Electriq Power

424B3 1 electriqpower-424b3.htm 424B3 Electriq Power - 424b3

Filed Pursuant to Rule 424(b)(3) and Rule 424(c)

Registration Statement No. 333-274657

January 12, 2024

PROSPECTUS SUPPLEMENT NO. 3

Electriq Power Holdings, Inc.

46,888,151 Shares of Class A Common Stock

3,000,000 Warrants

17,920,737 Shares of Class A Common Stock Issuable Upon Election of Series A Preferred Stock Holders

16,333,333 Shares of Class A Common Stock Issuable Upon Exercise of Warrants

This prospectus supplement amends the prospectus dated November 13, 2023, as supplemented on November 15, 2023 and December 20, 2023 (the “Prospectus”) of Electriq Power Holdings, Inc., a Delaware corporation (the “Company”), that relates to shares of the Company’s common stock, warrants, common stock issuable upon election of Series A Preferred Stock Holders and common stock issuable upon exercise of warrants, as more fully described in the Prospectus.

This prospectus supplement is being filed to include the information set forth in our quarterly report on Form 10-Q/A for the fiscal quarter ended September 30, 2023, filed with the Securities and Exchange Commission (the “SEC”) on January 12, 2024, which is set forth below. This prospectus supplement should be read in conjunction with the Prospectus, which is to be delivered with this prospectus supplement.

The shares of common stock of the Company are listed on the New York Stock Exchange (the “NYSE”) under the ticker symbol “ELIQ.” The closing sale price on the NYSE for the shares of common stock on January 11, 2024 was $0.28 per share.

Investing in the Company’s common stock involves risks. See “Risk Factors” beginning on page 8 of the Prospectus and under similar headings in any amendments or supplements to the Prospectus.

Neither the SEC nor any other regulatory body has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this Prospectus Supplement No. 3 is January 12, 2024.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________

FORM 10-Q/A

(Amendment No.1)

___________________________

(Mark One)


X			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-39948

___________________________

ELECTRIQ POWER HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

___________________________


Delaware		85-3310839
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

625 North Flagler Drive,	Suite 1003B
West Palm Beach,	FL	33401
(Address of Principal Executive Offices)		(Zip Code)

___________________________

(833) 462-2883

Registrant's telephone number, including area code

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	ELIQ	New York Stock Exchange
Warrants, each exercisable for one share of Class A common stock at an exercise price of $6.57 per share	ELIQ WS

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 ☐

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 ☒ No ☐

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):


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	x	Smaller reporting company	x
		Emerging growth company	x

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

There were 41,754,345 shares of common stock outstanding as of November 10, 2023.

EXPLANATORY NOTE

This Amendment No. 1 to Quarterly Report on Form 10-Q/A (the “Amended Report”) filed by Electriq Power Holdings, Inc. (the “Company”) amends and restates certain information included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2023, filed with the Securities and Exchange Commission (the “SEC”) on November 14, 2023 (the “Original Report”).

As described in the Company's Current Report on Form 8-K filed with the SEC on December 19, 2023, on December 15, 2023, the Audit Committee of the Board of Directors of the Company (the “Audit Committee”), after considering the recommendations of management, concluded that the Company’s previously issued consolidated financial statements as of and for the quarter ended September 30, 2023 (the “Financial Statements”), included in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, should no longer be relied upon. Similarly, any other previously filed or furnished reports, related earnings releases, guidance, investor presentations, or similar communications of the Company describing the Financial Statements should no longer be relied upon.

The determination relates to the Company’s interpretation of the accounting guidance applicable to the Forward Purchase Agreement (“FPA”), which was generally consistent with the accounting application of some other SPACs that had entered into similar arrangements. The Company determined that: (i) the amount prepaid to Meteora under the Forward Purchase Agreement previously recorded as net current assets should be restated by reclassifying the prepayment amount to equity, and (ii) the recording of a liability, which represents the value of the derivative liability as of September 30, 2023 associated with the Forward Purchase Agreement including the in-substance written put option, the maturity consideration and the share consideration, and should be reflected as a current liability in the Company’s condensed consolidated balance sheet as of September 30, 2023. The net difference was previously recorded as a forward purchase contract asset within total current assets in the Company’s condensed consolidated balance sheet and will be reversed as part of the restatement to be recognized as of September 30, 2023.

The Company is filing this Amended Report for the purpose of revising the accounting treatment of the FPA in its financial statements as of September 30, 2023, to reclassify the prepayment amount, previously reflected as a forward purchase contract asset and recorded net of the associated forward purchase contract derivative liability and included in total current assets in the condensed consolidated balance sheet, to the equity section of the condensed consolidated balance sheet with any remaining balance of the FPA, including the in-substance written put option, maturity consideration and the share consideration, classified as forward purchase contract derivative liabilities included in total current liabilities in the condensed consolidated balance sheet in its financial statements as of September 30, 2023, included in this Form 10-Q/A.

In connection with the determinations described above, management of the Company has concluded that a material weakness in the Company’s internal control over financial reporting existed as of September 30, 2023 and that the Company’s disclosure controls and procedures were not effective as of September 30, 2023. See additional discussion included in Part I – Item 4, “Controls and Procedures” of this Amended Report.

Items Amended in this Amended Report

For the convenience of the reader, this Form 10-Q/A sets forth the information in the original Form 10-Q filing in its entirety; however, only the following sections of the original Form 10-Q filing are revised in this Form 10-Q/A, solely as a result of and to reflect the restatement and conditions related to the restatement described above.

Part I, Item 1 Financial Statements and Notes to Consolidated Financial Statements

Notes:

Note 1 - Organization and Description of Business

Note 2 - Summary of Significant Accounting Policies

Note 12 – Fair Value

Note 14 – Subsequent Events

Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 4 Control and Procedures

Part II, Item 1A Risk Factors

The risk factors included in Part II - Item 1A, “Risk Factors” herein have been amended to add a new risk factor regarding the Company's restatement and the Company's ability to obtain additional capital and amend the existing risk factor regarding compliance with the continued listing standards of the NYSE.

Pursuant to the rules of the SEC, Part II, Item 6 of the original Form 10-Q filing has been amended to include currently dated certifications from the Company's chief executive officer and chief financial officer, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002.

Except as it relates to the restatement described above with related disclosures, this Amended Report does not reflect events occurring after the date of the original Form 10-Q filing.

Table of Contents


			Page
Part I - Financial Information			1
Item 1. Financial Statements			1
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			47
Item 3. Quantitative and Qualitative Disclosures About Market Risk			62
Item 4. Controls and Procedures			62
Part II - Other Information			65
Item 1. Legal Proceedings			65
Item 1A. Risk Factors			65
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			109
Item 3. Defaults Upon Senior Securities			110
Item 4. Mine Safety Disclosures			110
Item 5. Other Information			110
Item 6. Exhibits			111
Signatures			114

Part I - Financial Information

Item 1. Financial Statements

ELECTRIQ POWER HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS


	September 30,		December 31,
	2023		2022
	(as Restated)
Assets	(Unaudited)
Current assets:
Cash	$	8,099,738	$	5,480,960
Accounts receivable, less allowance for doubtful accounts of $40,449 and $30,429 as of September 30, 2023 and December 31, 2022, respectively	371,923		317,423
Inventory, net	20,929,486		13,532,475
Inventory deposits	238,068		5,182,045

Prepaid expenses and other current assets	752,391		368,117
Total current assets	30,391,606		24,881,020
Property and equipment, net	1,730,670		1,422,293
Right of use assets	3,346,958		3,241,705
Deposits	131,257		109,539
Total assets	$	35,600,491	$	29,654,557
Liabilities, mezzanine equity and stockholders’ deficit
Current liabilities:
Current portion of loan payable	$	—	$	11,377,297
SAFE notes	—		51,600,000
Accounts payable	8,201,251		1,377,123
Warrants liability	—		14,114,411
Accrued payroll and employee benefits	2,233,598		629,773
Lease liability	718,027		347,131
Forward purchase contract derivative liability	34,970,682		—
Accrued expenses and other current liabilities	2,294,996		5,196,432
Total current liabilities	48,418,554		84,642,167

Derivative warrants liability	3,039,603		—
Convertible note payable	—		5,000,000
Cumulative mandatorily redeemable preferred stock liability	21,465,335		—
Other long-term liabilities	2,605,293		2,503,038
Total liabilities	75,528,785		92,145,205
Commitments and contingencies (Note 7)
Mezzanine equity:

Common stock; $0.0001 par value; 3,734,062 and zero shares contingently redeemable, respectively at September 30, 2023 and December 31, 2022	39,523,511		—
Stockholders’ deficit:
Common stock; $0.0001 par value; 38,020,283 and 21,373,035 shares issued and outstanding, respectively at September 30, 2023 and December 31, 2022	3,802		2,137
Additional paid-in capital	39,002,908		42,500,908
Accumulated deficit	(118,458,233)		(104,993,411)

Accumulated other comprehensive loss	(282)		(282)
Total stockholders’ deficit	(79,451,805)		(62,490,648)
Total liabilities, mezzanine equity and stockholders’ deficit	$	35,600,491	$	29,654,557

See accompanying notes to Condensed Consolidated Financial Statements.

ELECTRIQ POWER HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net revenues	$	834,262	$	5,988,248	$	1,019,207	$	15,334,583
Cost of goods sold	853,615		5,621,589		1,921,367		13,957,964
Gross (loss) profit	(19,353)		366,659		(902,160)		1,376,619
Operating expenses:
Research and development	1,011,633		901,058		3,147,943		2,716,351
Sales and marketing	1,308,928		909,871		3,522,731		2,790,657
General and administrative	4,806,693		2,626,179		14,235,262		6,975,600
Total operating expenses	7,127,254		4,437,108		20,905,936		12,482,608
Loss from operations	(7,146,607)		(4,070,449)		(21,808,096)		(11,105,989)
Other expense (income):
Interest expense	1,291,851		918,035		3,292,932		1,223,254
Unrealized fair value adjustments	14,895,081		5,170,186		(10,891,144)		32,128,614
Other (income) expense, net	(3,380,090)		4,428		(745,062)		5,864
Loss before income taxes	(19,953,449)		(10,163,098)		(13,464,822)		(44,463,721)
Income tax expense	—		—		—		—
Net loss	(19,953,449)		(10,163,098)		(13,464,822)		(44,463,721)
Cumulative preferred stock dividends	45,803		451,895		978,752		1,283,334
Net loss attributable to common stockholders	$	(19,999,252)	$	(10,614,993)	$	(14,443,574)	$	(45,747,055)
Net loss per share attributable to common stockholders—basic and diluted	$	(0.74)	$	(6.65)	$	(1.40)	$	(29.57)

Weighted average number of shares of common stock outstanding—basic and diluted	26,944,552		1,595,724		10,290,182		1,546,928

See accompanying notes to Condensed Consolidated Financial Statements.

ELECTRIQ POWER HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN MEZZANINE EQUITY

(unaudited)


	Common			Pre-2023 Seed, Seed-1 and Seed-2 Preferred			Additional Paid- in Capital	Total Mezzanine Equity
	Shares	Par		Shares	Par





Balance at December 31, 2021	—	$	—	2,099,942,360	$	2,099,942			$	22,066,270	$	24,166,212
Retroactive conversion of shares due to Business Combination	—	—		(2,099,942,360)	(2,099,942)				(22,066,270)		(24,166,212)
Balance at December 31, 2021, March 31, 2022, June 30, 2022, September 30, 2022, December 31, 2022, March 31, 2023 and June 30, 2023, as converted	—	—		—	—				—		—
Contingently redeemable shares of common stock purchased pursuant to Forward Purchase Agreement	3,534,492	353		—	—				37,559,813		37,560,166
Shares sold under Forward Purchase Agreement and reclassified to permanent equity	(51,624)	(5)		—	—				(548,590)		(548,595)
Contingently redeemable shares of common stock issued pursuant to terms of FPA Funding Amount PIPE Subscription Agreement	251,194	25		—	—				2,511,915		2,511,940
Balance at September 30, 2023	3,734,062	$	373	—	$	—			$	39,523,138	$	39,523,511

See accompanying notes to Condensed Consolidated Financial Statements.

ELECTRIQ POWER HOLDINGS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ DEFICIT

(unaudited)


	Common			Additional Paid- in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders’ Deficit
	Shares	Par





Balance at December 31, 2022	242,302,003	$	24,230	$	7,686,612	$	(104,993,411)	$	(282)	$	(97,282,851)
Retroactive conversion of shares due to Business Combination	(220,928,968)	(22,093)		34,814,296		—		—		34,792,203
Balance at December 31, 2022, as converted	21,373,035	2,137		42,500,908		(104,993,411)		(282)		(62,490,648)
Issuance of shares for common stock	12,273	1		26,339		—		—		26,340
Stock-based compensation	—	—		1,515,816		—		—		1,515,816
Net loss	—	—		—		(10,032,916)		—		(10,032,916)
Balance at March 31, 2023	21,385,308	$	2,138	$	44,043,063	$	(115,026,327)	$	(282)	$	(70,981,408)

SEC Form 424B3 filed by TLG Acquisition One Corp.