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What changed in Nuvve Holding Corp.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Nuvve Holding Corp.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+306 added−315 removedSource: 10-K (2024-03-29) vs 10-K (2023-03-31)

Top changes in Nuvve Holding Corp.'s 2023 10-K

306 paragraphs added · 315 removed · 234 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

54 edited+34 added−9 removed105 unchanged
Biggest changeToday, we continue to advance our software platform’s ability to conduct forecasting, bidding, dispatching and reporting functionalities — so that the needs of the driver, the grid and the EV battery are continually met. 7 Our Strategy Our strategy incorporates a diversified set of segments, geographies and partners, including light duty fleets, heavy duty fleets, automotive original equipment manufacturers (“OEMs”), charge point operators, and strategic partnerships located in Europe, Asia (including Japan) and North America. • Light duty fleet customers are typically organizations that operate vehicle fleets for delivery and logistics, as shared transit for sales, service and other functions requiring a motorpool and for ridesharing services.
Biggest changeToday, we continue to advance our software platform’s ability to conduct forecasting, bidding, dispatching and reporting functionalities — so that the needs of the driver, the grid and the EV battery are continually met. 9 Our Strategy Our strategy incorporates a diversified set of segments, geographies and partners, including the North America school bus market, stationary storage, enhancing our offering with artificial intelligence (AI).
We believe these customers choose to electrify their fleets for economic reasons, as the comparative total cost of ownership favors electrification. Our GIVe software platform can help them lower operating costs and achieve sustainability goals.
We believe these customers choose to electrify their fleets for economic reasons, as the comparative total cost of ownership favors electrification. Our GIVe software platform can help them lower operating costs and achieve sustainability goals.
We offer networked charging stations, infrastructure, software, professional services, support, monitoring and parts and labor warranties required to run electric vehicle fleets, as well as low or free energy costs.
We offer networked charging stations, infrastructure, software, professional services, support, monitoring and parts and labor warranties required to run electric vehicle fleets, as well as low or free energy costs.
V2G technology creates energy equity increasing capacity for grid benefits for everyone. Corporate History We are a Delaware corporation. Our principal executive offices are located at 2488 Historic Decatur Rd., Suite 200, San Diego, California, and our telephone number is (619) 456-5161.
V2G technology creates energy equity increasing capacity for grid benefits for everyone. 21 Corporate History We are a Delaware corporation. Our principal executive offices are located at 2488 Historic Decatur Rd., Suite 200, San Diego, California, and our telephone number is (619) 456-5161.
However, because patent filings can be time-consuming and expensive, our ability to do so may be limited until such time as we are able to generate cash flow from operations or otherwise raise sufficient capital to continue to invest in our intellectual property.
However, because patent filings can be time-consuming and expensive, our ability to do so may be limited until such time as we are able to generate cash flow from 18 operations or otherwise raise sufficient capital to continue to invest in our intellectual property.
As each vehicle is plugged in, our software automatically takes control of each vehicle’s charging and discharging. We aggregate multiple EVs into a VPP. The total available capacity from a coalition of aggregated EVs is bid onto the frequency-controlled reserve market.
As each vehicle is plugged in, our software automatically takes control of each vehicle’s charging and discharging. We aggregate multiple EVs into a VPP. The total available capacity from a coalition of aggregated EVs is bid onto the 3 frequency-controlled reserve market.
Vehicle operators can use our fleet management app and set driving needs for any given day to fulfill their driving duties. 4 Market Opportunity and the Our Solution The EV industry has grown rapidly since we were founded in 2010.
Vehicle operators can use our fleet management app and set driving needs for any given day to fulfill their driving duties. 4 5 Market Opportunity and Our Solution The EV industry has grown rapidly since we were founded in 2010.
Today, we believe we are the “first-mover” in the V2G space with clear competitive advantages, as described in “ Competition ” below. We expect significant market opportunities for our V2G solutions as fleet EVs begin to arrive in more meaningful volume in coming years.
Today, we believe we are the “first-mover” in the V2G space with clear competitive advantages, as described in “ Competition ” below. 12 We expect significant market opportunities for our V2G solutions as fleet EVs begin to arrive in more meaningful volume in coming years.
The light duty fleet segment is accessed via direct sales force and world-wide channel partners. • Heavy duty fleet customers are typically organizations that operate vehicle fleets in the school bus, shuttle bus, delivery truck, refuse truck, and transit bus segments.
The light duty fleet segment is accessed via direct sales force and world-wide channel partners. 10 • Heavy duty fleet customers are typically organizations that operate vehicle fleets in the school bus, shuttle bus, delivery truck, refuse truck, and transit bus segments.
By acting as a reserve to store or release energy into the grid in order to offset variations in demand, the FCR service provided by our GIVe platform assists the local system operator in the critical task of frequency regulation. 2 Over the five-plus years of this deployment, we have accumulated many hours of valuable learning on fleet operation and energy market behavior.
By acting as a reserve to store or release energy into the grid in order to offset variations in demand, the FCR service provided by our GIVe platform assists the local system operator in the critical task of frequency regulation. 2 Over the seven-plus years of this deployment, we have accumulated many hours of valuable learning on fleet operation and energy market behavior.
We primarily compete with less advanced charge point operator EV charge management platforms providing fleet charging services without bi-directional capabilities, such as ChargePoint, Mobility House, EnelX, Shell-NewMotion, Blink and Ovo Energy. There are also additional entrants into the connected EV charging station equipment market, such as General Electric, SemaCharge, EVConnect, Fermata, and Greenlots.
We primarily compete with less advanced charge point operator EV charge management platforms providing fleet charging services without bi-directional capabilities, such as ChargePoint, Mobility House, EnelX, Shell-NewMotion, Blink and Ovo Energy. There are also additional entrants into the connected EV charging station equipment market, such as General Electric, SemaCharge, EVConnect, BP Pulse, Fermata, and Greenlots.
Leading school bus OEMs are thereby ramping up their electric bus production capacity in response to an increasing interest from school districts and fleet operators across the US and Canada. The electric school bus segment thereby represents a key growth opportunity for us to sell V2G capable charging stations and establish long-term recurring revenue streams from grid services.
Leading school bus OEMs are thereby ramping up their electric bus production capacity in response to an increasing interest from school districts and fleet operators across the United States and Canada. The electric school bus segment thereby represents a key growth opportunity for us to sell V2G capable charging stations and establish long-term recurring revenue streams from grid services.
We will explore potential high-quality acquisition opportunities. 10 Government Regulation and Incentives State, regional and local regulations for installation of EV charging stations and the provision of grid services vary from jurisdiction to jurisdiction and may include permitting requirements, inspection requirements, licensing of contractors and certifications, as examples. Compliance with such regulations may cause installation delays.
We will explore potential high-quality acquisition opportunities. 13 Government Regulation and Incentives State, regional and local regulations for installation of EV charging stations and the provision of grid services vary from jurisdiction to jurisdiction and may include permitting requirements, inspection requirements, licensing of contractors and certifications, as examples. Compliance with such regulations may cause installation delays.
If we are unable to do so, our ability to protect our intellectual property or prevent others from infringing our proprietary rights may be impaired. 14 Sales We currently have an in-house field sales force that maintain business relationships with customers and develops new sales opportunities through lead generation and marketing.
If we are unable to do so, our ability to protect our intellectual property or prevent others from infringing our proprietary rights may be impaired. 19 Sales We currently have an in-house field sales force that maintain business relationships with customers and develops new sales opportunities through lead generation and marketing.
The same report projects the annual run-rate of investment in charging points will be $80 billion over the next 20 years. 5 Additional factors propelling this shift to electrification include proposed fossil fuel bans or restrictions, transit electrification mandates, utility incentive programs and declining battery costs.
The same report projects the annual run-rate of investment in charging points will be $80 billion over the next 20 years. 6 Additional factors propelling this shift to electrification include proposed fossil fuel bans or restrictions, transit electrification mandates, utility incentive programs and declining battery costs.
We believes automotive OEM customers recognize that our GIVe software platform can help their customers lower operating costs and achieve sustainability goals, thereby helping to increase electric vehicle sales. We integrate our technology into the automotive OEM’s EV platforms in order to make their vehicles compatible with the GIVe software platform.
We believe automotive OEM customers recognize that our GIVe software platform can help their customers lower operating costs and achieve sustainability goals, thereby helping to increase electric vehicle sales. We integrate our technology into the automotive OEM’s EV platforms in order to make their vehicles compatible with the GIVe software platform.
However, to the extent fuel-efficiency standards are decreased, this may result in less demand for EVs and, in turn, less demand for our V2G technology and services. 12 Research and Development We have invested a significant amount of time and expense into research and development of our GIVe software platform and V2G technology and services.
However, to the extent fuel-efficiency standards are decreased, this may result in less demand for EVs and, in turn, less demand for our V2G technology and services. 15 Research and Development We have invested a significant amount of time and expense into research and development of our GIVe software platform and V2G technology and services.
OSHA establishes certain employer responsibilities, including maintenance of a workplace free of recognized hazards likely to cause death or serious injury, compliance with standards promulgated by the Occupational Safety and Health Administration and various record keeping, 11 disclosure and procedural requirements.
OSHA establishes certain employer responsibilities, including maintenance of a workplace free of recognized hazards likely to cause death or serious injury, compliance with standards promulgated by the Occupational Safety and Health Administration and various record keeping, 14 disclosure and procedural requirements.
Reduced maintenance downtime for EVs compared to internal combustion engine vehicles. 4. EV charging does not present all of the same environmental risks of liquid refueling, as it does not involve the storage and release of hydrocarbons at the refueling site. 6 5.
Reduced maintenance downtime for EVs compared to internal combustion engine vehicles. 4. EV charging does not present all of the same environmental risks of liquid refueling, as it does not involve the storage and release of hydrocarbons at the refueling site. 7 5.
Environmental, Social and Governance All employees are responsible for upholding our core values, including to communicate, collaborate, innovate and be respectful, as well as for adhering to our Code of Ethics and Business Conduct, including our policies on bribery, corruption, conflicts of interest and our whistleblower program.
Environmental, Social and Governance All employees are responsible for upholding our core values, including to communicate, collaborate, innovate and be respectful, as well as for adhering to our Code of Ethics, including our policies on bribery, corruption, conflicts of interest and our whistleblower program.
Combining our innovative V2G technology and an ecosystem of electrification partners, we dynamically manage power among electric vehicle (EV) batteries and the grid to deliver new value to EV owners, accelerate the adoption of EVs, and support the world’s transition to clean energy.
Combining our innovative V2G technology and an ecosystem of electrification partners, we dynamically manage power among EV batteries and the grid to deliver new value to EV owners, accelerate the adoption of EVs, and support the world’s transition to clean energy.
An electric vehicle may interface with the grid by establishing communication with the EVSE, receiving the EVSE attributes, and managing power flow between the EVE and the grid based on the EVSE attributes. 13 US No. 9,043,038 Methods, systems, and apparatus for aggregating electric power flow between an electric grid and electric vehicles.
An electric vehicle may interface with the grid by establishing communication with the EVSE, receiving the EVSE attributes, and managing power flow between the EVE and the grid based on the EVSE attributes. 16 US No. 9,043,038 Methods, systems, and apparatus for aggregating electric power flow between an electric grid and electric vehicles.
If a complaint is financial in nature, the Audit Committee Chair is notified concurrently, which triggers an investigation, action and report. Applying Nasdaq’s listing standards for independence, five of our seven directors are independent. 16 We are committed to protecting the environment and attempt to mitigate any negative impact of our operations.
If a complaint is financial in nature, the Audit Committee Chair is notified concurrently, which triggers an investigation, action and report. Applying Nasdaq’s listing standards for independence, three of our five directors are independent. We are committed to protecting the environment and attempt to mitigate any negative impact of our operations.
We anticipate the electrification of school buses to experience significant growth in the next two to five years, as there are over 600,000 school buses on the road today in the US and Canada. Approximately 95% of them are diesel with an average age of over 11 years.
We anticipate the electrification of school buses to experience significant growth in the next two to five years, as there are over 600,000 school buses on the road today in the United States and Canada. Approximately 95% of them are diesel with an average age of over 11 years.
While Tesla does offer EV charging services, these do 15 not include V2G and we do not believe Tesla vehicles are capable of bi-directional power flow.
While Tesla does offer EV charging services, these do not include V2G and we do not believe Tesla vehicles are currently capable of bi-directional power flow.
Our Grid Integrated Vehicle (“GIVe”) software platform enables us to aggregate multiple EV batteries into a virtual power plant (“VPP”) to provide bidirectional services to the electrical grid in a qualified and secure manner. VPPs can generate revenue by selling excess power to utility companies, utilizing the stored power to perform grid services, or reduce building energy peak consumption.
Our GIVe software platform enables us to aggregate multiple EV batteries into a virtual power plant (“VPP”) to provide bidirectional services to the electrical grid in a qualified and secure manner. VPPs can generate revenue by selling excess power to utility companies, utilizing the stored power to perform grid services, or reduce building energy peak consumption.
Information contained in our web site does not constitute a part of this report or our other filings with the SEC. 17
Information contained in our web site does not constitute a part of this report or our other filings with the SEC. 22
If the University of Delaware terminates the agreement upon a material breach by us of certain limited provisions of the IP assignment agreement (which do not include the milestone payment provisions) that is not cured within 45 days after notice from the university, we will be required to assign the patents back to the university.
If the University of Delaware terminates the agreement upon a material breach by us of certain limited provisions of the intellectual property agreement (which do not include the milestone payment provisions) that is not cured within 45 days after notice from the university, we will be required to assign the patents back to the university.
Several states and groups have announced intentions to sue the United States government over this reformulation, so the final CAFE standards cannot currently be predicted with any certainty.
Several states and groups have announced intentions to sue the U.S. government over this reformulation, so the final CAFE standards cannot currently be predicted with any certainty.
During the years ended December 31, 2022 and 2021, our top five customers accounted for approximately 54.7% and 44.0%, respectively, of our total revenue. Our customer concentration has historically varied based on the receipt of large orders, a trend that we expect to continue in the near term. Manufacturing and Suppliers We do not manufacture electric vehicle charging stations.
During the years ended December 31, 2023 and 2022, our top five customers accounted for approximately 38.9% and 54.7%, respectively, of our total revenue. Our customer concentration has historically varied based on the receipt of large orders, a trend that we expect to continue in the near term. Manufacturing and Suppliers We do not manufacture electric vehicle charging stations.
The average remaining life of our patents was approximately 9.8 years as of December 31, 2022. We intend to continue to regularly assess opportunities for seeking patent protection for those aspects of our technology, designs and methodologies that we believe provide a meaningful competitive advantage.
As of December 31, 2023, the average remaining life of our U.S. patents was approximately 8.8 years . We intend to continue to regularly assess opportunities for seeking patent protection for those aspects of our technology, designs and methodologies that we believe provide a meaningful competitive advantage.
The IP acquisition agreement terminates upon the later of the date all the milestone payments described above are made and the expiration date of the patents transferred to us.
The intellectual property acquisition agreement terminates upon the later of the date all the milestone payments described above are made and the expiration date of the patents transferred to us.
We believe that we have competitive advantages over our competitors, such as our intellectual property portfolio (we own key patents for V2G); qualification by transmission system operators (we are already qualified by multiple operators, making it easier for us to expand into other areas); experience (over a decade of experience of market participation and stakeholder interaction); and data ownership (we have accumulated vast amounts of data, which is the key for rapid and future developments).
Because our competitors’ platforms are less advanced in providing V2G services, we believe we face limited direct competition. 20 We believe that we have competitive advantages over our competitors, such as our intellectual property portfolio (we own key patents for V2G); qualification by transmission system operators (we are already qualified by multiple operators, making it easier for us to expand into other areas); experience (over a decade of experience of market participation and stakeholder interaction); and data ownership (we have accumulated vast amounts of data, which is the key for rapid and future developments).
The following is an abstract of each of the four issued United States Patents: Patent Primary Claims US No. 8,116,915 A method and apparatus for managing system energy flow.
The following is an abstract of each of the six issued U.S. patents: Patent Primary Claims US No. 8,116,915 A method and apparatus for managing system energy flow.
Human Capital Resources As of December 31, 2022, we had 56 regular full-time employees, 19 of whom were engaged in research and development activities, and seven contract workers, four of whom were engaged in research and development activities. None of our employees are represented by a labor union, and we believe we maintain good relations with our employees.
Human Capital Resources As of December 31, 2023, we had 47 regular full-time employees, 17 of whom were engaged in research and development activities, and two contract workers engaged in research and development activities. None of our employees are represented by a labor union, and we believe we maintain good relations with our employees.
Our research and development is principally conducted at our headquarters in San Diego, California. As of December 31, 2022, we had 19 full-time employees and four contract workers engaged in its research and development activities.
Our research and development is principally conducted at our headquarters in San Diego, California. As of December 31, 2023, we had 17 full-time employees and two contract workers engaged in research and development activities.
We continue to invest in expanding our GIVe software platform and V2G service capabilities and in the other areas described below, as well as in the service and maintenance of our company-owned stations and those stations with service and maintenance plans. 9 • The development and advancement of our GIVe software platform’s capabilities is critical to fulfilling our product vision for a platform that is adaptable, adjustable and scalable. • We believe it is important to continue developing our global sales channels and grow our direct sales capabilities in order to support customer acquisition.
We continue to invest in expanding our GIVe software platform and V2G service capabilities and in the other areas described below, as well as in the service and maintenance of our company-owned stations and those stations with service and maintenance plans. • The development and advancement of our GIVe software platform’s capabilities is critical to fulfilling our product vision for a platform that is adaptable, adjustable and scalable.
We integrate our technology into V2G-capable charging stations made by dedicated manufacturing partners located throughout the world. However, our principal supplier of bidirectional DC Chargers is Rhombus Energy Solutions, and identifying a suitable alternative supplier could be an extensive process. We have not experienced any direct disruptions in our supply chain as a result of the COVID-19 pandemic.
We integrate our technology into V2G-capable charging stations made by dedicated manufacturing partners located throughout the world. However, our principal supplier of bidirectional DC Chargers is Rhombus Energy Solutions, and identifying a suitable alternative supplier could be an extensive process.
Customers For the years ended December 31, 2022 and 2021, we had customers whose revenue individually represented 10% or more of our total revenue. For the years ended December 31, 2022 and 2021, one customer accounted for 32.1% and 12.4% of our total revenue, respectively.
Customers For the years ended December 31, 2023 and 2022, we had customers whose revenue individually represented 10% or more of our total revenue. For the years ended December 31, 2023 and 2022, three customers accounted for 30.3% and 32.1% of our total revenue, respectively.
This design incorporates (1) aggregation capabilities for available vehicles, charging stations and stationary batteries; (2) the ability to receive signals from and thereby know the needs of the grid at generation, transmission, distribution and behind-the-meter regions; and (3) real-time optimization that matches available coalition capacity onto grid needs on a second-by-second basis, all while ensuring the desired EV battery charge level at drive time. 3 Electric vehicles are inherently unreliable grid resources because their primary transportation function can cause them to be plugged in or unplugged at any time with varying states of charge.
This design incorporates (1) aggregation capabilities for available vehicles, charging stations and stationary batteries; (2) the ability to receive signals from and thereby know the needs of the grid at generation, transmission, distribution and behind-the-meter regions; and (3) real-time optimization that matches available coalition capacity onto grid needs on a second-by-second basis, all while ensuring the desired EV battery charge level at drive time.
There are many other large and small EV charger companies that offer non-networked or “basic” chargers that have limited customer leverage, but could provide a low-cost solution for basic charger needs in commercial and home locations. Because our competitors’ platforms are less advanced in providing V2G services, we believe we face limited direct competition.
There are many other large and small EV charger companies that offer non-networked or “basic” chargers that have limited customer leverage, but could provide a low-cost solution for basic charger needs in commercial and home locations.
Nuvve Holding Corp., a Delaware corporation, has developed a proprietary vehicle-to-grid (V2G) technology, including its Grid Integrated Vehicle (“GIVe™”) cloud-based software platform, that enables it to link multiple electric vehicle (“EV”) batteries into a virtual power plant to provide bi-directional energy to the electrical grid in a qualified and secure manner.
We have developed a proprietary vehicle-to-grid ("V2G") technology, including our Grid Integrated Vehicle (“GIVe”) cloud-based software platform, that enables us to link multiple electric vehicle (“EV”) batteries into a virtual power plant to provide bi-directional energy to the electrical grid in a qualified and secure manner.
Item 1. Business Unless the context otherwise requires, references in this section to “we,” “us” and “our” and to “Nuvve” and the “Company” are to Nuvve Corporation and its subsidiaries for periods prior to the Business Combination ( as described under "Corporate Information" below) and Nuvve Holding Corp. and its subsidiaries, including Nuvve Corporation, for periods after the Business Combination.
Item 1. Business Unless the context otherwise requires, references in this section to “we,” “us” and “our” and to “Nuvve” and the “Company” are to Nuvve Holding Corp. and its subsidiaries.
Presently, grid services revenue comprises a small portion of our revenue, but we expect this portion to grow. By employing a capital-light business model, we are able to strategically allocate our capital into research and development, marketing and sales and public policy.
By employing a capital-light business model, we are able to strategically allocate our capital into research and development, marketing and sales and public policy.
This includes expanding our network of global partners who sell, install and maintain our solutions. We have and will continue to focus on category awareness and consistent branding. • We continue to invest in our long-running efforts in policy and utility relationships.
We have and will continue to focus on category awareness and consistent branding. • We continue to invest in our long-running efforts in policy and utility relationships.
Our success depends in part upon our ability to obtain and maintain proprietary protection for our products, technology and know-how, to operate without infringing the proprietary rights of others, and to prevent others from infringing our proprietary rights.
Our success depends in part upon our ability to obtain and maintain proprietary protection for our products, technology and know-how, to operate without infringing the proprietary rights of others, and to prevent others from infringing our proprietary rights. As of December 31, 2023, we had six U.S. patents issued, and various corresponding foreign issued applications from five distinct patent families.
Since 2010, we have been optimizing our energy software as a service (SaaS) model into a product that is adaptable (evolving with energy markets worldwide), adjustable (micro-service based to enable quick iteration) and scalable (compatible with widely adopted standards for EVs and charging stations).
Our current addressable energy and capacity markets for targeted grid services (frequency regulation, demand charge management, demand response, energy optimization, distribution grid services and energy arbitrage) are estimated to be of considerable value — each ranging from $3 billion to $250 billion per year. 8 Since 2010, we have been optimizing our energy software as a service (SaaS) model into a product that is adaptable (evolving with energy markets worldwide), adjustable (micro-service based to enable quick iteration) and scalable (compatible with widely adopted standards for EVs and charging stations).
In previous years, a substantial portion of our revenues have been derived from these grant funded projects, and we expect growth in company-owned stations and the related government grant funding to continue. We anticipate that such projects will constitute a declining percentage of our business as our commercial operations expand.
Levo is our consolidated subsidiary. 11 We also operate a small number of company-owned charging stations serving as demonstration projects funded by government grants. In previous years, a substantial portion of our revenues have been derived from these grant funded projects, and we expect growth in company-owned stations and the related government grant funding to continue.
We expect to generate revenue primarily from the provision of services to the grid via our GIVe software platform and sales of V2G-enabled charging stations. In the case of light duty fleet and heavy duty fleet customers, we also may receive a mobility fee, which is a recurring fixed payment made by fleet customers per fleet vehicle.
In the case of light duty fleet and heavy duty fleet customers, we also may receive a mobility fee, which is a recurring fixed payment made by fleet customers per fleet vehicle. In addition, we may generate non-recurring engineering services revenue derived from the integration of our technology with automotive OEMs and charge point operators.
However, certain of our charging station manufacturing partners experienced longer lead times in the acquisition of critical components, leading to delays in completing certain integration projects. Competition We provide a globally-available, commercial V2G technology platform that enables EV batteries to store and resell unused energy back to the local electric grid.
Competition We provide a globally-available, commercial V2G technology platform that enables EV batteries to store and resell unused energy back to the local electric grid.
In addition, we may generate non-recurring engineering services revenue derived from the integration of our technology with automotive OEMs and charge point operators. In the case of recurring grid services revenue generated via automotive OEM and charge point operator customer integrations, we may share the recurring grid services revenue with the customer.
In the case of recurring grid services revenue generated via automotive OEM and charge point operator customer integrations, we may share the recurring grid services revenue with the customer. Presently, grid services revenue comprises a small portion of our revenue, but we expect this portion to grow.
In the United States, the patent term is 20 years from the earliest date of filing a non-provisional patent application.
This European patent was validated in the following territories: BE, DE, FR, GB, IT and SE. The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained. In the United States, the patent term is 20 years from the earliest date of filing a non-provisional patent application.
We own these patents, including the four issued United States patents, which were acquired from the University of Delaware pursuant to an IP acquisition agreement, dated November 7, 2017.
Additionally, we have various pending U.S. patent applications and Patent Cooperation Treaty applications. These patents relate to various bi-directional (V2G) and uni-directional (V1G) EV charging functionalities, aggregation and grid services. We own these patents, including four U.S. patents, that were acquired from the University of Delaware pursuant to an intellectual property acquisition agreement, dated November 7, 2017.
Power may be transferred between the grid and the electric vehicle by maintaining EVSE attributes, establishing communication with the EVE, and transmitting the EVSE maintained attributes to the EVE. The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained.
Power may be transferred between the grid and the electric vehicle by maintaining EVSE attributes, establishing communication with the EVE, and transmitting the EVSE maintained attributes to the EVE. US No. 11,695,274 Certain aspects of the present disclosure relate to a local energy management system (LEMS) at local mixed power generating sites for providing grid services and grid service applications.
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Our current addressable energy and capacity markets for targeted grid services (frequency regulation, demand charge management, demand response, energy optimization, distribution grid services and energy arbitrage) are estimated to be of considerable value — each ranging from $3 billion to $250 billion per year.
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Our GIVe platform also provides electric vehicle charging load management services allowing customers to reduce energy consumption during peak demand periods, simultaneously reducing the burden on the grid while optimizing EV charging. We can perform charge management services at the individual vehicle level and across an entire fleet of EVs.
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Levo is our consolidated subsidiary. 8 Levo is a sustainable infrastructure company focused on rapidly advancing the electrification of transportation by funding V2G-enabled EV fleet deployments.
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The GIVE platform constantly communicates with the electricity infrastructure, charge points, and charging EVs, creating a balanced and optimized eco system. Electric vehicles are inherently unreliable grid resources because their primary transportation function can cause them to be plugged in or unplugged at any time with varying states of charge.
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Levo utilizes our V2G technology and committed capital from Stonepeak and Evolve to offer Fleet-as-a-Service for school buses, last-mile delivery, ride hailing and ride sharing, municipal services, and more to eliminate the primary barriers to EV fleet adoption including large upfront capital investments and lack of expertise in securing and managing EVs and associated charging infrastructure.
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We operate our platform across light duty fleets, heavy duty fleets, automotive original equipment manufacturers (“OEMs”), charge point operators, and strategic partnerships located in Europe, Asia (including Japan) and North America. • Capturing opportunities in the North America school bus market.
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Levo's turnkey solution simplifies and streamlines electrification, can lower the total cost of EV operation for fleet owners, and support the grid when the EVs are not in use.
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There are 600,000 school buses in North America being replaced at an average pace of 40,000 to 50,000 buses per year. School buses are not only parked most of the time (97% of the time on average), but they represent a use case for V2G that is easy for everyone to understand.
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For a fixed monthly payment with no upfront cost, Levo will provide the EVs, such as electric school buses, charging infrastructure powered by our V2G platform, EV and charging station maintenance, energy management, and technical advice.
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Electrifying school buses remains a top priority for the Biden administration, as evidenced by the federal government’s $5 billion grant to the EPA to support electric school bus deployment. Through initiatives such as our partnership with Blue Bird, we are well-positioned to capitalize on this push toward electrification.
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Levo will initially focus on electrifying school buses, providing associated charging infrastructure, and delivering V2G services to enable safer and healthier transportation for children while supporting carbon dioxide emission reduction, renewable energy integration, and improved grid resiliency. We also operate a small number of company-owned charging stations serving as demonstration projects funded by government grants.
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Today, Nuvve’s K-12 business, our business unit focused on school buses, is continuously accelerating and we expect will provide more than 80% of our revenue in 2024, and soon will yield 500 school buses connected to our platform.
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As of December 31, 2022, we h ad four United States patents issued, four United States pending non-provisional patent applications and one United States pending provisional patent applications. Additionally, we had nine issued foreign patents (in Europe, India, Japan, China and Korea) and three foreign patent applications currently pending in various foreign jurisdictions.
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With third-party forecasts calling for the further acceleration of electric school bus deployments in 2024 compared with 2023, and assuming we maintain our existing market share of charging station sales, we see a path forward to potentially tripling our charging station unit sales and doubling hardware revenues in 2024 compared with 2023.
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In addition, as of December 31, 2022, there was one pending Patent Cooperation Treaty application. These patents relate to various bi-directional (V2G) and uni-directional (V1G) EV charging functionalities, aggregation and grid services.
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Our value proposition is now rooted on vehicle readiness, energy management, and battery life extension. We are fortifying our position as a leading service provider in the space.
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In the United States, a patent’s term may be shortened if a patent is terminally disclaimed over another patent or as a result of delays in patent prosecution by the patentee, and a patent’s term may be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the United States Patent and Trademark Office in granting a patent.
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We have demonstrated that we know how to support our customers in this segment and, as we launch new services in Texas, which has the largest school bus fleet in the United States, we are confident that we will maintain our leadership position. • Applying our technology to the stationary storage sector.
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Our core technology transforms EVs (which are inherently difficult grid assets to manage because they can be plugged or unplugged at any time) into reliable, dispatchable, and monetizable assets that can perform complex and demanding grid services. These capabilities also allow us to manage stationary storage.
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With our advanced platform, we believe that we can extract more value from these stationary batteries than any other player in the space. Such batteries are included in our deployments with Circle K, as well as at the University of California, San Diego, and the University of Delaware.
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More and more, developers and battery manufacturers are coming to us to manage battery deployments already underway. This allows us to accelerate the growth of Megawatts Under Management ("MWUM") and flex our grid service muscles with multiple megawatts already in the pipeline, mostly focused on local energy management combined with high value grid services.
Added
Deploying stationary storage either alone or in combination with electric vehicles is well-aligned with our strategy. Our strong differentiator compared to the majority of our competitive set is our ability to provide energy management with both advanced grid services and resiliency.
Added
Looking ahead, we believe that stationary batteries will represent 15% our deployments for the next 3 years; this ranks high amongst our priorities and will provide the opportunity to realize cash faster than EVs as the Energy Management Platform business allows for significant upfront cash payment.
Added
Stationary storage is also a key technology piece associated with microgrid deployments, an area in which we have won two California Energy Commission ("CEC") projects to support our technology development. It is also a key support to our CPO ("Charge Point Operator") business. • Enhancing our offerings with AI.
Added
We believe we are providing best-in-class forecasting capabilities for CPOs and Utilities through Astrea AI’s offerings.
Added
The fundamental predictive analytics work we have done through our partnership with 2021.ai has supported the development of advanced features that allow us to predict with a high level of confidence when an EV will be connected to a charging station and the amount of kWh it will need to onboard during the session.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to the Ownership of Our Securities If we are unable to maintain compliance with the Nasdaq Stock Market’s listing requirements, our common stock may be delisted from the Nasdaq Capital Market, which could have a material adverse effect on our financial condition and could make it more difficult for holders of our common stock to sell their shares. 44 Our common stock is currently listed on the Nasdaq Capital Market and is therefore subject to the continued listing requirements of the Nasdaq Capital Market, including requirements with respect to the market value of publicly held shares, market value of listed shares, minimum bid price per share, and minimum stockholder’s equity, among others, and requirements relating to board and committee independence.
Biggest changeRisks Related to the Ownership of Our Securities If we are unable to maintain compliance with the Nasdaq Stock Market’s listing requirements, our common stock may be delisted from the Nasdaq Capital Market, which could have a material adverse effect on our financial condition and could make it more difficult for holders of our common stock to sell their shares.
Managing this expansion requires additional resources and controls, and our international operations subject us to additional risks, including: • conformity with applicable business customs, including translation into foreign languages and associated expenses; • lack of availability of government incentives and subsidies; • challenges in arranging, and availability of, financing for customers; • potential changes to its established business model; • difficulties in staffing and managing foreign operations in an environment of diverse culture, laws, and customers, and the increased travel, infrastructure, and legal and compliance costs associated with international operations; • installation and interconnection challenges; • differing transportation modalities in other markets; • different levels of demand among commercial and fleet customers; • compliance with multiple, potentially conflicting and changing governmental laws, regulations, certifications, and permitting processes including environmental, banking, employment, tax, information security, privacy, and data protection laws and regulations such as the EU General Data Protection Regulation, national legislation implementing the same and changing requirements for legally transferring data out of the European Economic Area; • compliance with U.S. and foreign anti-bribery laws including the Foreign Corrupt Practices Act and the United Kingdom Anti-Bribery Act; • conforming products and services to various international regulatory and safety requirements as well as charging and other electric infrastructures; • difficulties in establishing, staffing and managing foreign operations; 25 • difficulties in collecting payments in foreign currencies and associated foreign currency exposure; • restrictions on repatriation of earnings; • compliance with potentially conflicting and changing laws of taxing jurisdictions and compliance with applicable U.S. tax laws as they relate to international operations, the complexity and adverse consequences of such tax laws, and potentially adverse tax consequences due to changes in such tax laws; and • regional economic and political conditions.
Managing this expansion requires additional resources and controls, and our international operations subject us to additional risks, including: • conformity with applicable business customs, including translation into foreign languages and associated expenses; • lack of availability of government incentives and subsidies; • challenges in arranging, and availability of, financing for customers; • potential changes to its established business model; • difficulties in staffing and managing foreign operations in an environment of diverse culture, laws, and customers, and the increased travel, infrastructure, and legal and compliance costs associated with international operations; • installation and interconnection challenges; • differing transportation modalities in other markets; • different levels of demand among commercial and fleet customers; • compliance with multiple, potentially conflicting and changing governmental laws, regulations, certifications, and permitting processes including environmental, banking, employment, tax, information security, privacy, and data protection laws and regulations such as the EU General Data Protection Regulation, national legislation implementing the same and changing requirements for legally transferring data out of the European Economic Area; • compliance with U.S. and foreign anti-bribery laws including the Foreign Corrupt Practices Act and the United Kingdom Anti-Bribery Act; • conforming products and services to various international regulatory and safety requirements as well as charging and other electric infrastructures; • difficulties in establishing, staffing and managing foreign operations; • difficulties in collecting payments in foreign currencies and associated foreign currency exposure; • restrictions on repatriation of earnings; • compliance with potentially conflicting and changing laws of taxing jurisdictions and compliance with applicable U.S. tax laws as they relate to international operations, the complexity and adverse consequences of such tax laws, and potentially adverse tax consequences due to changes in such tax laws; and • regional economic and political conditions.
Our amended and restated certificate of incorporation and bylaws will afford certain rights and powers to our board of directors that could contribute to the delay or prevention of an acquisition that it deems undesirable, including: • a classified board with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of our board of directors; • the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror; • the right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which may prevent stockholders from being able to fill vacancies on our board of directors; • the requirement that a special meeting of stockholders may be called only by our board of directors, our Chairman of the Board or our Chief Executive Officer, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; and • the requirement for the affirmative vote of holders of at least 66 ⅔% of the voting power of all of the then-outstanding shares of the voting stock, voting together as a single class, to amend certain provisions of our amended and restated certificate of incorporation or to amend our bylaws, which may inhibit the ability of an acquiror to effect such amendments to facilitate an unsolicited takeover attempt.
Our amended and restated certificate of incorporation and bylaws will afford certain rights and powers to our board of directors that could contribute to the delay or prevention of an acquisition that it deems undesirable, including: • a classified board with three-year staggered terms, which could delay the ability of stockholders to change the membership of a majority of our board of directors; 50 • the ability of our board of directors to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquiror; • the right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or the resignation, death or removal of a director, which may prevent stockholders from being able to fill vacancies on our board of directors; • the requirement that a special meeting of stockholders may be called only by our board of directors, our Chairman of the Board or our Chief Executive Officer, which could delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors; and • the requirement for the affirmative vote of holders of at least 66 ⅔% of the voting power of all of the then-outstanding shares of the voting stock, voting together as a single class, to amend certain provisions of our amended and restated certificate of incorporation or to amend our bylaws, which may inhibit the ability of an acquiror to effect such amendments to facilitate an unsolicited takeover attempt.
The market for EVs could be affected by numerous factors, such as: • perceptions about EV features, quality, safety, performance and cost; • perceptions about the limited range over which EVs may be driven on a single battery charge; • competition, including from other types of alternative fuel vehicles, plug-in hybrid electric vehicles and high fuel-economy internal combustion engine vehicles; • volatility in the cost of oil and gasoline; • concerns regarding the stability of the electrical grid; • the decline of an EV battery’s ability to hold a charge over time; • availability of service for EVs; • consumers’ perception about the convenience and cost of charging EVs; • increases in fuel efficiency; • government regulations and economic incentives, including adverse changes in, or expiration of, favorable tax incentives related to EVs, EV charging stations or decarbonization generally; • relaxation of government mandates or quotas regarding the sale of EVs; and • concerns about the future viability of EV manufacturers.
The market for EVs could be affected by numerous factors, such as: • perceptions about EV features, quality, safety, performance and cost; • perceptions about the limited range over which EVs may be driven on a single battery charge; • competition, including from other types of alternative fuel vehicles, plug-in hybrid electric vehicles and high fuel-economy internal combustion engine vehicles; • volatility in the cost of oil and gasoline; • concerns regarding the stability of the electrical grid; 32 • the decline of an EV battery’s ability to hold a charge over time; • availability of service for EVs; • consumers’ perception about the convenience and cost of charging EVs; • increases in fuel efficiency; • government regulations and economic incentives, including adverse changes in, or expiration of, favorable tax incentives related to EVs, EV charging stations or decarbonization generally; • relaxation of government mandates or quotas regarding the sale of EVs; and • concerns about the future viability of EV manufacturers.
Our after-tax profitability and financial results could be subject to volatility or be affected by numerous factors, including (a) the availability of tax deductions, credits, exemptions, refunds (including refunds of value added taxes) and other benefits to reduce our tax liabilities, (b) changes in the valuation of our deferred tax assets and liabilities, (c) expected timing and amount of the release of any tax valuation allowances, (d) tax treatment of stock-based compensation, (e) changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, (f) the potential expansion of our business into or otherwise becoming subject to tax in additional jurisdictions, (g) changes to our existing intercompany structure (and any costs related thereto) and business operations, (h) the extent of our intercompany transactions and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions and (i) our ability to structure our operations in an efficient and competitive manner.
Our after-tax profitability and financial results could be subject to volatility or be affected by numerous factors, including (a) the availability of tax deductions, credits, exemptions, refunds (including refunds of value added taxes) and other benefits to reduce our tax liabilities, (b) changes in the valuation of our deferred tax assets and liabilities, (c) expected timing and amount of the release of any tax valuation allowances, (d) tax treatment of stock-based compensation, (e) changes in the relative amount of our earnings subject to tax in the various jurisdictions in which we operate or have subsidiaries, (f) the potential expansion of our business into or otherwise becoming subject to tax in additional jurisdictions, (g) changes to our existing intercompany structure (and any costs related thereto) and business operations, (h) the extent of our intercompany transactions and the extent to which taxing authorities in the relevant jurisdictions respect those intercompany transactions and (i) our ability to structure our operations in an efficient and 42 competitive manner.
In addition, in the event the University of Delaware notifies us of a third party’s interest in a region in which the patents are valid, and we do not within 60 days inform the university that either we intend to address the region pursuant to a commercially reasonable development plan or intend to enter into a license agreement with an identified third party, we will be deemed to have granted to the University of Delaware an exclusive sublicensable license to the patents in the unaddressed region.
In addition, in the event the University of Delaware notifies us of a third party’s interest in a region in which the patents are valid, and we do not within 60 days inform the university that either we intend to address the region 29 pursuant to a commercially reasonable development plan or intend to enter into a license agreement with an identified third party, we will be deemed to have granted to the University of Delaware an exclusive sublicensable license to the patents in the unaddressed region.
We may in the future experience service disruptions, outages, and other performance problems due to a variety of factors, including infrastructure changes, third-party service providers, human or software errors and capacity constraints. If our services are unavailable when users attempt to access them, they may seek other services, which could reduce demand for our solutions from target customers.
We may in the future experience service disruptions, outages, and other performance problems due to a variety of factors, including infrastructure changes, third-party service providers, human or software errors and capacity constraints. If our 38 services are unavailable when users attempt to access them, they may seek other services, which could reduce demand for our solutions from target customers.
Partners in our ventures and strategic alliances who provide financing may prioritize the return of their investment over maximizing the value of the enterprise. 20 In cases where we choose to pursue a business through a joint venture and strategic alliance, we cannot assure you that financing for the business would not be available on more favorable terms through other sources.
Partners in our ventures and strategic alliances who provide financing may prioritize the return of their investment over maximizing the value of the enterprise. In cases where we choose to pursue a business through a joint venture and strategic alliance, we cannot assure you that financing for the business would not be available on more favorable terms through other sources.
Any defects or errors in product or services offerings, or the perception of such defects or errors, or other performance problems could result in any of the following, each of which could adversely affect our business and results of our operations: 32 • expenditure of significant financial and product development resources, including recalls, in efforts to analyze, correct, eliminate or work around errors or defects; • loss of existing or potential customers or partners; • interruptions or delays in sales; • delayed or lost revenue; • delay or failure to attain market acceptance; • delay in the development or release of new functionality or improvements; • negative publicity and reputational harm; • sales credits or refunds; • exposure of confidential or proprietary information; • diversion of development and customer service resources; • breach of warranty claims; • legal claims under applicable laws, rules, and regulations; and • an increase in collection cycles for accounts receivable or the expense and risk of litigation.
Any defects or errors in product or services offerings, or the perception of such defects or errors, or other performance problems could result in any of the following, each of which could adversely affect our business and results of our operations: • expenditure of significant financial and product development resources, including recalls, in efforts to analyze, correct, eliminate or work around errors or defects; • loss of existing or potential customers or partners; • interruptions or delays in sales; • delayed or lost revenue; • delay or failure to attain market acceptance; • delay in the development or release of new functionality or improvements; • negative publicity and reputational harm; • sales credits or refunds; • exposure of confidential or proprietary information; • diversion of development and customer service resources; • breach of warranty claims; 37 • legal claims under applicable laws, rules, and regulations; and • an increase in collection cycles for accounts receivable or the expense and risk of litigation.
As technologies change, we plan to integrate, upgrade or adapt our V2G technology and services, and to introduce new services in order to continue increasing the value we provide to customers. Increases in costs, disruption of supply or shortage of raw materials, particularly lithium-ion battery cells, could harm the ability of EV manufacturers to produce electric vehicles.
As technologies change, we plan to integrate, upgrade or adapt our V2G technology and services, and to introduce new services in order to continue increasing the value we provide to customers. 31 Increases in costs, disruption of supply or shortage of raw materials, particularly lithium-ion battery cells, could harm the ability of EV manufacturers to produce electric vehicles.
We have incurred significant net losses since inception and will continue to incur significant losses and, therefore, we do not know whether or when the combined carryforwards, which may be or may become subject to limitation by Sections 382 and 383 of the Code, will be utilized. Our reported financial results may be negatively impacted by changes in U.S. GAAP.
We have incurred significant net losses since inception and will continue to incur significant losses and, therefore, we do not know whether or when the combined carryforwards, which may be or may become subject to limitation by Sections 382 and 383 of the Code, will be utilized. Our reported financial results may be negatively impacted by changes in U.S.
New competitors in these markets could also create significant transformation of the market short and long term. If we are unable to provide planned services to the energy markets or generate the anticipated revenue from the provision of out services, it would have a material adverse effect on our financial condition and results of operations.
New competitors in these markets could also create significant transformation of the market short and long term. If we are unable to provide planned services to the energy markets or generate the anticipated revenue from the provision of our services, it would have a material adverse effect on our financial condition and results of operations.
Our business will be harmed if continuing investment in our sales and marketing capabilities does not generate a significant increase in revenue. We may be unable to leverage customer data in all geographic locations, and this limitation may impact research and development operations. We rely on data collected through charging stations, including usage data and geolocation data.
Our business will be harmed if continuing investment in our sales and marketing capabilities does not generate a significant increase in revenue. We may be unable to leverage customer data in all geographic locations, and this limitation may impact research and development operations. 40 We rely on data collected through charging stations, including usage data and geolocation data.
Despite our belief in our technological and price advantages, fleet managers are often less familiar with EVs and the variety of charging solutions available now and in the future, and as a result decisions by fleet managers may be delayed or they may choose the services of one of our competitors even in cases where our offering is superior.
Despite our belief in our technological and price advantages, fleet managers are often less 27 familiar with EVs and the variety of charging solutions available now and in the future, and as a result decisions by fleet managers may be delayed or they may choose the services of one of our competitors even in cases where our offering is superior.
We also must rely on this supply chain for detecting and reporting cyber incidents, which could affect our ability to report or respond to cybersecurity incidents effectively or in a timely manner. The costs related to cyber or other security threats or disruptions may not be fully insured or indemnified by other means.
We also must rely on this supply chain for detecting and reporting cyber incidents, which could affect our ability to report or respond to cybersecurity incidents effectively or in a timely manner. 39 The costs related to cyber or other security threats or disruptions may not be fully insured or indemnified by other means.
We plan to continue to expand our direct sales force both domestically and internationally but it may not be able to recruit and hire a sufficient number of sales personnel, which may adversely affect our ability to expand our sales capabilities. New hires require significant training and time before they achieve full productivity, particularly in new sales territories.
We plan to continue to expand our direct sales force both domestically and internationally but we may not be able to recruit and hire a sufficient number of sales personnel, which may adversely affect our ability to expand our sales capabilities. New hires require significant training and time before they achieve full productivity, particularly in new sales territories.
Moreover, if we or any of our employees or contractors fails or is believed to fail to adhere to appropriate practices regarding customers’ data, it may damage our reputation and brand. 42 Additionally, existing laws, regulations, standards, and other obligations may be interpreted in new and differing manners in the future, and may be inconsistent among jurisdictions.
Moreover, if we or any of our employees or contractors fails or is believed to fail to adhere to appropriate practices regarding customers’ data, it may damage our reputation and brand. Additionally, existing laws, regulations, standards, and other obligations may be interpreted in new and differing manners in the future, and may be inconsistent among jurisdictions.
While we anticipate that we will maintain or increase our stake in the business venture, there can be no assurance that we will be able to do so. If we are unable to attract and retain key employees and hire qualified management, technical and vehicle engineering personnel, our ability to compete could be harmed.
While we anticipate that we will maintain or increase our stake in the business venture, there can be no assurance that we will be able to do so. 30 If we are unable to attract and retain key employees and hire qualified management, technical and vehicle engineering personnel, our ability to compete could be harmed.
If we raise funds through the issuance of debt securities or through loan arrangements, the terms of such financings could require significant interest payments, contain covenants that restrict our 36 business, or otherwise include unfavorable terms. In addition, to the extent we raise funds through the sale of additional equity securities, our stockholders would experience additional dilution.
If we raise funds through the issuance of debt securities or through loan arrangements, the terms of such financings could require significant interest payments, contain covenants that restrict our business, or otherwise include unfavorable terms. In addition, to the extent we raise funds through the sale of additional equity securities, our stockholders would experience additional dilution.
These investments may not yield a favorable return to our stockholders. If we do not invest or apply our cash and cash equivalents in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline. Our quarterly operating results may fluctuate significantly.
These investments may not yield a favorable return to our stockholders. If we do not invest or apply our cash 41 and cash equivalents in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline. Our quarterly operating results may fluctuate significantly.
In addition, the amended and restated certificate of incorporation and bylaws provide that, to the fullest extent permitted by law, claims made under the Securities Act must be brought in federal district court. 47 In March 2020, the Delaware Supreme Court issued a decision in Salzburg et al. v.
In addition, the amended and restated certificate of incorporation and bylaws provide that, to the fullest extent permitted by law, claims made under the Securities Act must be brought in federal district court. In March 2020, the Delaware Supreme Court issued a decision in Salzburg et al. v.
As a result, we cannot be certain that any patent applications that we file will issue, or that our issued patents will afford protection against competitors with similar technology. In addition, our competitors 30 may design around our issued patents, which may adversely affect our business, prospects, financial condition or operating results.
As a result, we cannot be certain that any patent applications that we file will issue, or that our issued patents will afford protection against competitors with similar technology. In addition, our competitors may design around our issued patents, which may adversely affect our business, prospects, financial condition or operating results.
Any failure by us to develop new or enhanced V2G technologies and services to react to changes in existing technologies and standards could materially delay the introduction and adoption of V2G technology and services, which could result in the loss of competitiveness of our V2G platform, decreased revenue and a loss of market share to competitors.
Any failure by us to further develop new or enhanced V2G technologies and services to react to changes in existing technologies and standards could materially delay the introduction and adoption of V2G technology and services, which could result in the loss of competitiveness of our V2G platform, decreased revenue and a loss of market share to competitors.
Once a customer has installed our's or a partner’s charging stations and subscribed to our services, station owners and drivers will rely on us and our partners to provide support services to resolve any issues that might arise in the future. Rapid and high-quality customer support is important.
Once a customer has installed our or a partner’s charging stations and subscribed to our services, station owners and drivers will rely on us and our partners to provide support services to resolve any issues that might arise in the future. Rapid and high-quality customer support is important.
In addition, in the past, following periods of volatility in the overall market and the market price of a particular company’s securities, securities 46 class action litigation has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources.
In addition, in the past, following periods of volatility in the overall market and the market price of a particular company’s securities, securities class action litigation has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources.
Even if we are able to keep pace with changes in technology and develop new products and services, our research and development expenses could increase, our gross margins could be adversely affected in some periods and our prior products could become obsolete more quickly than expected.
Even if we are able to keep pace with changes in technology and develop new products and 33 services, our research and development expenses could increase, our gross margins could be adversely affected in some periods and our prior products could become obsolete more quickly than expected.
If customers do not renew their contracts, if they renew on less favorable terms, or if they fail to add products or services, our business and operating results will be adversely affected. If we fails to offer high-quality support to station owners and drivers, our business and reputation will suffer.
If customers do not renew their contracts, if they renew on less favorable terms, or if they fail to add products or services, our business and operating results will be adversely affected. If we fail to offer high-quality support to station owners and drivers, our business and reputation will suffer.
The estimated addressable market may not materialize for many years, if ever, and even if the markets meet the size estimates and growth forecasted in this report on Form 10-K, our business could fail to grow at similar rates.
The estimated addressable market may not materialize for many years, if ever, and even if the markets meet the size estimates and growth forecasted in this Annual Report on Form 10-K, our business could fail to grow at similar rates.
Furthermore, our software platform is complex, developed for over two decades by many developers, and includes a number of licensed third-party commercial and open-source software libraries. Our software has contained defects and errors and may in the future contain undetected defects or errors.
Furthermore, our software platform is complex, developed over two decades by many developers, and includes a number of licensed third-party commercial and open-source software libraries. Our software has contained defects and errors and may in the future contain undetected defects or errors.
U.S. GAAP is subject to interpretation by the Financial Accounting Standards Board (“FASB”), the SEC and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on reported financial results.
GAAP. 43 U.S. GAAP is subject to interpretation by the Financial Accounting Standards Board (“FASB”), the SEC and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on reported financial results.
For example, the California and Hawaii Public Utilities Commissions requires the activation of some advanced inverter functionality to head off presumed grid reliability issues, which 24 may require more expensive equipment and more oversight of the physical connection to the electrical grid over time.
For example, the California and Hawaii Public Utilities Commissions requires the activation of some advanced inverter functionality to head off presumed grid reliability issues, which may require more expensive equipment and more oversight of the physical connection to the electrical grid over time.
Products and services 34 we provide to customers also carry cybersecurity risks, including risks that they could be breached or fail to detect, prevent or combat attacks, which could result in losses to our customers and claims against us, and could harm our relationships with our customers.
Products and services we provide to customers also carry cybersecurity risks, including risks that they could be breached or fail to detect, prevent or combat attacks, which could result in losses to our customers and claims against us, and could harm our relationships with our customers.
Delisting from the Nasdaq Capital Market or the possibility of such delisting, may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities, and may negatively affect the value and liquidity of our common stock.
Delisting from the Nasdaq Capital Market or the possibility of such delisting, may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our 48 securities, and may negatively affect the value and liquidity of our common stock.
However, the measures we take to protect our intellectual property from unauthorized use by others may not be effective for various reasons, including the following: • any patent applications we submits may not result in the issuance of patents; • the scope of our issued patents may not be broad enough to protect our proprietary rights; • our issued patents may be challenged and/or invalidated by our competitors; • the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make aggressive enforcement impracticable; • current and future competitors may circumvent our patents; and • our in-licensed patents, if any, may be invalidated, or the owners of these patents may breach their license arrangements.
However, the measures we take to protect our intellectual property from unauthorized use by others may not be effective for various reasons, including the following: • any patent applications we submit may not result in the issuance of patents; • the scope of our issued patents may not be broad enough to protect our proprietary rights; • our issued patents may be challenged and/or invalidated by our competitors; • the costs associated with enforcing patents, confidentiality and invention agreements or other intellectual property rights may make aggressive enforcement impracticable; • current and future competitors may circumvent our patents; and • our in-licensed patents, if any, may be invalidated, or the owners of these patents may breach their license arrangements.
Acquisitions could also result in the use of cash, potentially dilutive issuances of equity securities, the 26 occurrence of goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business.
Acquisitions could also result in the use of cash, potentially dilutive issuances of equity securities, the occurrence of goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business.
Such intellectual property rights could be awarded to a third party, and we could be required to obtain a license from such third party to commercialize our technology or products, which may not be available on commercially reasonable terms or at all.
Such intellectual property rights could be awarded to a third party, and we could be required to obtain a license from such third a party to commercialize our technology or products, which may not be available on commercially 36 reasonable terms or at all.
Additionally, other foreign 37 governing bodies may enact changes to their tax laws in reaction to the Tax Act that could result in changes to our global tax position and materially adversely affect our business and future profitability.
Additionally, other foreign governing bodies may enact changes to their tax laws in reaction to the Tax Act that could result in changes to our global tax position and materially adversely affect our business and future profitability.
We may be exposed to ongoing legal risks related to CCPA and any amendments that may be made in connection with the California Privacy Rights Act approved by voters in the November 2020 election.
We may be exposed to ongoing legal risks related to CCPA 46 and any amendments that may be made in connection with the California Privacy Rights Act approved by voters in the November 2020 election.
In general, an “ownership 38 change” will occur if there is a cumulative change in ownership by “5% shareholders” that exceeds 50 percentage points over a rolling three-year period.
In general, an “ownership change” will occur if there is a cumulative change in ownership by “5% shareholders” that exceeds 50 percentage points over a rolling three-year period.
Therefore, our intellectual property rights may not be as strong or as easily enforced outside of the United States. We may not be able to protect our intellectual property and proprietary rights throughout the world.
Therefore, our intellectual property rights may not be as strong or as easily enforced outside of the United States. 34 We may not be able to protect our intellectual property and proprietary rights throughout the world.
The rights of holders of our preferred stock that may be issued could be superior to the rights of holders of our common stock. The designation and issuance of shares of capital stock having preferential rights could adversely affect other rights appurtenant 45 to shares of the common stock.
The rights of holders of our preferred stock that may be issued could be superior to the rights of holders of our common stock. The designation and issuance of shares of capital stock having preferential rights could adversely affect other rights appurtenant to shares of the common stock.
Alternatively, if a court were to find the choice of forum provision contained in the amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition. 48 Item 1B. Unresolved Staff Comments None.
Alternatively, if a court were to find the choice of forum provision contained in the amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition. 51 Item 1B. Unresolved Staff Comments None.
While we are able to access the grid services market in multiple locations, it is essential that we expand the number of services we are able to perform and the locations in which we performs them.
While we are able to access the grid services market in multiple locations, it is essential that we expand the number of services we are able to perform and the locations in which we perform them.
As such, we will be eligible for and intend to take advantage of certain exemptions from various reporting requirements 39 applicable to other public companies that are not emerging growth companies, for as long as we continues to be an emerging growth company, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
As such, we will be eligible for and intend to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, for as long as we continue to be an emerging growth company, including (a) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements.
Unless such cash flow levels are achieved, we may need to borrow additional funds or sell our debt or equity securities, or some combination of both, to provide funding for our operations. Such additional funding may not be available on commercially reasonable terms, or at all. We expect to invest in growth for the foreseeable future.
Unless such cash flow levels are achieved, we may need to borrow additional funds or equity securities, or some combination of both, to provide funding for our operations. Such additional funding may not be available on commercially reasonable terms, or at all. We expect to invest in growth for the foreseeable future.
Our business is subject to risks associated with construction, cost overruns and delays, and other contingencies that may arise in the course of completing installations, and such risks may increase in the future as we expands the scope of such services with other parties. We do not typically install charging stations at customer sites.
Our business is subject to risks associated with construction, cost overruns and delays, and other contingencies that may arise in the course of completing installations, and such risks may increase in the future as we expand the scope of such services with other parties. We do not typically install charging stations at customer sites.
To manage growth in operations and personnel, we will need to continue to improve our operational, financial and management controls and reporting systems and procedures.
To manage growth in operations and 26 personnel, we will need to continue to improve our operational, financial and management controls and reporting systems and procedures.
Although we has contractual protections, such as warranty disclaimers and limitation of liability provisions, in many of our agreements with customers and other business partners, such protections may not be uniformly implemented in all contracts and, where implemented, may not fully or effectively protect from claims by customers, reseller, business partners or other third parties.
Although we have contractual protections, such as warranty disclaimers and limitation of liability provisions, in many of our agreements with customers and other business partners, such protections may not be uniformly implemented in all contracts and, where implemented, may not fully or effectively protect from claims by customers, reseller, business partners or other third parties.
Our future growth depend on penetrating new markets, adapting existing products to new applications and customer requirements, and introducing new products that achieve market acceptance. We plan to incur significant research and development costs in the future as part of our efforts to design, develop, manufacture, and introduce new products and enhance existing products.
Our future growth depends on penetrating new markets, adapting existing products to new applications and customer requirements, and introducing new products that achieve market acceptance. We plan to incur significant research and development costs in the future as part of our efforts to design, develop, manufacture, and introduce new products and enhance existing products.
Business • the fact that we conduct a portion of our operations through subsidiaries and entities in which we may not have 100% ownership interest exposes us to risks and uncertainties; • our early stage of development, our history of net losses, and our expectation for losses to continue in the future; • our ability to manage growth effectively; • our reliance on charging station manufacturing and other partners; • existing and future competition in the EV charging market; • risks associated with installation of charging stations • our ability to increase sales of its products and services, especially to fleet operators, • our participation in the energy markets; • the interconnection of our GIVe™️ platform to the electrical grid; • significant payments under the agreement pursuant which we acquired certain of our key patents; • our international operations, including related tax, compliance, market and other risks; • our ability to attract and retain key employees and hire qualified management, technical and vehicle engineering personnel; • inexperience of our management in operating a public company; • acquisitions by us of other businesses; EV Market • the improvement of technologies that affect the demand for EVs; • changes to fuel economy standards; • the rate of adoption of EVs; • the availability of rebates, tax credits and other financial incentives; • the rate of technological change in the industry; • the accuracy of market opportunity and market growth forecasts; Technology, Intellectual Property and Infrastructure • our ability to protect our intellectual property rights; • our ability to obtain patents; • our use of third-party software • our use of open source software • the possibility we will become subject to infringement claims; • our investment in research and development; • the existence of undetected defects, errors or bugs in its hardware or software; • interruptions, delays in service or inability to increase capacity at third-party data center facilities; • the occurrence of cyber security breaches including computer malware, viruses, ransomware, hacking or phishing attacks or similar disruptions; 18 Customers • the renewal of customer service contracts; • our ability to offer high-quality support to customers; • our reliance on a limited number of customers; • our ability to expand our sales and marketing capabilities; • our ability to leverage customer data in our research and development operations; Financial, Tax and Accounting Matters • the fact that certain of our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results; • our ability to raise additional funds when needed; • the effective allocation of our cash and cash equivalents; • fluctuations in our quarterly operating results; • the effect of U.S. tax laws and regulations generally, and changes to such laws and regulations; • the effect of any changes in U.S.
Business • the fact that we conduct a portion of our operations through subsidiaries and entities in which we may not have 100% ownership interest exposes us to risks and uncertainties; • our early stage of development, our history of net losses, and our expectation for losses to continue in the future; • our ability to manage growth effectively; • our reliance on charging station manufacturing and other partners; • existing and future competition in the EV charging market; • risks associated with installation of charging stations; • our ability to increase sales of our products and services, especially to fleet operators; • our participation in the energy markets; • the interconnection of charging infrastructure being aggregated and controlled by our GIVe platform to the electrical grid; • required payments under the agreement pursuant which we acquired certain of our key patents; • our international operations, including related tax, compliance, market and other risks; • our ability to attract and retain key employees and hire qualified management, technical and vehicle engineering personnel; • limited experience of our management in operating a public company; EV Market • the improvement of technologies that affect the demand for EVs; • changes to fuel economy standards; • the rate of adoption of EVs; • the availability of rebates, tax credits and other financial incentives; • the rate of technological change in the industry; • the accuracy of market opportunity and market growth forecasts; Technology, Intellectual Property and Infrastructure • our ability to protect our intellectual property rights; • our ability to obtain patents; • our use of third-party software; • our use of open source software; • the possibility we will become subject to infringement claims; • our investment in research and development; • the existence of undetected defects, errors or bugs in charging stations hardware or software; • interruptions, delays in service or inability to increase capacity at third-party data center facilities; • the occurrence of cyber security breaches including computer malware, viruses, ransomware, hacking or phishing attacks or similar disruptions; 23 Customers • the renewal of customer service contracts; • our ability to offer high-quality support to customers; • our reliance on a limited number of customers; • our ability to expand our sales and marketing capabilities; • our ability to leverage customer data in our research and development operations; Financial, Tax and Accounting Matters • the fact that certain of our warrants are accounted for as liabilities and the changes in value of our warrants could have a material effect on our financial results; • our ability to raise additional funds when needed; • the effective allocation of our cash and cash equivalents; • fluctuations in our quarterly operating results; • the effect of tax laws and regulations generally, and changes to such laws and regulations; • the effect of any changes in U.S.
We face significant risks if we fails to comply with the FCPA and other anti-corruption laws that prohibit companies and their employees and third-party intermediaries from promising, authorizing, offering, or providing, directly or indirectly, improper payments or benefits to foreign government officials, political parties, and private-sector recipients for the purpose of obtaining or retaining business, directing business to any person, or securing any advantage.
We face significant risks if we fail to comply with the FCPA and other anti-corruption laws that prohibit companies and their employees and third-party intermediaries from promising, authorizing, offering, or providing, directly or 47 indirectly, improper payments or benefits to foreign government officials, political parties, and private-sector recipients for the purpose of obtaining or retaining business, directing business to any person, or securing any advantage.
These factors include: • actual or anticipated fluctuations in operating results; • failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public; • issuance of new or updated research or reports by securities analysts or changed recommendations for our stock or the transportation industry in general; • announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • operating and share price performance of other companies that investors deem comparable to us; • our focus on long-term goals over short-term results; • the timing and magnitude of our investments in the growth of it business; • actual or anticipated changes in laws and regulations affecting our business; • additions or departures of key management or other personnel; • disputes or other developments related to our intellectual property or other proprietary rights, including litigation; • our ability to market new and enhanced products and technologies on a timely basis; • sales of substantial amounts of the common stock by executive officers, directors or significant stockholders or the perception that such sales could occur; • changes in our capital structure, including future issuances of securities or the incurrence of debt; • the impact of the COVID-19 pandemic and the response of governments and business to the pandemic; and • general economic, political and market conditions.
These factors include: 49 • actual or anticipated fluctuations in operating results; • failure to meet or exceed financial estimates and projections of the investment community or that we provide to the public; • issuance of new or updated research or reports by securities analysts or changed recommendations for our stock or the transportation industry in general; • announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; • operating and share price performance of other companies that investors deem comparable to us; • our focus on long-term goals over short-term results; • the timing and magnitude of our investments in the growth of it business; • actual or anticipated changes in laws and regulations affecting our business; • additions or departures of key management or other personnel; • disputes or other developments related to our intellectual property or other proprietary rights, including litigation; • our ability to market new and enhanced products and technologies on a timely basis; • sales of substantial amounts of the common stock by executive officers, directors or significant stockholders or the perception that such sales could occur; • changes in our capital structure, including future issuances of securities or the incurrence of debt; and • general economic, political and market conditions.
Because our competitors’ platforms are less advanced in providing V2G services, we believe we faces limited direct competition. However, our competitors are developing sales relationships with the same fleet managers, and especially new electric fleet managers, as us.
Because our competitors’ platforms are less advanced in providing V2G services, we believe we face limited direct competition. However, our competitors are developing sales relationships with the same fleet managers, and especially new electric fleet managers, as us.
The standards required for a public company under Section 404(a) of the Sarbanes-Oxley Act are significantly more stringent than those required of us as a private company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that are now applicable after the Business Combination.
The standards required for a public company under Section 404(a) of the Sarbanes-Oxley Act are significantly more stringent than those required of a private company. Management may not be able to effectively and timely implement controls and procedures that adequately 44 respond to the increased regulatory compliance and reporting requirements that are now applicable after the Business Combination.
We presently holds a 13% interest in Dreev. The parties have certain put and call option rights under the agreements for the business venture, including a call option for each party upon a change in control of the other party.
We presently hold a 13% interest in Dreev. The parties have certain put and call option rights under the agreements for the business venture, including a call option for each party upon a change in control of the other party.
Certain estimates of market opportunity and forecasts of market growth included in this report on Form 10-K may prove to be inaccurate. This annual report on Form 10-K includes estimates of the addressable market for our solutions and the EV market in general.
Certain estimates of market opportunity and expectations of market growth included in this report on Form 10-K may prove to be inaccurate. This Annual Report on Form 10-K includes estimates of the addressable market for our solutions and the EV market in general.
Any acquisitions or strategic investments may also require us to issue additional equity securities, spend our cash, or incur debt (and increased interest expense), liabilities, and amortization expenses related to intangible assets or write-offs of goodwill, which could adversely affect our results of operations and dilute the economic and voting rights of our stockholders.
Any acquisitions or strategic investments may also require us to issue additional equity securities, spend our cash, or incur debt (and increased interest expense), liabilities, and amortization expenses related to intangible assets, which could adversely affect our results of operations and dilute the economic and voting rights of our stockholders.
Interconnection limits or circuit-level caps imposed by regulators may curb our growth in key markets. Utilities throughout the country have different rules and regulations regarding interconnection and some utilities cap or limit the amount of energy from various sources that can be interconnected to the grid.
Interconnection limits and long backlogs interconnection queues or circuit-level caps imposed by regulators may curb our growth in key markets. Utilities throughout the country have different rules and regulations regarding interconnection and some utilities cap or limit the amount of energy from various sources that can be interconnected to the grid.
The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, particularly those relating to biotechnology products, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our intellectual property and proprietary rights generally.
The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets, and other intellectual property protection, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our intellectual property and proprietary rights generally.
Decreases in the retail prices of electricity from the utility grid would make it more difficult for our solutions to compete. In particular, growth in unconventional natural gas production and an increase in global liquefied natural gas capacity are expected to keep natural gas prices relatively low for the foreseeable future.
Decreases in the retail prices of electricity from the utility grid would make it more difficult for our solutions to compete. In particular, growth in unconventional natural gas production and an increase in global liquefied natural gas capacity may keep natural gas prices relatively low for the foreseeable future.
In the ordinary course of our business, we collect and stores sensitive data, including, among other things, personally identifiable information about our employees, intellectual property, and proprietary business information.
In the ordinary course of our business, we collect and store sensitive data, including, among other things, personally identifiable information about our employees, intellectual property, and proprietary business information.
If our revenue grows slower than it anticipates, or if our operating expenses are higher than we expect, we may not be able to achieve profitability and our financial condition could suffer. We can give no assurance that we will ever achieve profitable operations.
If our revenue grows slower than we anticipate, or if our operating expenses are higher than we expect, we may not be able to achieve profitability and our financial condition could suffer. We can give no assurance that we will ever achieve profitable operations.
Our failure to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act could have a material adverse effect on our business. As a public company, we will be required to provide management’s attestation on internal controls.
Our failure to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act could have a material adverse effect on our business. As a public company, we are required to provide management’s attestation on internal controls.
Consequently, any assessment you make about our current business or future success or viability may not be as accurate as they could be if we had a longer operating history and had been able to reduce some of the uncertainties set forth elsewhere in this annual report.
Consequently, any assessment you make about our current business or future success or viability may not be as accurate as they could be if we had a longer operating history and had been able to reduce some of the uncertainties set forth elsewhere in this Annual Report on Form 10-K.
We currently faces competition from a number of companies, and expects to face significant competition in the future as the market for EV charging develops. The EV charging market as a whole is relatively new and competition is still developing.
We currently face competition from a number of companies, and expect to face significant competition in the future as the market for EV charging develops. The EV charging market as a whole is relatively new and competition is still developing.
We are party to an intellectual property acquisition agreement (“IP Acquisition Agreement”) with the University of Delaware, pursuant to which we acquired certain of the key patents underlying our V2G technology. The university beneficially owns approxim ately 6.9% of o ur outstanding common stock.
We are party to an intellectual property acquisition agreement (“IP Acquisition Agreement”) with the University of Delaware, pursuant to which we acquired certain of the key patents underlying our V2G technology. The university beneficially owns approxim ately 0.7% of o ur outstanding common stock.
Our research and 33 development expenses were $8.0 million and $6.5 million during the years ended December 31, 2022 and 2021, respectively, and such expenses are likely to grow in the future. Further, our research and development program may not produce successful results, and our new products may not achieve market acceptance, create additional revenue, or become profitable.
Our research and development expenses were $8.8 million and $8.0 million during the years ended December 31, 2023 and 2022, respectively, and such expenses are likely to grow in the future. Further, our research and development program may not produce successful results, and our new products may not achieve market acceptance, create additional revenue, or become profitable.
Some of Our products contain open-source software, which may pose particular risks to its proprietary software, products and services in a manner that could harm its business. We use open-source software in its products and anticipates using open-source software in the future.
Some of Our products may contain open-source software, which may pose particular risks to its proprietary software, products and services in a manner that could harm its business. 35 We may use open-source software in our products and anticipate possibly using open-source software in the future.
GAAP; • the expense and administrative burden of being a public company; • our ability to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act; • the existence of identified material weaknesses in our internal control over financial reporting; Legal and Regulatory Matters • electric utility statutes and regulations and changes to such statutes or regulations; • privacy concerns and laws; • accounting, legal and regulatory requirements for public companies • anticorruption and anti-money laundering laws, including the Foreign Corrupt Practices Act (“FCPA”); • laws relating to employment; • existing and future environmental, health and safety laws and regulations; Ownership of Our Securities • our ability to maintain compliance with the Nasdaq Stock Market’s listing requirements; • concentration of ownership among our officers, directors and their affiliates; • future sales of a substantial number of shares of our Common Stock in the public market; • our ability to issue common and preferred stock without further stockholder approval; • the absence of cash dividends in the future; • our warrants may expire worthless; • volatility in the trading price of our securities; • analyst coverage of our securities; • anti-takeover provisions in our governing documents; and • the exclusive forum selection clause in our governing documents. 19 Risks Related to Our Business Conducting a portion of our operations through joint ventures and other subsidiaries and entities in which we may not have 100% ownership interest exposes us to risks and uncertainties, many of which are outside of our control.
GAAP; • the expense and administrative burden of being a public company; • our ability to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act; Legal and Regulatory Matters • electric utility statutes and regulations and changes to such statutes or regulations; • privacy concerns and laws; • accounting, legal and regulatory requirements for public companies; • anticorruption and anti-money laundering laws, including the Foreign Corrupt Practices Act (“FCPA”); • laws relating to employment; • existing and future environmental, health and safety laws and regulations; Ownership of Our Securities • our ability to maintain compliance with the Nasdaq Stock Market’s listing requirements; • future sales of a substantial number of shares of our Common Stock in the public market; • our ability to issue common and preferred stock without further stockholder approval; • the absence of cash dividends in the future; • volatility in the trading price of our securities; • analyst coverage of our securities; • anti-takeover provisions in our governing documents; and • the exclusive forum selection clause in our governing documents. 24 Risks Related to Our Business Conducting a portion of our operations through joint ventures and other subsidiaries and entities in which we may not have 100% ownership interest exposes us to risks and uncertainties, many of which are outside of our control.
As a result, included on our consolidated balance sheet as of December 31, 2022, contained elsewhere in this Annual Report, is a derivative liability related to the private placement warrants due to certain features embedded in the private placement warrants.
As a result, included on our consolidated balance sheet as of December 31, 2023, contained elsewhere in this Annual Report on Form 10-K, is a derivative liability related to the private placement warrants due to certain features embedded in the private placement warrants.
Compliance with public company requirements will increase costs and make certain activities more time-consuming. A number of those requirements require us to carry out activities in which we have not engaged previously. For example, we have created new board committees and have adopted new internal controls and disclosure controls and procedures.
Compliance with public company requirements will increase costs and make certain activities more time-consuming. A number of those requirements require us to carry out activities in which we have not engaged previously. For example, we created board committees and have adopted new internal controls and disclosure controls and procedures. In addition, expenses associated with SEC reporting requirements will be incurred.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to revenue recognition, allowance for doubtful accounts, inventory reserves, impairment of goodwill, indefinite-lived and long-lived assets, pension and other post-retirement benefits, product 43 warranty, valuation allowances for deferred tax assets, valuation of common stock warrants, and share-based compensation.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to revenue recognition, allowance for doubtful accounts, inventory reserves, impairment of indefinite-lived and long-lived assets, product warranty, valuation allowances for deferred tax assets, valuation of common stock warrants, and share-based compensation.
We have not yet achieved profitability and have experienced substantial net losses, and we expect to continue to incur substantial losses for the foreseeable future. We incurred operating losses of approximately $36.9 million and $27.2 million for the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, we had an accumulated deficit of approximately $117.0 million.
We have not yet achieved profitability and have experienced substantial net losses, and we expect to continue to incur substantial losses for the foreseeable future. We incurred operating losses of approximately $32.1 million and $36.9 million for the years ended December 31, 2023 and 2022, respectively. As of December 31, 2023, we had an accumulated deficit of approximately $148.2 million.
The business venture may not be successful in penetrating this market, as a result of a failure by our partner to prioritize the project or as a result of competition by other competitors in the European market. In such event, we may not receive a return of our investment, which could have an adverse effect on our financial condition.
We may not have sufficient resources to be successful in penetrating this market, as a result of a failure by our business development efforts, or as a result of competition by other competitors in the European market. In such event, we may not receive a return of our investment, which could have an adverse effect on our financial condition.
The exercise price for the pre-merger warrants is $11.50 per whole share, and the exercise prices for the Levo warrants range from $10.00 per share to $40.00 per share. There is no guarantee that our warrants will be in the money prior to their expiration, and as such, our warrants may expire worthless.
The exercise price for the pre-merger warrants is $460.00 per whole share, and the exercise prices for the Levo warrants range from $400.00 per share to $1,600.00 per share. There is no guarantee that our warrants will be in the money prior to their expiration, and as such, our warrants may expire worthless.
Furthermore, in the event of a material breach of certain limited provisions of the IP Acquisition Agreement (which do not include the milestone payment provisions) that is not cured within 45 days after notice from the university, we may be required to assign the patents back to the university.
These payments will reduce our cash flow and profits. Furthermore, in the event of a material breach of certain limited provisions of the IP Acquisition Agreement (which do not include the milestone payment provisions) that is not cured within 45 days after notice from the university, we may be required to assign the patents back to the university.
In addition, investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire financing on acceptable terms or at all.
Termination of cash management arrangements and/or delays in accessing or actual loss of funds subject to cash management arrangements. 45 In addition, investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us to acquire financing on acceptable terms or at all.
In such event, we may be unable to realize all of the benefits of the development of the V2G technology. We operates internationally, and expects to continue to expand its international operations, which will expose Nuvve to additional tax, compliance, market and other risks.
In such event, we may be unable to realize all of the benefits of the development of the V2G technology. We operate internationally, and expect to continue to expand our international operations, which will expose us to additional tax, compliance, market and other risks.
We currently serve customers from third-party data center facilities operated by Amazon Web Services (“AWS”) located in the United States, Europe, and Japan. Our primary environment is AWS Cloudwatch, although it uses other systems as well. Any outage or failure of such data centers or other interruptions of AWS’ services could negatively affect our product connectivity and performance.
We currently serve customers from third-party data center facilities operated by Amazon Web Services (“AWS”) located in the United States, Europe, and Japan. Any outage or failure of such data centers or other interruptions of AWS’ services could negatively affect our product connectivity and performance.
Under this IP Acquisition Agreement, upon achieving certain substantial commercialization milestones, we may be required to make up to $7,500,000 in royalty payments to the University of Delaware. We also are required to pay the University of Delaware a minimum of $400,000 per year under a research agreement. These payments will reduce our cash flow and profits.
Under this IP Acquisition Agreement, upon achieving certain substantial commercialization milestones, we may be required to make up to $7,500,000 in royalty payments to the University of Delaware. We also are required to pay the University of Delaware a minimum of $400,000 per year under a research agreement subject to achievement of certain milestones.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties Our principal executive offices are located in leased office space at 2488 Historic Decatur Rd., Suite 200, San Diego, California. We also maintains office space, operations and equipment storage facilities in San Diego, Michigan, Denmark, France and the United Kingdom. We do not own any real property.
Biggest changeItem 2. Properties Our principal executive offices are located in leased office space at 2488 Historic Decatur Rd., Suite 200, San Diego, California. We also maintains office space, operations and equipment storage facilities in San Diego, Michigan, Denmark, and the United Kingdom. We do not own any real property.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn addition, regardless of the outcome, such proceedings or claims can have an adverse impact on us because of defense and settlement costs, diversion of resources and other factors. Please see Note 17 Commitments and Contingencies, of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for details. Item 4.
Biggest changeThe Settlement Agreement further provides for the dismissal of the legal action as to us and Rhombus. We and Rhombus agreed to release one another from any and all claims relating to the Dispute. Please see Note 17 Commitments and Contingencies, of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K for details. Item 4.
Mine Safety Disclosures Not applicable. 49 Part II
Mine Safety Disclosures Not applicable. 54 Part II
Removed
For example, Rhombus Energy Solutions, Inc., a BorgWarner Company (“Rhombus”), has filed a demand for arbitration for breach of contract. Rhombus has alleged the Company failed to pay certain purchase orders for D.C. electric vehicle chargers (“V2G Chargers”) totaling $5,026,560.00.
Added
For example, o n July 20, 2021, we issued a purchase order (“PO”) to our supplier, Rhombus Energy Solutions, Inc. (“Rhombus”), for a quantity of DC Chargers and dispensers for EVs (“DC Chargers”), for a total price of $13.2 million. As previously disclosed, a dispute (the "Dispute") arose as to the PO, and an arbitration proceeding was initiated.
Removed
In response, the Company has asserted counterclaims for breach of express warranty, fraudulent inducement (misrepresentation), fraudulent inducement (concealment), violation of California’s Business and Professions Code § 17200, promissory estoppel, and unjust enrichment.
Added
On February 2, 2024 (the “Settlement Date”), we and Rhombus entered into a settlement and release agreement (the “Settlement Agreement”) pursuant to which, among other things, we agreed to pay Rhombus approximately $0.46 million for certain initial DC Chargers within 15 days from the Settlement Date.
Removed
The Company has alleged Rhombus fraudulently induced the Company into the purchase of the V2G Chargers by both omitting certain facts including but not limited to Rhombus’ inability to develop, commission, maintain, and service the technology necessary to provide V2G Chargers conforming to those promised under the parties’ contract.
Added
We further agreed to pay Rhombus an aggregate of $2.4 million for certain DC Chargers upon shipment with payments correlating to the amounts shipped due prior to shipment, a minimum of 50% of which shall be paid within 12 months after the Settlement date, with the remaining balance, if any, to be paid within 24 months after the Settlement Date.
Removed
Rhombus and the Company are actively engaged in discovery and are attempting to agree on ESI search terms. A final arbitration hearing date has not yet been set, but we expect it to be scheduled for the fourth quarter of 2023.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeHolders As of March 21, 2023, there were approximately 74 shareholders of record of our common stock, which does not include the number of shareholders that hold shares in “street name” through banks or broker-dealers. Dividends We have not paid any cash dividends on our common stock to date.
Biggest changeHolders As of March 21, 2024, there were approximately 28 shareholders of record of our common stock, which does not include the number of shareholders that hold shares in “street name” through banks or broker-dealers. Dividends We have not paid any cash dividends on our common stock to date.
Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters And Issuer Purchases Of Equity Securities. Market Information Our common stock and pre-merger warrants trade on the NASDAQ Stock Market under the symbols “NVVE" and "NVVEW", respectively.
Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters And Issuer Purchases Of Equity Securities. Market Information Our common stock and pre-merger warrants trade on the Nasdaq Capital Market under the symbols “NVVE" and "NVVEW", respectively.
In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur. We do not anticipate declaring any cash dividends to holders of the common stock in the foreseeable future. Unregistered Sales of Equity Securities and Use of Proceeds None Item 6. Reserved 50
In addition, our ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness we or our subsidiaries incur. We do not anticipate declaring any cash dividends to holders of the common stock in the foreseeable future. Unregistered Sales of Equity Securities and Use of Proceeds None Item 6. Reserved 55

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYears Ended December 31, Period-over-Period Change 2022 2021 Change ($) Change (%) Revenue Products and services $ 4,913,956 $ 2,920,627 $ 1,993,329 68.3 % Grants 459,427 1,270,138 (810,711) (63.8) % Total revenue 5,373,383 4,190,765 1,182,618 28.2 % Operating expenses Cost of product and service revenue 4,196,788 2,002,197 2,194,591 109.6 % Selling, general and administrative expenses 30,115,571 22,896,125 7,219,446 31.5 % Research and development expense 7,976,568 6,524,245 1,452,323 22.3 % Total operating expenses 42,288,927 31,422,567 10,866,360 34.6 % Operating loss (36,915,544) (27,231,802) (9,683,742) 35.6 % Other income (expense) Interest income (expense) 134,579 (585,157) 719,736 (123.0) % Financing costs — (46,754,794) 46,754,794 100.0 % Change in fair value of private warrants liability 11,986,462 (312,400) 12,298,862 (3,936.9) % Change in fair value of derivative liability 152,723 (14,342) 167,065 NM Other, net 85,074 282,183 (197,109) (69.9) % Total other income (expense), net 12,358,838 (47,384,510) 59,743,348 NM Loss before taxes (24,556,706) (74,616,312) 50,059,606 -67.1 % Income tax expense 800 1,000 (200) (20.0) % Net loss $ (24,557,506) $ (74,617,312) $ 50,059,806 -67.1 % Less: Net loss attributable to non-controlling interests (538,841) (2,138,272) 1,599,431 NM Net loss attributable to Nuvve Holding Corp. $ (24,018,665) $ (72,479,040) $ 48,460,375 -66.9 % ________________ NM - Not Meaningful 55 Revenue Total revenue was $5.4 million for the year ended December 31, 2022, compared to $4.2 million for the year ended December 31, 2021, an increase of $1.2 million, or 28.2%.
Biggest changeYears Ended December 31, Period-over-Period Change 2023 2022 Change ($) Change (%) Revenue Products $ 5,843,187 $ 4,129,246 $ 1,713,941 41.5 % Services $ 2,162,218 $ 784,710 $ 1,377,508 175.5 % Grants 326,757 459,427 (132,670) (28.9) % Total revenue 8,332,162 5,373,383 2,958,779 55.1 % Operating expenses Cost of products 5,804,011 3,609,461 2,194,550 60.8 % Cost of services 1,177,333 587,327 590,006 100.5 % Selling, general and administrative expenses 24,694,693 30,115,571 (5,420,878) (18.0) % Research and development expense 8,761,400 7,976,568 784,832 9.8 % Total operating expenses 40,437,437 42,288,927 (1,851,490) (4.4) % Operating loss (32,105,275) (36,915,544) 4,810,269 (13.0) % Other income Interest income, net 108,182 134,579 (26,397) (19.6) % Change in fair value of warrants liability 216,263 11,986,462 (11,770,199) NM Change in fair value of derivative liability 49,497 152,723 (103,226) (67.6) % Other, net 436,146 85,074 351,072 412.7 % Total other income, net 810,088 12,358,838 (11,548,750) NM Loss before taxes (31,295,187) (24,556,706) (6,738,481) 27.4 % Income tax expense 1,600 800 800 100.0 % Net loss $ (31,296,787) $ (24,557,506) $ (6,739,281) 27.4 % Less: Net loss attributable to non-controlling interests (12,456) (538,841) 526,385 NM Net loss attributable to Nuvve Holding Corp. $ (31,284,331) $ (24,018,665) $ (7,265,666) 30.3 % ________________ NM - Not Meaningful 60 Revenue Total revenue was $8.3 million for the year ended December 31, 2023, compared to $5.4 million for the year ended December 31, 2022, an increase of $3.0 million, or 55.1%.
The EV market relies on these governmental rebates, tax credits, and other financial incentives to significantly lower the effective price of EVs and EV charging stations to customers. However, these incentives may expire on a particular date, end when the allocated funding is exhausted, or be reduced or terminated as a matter of regulatory or legislative policy.
The EV market relies on these governmental rebates, tax credits, and other financial incentives to 57 significantly lower the effective price of EVs and EV charging stations to customers. However, these incentives may expire on a particular date, end when the allocated funding is exhausted, or be reduced or terminated as a matter of regulatory or legislative policy.
Stock-based compensation We grant stock options to employees and non-employees. Determining the grant date fair value of options using the Black-Scholes option-pricing model requires management to make certain assumptions and judgments. These estimates involve inherent uncertainties, and, if different assumptions had been used, stock-based compensation expense could have been materially different from the amounts recorded.
Share-based compensation We grant stock options to employees and non-employees. Determining the grant date fair value of options using the Black-Scholes option-pricing model requires management to make certain assumptions and judgments. These estimates involve inherent uncertainties, and, if different assumptions had been used, stock-based compensation expense could have been materially different from the amounts recorded.
Our GIVe software platform was created to harness capacity from “loads” at the edge of the distribution grid (i.e., aggregation of EVs and small stationary batteries) in a qualified, controlled and secure manner to provide many of the grid services offered by conventional generation sources (i.e., coal and natural gas plants).
Our GIVe software platform was created to harness capacity from “loads” at the edge of the distribution grid (i.e., aggregation of EVs and small stationary batteries) in a qualified, controlled and secure manner to provide many of the grid services typically offered by conventional generation sources (i.e., coal and natural gas plants).
Market Opportunity We see a significant market opportunity for V2G, totaling approximately over $6 trillion and our management believes it is well positioned to capture this global opportunity for a variety of reasons: • First, our intellectual property ("IP") includes key patents, making it difficult for competitors to perform V2G functions without violating our IP.
Market Opportunity We see a significant market opportunity for V2G, totaling approximately over $6 trillion and our management believes it is well positioned to capture this global opportunity for a variety of reasons: • First, our intellectual property includes key patents, making it difficult for competitors to perform V2G functions without violating our intellectual property.
If these programs are modified, reduced or eliminated, our ability to generate this revenue in the future could be 53 adversely impacted. While we have derived an immaterial percentage of other revenue from these regulatory credits, we expect revenue from this source as a percentage of revenue to increase over time.
If these programs are modified, reduced or eliminated, our ability to generate this revenue in the future could be adversely impacted. While we have derived an immaterial percentage of other revenue from these regulatory credits, we expect revenue from this source as a percentage of revenue to increase over time.
We will remain an emerging growth company under the JOBS Act until the earliest of (a) the last day of our first fiscal year following the fifth anniversary of Newborn’s IPO, which was consummated on February 19, 2020, (b) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (c) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years. 64 Item 7A.
We will remain an emerging growth company under the JOBS Act until the earliest of (a) the last day of our first fiscal year following the fifth anniversary of Newborn’s IPO, which was consummated on February 19, 2020, (b) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (c) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years. 70 Item 7A.
If we are unable to penetrate the market in North America and Europe, our future revenue growth and profits will be impacted. Backlog Our total backlog represents the estimated transaction prices on unsatisfied and partially satisfied performance obligations to our customers for products and services.
If we are unable to penetrate the market in North America and Europe, our future revenue growth and profits will be impacted. 58 Backlog Our total backlog represents the estimated transaction prices on unsatisfied and partially satisfied performance obligations to our customers for products and services.
Competition We offer proprietary V2G technology and services and intend to expand our market share over time in our product categories, leveraging the network effect of its V2G technology, services and GIVe software platform. Existing competitors may expand their product offerings and sales strategies, and new competitors may enter the market.
Competition We offer proprietary V2G technology and services and intend to expand our market share over time in our product categories, leveraging the network effect of our V2G technology, services and GIVe software platform. Existing competitors may expand their product offerings and sales strategies, and new competitors may enter the market.
Levo utilizes our V2G technology and committed capital from Stonepeak and Evolve to offer Fleet-as-a-Service for school buses, last-mile delivery, ride hailing and ride sharing, municipal services, and more to eliminate the primary barriers to EV fleet adoption including large upfront capital investments and lack of expertise in securing and managing EVs and associated charging infrastructure. 51 Levo's turnkey solution simplifies and streamlines electrification, can lower the total cost of EV operation for fleet owners, and support the grid when the EVs are not in use.
Levo utilizes our V2G technology and committed capital from Stonepeak and Evolve to offer Fleet-as-a-Service for school buses, last-mile delivery, ride hailing and ride sharing, municipal services, and more to eliminate the primary barriers to EV fleet adoption including large upfront capital investments and lack of expertise in securing and managing EVs and associated charging infrastructure. 56 Levo's turnkey solution simplifies and streamlines electrification, can lower the total cost of EV operation for fleet owners, and support the grid when the EVs are not in use.
When agreements involve multiple distinct performance obligations, we accounts for individual performance obligations separately if they are distinct. We apply significant judgment in identifying and accounting for each performance obligation, as a result of evaluating terms and conditions in contracts. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis.
When agreements involve multiple distinct performance obligations, we account for individual performance obligations separately if they are distinct. We apply significant judgment in identifying and accounting for each performance obligation, as a result of evaluating terms and conditions in contracts. The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis.
In an effort to mitigate unpredictable lead times, we increased our inventory orders contributing to our elevated inventory levels at the end of those periods. While we expect supply chain disruption to continue in 2023, we are planning a reduction in inventory buys, as we expect to fulfill customer demand using inventories on-hand.
In an effort to mitigate unpredictable lead times, we increased our inventory orders contributing to our elevated inventory levels at the end of those periods. While we expect supply chain disruption to continue in 2024, we are planning a reduction in inventory buys, as we expect to fulfill customer demand using inventories on-hand.
As a result of our public float being below $75 million, we will be limited by the baby shelf rules until such time as our public float exceeds $75 million, which means we only have the capacity to sell shares up to one-third of our public float under shelf registration statements in any twelve-month period.
As a result, we will be limited by the baby shelf rules until such time our public float exceeds $75 million, which means we only have the capacity to sell shares up to one-third of our public float under shelf registration statements in any twelve-month period.
Effects of Inflation As inflationary pressures continued to have negative impact on global revenue, operating margins and net income, including increased costs of labor, products and freight, it did not have a significant impact on our results of operations in the year ended December 31, 2022.
Effects of Inflation As inflationary pressures continued to have negative impact on global revenue, operating margins and net income, including increased costs of labor, products and freight, it did not have a significant impact on our results of operations in the year ended December 31, 2023.
Overview We are a green energy technology company that provides, directly and through business ventures with its partners, a globally-available, commercial V2G technology platform that enables EV batteries to store and resell unused energy back to the local electric grid and provide other grid services.
Overview We are a green energy technology company that provides, directly and through business ventures with our partners, a globally-available, commercial V2G technology platform that enables EV batteries to store and resell unused energy back to the local electric grid and provide other grid services.
At the end of each subsequent reporting period, we reevaluate the probability of achievement of all milestones subject to certain constraints, such as site preparation for EV 61 charging station installations, and, if necessary, we adjust our estimate of the overall transaction price.
At the end of each subsequent reporting period, we reevaluate the probability of achievement of all milestones subject to certain constraints, such as site preparation for EV 67 charging station installations, and, if necessary, we adjust our estimate of the overall transaction price.
Our technology originated with an academic unit at the University of Delaware starting in 1996 and not only had decades of development but tens of millions of dollars in project funding invested prior to our acquisition of the IP and commercialization of the technology. • Second, we are already qualified by multiple Transmission System Operators, which typically take anywhere from one to three years to get approval.
Our technology originated with an academic unit at the University of Delaware starting in 1996 and not only had decades of development but tens of millions of dollars in project funding invested prior to our acquisition of the intellectual property and commercialization of the technology. • Second, we are already qualified by multiple Transmission System Operators, which typically take anywhere from one to three years to get approval.
Other Income (Expense) Other income (expense) consists primarily of interest expense, financing costs, change in fair value of warrants liability and derivative liability, and other income (expense).
Other Income, net Other income, net consists primarily of interest expense, financing costs, change in fair value of warrants liability and derivative liability, and other income (expense).
The increases during the year ended December 31, 2022 were primarily attributable to hiring of engineering personnel, which resulted in increases in compensation expenses and subcontractor expenses used to advance the Company's platform functionality and integration with more vehicles.
The increases during the year ended December 31, 2023 were primarily attributable to hiring of engineering personnel, which resulted in increases in compensation expenses and subcontractor expenses used to advance the Company's platform functionality and integration with more vehicles.
Interest and penalties related to unrecognized tax benefits which, as of the date of this report, have not been material, are recognized within provision for income taxes. 63 Recent Accounting Pronouncements See Note 2 to the consolidated financial statements included elsewhere in this report for more information regarding recently issued accounting pronouncements.
Interest and penalties related to unrecognized tax benefits which, as of the date of this Annual Report, have not been material, are recognized within provision for income taxes. 69 Recent Accounting Pronouncements See Note 2 to the consolidated financial statements included elsewhere in this Annual Report for more information regarding recently issued accounting pronouncements.
See Note 2 to the consolidated financial statements included elsewhere in this report for the recent accounting pronouncements adopted and the recent accounting pronouncements not yet adopted for the year ended December 31, 2022. In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act.
See Note 2 to the consolidated financial statements included elsewhere in this Annual Report for the recent accounting pronouncements adopted and the recent accounting pronouncements not yet adopted for the year ended December 31, 2023. In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act.
Further, our global experience allows us to bring the lessons we have learned into each new region which, in turn, enables us to bring the unique experience and incredible benefits of our V2G technology to customers at a faster rate. 54 Results of Operations Year Ended December 31, 2022 Compared with Year Ended December 31, 2021 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2022 and 2021.
Further, our global experience allows us to bring the lessons we have learned into each new region which, in turn, enables us to bring the unique experience and incredible benefits of our V2G technology to customers at a faster rate. 59 Results of Operations Year Ended December 31, 2023 Compared with Year Ended December 31, 2022 The following table sets forth information regarding our consolidated results of operations for the years ended December 31, 2023 and 2022.
Backlog is converted into revenue in future periods as we satisfy the performance obligations to our customers for products and services, primarily based on the cost incurred or at delivery and acceptance of products, depending on the applicable accounting method. Our estimated backlog on December 31, 2022 was $4.1 million, which we expect to be earned in future periods.
Backlog is converted into revenue in future periods as we satisfy the performance obligations to our customers for products and services, primarily based on the cost incurred or at delivery and acceptance of products, depending on the applicable accounting method. Our estimated backlog on December 31, 2023 was $3.9 million, which we expect to be earned in future periods.
While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements included elsewhere in this report, we believe the following accounting policies and estimates to be most critical to the preparation of its consolidated financial statements.
While our significant accounting policies are described in more detail in Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K, we believe the following accounting policies and estimates to be most critical to the preparation of its consolidated financial statements.
The determination of the grant date fair value of stock option awards issued is affected by a number of variables, including the fair value of our underlying common stock, our expected common stock price volatility over the term of the option award, the expected term of the award, risk-free interest rates, and the expected dividend yield of our Common Stock. 62 The following table summarizes the weighted-average assumptions used in estimating the fair value of stock options granted during each of the periods presented: Years Ended December 31, 2022 2021 Expected life of options (in years) 6.1 6.0 Dividend yield 0 % 0 % Risk-free interest rate 2.75 % 1.02 % Expected volatility 56.2 % 60.2 % • Expected Life .
The determination of the grant date fair value of stock option awards issued is affected by a number of variables, including the fair value of our underlying common stock, our expected common stock price volatility over the term of the option award, the expected term of the award, risk-free interest rates, and the expected dividend yield of our Common Stock. 68 The following table summarizes the weighted-average assumptions used in estimating the fair value of stock options granted during each of the periods presented: Years Ended December 31, 2023 2022 Expected life of options (in years) 7.0 6.0 Dividend yield 0 % 0 % Risk-free interest rate 4.61 % 1.02 % Expected volatility 79.6 % 60.2 % • Expected Life .
The income tax expenses during the years ended December 31, 2022 and 2021 were nominal primarily due to operating losses that receive no tax benefits as a result of a valuation allowance recorded for such losses.
The income tax expenses during the years ended December 31, 2023 and 2022 were nominal primarily due to operating losses that receive no tax benefits as a result of a valuation allowance.
On April 25, 2022, we filed a shelf registration statement with the SEC which will allow us to issue unspecified amounts of common stock, preferred stock, warrants for the purchase of shares of common stock or preferred stock, debt securities, and units consisting of any combination of any of the foregoing securities, in one or more series, from time to time and in one or more offerings up to a total dollar amount of $100.0 million.
Shelf Registration On April 25, 2022, we filed a shelf registration statement with the SEC on Form S-3 which allow us, subject to limitations under the baby shelf rules discussed below, to issue unspecified amounts of common stock, preferred stock, warrants for the purchase of shares of common stock or preferred stock, debt securities, and units consisting of any combination of any of the foregoing securities, in one or more series, from time to time and in one or more offerings up to a total dollar amount of $100.0 million.
February 2023 Registered Direct Offering On February 17, 2023, we entered into a subscription agreement (the “Subscription Agreement”) with a certain institutional and accredited investor, relating to the issuance and sale of 543,478 shares of common stock in a registered direct offering (the “February 2023 Offering”). The offering price for the shares was $0.92 per share of common stock.
February 2023 Registered Direct Offering On February 17, 2023, we entered into a subscription agreement with a certain institutional and accredited investor, relating to the issuance and sale of 13,587 shares of common stock in a registered direct offering (the “February 2023 Offering”). The offering price for the shares was $36.80 per share of common stock.
We have incurred operating losses of approximately $36.9 million and $27.2 million for the years ended December 31, 2022 and 2021, respectively. Our cash used in operations were $34.1 million and $29.2 million for the years ended December 31, 2022 and 2021, respectively.
We have incurred operating losses of approximately $32.1 million and $36.9 million for the years ended December 31, 2023 and 2022, respectively. Our cash used in operations were $21.3 million and $34.1 million for the years ended December 31, 2023 and 2022, respectively.
Working capital during the year ended December 31, 2022 was impacted by, among other items, the higher net loss of $24.6 million, resulting from increases in compensation expenses, increases in professional fees related to internal operational reviews, increases in governance and other public company costs, and cash purchases to fund higher inventory levels.
Working capital during the year ended December 31, 2023 was impacted by, among other items, higher operating loss of $32.1 million, resulting from higher costs of sales, partially offset by decreases in compensation expenses, decreases in professional fees related to internal operational reviews, decreases in governance and other public company costs, and decreases in cash purchases to fund inventory levels.
From time to time during the term of the Sales Agreement, we may offer and sell shares of common stock having an aggregate offering price up to a total of $25.0 million in gross proceeds. The Agents will collect a fee equal to 3% of the gross sales price of all shares of common stock sold.
From time to time during the term of the Sales Agreement, we could offer and sell shares of common stock having an aggregate offering price up to a total of $25.0 million in gross proceeds.
As of December 31, 2022, we had a cash balance, working capital, and stockholders’ equity of $15.8 million, $24.0 million and $23.2 million, respectively. We have incurred net losses and negative cash flows from operations since our inception. We have funded our business operations primarily with the issuance of equity and convertible notes, borrowings and cash from operations.
As of December 31, 2023, we had a cash balance, working capital, and stockholders’ equity of $1.5 million, $4.7 million and $2.6 million, respectively. We have incurred net losses and negative cash flows from operations since our inception. We have funded our business operations primarily with the issuance of equity and convertible notes, and cash from operations.
January 2023 ATM Offering Program On January 31, 2023, we entered into an At the Market Offering Agreement (the “ATM Agreement”) with Craig-Hallum Capital Group LLC (“Craig-Hallum”), as the sales agent (the “Agent”), pursuant to which we may offer and sell, from time to time through the Agent, shares of its common stock (the “Shares”), having an aggregate offering price of up to $25,000,000 (the “January 2023 ATM Offering”).
The Sales Agreement terminated pursuant to its terms in June 2022. 2023 ATM Offering Program On January 31, 2023, we entered into an at-the-market Offering Agreement (the “ATM Agreement”) with Craig-Hallum, as sales agent ("Agent"), pursuant to which we could offer and sell, from time to time through the Agent shares of our common stock (the “Shares”), having an aggregate offering price of up to $25,000,000.
The $4.9 million increase in net cash used in operating activities was primarily attributable to higher use of cash for working capital during the year ended December 31, 2022 as compared to the same prior period.
The $12.8 million decrease in net cash used in operating activities was primarily attributable to lower use of cash for working capital during the year ended December 31, 2023 as compared to the same prior period.
Expenses resulting from the consolidation of Levo's activities during the year ended December 31, 2022, contributed $1.6 million to the increase in selling, general and administrative expenses.
Expenses resulting from the consolidation of Levo's activities during the year ended December 31, 2023, contributed $2.3 million to the decrease in selling, general and administrative expenses.
Research and Development Expenses Research and development expenses increased by $1.5 million, or 22.3%, from $6.5 million for the year ended December 31, 2021 to $8.0 million for the year ended December 31, 2022.
Research and Development Expenses Research and development expenses increased by $0.8 million, or 9.8%, from $8.0 million for the year ended December 31, 2022 to $8.8 million for the year ended December 31, 2023.
Products and services revenue for the year ended December 31, 2022 consist of sales of school buses of $1.7 million, DC and AC Chargers, including lease interest revenue of approximately $2.4 million, grid services revenue of $0.4 million, and engineering services of $0.3 million.
Products and services revenue for the year ended December 31, 2023 consisted of sales of school buses of $1.0 million , DC and AC Chargers of $4.8 million , grid services revenue of $0.8 million , and engineering services of $1.3 million .
Levo focuses on electrifying school buses, providing associated charging infrastructure, and delivering V2G services to enable safer and healthier transportation for children while supporting carbon dioxide emission reduction, renewable energy integration, and improved grid resiliency. Business Combination On March 19, 2021, we consummated the Business Combination with Newborn and Nuvve Corp. contemplated by the Merger Agreement.
Levo focuses on electrifying school buses, providing associated charging infrastructure, and delivering V2G services to enable safer and healthier transportation for children while supporting carbon dioxide emission reduction, renewable energy integration, and improved grid resiliency.
Net cash provided by financing activities for the year ended December 31, 2022 was $19.1 million, of which $13.1 million were the proceeds from the July 2022 Offering, partially offset by issuance cost, $3.8 million was provided in connection with the proceeds from the 2022 at-the-market common stock offering, partially offset by issuance cost, proceeds from the equity forward option put exercise of $2.0 million, and proceeds from the exercise of stock options of $0.2 million.
Net cash provided by financing activities for the year ended December 31, 2023 was $5.9 million, of which $5.0 million were the proceeds from the various 2023 Offerings, partially offset by issuance cost, and $0.9 million was provided in connection with the proceeds from the 2023 at-the-market common stock offering, partially offset by issuance cost.
The increase is attributed to a $2.0 million increase in products and services revenue, partially offset by a decrease of $0.8 million in grants revenue.
The increase is attributed to a $1.7 million increase in products and $1.4 million increase in services revenue due to higher customers sales orders and shipments, partially offset by a decrease of $0.1 million in grants revenue.
Accordingly, we consolidate Levo and record a non-controlling interest for the share of Levo owned by Stonepeak and Evolve during the years ended December 31, 2022 and 2021. 57 Liquidity and Capital Resources Sources of Liquidity We are an early-stage business enterprise.
We have determined that Levo is a variable interest entity (“VIE”) in which we are the primary beneficiary. Accordingly, we consolidated Levo and recorded a non-controlling interest for the share of Levo owned by Stonepeak and Evolve during the years ended December 31, 2023 and 2022. 62 Liquidity and Capital Resources Sources of Liquidity We are an early-stage business enterprise.
Shares of common stock sold under the Sales Agreement are offered and sold pursuant to our shelf registration statement describe above. During the year ended December 31, 2022, we sold 792,882 shares of common stock pursuant to the Sales Agreement at an average price of $4.97 per share for aggregate net proceeds of approximately $3.8 million.
During the year ended December 31, 2023, we sold 19,822 shares of common stock pursuant to the Sales Agreement at an average price of $99.40 per share for aggregate net proceeds of approximately $3.8 million.
Cash provided by financing activities for the year ended December 31, 2021 was $59.7 million, of which $58.2 million was provided in connection with the Business Combination, $14.3 million was provided in connection with the PIPE offering, $3.1 million was provided through the issuance of Levo's preferred stock, and $0.6 million was provided from the exercise of stock options, partially offset by issuance costs of $4.0 million, the repayment of Newborn sponsor loans of $0.5 million, the $6.0 million repurchase of common stock, the payment of investor stock liability of $2.0 million and the payment of legal and accounting costs of $1.0 million associated with the Business Combination. 60 Critical Accounting Policies and Estimates Management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S.
Cash provided by financing activities for the year ended December 31, 2022 was $19.1 million, of which $13.1 million were the proceeds from the 2022 Offering, partially offset by issuance cost, $3.8 million was provided in connection with the proceeds from the 2022 at-the-market common stock offering, partially offset by issuance cost, proceeds from the equity forward option put exercise of $2.0 million, and proceeds from the exercise of stock options of $0.2 million. 66 Critical Accounting Policies and Estimates Management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which have been prepared in accordance with U.S.
However, we may experience competition with other providers of EV charging station networks for installations. Many of these competitors have limited funding, which could lead to poor customer experiences and have a negative impact on overall EV adoption. Our growth in North America and Europe requires differentiating ourself as compared to the several existing competitors.
We are positioned to grow our North American and European business through future partnerships with charge point operators, OEMs and leasing companies. However, we may experience competition with other providers of EV charging station networks for installations. Many of these competitors have limited funding, which could lead to poor customer experiences and have a negative impact on overall EV adoption.
Net Loss Attributable to Non-Controlling Interest Net loss attributable to the non-controlling interest in Levo was $0.5 million for the year ended December 31, 2022. Net loss is allocated to non-controlling interests in proportion to the relative ownership interests of the holders of non-controlling interests in Levo, an entity formed by us with Stonepeak and Evolve.
Net loss is allocated to non-controlling interests in proportion to the relative ownership interests of the holders of non-controlling interests in Levo, an entity formed by us with Stonepeak and Evolve. We own 51% of Levo's common units and Stonepeak and Evolve own 49% of Levo's common units.
The increases during the year ended December 31, 2022 were primarily attributable to increases in compensation expenses of $1.6 million, including share-based compensation, office and warehouse facilities lease expenses of $0.8 million, Directors and Officers insurance expenses of $0.5 million, professional fees related to internal operational reviews of $1.5 million, governance and other public company costs of $2.3 million , and software subscriptions expenses of $0.5 million.
The decrease during the year ended December 31, 2023 was primarily attributable to decreases in compensation expenses of $1.7 million, including share-based compensation, decreases in travel related expenses of $0.7 million , decreases in subcontractor and outside services expenses of $0.3 million , decreases in professional fees related to internal operational reviews of $1.5 million, decreases in insurance related expenses of $1.0 million, partially offset by increases in audit services fees of $0.7 million , increases in bad debt expenses of $0.1 million , increased in lease expenses related to the main corporate office and warehouse of $0.1 million , increase in office expenses of $0.2 million , increase in legal expenses of $0.4 million and software subscriptions expenses of $0.6 million.
Selling, General and Administrative Expenses Selling, general and administrative expenses consist of selling, marketing, advertising, payroll, administrative, legal finance, and professional expenses. Selling, general and administrative expenses were $30.1 million for the year ended December 31, 2022 as compared to $22.9 million for the year ended December 31, 2021, an increase of $7.2 million, or 31.5%.
Selling, general and administrative expenses were $24.7 million for the year ended December 31, 2023 as compared to $30.1 million for the year ended December 31, 2022, a decrease of $5.4 million, or 18.0%.
In January and February 2023, we sold 78,638 shares of common stock pursuant to the ATM Agreement at an average price of $1.79 per share for aggregate net proceeds of approximately $0.1 million.
During the year ended December 31, 2023 , we sold 37,804 shares of common stock pursuant to the ATM Agreement at an average price of $25.60 per share for aggregate net proceeds of approximately $0.9 million. Effective October 16, 2023, we and the Agent agreed to terminate the ATM Agreement .
Chardan Capital Markets LLC acted as the placement agent for the February 2023 Offering and received a sales commission of 3% of the gross proceeds.
The closing of the February 2023 Offering occurred on February 21, 2023. The aggregate gross proceeds from the February 2023 Offering was approximately $0.5 million. Chardan acted as the placement agent for the February 2023 Offering and received a sales commission of 6.0% of the gross proceeds.
Cash Flows Years Ended December 31, 2022 2021 Net cash (used in) provided by: Operating activities $ (34,081,975) $ (29,190,718) Investing activities (1,438,045) (265,475) Financing activities 19,063,624 59,721,226 Effect of exchange rate on cash (50,228) 199,592 Net (decrease) increase in cash and restricted cash $ (16,506,624) $ 30,464,625 Net cash used in operating activities during the year ended December 31, 2022 was $34.1 million as compared to net cash used of $29.2 million in the year ended December 31, 2021.
We and Rhombus agreed to release one another from any and all claims relating to the Dispute. 65 Cash Flows Years Ended December 31, 2023 2022 Net cash (used in) provided by: Operating activities $ (21,254,328) $ (34,081,975) Investing activities 1,136,722 (1,438,045) Financing activities 5,862,746 19,063,624 Effect of exchange rate on cash 35,624 (50,228) Net (decrease) increase in cash and restricted cash $ (14,219,236) $ (16,506,624) Net cash used in operating activities during the year ended December 31, 2023 was $21.3 million as compared to net cash used of $34.1 million in the year ended December 31, 2022.
The decrease in margin was mostly due to the impact of lower margin school buses sales, and a higher mix of hardware charging stations sales and a lower mix of engineering services during the year ended December 31, 2022.
Margin was negatively impacted mostly by a higher mix of hardware charging stations sales, including the impact of lower margin school buses sales, offset by a lower mix of engineering services during the year ended December 31, 2023. Selling, General and Administrative Expenses Selling, general and administrative expenses consist of selling, marketing, advertising, payroll, administrative, legal finance, and professional expenses.
During the latter part of the year ended December 31, 2021, and the first half of the year ended December 31, 2022, we estimated that these disruptions could result in our future inability to fulfill customer orders which will in turn impact our net revenues.
Supply Chain Constraints Global inventory delays, increased and unpredictable lead times, labor shortages, and process capacity pressures, could impact our ability to service customer demand. During the years ended December 31, 2023 and 2022, we estimated that these disruptions could result in our future inability to fulfill customer orders which will in turn impact our net revenues.
Cost of Product and Service Revenue Cost of product and service revenues for the year ended December 31, 2022, increased by $2.2 million, or 109.6%, and margins decreased by 17.5%, to 14.0%, from 31.4% compared to the prior year period.
Cost of Product and Service Revenue Cost of products and services revenues for the year ended December 31, 2023, increased by $2.8 million to $7.0 million, or 66.3%, compared to $4.2 million for the year ended December 31, 2022 due to higher customers sales orders and shipments.
Other income (expense) increased by $59.74 million of income, from $47.38 million of other expense for the year ended December 31, 2021 to $12.36 million in other income for the year ended December 31, 2022.
Other income, net decreased by $11.5 million of income, from $12.4 million of other income for the year ended December 31, 2022 to $0.81 million in other income for the year ended December 31, 2023.
We will pay the Agent a commission of 3.0% of the aggregate gross sales prices of the Shares. We will also reimburse the Agent for fees and disbursements of its legal counsel in an amount not to exceed $50,000. We intend to use the net proceeds from the January 2023 ATM Offering for working capital and general corporate purposes.
We paid the Agent a commission of 3.0% of the aggregate gross sales prices of the Shares, and we reimbursed the Agent for fees and disbursements of its legal counsel in the amount of $50,000.
Purchase Commitments On July 20, 2021, we issued a purchase order (“PO”) to our supplier for a quantity of DC Chargers, for a total price of $13.2 million , with the delivery date specified as the week of November 15, 2021.
Purchase Commitments On July 20, 2021, we issued a purchase order (“PO”) to our supplier, Rhombus Energy Solutions, Inc. (“Rhombus”), for a quantity of DC Chargers and dispensers for EVs (“DC Chargers”), for a total price of $13.2 million. As previously disclosed, a dispute (the "Dispute") arose as to the PO, and an arbitration proceeding was initiated.
Growth in EV Adoption Our revenue growth is tied to the overall acceptance of commercial fleet and passenger EVs, which we believe will help drive the demand for intelligent vehicle-grid-integration solutions. The market for EVs is still rapidly evolving and although demand for EVs has grown in recent years, there is no guarantee of such future demand.
The market for EVs is still rapidly evolving and although demand for EVs has grown in recent years, there is no guarantee of such future demand.
The shelf registration statement was declared effective on May 5, 2022. We believe that we will be able to raise capital by issuing securities pursuant to its effective shelf registration statement. On May 5, 2022, we entered into an at-the-market offering agreement (the "Sales Agreement"), with Craig-Hallum Capital Group LLC and Chardan Capital Markets, LLC (the "Agents").
At the Market Offerings and Registered Direct Offerings 2022 ATM Offering Program On May 5, 2022, we entered into an at-the-market offering agreement (the "Sales Agreement"), with Craig-Hallum and Chardan Capital Market, LLC ("Chardan"), as agents (the "Agents").
However, if these inflationary pressures continue, our revenue, gross and operating margins and net income could be impacted in the year ending December 31, 2023.
However, if these inflationary pressures continue, our revenue, gross and operating margins and net income could be impacted in the year ending December 31, 2024. Growth in EV Adoption Our revenue growth is tied to the overall acceptance of commercial fleet and passenger EVs, which we believe will help drive the demand for intelligent vehicle-grid-integration solutions.
During the year ended December 31, 2021, we raised net proceeds of $61.8 million from the Business Combination and PIPE Offering (see our 2021 Form 10-K/A for details) to support our business operations. However, there can be no assurance we will be successful in raising necessary funds in the future, on acceptable terms or at all.
We plan to fund current operations through increased revenues and raising additional capital. Please see below for details. However, there can be no assurance we will be successful in raising necessary funds in the future, on acceptable terms or at all.
These were partially offset by improved timing and management of vendor terms compared to the cash settlement of such items. During the year ended December 31, 2022 and 2021, cash used in investing activities was $1.44 million and $0.27 million, respectively.
During the year ended December 31, 2023 cash provided by investing activities was $1.14 million as compared to net cash used for investing activities of $1.44 million during the year ended December 31, 2022.
Net loss Net loss increased by $50.1 million, or 67.1%, from $74.6 million for the year ended December 31, 2021 to $24.6 million for the year ended December 31, 2022. The increase in net loss was primarily due to increase in operating expenses of $9.7 million and increase in other expenses of $59.7 million for the aforementioned reasons.
Net loss Net loss increased by $6.7 million, or 27.4%, from $24.6 million for the year ended December 31, 2022 to $31.3 million for the year ended December 31, 2023.
Net cash used in investing activities were used to purchase fixed assets and a future equity investment in a partnership alliance.
Net cash provided by investing activities were from the sale of our equity investment in Switch EV Ltd partnership alliance, partially offset by purchase of fixed assets.
July 2022 Securities Purchase Agreement, Pre-Funded Warrants and Warrants On July 27, 2022, we entered into a securities purchase agreement (the “Purchase Agreement”) with a certain institutional and accredited investor (the “Purchaser”), relating to the issuance and sale of 2,150,000 shares (the “Shares”) of common stock, pre-funded warrants to purchase an aggregate of 1,850,000 shares of common stock (the “Pre-Funded Warrants”), and warrants (the “July 2022 Warrants”) to purchase an aggregate of 4,000,000 shares of common stock in a registered direct offering (the “July 2022 Offering”).
April 2023 Registered Direct Offering On April 14, 2023, we entered into a subscription agreement with a certain institutional and accredited investor, relating to the issuance and sale of 45,455 shares of common stock in a registered direct offering (the “April 2023 Offering”). The offering price for the shares was $22.00 per share of common stock.
The closing of the February 2023 Offering occurred on February 21, 2023. The aggregate gross proceeds from the February 2023 Offering was approximately $0.5 million. We intend to use the net proceeds from the February 2023 Offering for working capital and general 58 corporate purposes.
The closing of the June 2023 Offering occurred on June 6, 2023. The aggregate gross proceeds from the June 2023 Offering was approximately $1.0 million. Chardan acted as the placement agent for the June 2023 Offering and received a sales commission of 6.0% of the gross proceeds.
Each Pre-Funded Warrant has an exercise price of $0.0001 per share of common stock, subject to adjustment for stock splits, reverse stock splits, stock dividends and similar transactions.
The combined price per share of common stock and the accompanying Series A Warrant, Series B Warrant and Series C Warrant was $2.00. The combined price per share of each Pre-Funded Warrant and accompanying Series A Warrant, Series B Warrant, and Series C Warrant was equal to $1.9999, and the exercise price of each Pre-Funded Warrant is $0.0001 per share.
Under current SEC regulations, as of the filing of this Annual Report on Form 10-K, our public float is less than $75 million, and under SEC regulations for so long as our public float remains less than $75 million, the amount we can raise through primary public offerings of securities in any twelve-month period using shelf registration statements is limited to an aggregate of one-third of our public float, which is referred to as the baby shelf rules.
Pursuant to the “baby shelf rules” promulgated by the SEC, if our public float is less than $75.0 million as of specified measurement 63 periods, the number of securities that may be offered and sold by us under a Form S-3 registration statement, including pursuant to our shelf registration statement, in any twelve-month period is limited to an aggregate amount that does not exceed one-third of our public float.
Removed
See Note 2 to the Consolidated Financial Statements included in this annual report on Form 10-K for more information.
Added
Our growth in North America and Europe requires differentiating ourself as compared to the several existing competitors.
Removed
The Business Combination was effected in two steps, as follows: (i) Newborn reincorporated to the State of Delaware by merging with and into us, with us surviving the merger as the new public company (the "Reincorporation Merger"), and (ii) immediately after the Reincorporation Merger, Merger Sub merged with and into Nuvve Corp., with Nuvve Corp. surviving the merger as our wholly-owned subsidiary (the "Acquisition Merger").
Added
Products and services margins for the year ended December 31, 2023 decreased by 1.8%, to 12.8%, compared to 14.6% for the same prior year period.
Removed
Also on March 19, 2021, we consummated the Private Investment in Public Equity ("PIPE"), generating net proceeds of $14,250,000. The most significant change in our future reported financial position and results as a result of the completion of the Business Combination and the PIPE was an estimated net increase in cash of approximately $62,018,410.
Added
The decrease during the year ended December 31, 2023 was primarily attributable to the change in fair value of the warrants liability and derivative liability, partially offset by gains realized from the sale of our equity investment in Switch EV Ltd (See Note 6 ) and sublease income related to the subleasing of part of our main office space (See Note 16 ). 61 Income Taxes In the years ended December 31, 2023 and 2022, we recorded nominal income tax expenses.
Removed
Total transaction costs of $3,702,421 were treated as a reduction of the cash proceeds with capital raising costs being deducted from our additional paid-in capital.
Added
The increase in net loss was primarily due to decrease in other expenses of $11.5 million, and an increase in operating expenses of $4.8 million, and which includes an increase in cost of product of $2.8 million mainly associated with the loss on the sale of school buses, partially offset by increase in revenue of $3.0 million for the aforementioned reasons.
Removed
In addition, the net cash proceeds were reduced by our payment of $6,000,000 to EDF Renewables in connection with the repurchase from them of 600,000 shares of our common stock pursuant to the Purchase and Option Agreement, payment of $487,500 to NeoGenesis Holding Co.
Added
Net Loss Attributable to Non-Controlling Interest Net loss attributable to the non-controlling interest in Levo was $0.01 million and $0.54 million for the year ended December 31, 2023 and 2022, respectively.
Removed
Ltd., the sponsor of Newborn, in repayment of loans made by the sponsor to Newborn, and deposit of $495,000 into escrow for the potential repayment of Nuvve Corp.'s PPP loan. Upon forgiveness of the PPP loan in June 2021, the $495,000 was released to us.
Added
February 2024 Public Offering On January 31, 2024, we entered into an underwriting agreement (the “Underwriting Agreement”) with Craig-Hallum Capital Group LLC (“Craig-Hallum”) regarding an underwritten public offering of our securities (the “Offering”).
Removed
Upon consummation of the Business Combination, Nuvve Corp-designated directors were appointed to five of the seven seats of our combined board of directors; Nuvve Corp’s Chief Executive Officer was appointed as Chairman of our combined board of directors; Nuvve Corp’s senior management became the senior management of our combined company; and the former stockholders of Nuvve Corp became the owners of approximately 48.3% of the outstanding shares of common stock of our combined company.

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