Solid Power, Inc. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures In designing and evaluating our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired controls. As required by Rule 13a-15(b) under the Exchange Act, our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2021. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this Report, our disclosure controls and procedures were effective. Management’s Report on Internal Control Over Financial Reporting This Report does not include a report of management’s assessment regarding our internal control over financial reporting or an attestation report of the company’s registered public accounting firm due to a transition period established by rules of the SEC for newly public companies. Additionally, our independent registered public accounting firm will not be required to opine on the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act until we are no longer an “emerging growth company,” as defined in the JOBS Act. We previously identified two material weaknesses for DCRC and Legacy Solid Power due to deficiencies identified in the operating effectiveness of controls over financial reporting related to (1) failure to correctly apply the nuances of the complex accounting standards that apply to our financial statements, including with respect to certain complex equity instruments and equity linked instruments and related earnings per share impacts, and (2) the review of complex transactions for proper accounting treatment as our control environment would have failed to detect the misstatement prior to the financial statement issuance. However, we have determined that we have remediated the material weakness for DCRC related to a failure to correctly apply the nuances of the complex accounting standards that apply to our financial statements, including with respect to certain complex equity instruments and equity linked instruments and related earnings per share impacts as of December 31, 2021. The second material weakness for Legacy Solid Power, which relates to the review of complex transactions for proper accounting treatment, remains unremediated because our control environment would have failed to detect the misstatement prior to the issuance of financial statements. Changes in Internal Control over Financial Reporting Other than the actions taken as described in Management’s Remediation Initiatives below to improve the Company’s internal control over financial reporting, there have been no changes in our internal control over financial reporting during the most recent fiscal quarter that materially affected, or which are reasonably likely to materially affect, our internal control over financial reporting. Management’s Remediation Initiatives We have taken the following steps to remediate the identified material weakness and to enhance our internal controls: · Hiring additional personnel. · Improving our capabilities to identify, research, and prepare support documentation for technical accounting issues. · Designing and implementing a formalized internal control framework. Solid Power, Inc. | 2021 Form 10-K | 81 Table of Contents · Continuing efforts to improve and strengthen our control processes and procedures. · Working with our auditors and other outside advisors to ensure that our controls and procedures are adequate and effective. We will continue to improve our internal controls over 2022 as we test the controls around the material weakness. We expect to remediate the material weakness by December 31, 2022. However, we cannot make any assurances that we will successfully remediate the material weakness within our anticipated timeframe. See the section titled “ Risk Factors—Risks Related to Finance and Accounting—Our auditors identified a material weakness in our internal control over financial reporting as of December 31, 2021. If we are unable to develop and maintain an effective system of internal controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act, we may not be able to accurately report our financial results in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our stock price, business and operating results .” ​ Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. PART III Item 10. Directors, Executive Officers and Corporate Governance The information regarding executive officers called for by Item 401(b) of Regulation S-K may be found under the caption “Information About our Executive Officers” in this Report. The other information required by this Item is included in the Company’s 2022 Proxy Statement to be filed with the SEC within 120 days after December 31, 2021 in connection with the solicitation of proxies for the Company’s 2022 annual meeting of stockholders, and is incorporated herein by reference. ​ Item 11. Executive Compensation. The information required by this Item is included in the Company’s 2022 Proxy Statement to be filed with the SEC within 120 days after December 31, 2021, and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The information required by this Item is included in the Company’s 2022 Proxy Statement to be filed with the SEC within 120 days after December 31, 2021, and is incorporated herein by reference. ​ Item 13. Certain Relationships and Related Transactions, and Director Independence. The information required by this Item is included in the Company’s 2022 Proxy Statement to be filed with the SEC within 120 days after December 31, 2021, and is incorporated herein by reference. Item 14. Principal Accountant Fees and Services. The information required by this Item is included in the Company’s 2022 Proxy Statement to be filed with the SEC within 120 days after December 31, 2021, and is incorporated herein by reference. Solid Power, Inc. | 2021 Form 10-K | 82 Table of Contents PART IV Item 15. Exhibits, Financial Statement Schedules (a) Financial Statements, Financial Statement Schedules and Exhibits (1) Financial Statements. Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Mezzanine and Stockholders’ Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements (2) Financial Statement Schedules: None (3) Exhibits ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Incorporated by Reference Exhibit Number ​ Description ​ Schedule Form ​ File Number ​ Exhibit/Annex ​ Filing Date 2.1 ​ Business Combination Agreement and Plan of Reorganization, dated as of June 15, 2021, by and among the Company, Merger Sub and Legacy Solid Power ​ 424B3 ​ 333-258681 ​ Annex A ​ November 10, 2021 2.2 ​ First Amendment to the Business Combination Agreement, dated October 12, 2021, by and among the Company, Merger Sub and Legacy Solid Power ​ 424B3 ​ 333-258681 ​ Annex A-1 ​ November 10, 2021 3.1 ​ Second Amended and Restated Certificate of Incorporation ​ 8-K ​ 001-40284 ​ 3.1 ​ December 13, 2021 3.2 ​ Amended and Restated Bylaws ​ 8-K ​ 001-40284 ​ 3.2 ​ December 13, 2021 4.1 ​ Specimen Common Stock Certificate ​ 8-K ​ 001-40284 ​ 4.1 ​ December 13, 2021 4.2 ​ Specimen Warrant Certificate ​ 8-K ​ 001-40284 ​ 4.2 ​ December 13, 2021 4.3 ​ Warrant Agreement, dated March 23, 2021, between the Company and Continental Stock Transfer & Trust Company ​ 8-K ​ 001-40284 ​ 4.1 ​ March 26, 2021 Solid Power, Inc. | 2021 Form 10-K | 83 Table of Contents 4.4 ​ Amended and Restated Registration Rights Agreement ​ 8-K ​ 001-40284 ​ 10.2 ​ December 13, 2021 4.5± ​ Board Nomination and Support Agreement between Solid Power, BMW Holding B.V. and the stockholders of Solid Power listed on Schedule A thereto, dated May 5, 2021 ​ S-4 ​ 333-258681 ​ 4.4 ​ August 10, 2021 4.6* ​ Description of Securities ​ ​ ​ ​ ​ ​ ​ ​ 10.1 ​ Private Placement Warrants Purchase Agreement, dated March 23, 2021, between DCRC, the Sponsor and the other purchasers named therein ​ 8-K ​ 001-40284 ​ 10.5 ​ March 26, 2021 10.2# ​ Solid Power, Inc. 2021 Equity Incentive Plan ​ 8-K ​ 001-40284 ​ 10.7 ​ December 13, 2021 10.3# ​ Solid Power, Inc. 2021 Employee Stock Purchase Plan ​ S-8 ​ 333-262714 ​ 99.3 ​ February 14, 2022 10.4# ​ Solid Power, Inc. 2014 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.1 ​ February 14, 2022 10.5# ​ Form of Stock Option Grant Notice under 2014 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.4 ​ February 14, 2022 10.6# ​ Form of Notice of Stock Option Grant under 2021 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.5 ​ February 14, 2022 10.7# ​ Form of Notice of Restricted Stock Unit Grant (Employee) under 2021 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.6 ​ February 14, 2022 10.8# ​ Form of Notice of Restricted Stock Unit Grant (New Director) under 2021 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.7 ​ February 14, 2022 10.9# ​ Form of Notice of Restricted Stock Unit Grant (Annual Award) under 2021 Equity Incentive Plan ​ S-8 ​ 333-262714 ​ 99.8 ​ February 14, 2022 10.10± ​ Joint Development Agreement, dated July 1, 2017, by and among Legacy Solid Power and BMW of North America, LLC ​ S-4/A ​ 333-258681 ​ 10.11 ​ October 13, 2021 10.11± ​ Amendment No. 1 to Joint Development Agreement, dated February 18, 2021, between Legacy Solid Power and BMW of North America, LLC ​ S-4/A ​ 333-258681 ​ 10.12 ​ October 13, 2021 10.12± ​ Amendment No. 2 to Joint Development Agreement, dated March 22, 2021, between Legacy Solid Power and BMW of North America, LLC ​ S-4/A ​ 333-258681 ​ 10.13 ​ October 13, 2021 10.13± ​ Amendment No. 3 to Joint Development Agreement, dated November 1, 2021, between Legacy Solid Power and BMW of North America, LLC ​ 8-K ​ 001-40284 ​ 10.15 ​ December 13, 2021 Solid Power, Inc. | 2021 Form 10-K | 84 Table of Contents 10.14± ​ Agreement for the Joint Development of Solid State Batteries for Automotive Applications between Ford Motor Company and Legacy Solid Power, dated December 28, 2018 ​ S-4/A ​ 333-258681 ​ 10.14 ​ October 13, 2021 10.15± ​ Series B Preferred Stock Financing Letter Agreement between the Ford Motor Company and Legacy Solid Power, dated May 5, 2021 ​ S-4/A ​ 333-258681 ​ 10.15 ​ October 13, 2021 10.16± ​ Joint Development Agreement, dated October 28, 2021, between Legacy Solid Power and SK Innovation Co., Ltd. ​ S-4/A ​ 333-258681 ​ 10.16 ​ November 2, 2021 10.17 ​ Solid Power, Inc. Outside Director Compensation Policy ​ 8-K ​ 001-40284 ​ 10.9 ​ December 13, 2021 10.18# ​ Solid Power, Inc. Executive Incentive Compensation Plan ​ 8-K ​ 001-40284 ​ 10.10 ​ December 13, 2021 10.19# ​ Solid Power, Inc. Executive Change in Control and Severance Plan ​ 8-K ​ 001-40284 ​ 10.11 ​ December 13, 2021 10.20# ​ Solid Power, Inc. Form of Indemnification Agreement ​ 8-K ​ 001-40284 ​ 10.1 ​ December 13, 2021 10.21# ​ Letter Agreement with Douglas Campbell, dated August 5, 2021 ​ 8-K ​ 001-40284 ​ 10.3 ​ December 13, 2021 10.22# ​ Letter Agreement with David Jansen, dated August 5, 2021 ​ 8-K ​ 001-40284 ​ 10.4 ​ December 13, 2021 10.23# ​ Letter Agreement with Derek Johnson, dated August 5, 2021 ​ 8-K ​ 001-40284 ​ 10.5 ​ December 13, 2021 10.24*±# ​ Offer Letter with Jon Jacobs, dated September 26, 2021 ​ ​ ​ ​ ​ ​ ​ ​ 10.25*# ​ Executive Change in Control and Severance Plan Participation Agreement with Jon Jacobs, dated December 21, 2021 ​ ​ ​ ​ ​ ​ ​ ​ 10.26 ​ Lease Agreement between the Company and Red Pierce, LLC, dated November 29, 2016 ​ 8-K ​ 001-40284 ​ 10.19 ​ December 13, 2021 10.27 ​ Amendment to Lease Agreement between the Company and Red Pierce, LLC, dated December 5, 2017 ​ 8-K ​ 001-40284 ​ 10.20 ​ December 13, 2021 10.28 ​ Industrial Lease Agreement between the Company and 25 North Investors SPE1, LLC, dated September 1, 2021 ​ 8-K ​ 001-40284 ​ 10.21 ​ December 13, 2021 21 ​ List of Subsidiaries ​ S-1 ​ 333-261711 ​ 21 ​ December 17, 2021 Solid Power, Inc. | 2021 Form 10-K | 85 Table of Contents 23.1* ​ Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm ​ ​ ​ ​ ​ ​ ​ ​ 24.1* ​ Power of Attorney (included on the signature page of this Annual Report on Form 10-K) ​ ​ ​ ​ ​ ​ ​ ​ 31.1* ​ Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 ​ ​ ​ ​ ​ ​ ​ ​ 31.2* ​ Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 ​ ​ ​ ​ ​ ​ ​ ​ 32.1** ​ Section 1350 Certification ​ ​ ​ ​ ​ ​ ​ ​ 32.2** ​ Section 1350 Certification ​ ​ ​ ​ ​ ​ ​ ​ 101.INS* ​ XBRL Instance Document – the instance document does not appear in the Interactive Data file because its Inline XBRL tags are embedded within the Inline XBRL document ​ ​ ​ ​ ​ ​ ​ ​ 101.SCH* ​ Inline XBRL Taxonomy Extension Schema Document ​ ​ ​ ​ ​ ​ ​ ​ 101.CAL* ​ Inline XBRL Taxonomy Extension Calculation Linkbase ​ ​ ​ ​ ​ ​ ​ ​ 101.DEF* ​ Inline XBRL Taxonomy Extension Definition Document ​ ​ ​ ​ ​ ​ ​ ​ 101.LAB* ​ Inline XBRL Taxonomy Extension Label Linkbase Document ​ ​ ​ ​ ​ ​ ​ ​ 101.PRE* ​ Inline XBRL Taxonomy Extension Presentation Linkbase ​ ​ ​ ​ ​ ​ ​ ​ 104* ​ Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) ​ ​ ​ ​ ​ ​ ​ ​ * Filed herewith. ** Furnished herewith. ± Certain portions of this exhibit have been omitted in accordance with Regulation S-K Item 601. The Company agrees to furnish an unredacted copy of the exhibit to the SEC upon request. # Indicates a management or compensatory plan. Item 16. Form 10-K Summary None. ​ Solid Power, Inc. | 2021 Form 10-K | 86 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: March 23, 2022 ​ ​ ​ ​ SOLID POWER, INC. ​ ​ ​ ​ ​ By: /s/ Kevin Paprzycki ​ ​ Name: Kevin Paprzycki ​ ​ Title: Chief Financial Officer and Treasurer ​ ​ ​ Solid Power, Inc. | 2021 Form 10-K | 87 Table of Contents POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Douglas Campbell, David Jansen, Kevin Paprzycki and James Liebscher, and each of them, as his or her true and lawful attorney-in-fact and agent with full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact, proxy and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact, proxy and agent, or his or her substitute, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated: ​ Name Title Date ​ ​ Chief Executive Officer and Director (Principal Executive Officer) ​ ​ /s/ Douglas Campbell ​ ​ March 23, 2022 Douglas Campbell ​ ​ ​ ​ ​ ​ Chief Financial Officer and Treasurer ​ ​ /s/ Kevin Paprzycki ​ (Principal Financial and Accounting Officer) ​ March 23, 2022 Kevin Paprzycki ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ David Jansen ​ President and Director ​ March 23, 2022 David Jansen ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Erik Anderson ​ Director ​ March 23, 2022 Erik Anderson ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Rainer Feurer ​ Director ​ March 23, 2022 Rainer Feurer ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Steven H. Goldberg ​ Director ​ March 23, 2022 Steven H. Goldberg ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Aleksandra Miziolek ​ Director ​ March 23, 2022 Aleksandra Miziolek ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Lesa Roe ​ Director ​ March 23, 2022 Lesa Roe ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ John Stephens ​ Director ​ March 23, 2022 John Stephens ​ ​ ​ ​ ​ ​ ​ ​ ​ /s/ Robert Tichio ​ Director ​ March 23, 2022 Robert Tichio ​ ​ ​ ​ ​ Solid Power, Inc. | 2021 Form 10-K | 88