Greetings, and welcome to the Solid Power Fourth Quarter and Year-End 2021 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jennifer Almquist, Director of Investor Relations at Solid Power. Thank you, Jennifer. You may begin.

Thanks, Paul, and thank you everyone for joining us today. Joining me on the call today are Solid Power's Chief Executive Officer, Doug Campbell; and Chief Financial Officer, Kevin Paprzycki. Copies of today's press release as well as the presentation that accompanies this conference call are available on the Investor Relations section of our website at ir.solidpowerbattery.com. Before we get started, I'd like to remind you that parts of our discussion today will include forward-looking statements as defined by US securities laws. These forward-looking statements are based on management's current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements to reflect future events or circumstances. For a discussion of the risks and uncertainties that could cause actual results to differ materially from those expressed in our forward-looking statements, please see our most recent filings with the Securities and Exchange Commission, which can be found on our website at ir.solidpowerbattery.com. With that, let me turn it over to Doug Campbell.

Thank you, Jim. Good afternoon, everyone. Today is the first earnings call on our newly established public company existence, and I'm really excited to be here today updating you on our progress. As for today's call, I'll begin with a business update. I'll then pass it over to Kevin, who will take you through the financials and then I'll return with some concluding remarks. It goes without saying that 2021 was a phenomenal year for the company and I'm happy to report that 2022 is shaping up to be an even more successful year. In short, today Solid Power finds itself in a favorable position, thanks to the tireless work of our employees, the unwavering support from our industry partners and the confidence placed on us by the investment community, as reflected in our successful SPAC transaction completed late last year. As a result, we have listened to our key stakeholders and have made some key updates in our approach to product commercialization that can be broadly describe as an acceleration on all fronts in order to take advantage of the very fortunate situation that we find ourselves in today. I'll begin with a quick summary of some of the key announcements and updates that we're making today. Beginning first with earnings, I am happy to report that we exceeded our projected revenues for 2021 and are projecting to meaningfully increase this revenue amount again in 2022. We ended the year with more than $0.5 billion in cash and marketable securities, giving us ample runway and flexibility to invest as needed to be responsive to increasing demand. Second is our infrastructure investments, including our EV line capable of full scale cell production in our second facility, devoted to scaled electrolyte material production, both of which remain on schedule, despite the…

Thanks, Doug. I'm going to start out with some color on the '21 results we announced this afternoon, and then walk through our 2022 financial outlook. So the team's credit, our '21 financial results came in very close to the plan Solid Power put together. 2021 revenues came in slightly ahead of expectations, up roughly $600,000 from the previous year. This was driven by higher revenue on our government contracts where we received grants to fund our research and development. 2021 operating expenses were $29.3 million, compared to $13.7 million during the prior year. This increase was driven by a higher level of development spending, which is primarily labor, materials and supplies. Our increased expenses also included slightly higher costs as we prepare to become a public company. During the year, we also recognized a noncash gain related to the fair value of our warrant liabilities for $51 million and a loss of $3.6 million related to the termination of a manufacturing rights agreement back in early '21. These items resulted in net income for the year of $18.1 million, which was again very close to our internal projections, if you factor out the mark-to-market gain and termination loss. Looking in our liquidity, our successful series B and SPAC financings put our balance sheet in a very favorable position. We ended '21 with combined cash and marketable securities of $589.3 million. This was inclusive of net proceeds from the merger of $495.3 million. Our '21 cash used in operations was $25.4 million and our total capital equipment investment for '21 came in at $12.6 million. This was actually a little lighter than we expected with some of our late '21 capital spend falling into early '22. Shifting to '22, we are initiating high level revenue and cash flow guidance, solely…

Thanks, Kevin. In closing, I cannot overstate how extremely proud I am of what the Solid Power team has accomplished and I am very confident of the path forward. We have positioned Solid Power as a leader in the development of truly all solid-state batteries, thereby well positioning us in a market that is poised for growth. We are building our business for the long term with an eye on long-term returns. We have a unique business model, focused on becoming the industry leader in solid-state battery materials, while simultaneously monetizing our solid-state battery cell products through commercialization partners. Lastly, and most importantly, I want to thank our employees, development partners and customers for their efforts and unwavering support. And with that operator, we will now take questions.

[Operator Instructions] Our first question is from Mike Shlisky with D.A. Davidson. Please proceed with your question.

I wanted to ask first, maybe about the new protections for cash usage for the CapEx, et cetera. I understand that it's some - this is going to happen earlier than expected or earlier than initially anticipated. I've tried to model out all the way through 2028 or a few years out from here, what year should I take these expenses out of and put them into the 2022 outlook? Is it a - at the end, being pushed forward or is it just 2023 going to 2022, what's the right cadence now, looking ahead?

Great, great question, Mike. Most of these accelerated CapEx are coming out of '23 and '24. But I want to emphasize that when you look at our long-term plan, all the way out through '28 and again, we're not going to guide here on the future years, but there's zero increase here. It's merely just an acceleration with most of that coming from '23 and '24.

Okay, great. Maybe for my follow-up, maybe you guys can comment on current events and what's happening out there in the world of raw materials. I guess, I'm curious just a conflict in Ukraine and the price of nickel and other materials, have anything to do, have you got any additional inquiries from customers based on what could be rising lithium-ion battery costs and do any of the materials in your electrolyte, actually - the - do they consist of any materials that are found mostly in that region of the world?

So, I guess several questions in there. Beginning first with, obviously, the rising cost, especially in nickel has not gone unnoticed. For us, because we're more in the development phase, at least in the near to mid-term, the cost of nickel and of course, associated with that cobalt, are less impactful and that's just merely an artifact of we're just not procuring nearly to the degree of volumes of materials that for example, the established Tier ones are. Again, that is in the near to mid-term. Now that being said, assuming that these cost pressures continue out to when we were at sales started production and vehicle started production, with our generation-one cell will have really the same exposure to those costs, because again, we're using the same nickel and cobalt cathode active materials. Now for the long term, on the R&D side of the house, we have a fairly robust activity right now around developing a non-nickel, non-cobalt cathode active material, that is essentially made up of very, very abundant and low cost materials. Now, again, it is R&D, so it need some further development. But, assuming we are successful and this is really why I personally am so excited about this, that could obviously eliminate those - that cost exposure, risk exposure, to those nickel and cobalt costs in the future. So again, we philosophically do have a long-term vision of looking to displace that nickel and cobalt containing cathode active material, again, with extremely low cost earth abundant materials, that by the way the reverse-ability of those cathode materials is unique to the solid phase. So in other words, in a traditional liquid or gel that would not be a rechargeable so. I think you were asking about, do we source some of our precursor materials? I think you were referring to specifically Eastern Asia. The short answer to that is no, we do not.

Our next question is from Gabe Daoud with Cowen. Please proceed with your question.

Afternoon, guys, and thanks for all the prepared remarks. Super helpful, and Kevin. Doug, maybe just starting with the cell stack pressure, you mentioned obviously, a cell will never have zero non-stack pressure. It's not really concerning, but could you maybe give us a sense of what an appropriate stack pressure would be and then how much would it differ, I guess, across your various OEM partners?

Yes. Well, I can't give you the expect - the exact stack pressure requirement, because that's a metric, that's not mine to give. That is proprietary to our OEM partners. It was not pulled out of somebody's back pocket. I assure you. It came about through fairly extensive effort and interfacing with primarily their module and pack teams. But as I said in the prepared remarks, what it really is, just kind of a balance, a balance between allowing for reasonable stack pressure. So we're not talking ridiculously high - sky high stack pressures, but more of a reasonable stack pressure, but one that is sufficiently low enough that any parasitic mass or volume that is required at the pack level, doesn't have - has largely negligible effect on the massive volume of the EV pack. And so, it is an area we're watching very closely. As you would expect, this is something that it would be very important to our OEM partners. And we are - we're really liking the trajectory that we're on, as we start to drive towards that path - I'm sorry, that stack level requirement.

Got you. Okay, great. And then I guess as a follow up, could you remind us where electrolyte production capacity sit today? I think maybe, entering this year you're at 2500 kilograms, but - and I guess, just on the back of the acceleration in CapEx, I guess, where does that figure go to by the end of the year?

Yes, so just to be clear, the 2500 kilograms per month, that is what we will have later this year when our - we call SP2 Solid Power 2, when that facility is fully operational. So right now, the only electrolyte production is being performed in our current facility, and that's a relatively modest, 150 kilograms per month. So once SP2 is fully operational, that's when we'll be in a position to produce the 2,500 kilograms per month. In terms of what the accelerated infrastructure investments gets us with respect to the, what I'll call, next stage of production, I can't get into specifics, but what I can say is that, these investments really do lay the foundation for what I call the next, next stage of electrolyte production. And again, we believe, in terms of schedule, it significantly helps to manage risk.

[Operator Instructions] Our next question comes from David Bell with Wolfe Research. Please proceed with your question.

Hi, Doug and everyone, congrats on the year. Just a quick question. Could you comment on the development progress that you guys have made at least over the last quarter to enable your 20 Amp Hour cells to meet at least all the same specs that the 2 Amp Hour cells are meeting? What progress has been made either on improving the material itself or the cell design?

It's all process quality improvement. So the big item, you have to realize is, that when we produce - when we do a 20 Amp Hour run, we're doing coatings not measured in meters, but in kilometers. And so as you can imagine, the level of quality that we have to meet, goes up quite a bit. And so that's really been where a significant amount of our focus over the last quarter has been on those process quality enhancements. And by the way, that touches everything from powder production to slurry production, slurry composition, and then of course, into the quality of the coated layers themselves, making sure we have as close to porosity free in the layers, very, very tight thickness tolerances, et cetera. And again, that is consistent, by and large, with our belief, which has been the majority of the performance gains are not necessarily going to come from new materials, not to say that we're not always investigating new materials, but by and large, when it comes to large format cells, it's all about process quality improvements.

Thanks, Doug. And my other one is on your earlier comments regarding the ability to increase bandwidth. So, I believe we've talked about 2500 kilograms in months. Could you walk through, is there going to be an additional acceleration beyond that at this facility? Have you thought about allocation? Is that what you mean, when you have increased bandwidth? Are you going to be able to bring on more partners when you start producing this amount of material?

Yes. So the bandwidth is more related to cell development activities, 2500 kilograms per month. I mean, that number was decided upon, because it's more than sufficient to support multiple OEMs through the next stage of cell qualification, but also reserving materials for early-stage supply contracts. Where I talk about the bandwidth constraints, it's really more on the cell design. And as I said in my opening remarks, as you would expect when you're supporting multiple auto OEMs, that for better or worse, their cell designs diverge, and it just sort of makes sense. I mean if you look at our two partners; BMW and Ford, I would say they're pretty wildly different product companies. Ford, focusing mostly on large trucks and SUVs. BMW, focusing largely on performance-based vehicles. And so, when you distill that down into the requirements, you want to get out of your cell, it diverges quite a bit. So when I talk about limited bandwidth, it's really more on the cell development activities. And that's really where these investments are going to benefit us.

Our next question comes from Vikram Bagri with Needham & Company. Please proceed with your question.

Good evening, everyone. For the first question, I wanted to understand the background behind accelerating the capital spending. Was it after looking at the results of 2 Amp Hour and 20 Amp Hour cells? And did your partners have an opinion on the acceleration of CapEx and development activity? It appears that the results were very promising as you indicated in your prepared comments and they warranted sort of accelerated development. Am I right in saying that?

Yes, I mean, I sort of teased it in my opening remarks. Look, we're now - we are now - we now have expanded scope. And so, as you would expect, our OEM partners are leaning in even more heavy. And so they would like to see nothing more than developments accelerated. So, I think it goes without saying that absolutely we have full support from our OEM and industry partners for this acceleration, because frankly, this fits their needs.

Okay. And then in terms of, you said there are couple of areas where you need to see some level of improvement and challenges. Where do you see most room for improvement in terms of performance at high charge rates, lower temperatures and so forth? Where do you see the most challenges coming from and most room for improvement?

Well, I mean, it - I guess, one of the encouraging things is that the pace of advancement in technical - in the measure technical performance, has not slowed at all. And so that's obviously very encouraging because that shows that there is still significant headroom, in terms of where we can advance performance and where we stand today is actually - our data is actually already as of today fairly impressive. But again, in the spirit of full transparency, we try to be relatively open in terms of where we still need to make specific advancements. I talked about, in particular, high charge rates, as well as doing so under low stack pressure. I'm liking the trajectory that I'm seeing. I'm very, very encouraged. Broadly, these are all related to generically reducing cell resistance, which for us typically comes through, as I stated, in the other answer to the question, typically - most typically comes through process quality improvements, really up and down the entire process. So hopefully that addresses your question. It really just comes down to addressing cell resistance that allows us to hit higher and higher charge rates and lower and lower stack pressure. Now I want to be clear, we're not talking orders of magnitude off from performance metrics. We're talking, we're already in the ballpark.

Thank you. There are no further questions at this time, I'd like to turn the floor back over to management for any closing comments.

Well, I would just like to thank all the listeners today. Hopefully, you got some value out of the update here. And so now, we've got our first earnings call under our belt and we look forward to a fairly good cadence of these kinds of updates. And so with that, we wish everyone a pleasant spring and look forward to speaking with you in the not too distant future.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.