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Stockholders’ Equity and Stock-based Compensation
 9 Months Ended
Sep. 30, 2021
Equity [Abstract]  
Stockholders’ Equity 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 September 30, 2021, the Company had 80,580,232 shares of Class A common stock issued and outstanding. There were no shares of preferred stock outstanding as of September 30, 2021.
At the Closing, the Company had 79,772,262 shares of common stock outstanding and no shares of preferred stock outstanding. This number of shares at Closing excludes 807,970 of shares which were issued for stock options that were exercised following the Merger. The following summarizes the Company’s common stock outstanding immediately after the Business Combination:
Shares%
Momentus Space, LLC unit holders50,419,505 63 %
Public stockholders13,695,257 17 %
SRAC and its affiliates4,657,500 6 %
PIPE investors11,000,000 14 %
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 million for the equity interest purchased. 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 (“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 changes in the estimated fair value of the warrant of $0.3 million and $(10.7) million for the three and nine months ended September 30, 2021, respectively, were recorded within other income (expense) in the accompanying condensed consolidated statements of operations. The change is included in other income (expense). The warrants were exercised by the lender in conjunction with the Business Combination. The loan remains outstanding as of September 30, 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 774,527 shares of Series A Preferred Stock or Preferred Stock in a subsequent round of financing. These warrants were also accounted for as a derivative liability and the changes in estimated fair value of the warrant of $0.4 million and $(1.1) million for the three and nine months ended September 30, 2021, respectively, were recorded within other income (expense) in the accompanying condensed consolidated statements of operations. The warrants were exercised by the lender in conjunction with the Business Combination.
Public and Private Warrants
As of September 30, 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 $2.0 million for the three and nine months ended September 30, 2021 was recorded within other income (expense) in the accompanying condensed consolidated statements of operations. The public warrants and the legacy outstanding private warrants were recorded as equity.
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 will be made from the Amended and Restated 2018 Plan, however, the options issued and outstanding under the plan continue to be governed by the terms of the Amended and Restated 2018 Plan.
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. Refer to our registration statement on Form S-8, filed on October 18, 2021. 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%) of the outstanding shares on the last day of the immediately preceding fiscal year and (iii) such number of Shares determined by the Board. As of September 30, 2021, no grants have been issued under the 2021 Plan.
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. Refer to our registration statement on Form S-8, filed on October 18, 2021. 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 Service (“IRS”) 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. The 2021 ESPP Plan became effective immediately following the Closing. As of September 30, 2021, no shares have been issued under the 2021 Plan.
Options and RSA Activity
The following table sets forth the summary of options and RSA activity for the nine months ended September 30, 2021. RSAs were an immaterial portion of activity for the period:
(in thousands, except per share data)Total OptionsWeighted- Average Exercise Price Per ShareWeighted- Average Remaining Contractual Term (in years)Aggregate Intrinsic Value
Outstanding as of December 31, 20207,422,996 $0.20 8.49$130,564 
Vested exercised(1,297,711)$15,263 
Forfeitures(1,820,625)
Outstanding as of September 30, 20214,304,660 $0.27 7.64$44,275 
Exercisable as of September 30, 20212,662,485 $0.26 7.28$27,526 
Vested and expected to vest as of September 30, 20214,304,660 $0.27 7.64$44,275 
Stock-based compensation expense related to options issued under the Plans was recorded as follows:
Three Months Ended September 30,Nine Months Ended September 30,
(in thousands)2021202020212020
Research and development expenses$52 $34 $186 $109 
Selling, general and administrative expenses3,023 1,339 11,001 1,533 
$3,075 $1,374 $11,187 $1,642 

The intrinsic value of options exercisable as of September 30, 2021 and 2020 was $27.5 million and $21.4 million, respectively. As of September 30, 2021, there was a total of $0.9 million in unrecognized compensation cost related to unvested options, which is expected to be recognized over a weighted-average period of 1.99 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:
Nine Months Ended
September 30,
20212020
Expected term (in years)N/A
5.03 – 6.23
Risk-free interest rateN/A
0.27% – 1.36%
Expected volatilityN/A
33.89% – 51.78%
Dividend yieldN/A0.00%
Fair value on grant dateN/A
$0.32 – $4.70
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 value of $20.91 per share. The incremental compensation related to the accelerated options totaled $5.4 million.
Income (Loss) Per Share
The following table sets forth the computation of basic and diluted net income (loss) per share:
Basic and Diluted Net Income (Loss) Per ShareThree Months Ended
September 30,		Nine Months Ended
September 30,
(in thousands, except per share data)2021202020212020
Numerator:
Net income (loss)$(5,614)$(110,923)$123,384 $(126,329)
Denominator:
Denominator for basic net income (loss) per share -weighted average shares outstanding60,589,56662,722,34059,873,19964,244,006
Dilutive options and unvested stock units outstanding——4,056,805—
Dilutive warrants outstanding——302,533—
Denominator for diluted net income (loss) per share - adjusted weighted average shares outstanding60,589,566 62,722,340 64,232,537 64,244,006 
Net income (loss) per share - diluted$(0.09)$(1.77)$1.92 $(1.97)

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 three months ended September 30, 2021 and the three and nine months ended September 30, 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. For the three months ended September 30, 2021, 24,510,729 shares were excluded and for the three and nine months ended September 30, 2020, 21,903,861 shares were excluded. For the nine months ended September 30, 2021, the Company had net income but there were 19,897,500 shares attributable to anti-dilutive warrants in the period, which were excluded.