EOS Energy Enterprises Inc. is the latest public company that will have the U.S. government as a shareholder.

The zinc-based battery manufacturer, whose main factory is in Turtle Creek, Pennsylvania, said Tuesday that it signed an agreement with the U.S. Department of Energy to issue the government warrants — vouchers to buy stock — for 570,000 shares. The Department of Energy (DOE) can exercise the warrants anytime in the next five years and convert them into stock at a penny a piece. EOS’s current stock price is $13.48 a share.

The warrants will automatically be converted into shares after one year if EOS’s stock price tops $30 per share, or at the expiration date in five years regardless of the share price.

The deal was struck as a condition of the DOE approving EOS’s issuing more equity — the company announced a private placement of $500 million in equity, some of which would be used to buy out previously issued debt.

The company expects the market for long-duration — up to 12 hours — battery storage to grow rapidly in the coming years. EOS executives tout a pipeline of orders totaling $644.4 million, of which 22% represents data center projects, according to the company’s latest earnings statement released in October.

Its revenue so far is a small fraction of that backlog figure — $30.5 million during the past quarter, which was a company record.

DOE is among EOS’s major financiers. The government agency, under the Biden administration, approved EOS for a $303 million loan to expand its manufacturing capacity. The company has already received the first $91 million.

It announced last month that it would be building new production lines in a building in Marshall, Pennsylvania.

Currently headquartered in Edison, New Jersey, EOS also is getting $24 million in state and local funds to relocate its corporate base and tech staff to Pittsburgh.

With more than 280 million shares outstanding, the 570,000 shares to which DOE is entitled represents less than a quarter of 1% of the company. It is far less than the U.S. government has asked for and received from Intel (10%), Lithium America (10%), and MP Materials (15%).

Last month, Westinghouse agreed to a profit sharing arrangement with the federal government on revenue generated from the sale of nuclear reactors that the government pledged to shepherd along. The agreement with Westinghouse also gives the federal government the ability to force Westinghouse’s owners, Canadian firms Brookfield and Cameco, to spin out the nuclear technology provider as a public company if certain conditions are met. If spun out, the government would be entitled to buy stock equal to 20% of the standalone Westinghouse.

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