mnts-20210930
000178116212/312021Q3falsehttp://fasb.org/us-gaap/2021-01-31#ServiceMemberhttp://fasb.org/us-gaap/2021-01-31#ServiceMemberhttp://fasb.org/us-gaap/2021-01-31#ServiceMemberhttp://fasb.org/us-gaap/2021-01-31#ServiceMemberhttp://fasb.org/us-gaap/2021-01-31#AccountingStandardsUpdate201602MemberP1Y00017811622021-01-012021-09-300001781162us-gaap:CommonClassAMember2021-01-012021-09-300001781162us-gaap:WarrantMember2021-01-012021-09-30xbrli:shares00017811622021-09-30iso4217:USD00017811622020-12-31iso4217:USDxbrli:shares00017811622021-07-012021-09-3000017811622020-07-012020-09-3000017811622020-01-012020-09-300001781162srt:ScenarioPreviouslyReportedMemberus-gaap:PreferredStockMember2020-12-310001781162srt:ScenarioPreviouslyReportedMembermnts:FFPreferredStockMember2020-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassAMember2020-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassBMember2020-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonStockMember2020-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:AdditionalPaidInCapitalMember2020-12-310001781162us-gaap:RetainedEarningsMembersrt:ScenarioPreviouslyReportedMember2020-12-310001781162srt:ScenarioPreviouslyReportedMember2020-12-310001781162srt:RestatementAdjustmentMemberus-gaap:PreferredStockMember2020-12-310001781162srt:RestatementAdjustmentMembermnts:FFPreferredStockMember2020-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonClassAMember2020-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonClassBMember2020-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonStockMember2020-12-310001781162srt:RestatementAdjustmentMemberus-gaap:AdditionalPaidInCapitalMember2020-12-310001781162us-gaap:PreferredStockMember2020-12-310001781162mnts:FFPreferredStockMember2020-12-310001781162us-gaap:CommonClassAMember2020-12-310001781162us-gaap:CommonClassBMember2020-12-310001781162us-gaap:CommonStockMember2020-12-310001781162us-gaap:AdditionalPaidInCapitalMember2020-12-310001781162us-gaap:RetainedEarningsMember2020-12-310001781162us-gaap:CommonStockMember2021-01-012021-03-310001781162us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-3100017811622021-01-012021-03-310001781162us-gaap:RetainedEarningsMember2021-01-012021-03-310001781162us-gaap:CommonStockMember2021-03-310001781162us-gaap:AdditionalPaidInCapitalMember2021-03-310001781162us-gaap:RetainedEarningsMember2021-03-3100017811622021-03-310001781162us-gaap:CommonStockMember2021-04-012021-06-300001781162us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-3000017811622021-04-012021-06-300001781162us-gaap:RetainedEarningsMember2021-04-012021-06-300001781162us-gaap:CommonStockMember2021-06-300001781162us-gaap:AdditionalPaidInCapitalMember2021-06-300001781162us-gaap:RetainedEarningsMember2021-06-3000017811622021-06-300001781162us-gaap:CommonStockMember2021-07-012021-09-300001781162us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300001781162us-gaap:RetainedEarningsMember2021-07-012021-09-300001781162us-gaap:CommonStockMember2021-09-300001781162us-gaap:AdditionalPaidInCapitalMember2021-09-300001781162us-gaap:RetainedEarningsMember2021-09-300001781162srt:ScenarioPreviouslyReportedMemberus-gaap:PreferredStockMember2019-12-310001781162srt:ScenarioPreviouslyReportedMembermnts:FFPreferredStockMember2019-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassAMember2019-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonClassBMember2019-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:CommonStockMember2019-12-310001781162srt:ScenarioPreviouslyReportedMemberus-gaap:AdditionalPaidInCapitalMember2019-12-310001781162us-gaap:RetainedEarningsMembersrt:ScenarioPreviouslyReportedMember2019-12-310001781162srt:ScenarioPreviouslyReportedMember2019-12-310001781162srt:RestatementAdjustmentMemberus-gaap:PreferredStockMember2019-12-310001781162srt:RestatementAdjustmentMembermnts:FFPreferredStockMember2019-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonClassAMember2019-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonClassBMember2019-12-310001781162srt:RestatementAdjustmentMemberus-gaap:CommonStockMember2019-12-310001781162srt:RestatementAdjustmentMemberus-gaap:AdditionalPaidInCapitalMember2019-12-310001781162us-gaap:PreferredStockMember2019-12-310001781162mnts:FFPreferredStockMember2019-12-310001781162us-gaap:CommonClassAMember2019-12-310001781162us-gaap:CommonClassBMember2019-12-310001781162us-gaap:CommonStockMember2019-12-310001781162us-gaap:AdditionalPaidInCapitalMember2019-12-310001781162us-gaap:RetainedEarningsMember2019-12-3100017811622019-12-310001781162us-gaap:CommonStockMember2020-01-012020-03-310001781162us-gaap:AdditionalPaidInCapitalMember2020-01-012020-03-3100017811622020-01-012020-03-3100017811622019-01-012019-12-310001781162us-gaap:RetainedEarningsMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001781162srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2019-12-310001781162us-gaap:RetainedEarningsMember2020-01-012020-03-310001781162us-gaap:CommonStockMember2020-03-310001781162us-gaap:AdditionalPaidInCapitalMember2020-03-310001781162us-gaap:RetainedEarningsMember2020-03-3100017811622020-03-310001781162us-gaap:CommonStockMember2020-04-012020-06-300001781162us-gaap:AdditionalPaidInCapitalMember2020-04-012020-06-3000017811622020-04-012020-06-300001781162us-gaap:RetainedEarningsMember2020-04-012020-06-300001781162us-gaap:CommonStockMember2020-06-300001781162us-gaap:AdditionalPaidInCapitalMember2020-06-300001781162us-gaap:RetainedEarningsMember2020-06-3000017811622020-06-300001781162us-gaap:CommonStockMember2020-07-012020-09-300001781162us-gaap:AdditionalPaidInCapitalMember2020-07-012020-09-300001781162us-gaap:RetainedEarningsMember2020-07-012020-09-300001781162us-gaap:CommonStockMember2020-09-300001781162us-gaap:AdditionalPaidInCapitalMember2020-09-300001781162us-gaap:RetainedEarningsMember2020-09-3000017811622020-09-300001781162us-gaap:CommonClassBMember2021-08-12xbrli:pure0001781162us-gaap:CommonClassAMember2021-08-1200017811622021-07-152021-07-1500017811622021-07-150001781162mnts:PrivateWarrantMember2021-07-1500017811622021-08-122021-08-120001781162mnts:CashDesignatedForCollateralMember2021-09-300001781162mnts:CashDesignatedForExpendituresUnderNationalSecurityAgreementMember2021-09-3000017811622020-01-012020-12-31mnts:agreement00017811622021-05-212021-05-210001781162mnts:ShareBasedPaymentArrangementOptionsUnderStockIncentivePlanMember2021-07-012021-09-300001781162mnts:ShareBasedPaymentArrangementOptionsUnderStockIncentivePlanMember2021-01-012021-09-300001781162mnts:ShareBasedPaymentArrangementOptionsUnderStockIncentivePlanMember2020-01-012020-09-300001781162mnts:ShareBasedPaymentArrangementOptionsUnderStockIncentivePlanMember2020-07-012020-09-300001781162mnts:ShareBasedPaymentArrangementOptionsOutsideStockIncentivePlanMember2021-07-012021-09-300001781162mnts:ShareBasedPaymentArrangementOptionsOutsideStockIncentivePlanMember2021-01-012021-09-300001781162mnts:ShareBasedPaymentArrangementOptionsOutsideStockIncentivePlanMember2020-01-012020-09-300001781162mnts:ShareBasedPaymentArrangementOptionsOutsideStockIncentivePlanMember2020-07-012020-09-300001781162us-gaap:WarrantMember2021-07-012021-09-300001781162us-gaap:WarrantMember2021-01-012021-09-300001781162us-gaap:WarrantMember2020-07-012020-09-300001781162us-gaap:WarrantMember2020-01-012020-09-300001781162mnts:SimpleAgreementForFutureEquityNotesOutstandingUnreservedStockMember2021-07-012021-09-300001781162mnts:SimpleAgreementForFutureEquityNotesOutstandingUnreservedStockMember2021-01-012021-09-300001781162mnts:SimpleAgreementForFutureEquityNotesOutstandingUnreservedStockMember2020-07-012020-09-300001781162mnts:SimpleAgreementForFutureEquityNotesOutstandingUnreservedStockMember2020-01-012020-09-3000017811622020-01-0100017811622021-08-120001781162us-gaap:CommonClassAMember2021-09-30mnts:tradingDay0001781162us-gaap:ComputerEquipmentMember2021-09-300001781162us-gaap:ComputerEquipmentMember2020-12-310001781162us-gaap:FurnitureAndFixturesMember2021-09-300001781162us-gaap:FurnitureAndFixturesMember2020-12-310001781162us-gaap:LeaseholdImprovementsMember2021-09-300001781162us-gaap:LeaseholdImprovementsMember2020-12-310001781162us-gaap:MachineryAndEquipmentMember2021-09-300001781162us-gaap:MachineryAndEquipmentMember2020-12-310001781162us-gaap:ConstructionInProgressMember2021-09-300001781162us-gaap:ConstructionInProgressMember2020-12-310001781162us-gaap:IntellectualPropertyMember2021-09-300001781162us-gaap:IntellectualPropertyMember2021-01-012021-09-300001781162us-gaap:IntellectualPropertyMember2020-12-310001781162us-gaap:IntellectualPropertyMember2020-01-012020-12-3100017811622021-01-310001781162us-gaap:CommonClassAMember2021-08-122021-08-120001781162mnts:TermLoanMember2021-02-220001781162mnts:TermLoanMember2021-03-012021-03-010001781162srt:MinimumMembermnts:TermLoanMember2021-02-222021-02-220001781162srt:MaximumMembermnts:TermLoanMember2021-02-222021-02-220001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-02-220001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-09-300001781162mnts:TermLoanMember2021-07-012021-09-300001781162mnts:TermLoanMember2021-01-012021-09-300001781162mnts:TermLoanMember2021-02-222021-02-220001781162mnts:EquipmentLoanMember2020-03-310001781162mnts:EquipmentLoanMember2020-03-012020-03-310001781162mnts:EquipmentLoanMember2020-03-092020-03-090001781162mnts:EquipmentLoanMember2020-03-090001781162mnts:EquipmentLoanMember2020-03-012020-09-010001781162mnts:EquipmentLoanMembermnts:PreferredStockPurchaseWarrantsMember2020-03-092020-03-090001781162mnts:EquityAndConvertibleDebtStockPurchaseWarrantsMembermnts:EquipmentLoanMember2020-03-092020-03-090001781162mnts:StockPurchaseWarrantsMembermnts:EquipmentLoanMember2020-03-090001781162mnts:EquipmentLoanMember2021-07-012021-09-300001781162mnts:EquipmentLoanMember2021-01-012021-09-300001781162mnts:EquipmentLoanMember2020-12-012020-12-310001781162mnts:TermLoanMember2021-09-300001781162mnts:SecondLienPromissoryNotesMember2021-09-3000017811622021-08-130001781162us-gaap:CommonClassAMember2021-08-130001781162us-gaap:PreferredStockMember2021-08-1300017811622021-08-132021-08-130001781162mnts:MomentusSpaceLLCUnitHoldersMember2021-08-130001781162mnts:MomentusSpaceLLCUnitHoldersMember2021-08-132021-08-130001781162mnts:PublicStockholdersMember2021-08-130001781162mnts:PublicStockholdersMember2021-08-132021-08-130001781162mnts:StableRoadAcquisitionCorporationAndAffiliatesMember2021-08-130001781162mnts:StableRoadAcquisitionCorporationAndAffiliatesMember2021-08-132021-08-130001781162mnts:PrivateInvestmentInPublicEquityInvestorsMember2021-08-130001781162mnts:PrivateInvestmentInPublicEquityInvestorsMember2021-08-132021-08-130001781162mnts:CoFounderDivestmentAndShareRepurchaseAgreementsMember2021-06-302021-06-300001781162mnts:TermLoanMember2021-02-280001781162mnts:TermLoanMember2021-02-012021-02-280001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-02-280001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-06-300001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-07-012021-09-300001781162mnts:StockPurchaseWarrantsMembermnts:TermLoanMember2021-01-012021-09-300001781162mnts:StockPurchaseWarrantsMembermnts:EquipmentLoanMember2020-03-012020-03-310001781162mnts:StockPurchaseWarrantsMembermnts:EquipmentLoanMember2021-07-012021-09-300001781162mnts:StockPurchaseWarrantsMembermnts:EquipmentLoanMember2021-01-012021-09-300001781162mnts:PublicWarrantMember2021-09-300001781162mnts:PrivatePlacementWarrantMember2021-09-300001781162mnts:OtherWarrantsMember2021-09-300001781162mnts:PrivatePlacementWarrantMember2021-07-012021-09-300001781162mnts:PrivatePlacementWarrantMember2021-01-012021-09-300001781162mnts:A2021EquityIncentivePlanMember2021-08-120001781162mnts:A2021EquityIncentivePlanMember2021-08-122021-08-120001781162mnts:A2021EmployeeStockPurchasePlanMember2021-08-120001781162mnts:A2021EmployeeStockPurchasePlanMember2021-08-122021-08-120001781162us-gaap:ResearchAndDevelopmentExpenseMember2021-07-012021-09-300001781162us-gaap:ResearchAndDevelopmentExpenseMember2020-07-012020-09-300001781162us-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-09-300001781162us-gaap:ResearchAndDevelopmentExpenseMember2020-01-012020-09-300001781162us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-07-012021-09-300001781162us-gaap:SellingGeneralAndAdministrativeExpensesMember2020-07-012020-09-300001781162us-gaap:SellingGeneralAndAdministrativeExpensesMember2021-01-012021-09-300001781162us-gaap:SellingGeneralAndAdministrativeExpensesMember2020-01-012020-09-300001781162us-gaap:EmployeeStockOptionMember2021-09-300001781162us-gaap:EmployeeStockOptionMember2021-01-012021-09-300001781162srt:MinimumMemberus-gaap:EmployeeStockOptionMember2020-01-012020-09-300001781162srt:MaximumMemberus-gaap:EmployeeStockOptionMember2020-01-012020-09-300001781162us-gaap:EmployeeStockOptionMember2020-01-012020-09-300001781162mnts:August312021StockOptionModificationsMemberus-gaap:EmployeeStockOptionMember2021-08-312021-08-310001781162mnts:August312021StockOptionModificationsMemberus-gaap:EmployeeStockOptionMember2021-08-310001781162mnts:May222021StockOptionModificationsMemberus-gaap:EmployeeStockOptionMember2021-05-222021-05-220001781162mnts:May222021StockOptionModificationsMemberus-gaap:EmployeeStockOptionMember2021-05-220001781162us-gaap:EmployeeStockOptionMembermnts:January252021StockOptionModificationMember2021-01-252021-01-250001781162srt:MinimumMemberus-gaap:EmployeeStockOptionMembermnts:January252021StockOptionModificationMember2021-01-250001781162srt:MaximumMemberus-gaap:EmployeeStockOptionMembermnts:January252021StockOptionModificationMember2021-01-250001781162us-gaap:EmployeeStockOptionMembermnts:January252021StockOptionModificationMember2021-01-250001781162mnts:SECInvestigationMember2021-07-082021-07-080001781162mnts:SECInvestigationMember2021-07-080001781162mnts:NationalSecurityAgreementMember2021-02-012021-02-280001781162mnts:SECInvestigationMember2021-07-012021-09-300001781162mnts:SECInvestigationMember2021-01-012021-09-300001781162mnts:ConsultingAndTechnologyDevelopmentAgreementMembersrt:AffiliatedEntityMember2020-07-012020-09-300001781162mnts:ConsultingAndTechnologyDevelopmentAgreementMembersrt:AffiliatedEntityMember2020-01-012020-09-300001781162mnts:ConsultingAndTechnologyDevelopmentAgreementMembersrt:AffiliatedEntityMember2021-01-012021-09-300001781162mnts:ConsultingAndTechnologyDevelopmentAgreementMembersrt:AffiliatedEntityMember2021-07-012021-09-300001781162mnts:BrainyspaceLLCMembersrt:AffiliatedEntityMembermnts:ShareContributionAgreementMemberus-gaap:CommonClassBMember2020-03-012020-03-310001781162srt:AffiliatedEntityMembermnts:ShareContributionAgreementMemberus-gaap:CommonClassBMember2020-03-012020-03-310001781162us-gaap:SubsequentEventMember2021-10-192021-10-19
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2021
OR
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from   to
Commission file number 001-39128
Momentus Inc.
(Exact name of registrant as specified in its charter)
Delaware84-1905538
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
3901 N. First Street
San Jose, California
95134
(Address of Principal Executive Offices)(Zip Code)
(650) 564-7820
Registrant's telephone number, including area code
Stable Road Acquisition Corp.
1345 Abbot Kinney Blvd. Venice, California
202090291
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to section 12(g) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stockMNTS
The Nasdaq Capital Market LLC
WarrantsMNTSW
The Nasdaq Capital Market LLC
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  x    No  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
1

Table of Contents
Large accelerated fileroAccelerated filero
Non-accelerated filerxSmaller reporting companyx
Emerging growth companyx
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o   No  x
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
o Yes x No
APPLICABLE ONLY TO CORPORATE ISSUERS:
The registrant had outstanding 80,580,232 shares of common stock as of September 30, 2021.
2

Tables of Contents
TABLE OF CONTENTS
Page
Condensed Consolidated Balance Sheets
Condensed Consolidated Statements of Operations
Condensed Consolidated Statements of Shareholders’ Equity (Deficit)
Condensed Consolidated Statements of Cash Flows
Notes to the Condensed Consolidated Financial Statements
Item 3. Quantitative and Qualitative Disclosures About Market Risk
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q (this "Form 10-Q), including, without limitation, statements under the headings "Management's Discussion and Analysis of Financial Condition and Results of Operations," includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended, (the "Exchange Act"). Generally, statements that are not historical facts, including statements concerning Momentus Inc.’s (the “Company,” “we,” “us,” or “our”) possible or assumed future actions, business strategies, events, or results of operations, are forward-looking statements. These forward-looking statements can be identified by the use of forward-looking terminology, including the words "believes," "estimates," "anticipates," "expects," "intends," "plans," "may," "will," "potential," "projects," "predicts," "continue," or "should," or, in each case, their negative or other variations or comparable terminology, but the absence of these words does not mean that a statement is not forward-looking. There can be no assurance that actual results will not materially differ from expectations.
The forward-looking statements contained in this Form 10-Q are based on our current expectations and beliefs concerning future developments and their potential effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, without limitation, the ability of the Company to obtain licenses and government approvals for its missions, which are essential to its operations; the ability of the Company to effectively market and sell satellite transport services and planned in-orbit services; the ability of the Company to protect its intellectual property and trade secrets; the development of markets for satellite transport and in-orbit services; the ability of the Company to develop, test and validate its technology, including its water plasma propulsion technology; delays or impediments that the Company may face in the development, manufacture and deployment of next generation satellite transport
3

Tables of Contents
systems; the ability of the Company to convert backlog or inbound inquiries into revenue; changes in applicable laws or regulations and extensive and evolving government regulations that impact operations and business, including export control license requirements; the ability to attract or maintain a qualified workforce with the required security clearances and requisite skills; level of product service or product or launch failures or delays that could lead customers to use competitors’ services; investigations, claims, disputes, enforcement actions, litigation and/or other regulatory or legal proceedings; the effects of the COVID-19 pandemic on the Company’s business; the Company’s ability to comply with the terms of its National Security Agreement and any related compliance measures instituted by the director who was approved by the CFIUS Monitoring Agencies (the “Security Director”); the possibility that the Company may be adversely affected by other economic, business, and/or competitive factors; and/or other risks and uncertainties described under Part II, Item 1A: "Risk Factors." Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws. These risks and others described under Part II, Item 1A: "Risk Factors" may not be exhaustive.
By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements contained in this Form 10-Q. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. In addition, even if our results or operations, financial condition and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in this Form 10-Q, those results or developments may not be indicative of results or developments in subsequent periods.
4

Tables of Contents


MOMENTUS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30,
2021
December 31,
2020
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents$178,059 $23,005 
Restricted cash, current820 100 
Prepaids and other current assets10,408 4,508 
Total current assets189,287 27,613 
Property, machinery and equipment, net4,786 2,321 
Intangible assets, net344 305 
Operating right of use asset7,846 316 
Deferred offering costs 2,610 
Restricted cash, non-current313 415 
Other non-current assets3,065 2,740 
Total assets$205,640 $36,320 
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Accounts payable$4,755 $1,863 
Accrued expenses6,733 3,064 
Loan payable, current17,613  
Contract liabilities, current 1,914 
Operating lease liability, current1,146 254 
Other current liabilities5,066 220 
Total current liabilities35,313 7,314 
Contract liabilities, non-current1,554 711 
Warrant liability33,254 3,206 
SAFE notes 314,440 
Operating lease liability, non-current7,565 72 
Other non-current liabilities437 49 
Total liabilities78,122 325,792 
Stockholders’ deficit:
Common stock, $0.00001 par value; 250,000,000 shares authorized and 80,580,232 issued and outstanding as of September 30, 2021; 142,804,498 shares authorized and 62,510,690 issued and outstanding as of December 31, 2020
1 1 
Additional paid-in capital333,471 39,866 
Accumulated deficit(205,954)(329,338)
Total stockholders’ equity (deficit)127,518 (289,472)
Total liabilities and stockholders’ equity (deficit)$205,640 $36,320 
The accompanying notes are an integral part of these condensed consolidated financial statements
The balance sheet at December 31, 2020 has been derived from the audited financial statements at that date
5

Tables of Contents
MOMENTUS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share data)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021202020212020
Service revenue$200 $ $330 $ 
Cost of revenue(184) (135) 
Gross margin384  465  
Operating expenses:
Research and development expenses9,047 5,377 39,747 13,758 
Selling, general and administrative expenses12,057 4,056 35,802 7,478 
Total operating expenses21,104 9,433 75,549 21,236 
Loss from operations(20,721)(9,433)(75,084)(21,236)
Other income (expense):
Decrease (increase) in fair value of SAFE notes26,924 (99,107)209,291 (102,695)
Decrease (increase) in fair value of warrants(2,712)(1,324)9,826 (1,317)
Interest income 1 2 7 
Interest expense(4,328)(67)(8,685)(145)
SEC settlement  (7,000) 
Other income (expense)(4,778)(993)(4,965)(942)
Total other income (expense)15,107 (101,489)198,469 (105,093)
Income (loss) before income taxes(5,614)(110,923)123,385 (126,329)
Income tax provision  1 1 
Net income (loss)$(5,614)$(110,923)$123,384 $(126,329)
Net income (loss) per share, basic $(0.09)$(1.77)$2.06 $(1.97)
Net income (loss) per share, diluted$(0.09)$(1.77)$1.92 $(1.97)
Weighted average shares outstanding, basic60,589,566 62,722,340 59,873,199 64,244,006 
Weighted average shares outstanding, diluted60,589,566 62,722,340 64,232,537 64,244,006 
The accompanying notes are an integral part of these condensed consolidated financial statements
6

Tables of Contents
MOMENTUS INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(UNAUDITED)
(in thousands, except per share data)

Preferred stockFF Preferred stockCommon stock –
Class A
Common stock –
Class B
Treasury StockCommon stock –
Class A
Additional paid in capitalAccumulated deficitTotal stockholders’ equity (deficit)
SharesAmountSharesAmountSharesAmountSharesAmountSharesAmountSharesAmount
Balance, December 31, 2020144,875,941 — 20,000,000 — 18,398,005 — 70,000,000 — — —  $ $39,866 $(329,338)$(289,472)
Retroactive application of recapitalization(144,875,941)— (20,000,000)— (18,398,005)— (70,000,000)— — — 62,510,6901  — — 
Balance, December 31, 2020, as adjusted $—  $—  $—  $— — $— 62,510,690$1 $39,866 $(329,338)$(289,472)
Issuance of common stock upon exercise of stock options— — — — — — — — — — 270,582  24 — 24 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — — — 5,768 — 5,768 
Net income— — — — — — — — — — — — — 64,671 64,671 
Balance, March 31, 2021— $— — $— — $— — $— — $— 62,781,272$1 $45,658 $(264,667)$(219,009)
Issuance of common stock upon exercise of stock options— — — — — — — — — — 39,515 — 11 — 11 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — 2,344 — 2,344 
Share repurchase— — — — — — — — — — (25,601,733) (22,000)— (22,000)
Net income— — — — — — — — — — — — — 64,327 64,327 
Balance, June 30, 2021— $— — $— — $— — $— — $— 37,219,054$ $26,013 $(200,340)— $(174,326)
Issuance of common stock upon exercise of stock options— — — — — — — — — — 966,827 $ $239 $— $239 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — — $— $3,075 $— $3,075 
Warrant conversion upon exercise— — — — — — — — — — 638,125 $ $7,001 $— $7,001 
Shares issued upon conversion of SAFE Notes— — — — — — — — — — 12,403,469 $ $136,001 $— $136,001 
Share repurchase— — — — — — — — — — — $— $(18,000)$— $(18,000)
Issuance of common stock and warrants, in connection with PIPE— — — — — — — — — — 11,000,000 $ $79,529 $— $79,529 
Issuance of common stock and warrants, net of transaction costs, upon merger— — — — — — — — — — 18,352,757 $ $99,612 $— $99,612 
Net loss— — — — — — — — — — — $— $— $(5,614)$(5,614)
Balance, September 30, 2021— $— — $— — $— — $— — $— 80,580,232$1 $333,471 $(205,954)$127,518 
The accompanying notes are an integral part of these condensed consolidated financial statements
7

Tables of Contents
Preferred stockFF Preferred stockCommon stock –
Class A
Common stock –
Class B
Treasury StockCommon stock –
Class A
Additional paid in capitalAccumulated deficitTotal stockholders’ deficit
SharesAmountSharesAmountSharesAmountSharesAmountSharesAmountSharesAmount
Balance, December 31, 2019144,875,941 — 20,000,000 — 15,493,658 — 80,000,000 — — —  $ $37,004 $(22,307)$14,698 
Retroactive application of recapitalization(144,875,941)— (20,000,000)— (15,493,658)— (80,000,000)— — — 64,244,0071  — — 
Balance, December 31, 2019, as adjusted $—  $—  $—  $— — $— 64,244,007$1 $37,004 $(22,307)$14,698 
Issuance of common stock upon exercise of stock options— — — — — — — — — — 177,345 — 7 — 7 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — — — 102 — 102 
Stock contribution from co-founder— — — — — — — — — — (2,467,415)— — — — 
ASC 842 lease accounting adoption— — — — — — — — — — — — — (4)(4)
Net loss— — — — — — — — — — — — — (6,255)(6,255)
Balance, March 31, 2020— $— — $— — $— — $— — $— 61,953,937$1 $37,112 $(28,566)$8,547 
Issuance of common stock upon exercise of stock options— — — — — — — — — — 17,956 — 5 — 5 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — — — 167 — 167 
Net loss— — — — — — — — — — — — — (9,152)(9,152)
Balance, June 30, 2020— $— — $— — $— — $— — $— 61,971,893$1 $37,285 $(37,718)$(432)
Issuance of common stock upon exercise of stock options— — — — — — — — — — 412,514 — 49 — 49 
Stock-based compensation – Stock options and RSAs— — — — — — — — — — — — 1,374 — 1,374 
Net loss— — — — — — — — — — — — (110,923)(110,923)
Balance, September 30, 2020— $— — $— — $— — $— — $— 62,384,407$1 $38,707 $(148,640)$(109,932)
The accompanying notes are an integral part of these condensed consolidated financial statements
8

Tables of Contents
MOMENTUS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)
Nine Months Ended
September 30,
20212020
Cash flows from operating activities:
Net income (loss)$123,384 $(126,329)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization768 419 
Amortization of debt discount and issuance costs6,935 34 
(Decrease) increase in fair value of warrants(9,826)1,317 
(Decrease) increase in fair value of SAFE notes(209,291)102,695 
Impairment of prepaid launch costs9,450  
Stock-based compensation expense11,187 1,642 
Changes in operating assets and liabilities:
Prepaids and other current assets(15,350)(4,873)
Other non-current assets(2,908)360 
Accounts payable4,357 865 
Accrued expenses4,546 1,061 
Other current liabilities4,829 61 
Contract liabilities(1,071)1,681 
Lease liability and right of use asset856  
Other non-current liabilities5  
Net cash used in operating activities(72,129)(21,068)
Cash flows from investing activities:
Purchases of property, machinery and equipment(2,835)(1,245)
Purchases of intangible assets(16)(99)
Net cash used in investing activities(2,852)(1,345)
Cash flows from financing activities:
Proceeds from issuance of SAFE notes30,853 44,650 
Proceeds from issuance of loan payable25,000 2,458 
Proceeds from exercise of stock options278 61 
Payment of notes payable (1,015)
Payment of debt issuance costs(144)(37)
Payment of warrant issuance costs(31)(1)
Payment for share repurchase(40,000) 
Proceeds from PIPE110,000  
Proceeds from issuance of common stock upon Merger137,282  
Payments for transaction costs(32,585) 
Net cash provided by financing activities230,653 46,116 
Increase in cash, cash equivalents and restricted cash155,672 23,704 
Cash, cash equivalents and restricted cash, beginning of period23,520 13,002 
Cash, cash equivalents and restricted cash, end of period$179,191 $36,706 
Supplemental disclosure of non-cash investing and financing activities
Issuance of common stock related to conversion of SAFE notes$136,001 $ 
Issuance of common stock related to exercise of warrant liabilities$7,001 $ 
Reclassification of deferred offering costs
$6,203 $ 
Deferred offering costs in accounts payable and accrued expenses at period end$ $979 
Assumption of merger warrants liability$31,225 $ 
Operating lease right-of-use assets in exchange for lease obligations$8,501 $ 
Supplemental disclosure of cash flow information
Cash paid for income taxes$1 $1 
Cash paid for interest$1,750 $84 
The accompanying notes are an integral part of these condensed consolidated financial statements
9

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Nature of Operations
The Company
Momentus Inc. (together with its consolidated subsidiaries “Momentus” or the “Company”) is a U.S. commercial space company that plans to offer in-space infrastructure services, including in-space transportation, hosted payloads and in-orbit services. Momentus believes it can make new ways of operating in space possible with its planned in-space transfer and service vehicles that will be powered by an innovative water plasma-based propulsion system that is under development. The Company anticipates flying its Vigoride vehicle to Low Earth Orbit on a third-party launch provider as early as June 2022, subject to receipt of licenses and government approvals, and successful completion of our current efforts to get the system ready for flight.
Background and Business Combination
On August 12, 2021, the Company consummated a merger pursuant to certain Agreement and Plan of Merger, dated October 7, 2020, and as amended on March 5, 2021, April 6, 2021, and June 29, 2021 (the “Merger Agreement”), by and among Stable Road Acquisition Corp (“SRAC”), Project Marvel First Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of SRAC (“First Merger Sub”), and Project Marvel Second Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of SRAC (“Second Merger Sub”), pursuant to which First Merger Sub merged with and into Momentus Inc., a Delaware corporation (“Legacy Momentus”) with Legacy Momentus as the surviving corporation of the First Merger Sub, and immediately following which Legacy Momentus merged with and into the Second Merger Sub, with the Second Merger Sub as the surviving entity (the “Business Combination”). In connection with the closing of the Business Combination (the “Closing”), the Company changed its name from Stable Road Acquisition Corp. to Momentus Inc., and Legacy Momentus changed its name to Momentus Space, LLC.
The Merger was accounted for as a reverse recapitalization under ASC Topic 805, Business Combinations ("ASC 805") in accordance with accounting principles generally accepted in the United States (“GAAP”). Under this method of accounting, SRAC, who was the legal acquirer, is treated as the “acquired” company for financial reporting purposes and Legacy Momentus is treated as the accounting acquirer. Accordingly, for accounting purposes, the Merger is treated as the equivalent of a capital transaction in which Legacy Momentus issued stock for the net assets of SRAC, with no goodwill or other intangible assets recorded, and Legacy Momentus’ financial statements became those of the Company. Reported shares and earnings per share available to holders of the Company’s common stock, prior to the Business Combination, have been retroactively restated as shares reflecting the exchange ratio established in the Business Combination. See Note 3 for more information.
Pursuant to the Amended and Restated Certificate of Incorporation of the Company, at the Closing, each share of SRAC’s Class B Common Stock, par value $0.0001 per share (the “Class B Common Stock”), converted into one share of SRAC’s Class A Common Stock. After the Closing and following the effectiveness of the Second Amended and Restated Certificate of Incorporation of the Company, each share of Class A Common Stock was automatically reclassified, redesignated and changed into one validly issued, fully paid and non-assessable share of the Company’s Common Stock, par value $0.00001 per share (the “Common Stock”), without any further action by the Company or any stockholder thereof.
Prior to the Business Combination, SRAC’s units, public shares, and public warrants were listed on the Nasdaq under the symbols “SRACU,” “SRAC,” and “SRACW,” respectively. On August 13, 2021, the Company's Class A common stock and public warrants began trading on the Nasdaq, under the symbols “MNTS” and “MNTSW,” respectively.
On October 7, 2020 and July 15, 2021, SRAC entered into subscription agreements with certain investors (the “PIPE Investors”) to which such investors collectively subscribed for an aggregate of 11,000,000 shares of the Company’s Class A common stock at $10.00 per share for aggregate gross proceeds of $110.0 million (the “PIPE Investment”). The PIPE Investors were also granted an equal number of private warrants to purchase the Company’s Class A common stock at $11.50 per share. The warrants were recorded as a derivative liability under ASC 815, Derivatives and Hedging and the warrant liability was initially valued at $30.5 million. See Note 11 for more information. The PIPE Investment was consummated concurrently with the closing of the Merger.
10

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies
Our significant accounting policies are detailed in “Note 2. Summary of Significant Accounting Policies” of our Annual Report presented in our Proxy Statement/Prospectus filed on July 21, 2021. There have been no significant changes to our accounting policies during the three and nine months ended September 30, 2021.
Unaudited Interim Financial Information
The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The balance sheet as of December 31, 2020 was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP for audited financial statements. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).
The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited financial statements. In the opinion of the Company’s management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments that are necessary to present fairly the Company’s financial position as of September 30, 2021 and December 31, 2020, the net income (loss) for the three and nine months ended September 30, 2021 and 2020, the stockholders’ equity (deficit) for the three and nine months ended September 30, 2021 and 2020, and cash flows for the nine months ended September 30, 2021 and 2020. Such adjustments are of a normal and recurring nature. The results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results for the year ending December 31, 2021, or for any future period. These interim condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the years ended December 31, 2020 and 2019, filed with the Securities and Exchange Commission (the “SEC”) in SRAC’s proxy statement on July 21, 2021.
Basis of Presentation
The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. GAAP. Under this method of accounting, SRAC is treated as the acquired company and Momentus Inc. is treated as the acquirer for financial statement reporting purposes (the “Combined Company”). Momentus Inc. was determined to be the accounting acquirer as Momentus Inc.'s shareholders prior to the Merger had the greatest voting interest in the combined entity, Momentus Inc. comprises all of the ongoing operations, and Momentus Inc.'s senior management directs operations of the combined entity.
Accordingly, for accounting purposes, the financial statements of the Combined Company represent a continuation of the financial statements of Momentus with the acquisition being treated as the equivalent of Momentus issuing stock for the net assets of SRAC, accompanied by a recapitalization. The net assets of SRAC are recorded at historical cost, with no goodwill or other intangible assets recorded.
One-time direct and incremental transaction costs incurred by the Company were recorded based on the activities to which the costs relate and the structure of the transaction; cost allocated to the issuance of equity were recorded as a reduction of the amount of equity raised, presented in additional paid in capital, while all costs allocated to the liability classified warrants were charged to expense.
In connection with the Business Combination, outstanding units of Momentus were converted into common stock of the Company, par value $0.00001 per share, representing a recapitalization. Momentus is deemed to be the predecessor of the Company, and the consolidated assets and liabilities and results of operations prior to the Closing Date are those of Momentus. The shares and corresponding capital amounts and net income (loss) per share available to common stockholders, prior to the Business Combination, have been retroactively restated as shares reflecting the exchange ratio established in the Business Combination Agreement.
11

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies (cont.)
Reclassifications
Certain reclassifications have been made to the prior year’s financial statements to conform to the current year’s presentation. None of the reclassifications have changed the total assets, liabilities, stockholders’ deficit, income, expenses or net losses previously reported.
Going Concern
The Company’s condensed consolidated financials have been prepared assuming the Company will continue as a going concern. The Company has had a history of operating losses and negative cash flows from operations. As of the date of the most recent audited financial statements, December 31, 2020, the Company had concluded that there was substantial doubt about its ability to continue as a going concern within one year of that issuance date. Since that date, the Company has obtained additional funding of $247.3 million in connection with the Business Combination to support its ongoing operations and future growth of the Company. Management has concluded that substantial doubt regarding the Company’s ability to continue as a going concern beyond the next 12 months has been alleviated based upon the recent funding.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Accordingly, actual results could differ from those estimates. Significant estimates inherent in the preparation of the financial statements include, but are not limited to, accounting for useful lives of property, machinery and equipment, net, intangible assets, net, accrued liabilities, income taxes including deferred tax assets and liabilities, impairment valuation, stock-based awards, SAFE notes and warrant liabilities.
COVID-19 Pandemic
As a result of the COVID-19 pandemic, the U.S. government and various states implemented quarantine requirements and travel restrictions. The extent of the impact of COVID-19 on the Company’s financial statements will depend on future developments, including the duration of the outbreak, resurgences and emergence of variants, all of which are highly uncertain and cannot be predicted. The potential impact of COVID-19 on the Company’s operations is inherently difficult to predict and could adversely impact the Company’s business, financial condition or results of operations.
Emerging Growth Company Status
Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of the extended transition period is irrevocable. The Company is an “emerging growth company” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”) and has elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards. The Company will remain an emerging growth company until the earliest of (i) the last day of the fiscal year in which the market value of Common Stock that is held by non-affiliates exceeds $700 million as of the end of that year’s second fiscal quarter, (ii) the last day of the fiscal year in which the Post-Combination Company has total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which the Company has issued more than $1 billion in non-convertible debt in the prior three-year period or (iv) December 31, 2024, and the Company expects to continue to take advantage of the benefits of the extended transition period, although it may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. This may make it difficult or impossible to compare the Company’s financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.
Restricted Cash
12

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies (cont.)
Restricted cash primarily represents deposited cash that is restricted by financial institutions for two purposes. $0.4 million is restricted as collateral for a letter of credit issued to the Company’s landlord in accordance with the terms of a lease agreement entered into in December 2020. A portion of this restricted cash ($0.1 million) is classified as a current asset as it will be returned to the Company one year following the completion of the Business Combination with SRAC, while the remaining $0.3 million is classified as a non-current asset as it will be returned to the Company upon the occurrence of future events which are expected to occur beyond at least one year from September 30, 2021. $0.7 million is restricted for expenditures related to the National Security Agreement (“NSA”) See Note 12.
Revenue Recognition
The Company enters into contracts for ‘last-mile’ satellite and cargo delivery, payload hosting and in-orbit servicing options with customers that are primarily in the aerospace industry. From inception to September 30, 2021, the Company has not completed a commercial launch of customer cargo and as a result, has not recognized revenue to date for services. However, as of September 30, 2021 and December 31, 2020, the Company has signed contracts with customers including firm orders and options (some of which have already been exercised by customers) and has collected $1.6 million and $2.6 million, respectively, in customer deposits, which are recorded as current and non-current contract liabilities in the Company’s condensed consolidated balance sheet. Included in the collected amount as of September 30, 2021 are $1.6 million of non-current deposits. The Company’s first launch with customers is currently anticipated to occur as early as June 2022, subject to receipt of licenses and government approvals, and successful completion of our current efforts to get the system ready for flight. While a portion of the deposit balance relates to performance obligations that may be satisfied over the next 12 months, the Company will classify customer deposits as non-current until the inaugural launch date is reasonably assured.
The Company will recognize revenue (along with any other fees that have been paid) upon the earlier of the satisfaction of the Company’s performance obligation or when the customer cancels the contract. For the nine months ended September 30, 2021, the Company recognized revenue related to customer cancelled contracts of $0.3 million, which were previously recorded as a contract liability. The Company also recorded $(0.14) million as a reduction of cost of revenue which represents the reversal of a contingency recorded during the prior year for loss contracts. During the three months ended September 30, 2021 the Company signed amendments with those customers such that the services will no longer be free of charge. The reversed contingency was offset by costs incurred related to one of the cancelled contracts.
While the Company’s standard contracts do not contain refund or recourse provisions that enable its customers to recover any non-refundable fees that have been paid, the Company may issue full or partial refunds to customers on a case-by-case basis as necessary to preserve and foster future business relationships and customer goodwill. As a result of the Company’s inability to complete any launches in 2021 (refer to Note 4 for additional information), the Company issued customer refunds of $1.4 million during the three months ended September 30, 2021.
Deferred Fulfillment and Prepaid Launch Costs
As of September 30, 2021, and December 31, 2020, the Company had $3.0 million and $4.7 million, respectively, of deferred fulfillment and prepaid launch costs in the accompanying condensed consolidated balance sheets. On May 21, 2021, the Company received notification from one of its launch service providers that it was terminating two launch service agreements for flights scheduled during calendar year 2021 and that they considered the Company to be in default of prior payments totaling $8.7 million. The Company believes the prepayments will be non-recoverable as this was the third time the payload was rescheduled. As a result of the notification from one of its launch service providers, the Company recorded an impairment of $8.7 million of current prepaid launch costs during the nine months ended September 30, 2021. See Note 4 for more information. See Note 15 for more information about the potential recovery of a portion of the impaired launch costs.
SAFE Notes
The Company issued Simple Agreement for Future Equity (“SAFE”) notes to investors during the three months ended March 31, 2021 and the years ended December 31, 2020 and 2019, which were converted to shares of common stock in connection with the Business Combination. Prior to conversion, the Company determined that the SAFE notes were not a legal form of debt (i.e., no creditors’ rights). The SAFE notes included a provision allowing
13

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies (cont.)
for the investors to receive a portion of the proceeds upon a change of control equal to the greater of their investment amount or the amount payable based upon a number of shares of common stock equal to the investment amount divided by the liquidity price, the occurrence of which is outside the control of the Company. This provision required that the SAFE notes be classified as marked-to-market liabilities pursuant to ASC 480. See Note 9 for more information.
Deferred Offering Costs
Offering costs consist of legal, accounting, underwriting fees and other costs incurred that were directly related to the Company’s Business Combination. Upon completion of the Business Combination, all deferred offering costs were netted with proceeds from the Business Combination, with costs relating to the issuance of equity recorded as a reduction of the amount of equity raised, presented in additional paid in capital, while all costs related to the liability classified warrants was estimated and charged to expense. See Note 3 for more information.
Fair Value Measurement
The Company uses valuation approaches that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. A three-tiered hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value. This hierarchy requires that the Company use observable market data, when available, and minimize the use of unobservable inputs when determining fair value:
Level 1, observable inputs such as quoted prices in active markets;
Level 2, inputs other than the quoted prices in active markets that are observable either directly or indirectly;
Level 3, unobservable inputs in which there is little or no market data, which requires that the Company develop its own assumptions.
The fair values of cash and cash equivalents, accounts payable, and certain prepaid and other current assets and accrued expenses approximate carrying values due to the short-term maturities of these instruments which fall with Level 1 of the fair value hierarchy. The carrying value of certain other non-current assets and liabilities approximates fair value. The Company had no Level 2 inputs on September 30, 2021 and December 31, 2020.
The Company’s SAFE note liabilities, prior to conversion in connection with the Business Combination, were marked-to-market liabilities pursuant to ASC 480 and were classified within Level 3 of the fair value hierarchy as the Company was using a backsolve method within the Black Scholes Option Pricing model, which allowed the Company to solve for the implied value of the business based on the terms of the SAFE investments. Significant unobservable inputs included volatility and expected term. The Company performed a fair value measurement of the SAFE notes on the Closing Date and recorded the change in the fair value of the instruments prior to converting them to equity.
Warrant Liability
The Company’s Private Warrants and Stock Purchase Warrants (defined and discussed in Note 11) are recorded as derivative liabilities pursuant to ASC 815 and are classified within Level 3 of the fair value hierarchy as the Company is using the Black Scholes Option Pricing model to calculate fair value. Significant unobservable inputs, prior to the Company’s stock being publicly listed, included stock price, volatility and expected term. At the end of each reporting period, changes in fair value during the period are recognized as a components of other income (expense), net within the condensed consolidated statements of operations. The Company will continue to adjust the warrant liabilities for changes in fair value until the earlier of a) the exercise or expiration of the warrants or b) the redemption of the warrants, at which time the warrants will be reclassified to additional paid-in capital.
The warrants issued by Momentus Inc. prior to the Business Combination were redeemed in connection with the Merger and as a result, the Company performed a fair value measurement of those notes on the Closing Date and recorded the change in the instruments’ fair values prior to converting them to equity. The warrants assumed by the Company as a result of the Business Combination remain outstanding.
14

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies (cont.)
Basic and Diluted Income (Loss) Per Share
Net income (loss) per share is provided in accordance with FASB ASC 260-10, “Earnings per Share”. Basic net income (loss) per share is computed by dividing losses available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per share gives effect to all dilutive potential common shares outstanding during the period. Diluted loss per share excludes all potential common shares and SAFE notes if their effect is anti-dilutive. The table below details the excluded potential common shares where their effect is anti-dilutive for the three and nine months ended September 30, 2021 and 2020.
Three Months Ended September 30, 2021Nine Months Ended September 30, 2021
Three and Nine Months Ended September 30, 2020
Options outstanding under stock incentive plan4,304,660  7,359,841 
Options outstanding outside of stock incentive plan  134,586 
Common stock warrants20,206,069 19,897,500 499,534 
SAFE notes outstanding (shares not reserved)  13,909,900 
Total24,510,729 19,897,500 21,903,861 
Recently Issued Accounting Standards
In August 2020, the FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the guidance on the issuer’s accounting for convertible debt instruments by removing the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. As a result, entities will not separately present in equity an embedded conversion feature in such debt. Instead, they will account for a convertible debt instrument wholly as debt, unless certain other conditions are met. The elimination of these models will reduce reported interest expense and increase reported net income for entities that have issued a convertible instrument that was within the scope of those models before the adoption of ASU 2020-06. Also, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share and the treasury stock method will be no longer available. The provisions of ASU 2020-06 are applicable for fiscal years beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company is currently evaluating the impact of ASU 2020-06 on its financial statements.
Although there are several other new accounting pronouncements issued or proposed by the FASB, which have been adopted or will be adopted as applicable, management does not believe any of these accounting pronouncements has had or will have a material impact on the Company’s financial position or results of operations.
Recently Adopted Accounting Standards
In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the accounting for income taxes, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in income taxes. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. The Company adopted this standard on January 1, 2021. The adoption of this standard did not have a material impact on the Company’s financial statements.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This guidance is intended to increase transparency and comparability among organizations by recognizing lease assets and liabilities on the balance sheet and disclosing key information about lease arrangements. The Company adopted the standard as of January 1, 2020, using the modified retrospective approach and has elected to use the optional transition method which allows the Company to apply the guidance of ASC 840, including disclosure requirements, in the comparative periods presented. In addition, the Company elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease classification related to agreements entered prior to adoption.
The adoption of the new standard resulted in recognition of operating lease ROU assets and operating lease liabilities of $0.55 million and $0.56 million, respectively, as of January 1, 2020. There was no material cumulative
15

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 2. Summary of Significant Accounting Policies (cont.)
impact of transition to accumulated deficit as of the adoption date. The standard did not materially impact the accompanying statements of operations and had no impact on the accompanying statements of cash flows.
Note 3. Reverse Recapitalization
As discussed in Note 1, "Nature of Operations", on the Closing Date, SRAC completed the acquisition of Momentus Inc. and acquired 100% of Momentus Inc.’s shares and Momentus Inc. received gross proceeds of $247.3 million, which includes $137.3 million in proceeds from issuance of common stock upon the Merger and $110.0 million in proceeds from the PIPE Investment.
The Merger was accounted for as a reverse recapitalization under ASC 805, with Momentus Inc. as the accounting acquirer and SRAC as the acquired company for accounting purposes. Momentus Inc. was determined to be the accounting acquirer as Momentus Inc.'s stockholders prior to the Merger had the greatest voting interest in the combined entity, Momentus Inc. comprises all of the ongoing operations, and Momentus Inc.'s senior management directs operations of the combined entity. Accordingly, all historical financial information presented in these unaudited condensed consolidated financial statements represents the accounts of Momentus Inc. and its wholly owned subsidiary. Net assets were stated at historical cost consistent with the treatment of the transaction as a reverse recapitalization of Momentus Inc.
One-time direct and incremental transaction costs incurred by the Company were recorded based on the activities to which the costs relate and the structure of the transaction. Costs of $27.8 million allocated to the issuance of equity were recorded as a reduction of equity raised, presented in additional paid in capital, while costs of $4.8 million allocated to the liability classified warrants were charged to expense. On the Closing Date, each holder of Momentus Inc. preferred and common stock received approximately 0.2467416 shares of the Company’s Class A common stock, par value $0.00001 per share. See Note 11 for additional details of the Company's stockholders' equity (deficit) prior to and subsequent to the Merger.
All equity awards of Momentus Inc. were assumed by the Company and converted into comparable equity awards that are settled or exercisable for shares of the Company’s Class A common stock. As a result, each outstanding stock option was converted into an option to purchase shares of the Company’s Class A common stock based on an exchange ratio of 0.2467416, and each outstanding restricted stock award was converted into restricted stock awards of the Company that, upon vesting, may be settled for shares of the Company’s Class A common stock based on an exchange ratio of 0.2467416.
Outstanding private warrants of Momentus Inc. common stock were also converted into warrants to purchase shares of the Company’s Class A common stock based on an exchange ratio of 0.2467416.
Each public and private warrant of SRAC that was unexercised at the time of the Merger was assumed by the Company and represents the right to purchase one share of the Company’s Class A common stock upon exercise of such warrant. See Note 11 for more information.
Lock-up Agreements
In conjunction with the Closing, certain insider stockholders executed lock-up agreements, pursuant to which such stockholders agree not to transfer any shares of Class A common stock for a period of six months after the Closing or, if earlier, the first date the closing price of the Class A Common Stock equals or exceeds $12.00 per share for any 20 trading days within any 30-trading day period following the Closing.
PIPE Investment
On October 7, 2020 and July 15, 2021, SRAC entered into subscription agreements with certain investors (the “PIPE Investors”) to which such investors collectively subscribed for an aggregate of 11,000,000 shares of the Company’s Class A common stock at $10.00 per share for aggregate gross proceeds of $110.0 million (the “PIPE Investment”). The PIPE Investors were also granted an equal number of private warrants to purchase the Company’s Class A common stock at $11.50 per share. The warrants were recorded as a derivative liability under ASC 815, Derivatives and Hedging, and the warrant liability was initially valued at $30.5 million. See Note 11 for more information. The PIPE Investment was consummated concurrently with the closing of the Merger.
Note 4. Prepaids and Other Current Assets
16

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Prepaids and other current assets consisted of the following:
(in thousands)September 30,
2021
December 31,
2020
Prepaid launch costs, current$ $2,260 
Prepaid research and development5,491 1,453 
Prepaid insurance and other assets4,917 796 
Total$10,408 $4,508 
As of September 30, 2021 and December 31, 2020, the non-current portion of prepaid launch costs recorded in other non-current assets was $3.0 million and $2.4 million, respectively.
FAA application
On May 10, 2021, the Company received a letter from the U.S. Federal Aviation Administration (“FAA”) denying the Company’s application for a payload review for the then-planned June 2021 launch. According to the letter, during an interagency consultation, the FAA was informed that the launch of the Company’s payload posed national security concerns associated with the Company’s then-current corporate structure. The letter further stated that the FAA understood that the Company was undergoing a process that might resolve the national security concerns, and that the FAA could reconsider a payload application when that process was completed.
As a result of the FAA application denial, on May 21, 2021, the Company received notification from one of its launch service providers that it was terminating two launch service agreements for flights scheduled during calendar year 2021 and that they considered the Company to be in default of prior payments totaling $8.7 million. The Company believes the prepayments will be non-recoverable as this was the third time the payload was rescheduled. As a result of the notification from one of its launch service providers, the Company recorded an impairment charge of $8.7 million of prepaid launch costs during the nine months ended September 30, 2021. See Note 15 for more information about the potential recovery of a portion of the impaired launch costs.
Note 5. Property, Machinery and Equipment, net
Property, machinery and equipment, net consisted of the following:
(in thousands)September 30,
2021
December 31,
2020
Computer equipment$178 $178 
Furniture and fixtures206 206 
Leasehold improvements2,533 665 
Machinery and equipment3,136 1,936 
Construction in-progress245 118 
Property, machinery and equipment, gross6,299 3,103 
Less: accumulated depreciation(1,513)(782)
Property, machinery and equipment, net$4,786 $2,321 
Depreciation expense related to property, machinery and equipment was $0.3 million and $0.7 million for the three and nine months ended September 30, 2021, respectively, and was $0.1 million and $0.4 million for the three and nine months ended September 30, 2020, respectively.
Note 6. Intangible Assets, net
Intangible assets, net consisted of the following as of September 30, 2021:
(in thousands)Gross ValueAccumulated AmortizationNet ValueWeighted average remaining amortization period (in years)
Patents/Intellectual Property$432 $(88)$344 7.19

17

Tables of Contents
MOMENTUS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Intangible assets, net consisted of the following as of December 31, 2020:
(in thousands)Gross ValueAccumulated AmortizationNet ValueWeighted average remaining amortization period (in years)
Patents/Intellectual Property$357 $(51)$305 7.62
Amortization expense related to intangible assets was $0.01 million and $0.04 million for the three and nine months ended September 30, 2021, respectively, and was $0.01 million and $0.02 million for the three and nine months ended September 30, 2020, respectively.
As of September 30, 2021, the future estimated amortization expense related to intangible assets is as follows:
(in thousands)
Year ending December 31,Amount
2021 (remainder)$14 
202254 
202354 
202446 
202540 
Thereafter136 
Total$344 
There were no intangible asset impairments during the three and nine months ended September 30, 2021 and 2020.
Note 7. Leases
In January 2021, the Company commenced a new lease at a new location in San Jose, California. The lease expires in February 2028. The Company is obligated to pay approximately $11 million over the term of the lease. The Company leases office space under non-cancellable operating leases with terms expiring from December 2021 through February 2028. The leases require monthly lease payments that are subject to annual increase throughout the lease term.
The Company adopted ASC 842 as of January 1, 2020, using the modified retrospective approach. Rent expense was $0.4 million and $1.3 million for the three and nine months ended September 30, 2021, respectively, and was $