible notes. Interest accrued on the outstanding principal balance of these notes at 8%, per year with any outstanding principal and interest due in full at maturity 6 months from the date of issuance. These convertible notes were voluntarily convertible into shares of Legacy Romeo Class A common stock at the option of the holder or automatically convertible upon a change of control event. The convertible notes were also mandatorily convertible into the shares of capital stock issued in a next equity financing. The conversion price for these convertible notes was the lesser of the price per share paid by the other purchasers of the capital stock sold in the applicable next equity financing or the conversion price determined based upon a defined valuation cap. In January through April 2019, we modified the maturity dates to March or April 2019, certain interest rates, certain conversion features, and certain principal amounts for $8.30 million of convertible notes issued in 2018 and $4.4 million of term notes issued in 2018. We accounted for these modifications as an extinguishment of the existing notes during 2019, and execution of new notes. As a result, we recorded a loss from extinguishment of convertible notes of $5.14 million, which was included in loss on extinguishment of debt on the consolidated statement of operations for the year ended December 31, 2019. The convertible notes extinguished were reissued at a substantial premium, based on the fair value of the new convertible notes. We considered this premium to be equivalent to a capital contribution and recorded the $5.32 million premium as additional paid-in capital in our 2019 consolidated statement of changes in stockholders’ equity (deficit) as of December 31, 2019. We evaluated the newly issued convertible promissory notes for embedded conversion features and determined that the effective conversion price of the convertible promissory notes was below the fair value of our common stock. As such, we recorded a beneficial conversion feature of $0.33 million as a debt discount to be amortized to interest expense over the term of the notes. On May 6, 2019, in connection with the issuance of Legacy Romeo Series A preferred stock (Note 11), $19.20 million of the outstanding convertible notes, $8.71 million of the term notes and $3.89 million of accrued and unpaid interest, converted into Legacy Romeo Series A preferred stock. The notes converted at the lesser of $0.36 per Legacy Romeo share or the respective convertible note’s valuation cap divided by the fully diluted shares outstanding. In connection with the Business Combination, the shares of Series A preferred stock were exchanged for shares of Common Stock, as if they had converted to Legacy Romeo Class A common stock immediately prior to the Business Combination. In exchange for the Series A preferred stock, holders were issued 18,294,022 shares of Common Stock. For presentation purposes the exchange for Common Stock is deemed to have occurred on May 6, 2019. As of the date of the conversion, all discounts related to the initial beneficial conversion features had been fully amortized, and we recognized incremental interest expense for contingent beneficial conversion features determined based upon the notes’ ultimate conversion prices. For the year ended December 31, 2019, we recorded $1.90 million of interest expense related to beneficial conversion features. Where notes did not convert in accordance with their original terms, we recognized a loss on extinguishment of $3.68 million on the consolidated statement of operations for the year ended December 31, 2019. In December 2019, we issued $5.23 million in new convertible notes. In January and February 2020, we issued an additional $1.9 million in new convertible notes. Interest accrued on the outstanding principal balance of the notes at 8%, compounded annually, with any outstanding principal and interest due in full at maturity, which ranged from December 2022 through February 2023. The convertible notes were automatically convertible into the shares of Legacy Romeo capital stock issued in a next equity financing, of $20.0 million or more, or were voluntarily convertible at maturity into Legacy Romeo new preferred stock. In the event of a change of control, certain convertible notes are automatically either redeemed or converted into shares of Legacy Romeo Class A common stock, whichever is greater. The conversion price for these convertible notes was either $0.4339 per Legacy Romeo share or the lesser of the next equity financing or $0.4339 per Legacy Romeo share. At the issuance date, we evaluated the embedded features associated with the convertible promissory notes. Based on the analysis performed, we determined that no features required separate accounting. In connection with the Business Combination all of our issued and outstanding convertible notes were exchanged for shares of Common Stock as if they had converted to shares of Legacy Romeo Class A common stock, at the conversion price of $0.4339, immediately prior to the Business Combination. As of December 31, 2020, we had no convertible notes outstanding. Term Notes During the year ended December 31, 2020, we issued an additional $6.48 million of term notes. Interest accrued on the outstanding principal balance of the notes at either 15% or the Applicable Federal Rate (“AFR”) as of the date of issuance, which ranged from 0.09% - 1.58%. In September 2020, we modified the maturity dates for two term notes issued in 2019 to February 12, 2021 and increased the interest rate from 8% to 10%. One modification was accounted for as an extinguishment of the existing note in September 2020, and execution of a new note. Based upon the fair value of the new note, we did not record a gain or loss upon extinguishment. In connection with the Business Combination we repaid $12.17 million in outstanding term notes, including $0.60 million in accrued but unpaid interest. As of December 31, 2020, there were no term notes outstanding. Line of Credit Paycheck Protection Program (“PPP”) Loan The expected maturities associated with the outstanding PPP Loan as of December 31, 2020 were as follows (in thousands): December 31, 2021 $ 2,259 2022 1,053 2023 12 2024 12 2025 6 Total $ 3,342 Legacy Romeo Warrants There was no amortization of debt discounts included in interest expense during the year ended December 31, 2020. Amortization of the debt discount included in interest expense for the year ended December 31, 2019 totaled $3.69 million. The following table presents a summary of activity for the warrants issued in connection with short- term and long-term debt (dollars in thousands, except weighted average exercise prices): Weighted Weighted Average Average Exercise Remaining Aggregate Number of Price Contractual Intrinsic Warrant Activity and Other Data Warrants Per Share Life Value Warrants Outstanding, January 1, 2020 3,432,094 $ 3.78 7.8 $ — Granted — — Exercised (771,457) 2.72 $ 2,564 Forfeited — — Expired — — Warrants outstanding, December 31, 2020 2,660,637 $ 4.41 8.9 $ 48,104 Warrants exercisable, December 31, 2020 2,660,637 $ 4.41 8.9 $ 48,104 |
PUBLIC AND PRIVATE PLACEMENT WA
PUBLIC AND PRIVATE PLACEMENT WARRANTS | 12 Months Ended |
Dec. 31, 2020 | |
PUBLIC AND PRIVATE PLACEMENT WARRANTS | |
PUBLIC AND PRIVATE PLACEMENT WARRANTS | 10. PUBLIC AND PRIVATE PLACEMENT WARRANTS In February 2019, in connection with the RMG IPO, RMG issued 7,666,648 warrants (the “Public Warrants”) to purchase shares of Common Stock at $11.50 per share. Simultaneously with the consummation of the RMG IPO, RMG issued 4,600,000 warrants (the “Private Placement Warrants” and, together with the Public Warrants, the “Public and Private Placement Warrants”) to purchase shares of Common Stock at $11.50 per share, to RMG Sponsor, LLC (the “Sponsor”) and certain funds and accounts managed by subsidiaries of BlackRock, Inc. and certain funds and accounts managed by Alta Fundamental Advisers LLC (together, the “Anchor Investors”). All of the Public and Private Placement Warrants were outstanding as of December 31, 2020. The Public and Private Placement Warrants may only be exercised for a whole number of shares. In January 2021 we filed a registration statement for, among other things, the registration, under the Securities Act of 1933, as amended, of the issuance of Common Stock issuable upon exercise of the Public and Private Placement Warrants. The Public and Private Placement Warrants are governed by the terms of that certain Warrant Agreement, dated February 7, 2019 (the “Warrant Agreement”), between the Company and American Stock Transfer & Trust Company, LLC (the “Warrant Agent”). We may call the Public Warrants for redemption: ● in whole and not in part; ● at a price of $0.01 per warrant; ● upon a minimum of 30 days ’ prior written notice of redemption; and ● if, and only if, the last reported sale price of our Common Stock equals or exceeds $18.00 per share for any 20 trading days within a 30-day trading period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. Additionally, commencing ninety days after the Public Warrants become exercisable, we may redeem the outstanding Public Warrants in whole and not in part, for the number of shares of Common Stock determined by the table set forth in the Warrant Agreement. If the Company calls the Public Warrants for redemption, we will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the Warrant Agreement. The Private Placement Warrants are identical to Public Warrants except that the Private Placement Warrants: (i) are not redeemable by us and (ii) may be exercised for cash or on a cashless basis, so long as they are held by the initial purchasers or any of their permitted transferees. If the Private Placement Warrants are held by holders other than the initial purchasers or any of their permitted transferees, they will be redeemable by us and exercisable by the holders on the same basis as the Public Warrants. The initial purchasers of the Private Placement Warrants have agreed not to transfer, assign or sell any of the Private Placement Warrants, including the Common Stock issuable upon exercise of the Private Placement Warrants (except to certain permitted transferees), until thirty days after the closing date of the Business Combination. The exercise price and number of shares of Common Stock issuable upon exercise of the Public and Private Placement Warrants may be adjusted in certain circumstances including in the event of a share capitalization, or recapitalization, reorganization, merger or consolidation. The exercise price of the Public and Private Placement Warrants would have adjusted if in connection with the closing of the Business Combination, we issued additional shares of Common Stock or securities convertible into or exercisable or exchangeable for shares of Common Stock for capital raising purposes at an issue price or effective issue price of less than $9.20 per share. The Public and Private Placement Warrant exercise price would be adjusted to be equal to 115% of the price received in the new issuance. In connection with the Business Combination, we did not issue any additional shares of common stock for capital raising purposes at an issue price or effective issue price of less than $9.20 per share, therefore the price reset provision was not triggered. On February 16, 2021, we announced the redemption of all of the outstanding Public Warrants to purchase shares of our Common Stock, that were issued under the Warrant Agreement. All Public Warrants could be exercised until April 5, 2021 to purchase shares of our Common Stock, at the exercise price of $11.50 per share. After 5:00pm on April 5, 2021, any Public Warrants that remained unexercised were void and no longer exercisable, and the holders of the Public Warrants received the redemption price of $0.01 per Public Warrant. Prior to the expiration of the notice of redemption 442,695 Public Warrants were exercised and the remaining 7,223,683 Public Warrants were cancelled in connection with our notice of redemption. The Company paid Public Warrant holders a total of $72,236.83 in connection with our notice of redemption. As noted in Noted in Note 2 of these financial statements, the Public and Private Placement warrants are recorded as liabilities in our consolidated financial statements. |
PREFERRED STOCK
PREFERRED STOCK | 12 Months Ended |
Dec. 31, 2020 | |
PREFERRED STOCK | |
PREFERRED STOCK | 11. PREFERRED STOCK In May and June 2019, Legacy Romeo closed a Series A preferred stock round of financing that included $56.49 million in cash investment, net of our investment in the Joint Venture and issuance costs, and $31.85 million in converted debt and accrued but unpaid interest. In connection with the Business Combination the shares of Series A preferred stock were exchanged for shares of Common Stock, as if they had converted to Legacy Romeo Class A common stock immediately prior to the Business Combination. For presentation purposes the exchange for Common Stock is deemed to have occurred in May and June 2019. Also, in connection with the Series A preferred stock financing, Legacy Romeo redeemed 35.45% of each Series Seed stockholder’s shares of Series Seed preferred stock issued and outstanding totaling $8.14 million. The Series Seed preferred stock was not mandatorily redeemable in advance of the Series A preferred stock sale. In connection with the execution of the Series A preferred stock purchase agreement, the Series Seed stockholders agreed to the redemption. In April and May 2020, Legacy Romeo closed the Series A-5 preferred stock round of financing that raised $4.00 million in cash investment. In connection with the Business Combination the shares of Series A preferred stock were exchanged for shares of Common Stock, as if they had converted to Legacy Romeo Class A common stock immediately prior to the Business Combination. For presentation purposes the exchange for Common Stock is deemed to have occurred in May 2020. |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
EQUITY | |
EQUITY | 12. EQUITY We are authorized to issue two classes of capital stock, Common Stock and preferred stock. The total number of shares that we are authorized to issue is 260,000,000 of which, 250,000,000 shares shall be Common Stock and 10,000,000 shares shall be preferred stock. Our board of directors is authorized to issue shares of preferred stock, with such designations, voting and other rights and preferences as they may determine. As of December 31, 2020 and 2019, there were no shares of preferred stock issued |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2020 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | 13. STOCK-BASED COMPENSATION 2016 Stock Plan In October 2016, we adopted the 2016 Stock Plan (the “2016 Plan”), as amended in February 2017. The 2016 Plan allowed for the issuance of both incentive stock option and nonqualified stock options. Following the Business Combination the outstanding stock options issued under the 2016 Plan may be exercised (subject to their original vesting, exercise and other terms and conditions) to purchase a number of shares of Common Stock equal to the number of shares of Legacy Romeo common stock subject to such Legacy Romeo options multiplied by the Exchange Ratio (rounded down to the nearest whole share) at an exercise price per share divided by the Exchange Ratio (rounded up to the nearest whole cent). The information presented herein is as if the exchange of stock options and Common Stock occurred as of the earliest period presented. In October 2016, we entered into a Restricted Stock Purchase Agreement with individuals and issued shares of Legacy Romeo Class B common stock which vested over three years from the issuance date. During 2019, we recognized $0.04 million of stock-based compensation expense. As of December 31, 2019, all of the Legacy Romeo Class B common stock issued under the Restricted Stock Purchase Agreement had either vested or been cancelled. The following table presents the activity related to the restricted shares of Legacy Romeo Class B common stock for the years ended December 31, 2020 and 2019, as if they were exchanged for shares of Common Stock as of the earliest period presented: Number of Restricted Class B Shares Outstanding restricted shares, January 1, 2019 95,558 Cancelled (5,072) Shares vested (90,486) Outstanding restricted shares, December 31, 2019 — Shares vested — Cancelled — Outstanding restricted shares, December 31, 2020 — Time based-awards During 2020, we issued stock options to purchase a total of 1,880,369 shares of our Common Stock, including a grant of 973,839 stock options awards to our Chief Executive Officer ("CEO") which vests over a one-year period based on service and a grant of 121,730 stock option awards to a non-employee for services rendered in connection with the Business Combination, which vested on December 29, 2020, the date of the Business Combination. Generally, our stock options vest over three years 1/36 The fair value of the time-based stock options granted during the years ended December 31, 2020 and 2019 was determined using the following assumptions: Fair Value Assumptions 2020 2019 Risk-free interest rate 0.12% - 0.92% 1.95% and 2.28% Expected term (in years) 5.5 - 6.5 6.5 Expected volatility 60% - 77% 71% and 87% Dividend yield 0% 0% Grant date fair value per share $1.44 - $8.63 $1.39 and $1.56 The following table summarizes our time-based stock option activity (dollars in thousands, except weighted average exercise prices): Weighted- Weighted- Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding Options, January 1, 2019 4,687,440 $ 4.44 8.7 $ — Granted 1,765,529 2.63 Exercised (9,476) 4.35 — Cancelled (1,352,488) 4.27 Outstanding Options, December 31, 2019 5,091,005 $ 3.94 8.5 $ — Exercisable and vested, December 31, 2019 3,555,792 $ 4.27 8.2 $ — Weighted- Weighted- Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding Options, January 1, 2020 5,091,005 $ 3.94 8.5 $ — Granted 1,880,369 5.06 Exercised (185,474) 3.58 3,131 Cancelled (276,309) 2.53 Outstanding Options, December 31, 2020 6,509,591 $ 4.26 6.91 $ 118,657 Exercisable and vested, December 31, 2020 4,750,524 $ 4.22 6.06 $ 86,702 Performance and market-based award In August 2020, we awarded 4,633,978 stock options to our then Chairman and CEO at an exercise price of $6.69 per share. All of the shares covered by such award are subject to time based, performance and market condition vesting requirements. As of December 29, 2020, the date of the Business Combination, the performance condition was satisfied, and we began recognizing stock-based compensation expense based upon the grant date fair value of the award. We will recognize the stock-based compensation expense over the requisite service period, which is six months from the date of the Business Combination. We estimated the grant date fair value of the award to be $9.63 million, which was determined using a Monte Carlo simulation with the assistance of an independent third-party valuation firm. The number of shares that will be exercisable, if any, is determined solely by the value of our share price at the expiration of the six-month lockup period assigned to Legacy Romeo stockholders in connection with the Business Combination, which is June 27, 2021. The number of shares that may become exercisable is set forth in the table below: Cumulative Number of Share Price Shares $6.6869 - $8.9452 926,795 $8.9453 - $11.9272 1,853,591 $11.9273 - $14.9092 3,243,781 $14.9093 4,633,978 As of December 31, 2020, the performance and market-based award is not exercisable and 4,633,978 stock options related to the performance and market-based award are outstanding. As of December 31, 2020, the intrinsic value of the performance and market-based award is $15.80 per share, with an aggregate intrinsic value ranging from $14.64 million to $73.22 million. Stock-based compensation expense During the year ended December 31, 2020, we recognized a total of $3.57 million of stock-based compensation expense related to the vesting of stock options. As of December 31, 2020, there is a total of $6.44 million in unrecorded compensation expense related to 1,759,067 unvested time-based awards. As of December 31, 2020, there is a total of $9.47 million in unrecorded compensation expense related to the performance and market-based award, with a maximum of 4,633,978 shares becoming exercisable. The following table summarizes our stock-based compensation expense by line item for the years ended December 31, 2020 and 2019, in the consolidated statements of operations (in thousands): 2020 2019 Cost of revenues $ 203 $ 218 Selling, general, and administrative 3,364 1,348 Total $ 3,567 $ 1,566 From 2015 through 2018, we issued warrants for the purchase of shares of Legacy Romeo Class A common stock in exchange for historical services provided. We utilized a Black-Scholes option-pricing model to determine the fair value of each warrant, which was recorded as compensation expense immediately, as the warrants were immediately exercisable. There was no expense for warrants related to services provided for the year ended December 31, 2020 and 2019. The following table presents a summary of activity for the warrants issued for services provided (dollars in thousands, except weighted average exercise prices): Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price Contractual Intrinsic Warrant activity and other data: Warrants per Share Life (Years) Value Warrants outstanding, January 1, 2020 1,083,413 $ 3.94 7.8 $ — Granted — — Exercised (405,702) 2.30 $ 4,553 Forfeited (146,394) 3.58 Expired — — Warrants outstanding, December 31, 2020 531,317 $ 5.37 10.4 $ 9,096 Warrants outstanding exercisable, December 31, 2020 531,317 $ 5.37 10.4 $ 9,096 2020 Stock Plan On December 29, 2020, our stockholders approved the 2020 Long-Term Incentive Plan. The purpose of the 2020 Long-Term Incentive Plan is to attract, retain, incentivize and reward top talent through stock ownership, to improve operating and financial performance and strengthen the mutuality of interest between eligible service providers and stockholders. The 2020 Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, dividend equivalent rights, and performance-based stock awards (collectively, “stock awards”) and cash awards. Incentive stock options may be granted only to our employees, including officers, and the employees of our subsidiaries. All other stock awards and cash awards may be granted to our employees, officers, non-employee directors, and consultants and the employees and consultants of our subsidiaries and affiliates. The aggregate number of shares of our Common Stock that may be issued pursuant to stock awards under the 2020 Long-Term Incentive Plan will not exceed the sum of (x) 15,000,000 shares, plus (y) 11,290,900, the number of shares subject to outstanding awards under the 2016 Plan on the date of the Business Combination. As of December 31, 2020, no awards have been granted and no shares of our Common Stock have been issued under the 2020 Plan. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | 14. INCOME TAXES The provision for income taxes was as follows for the years ended December 31, 2020 and 2019 (in thousands): 2020 2019 Current: Federal $ — $ — State 2 1 Total current 2 1 Total deferred — — Total provision for income taxes $ 2 $ 1 The following table presents the reconciliation of the federal statutory rate to the effective tax rate as of December 31, 2020 and 2019: Year Ended December 31, 2020 2019 Federal statutory rate 21.0 % 21.0 % State statutory rate, net of federal tax benefit 31.5 4.4 Federal and state tax credits 15.8 3.6 Stock-based compensation (1.6) (0.2) Valuation allowance adjustments (176.2) (22.9) Purchase money debt reduction (10.7) — Deductible transaction costs 29.1 — Change in fair market value of warrants 94.2 Interest expense on converted debt — (3.9) Loss on extinguishment on converted debt — (1.0) Loss from joint venture — (0.6) Others (3.1) (0.4) Effective tax rate — % — % The following table presents the principal components of deferred tax assets and liabilities as of December 31, 2020 and 2019 (in thousands): Year Ended December 31, 2020 2019 Deferred tax asset: Accrued expense $ 955 $ 1,975 Investment in joint venture 88 — Operating lease liabilities 1,543 — Stock-based compensation 1,239 667 Tax credits 6,771 8,191 Net operating loss carryforwards 49,583 34,419 Total deferred tax asset 60,179 45,252 Deferred tax liability: Property, plant and equipment (386) (465) Operating lease right of use assets (1,507) — Total deferred tax liability (1,893) (465) Net deferred tax asset 58,286 44,787 Valuation allowance (58,286) (44,787) Net deferred tax liability $ — $ — Deferred income taxes reflect the net effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the tax-basis amounts used for income tax purposes. In assessing the realizability of deferred tax assets, management considered whether it is more likely than not that some portion or all the deferred tax assets will be realized. The realization of deferred tax assets may be dependent on our ability to generate sufficient income in future years in the associated jurisdiction to which the deferred tax asset relates. As of December 31, 2020, and 2019, we recorded a valuation allowance of $58.29 million and $44.79 million, respectively, against the deferred tax asset balance as realization is uncertain due to a history of operating losses. As of December 31, 2020, and 2019, we had federal net operating loss carryforwards of $182.23 million and $123.48 million and state net operating loss carryforwards of $219.13 million and $121.54 million, respectively. Approximately $44.8 million of the federal net operating losses may be carried forward for 20 years and begin to expire in 2034, the remaining $137.3 million do not expire and carried forward indefinitely. State net operating losses begin to expire in 2036. Utilization of the net operation loss carryforward and research credit carryforward may be subject to an annual limitation due to the ownership percentage change limitations under Section 382, provided by the Internal Revenue Code of 1986, and similar state provisions. The annual limitation may result in the expiration of some net operating losses before utilization. The Company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The Company is not currently under examination in any taxing jurisdiction and generally is no longer subject to examination for tax years prior to 2017. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits for the years ended December 31, 2020 and 2019: As of December 31 2020 2019 Unrecognized tax benefits – $ — $ — Increase – 1,603 — Increase – 266 — Settlements — — Statute of limitations expiration — — Unrecognized tax benefits – $ 1,869 $ — Included in the balance of unrecognized tax benefits as of December 31, 2020 and 2019 are $1,869 and $0, respectively, of tax benefits that, if recognized, would affect the effective tax rate, absent any corresponding changes to the valuation allowance. We recognize interest and penalties related to unrecognized tax benefits in operating expenses. No such interest and penalties were recognized during the years ended December 31, 2020 and 2019. |
LOSS PER SHARE
LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
LOSS PER SHARE | 15. LOSS PER SHARE The basic and diluted net loss per share is computed by dividing net loss by the weighted average shares outstanding during the period. The calculation of basic and diluted net loss per share for the years ended December 31, 2020 and 2019 is presented below (in thousands, except share and per share data): 2020 2019 Net loss $ (7,617) $ (59,854) Weighted average common shares outstanding – basic 77,741,339 58,793,480 Dilutive effect of potentially issuable shares — — Weighted average common shares outstanding – diluted 77,741,339 58,793,480 Basic loss per share $ (0.10) $ (1.02) Diluted loss per share $ (0.10) $ (1.02) Antidilutive shares excluded from the calculation of diluted loss per share were 26,602,189 and 21,873,178 as of December 31, 2020 and 2019. Potentially dilutive shares that have been excluded from the determination of diluted loss per share include stock options and warrants to purchase our Common Stock. As the inclusion of common stock share equivalents in the calculation would be anti-dilutive for all periods presented, diluted net loss per share is the same as basic net loss per share. |
INFORMATION ON BUSINESS SEGMENT
INFORMATION ON BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2020 | |
INFORMATION ON BUSINESS SEGMENTS | |
INFORMATION ON BUSINESS SEGMENTS | 16. INFORMATION ON BUSINESS SEGMENTS We have two operating segments, which are also reportable segments. Our reportable segments are presented based on how information is used by our Chief Operating Decision Maker (“CODM”), which is collectively a senior leadership team consisting of two individuals, to measure performance and allocate resources. These reportable segments are Romeo Power North America and Joint Venture Support. The activities of our Romeo Power North America reportable segment include the research, design, development, and manufacture of electrical power systems for commercial vehicles (Class 6-8: trucks and buses) in the North American market. Our Joint Venture Support reportable segment provides design, research and development, and other engineering related services exclusively to the Joint Venture. We commenced providing services to the joint venture on the formation date of June 28, 2019 and as a result, our 2019 results include services rendered to the Joint Venture from the June 28, 2019 joint venture formation date through December 31, 2019. The CODM evaluates and monitors segment performance primarily based upon segment sales and gross profit. Asset information has not been separately disclosed for the segments, as this information is not regularly reported to CODM for purposes of allocation of resources to our segments or assessing segment performance. Net revenues and gross profit from each of our reportable segments are as follows (in thousands): Year Ended December 31, 2020 2019 Net revenues: Romeo Power North America $ 5,832 $ 6,512 Joint Venture Support 3,142 1,976 Total net revenues $ 8,974 $ 8,488 Gross profit (loss): Romeo Power North America $ (9,502) $ (9,068) Joint Venture Support 511 319 Total business segment gross profit (loss) $ (8,991) $ (8,749) All of our revenues (based on location of customer) and long-lived assets were within North America for the years ended December 31, 2020 and 2019. |
TRANSACTIONS WITH RELATED PARTI
TRANSACTIONS WITH RELATED PARTIES | 12 Months Ended |
Dec. 31, 2020 | |
TRANSACTIONS WITH RELATED PARTIES | |
TRANSACTIONS WITH RELATED PARTIES | 17. TRANSACTIONS WITH RELATED PARTIES Notes Receivable from Stockholders During the year ended December 31, 2019, we allowed two stockholders to exercise outstanding warrants in exchange for notes receivable as presented below (in thousands): Principal Amount Maturity Date Stockholder 1 $ 4,562 July 7, 2022 Stockholder 2 4,561 August 19, 2022 Total $ 9,123 Each loan accrued interest at 2% and was due and payable, including all accrued and unpaid interest, at maturity. Amounts due under these arrangements would become immediately due and payable in the event of the closing of a firm commitment underwritten public offering or certain capital transactions that are considered a liquidation transaction. In April 2020, in consideration of ongoing substantial financial support provided between 2017 and the first quarter of 2020, our Board of Directors agreed to cancel $1.79 million of the $9.12 million stockholder note receivable, in the event of a sale of the Company, an initial public offering or a reverse recapitalization. In December 2020, in connection with an early repayment of the note receivable, our Board of Directors agreed to cancel an additional $2.02 million stockholder note receivable. The stockholders repaid $5.31 million and as of December 31, 2020 no additional stockholder notes receivable remain outstanding. We recorded the amounts forgiven of $3.81 million in Other Expense in our consolidated statement of operations for the year-ended December 31, 2020. Transactions with Employees and Directors December 31, 2020 2019 Convertible notes $ — $ 3,000 Term notes — 100 Total $ — $ 3,100 In May 2019, our then Chairman and CEO invested $6.78 million to purchase Legacy Romeo’s Series A preferred stock. Additionally our then Chairman and CEO and our CFO converted $1.51 million in convertible and term Notes into shares of Legacy Romeo’s Series A preferred stock in connection with Legacy Romeo’s Series A financing (Note 11) at a price per share equal to the fair value of the stock issued. In connection with the Business Combination the shares purchased or converted by these employees were exchanged for shares of Common Stock, as if they had converted to Legacy Romeo Class A common stock immediately prior to the Business Combination. For presentation purposes the exchange for Common Stock is deemed to have occurred in May 2019. During the year-ended December 31, 2019, we borrowed an additional $5.24 million from our then Chairman and CEO and our CFO through a series of term notes and re-paid $10.86 million in aggregate indebtedness to these employees. As of December 31, 2019, the term notes outstanding were included in current maturities of long-term debt to related parties. In the first fiscal quarter of 2020, we issued term notes to our then Chairman and CEO totaling $0.75 million with a 1-year 1-year In connection with the Business Combination we repaid all issued and outstanding term notes, including accrued but unpaid interest. Short-term and Long-term Debt with Stockholders December 31, 2020 2019 Convertible notes* $ — $ 2,000 Term notes* — 100 Total $ — $ 2,100 * Includes amounts due to our then Chairman and CEO In connection with the Business Combination, all of our convertible notes converted into shares of Common Stock as if they had converted to shares of Legacy Romeo Class A common stock immediately prior to the Business Combination and we repaid all issued and outstanding term notes, including accrued interest. As of December 31, 2019, $0.1 million of the outstanding convertible and term notes were included in current maturities of long-term debt to related parties and $2.00 million were included in Long-term debt – net of current potion. Transactions with BorgWarner and the Joint Venture In connection with Legacy Romeo’s investment in the Joint Venture formed on June 28, 2019 (Note 8), Legacy Romeo entered into a services agreement to provide various professional services to the Joint Venture. Revenue earned for services rendered during the years ended December 31, 2020 and 2019 was $3.14 million and $1.98 million of which all amounts have been collected as of December 31, 2020. Transactions with Heritage Environmental Services and its related parties In connection with the Battery Recycling Arrangement, we also agreed to fund up to $10.00 million to purchase ten battery electric vehicle (“BEV”) trucks and the charging infrastructure for a one-year pilot program to determine the feasibility of transitioning HES’s or its affiliates’ fleet of trucks from diesel powered vehicles to BEVs. If such pilot program is successful, the parties would enter into an agreement for the procurement through us of at least 500 BEVs on terms acceptable to HBR, HES and us. The participants in the pilot program have been selected and the parties are beginning to work towards an agreement to support the pilot program. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 18. COMMITMENTS AND CONTINGENCIES Litigation A stockholder purchased shares of Legacy Romeo’s common stock through a group of related entities during 2017, at a time when we were heavily focused on developing our stationary energy storage business in parallel with our commercial vehicle battery platform. Legacy Romeo completed its Series A preferred stock financing in May 2019 at a price per share that was lower than the purchase price paid by the stockholder for its common stock in 2017. During this time, we also paused our stationary energy storage business in order to focus resources on scaling production of commercial vehicle batteries, which was not our intention during 2017. This stockholder subsequently claimed that he and his related entities overpaid for Legacy Romeo’s common stock during 2017 and that our subsequent course of action was not in line with the 2017 projections. In order to settle the stockholder’s claim, during November 2019, we entered into a confidential settlement agreement with the stockholder to resolve the dispute. As a result of the settlement agreement, we rescinded the share purchase transaction and made a cash payment to the former shareholder. The amount paid in excess of the estimated fair value of the shares that were rescinded resulted in the recognition of $4.59 million of settlement expense, which is reported as Legal settlement expense on the consolidated statement of operations for the year-ended December 31, 2019. A police officer was injured as a result of an automobile accident resulting from an intoxicated Romeo employee driving following his departure from a 2017 company holiday party that occurred after hours and not on our premises. We terminated the employee’s employment shortly after the incident occurred. This matter resulted in a personal injury lawsuit ( Chelico et al. v. Romeo Systems, Inc., et al. In October 2020, a wage-and-hour class action was filed in Los Angeles Superior Court on behalf of all current and former non-exempt employees in California from October 2016 to present. The allegations include meal and rest period violations and various related claims. The case is currently stayed pending the initial status conference, which was continued to July 2021. We intend to defend ourself against these claims and the possible range of loss, if any, cannot currently be estimated. |
MAJOR CUSTOMERS AND ACCOUNTS RE
MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2020 | |
MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE | |
MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE | 19. MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE We had certain customers whose revenue individually represented 10% or more of our total revenue, or whose accounts receivable balances individually represented 10% or more of our total accounts receivable, as follows: For the year ended December 31, 2020, two customers accounted for 55% of total revenue and the Joint Venture engineering services accounted for 35% of total revenue. As it relates to the two customers for the year ended December 31, 2020, the total percentage of revenue for each customer was 28%, and 27%. For the year ended December 31, 2019, two customers accounted for approximately 74% of total revenue and the Joint Venture engineering services revenue accounted for 23% of total revenue. Of the two customers for the year ended December 31, 2019, one customer accounted for approximately 59% and the second customer accounted for 15%. As of December 31, 2020, two customers accounted for approximately 26% of accounts receivable and the Joint Venture engineering services accounted for 44% of accounts receivable. As it relates to the two customers as of December 31, 2020, the total percentage of accounts receivable for each customer was 13% and 13%. As of December 31, 2019, four customers accounted for 98% of accounts receivable. As it relates to the four customers as of December 31, 2019, the total percentage of accounts receivable for each customer was 34%, 22%, 21% and 21%. The major customers identified are included in the Romeo Power North America operating segment, and the JV shared services amounts are included in the Joint Venture Support operating segment. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 20. SUBSEQUENT EVENTS On January 21, 2021, we contributed an additional $4.00 million to the Joint Venture. On February 16, 2021, we announced the redemption of all the outstanding Public Warrants to purchase shares of our Common Stock, that were issued under the Warrant Agreement, dated February 7, 2019, by and between RMG and American Stock Transfer & Trust Company, LLC, as warrant agent, as part of the units sold in the initial public offering of RMG. All Public Warrants could be exercised until April 5, 2021 to purchase shares of our Common Stock, at the exercise price of $11.50 per share. After 5:00pm on April 5, 2021, any Public Warrants that remained unexercised are void and no longer exercisable, and the holders of the Public Warrants received the redemption price of $0.01 per Public Warrant. Prior to the expiration of the notice of redemption 442,695 Public Warrants were exercised and the remaining 7,223,683 Public Warrants were cancelled in connection with our notice of redemption. The Company paid Public Warrant holders a total of $72,236.83 in connection with our notice of redemption. On April 6, 2021 we announced a long-term supply agreement with Paccar, Inc. (“PACCAR”). Under the agreement we will be a battery supplier for Peterbilt 579 and 520 BEVs in the United States and Canada through 2025. The start of production is anticipated to begin after 2021. In connection with the long-term supply agreement, we issued PACCAR 650,000 shares of our Common Stock. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation | Principles of Consolidation Consolidations |
Use of Estimates | Use of Estimates |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Restricted Cash | Restricted Cash |
Accounts Receivable, Net of Allowance for Expected Credit Losses | Accounts Receivable, Net of Allowance for Expected Credit Losses After all attempts to collect an accounts receivable balance have failed, the accounts receivable balance is written off against the allowance for doubtful accounts. As of December 31, 2020 and 2019, we reported an allowance for doubtful accounts balance of $0.24 million. |
Leases | Leases ROU lease assets represent our right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments. Both the ROU lease asset and operating lease liability are recognized as of the lease commencement date based on the present value of the lease payments over the lease term. Our leases do not provide an implicit borrowing rate that can readily be determined. Therefore, we apply a discount rate based on the incremental borrowing rate, which is determined using the credit rating and other information available as of the lease commencement date. ROU lease assets also include any lease payments made before their contractual due dates and exclude any lease incentives. Our lease agreements may include options to extend the lease term or to terminate the lease early. We include options to extend or terminate leases upon determination of the ROU lease asset and lease liability when it is reasonably certain that we will exercise these options. Operating lease expense attributable to lease payments is recognized on a straight-line basis over the lease term and is included in cost of revenues and selling, general, and administrative expense on our consolidated statement of operations. Finance leases result in the recognition of depreciation expense, which is recognized on a straight-line basis over the expected life of the leased asset, and interest expense, which is recognized following an effective interest rate method. Depreciation expense attributable to finance leases is included in cost of revenues on our consolidated statement of operations. We have lease arrangements that include lease and non-lease components. The non-lease components in the arrangements are not significant when compared to the lease components. For all leases, we account for the lease and non-lease components as a single component. Additionally, for certain equipment leases, management applies a portfolio approach to effectively account for the ROU lease assets and lease liabilities. We evaluate ROU lease assets for impairment consistent under the impairment of long-lived assets policy. |
Inventory | Inventory |
Property, Plant and Equipment | Property, Plant and Equipment Betterments, renewals, and repairs that extend the useful life of the asset are capitalized. Other repairs and maintenance charges are expensed as incurred. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation and amortization are eliminated from our accounts, and any resulting gain or loss is recognized in the accompanying consolidated statement of operations. Depreciation and amortization are computed using the following estimated useful lives of the assets: Asset Years Production and test equipment 7 Furniture and fixtures 7 Tooling 5 Automobiles 5 Computer equipment 4 Software 3 |
Equity Method Investments | Equity Method Investments |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets |
Revenue Recognition | Revenue Recognition Revenue from Contracts with Customers 1. identifying the contract with a customer; 2. identifying the performance obligations in the contract; 3. determining the transaction price; 4. allocating the transaction price to the performance obligations; and 5. recognizing revenue as the performance obligations are satisfied. We recognize revenue when (or as) performance obligations are satisfied by transferring control of the performance obligation to a customer. Control of a performance obligation may transfer to the customer either at a point in time or over time depending on an evaluation of the specific facts and circumstances for each contract, including the terms and conditions of the contract as agreed with the customer, as well as the nature of the products or services to be provided. Our contracts with customers generally include either a combination of prototypes with related engineering services or product sales. For product sales, the primary performance obligation to our customers is the delivery of finished goods and products under associated purchase orders. Control of the products sold typically transfers at a point in time upon delivery to the customer’s warehouse or at transportation shipping point, based upon when title of ownership passes to the customer under the terms and conditions of the arrangement. Each customer purchase order sets forth the transaction price for the products and services purchased under the arrangement. For contracts with multiple performance obligations, we evaluate whether the stated selling prices for the products or services represent their standalone selling prices. When it is necessary to allocate the transaction price to multiple performance obligations (i.e. for customized solutions unique to a customer’s specifications), management typically uses the expected cost plus a reasonable profit margin to estimate the standalone selling price of each product or service. For standard products and services with observable sales transactions, the observable sales transactions are used to determine the standalone selling price. Some customer arrangements include variable consideration, such as volume discounts, some of which depend upon the customers meeting specified performance criteria, such as a purchasing level over a period of time. We use judgment to estimate the most likely amount of variable consideration at customer contract inception and then again at each reporting date. When estimating variable consideration, we also apply judgment when considering the probability of whether a reversal of revenue could occur and only recognizes revenue subject to this constraint. Customer arrangements that include the provision of developed or customized products that require the bundling of promises, such as providing non-recurring engineering and development services that lead to a prototype, are combined into a single performance obligation because the individual products and services that are required to fulfill the customer requirements do not meet the criteria for a distinct performance obligation. These customized products generally have no alternative use to Romeo and are recognized over time or at a point in time depending on whether the terms and conditions of these arrangements give us the enforceable right to payment for performance completed to date, including a reasonable profit margin. For arrangements that provide an enforceable right to payment, control transfers over time and we measure progress towards completion by selecting the input or output method that best depicts the transfer of control of the underlying goods and services to the customer for each respective arrangement. Methods we use to measure progress toward completion include the use of a percentage of completion cost-to-cost measure of progress because it best depicts the transfer of control to the customer as we incur costs on our contracts. Under the percentage-of- completion cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs to complete the performance obligation(s). For arrangements where no enforceable right to payment exists, we will recognize revenue at a point in time based on the title transfer of the final prototype or specified product. We also provide services to the Joint Venture under separate work orders and contractual arrangements. These services include a single performance obligation for non-recurring and other engineering services, which are provided at cost incurred plus a fixed fee percentage. Revenue for these services is recognized over time, based on costs incurred or the right to invoice method (i.e., in situations where the value transferred matches the billing rights), as the customer receives and consumes the benefits. Our typical payment terms are 30–60 days, and sales arrangements do not include any significant financing components for its customers. Any payments that are received from a customer in advance of satisfaction of a related performance obligation, as well as billings in excess of revenue recognized, are deferred and treated as a contract liability. Advance payments and billings in excess of revenue recognized are classified as current or non- current contract liabilities based on the timing of when the recognition of revenue is expected. Freight charges billed to customers are included in sales, and the related shipping costs are included in cost of revenues on the consolidated statements of operations. If shipping activities are performed after a customer obtains control of a product, we apply a policy election under ASC 606 to account for shipping as an activity to fulfill the promise to transfer the product to the customer. We also apply a policy election to exclude transaction taxes collected from customers from sales when the tax is both imposed on and concurrent with a specific revenue-producing transaction. We generally provide customers with a product warranty that assures that the products meet standard specifications and are free of defects. Claims incurred under our standard product warranty programs are recorded based on open claims and historical experience, which have not been significant and were not significant for the years ended December 31, 2020 and 2019. |
Cost of Revenues | Cost of Revenues costs; depreciation and amortization; lease costs; and freight and shipping costs. Costs are expensed as incurred, or as control of products is transferred, except for costs incurred to fulfill a contract, which are capitalized and amortized on a straight-line basis over the expected period of performance. We do not incur significant incremental costs to acquire contracts. |
Research and Development | Research and Development |
Other Costs | Other Costs |
Income Taxes | Income Taxes We record a valuation allowance, when necessary, to reduce deferred tax assets to the amount expected to be realized. Estimates of the realizability of deferred tax assets, as well as our assessment of whether an established valuation allowance should be reversed, are based on projected future taxable income, the expected timing of the reversal of deferred tax liabilities, and tax planning strategies. When evaluating whether projected future taxable income will support the realization of our deferred tax assets, we consider both our historical financial performance and general economic conditions. In addition, we consider the time frame over which it would take us to utilize the deferred tax assets prior to their expiration. We utilize a two-step approach to recognizing and measuring uncertain income tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained upon examination by the Internal Revenue Service (IRS) or other taxing authorities, including resolution of related appeals or litigation processes. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. We consider many factors when evaluating and estimating tax positions and tax benefits, which may require periodic adjustments and may not accurately forecast actual outcomes. As more fully described in note 14, management determined as of December 31, 2020 that a portion of the deferred tax benefit related to federal and state research tax credits is not more likely than not to be sustained upon examination. |
Basic and Diluted Loss Per Share | Basic and Diluted Loss Per Share Earnings per Share. |
Stock-Based Compensation | Stock-Based Compensation The estimated fair value of stock options and warrants, excluding market-based awards is estimated on the grant date using the Black-Scholes option-pricing model. The fair value of restricted stock awards granted prior to there being a public market for our stock, was measured based on the grant date estimated fair value of our common stock. The Black-Scholes option-pricing model requires inputs such as the fair value of our common stock, the risk-free interest rate, expected term, expected dividend yield and expected volatility. The most significant assumption used in determining the fair value of stock-based awards, granted prior to there being a public market for our stock, was the estimated fair value of common stock on the date of grant. Prior to there being a public market for our stock, in order the determine the fair value of the common stock on the date of grant, a valuation analysis was performed by management, with the assistance of a third-party valuation firm, using a combination of market and income approaches. The risk-free interest rate assumption is determined by using the U.S. Treasury rates of the same period as the expected option term of each stock option. We use the simplified method to calculate the expected term. The dividend yield assumption is based on the dividends expected to be paid over the expected life of the stock option. Our volatility is derived from several publicly traded peer companies. We estimate the grant date fair value of awards with market conditions using a Monte Carlo simulation or other appropriate fair value method with the assistance of an independent third-party valuation firm. |
Convertible Notes | Convertible Notes If the conversion feature did not require recognition as a bifurcated derivative, the convertible debt instrument was evaluated for consideration of any beneficial conversion feature (“BCF”) requiring separate recognition. We assessed the existence of a BCF based upon a comparison of a convertible debt instrument’s effective conversion price (e.g., after allocation of a portion of debt proceeds to other freestanding or embedded features) to the commitment date fair value of the equity into which the debt instrument was convertible. When we recorded a BCF, the intrinsic value of the BCF was recorded as a debt discount against the face amount of the respective debt instrument, with an offset to additional paid-in capital. The debt discount attributable to the intrinsic value of the BCF was subsequently amortized to interest expense over the life of the debt. In certain instances, the ultimate conversion price attributable to our convertible notes was contingent on future events not certain to occur. In these cases, any contingent beneficial conversion feature was measured using the commitment date fair value of the equity into which the notes are convertible; however, we do not recognize the incremental intrinsic value that may result from a change in the conversion price until the contingencies are resolved. In connection with the Business Combination, all of our issued and outstanding convertible notes and accrued but unpaid interest converted into shares of Common Stock as if they had converted into shares of Legacy Romeo Class A common stock immediately prior to the Business Combination. Subsequent to the Business Combination, we do not expect to continue issuing convertible notes. Public and Private Placement Warrants – Derivatives and Hedging The Public and Private Placement Warrants were initially recorded at fair value on the date of the Business Combination and are subsequently adjusted to fair value at each subsequent reporting date. Changes in the fair value of these instruments are recognized within change in fair value of Public and Private Placement Warrants in the consolidated statements of operations. |
Public and Private Placement Warrants | Public and Private Placement Warrants – Derivatives and Hedging The Public and Private Placement Warrants were initially recorded at fair value on the date of the Business Combination and are subsequently adjusted to fair value at each subsequent reporting date. Changes in the fair value of these instruments are recognized within change in fair value of Public and Private Placement Warrants in the consolidated statements of operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Level 1 Inputs Level 2 Inputs Level 3 Inputs As of December 31, 2020, the fair value of cash, accounts receivable, accounts payable, accrued expenses, other payables, short-term and long-term debt obligations approximated carrying value due to their short-term maturities. Cash equivalents consist of $16.00 million highly liquid U.S. Treasury Bills and other government-backed securities purchased on December 31, 2020. The cash equivalents are valued using quoted prices in active markets and accordingly are categorized in Level 1 of the fair value hierarchy. We entered into a Battery Recycling Agreement (the “Battery Recycling Arrangement”) with Heritage Battery Recycling, LLC (“HBR”), an affiliate of Heritage Environmental Services, Inc. (“HES”). As of December 31, 2020, the carrying value of our equity method investment in the Battery Recycling Arrangement approximated the fair value and it is considered a Level 3 asset of the fair value hierarchy because determining the fair value of our investment in the Battery Recycling Arrangement required the use of significant unobservable inputs, including the expected profits, amount and timing of future cashflows, guarantees to fund future losses, and the expected margin on products in an early stage industry. Refer to Note 8 – Equity Method Investments for discussion of our equity method investment in the Battery Recycling Arrangement. The Public and Private Placement Warrants are measured at fair value on a recurring basis. The Public Warrants are traded on the NYSE and are recorded at fair value using the closing stock price as of the measurement date, and as such, represents a Level 1 fair value measurement. The Private Placement Warrants are recorded at fair value on a recurring basis using a Black-Scholes option-pricing model, and as such, represent a Level 2 fair value measurement. We will continue to adjust these liabilities for changes in fair value for the Public and Private Placement Warrants until the warrants are exercised, redeemed or cancelled. The fair value of the Private Placement Warrants is established using Level 1 and Level 2 inputs and determined using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires inputs such as the fair value of our Common Stock, the risk-free interest rate, expected term, expected dividend yield and expected volatility. The fair value of our Common Stock is considered a Level 1 input as shares of our Common Stock are freely traded on the NYSE. The risk-free interest rate assumption is determined by using the U.S. Treasury rates of the same period as the expected term of the Private Placement Warrants, which is 5 years. The dividend yield assumption is based on the dividends expected to be paid over the expected life of the warrant. Our volatility is derived from several publicly traded peer companies. The fair value of the Public Warrants and the Private Placement Warrants, which are measured on a recurring basis as of December 31, 2020 was as follows: Fair Value as of December 31, 2020 (in thousands) Total (Level 1) (Level 2) (Level 3) Financial liabilities: Public Warrants $ 71,453 $ 71,453 $ — $ — Private Placement Warrants 67,013 — 67,013 — Total financial liabilities $ 138,466 $ 71,453 $ 67,013 $ — The key assumptions used to determine the fair value of the Private Placement Warrants as of December 31, 2020 and December 29, 2020 (the date the warrants were acquired) using the Black-Scholes model were as follows: Fair Value Assumptions December 31, 2020 December 29, 2020 Risk-free interest rate 0.17% 0.17% Expected term (in years) 5 5 Expected volatility 57% 57% Dividend yield 0% 0% Fair value of common stock $ 22.49 $ 27.00 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Credit Losses on Financial Instruments Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses of Financial Instruments Financial Instruments – Credit Losses (ASC 326), Derivatives and Hedging (ASC 815), Leases (ASC 842) The Company’s financial assets that are measured in accordance with ASC 326 include accounts receivable and an insurance receivable. On January 1, 2020, receivables are recorded at amortized cost less an allowance for expected credit losses. The Company estimates the allowance for credit losses in relation to receivables based on relevant qualitative and quantitative information about historical events, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported accounts receivable. Earnings per Share , Earnings Per Share (ASC 260); Distinguishing Liabilities from Equity (ASC 480); Derivatives and Hedging (ASC 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. Leases Leases |
Accounting Pronouncements Issued, But Not Yet Adopted | Accounting Pronouncements Issued, But Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, ASC 740, “Income Taxes (ASC 740): Simplifying the Accounting for Income Taxes |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Summary of estimated useful lives of property, plant and equipment | Asset Years Production and test equipment 7 Furniture and fixtures 7 Tooling 5 Automobiles 5 Computer equipment 4 Software 3 |
Schedule of liabilities measured at fair value on a recurring basis | Fair Value as of December 31, 2020 (in thousands) Total (Level 1) (Level 2) (Level 3) Financial liabilities: Public Warrants $ 71,453 $ 71,453 $ — $ — Private Placement Warrants 67,013 — 67,013 — Total financial liabilities $ 138,466 $ 71,453 $ 67,013 $ — |
Schedule of key assumptions use to determine the fair value | Fair Value Assumptions December 31, 2020 December 29, 2020 Risk-free interest rate 0.17% 0.17% Expected term (in years) 5 5 Expected volatility 57% 57% Dividend yield 0% 0% Fair value of common stock $ 22.49 $ 27.00 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
BUSINESS COMBINATION | |
Summary of net proceeds from the Business Combination | The net proceeds from the Business Combination, as reported in the consolidated statements of cash flows for the year ended December 31, 2020, within the financing section are summarized below (in thousands): Gross proceeds $ 394,196 Less: fees paid to the RMG IPO underwriters 8,050 Less: fees paid to the underwriters 22,513 Less: other transaction costs 17,802 Net cash received from the Business Combination $ 345,831 |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
REVENUES | |
Summary of changes in contract liabilities | Contract Liabilities Balance on December 31, 2019 $ 289 Revenues recognized (3,167) Increase due to billings 3,693 Balance on December 31, 2020 $ 815 |
Schedule of disaggregation of revenue | The following table disaggregates revenues by type of products, services and segment for the years ended December 31, 2020 and 2019 (in thousands): 2020 Romeo Power Joint Venture North America Support Total Products: Modules $ 2,910 $ — $ 2,910 Packs — — — Total product revenues 2,910 — 2,910 Services: Non-recurring engineering and prototype 2,922 — 2,922 Joint Venture support — 3,142 3,142 Total service revenues 2,922 3,142 6,064 Total revenues $ 5,832 $ 3,142 $ 8,974 2019 Romeo Power Joint Venture North America Support Total Products: Modules $ 4,652 $ — $ 4,652 Packs 195 — 195 Total product revenues 4,847 — 4,847 Services: Non-recurring engineering and prototype 1,665 — 1,665 Joint Venture support — 1,976 1,976 Total service revenues 1,665 1,976 3,641 Total revenues $ 6,512 $ 1,976 $ 8,488 The following table disaggregates revenues by when control is transferred for the years ended December 31, 2020 and 2019 (in thousands): 2020 2019 Point in time $ 5,832 $ 6,512 Over time 3,142 1,976 Total $ 8,974 $ 8,488 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
PROPERTY, PLANT AND EQUIPMENT | |
Schedule of property, plant and equipment | Property, plant and equipment for the years ended December 31, 2020 and 2019, consisted of the following (in thousands): 2020 2019 Production and test equipment $ 6,291 $ 5,726 Computer equipment 847 778 Software 2,141 2,093 Tooling 912 203 Furniture and fixtures 98 97 Leasehold improvements 1,076 1,076 Automobiles 22 22 Assets not yet in service 260 753 Total property, plant and equipment 11,647 10,748 Less accumulated depreciation and amortization (6,163) (4,175) Total property, plant and equipment—net $ 5,484 $ 6,573 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LEASES | |
Schedule of components of lease expense, supplemental information and rent expenses | The components of lease expense as of December 3 1 2020 and 2019 2020 2019 Operating lease cost $ 912 $ 912 Finance lease cost: Amortization of right-of-use assets 283 62 Interest on lease liabilities 48 15 Total finance lease cost $ 331 $ 77 Supplemental cash flow information related to leases as of December 31, 2020 and 2019, was as follows (in thousands): 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 899 $ 878 Operating cash flows from finance leases 48 15 Financing cash flows from finance leases 283 31 |
Schedule of maturities of operating lease liabilities | Supplemental consolidated balance sheet information related to leases as of December 31, 2020 and 2019, was as follows (in thousands): 2020 2019 Operating leases: ROU assets-operating leases $ 5,469 $ 5,707 Lease liabilities-operating leases (current) $ 853 $ 851 Lease liabilities-operating leases (non-current) 4,723 4,949 Total lease liabilities-operating leases $ 5,576 $ 5,800 Finance leases: Other noncurrent assets $ 269 $ 551 Other current liabilities $ 282 $ 315 Other noncurrent liabilities 17 268 Total leases liabilities-finance leases $ 299 $ 583 Weighted Average Remaining Lease Term 2020 2019 Operating leases 11 years 12 years Finance leases 1 years 2 years Weighted Average Discount Rate 2020 2019 Operating leases 12.0 % 12.0 % Finance leases 11.2 % 11.2 % |
Schedule of maturities of finance lease liabilities | Maturities of lease liabilities were as follows (in thousands): Operating Finance Year Ended December 31 Leases Leases 2021 $ 901 $ 295 2022 902 19 2023 902 — 2024 902 — 2025 902 — Thereafter 5,489 — Total future minimum lease payments 9,998 314 Less imputed interest (4,422) (15) Total $ 5,576 $ 299 |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INVENTORY | |
Schedule of inventory | As of December 31, 2020, and 2019, inventory consisted of the following (in thousands): 2020 2019 Raw materials $ 4,064 $ 5,535 Work-in-process 531 462 Finished goods 342 673 Total inventories $ 4,937 $ 6,670 |
SHORT-TERM AND LONG-TERM DEBT (
SHORT-TERM AND LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
SHORT-TERM AND LONG-TERM DEBT | |
Schedule of components of short-term and long-term debt | As of December 31, 2020 and 2019, short-term and long-term debt is comprised of the following (in thousands): 2020 2019 Convertible notes: Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in December 2022. Conversion price is the lesser of the next equity financing or $0.4339 per share $ — $ 4,200 Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in December 2022. Conversion price is $0.4339 per share — 1,025 Total convertible notes — 5,225 Term Notes: Issued 2019, interest rate fixed at 1.55%. Principal and interest are payable at maturity in December 2020 — 100 Issued 2019, interest rate fixed at 8%. Principal and interest are payable at maturity in various dates in 2020 — 5,000 Total term notes — 5,100 Paycheck Protection Program: Issued June 2020, interest rate fixed at 1% . Principal and interest are due in installments starting 3,300 — Issued June 2020, interest rate fixed at 1% . Principal and interest are due in installments starting 42 — Total paycheck protection program 3,342 — Total short-term and long-term debt 3,342 10,325 Less current portion due to related parties — (100) Less current portion (2,260) (5,000) Total long-term debt $ 1,082 $ 5,225 |
Schedule of expected maturities associated with the Company's outstanding debt | December 31, 2021 $ 2,259 2022 1,053 2023 12 2024 12 2025 6 Total $ 3,342 |
Schedule of activity for the warrants issued in connection with short- term and long-term debt | Weighted Weighted Average Average Exercise Remaining Aggregate Number of Price Contractual Intrinsic Warrant Activity and Other Data Warrants Per Share Life Value Warrants Outstanding, January 1, 2020 3,432,094 $ 3.78 7.8 $ — Granted — — Exercised (771,457) 2.72 $ 2,564 Forfeited — — Expired — — Warrants outstanding, December 31, 2020 2,660,637 $ 4.41 8.9 $ 48,104 Warrants exercisable, December 31, 2020 2,660,637 $ 4.41 8.9 $ 48,104 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
STOCK-BASED COMPENSATION | |
Schedule of activity related to issued and outstanding restricted Class B shares | Number of Restricted Class B Shares Outstanding restricted shares, January 1, 2019 95,558 Cancelled (5,072) Shares vested (90,486) Outstanding restricted shares, December 31, 2019 — Shares vested — Cancelled — Outstanding restricted shares, December 31, 2020 — |
Schedule of assumptions used in estimating the fair value of stock option | Fair Value Assumptions 2020 2019 Risk-free interest rate 0.12% - 0.92% 1.95% and 2.28% Expected term (in years) 5.5 - 6.5 6.5 Expected volatility 60% - 77% 71% and 87% Dividend yield 0% 0% Grant date fair value per share $1.44 - $8.63 $1.39 and $1.56 |
Schedule of company's stock option activity | Weighted- Weighted- Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding Options, January 1, 2019 4,687,440 $ 4.44 8.7 $ — Granted 1,765,529 2.63 Exercised (9,476) 4.35 — Cancelled (1,352,488) 4.27 Outstanding Options, December 31, 2019 5,091,005 $ 3.94 8.5 $ — Exercisable and vested, December 31, 2019 3,555,792 $ 4.27 8.2 $ — Weighted- Weighted- Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Life (Years) Value Outstanding Options, January 1, 2020 5,091,005 $ 3.94 8.5 $ — Granted 1,880,369 5.06 Exercised (185,474) 3.58 3,131 Cancelled (276,309) 2.53 Outstanding Options, December 31, 2020 6,509,591 $ 4.26 6.91 $ 118,657 Exercisable and vested, December 31, 2020 4,750,524 $ 4.22 6.06 $ 86,702 |
Schedule of number of shares that may become exercisable based on share price | Cumulative Number of Share Price Shares $6.6869 - $8.9452 926,795 $8.9453 - $11.9272 1,853,591 $11.9273 - $14.9092 3,243,781 $14.9093 4,633,978 |
Schedule of company's stock-based compensation expense by line item in the consolidated statements of operations | The following table summarizes our stock-based compensation expense by line item for the years ended December 31, 2020 and 2019, in the consolidated statements of operations (in thousands): 2020 2019 Cost of revenues $ 203 $ 218 Selling, general, and administrative 3,364 1,348 Total $ 3,567 $ 1,566 |
Schedule of activity for the warrants issued for services provided | Weighted- Weighted- Average Average Exercise Remaining Aggregate Number of Price Contractual Intrinsic Warrant activity and other data: Warrants per Share Life (Years) Value Warrants outstanding, January 1, 2020 1,083,413 $ 3.94 7.8 $ — Granted — — Exercised (405,702) 2.30 $ 4,553 Forfeited (146,394) 3.58 Expired — — Warrants outstanding, December 31, 2020 531,317 $ 5.37 10.4 $ 9,096 Warrants outstanding exercisable, December 31, 2020 531,317 $ 5.37 10.4 $ 9,096 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INCOME TAXES | |
Schedule of company's provision for income taxes | The provision for income taxes was as follows for the years ended December 31, 2020 and 2019 (in thousands): 2020 2019 Current: Federal $ — $ — State 2 1 Total current 2 1 Total deferred — — Total provision for income taxes $ 2 $ 1 |
Schedule of reconciliation of the federal statutory rate to the effective tax rate | Year Ended December 31, 2020 2019 Federal statutory rate 21.0 % 21.0 % State statutory rate, net of federal tax benefit 31.5 4.4 Federal and state tax credits 15.8 3.6 Stock-based compensation (1.6) (0.2) Valuation allowance adjustments (176.2) (22.9) Purchase money debt reduction (10.7) — Deductible transaction costs 29.1 — Change in fair market value of warrants 94.2 Interest expense on converted debt — (3.9) Loss on extinguishment on converted debt — (1.0) Loss from joint venture — (0.6) Others (3.1) (0.4) Effective tax rate — % — % |
Schedule of principal components of deferred tax assets and liabilities | The following table presents the principal components of deferred tax assets and liabilities as of December 31, 2020 and 2019 (in thousands): Year Ended December 31, 2020 2019 Deferred tax asset: Accrued expense $ 955 $ 1,975 Investment in joint venture 88 — Operating lease liabilities 1,543 — Stock-based compensation 1,239 667 Tax credits 6,771 8,191 Net operating loss carryforwards 49,583 34,419 Total deferred tax asset 60,179 45,252 Deferred tax liability: Property, plant and equipment (386) (465) Operating lease right of use assets (1,507) — Total deferred tax liability (1,893) (465) Net deferred tax asset 58,286 44,787 Valuation allowance (58,286) (44,787) Net deferred tax liability $ — $ — |
Schedule of reconciliation of the total amounts of unrecognized tax benefits | As of December 31 2020 2019 Unrecognized tax benefits – $ — $ — Increase – 1,603 — Increase – 266 — Settlements — — Statute of limitations expiration — — Unrecognized tax benefits – $ 1,869 $ — |
LOSS PER SHARE (Tables)
LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
LOSS PER SHARE | |
Schedule of calculation of basic and diluted net loss per share | The calculation of basic and diluted net loss per share for the years ended December 31, 2020 and 2019 is presented below (in thousands, except share and per share data): 2020 2019 Net loss $ (7,617) $ (59,854) Weighted average common shares outstanding – basic 77,741,339 58,793,480 Dilutive effect of potentially issuable shares — — Weighted average common shares outstanding – diluted 77,741,339 58,793,480 Basic loss per share $ (0.10) $ (1.02) Diluted loss per share $ (0.10) $ (1.02) |
INFORMATION ON BUSINESS SEGME_2
INFORMATION ON BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
INFORMATION ON BUSINESS SEGMENTS | |
Schedule of net sales and gross profit from each of our reportable segments | Net revenues and gross profit from each of our reportable segments are as follows (in thousands): Year Ended December 31, 2020 2019 Net revenues: Romeo Power North America $ 5,832 $ 6,512 Joint Venture Support 3,142 1,976 Total net revenues $ 8,974 $ 8,488 Gross profit (loss): Romeo Power North America $ (9,502) $ (9,068) Joint Venture Support 511 319 Total business segment gross profit (loss) $ (8,991) $ (8,749) |
TRANSACTIONS WITH RELATED PAR_2
TRANSACTIONS WITH RELATED PARTIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stockholder | |
Related Party Transaction [Line Items] | |
Schedule of transactions with related parties | During the year ended December 31, 2019, we allowed two stockholders to exercise outstanding warrants in exchange for notes receivable as presented below (in thousands): Principal Amount Maturity Date Stockholder 1 $ 4,562 July 7, 2022 Stockholder 2 4,561 August 19, 2022 Total $ 9,123 |
Employees | |
Related Party Transaction [Line Items] | |
Schedule of transactions with related parties | Transactions with Employees and Directors December 31, 2020 2019 Convertible notes $ — $ 3,000 Term notes — 100 Total $ — $ 3,100 |
Beneficial owners who own greater than 5% of the Company | |
Related Party Transaction [Line Items] | |
Schedule of transactions with related parties | Short-term and Long-term Debt with Stockholders December 31, 2020 2019 Convertible notes* $ — $ 2,000 Term notes* — 100 Total $ — $ 2,100 * Includes amounts due to our then Chairman and CEO |
DESCRIPTION OF BUSINESS AND B_2
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) | 12 Months Ended | |
Dec. 31, 2020$ / shares | Dec. 31, 2019$ / shares | |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Exchange ratio | 0.121730 | |
BorgWarner Romeo Power LLC | ||
Percentage of right to receive the profit | 40.00% |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash and cash equivalents and accounts receivable net of allowance for doubtful accounts (Details) $ in Thousands | 24 Months Ended |
Dec. 31, 2020USD ($) | |
Cash and Cash Equivalents | |
Accounts guaranteed by FDIC | $ 250 |
Accounts Receivable, Net of Allowance for Doubtful Accounts | |
Allowance for doubtful accounts | $ 240 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of estimated useful lives of property, plant and equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Production and test equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 7 years |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 7 years |
Tooling | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Automobiles | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Computer equipment | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 years |
Software | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Equity Method Investments (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||
Impairment losses of of equity method investments | $ 0 | $ 0 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Impairment of long-lived assets, revenue recognition, research and development, advertising costs, income taxes (Details) - USD ($) | 12 Months Ended | 24 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Impairment of Long-Lived Assets | |||
Impairment losses of long-lived assets | $ 0 | ||
Revenue Recognition | |||
Minimum payment term | 30 days | ||
Maximum payment term | 60 days | ||
Research and Development | |||
Total research and development costs | $ 7,995,000 | $ 11,242,000 | |
Income Taxes | |||
Uncertain tax positions | $ 1,869,000 | $ 0 | $ 1,869,000 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value of Financial Instruments - Liabilities measured at fair value on a recurring basis (Details) - Recurring $ in Thousands | Dec. 31, 2020USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | $ 138,466 |
Public Warrants | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | 71,453 |
Private Placement Warrants | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | 67,013 |
Level 1 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | 71,453 |
Level 1 | Public Warrants | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | 71,453 |
Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | 67,013 |
Level 2 | Private Placement Warrants | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of financial liabilities | $ 67,013 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value of Financial Instruments - Key assumptions use to determine the fair value of private placement warrants (Details) | Dec. 31, 2020 | Dec. 29, 2019 |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 0.17 | 0.17 |
Expected term (in years) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 5 | 5 |
Expected volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 57 | 57 |
Dividend yield | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 0 | 0 |
Fair value of common stock | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 22.49 | 27 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Lease (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
ROU assets-operating leases | $ 5,469 | $ 5,707 | |
Operating lease liabilities | 5,576 | 5,800 | |
Lease liabilities-operating leases (non-current) | $ 4,723 | $ 4,949 | |
Stock options | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Vesting period | 3 years | ||
ASU 2016-02 | Adjustment | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
ROU assets-operating leases | $ 5,920 | ||
Operating lease liabilities | 5,980 | ||
Lease liabilities-operating leases (non-current) | $ 5,150 |
BUSINESS COMBINATION (Details)
BUSINESS COMBINATION (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 05, 2020 | Feb. 12, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Aggregate purchase price | $ 5,027 | $ 56,639 | ||
Number of shares issued in business combination | 82,037,151 | |||
Conversion price | $ 0.4339 | |||
Underwriting fees settled | $ 8,050 | 8,050 | ||
Direct and incremental costs | $ 40,490 | |||
Legal, accounting, and underwriting fees and other costs incurred | 170 | $ 17,802 | ||
Outstanding term notes, including accrued and unpaid interest settled | $ 12,170 | |||
Subscription Agreement | ||||
Business Acquisition [Line Items] | ||||
Number of shares issued (in shares) | 16,000,000 | |||
Purchase price | $ 10 | |||
Aggregate purchase price | $ 160,000 |
BUSINESS COMBINATION - Addition
BUSINESS COMBINATION - Additional Information (Details) - USD ($) $ in Thousands | Oct. 05, 2020 | Feb. 12, 2019 | Dec. 31, 2020 |
BUSINESS COMBINATION | |||
Gross proceeds | $ 394,196 | ||
Less: fees paid to the RMG IPO underwriters | $ 8,050 | 8,050 | |
Less: fees paid to the underwriters | 22,513 | ||
Less: other transaction costs | $ 170 | 17,802 | |
Net cash received from the Business Combination | $ 345,831 |
REVENUES - Changes in contract
REVENUES - Changes in contract liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Changes in contract liabilities | |
Balance at the beginning | $ 289 |
Revenues recognized | (3,167) |
Increase due to billings | 3,693 |
Balance at the end | 815 |
Unsatisfied performance obligations related to minimum quantity purchase commitments | 555,370 |
Minimum | |
Changes in contract liabilities | |
Unsatisfied performance obligations related to minimum quantity purchase commitments | $ 555,370 |
REVENUES - Timing of recongniti
REVENUES - Timing of recongnition of contract liabilities (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | $ 555,370 |
$312 million, Unsatisfied performance obligations | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | 312,000 |
Maximum amount receivable if customers do not follow minimum purchase commitments | 292,760 |
$243.17 million, Unsatisfied performance obligations | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | 243,170 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | $ 23,350 |
Unsatisfied performance obligations, expected to be earned, satisfaction period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | $ 442,740 |
Unsatisfied performance obligations, expected to be earned, satisfaction period | 24 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | |
Unsatisfied performance obligations, expected to be earned | $ 89,280 |
Unsatisfied performance obligations, expected to be earned, satisfaction period | 48 months |
REVENUES - Contract liabilities
REVENUES - Contract liabilities & disaggregation of revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue recognized | $ (3,167) | |
Revenue | 8,974 | $ 8,488 |
Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 5,832 | 6,512 |
Joint Venture support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,142 | 1,976 |
Product revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,910 | 4,847 |
Product revenues | Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,910 | 4,847 |
Modules | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,910 | 4,652 |
Modules | Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,910 | 4,652 |
Packs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 195 | |
Packs | Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 195 | |
Service revenues | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 6,064 | 3,641 |
Service revenues | Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,922 | 1,665 |
Service revenues | Joint Venture support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,142 | 1,976 |
Non-recurring engineering and prototype | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,922 | 1,665 |
Non-recurring engineering and prototype | Romeo Power North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,922 | 1,665 |
Joint Venture support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,142 | 1,976 |
Joint Venture support | Joint Venture support | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 3,142 | $ 1,976 |
REVENUES - Disaggregates revenu
REVENUES - Disaggregates revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Total | $ 8,974 | $ 8,488 |
Point in time | ||
Disaggregation of Revenue [Line Items] | ||
Total | 5,832 | 6,512 |
Over time | ||
Disaggregation of Revenue [Line Items] | ||
Total | $ 3,142 | $ 1,976 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | $ 11,647 | $ 10,748 |
Less accumulated depreciation and amortization | (6,163) | (4,175) |
Total property, plant and equipment-net | 5,484 | 6,573 |
Depreciation and amortization expense | 1,988 | 1,871 |
Production and test equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 6,291 | 5,726 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 847 | 778 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 2,141 | 2,093 |
Tooling | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 912 | 203 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 98 | 97 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 1,076 | 1,076 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | 22 | 22 |
Assets not yet in service | ||
Property, Plant and Equipment [Line Items] | ||
Total property, plant and equipment | $ 260 | $ 753 |
LEASES - Operating finance leas
LEASES - Operating finance leases & lease expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | ||
Option to extend term, Operating lease | 10 years | |
Option to extend term, finance lease | 10 years | |
Option to extend , Operating lease | true | |
Option to extend, finance lease | true | |
Operating lease cost | $ 912 | $ 912 |
Finance lease cost: | ||
Amortization of right-of-use assets | 283 | 62 |
Interest on lease liabilities | 48 | 15 |
Total finance lease cost | $ 331 | $ 77 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term, Operating lease | 1 year | |
Remaining lease term, Finance lease | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term, Operating lease | 11 years | |
Remaining lease term, Finance lease | 12 years |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LEASES | ||
Operating cash flows from operating leases | $ 899 | $ 878 |
Operating cash flows from finance leases | 48 | 15 |
Financing cash flows from finance leases | $ 283 | $ 31 |
LEASES - Supplemental balance s
LEASES - Supplemental balance sheet information (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Operating leases and Finance leases: | ||
ROU assets-operating leases | $ 5,469 | $ 5,707 |
Lease liabilities-operating leases (current) | 853 | 851 |
Lease liabilities-operating leases (non-current) | 4,723 | 4,949 |
Total lease liabilities-operating leases | 5,576 | 5,800 |
Other noncurrent assets | 269 | 551 |
Other current liabilities | 282 | 315 |
Other noncurrent liabilities | 17 | 268 |
Total leases liabilities-finance leases | $ 299 | $ 583 |
Weighted Average Remaining Lease Term, Operating leases | 11 years | 12 years |
Weighted Average Remaining Lease Term, Finance leases | 1 year | 2 years |
Weighted Average Discount Rate, Operating leases | 12.00% | 12.00% |
Weighted Average Discount Rate, Finance leases | 11.20% | 11.20% |
LEASES - Maturities of lease li
LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Operating Leases | ||
2021 | $ 901 | |
2022 | 902 | |
2023 | 902 | |
2024 | 902 | |
2025 | 902 | |
Thereafter | 5,489 | |
Total future minimum lease payments | 9,998 | |
Less imputed interest | (4,422) | |
Total lease liabilities-operating leases | 5,576 | $ 5,800 |
Finance Leases | ||
2021 | 295 | |
2022 | 19 | |
2023 | 0 | |
2024 | 0 | |
Thereafter | 0 | |
Total future minimum lease payments | 314 | |
Less imputed interest | (15) | |
Total leases liabilities-finance leases | $ 299 | $ 583 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
INVENTORY | ||
Raw materials | $ 4,064 | $ 5,535 |
Work-in-process | 531 | 462 |
Finished goods | 342 | 673 |
Total inventories | 4,937 | 6,670 |
Write-down in cost of sales | $ 3,110 | $ 1,740 |
EQUITY METHOD INVESTMENTS - Bor
EQUITY METHOD INVESTMENTS - Borg Warner Romeo Power LLC (Details) - USD ($) | May 06, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Schedule of Equity Method Investments [Line Items] | |||
Amount issued | $ 7,240,000 | $ 72,367,000 | |
Cash contributed at inception | 35,000,000 | ||
Revenue earned for services rendered | 3,142,000 | 1,976,000 | |
Loss on equity method investment | (2,480,000) | (1,520,000) | |
BorgWarner Romeo Power LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Loss on equity method investment | 0 | 1,520,000 | |
Equity method investments | 4,000,000 | ||
BorgWarner Romeo Power LLC | BorgWarner | |||
Schedule of Equity Method Investments [Line Items] | |||
Cash contributed at inception | $ 6,000,000 | ||
Percentage of interest in the Joint Venture | 60.00% | ||
BorgWarner Romeo Power LLC | Legacy Romeo | |||
Schedule of Equity Method Investments [Line Items] | |||
Cash contributed at inception | $ 4,000,000 | ||
Percentage of interest in the Joint Venture | 40.00% | ||
Revenue earned for services rendered | $ 3,140,000 | $ 1,980,000 | |
BorgWarner Romeo Power LLC | Legacy Romeo | BorgWarner | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 10,000,000 | ||
BorgWarner Romeo Power LLC | Series A-1 Preferred Stock | Legacy Romeo | BorgWarner | |||
Schedule of Equity Method Investments [Line Items] | |||
Amount issued | $ 50,000,000 |
EQUITY METHOD INVESTMENTS - Her
EQUITY METHOD INVESTMENTS - Heritage Battery Recycling LLC (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 29, 2020 | Oct. 02, 2020 | |
PIPE Investors | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 25,000 | ||
HBR | |||
Schedule of Equity Method Investments [Line Items] | |||
Percentage of operating shortfall to be funded | 30.00% | ||
Percentage of profit generated by HBR for which the company has right to receive | 30.00% | ||
Percentage of right to receive the profit | 30.00% | ||
Initial contract duration | 10 years | ||
Automatically extended renewal period | 1 year | ||
Amount Agreed To Fund A Pilot | $ 10,000 | ||
Maximum agreed to fund for Pilot | $ 35,000 | ||
HBR | PIPE Investors | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 25,000 | ||
HBR | Legacy Romeo | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investments | $ 35,000 | $ 35,000 |
SHORT-TERM AND LONG-TERM DEBT -
SHORT-TERM AND LONG-TERM DEBT - Components (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Schedule Of Debt Instruments [Line Items] | ||
Paycheck protection program loans | $ 3,342,000 | |
Total short-term and long-term debt | 3,342,000 | $ 10,325,000 |
Less current portion due to related parties | (100,000) | |
Less current portion | (2,260,000) | (5,000,000) |
Total long-term debt | $ 1,082,000 | 5,225,000 |
Minimum | ||
Schedule Of Debt Instruments [Line Items] | ||
Interest rate (as a percent) | 8.00% | |
Maximum | ||
Schedule Of Debt Instruments [Line Items] | ||
Interest rate (as a percent) | 10.00% | |
Convertible notes | ||
Schedule Of Debt Instruments [Line Items] | ||
Total short-term and long-term debt | 5,225,000 | |
Convertible notes issued in 2019, one | ||
Schedule Of Debt Instruments [Line Items] | ||
Subtotal | 4,200,000 | |
Interest rate (as a percent) | 8.00% | |
Valuation cap used to determine the conversion price of debt | 3,680,000 | |
Conversion price (in dollars per share) | $ 0.4339 | |
Convertible notes issued in 2019, two | ||
Schedule Of Debt Instruments [Line Items] | ||
Subtotal | 1,025,000 | |
Interest rate (as a percent) | 8.00% | |
Conversion price (in dollars per share) | $ 0.4339 | |
Term notes | ||
Schedule Of Debt Instruments [Line Items] | ||
Subtotal | $ 0 | 5,100,000 |
Total short-term and long-term debt | 5,100,000 | |
Term notes issued in 2019, one | ||
Schedule Of Debt Instruments [Line Items] | ||
Subtotal | 100,000 | |
Interest rate (as a percent) | 1.55% | |
Term notes issued in 2019, two | ||
Schedule Of Debt Instruments [Line Items] | ||
Subtotal | $ 5,000,000 | |
Interest rate (as a percent) | 8.00% | |
Paycheck protection program loan issued in 2020, One | ||
Schedule Of Debt Instruments [Line Items] | ||
Paycheck protection program loans | $ 3,300,000 | |
Interest rate (as a percent) | 1.00% | |
Period from date of issuance for payment of outstanding principal and interest | 6 months | |
Paycheck protection program loan issued in 2020, Two | ||
Schedule Of Debt Instruments [Line Items] | ||
Paycheck protection program loans | $ 42,000 | |
Interest rate (as a percent) | 1.00% | |
Period from date of issuance for payment of outstanding principal and interest | 16 months |
SHORT-TERM AND LONG-TERM DEBT_2
SHORT-TERM AND LONG-TERM DEBT - Convertible Notes, Term Notes And Line of Credit (Details) - USD ($) | May 06, 2019 | Jun. 30, 2019 | Feb. 28, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Feb. 29, 2020 | May 31, 2019 | May 08, 2019 | Apr. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2017 |
Schedule Of Debt Instruments [Line Items] | |||||||||||
Loss on extinguishment of debt | $ (9,181,000) | ||||||||||
Face amount of debt | 5,320,000 | ||||||||||
Convertible note issuance premium | 5,318,000 | ||||||||||
Term notes issued | $ 6,475,000 | 19,000,000 | |||||||||
Term notes repaid/prepaid | $ 11,575,000 | 25,624,000 | |||||||||
Applicable federal rate (as a percent) | 15.00% | ||||||||||
Issuance of line of credit | 32,000,000 | ||||||||||
Proceeds from PPP loan | $ 3,300,000 | ||||||||||
Minimum | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Interest rate (as a percent) | 8.00% | ||||||||||
Applicable federal rate (as a percent) | 0.09% | ||||||||||
Maximum | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Interest rate (as a percent) | 10.00% | ||||||||||
Applicable federal rate (as a percent) | 1.58% | ||||||||||
Convertible notes | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Term of the notes issued | 6 months | ||||||||||
Convertible notes issued in 2016 | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Amount of debt converted | $ 230,000 | ||||||||||
Amount of accrued interest on debt converted | 8.00% | ||||||||||
Convertible notes issued in 2018, one | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Face amount of debt | $ 8,300,000 | $ 8,300,000 | |||||||||
Convertible notes issued in 2018, one | Valuation cap, one | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Valuation cap | $ 330,000 | ||||||||||
Convertible notes issued in 2018, two | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Face amount of debt | $ 8,710,000 | ||||||||||
Shares issued in exchange for the Series A preferred stock | 18,294,022 | ||||||||||
Convertible notes issued in 2019, one | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Conversion price (in dollars per share) | $ 0.4339 | ||||||||||
Loss on extinguishment of debt | 5,140,000 | ||||||||||
Face amount of debt | 5,230,000 | $ 1,900,000 | |||||||||
Interest rate (as a percent) | 8.00% | ||||||||||
Valuation cap | 3,680,000 | ||||||||||
Interest expense | 1,900,000 | ||||||||||
Outstanding balance | 4,200,000 | ||||||||||
Convertible notes issued in 2019, one | Minimum | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Equity financing proceeds | $ 20,000,000 | ||||||||||
Term notes | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Loss on extinguishment of debt | 360,000 | ||||||||||
Convertible note issuance premium | 25,620,000 | ||||||||||
Accrued interest | 600,000 | ||||||||||
Term notes issued | 6,480,000 | 19,000,000 | |||||||||
Term notes repaid/prepaid | $ 2,000,000 | 12,170,000 | |||||||||
Outstanding balance | 0 | 5,100,000 | |||||||||
Term notes issued in 2018, one | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Face amount of debt | $ 4,400,000 | $ 4,400,000 | |||||||||
Convertible notes converted into Series A Preferred Stock | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Conversion price (in dollars per share) | $ 0.36 | ||||||||||
Accrued interest | $ 3,890,000 | ||||||||||
Outstanding balance | $ 19,200,000 | ||||||||||
UBS Line of Credit | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Interest rate (as a percent) | 3.937% | ||||||||||
Interest expense | $ 420,000 | ||||||||||
Maximum borrowing amount | $ 32,000,000 | $ 32,000,000 | $ 2,700,000 | ||||||||
Paycheck Protection Program ("PPP"), Loan | |||||||||||
Schedule Of Debt Instruments [Line Items] | |||||||||||
Proceeds from PPP loan | $ 3,340,000 |
SHORT-TERM AND LONG-TERM DEBT_3
SHORT-TERM AND LONG-TERM DEBT - Expected maturities associated with the Company's outstanding debt (Details) $ in Thousands | Dec. 31, 2020USD ($) |
SHORT-TERM AND LONG-TERM DEBT | |
2021 | $ 2,259 |
2022 | 1,053 |
2023 | 12 |
2024 | 12 |
2025 | 6 |
Total | $ 3,342 |
SHORT-TERM AND LONG-TERM DEBT_4
SHORT-TERM AND LONG-TERM DEBT - Summary of warrants activity (Details) - Warrants issued in connection with short- term and long-term debt $ / shares in Units, $ in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USN ($)shares | Dec. 31, 2020USD ($)$ / shares | Dec. 31, 2019USD ($)$ / sharesshares | |
Class of Warrant or Right [Line Items] | |||
Value of warrants issued | $ | $ 2,570 | ||
Amortization of the debt discount included in interest expense | $ 0 | $ 3,690 | |
Number of Warrants | |||
Warrants Outstanding, Beginning balance | shares | 3,432,094 | ||
Exercised | shares | (771,457) | ||
Forfeited | shares | 0 | ||
Expired | shares | 0 | ||
Warrants outstanding, Ending balance | shares | 2,660,637 | 3,432,094 | |
Warrants exercisable, Ending balance | shares | 2,660,637 | ||
Weighted Average Exercise Price Per Share | |||
Warrants Outstanding, Beginning balance | $ / shares | $ 3.78 | ||
Exercised | $ / shares | 2.72 | ||
Forfeited | $ / shares | 0 | ||
Expired | $ / shares | 0 | ||
Warrants outstanding, Ending balance | $ / shares | 4.41 | $ 3.78 | |
Warrants exercisable, Ending balance | $ / shares | $ 4.41 | ||
Weighted Average Remaining Contractual Life | |||
Warrants Outstanding, Weighted average remaining contractual life (years) | 8 years 10 months 24 days | 7 years 9 months 18 days | |
Warrants exercisable, Ending balance | 8 years 10 months 24 days | ||
Aggregate Intrinsic Value | |||
Warrants Outstanding, Aggregate intrinsic value | $ | $ 48,104 | $ 0 | |
Warrants Exercised, Aggregate intrinsic value | $ | 2,564 | ||
Warrants Exercisable, Aggregate intrinsic value | $ | $ 48,104 |
PUBLIC AND PRIVATE PLACEMENT _2
PUBLIC AND PRIVATE PLACEMENT WARRANTS (Details) - $ / shares | Feb. 16, 2021 | Feb. 28, 2019 | Dec. 31, 2020 |
Class of Warrant or Right [Line Items] | |||
price per share | $ 9.20 | ||
Threshold period for not transfer of warrants including shares upon exercise of warrants after the business combination | 30 days | ||
Public Warrants | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants issued | 7,666,648 | ||
price per share | $ 11.50 | ||
Redemption price per public warrant (in dollars per share) | $ 0.01 | ||
Minimum threshold written notice period for redemption of public warrants | 30 days | ||
Stock price trigger for redemption of public warrants (in dollars per share) | $ 18 | ||
Threshold trading days for redemption of public warrants | 20 days | ||
Threshold consecutive trading days for redemption of public warrants | 30 days | ||
Warrants redemption, term after warrants become exercisable | 90 days | ||
Private Placement Warrants | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants issued | 4,600,000 | ||
price per share | $ 11.50 | ||
Subsequent event | |||
Class of Warrant or Right [Line Items] | |||
Number of warrants exercised | 442,695 | ||
Number of Warrants Redeemed | 7,223,683 | ||
Cash Outflow for Redemption of Warrants | $ 72,236.83 | ||
Subsequent event | Public Warrants | |||
Class of Warrant or Right [Line Items] | |||
price per share | 11.50 | ||
Redemption price per public warrant (in dollars per share) | $ 0.01 |
PREFERRED STOCK (Details)
PREFERRED STOCK (Details) - Legacy Romeo - USD ($) $ in Thousands | 2 Months Ended | |
May 31, 2020 | Jun. 30, 2019 | |
Series A Preferred Stock [Member] | ||
Temporary Equity [Line Items] | ||
Cash investment | $ 56,490 | |
Amount of converted debt and accrued but unpaid interest | $ 31,850 | |
Series Seed Preferred Stock | ||
Temporary Equity [Line Items] | ||
Percentage on issued and outstanding temporary equity redeemed | 35.45% | |
Redemption of Series Seed Preferred Stock | $ 8,140 | |
Series A-5 Preferred Stock | ||
Temporary Equity [Line Items] | ||
Cash investment | $ 4,000 |
EQUITY - Common and preferred s
EQUITY - Common and preferred stock (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
EQUITY | ||
Number of shares authorized to issue | 260,000,000 | |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Preferred stock shares authorized | 10,000,000 | |
Preferred stock issued (in shares) | 0 | |
Preferred stock outstanding (in shares) | 0 |
STOCK-BASED COMPENSATION - Rest
STOCK-BASED COMPENSATION - Restricted Stock (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2016 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 3,567 | $ 1,566 | |
Class B common stock | Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Stock-based compensation expense | $ 40 |
STOCK-BASED COMPENSATION - Re_2
STOCK-BASED COMPENSATION - Restricted Stock Activity (Details) - Class B common stock - Restricted stock - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Number of Restricted Class B Shares | ||
Outstanding restricted shares, Beginning balance | 0 | 95,558 |
Cancelled | 0 | (5,072) |
Shares vested | 0 | (90,486) |
Outstanding restricted shares, Ending balance | 0 | 0 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock Options (Details) - shares | Dec. 29, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted | 9,630,000 | ||
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Class A common stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted | 1,880,369 | 1,765,529 | |
Class A common stock | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Term of the options | 6 years 6 months | ||
Class A common stock | Stock options | Vesting each month thereafter | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 0.027% | ||
Class A common stock | Incentive stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted | 973,839 | ||
Class A common stock | Nonqualified stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted | 121,730 |
STOCK-BASED COMPENSATION- Assum
STOCK-BASED COMPENSATION- Assumptions used in estimating the fair value of stock options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grant date fair value per share | $ 9.20 | |
Class A common stock | Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Risk-free interest rate, minimum | 0.12% | 1.95% |
Risk-free interest rate, maximum | 0.92% | 2.28% |
Expected term (in years) | 6 years 6 months | |
Expected volatility, minimum | 60.00% | 71.00% |
Expected volatility, maximum | 77.00% | 87.00% |
Dividend yield | 0.00% | 0.00% |
Class A common stock | Stock options | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (in years) | 5 years 6 months | |
Grant date fair value per share | $ 1.44 | $ 1.39 |
Class A common stock | Stock options | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected term (in years) | 6 years 6 months | |
Grant date fair value per share | $ 8.63 | $ 1.56 |
STOCK-BASED COMPENSATION - St_2
STOCK-BASED COMPENSATION - Stock Options Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 29, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Number of Options | ||||
Stock options issued | 9,630,000 | |||
Class A common stock | ||||
Number of Options | ||||
Outstanding Options, Beginning balance | 5,091,005 | 4,687,440 | ||
Stock options issued | 1,880,369 | 1,765,529 | ||
Exercised | (185,474) | (9,476) | ||
Cancelled | (276,309) | (1,352,488) | ||
Outstanding Options, Ending balance | 6,509,591 | 5,091,005 | 4,687,440 | |
Exercisable and vested, Ending balance | 4,750,524 | 3,555,792 | ||
Weighted-Average Exercise Price | ||||
Outstanding Options, Beginning balance | $ 3.94 | $ 4.44 | ||
Granted | 5.06 | 2.63 | ||
Exercised | 3.58 | 4.35 | ||
Cancelled | 2.53 | 4.27 | ||
Outstanding Options, Ending balance | 4.26 | 3.94 | $ 4.44 | |
Exercisable and vested, Ending balance | $ 4.22 | $ 4.27 | ||
Weighted-Average Remaining Contractual Life (Years) | ||||
Outstanding Options, Weighted average remaining contractual life (years) | 6 years 10 months 28 days | 8 years 6 months | 8 years 8 months 12 days | |
Exercisable and vested, Weighted average remaining contractual life (years) | 6 years 21 days | 8 years 2 months 12 days | ||
Aggregate Intrinsic Value | ||||
Exercised, Aggregate intrinsic value | $ 3,131 | $ 0 | ||
Outstanding, Aggregate intrinsic value | 118,657 | 0 | $ 0 | |
Exercisable, Aggregate intrinsic value | $ 86,702 | $ 0 |
STOCK-BASED COMPENSATION - Perf
STOCK-BASED COMPENSATION - Performance and market-based award (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 29, 2020 | Aug. 31, 2020 | Dec. 31, 2020 |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Options granted | 9,630,000 | ||
Performance and market-based award | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Exercise price | $ 15.80 | ||
Cumulative number of shares | 4,633,978 | ||
Aggregate intrinsic value | $ 14,640 | ||
Performance and market-based award | Maximum | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Aggregate intrinsic value | $ 73,220 | ||
$6.6869 - $8.9452 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Cumulative number of shares | 926,795 | ||
$8.9453 - $11.9272 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Cumulative number of shares | 1,853,591 | ||
$11.9273 - $14.9092 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Cumulative number of shares | 3,243,781 | ||
$14.9093 | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Cumulative number of shares | 4,633,978 | ||
Chairman and CEO | |||
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |||
Stock options, awarded | 4,633,978 | ||
Exercise price | $ 6.69 |
STOCK-BASED COMPENSATION - St_3
STOCK-BASED COMPENSATION - Stock- based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | $ 3,567 | $ 1,566 |
Cost of sales | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | 203 | 218 |
Selling, general, and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | 3,364 | $ 1,348 |
Performance and market-based award | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Unrecorded compensation expense | $ 9,470 | |
Exercisable and vested, Ending balance | 4,633,978 | |
Class A common stock | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Unrecorded compensation expense | $ 6,440 | |
Exercisable and vested, Ending balance | 4,750,524 | 3,555,792 |
Class A common stock | Stock options | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation expense | $ 3,570 | |
Number of unvested shares | 1,759,067 |
STOCK-BASED COMPENSATION - Warr
STOCK-BASED COMPENSATION - Warrants (Details) | 12 Months Ended | ||
Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2020USN ($)shares | Dec. 31, 2019USD ($)$ / sharesshares | |
Aggregate Intrinsic Value | |||
Maximum number of shares may issue pursuant to stock awards | 15,000,000 | ||
Number of shares subject to outstanding pursuant to issue of stock awards | $ | $ 11,290,900 | ||
Warrants issued for services provided | |||
Class of Warrant or Right [Line Items] | |||
Amount of expense for warrants | $ | $ 0 | $ 0 | |
Number of Warrants | |||
Warrants Outstanding, Beginning balance | 1,083,413 | 1,083,413 | |
Exercised | (405,702) | (405,702) | |
Forfeited | (146,394) | (146,394) | |
Warrants outstanding, Ending balance | 531,317 | 531,317 | 1,083,413 |
Warrants exercisable, Ending balance | 531,317 | 531,317 | |
Weighted Average Exercise Price Per Share | |||
Warrants Outstanding, Beginning balance | $ / shares | $ 3.94 | ||
Exercised | $ / shares | 2.30 | ||
Forfeited | $ / shares | 3.58 | ||
Warrants outstanding, Ending balance | $ / shares | 5.37 | $ 3.94 | |
Warrants exercisable, Ending balance | $ / shares | $ 5.37 | ||
Weighted Average Remaining Contractual Life | |||
Warrants Outstanding, Weighted average remaining contractual life (years) | 7 years 9 months 18 days | 7 years 9 months 18 days | 8 years 9 months 18 days |
Warrants exercisable, Ending balance | 7 years 9 months 18 days | 7 years 9 months 18 days | |
Aggregate Intrinsic Value | |||
Warrants Outstanding, Aggregate intrinsic value | $ | $ 9,096,000 | $ 0 | |
Warrants Exercised, Aggregate intrinsic value | $ | 4,553,000 | ||
Warrants Exercisable, Aggregate intrinsic value | $ | $ 9,096,000 |
INCOME TAXES - Provision for in
INCOME TAXES - Provision for income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | ||
State | $ 2 | $ 1 |
Total current | 2 | 1 |
Total provision for income taxes | $ 2 | $ 1 |
INCOME TAXES - Effective tax ra
INCOME TAXES - Effective tax rate reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
INCOME TAXES | ||
Federal statutory rate | 21.00% | 21.00% |
State statutory rate, net of federal tax benefit | 31.50% | 4.40% |
Tax credits | 15.80% | 3.60% |
Stock-based compensation | (1.60%) | (0.20%) |
Valuation allowance adjustments | (176.20%) | (22.90%) |
Purchase money debt reduction | (10.70%) | |
Deductible transaction costs | 29.10% | |
Change in fair market value of warrants | 94.20% | |
Interest expense on converted debt | (3.90%) | |
Loss on extinguishment on converted debt | (1.00%) | |
Loss from joint venture | (0.60%) | |
Others | (3.10%) | (0.40%) |
Effective tax rate | 0.00% | 0.00% |
INCOME TAXES - Principal compon
INCOME TAXES - Principal components of deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax asset: | ||
Accrued expense | $ 955 | $ 1,975 |
Investment in joint venture | 88 | |
Operating lease liabilities | 1,543 | |
Stock-based compensation | 1,239 | 667 |
Tax credits | 6,771 | 8,191 |
Net operating loss carryforwards | 49,583 | 34,419 |
Total deferred tax asset | 60,179 | 45,252 |
Deferred tax liability: | ||
Property, plant and equipment | (386) | (465) |
Operating lease right of use assets | (1,507) | |
Total deferred tax liability | (1,893) | (465) |
Net deferred tax asset | 58,286 | 44,787 |
Valuation allowance | $ (58,286) | $ (44,787) |
INCOME TAXES - Additional infor
INCOME TAXES - Additional information (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
INCOME TAXES | ||
Valuation allowance | $ 58,286 | $ 44,787 |
INCOME TAXES - Unrecognized tax
INCOME TAXES - Unrecognized tax benefits (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Reconciliation of the total amounts of unrecognized tax benefits | |
Unrecognized tax benefits , Beginning | $ 0 |
Increase - prior year | 1,603 |
Increase - current year | 266 |
Unrecognized tax benefits, Ending | $ 1,869 |
LOSS PER SHARE - (Details)
LOSS PER SHARE - (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
LOSS PER SHARE | ||
Net loss | $ (7,617) | $ (59,854) |
Weighted average common shares outstanding - basic | 77,741,339 | 58,793,480 |
Weighted Average Number of Shares Outstanding, Diluted | 77,741,339 | 58,793,480 |
Basic loss per share | $ (0.10) | $ (1.02) |
Diluted loss per share | $ (0.10) | $ (1.02) |
Antidilutive shares | 26,602,189 | 21,873,178 |
INFORMATION ON BUSINESS SEGME_3
INFORMATION ON BUSINESS SEGMENTS (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($)segmentindividual | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 2 | |
Number of individuals | individual | 2 | |
Total net revenues | $ 8,974 | $ 8,488 |
Total business segment gross profit (loss) | (8,991) | (8,749) |
Romeo Power North America | ||
Segment Reporting Information [Line Items] | ||
Total net revenues | 5,832 | 6,512 |
Total business segment gross profit (loss) | (9,502) | (9,068) |
Joint Venture support | ||
Segment Reporting Information [Line Items] | ||
Total net revenues | 3,142 | 1,976 |
Total business segment gross profit (loss) | $ 511 | $ 319 |
TRANSACTIONS WITH RELATED PAR_3
TRANSACTIONS WITH RELATED PARTIES - Notes Receivable from Stockholders (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)item | Apr. 30, 2020USD ($) | Dec. 31, 2016USD ($) | |
Related Party Transaction [Line Items] | |||||
Proceeds from stockholder note receivable | $ 5,307 | ||||
Stockholder | |||||
Related Party Transaction [Line Items] | |||||
Outstanding notes receivable | $ 0 | $ 0 | $ 50 | ||
Wrote-off the outstanding balance from related party | 50 | ||||
Number of stockholders who exercised outstanding Warrants in exchange for notes receivable | item | 2 | ||||
Principal Amount of notes receivable | $ 9,123 | $ 9,120 | |||
Interest rate (as a percent) | 2.00% | ||||
Proceeds from stockholder note receivable | $ 5,310 | ||||
Amount of notes receivable agreed to cancel | $ 2,020 | $ 2,020 | $ 1,790 | ||
Stockholder 1 | |||||
Related Party Transaction [Line Items] | |||||
Principal Amount of notes receivable | 4,562 | ||||
Stockholder 2 | |||||
Related Party Transaction [Line Items] | |||||
Principal Amount of notes receivable | $ 4,561 |
TRANSACTIONS WITH RELATED PAR_4
TRANSACTIONS WITH RELATED PARTIES - Transactions with Employees (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
May 31, 2019 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Notes issued | $ 5,320 | ||||
Employees | |||||
Related Party Transaction [Line Items] | |||||
Notes payable | 3,100 | ||||
Employees | Convertible notes | |||||
Related Party Transaction [Line Items] | |||||
Notes payable | 3,000 | ||||
Employees | Term notes | |||||
Related Party Transaction [Line Items] | |||||
Notes payable | 100 | ||||
CEO and CFO | Series A-2 preferred stock | |||||
Related Party Transaction [Line Items] | |||||
Notes payable | $ 6,780 | ||||
CEO and CFO | Convertible notes | |||||
Related Party Transaction [Line Items] | |||||
Amount of debt converted | $ 1,510 | ||||
CEO | |||||
Related Party Transaction [Line Items] | |||||
Amount borrowed | $ 5,240 | ||||
Amount repaid | $ 10,860 | ||||
CEO | Term notes | |||||
Related Party Transaction [Line Items] | |||||
Notes issued | $ 750 | ||||
Term of the notes issued | 1 year | ||||
Chairman | Term notes | |||||
Related Party Transaction [Line Items] | |||||
Notes issued | $ 330 | $ 330 | |||
Term of the notes issued | 1 year |
TRANSACTIONS WITH RELATED PAR_5
TRANSACTIONS WITH RELATED PARTIES - Short-term and Long-term Debt with Stockholders (Details) - Beneficial owners who own greater than 5% of the Company - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | ||
Notes payable | $ 2,100 | |
Ownership interest in company (as a percent) | 5.00% | |
Convertible notes | ||
Related Party Transaction [Line Items] | ||
Notes payable | 2,000 | |
Convertible notes | Current maturities of long-term debt to related parties | ||
Related Party Transaction [Line Items] | ||
Notes payable | 100 | |
Term notes | ||
Related Party Transaction [Line Items] | ||
Notes payable | 100 | |
Term notes | Long-term debt - net of current potion | ||
Related Party Transaction [Line Items] | ||
Notes payable | $ 2,000 |
TRANSACTIONS WITH RELATED PAR_6
TRANSACTIONS WITH RELATED PARTIES - Transactions with BorgWarner and the Joint Venture (Details) - USD ($) $ in Thousands | Oct. 02, 2020 | May 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 29, 2020 |
Related Party Transaction [Line Items] | |||||
Revenue earned for services rendered | $ 3,142 | $ 1,976 | |||
Maximum agreed fund to purchase ten battery electric vehicle ("BEV") trucks and the charging infrastructure | $ 10,000 | ||||
Minimum procurement of BEVs, if the pilot program is successful | 1 year | ||||
PIPE Investors | |||||
Related Party Transaction [Line Items] | |||||
Equity method investments | $ 25,000 | ||||
HBR | PIPE Investors | |||||
Related Party Transaction [Line Items] | |||||
Equity method investments | $ 25,000 | ||||
HBR | Legacy Romeo | |||||
Related Party Transaction [Line Items] | |||||
Equity method investments | $ 35,000 | $ 35,000 | |||
BorgWarner | |||||
Related Party Transaction [Line Items] | |||||
Ownership interest in company on an as converted, fully diluted basis (as a percent) | 20.00% | 15.20% | |||
BorgWarner | Series A-1 Preferred Stock | |||||
Related Party Transaction [Line Items] | |||||
Proceeds from issuance of preferred stock | $ 50,000 | ||||
BorgWarner Romeo Power LLC | |||||
Related Party Transaction [Line Items] | |||||
Revenue earned for services rendered | $ 1,980 | $ 3,140 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |||
Legal settlement expense | $ 4,586 | ||
Settlement Agreed amount | $ 6,000 | ||
Legal settlement payable | 6,000 | $ 6,000 | |
Insurance receivable | $ 6,000 | $ 6,000 |
MAJOR CUSTOMERS AND ACCOUNTS _2
MAJOR CUSTOMERS AND ACCOUNTS RECEIVABLE (Details) - item | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts receivable | ||
Concentration Risk [Line Items] | ||
Number of Customers | 4 | |
Revenue | ||
Concentration Risk [Line Items] | ||
Number of Customers | 2 | 2 |
Concentration Risk, Percentage | 55.00% | 74.00% |
Revenue | Customer one | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 28.00% | 59.00% |
Revenue | Customer two | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 27.00% | |
Revenue | Minimum | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 10.00% | |
Joint venture engineering services | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 35.00% | 23.00% |
Joint venture engineering services | Accounts receivable | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 44.00% | |
Joint venture engineering services | Customer two | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 15.00% | |
Accounts receivable | ||
Concentration Risk [Line Items] | ||
Number of Customers | 2 | 4 |
Concentration Risk, Percentage | 26.00% | 98.00% |
Accounts receivable | Customer one | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 13.00% | 34.00% |
Accounts receivable | Customer two | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 13.00% | 22.00% |
Accounts receivable | Customer three | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 21.00% | |
Accounts receivable | Customer four | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 21.00% | |
Accounts receivable | Minimum | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 10.00% |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 06, 2021 | Feb. 16, 2021 | Jan. 21, 2021 | Dec. 31, 2019 |
Subsequent Event [Line Items] | ||||
Investment in Joint Venture | $ 4,000 | |||
Subsequent event | ||||
Subsequent Event [Line Items] | ||||
Investment in Joint Venture | $ 4,000 | |||
Warrant exercise price | $ 11.50 | |||
Redemption Price | $ 0.01 | |||
Number of warrants exercised | 442,695 | |||
Number of warrants cancelled | 7,223,683 | |||
Payment for redemption of warrants | $ 72,236.83 | |||
Subsequent event | Long-term supply agreement with Paccar, Inc. | ||||
Subsequent Event [Line Items] | ||||
Number of shares issued (in shares) | 650,000 |