Dragonfly Energy Holdings Corp · NASDAQ:DFLI
Dragonfly Energy — SPAC Merger (May 2022)
47 slides from Dragonfly Energy's SPAC merger presentation, May 16, 2022
Slide 1: Creating a New Standard For Energy Storage
CONFIDENTIAL | 1 Creating a New Standard For Energy Storage
Slide 2: Legal Disclaimer
CONFIDENTIAL | 2 Legal Disclaimer This investor presentation (this “Presentation”) has been prepared for use by Dragonfly Energy Corp. (“Dragonfly” or the “Company”) and Chardan NexTech Acquisition 2 Corp. (“CNTQ”) in connection with their proposed business combination. This Presentation is for info
Slide 3: Legal Disclaimer (Cont'd)
CONFIDENTIAL | 3 Disclaimer (2/6) Legal Disclaimer (Cont’d) You should not construe the contents of this Presentation as legal, regulatory, tax, accounting or investment advice or a recommendation. We recommend that you seek independent third party legal, regulatory, accounting and tax advice regard
Slide 4: Forward-Looking Statements
CONFIDENTIAL | 4 Forward-Looking Statements This Presentation contains certain “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Se
Slide 5: Use of Projections
CONFIDENTIAL | 5 Use of Projections This Presentation may contain financial forecasts of Dragonfly. Neither Dragonfly’s independent auditors, nor the independent registered public accounting firm of CNTQ, audited, reviewed, compiled or performed any procedures with respect to the projections for the
Slide 6: Trademarks
CONFIDENTIAL | 6 Trademarks Dragonfly and CNTQ own or have rights to various trademarks, service marks and trade names that they use in connection with the operation of their respective businesses. This Presentation may also contain trademarks, service marks, trade names and copyrights of other comp
Slide 7: Participants in the Solicitation
CONFIDENTIAL | 7 Participants in the Solicitation The Company, CNTQ and certain of their respective directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be participants in the solicitation of proxies from CNTQ’s shareholders in connection wit
Slide 8: Experienced Executive Team
CONFIDENTIAL | 8 Experienced Executive Team Jonas Grossman CEO and Director Ventoux CCM Acquisition Corp Alex Weil CFO and Director Ventoux CCM Acquisition Corp Kerry Propper Executive Chairman Jon Biele Perry Boyle Roderick Hardamon Jory Des Jardins Hitesh Thakrar Todd Thomson Results Driven Board
Slide 9: Chardan NexTech 2 Overview
CONFIDENTIAL | 9 ▪ Chardan NexTech Acquisition 2 Corp. (NASDAQ: CNTQ) is a $127 million SPAC focused on merging with a disruptive technology company ▪ Executives are comprised of founding partners and executives of Chardan ▪ ~80 years of combined expertise, including public offering and transaction
Slide 10: Summary Transaction Terms
CONFIDENTIAL | 10 Pro Forma Valuation at Close $MM Share Price $10.00 Pro Forma Shares Outstanding (MM) 55.8 Pro Forma Equity Value $558.0 Less: Pro Forma Net Cash ($57.9) Dragonfly Enterprise Value $500.1 Estimated Sources $MM Dragonfly Shareholder Equity Rollover $400.0 CNTQ Cash in Trust $128.4 S
Slide 11: Investment Thesis
CONFIDENTIAL | 11 Investment Thesis ESG Investment Large Addressable Market Profitable Growth Attractive Valuation Solid State Upside Strong Leadership Integrated lithium-ion technology company delivering environmentally impactful solutions for energy storage Current and identified adjacent market r
Slide 12: Our Team
CONFIDENTIAL | 12 Dr. Denis Phares Co-Founder and CEO Sean Nichols Co-Founder and COO John Marchetti CFO Nicole Harvey General Counsel Wade Seaburg Director – Outside Sales and Business Development Our Team Dr. Vick Singh Senior R&D Scientist Ryan Hopkins Director – Production and Automation
Slide 13: Revolutionizing smart energy storage to enable a clean, renewable future
CONFIDENTIAL | 13 Revolutionizing smart energy storage to enable a clean, renewable future CONFIDENTIAL | 13
Slide 14: Dragonfly's Industry Leading Business
CONFIDENTIAL | 14 Source: Dragonfly Energy. (1) As of Q1 2022. (2) Profitability defined as positive Adjusted EBITDA. (3) DTC denotes Direct to Consumer. (4) OEM denotes Original Equipment Manufacturer. (5) Based on Company’s estimated manufacturing capacity after planned expansion. ▪ Incorporated i
Slide 15: Our Batteries Get Out There, Stay Out There
CONFIDENTIAL | 15 ✓Environmentally safe ✓Efficient and reliable ✓Innovative technology ✓Unmatched brand recognition ✓Exceptional customer experience ✓Designed and assembled in the U.S. Source: Dragonfly Energy. Our Batteries Get Out There, Stay Out There Dragonfly is a full system integrator offerin
Slide 16: Positioned to Sit at the Nexus of Energy Technology
CONFIDENTIAL | 16 Source: Dragonfly Energy. Dragonfly is Positioned to Sit at the Nexus of Energy Technology solid state Li-ion Cells Conventional Li-ion Battery Manufacturers Technology-Focused Energy Storage Vertically Integrated Energy Solid State Li-ion Cells
Slide 17: Rapidly Entering into New Addressable Markets
CONFIDENTIAL | 17 Source: Management Estimates, Frost & Sullivan, NMMA, RVIA, Grandview Research, Statista, Research Nester, Associated Press, Generac, CTIA, International Construction, U.S. Energy Information Administration, U.S. Census Bureau. (1) Annual, cumulative addressable markets by 2025E. R
Slide 18: Displacing Lead Acid Today, Replacing Coal Tomorrow
CONFIDENTIAL | 18 TODAY TOMORROW Leader in non-toxic lithium- ion batteries Proprietary non-flammable, non- toxic solid state cells Technology Industry leading batteries and accessories Vertically integrated energy storage system integrator Products DTC + OEMs DTC + OEMs + Fleets + Utilities 99k sq.
Slide 19: Company Overview
CONFIDENTIAL | 19 Company Overview
Slide 20: Lead-Acid: A Toxic Problem
CONFIDENTIAL | 20 Page 20 85% Of the total global consumption of lead is for the production of lead-acid batteries(1) 900K Annual deaths attributed to lead exposure globally(1) 33% Of children suffer from lead poisoning worldwide(2) $1 Trillion Estimated annual cost of lost productivity due to lead
Slide 21: Battle Born Lithium-Ion vs. Lead-Acid Battery
CONFIDENTIAL | 21 Page 21 Dragonfly’s cutting-edge technology is enabling the widespread conversion to green, renewable energy Battle Born Lithium-Ion vs. Lead-Acid Battery Environmentally Safe and Non-Toxic >10x Longer Life 2x – 3x More Power 1/5th the Weight 5x Faster Charging Zero Maintenance Bat
Slide 22: Proprietary Capabilities vs. Li-Ion Competitors
CONFIDENTIAL | 22 Page 22 Low draw technology keeps battery within optimal internal conditions ✓ Optimal Performance in Winter ✓ Verified Outperformance vs. AGM ✓ Self-Regulating ✓ Minimal Energy Drain ✓ No External Energy Required Internally Heated Battery Ensures battery longevity through regulati
Slide 23: State-Of-The-Art Manufacturing Process
CONFIDENTIAL | 23 Page 23 Label and Package Glue, Seal, and Cure Battery Packs Individual Cell Cycling and Sorting Assembly of the Battery Module Battery Module Cycling and Sorting Automated Process Integrate Battery Management System Battery Pack Assembly and Testing In Process of Being Automated S
Slide 24: Proven Go-To-Market Strategy
CONFIDENTIAL | 24 Dragonfly has created a continuous validation loop that begins with educating the consumer and leads to collaboration with the manufacturer Educating the Consumer ▪ Partnered with social media influencers and professional anglers to promote brand through real-world applications ▪ F
Slide 25: Adoption from OEMs
CONFIDENTIAL | 25 Page 25 Customer demand and brand recognition from aftermarket sales driving significant adoption from OEMs DTC vs. OEM Sales as a Percentage of Revenue Adoption from OEMs DTC OEMs Representative Customers 2021 2023E OEM DTC(1) Growing Base of Satisfied Customers “… [Dragonfly] cam
Slide 26: Ideal LFP and NMC Markets
CONFIDENTIAL | 26 Page 26 Source: Dragonfly Energy. Displacing: Lead acid batteries (all types) Competing Clean Technologies: None Key Characteristics: Long life, affordable price, safe, stable Key Considerations: Ideal for powering / charging devices and appliances and low speed vehicles Displacing
Slide 27: Solid State Development
CONFIDENTIAL | 27 Solid State Development
Slide 28: Solid State: Why Does it Matter?
CONFIDENTIAL | 28 Page 28 ▪ Drives Shift from Fossil Fuels: Low levelized cost(1) competes with burning coal and natural gas ▪ Safety: Non-flammable, which enables smart distributed energy storage Dragonfly’s envisioned smart storage solution will allow for a more stable power grid and encourage the
Slide 29: Accelerating the Future with Solid State Development
CONFIDENTIAL | 29 2012 – 2019 2020 2021 2022 – 2024 Develop Dry Spraying Technique Develop Electrodes and Electrolytes Cycle Against Lithium Metal Cycle Against Graphite Assemble Layered Pouch Optimize Chemistry Construct Pilot Production Line Extend Longevity Testing Integrate into Battery Packs Sc
Slide 30: Substantial Competitive Advantages
CONFIDENTIAL | 30 Dragonfly’s unique solid state technology is purpose-designed for cost-effective, highly scalable manufacturing Technological Innovations Manufacturing Innovations ✓ Proprietary Encapsulation Process ✓ Proprietary Spray Powder Application ✓ Non-Flammable and Non-Toxic ✓ Homogenized
Slide 31: Validated Results from Proprietary Process
CONFIDENTIAL | 31 Spray Dryer for Feedstock Encapsulation Powder Coating for Cell Assembly Non-Flammable, Non-Toxic Proven Process for Food and Pharma Proven Process for Automotive Painting Exceptional Layer Interfacing ▪ Dragonfly’s proprietary encapsulation and dry spraying processes result in cel
Slide 32: Financial Highlights
CONFIDENTIAL | 32 Financial Highlights
Slide 33: Financial Projections
CONFIDENTIAL | 33 Financial Projections Included in this presentation are the Company’s estimates for the fiscal years 2022 and 2023 (the “Financial Projections”), based on information known as of the date of this presentation. These projections were prepared by the Company’s management as part of i
Slide 34: Financial Projections (Cont'd)
CONFIDENTIAL | 34 Financial Projections (Cont’d) The Company believes that its operating history provides a reasonable basis for the estimates and assumptions underlying the Financial Projections. Changes in these estimates or assumptions, including assumptions regarding key customer and supplier re
Slide 35: Existing Business Driving Future Success
CONFIDENTIAL | 35 High OEM Revenue Visibility 100% of OEM revenue expected to be generated through 2023 based on existing relationships Existing Business Driving Future Success Source: Dragonfly Energy. Note: Totals may not sum due to rounding. (1) Includes DTC battery sales, accessories, and adjust
Slide 36: Track Record of Profitable Growth
CONFIDENTIAL | 36 x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x x $1 $2 $9 $9 $12 $41 2018 2019 2020 2021 2022E 2023E 20% (5%) (4%) 11% 2% 2% 16% 2020 Materials Costs Growth Investments 2021 Automation Efficiency Platform Scalability 2023E Track Record of Profitable Gro
Slide 37: Financial Summary
CONFIDENTIAL | 37 Financial Summary Source: Dragonfly Energy. Note: Totals may not sum due to rounding. (1) Includes DTC battery sales, accessories, and adjustments. (2) Non-GAAP metric. Adj. EBITDA reconciles to Operating Income (the nearest GAAP financial measure) and adds back stock-based compens
Slide 38: Valuation Benchmarking: EV / 2023E Revenue
CONFIDENTIAL | 38 Page 38 2.0x 2.0x 3.4x 2.4x EV / 2023E Revenue Attractive entry point based on 2023E Revenue with potential substantial upside from solid state technology Source: Dragonfly Energy, FactSet, Public Company Filings. Note: Market data as of 10/15/2021. NM indicates no forecasted reven
Slide 39: Valuation Benchmarking: EV / 2023E EBITDA
CONFIDENTIAL | 39 Page 39 12.2x 57.6x 18.2x 15.5x EV / 2023E EBITDA Attractive entry point based on 2023E EBITDA with potential substantial upside from solid state technology Source: Dragonfly Energy, FactSet, Public Company Filings. Note: Market data as of 10/15/2021. NM indicates no forecasted rev
Slide 40: Valuation Benchmarking: Growth Adjusted Multiples
CONFIDENTIAL | 40 Page 40 5.2x 44.3x 86.0x 1.6x 0.2x 7.8x 4.9x Median Multiples Solid State Tech-Focused Energy Storage Li-ion Battery Manufacturers Vertically Integrated Energy Growth Adjusted EV / 2023E Revenue(1) Growth Adjusted EV / 2023E EBITDA(1) 52.2x Median 4.3x Median Source: FactSet; Publi
Slide 41: Operational Benchmarking
CONFIDENTIAL | 41 Page 41 81% 42% 46% 40% 15% 22% 27% 16% 3% 16% 20% Operational Benchmarking Solid State Tech-Focused Energy Storage Li-ion Battery Manufacturers Vertically Integrated Energy Revenue CAGR (2021 – 2023E) Median 2023E Gross Margin Median 2023E EBITDA Margin Median 46% Median 21% Media
Slide 42: Risk Factors
CONFIDENTIAL | 42 The risks presented below are certain of the general risks related to the business of the Company and the business combination, and such list is not exhaustive. You should carefully consider these risks and uncertainties, and should carry out your own diligence and consult with you
Slide 43: Risks Related to Dragonfly's Solid State Technology Development
CONFIDENTIAL | 43 Risks Related to Dragonfly’s Solid State Technology Development • We face significant engineering challenges in our attempts to develop and manufacture solid state battery cells and these efforts may be delayed or fail which could negatively impact our business. • We expect to make
Slide 44: Risks Related to Financial Position and Capital Requirements
CONFIDENTIAL | 44 Risks Related to Dragonfly’s Financial Position and Capital Requirements • Our business is capital intensive, and we may not be able to raise additional capital on attractive terms, if at all. Any further indebtedness we incur, including pursuant to the commitment letter with Energ
Slide 45: Risks Related to Ownership of CNTQ Securities and the Business Combination (Cont'd)
CONFIDENTIAL | 45 Risks Related to Ownership of CNTQ Securities and the Business Combination (Cont’d) • Our Sponsor, directors or officers or their affiliates may elect to purchase shares from public stockholders, which could reduce the number of shares that may be redeemed in connection with the Bu
Slide 46: Risks Related to Ownership of New Dragonfly's Common Stock
CONFIDENTIAL | 46 Risks Related to Ownership of New Dragonfly’s Common Stock • If securities or industry analysts do not public research or reports about New Dragonfly, or public negative reports, New Dragonfly’s stock price and trading volume could decline. • If the Business Combination’s benefits
Slide 47: Revolutionizing smart energy storage to enable a clean, renewable future
CONFIDENTIAL | 47 Revolutionizing smart energy storage to enable a clean, renewable future