UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Amendment No. 1
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE QUARTERLY PERIOD ENDED
or
| TRANSITION REPORT PURSUANT TO SECTIONS 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number:
ENVIROTECH VEHICLES, INC.
(Exact name of registrant as specified in its charter)
| |
(State or other jurisdiction of | (I.R.S. Employer |
incorporation or organization) | Identification No.) |
|
|
(Address of principal executive offices, including zip code) |
( |
(Registrant's telephone number, including area code) |
N/A |
(Former name, former address and former fiscal year, if changed since last report) |
Securities registered pursuant to Section 12(b) of the Act: |
| Trading | Name of each exchange | ||
Title of each class | Symbol(s) | on which registered | ||
| | |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☐ Yes
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☐ Yes
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | |
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
The number of shares outstanding of the registrant's common stock as of October 12, 2023 was
EXPLANATORY NOTE
This Quarterly Report on Form 10-Q/A constitutes Amendment No. 1 (the “Amendment”) to the Quarterly Report on Form 10-Q of Envirotech Vehicles, Inc. (the “Company”) for the quarterly period ended March 31, 2023, which was originally filed with the Securities and Exchange Commission on October 16, 2023 (the “Original Filing”). This Amendment is being filed solely to correct a scrivener’s error in Part I, Item 1 “Financial Statements,” related to the presentation of “Restricted Cash” in the table entitled “Unaudited Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022.” This Amendment includes new certifications from the Company’s Chief Executive Officer and Chief Financial Officer dated as of the date of the filing of this Amendment, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. The certifications are filed with this Amendment as Exhibits 31.1, 31.2, 32.1 and 32.2.
Other than as described above, this Amendment does not amend, update or restate any information included in the Original Filing. This Amendment does not reflect events occurring after the Original Filing or modify or update disclosures in the Original Filing affected by subsequent events. This Amendment should be read in conjunction with the Original Filing.
ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
March 31, | December 31, | |||||||
2023 | 2022 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Restricted Cash | ||||||||
Marketable securities | ||||||||
Accounts receivable, net of allowance of $ and $ , respectively | ||||||||
Inventory, net | ||||||||
Inventory deposits | ||||||||
Prepaid expenses | ||||||||
Other current assets | ||||||||
Total current assets | ||||||||
Property and equipment, net | ||||||||
Goodwill | ||||||||
Other non-current assets | ||||||||
Total assets | $ | $ | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | $ | ||||||
Accrued liabilities | ||||||||
Notes payable - current | ||||||||
Total current liabilities | ||||||||
Long-term liabilities | ||||||||
Notes payable - long-term | ||||||||
Total liabilities | ||||||||
Stockholders’ equity (deficit): | ||||||||
Preferred stock, authorized, $ par value per share, issued and outstanding as of March 31, 2023, and December 31, 2022 | ||||||||
Common stock, authorized, $ par value per share, and Issued and outstanding as of March 31, 2023, and December 31, 2022, respectively | ||||||||
Additional paid-in capital | ||||||||
Accumulated deficit | ( | ) | ( | ) | ||||
Total stockholders’ equity | ||||||||
Total liabilities and stockholders’ equity | $ | $ |
See Accompanying Notes to Unaudited Consolidated Financial Statements.
ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
For the Three Months Ended | ||||||||
March 31, | March 31, | |||||||
2023 | 2022 | |||||||
Sales | $ | $ | ||||||
Cost of sales | ||||||||
Gross profit | ||||||||
Operating expenses | ||||||||
General and administrative | ||||||||
Consulting | ||||||||
Research and development | ||||||||
Total operating expenses, net | ||||||||
Income (loss) from operations | ( | ) | ( | ) | ||||
Other income (expense): | ||||||||
Interest income, net | ||||||||
Other income | ( | ) | ( | ) | ||||
Total other income | ||||||||
Loss before income taxes | ( | ) | ( | ) | ||||
Income tax expense | ||||||||
Net loss | $ | ( | ) | $ | ( | ) | ||
Net loss per share to common stockholders: | ||||||||
Basic and diluted | $ | ( | ) | $ | ( | ) | ||
Weighted shares used in the computation of net loss per share: | ||||||||
Basic and diluted |
See Accompanying Notes to Unaudited Consolidated Financial Statements.
ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
Three Months Ended 2023 and 2022
(unaudited)
Additional | ||||||||||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity (Deficit) | ||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | ( | ) | $ | ||||||||||||||
Stock based compensation | — | |||||||||||||||||||
Net loss | — | ( | ) | ( | ) | |||||||||||||||
Balance, March 31, 2023 | $ | $ | $ | ( | ) | $ |
Additional | ||||||||||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity (Deficit) | ||||||||||||||||
Balance, December 31, 2021 | $ | $ | $ | ( | ) | $ | ||||||||||||||
Common stock issued for cash | ||||||||||||||||||||
Common stock issued for lawsuit settlement | ||||||||||||||||||||
Stock based compensation | — | |||||||||||||||||||
Net loss | — | ( | ) | ( | ) | |||||||||||||||
Balance, March 31, 2022 | $ | $ | $ | ( | ) | $ |
See Accompanying Notes to Unaudited Consolidated Financial Statements.
ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
Three Months Ended | ||||||||
March 31, | ||||||||
2023 | 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | ( | ) | $ | ( | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | ||||||||
Unrealized loss on marketable securities | ||||||||
Stock based compensation expense | ||||||||
Changes in assets and liabilities: | ||||||||
Accounts receivable | ( | ) | ||||||
Inventory | ( | ) | ( | ) | ||||
Inventory deposits | ( | ) | ||||||
Prepaid expenses | ||||||||
Other current assets | ( | ) | ||||||
Other non-current assets | ||||||||
Accounts payable | ( | ) | ||||||
Accrued liabilities | ( | ) | ( | ) | ||||
Net cash used in operating activities | ( | ) | ( | ) | ||||
Cash flows from investing activities: | ||||||||
Purchase of property and equipment, net | ( | ) | ( | ) | ||||
Investment in marketable securities | ( | ) | ||||||
Sale of marketable securities | ||||||||
Net cash provided by investing activities | ||||||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of common stock | ||||||||
Principal repayments on debt | ( | ) | ( | ) | ||||
Net cash (used in) provided by financing activities | ( | ) | ||||||
Net change in cash, restricted cash and cash equivalents | ( | ) | ( | ) | ||||
Cash, restricted cash and cash equivalents at the beginning of the period | ||||||||
Cash, restricted cash and cash equivalents at the end of the period | $ | $ | ||||||
Supplemental cash flow disclosures: | ||||||||
Non-cash common stock lawsuit settlement | $ | $ |
See Accompanying Notes to Unaudited Consolidated Financial Statements.
ENVIROTECH VEHICLES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. | Organization and Operations |
Envirotech Vehicles, Inc. (“we”, “us”, “our” or the “Company”) is a provider of purpose-built zero-emission electric vehicles focused on reducing the total cost of vehicle ownership and helping fleet operators unlock the benefits of green technology. The Company serves commercial and last-mile fleets, school districts, public and private transportation service companies, and colleges and universities to meet the increasing demand for light to heavy-duty electric vehicles. The Company’s vehicles address the challenges of traditional fuel price cost instability and local, state, and federal regulatory compliance.
On February 22, 2022, the Company announced Osceola, Arkansas, as the site of its state-of-the-art manufacturing facility and new corporate offices. The Company has moved into an approximately
On June 28, 2022, we effected a
2. | Summary of Significant Accounting Policies |
Use of Estimates—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Fair Value of Financial Instruments—The carrying values of the Company’s financial instruments, including cash, accounts receivable and accounts payable approximate their fair value due to the short-term nature of these financial instruments. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 820, “Fair Value Measurement” defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. It also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:
Level 1: Observable inputs such as quoted prices in active markets;
Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
Level 3: Unobservable inputs that are supported by little or no market data and that require the reporting entity to develop its own assumptions.
The Company does
have any assets or liabilities that are required to be measured and recorded at fair value on a recurring basis.
Revenue Recognition—The Company recognizes revenue from the sales of zero-emission electric vehicles and vehicle maintenance and inspection services. The Company recognizes revenue in accordance with ASC Topic 606, “Revenue from Contracts with Customers”, which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. At March 31, 2023, the Company did have a concentration of customers;
In applying ASC Topic 606, the Company is required to:
(1) | identify any contracts with customers; |
(2) | determine if multiple performance obligations exist; |
(3) | determine the transaction price; |
(4) | allocate the transaction price to the respective obligation; and |
(5) | recognize the revenue as the obligation is satisfied. |
Product revenue includes the sale of electric trucks and cargo vans. These sales represent a single performance obligation and revenue is recognized when the vehicle is delivered and the customer has accepted the vehicle and signed the appropriate documentation acknowledging receipt of the vehicle. At this time, the title of the vehicle is transferred to the customer.
Marketable Securities—The Company invests in short-term, highly liquid, marketable securities, such as U.S. Treasury notes, U.S. Treasury bonds, and other government-backed securities. The Company classifies these marketable securities as held-to-maturity, as the intent is not to liquidate them prior to the respective stated maturity date. At March 31, 2023, the aggregate amount of the Company’s investments in marketable securities was $
Net Income (Loss) Per Share—Basic net income (loss) per share is calculated by dividing the Company’s net income (loss) applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period.
Diluted net loss per share is calculated by dividing the Company’s net loss applicable to common stockholders by the diluted weighted average number of shares of common stock outstanding during the period. The diluted weighted average number of shares of common stock outstanding is the basic weighted number of shares of common stock adjusted for any potentially dilutive debt or equity securities. As of March 31, 2023,
Concentration of Credit Risk—The Company has credit risks related to cash and cash equivalents on deposit with a federally insured bank, as at times it exceeds the $250,000 maximum amount insured by the Federal Deposit Insurance Corporation (“FDIC”). Additionally, the Company maintains cash and short-term securities invested at Arvest Bank, National Association (“Arvest”). Between FDIC and the Securities Investor Protection Corporation (“SIPC”) coverage, funds up to $
During the three months ended March 31, 2023, the Company’s bank required compensating balances for a subsidiary’s potential lease exposure and for the Company’s credit card limit, resulting in restricted cash of $
3. | Property and Equipment, Net |
Components of property and equipment, net, consist of the following as of March 31, 2023 and December 31, 2022:
March 31, | December 31, | |||||||
2023 | 2022 | |||||||
Furniture and fixtures | $ | $ | ||||||
Leasehold improvements | ||||||||
Machinery & equipment | ||||||||
Vehicles | ||||||||
Test/Demo vehicles | ||||||||
Total property and equipment | ||||||||
Less accumulated depreciation | ( | ) | ( | ) | ||||
Net property and equipment | $ | $ |
Depreciation expense was $
4. | Debt |
On June 15, 2021, the Company entered into an equipment financing agreement with Navitas Credit Corp. in connection with the purchase of certain inventory management software. The $
On July 15, 2022, the Company entered into an equipment financing agreement with Wells Fargo in connection with the purchase of facility grounds equipment. The $
Effective June 15, 2022, the Company entered into a premium financing agreement with First Insurance Funding to finance certain insurance coverage. The $
Effective August 20, 2022, the Company entered into a second premium financing agreement with First Insurance Funding to finance other insurance coverages. The $
Effective August 4, 2022, EVT secured a line of credit from Centennial Bank. Borrowings under the line of credit bear interest at
5. | Stock Warrants |
The Company’s outstanding warrants as of March 31, 2023 is summarized as follows, and all were exercisable at that date.
Number of | Exercise | Remaining | ||||||||||
Shares | Price | Contractual Life (years) | ||||||||||
Outstanding warrants expiring January 28, 2025 | $ | |||||||||||
Outstanding warrants expiring May 7, 2026 | $ | |||||||||||
Outstanding warrants on March 31, 2023 | $ |
In connection with the second closing of the Financing discussed in the Company’s Annual Report on Form 10-K filed with the SEC on April 26, 2022, the Company issued additional warrants to purchase up to
Approximately
As of March 31, 2023, the outstanding warrants have
6. | Stock Options and Restricted Shares |
Stock Options
As a result of the Merger closing (see Notes 2 and 3) there were
Weighted | ||||||||||||
Average | ||||||||||||
Remaining | ||||||||||||
Number of | Exercise | Contractual Life | ||||||||||
Shares | Price | (years) | ||||||||||
Outstanding Options at $2.00 Exercise Price | $ | |||||||||||
Outstanding Options at $2.40 Exercise Price | $ | |||||||||||
Outstanding Options at $3.62 Exercise Price | $ | |||||||||||
Outstanding Options at $9.00 Exercise Price | $ | |||||||||||
Outstanding Options at $26.20 Exercise Price | $ | |||||||||||
Outstanding at March 31, 2023 | $ | |||||||||||
Exercisable at March 31, 2023 | $ |
On January 7, 2022, the Company’s Compensation Committee granted Phillip W. Oldridge, the Company’s Chief Executive Officer, options to purchase
On January 7, 2022, the Company’s Compensation Committee granted Susan M. Emry, the Company’s Executive Vice President, options to purchase
On January 31, 2022, the Company’s Compensation Committee granted Christian S. Rodich, the Company’s Chief Financial Officer, options to purchase
On March 15, 2022, options to purchase
As of March 31, 2023, outstanding options had intrinsic value of $
Restricted Shares
During the first quarter of 2023, the Company awarded
7. | Related Party Transactions |
The Company has entered into lease agreements with SRI Professional Services, Incorporated (“SRI”), pursuant to which the Company leases equipment used in connection with the operation of its business (the “SRI Equipment Leases”). Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, and a member of its board of directors, serves as an executive officer and a member of the board of directors of SRI. The SRI Equipment Leases provide for the leasing of two vehicles that commenced on January 1, 2020 and the combined rent under such leases is $
The Company has entered into a cancelable month-to-month lease with SRI (the “SRI Office Lease”), pursuant to which the Company has leased office and warehouse space in the Porterville, California area for a term that commenced on January 1, 2020. The monthly rent under the SRI Office Lease is $
The Company has entered into a commercial lease agreement (the “ABCI Office Lease”) with Alpha Bravo Charlie, Inc. (“ABCI”) that commenced on April 1, 2020, for the lease of office space in Porterville, California. The monthly rent for this facility is $
During the first quarter of 2023, the Company reimbursed Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, and a member of its board of directors, $
8. | Commitments |
Other Agreements
On December 31, 2021, the Company entered into employment agreements with Phillip W. Oldridge (the “Oldridge Agreement”), its Chief Executive Officer, and with Susan M. Emry (the “Emry Agreement”), its Executive Vice President. According to the Oldridge Agreement, effective as of March 1, 2021, Mr. Oldridge will receive an annual base salary of $
Future minimum payments under operating leases are not material.
9. | Contingencies |
Except as set forth below, we know of no material, existing or pending, legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest.
GreenPower Litigation
On December 17, 2019, GreenPower Motor Company Inc., a public company incorporated under the laws of British Columbia (“GreenPower”), of which Phillip W. Oldridge, the Company’s Chief Executive Officer and Chairman of the Board, , previously served as a senior officer and a member of its board of directors, filed a notice of civil claim, captioned GreenPower Motor Company Inc. v. Phillip Oldridge et al., Action No. S-1914285, in the Supreme Court of British Columbia, against Phillip Oldridge, his trust, EVTDS and certain other companies affiliated therewith. The notice of civil claim alleges that Mr. Oldridge breached certain fiduciary duties owed to GreenPower by working with certain parties in direct competition with and at the expense of GreenPower. GreenPower alleges that the Company conspired with Mr. Oldridge to build its business, competing products and unfairly compete with GreenPower. GreenPower seeks general damages, special damages and punitive damages, plus interest and costs against EVTDS. Fact discovery, through document disclosure and examinations for discoveries, in this matter remain ongoing. The Company has denied all claims, believes the lawsuit is without merit, and intends to vigorously defend the action.
On or about July 18, 2021, GreenPower and GP Greenpower Industries Inc., (collectively “the GreenPower entities”) filed a counterclaim against David Oldridge, Phillip Oldridge, the Company and other companies in Supreme Court of British Columbia Action No. S207532. The counterclaim alleges that David Oldridge, Phillip Oldridge, the Company and other companies committed the tort of abuse of process by causing 42 Design Works Inc., to commence a lawsuit against the GreenPower entities. Additionally, GreenPower entities also advanced claims against David Oldridge, Phillip Oldridge, the Company and other companies for conspiracy. The pleadings in this lawsuit have not closed and we intend to vigorously defend the counterclaim.
On February 8, 2022, GreenPower Motor Company, Inc., a Delaware Corporation, and GreenPower Motor Company Inc., a Canadian Corporation, filed a complaint captioned GreenPower Motor Company, Inc. v. Phillip Oldridge, et al., Case No. 5:22-cv-00252 in the United States District Court for the Central District of California. The complaint names the Company and the following affiliated entities, officers, or directors: Phillip Oldridge, Envirotech Electric Vehicles Inc., Envirotech Drive Systems Incorporated US, Envirotech Drive Systems Incorporated Canada, Sue Emry, David Oldridge, S&P Financial and Corporate Services, Inc. GreenPower also named the Phillip Oldridge Trust and a purported entity called EVT Motors, Inc., but has since dismissed those parties. The complaint seeks an undisclosed amount of compensatory and punitive damages, injunctive relief to prevent the alleged anti-Competitive behavior, restitution for harm, an award of treble damages, and associate fees and costs. The complaint’s allegations are centered around the same assertions in the pending Canadian litigation. On May 10, 2022, the Company, together with other defendants, filed a Motion to Dismiss and/or Stay the lawsuit pending the outcome of the Canadian litigation. The Court issued stay of this case pending resolution of parallel litigation in Canada between similar parties. GreenPower and defendants have agreed that the U.S. GreenPower case will not proceed while Canadian litigation is pending. The Company believes that the lawsuit is without merit and intends to vigorously defend the action.
Mollik Litigation - Resolved
On August 23, 2018, a purported class action lawsuit captioned M.D. Ariful Mollik v. ADOMANI, Inc. et al., Case No. RIC 1817493, was filed in the Superior Court of the State of California for the County of Riverside against the Company, certain of its executive officers, Edward R. Monfort, the former Chief Technology Officer and a former director of ADOMANI, Inc., and the two underwriters of the Company’s offering of common stock under Regulation A in June 2017. This complaint alleges that documents related to our offering of common stock under Regulation A in June 2017 contained materially false and misleading statements and that all defendants violated Section 12(a)(2) of the Securities Act, and that the Company and the individual defendants violated Section 15 of the Securities Act, in connection therewith. The plaintiff seeks on behalf of himself and all class members: (i) certification of a class under California substantive law and procedure; (ii) compensatory damages and interest in an amount to be proven at trial; (iii) reasonable costs and expenses incurred in this action, including counsel fees and expert fees; (iv) awarding of rescission or recessionary damages; and (v) equitable relief at the discretion of the court.
On June 19, 2023, counsel for Electric Drivetrains and counsel for the Company participated in a mediation at which Electric Drivetrains and the Company executed a binding term sheet to completely resolve this matter. On July 18, 2023, Electric Drivetrains and all Defendants executed a Settlement Agreement for complete resolution of the case and dismissal against all Defendants with prejudice. No Company proceeds will be used to resolve this matter. On September 30, 2023, the Court dismissed this action with prejudice and the matter is completely resolved.
Brooks Litigation
On June 19, 2019, Alan K. Brooks, an ADOMANI investor, filed a complaint, captioned Alan K. Brooks v. ADOMANI, Inc., et al., Case No. 1-CV-349153 in the Superior Court of California for the County of Santa Clara, against the Company, certain of the Company’s executive officers and directors, two of the underwriters of the Company’s offering of common stock under Regulation A in June 2017, and certain of the underwriters’ personnel, among others (the “Brooks Case”). The complaint alleges that the Company and other defendants breached the terms of an agreement between Mr. Brooks and the Company by refusing to release
10. | Leases |
As of March 31, 2022, the Company is a party to
The Company has entered into the SRI Equipment Leases. Rent expense under the SRI Equipment Leases was $
The Company has entered into the SRI Office Lease. Rent expense under the SRI Office Lease was $
The Company has entered into the ABCI Office Lease. Rent expense under the ABCI Office Lease was $
The Company has entered into the Toledo Jet Center Lease for office space in the Ft. Lauderdale, Florida area effective February 15, 2022. The lease has a
In February 2017, the Company. signed a lease for storage space in Stockton, California to serve as a location to store vehicles and other equipment utilized for marketing and trade-show purposes. The lease is on a month-to-month basis and can be terminated by either party with 30-days’ notice. The total amount due monthly is $
In December 2019, the Company signed a lease for combined office space and warehouse location in Corona, California. The facility had been used to conduct research and development activity, stage materials, assemble and/or manufacture vehicles, perform pre-delivery inspections, test demo vehicles, and securely store vehicles, equipment, parts and finished goods vehicle inventories prior to November 2020 when ADOMANI, Inc. vacated its former corporate office space in Corona, California, and made such facility the new corporate office location in addition to its prior use. The lease is for a period of 36 months, commencing on January 1, 2020, and terminating on December 31, 2022. The base rent for the term of the lease was $
On February 4, 2020, the Company. signed a sublease agreement with Masters Transportation, Inc. (“Masters”) for Masters to occupy a portion of the Corona, California, facility that the Company occupied effective January 1, 2020 (see above). The effective date of the Masters’ sublease was February 1, 2020, and it expires when the Company’s lease on the Corona, California facility expires on December 31, 2022. Under the sublease, Masters is obligated to pay the Company monthly rent payments in an amount equal to $
As required by ASC 842, in conjunction with the Corona, California lease, the Company recognized an operating liability with a corresponding Right-Of-Use (“ROU”) asset of the same amounts based on the present value of the minimum rental payments of such lease. As of March 31, 2022, the ROU asset and related liability accounts were written off against each other due to the Company leaving the Corona California office and warehouse effective April 1, 2022 and to Masters taking over the remaining lease obligation for the facility.
In March 2023, the Company entered into an agreement with Berthaphil, Inc. to sublease approximately
Quantitative information regarding the Company’s leases is as follows:
Three Months Ended | ||||||||
March 31, | ||||||||
2023 | 2022 | |||||||
Lease expenses | ||||||||
Operating lease expenses | $ | $ | ||||||
Short-term lease expenses | ||||||||
Total lease cost | $ | $ | ||||||
Other information | ||||||||
Cash paid for the amounts included in the measurement of lease liabilities for operating leases: | ||||||||
Operating cash flows | $ | $ | ||||||
Weighted-average remaining lease term (in years): | ||||||||
Operating leases | — | |||||||
Weighted-average discount rate: | ||||||||
Operating leases | % | % |
11. | Subsequent Events |
The Company evaluates subsequent events that have occurred after the balance sheet date but before the consolidated financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, and (2) non-recognized, or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to that date. There were no material transactions that occurred subsequently to March 31, 2023 that would require the Company to disclose in this filing.
A list of exhibits is set forth at the end of this Quarterly Report on Form 10-Q for the information required by this item.
|
Incorporated by Reference |
|
|
|||||||||
Exhibit Number |
Exhibit Description |
Form |
File No. |
Exhibit |
Filing Date |
Filed Herewith |
||||||
|
|
|
||||||||||
31.1 |
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer |
X |
||||||||||
31.2 |
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer |
X |
||||||||||
32.1# |
X | |||||||||||
32.2# |
X | |||||||||||
101.INS |
Inline XBRL Instance Document* |
X |
||||||||||
101.SCH |
Inline XBRL Taxonomy Extension Schema Document* |
X |
||||||||||
101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase Document* |
X |
||||||||||
101.LAB |
Inline XBRL Taxonomy Extension Label Linkbase Document* |
X |
||||||||||
101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase Document* |
X |
||||||||||
101.DEF |
Inline XBRL Taxonomy Extension Definitions Linkbase Document* |
X |
||||||||||
104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |
# |
The information in Exhibits 32.1 and 32.2 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act (including this Quarterly Report), unless the Registrant specifically incorporates the foregoing information into those documents by reference. |
* |
In accordance with Rule 402 of Regulation S-T, this interactive data file is deemed not filed or part of this Quarterly Report for purposes of Sections 11 or 12 of the Securities Act or Section 18 of the Exchange Act and otherwise is not subject to liability under these sections. |
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned, thereunto duly authorized.
Envirotech Vehicles, Inc. |
|||
Date: November 1, 2023 |
By: |
/s/ Phillip W. Oldridge |
|
Phillip W. Oldridge |
|||
Chief Executive Officer |
|||
(Principal Executive Officer) |
|||
Date: November 1, 2023 |
By: |
/s/ Douglas M. Campoli |
|
Douglas M. Campoli | |||
Chief Financial Officer and Treasurer |
|||
(Principal Financial and Accounting Officer) |