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Stockholders’ Equity (Deficit) and Stock-based Compensation
 12 Months Ended
Dec. 31, 2021
Equity [Abstract]  
Stockholders’ Equity (Deficit) and Stock-based Compensation Stockholders’ Equity (Deficit) and Stock-based Compensation
Common Stock and Preferred Stock
On August 13, 2021, The Company’s common stock began trading on the Nasdaq under the symbol “MNTS”. Pursuant to the terms of the Amended and Restated Certificate of Incorporation, the Company is authorized and has available a total of 270,000,000 shares of stock, consisting of (i) 250,000,000 shares of Class A common stock, par value $0.00001 per share (“Class A common stock”), and (ii) 20,000,000 shares of preferred stock, par value $0.00001 per share (“Preferred Stock”). As of December 31, 2021, the Company had 81,211,781 shares of Class A common stock issued and outstanding. There were no shares of Preferred Stock outstanding as of December 31, 2021.
At the Closing, the Company had 79,772,262 shares of common stock outstanding and no shares of Preferred Stock outstanding. The following summarizes the Company’s common stock outstanding immediately after the Business Combination:
Shares%
Momentus Space, LLC unit holders50,419,505 63.20 %
Public stockholders13,695,257 17.17 %
SRAC and its affiliates4,657,500 5.84 %
PIPE investors11,000,000 13.79 %
Total79,772,262 100 %
Co-Founder Divestment and Share Repurchase
In accordance with the NSA and pursuant to certain Repurchase Agreements entered into with the Company, effective as of June 8, 2021, each of Mr. Kokorich, Nortrone Finance S.A. and Brainyspace LLC (collectively “Co-Founders”) sold, back to the Company, 100% of their respective equity interests in the Company. The Company paid the Co-Founders $40.0 million for the equity interest purchased. Pursuant to the NSA, a portion of those divestment proceeds were placed in escrow accounts, and may not be released to the divested investors until after completion of audit by a third party auditor of the investors compliance with the NSA and the lapse of a 15 day period without an objection from the CFIUS Monitoring Agencies. As a subsequent event, the remaining proceeds were released from escrow to the divested investors, see Note 15. The Company recorded the consideration paid as a reduction of common stock and additional paid in capital.
Stock Purchase Warrants
In February 2021, the Company entered into a term loan (the “Term Loan”) to provide the Company up to $40.0 million of borrowing capacity, of which $25.0 million was borrowed. In conjunction with the Term Loan, warrants up to 1% of the fully diluted capitalization (including allowance for conversion of all outstanding convertible notes, SAFE notes and such warrants) of the Company were granted to the lender exercisable at the lender’s option. 80% of the 1% of the warrants were earned by the lender upon execution of the agreement. The remaining 20% of the warrants were forfeited on June 30, 2021. The warrant’s original estimated fair value of $15.6 million was recorded as a derivative liability under ASC 815, Derivatives and Hedging, with the offset recorded as a debt discount. The Company recorded the decrease in the estimated fair value of the warrant of $(10.7) million for the year ended December 31, 2021, within other income (expense) in the accompanying consolidated income statements. The warrants were exercised by the lender immediately prior to the Business Combination. The loan remains outstanding as of December 31, 2021.
In March 2020, the Company entered into the Equipment Loan to fund the acquisition of specific and eligible equipment. The financing agreement provided the Company up to $4.5 million of borrowing capacity, of which $1.5 million was borrowed (see Note 10). In conjunction with the equipment financing agreement, the Company issued stock purchase warrants to the lender, which allowed for the purchase of 191,108 shares of common stock in a subsequent round of financing. These warrants were also accounted for as a derivative liability and the decrease in the estimated fair value of the warrant of $(1.1) million for the year ended December 31, 2021 was recorded within other income (expense) in the accompanying consolidated income statements. The warrants were exercised by the lender immediately prior to the Business Combination.
Public and Private Warrants
As of December 31, 2021, the Company had public and private warrants outstanding to purchase 8,625,000 and 11,272,500 of Class A common stock, respectively, related to the Business Combination. The warrants entitle the registered holder to purchase stock at a price of $11.50 per share, subject to adjustment, at any time commencing on August 12, 2021. The public and private warrants expire on the fifth anniversary of the Business Combination, or earlier upon redemption or liquidation. Additionally, the Company has private warrants outstanding to purchase 308,569 shares of Class A common stock, with an exercise price of $0.20 per share, unrelated to the Business Combination.
The private warrants assumed in connection with the Business Combination were accounted for as a derivative liability and the change in estimated fair value of the warrants of $(25.5) million for the year ended December 31, 2021 was recorded within other income (expense) in the accompanying consolidated income statements. The public warrants and the legacy outstanding private warrants were recorded as equity in the accompany consolidated balance sheets.
Stock Incentive Plans
Legacy Stock Plans
In May 2018, the Board of Directors of Momentus Inc. approved the 2018 Stock Plan (the “Initial Plan”) that allowed for granting of incentive and non-qualified stock options and restricted stock awards (“RSAs”) to employees, directors, and consultants. The Initial Plan was terminated in November 2018. Awards outstanding under the Initial Plan continue to be governed by the terms of the Initial Plan.
In February and March 2020, the Board approved an amendment and restatement to the New 2018 Stock Plan (the “Amended and Restated 2018 Stock Plan”). No additional grants have been made since 2020 and no new grants will be made from the Amended and Restated 2018 Stock Plan, however, the options issued and outstanding under the plan continue to be governed by the terms of the Amended and Restated 2018 Stock Plan. As of December 31, 2021, the legacy plans had 5,254,222 shares available for grant. Forfeitures from the legacy plans become available under the 2021 Equity Incentive Plan, described below.
2021 Equity Incentive Plan
In connection with the Closing, the Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”), under which 5,982,922 shares of common stock were initially reserved for issuance. The 2021 Plan allows for the issuance of incentive stock options (“ISOs”), non-qualified stock options (“NSOs”), restricted stock awards (“RSAs”), stock appreciation rights (“SARs”), restricted stock units (“RSUs”), and performance awards. The Board of Directors determines the period over which grants become exercisable and grants generally vest over a four-year period. The 2021 Plan became effective immediately following the Closing. The 2021 Plan has an evergreen provision which allows for shares available for issuance under the plan to be increased on the first day of each fiscal year beginning with the 2022 fiscal year and ending on (and including) the first day of the 2031 fiscal year, in each case, in an amount equal to the lessor of (i) three percent (3.0%) of the outstanding shares on the last day of the immediately preceding fiscal year and (ii) such number of Shares determined by the Board. As of December 31, 2021 only RSU grants have been made under the 2021 Plan and there were 2,878,514 shares remaining available for grant. Grant activity under the 2021 Plan is described below.
2021 Employee Stock Purchase Plan
In connection with the Closing, the Company adopted the Employee Stock Purchase Plan (the “2021 ESPP Plan”), under which 1,595,445 shares of common stock were initially reserved for issuance. The Plan provides a means by which eligible employees of the Company may be given an opportunity to purchase shares of common stock at a discount as permitted under the Internal Revenue Code. The 2021 ESPP Plan has an evergreen provision which allows for shares available for issuance under the plan to be increased on the first day of each fiscal year beginning with the 2022 fiscal year and ending on (and including) the first day of the 2031 fiscal year, in each case, in an amount equal to the lessor of (i) half a percent (0.5%) of the outstanding shares on the last day of the calendar month prior to the date of such automatic increase (ii) 1,595,445 shares. The 2021 ESPP Plan became effective immediately following the Closing. As of December 31, 2021, no shares have been issued under the 2021 Plan. The Company has an outstanding liability pertaining to the ESPP of $0.1 million as of December 31, 2021, included in accrued expenses, for employee contributions to the 2021 ESPP Plan, pending issuance at the end of the offering period.
Options and Restricted Stock Award Activity
The following table sets forth the summary of options and RSA activity, under the Legacy Stock Plans, for the year ended December 31, 2021. RSAs were an immaterial portion of activity for the period:
(in thousands, except share-based data)Total OptionsWeighted- Average Exercise Price Per ShareWeighted- Average Remaining Contractual Term (in years)Aggregate Intrinsic Value
Outstanding as of December 31, 20207,422,995 $0.20 8.49$130,564 
Vested exercised(1,535,804)$17,487 
Forfeitures(1,830,842)
Outstanding as of December 31, 20214,056,349 $0.27 7.34$15,825 
Exercisable as of December 31, 20212,649,701 $0.26 7.20$10,379 
Vested and expected to vest as of December 31, 20214,056,349 $0.27 7.34$15,825 
The intrinsic value of options exercisable as of December 31, 2021 and 2020 was $10.4 million and $55.6 million, respectively. As of December 31, 2021, there was a total of $0.8 million in unrecognized compensation cost related to unvested options, which is expected to be recognized over a weighted-average period of 1.77 years.
The assumptions used under the Black-Scholes-Merton option-pricing model and weighted average fair value of options on the grant date are as follows:
Year Ended December 31,
20212020
Expected term (in years)N/A
5.03 – 6.23
Risk-free interest rateN/A
0.27% – 1.36%
Expected volatilityN/A
34.00% – 51.78%
Dividend yieldN/A0.00%
Fair value on grant dateN/A
$0.32 – $4.70
Restricted Stock Unit Activity
The following table sets forth the summary of RSU activity, under the 2021 Plan, for the year ended December 31, 2021:
SharesWeighted Average Grant Date Fair Value (i.e. share price)
Outstanding as of December 31, 2020— 
Granted3,260,729 $10.87 
Vested(433,188)$10.91 
Forfeited(28,288)$10.91 
Outstanding as of December 31, 20212,799,253 $10.87 
As of December 31, 2021 there was a total of $28.1 million in unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over a weighted-average period of 3.14 years. Outstanding unvested and expected to vest RSUs had an intrinsic value of $11.7 million and a weighted average contractual term of 3.14 years as of December 31, 2021.
Stock-based Compensation
The following table sets forth the stock-based compensation under the Legacy and 2021 Plans by expense type:
Year Ended December 31,
(in thousands)20212020
Research and development expenses$2,341 $187 
Selling, general and administrative expenses16,111 2,584 
Total$18,452 $2,771 
The following table sets forth the stock-based compensation under the Legacy and 2021 Plans by award type:
Year Ended December 31,
(in thousands)20212020
Legacy Options & RSAs$11,271 $2,771 
RSUs7,091 — 
ESPP20 — 
Performance Awards70 — 
Total$18,452 $2,771 
Performance Awards
Performance awards under the 2021 Plan are accounted for as liability-classified awards, as the obligations are typically a fixed monetary amount which is settled on a future date in a variable number of shares of the Company’s common stock. The variable number of potentially settled shares is not limited. Performance awards are measured at their fair value based on management’s estimates of potential outcomes of the performance. Outstanding performance awards correspond to 16,746 shares if they were settled on December 31, 2021.
Stock Option Modifications
On August 31, 2021, in connection with the resignation of one of the Company’s former officers, the Company modified the former officer’s outstanding awards, which resulted in the vesting of options for 273,571 shares. The modified option awards have an exercise price of $0.28 per share, expected term of 6.25 years, a risk-free rate of 0.86%, expected volatility of 97% and no expected dividends. This Type III modification resulted in a remeasured fair value of $10.91 per share. The incremental compensation related to the accelerated options totaled $2.9 million.
On May 22, 2021, in connection with the resignation of one of the Company’s former directors, the Company modified the former director’s outstanding award, which resulted in the vesting of options for 205,618 shares. The modified option award has an exercise price of $0.28 per share, expected term of one year, a risk-free rate of 0.04%, expected volatility of 65% and no expected dividends. This Type III modification resulted in a remeasured fair value of $10.78 per share. The incremental compensation related to the accelerated options totaled $2.2 million.
On January 25, 2021, in connection with the resignation of the Company’s former Chief Executive Officer (“CEO”), Mikhail Kokorich, the Company modified his outstanding awards, which resulted in the vesting of options for 261,070 shares. The modified option awards have exercise prices ranging from $0.04 to $0.28 per share, an expected term of one year, a risk-free interest rate of 0.10%, an expected volatility of 78% and no expected dividends. This Type III modification resulted in a remeasured fair values ranging from $20.67 to $20.91 per share. The incremental compensation related to the accelerated options totaled $5.4 million.
401(k) Plan
The Company has a 401(k) plan that it offers to its full-time employees. The Company did not contribute to the plan for the years ended December 31, 2021 and 2020.
Income (Loss) Per Share
The following table sets forth the computation of diluted net income (loss) per share:
Diluted Net Income (Loss) Per ShareYear Ended
December 31,
(in thousands, except share-based data)20212020
Numerator:
Net income (loss)$120,654 $(307,027)
Denominator:
Denominator for basic net income (loss) per share -weighted average shares outstanding65,177,87362,643,121
Dilutive options outstanding5,438,952—
Dilutive warrants outstanding301,952—
Denominator for diluted net income (loss) per share - adjusted weighted average shares outstanding70,918,777 62,643,121 
Net income (loss) per share - diluted$1.70 $(4.90)
Basic earnings per share is computed by dividing net income (loss) for the period by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing undistributed earnings allocated to common stockholders for the period by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding preferred shares, dilutive options and unvested stock units, and warrants outstanding pursuant to the treasury stock method.
For the year ended December 31, 2020 the Company incurred a net loss and as a result excluded certain outstanding options, unvested stock units, and warrants that would have been anti-dilutive, totaling 21,787,929 shares. For the year ended December 31, 2021, the Company had net income but there were 22,927,491 shares attributable to anti-dilutive warrants and unvested stock units in the period, which were excluded