10-Q

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	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: 001-39489

NUBURU, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	85-1288435
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
7442 S Tucson Way, Suite 130, Centennial, CO	80112
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (720) 767-1400

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	BURU	NYSE American
Redeemable warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50	BURU WS	NYSE American

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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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 Exchange Act). Yes ☐ No ☒

As of November 3, 2023, the registrant had 35,570,461 shares of common stock, $0.0001 par value per share, outstanding.

NUBURU, INC.

FORM 10-Q

TABLE OF CONTENTS


		Page
PART 1 – INTERIM FINANCIAL INFORMATION

	Cautionary note regarding forward-looking statements	3

Item 1.	Unaudited Condensed Consolidated Financial Statements	5

	Condensed Consolidated Balance Sheets	5

	Condensed Consolidated Statements of Operations and Comprehensive Loss	6

	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)	7

	Condensed Consolidated Statements of Cash Flows	9

	Notes to Condensed Consolidated Financial Statements	10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	32

Item 4.	Controls and Procedures	32

PART II – OTHER INFORMATION		33

Item 1.	Legal Proceedings	33

Item 1A.	Risk Factors	33

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	33

Item 3.	Defaults Upon Senior Securities	33

Item 4.	Mine Safety Disclosures	33

Item 5.	Other Information	33

Item 6.	Exhibits	34

SIGNATURES		35

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this "Quarterly Report") contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risk and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans, or intentions. Forward-looking statements contained in this Quarterly Report include, but are not limited to, statements about:

•

our success in retaining or recruiting, or changes required in, our officers, key employees or directors;

•

our public securities’ potential liquidity and trading;

•

the ability to maintain the listing of our common stock, par value $0.0001 par value per share (the “Common Stock”), or the 16,710,785 whole warrants of the Company sold to public investors in the IPO as part of the units (the “Public Warrants”) on a securities exchange;

•

the anticipated benefits of the Business Combination;

•

the outcome of any legal proceedings that may be instituted against us related to the Business Combination;

•

existing regulations and regulatory developments in the United States and other jurisdictions;

•

the need to hire additional personnel and our ability to attract and retain such personnel;

•

our plans and ability to obtain, maintain, enforce, or protect intellectual property rights;

•

our ability to obtain additional financing, including under that certain Purchase Agreement by and among the Company, Legacy Nuburu and Lincoln Park Capital Fund, LLC (“Lincoln Park”), dated as of August 5, 2022 (as it may be amended, supplemented or otherwise modified from time to time, the “Lincoln Park Purchase Agreement”);

•

the impact of the COVID-19 pandemic, including any mutations or variants thereof, and its effect on business and financial conditions;

•

our business, operations and financial performance, including:

•

expectations with respect to financial and business performance, including financial projections and business metrics and any underlying assumptions thereunder;

•

future business plans and growth opportunities, including revenue opportunity available from new or existing clients and expectations regarding the use of blue laser technology in 3D printing applications;

•

expectations regarding product development and pipeline;

•

expectations regarding research and development efforts;

•

expectations regarding market size;

•

expectations regarding the competitive landscape;

•

expectations regarding future acquisitions, partnerships or other relationships with third parties; and

•

future capital requirements and sources and uses of cash, including the ability to obtain additional capital in the future.

Forward-looking statements are not guarantees of performance. You should not put undue reliance on these statements, which speak only as of the date hereof. The forward-looking statements contained in this Quarterly Report are based on our current expectations and beliefs concerning future developments and their potential effects on our business. There can be no assurance that future developments affecting our business will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control), or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors under the heading "Risk Factors" in the Quarterly Report and in our Annual Report on Form 10-K for the year ended December 31, 2022 (our "Annual Report") as well as the following important factors:

•

our inability to obtain financing, including under the Lincoln Park Purchase Agreement;

•

our inability to protect our intellectual property;

•

whether the market embraces our products;

•

whether we achieve full commercialization in a timely manner;

•

the outcome of any legal proceedings that may be instituted against us;

•

our ability to meet NYSE American’s continued listing standards;

•

the inability to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition, our ability to grow and manage growth profitably, maintain relationships with customers and suppliers and retain our management and key employees;

•

our ability to retain or recruit key employees;

•

costs related to being a public company;

•

changes in applicable laws or regulations;

•

the possibility that we may be adversely affected by economic, business or competitive factors;

•

the impact of the COVID-19 pandemic, including any mutations or variants thereof, and its effect on business and financial conditions;

•

volatility in the financial sector and markets caused by geopolitical and economic factors; and

•

other risks and uncertainties set forth under the heading “Risk Factors” in Part II, Item 1A and elsewhere in this Quarterly Report and our Annual Report.

Should one or more of these risks or uncertainties materialize, or should any of the assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We do not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Frequently Used Terms

Unless otherwise stated in Item 1. Financial Statements and accompanying footnotes, or the context otherwise requires, references in this Quarterly Report to:

“Business Combination” are to the business combination of Legacy Nuburu with a subsidiary of Tailwind, with Legacy Nuburu surviving such business combination as a wholly owned subsidiary of Tailwind;

“Business Combination Agreement” are to that certain Business Combination Agreement, dated as of August 5, 2022, by and among Tailwind, Nuburu and Merger Sub, Inc., as the same has been or may be amended, modified, supplemented or waived from time to time;

“Closing” are to the consummation of the Transactions;

“Closing Date” are to January 31, 2023, the date on which the Transactions were consummated;

“Exchange Ratios” are to the quotients as defined in, and calculated in accordance with, the Business Combination Agreement, which was included as an exhibit to our Current Report on Form 8-K (File No. 001-39489) filed with the SEC on February 6, 2023;

“Legacy Nuburu” are to Nuburu Subsidiary, Inc., a Delaware corporation (f/k/a Nuburu, Inc. before the Closing Date);

“Tailwind” are to Tailwind Acquisition Corp, a Delaware corporation and our predecessor company prior to the consummation of the Transactions, which changed its name to Nuburu, Inc. following the consummation of the Transactions, and its consolidated subsidiaries;

“Tailwind IPO” are to the initial public offering by Tailwind which closed on September 9, 2020; and

“Transactions” are to the Business Combination, together with the other transactions contemplated by the Business Combination Agreement and the related agreements.

Unless the context otherwise requires, all references in this section to “Nuburu,” the “Company,” “we,” “us,” “our,” and other similar terms refer to: (i) Legacy Nuburu and its subsidiaries prior to the Closing, and (ii) Nuburu, Inc., a Delaware corporation, and its consolidated subsidiary, Nuburu Subsidiary, Inc., after the Closing.

PART 1 – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

NUBURU, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


	September 30, 2023			December 31, 2022
	(Unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	1,626,730		$	2,880,254
Accounts receivable, net		469,904			327,200
Inventories, net of allowance of $1,047,830 and $292,990, respectively		1,086,741			972,695
Deferred financing costs		65,000			4,258,515
Prepaid expenses and other current assets		579,244			46,737
Total current assets		3,827,619			8,485,401
Property and equipment, net		4,763,058			3,771,849
Construction in progress		59,672			188,912
Right-of-use assets		410,188			641,651
Other assets		34,359			34,359
TOTAL ASSETS	$	9,094,896		$	13,122,172

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities
Accounts payable	$	4,184,347		$	4,456,587
Accrued expenses		1,669,842			2,312,118
Current portion of operating lease liability		366,033			343,049
Contract liabilities		230,075			178,750
Current portion of convertible notes payable		—			7,300,000
Total current liabilities		6,450,297			14,590,504
Operating lease liability		95,409			373,907
Convertible notes payable		6,713,241			—
Warrant liabilities		334,216			—
TOTAL LIABILITIES		13,593,163			14,964,411
Commitments and Contingencies (Note 6)
Stockholders’ Equity (Deficit)
Convertible preferred stock, $0.0001 par value; 50,000,000 shares authorized; 3,038,905 and 23,237,703 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively		304			4,040
Common stock, $0.0001 par value; 250,000,000 shares authorized; 35,554,624 and 5,556,857 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively		3,555			1,077
Additional paid-in capital		72,649,712			59,344,952
Accumulated deficit		(77,151,838	)		(61,192,308	)
Total Stockholders’ Equity (Deficit)		(4,498,267	)		(1,842,239	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	9,094,896		$	13,122,172

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

NUBURU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Revenue	$	186,743		$	868,153		$	1,710,794		$	1,005,528
Cost of revenue		1,115,703			1,832,036			4,813,404			3,653,980
Gross margin		(928,960	)		(963,883	)		(3,102,610	)		(2,648,452	)
Operating expenses:
Research and development		1,348,450			1,066,161			4,300,166			2,684,694
Selling and marketing		523,627			95,670			1,066,289			603,629
General and administrative		2,335,605			1,757,104			8,409,877			4,131,477
Total operating expenses		4,207,682			2,918,935			13,776,332			7,419,800
Loss from operations		(5,136,642	)		(3,882,818	)		(16,878,942	)		(10,068,252	)
Interest income		46,998			14,875			91,914			19,178
Interest expense		(162,765	)		(55,276	)		(175,149	)		(57,490	)
Other income, net		167,108			—			1,002,647			—
Loss before provision for income taxes	$	(5,085,301	)	$	(3,923,219	)	$	(15,959,530	)	$	(10,106,564	)
Provision for income taxes		—			—			—			—
Net loss and comprehensive loss	$	(5,085,301	)	$	(3,923,219	)	$	(15,959,530	)	$	(10,106,564	)
Net loss per share, basic and diluted	$	(0.14	)	$	(0.71	)	$	(0.50	)	$	(1.86	)
Weighted-average common shares used to compute net loss per share attributable to common stockholders, basic and diluted		35,425,105			5,537,557			31,955,539			5,421,056

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

NUBURU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT)

(UNAUDITED)


	Convertible Preferred Stock						Common Stock
	Shares(1)			Amount			Shares(1)			Amount			Additional Paid-in Capital			Accumulated Deficit			Total Stockholders' Equity (Deficit)
Balance as of December 31, 2022		23,237,703		$	4,040			5,556,857		$	1,077		$	59,344,952		$	(61,192,308	)	$	(1,842,239	)
Issuance of Common Stock and Series A preferred stock upon conversion of convertible notes in connection with the reverse recapitalization		1,361,787			136			1,361,787			136			11,575,014			—			11,575,286
Conversion of Legacy Nuburu convertible preferred stock into Common Stock in connection with the reverse recapitalization		(23,237,703	)		(4,040	)		23,237,703			2,323			1,717			—			—
Issuance of Common Stock and Series A preferred stock upon the reverse recapitalization, net of issuance costs		1,481,666			148			3,233,745			(197	)		(3,257,476	)		—			(3,257,525	)
Issuance of Common Stock and Series A preferred stock to satisfy certain reverse recapitalization costs		195,452			20			195,452			20			(40	)		—			—
Recognition of Public Warrants upon the reverse recapitalization		—			—			—			—			(1,336,863	)		—			(1,336,863	)
Stock-based compensation		—			—			—			—			463,978			—			463,978
Net loss		—			—			—			—			—			(4,767,517	)		(4,767,517	)
Balance as of March 31, 2023		3,038,905		$	304			33,585,544		$	3,359		$	66,791,282		$	(65,959,825	)	$	835,120
Issuance of Common Stock from option exercises		—			—			5,153			1			6,998			—			6,999
Issuance of Common Stock from releases of restricted stock units		—			—			15,625			2			(2	)		—			—
Issuance of Common Stock from the Lincoln Park Purchase Agreement		—			—			1,681,898			167			2,099,830			—			2,099,997
Issuance of Common Stock warrants in connection with the 2023 Note and Warrant Purchase Agreement (net of issuance cost of $160,345)		—			—			—			—			2,351,414			—			2,351,414
Stock-based compensation		—			—			—			—			796,783			—			796,783
Net loss		—			—			—			—			—			(6,106,712	)		(6,106,712	)
Balance as of June 30, 2023		3,038,905		$	304			35,288,220		$	3,529		$	72,046,305		$	(72,066,537	)	$	(16,399	)
Issuance of Common Stock from releases of restricted stock units		—			—			326,579			32			(32	)		—			—
Restricted stock units used for tax withholdings		—			—			(60,175	)		(6	)		(31,589	)		—			(31,595	)
Stock-based compensation		—			—			—			—			635,028			—			635,028
Net loss		—			—			—			—			—			(5,085,301	)		(5,085,301	)
Balance as of September 30, 2023		3,038,905		$	304			35,554,624		$	3,555		$	72,649,712		$	(77,151,838	)	$	(4,498,267	)


	Convertible Preferred Stock				Common Stock
	Shares(1)		Amount		Shares(1)		Amount		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders' Equity (Deficit)
Balance as of December 31, 2021		23,196,296	$	4,036		5,153,286	$	999	$	56,646,247	$	(47,063,207	)	$	9,588,075
Issuance of Legacy Nuburu Series C preferred stock		41,407		4		—		—		188,886		—			188,890
Issuance of Legacy Nuburu common stock from option exercises		—		—		370,395		72		107,788		—			107,860
Stock-based compensation		—		—		—		—		69,455		—			69,455
Net loss		—		—		—		—		—		(2,287,794	)		(2,287,794	)
Balance as of March 31, 2022		23,237,703	$	4,040		5,523,681	$	1,071	$	57,012,376	$	(49,351,001	)	$	7,666,486
Issuance of Legacy Nuburu common stock from option exercises		—		—		1,396		—		6,066		—			6,066
Stock-based compensation		—		—		—		—		1,197,233		—			1,197,233
Net loss		—		—		—		—		—		(3,895,551	)		(3,895,551	)
Balance as of June 30, 2022		23,237,703	$	4,040		5,525,077	$	1,071	$	58,215,675	$	(53,246,552	)	$	4,974,234
Issuance of Legacy Nuburu common stock from option exercises		—		—		25,770		5		7,495		—			7,500
Stock-based compensation		—		—		—		—		600,160		—			600,160
Net loss		—		—		—		—		—		(3,923,219	)		(3,923,219	)
Balance as of September 30, 2022		23,237,703	$	4,040		5,550,847	$	1,076	$	58,823,330	$	(57,169,771	)	$	1,658,675

(1) The number of shares of convertible preferred stock and common stock issued and outstanding prior to the Business Combination have been retroactively adjusted by the Exchange Ratio to give effect to the reverse recapitalization treatment of the Business Combination. See Note 1 - Description of Business and Note 3 - Reverse Capitalization for more information.

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

NUBURU, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


	Nine Months Ended September 30,
	2023			2022
Cash Flows from Operating Activities:
Net loss	$	(15,959,530	)	$	(10,106,564	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		369,971			380,539
Stock-based compensation		1,895,789			1,866,848
Change in fair value of warrant liabilities		(1,002,647	)		—
Excess and obsolete inventory reserve adjustments		868,002			269,893
Inventory lower of cost and net realizable value adjustments		(113,162	)		(548,190	)
Changes in operating assets and liabilities:
Accounts receivable		(142,704	)		(520,450	)
Inventories		(957,916	)		(381,503	)
Prepaid expenses and other current assets		(492,507	)		(13,181	)
Operating lease right-of-use asset		231,463			218,076
Accounts payable		2,695,273			1,107,378
Accrued expenses		(447,024	)		587,103</

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company