−Removed: We are 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.
−Removed: We serve 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.
−Removed: Our vehicles address the challenges of traditional fuel price cost instability and local, state and federal environmental regulatory compliance.
−Removed: We currently offer Class 2 through 4 logistics vans, Class 4 through 5 urban trucks, school buses, electric forklifts, street sweepers, neighborhood electric vehicles and right-hand drive vans and urban trucks.
−Removed: Our vehicles are manufactured by original equipment manufacturers ("OEM") located in China, Malaysia and the Philippines and can be marketed, sold, warrantied and serviced through our developing distribution and service network.
−Removed: Our vehicles include options for telemetrics for remote monitoring, electric power-export and various levels of grid-connectivity.
−Removed: Our zero-emission products may also grow to include automated charging infrastructure and “intelligent” stationary energy storage that enables fast vehicle charging, emergency back-up facility power, and access to the developing, grid-connected opportunities for the aggregate power available from groups of large battery packs.
+Added: We are a diversified, power-backed hardware technology company focused on the development, integration, and deployment of electrified and energy-intensive systems across multiple end markets.
+Added: Our operating and development initiatives are organized around a common foundation of power management, electrification, and integrated hardware know-how, with current focus areas including commercial EVs, electric drone platforms, and medical supplies.
+Added: We are also exploring opportunities to develop and deploy energy-integrated artificial intelligence (“AI”) compute infrastructure.
+Added: EVTV’s intended role would be to design, integrate, and deploy modular AI compute systems that combine power generation, power management, and high-performance computing hardware.
+Added: EVTV would not develop proprietary AI software models.
+Added: Rather, the Company’s focus would be on the physical infrastructure layer — including power systems integration, modular compute enclosures, cooling systems, and related electrical balance-of-system components — designed to support third-party AI workloads.
+Added: Revenue, if pursued, would be generated through equipment sales, system integration services, infrastructure leasing arrangements, and/or joint ventures with energy and technology partners.
+Added: As of the date of this Annual Report, we are in the testing and validation phase of our modular AI infrastructure platform.
+Added: Our EV segment serves commercial and last-mile fleets, school districts, public and private transportation service companies and colleges and universities to meet their demand for light to heavy-duty EVs.
+Added: We currently offer Class 2 through 4 logistics vans, Class 4 through 5 urban trucks, school buses, electric forklifts, street sweepers, neighborhood EVs and right-hand drive vans and urban trucks.
+Added: Our EVs are manufactured by original equipment manufacturers (“OEMs”) located in China, Taiwan, and Malaysia and can be marketed, sold, warrantied and serviced through our developing distribution and service network.
+Added: Our medical supplies segment operates through our wholly owned subsidiary, Maddox Industries, LLC (“Maddox Industries”), and manufactures medical supplies for distribution by Maddox Medical Corp.
+Added: (“Maddox Medical”), of which Jason Maddox, our President and Interim Chief Financial Officer, is the founder and a stockholder, and Elgin Tracy, our Chief Operating Officer, is also a stockholder, to government agencies, healthcare systems, and institutional customers requiring domestically manufactured medical products.
+Added: This segment was established upon our acquisition of Maddox Industries in late 2024, to support U.S.-based manufacturing, supply chain resiliency, and government procurement requirements.
+Added: We utilize semi-automated manufacturing systems to produce medical supplies, including protective apparel and related products, in compliance with applicable regulatory and contractual standards.
+Added: Products manufactured by this segment are intended for use in healthcare, emergency response, and government stockpile applications.
+Added: The medical supplies segment supports our broader manufacturing strategy by generating revenue, validating domestic manufacturing capabilities, and demonstrating our ability to execute regulated production at scale.
+Added: While this segment is not our primary long-term growth focus, it provides operational experience and past-performance manufacturing credentials for the federal government that support other business initiatives.
+Added: Our drone segment is focused on the development of heavy-lift, industrial-grade drone platforms designed for agricultural, fire suppression, and forestry applications.
+Added: This segment targets commercial agricultural operators, farming cooperatives, forestry managers, and public-sector customers seeking aerial solutions for large-area spraying, monitoring, and emergency response.
+Added: We are developing a high-payload agricultural drone capable of carrying significantly greater payloads than typical commercial drones, with a focus on durability, operational efficiency, and suitability for large-scale land management.
+Added: The platform is intended to support precision agriculture, including crop spraying and treatment across extensive acreage, as well as fire suppression and forestry use cases involving water or fire-retardant delivery.
+Added: As of the date of this Annual Report, we are in the design phase of our drone product offerings.
+Added: Our drone products are intended to be manufactured in the United States (the “U.S.”), subject to completion of product development, regulatory approvals, and manufacturing readiness.
+Added: We are also evaluating the integration of advanced technologies, including geospatial mapping, coordinated multi-drone operations, and artificial intelligence-enabled sensing and analytics.
+Added: Commercial manufacturing and sales of drone products have not yet commenced.
+Added: In the first quarter of 2025, we acquired a 52% equity interest in AG Drone Inc.
+Added: (“AG Drone”).
+Added: The remaining equity interest in AG Drone is owned equally by Phillip Oldridge, the Chairman of our Board of Directors (the “Board”) and our Chief Executive Officer, Jason Maddox, our President and Interim Chief Financial Officer, and Elgin Tracy, our Chief Operating Officer.
+Added: There were no transactions conducted by AG Drone during 2025.
+Added: All transactions conducted by the Company within the drone segment were transacted directly by the Company.
+Added: Recent Developments
+Added: Business Strategy
+Added: Within our EV segment, we have historically operated as a provider of zero-emission EVs to commercial and institutional customers.
+Added: However, the EV sector experienced significant disruption as a result of changes in U.S.
+Added: federal and state policies, reduced availability of federal and state incentive programs for EVs, and increased uncertainty surrounding long-term EV adoption.
+Added: These developments contributed to widespread contraction across the commercial EV market, with many competitors reducing operations or exiting the sector altogether.
+Added: At the same time, substantial increases in import tariffs on certain components, including tariffs exceeding 100% on selected parts and subassemblies sourced from Asia, materially impacted the economic feasibility of domesticating certain manufacturing processes for our EVs.
+Added: These cost pressures reduced margin predictability and constrained our ability to shift specific elements of our EV production to the U.S., particularly battery-related components, to the extent previously anticipated.
+Added: In response, we have adjusted our operational strategy to prioritize existing inventory, selectively source domestically available components, and focus on vehicle classes for which we maintain sufficient parts availability and customer demand.
+Added: While we continue to support and deliver our existing commercial EV offerings, the combination of policy-driven market contraction, elevated input costs, and tariff-related volatility prompted a broader strategic reassessment during 2025.
+Added: As a result, we began positioning our company as a platform for expanding into additional power-backed hardware technology verticals that are adjacent to our core competencies and offer the potential for higher-margin and recurring revenue characteristics, including electric drone technologies.
+Added: Beginning in 2026, we also began exploring opportunities in power-intensive AI data compute infrastructure.
+Added: Both of these verticals rely on our experience in electrification, power systems integration, and hardware deployment.
+Added: In connection with this strategic evolution, our acquisition of Maddox Industries in late 2024, the underpinnings of our medical supplies segment, has provided operational validation of our ability to design, deploy, and operate semi-automated, domestic manufacturing systems in regulated environments.
+Added: Through Maddox Industries, we have established U.S.-based production capabilities focused on fulfilling our subcontract with Maddox Medical for medical supplies for government use, thereby supporting our domestic supply chain objectives and establishing past-performance manufacturing credentials with the federal government.
+Added: We believe that this experience further reinforces our broader strategy of deploying power-backed hardware systems across multiple end markets while maintaining disciplined execution and operational control.
+Added: Goba Capital Financing
+Added: In the third quarter of 2025, we terminated our purchase order discounting facility for up to $10 million with GOBA Capital.
For the years ended December 31, 2025 and 2024, our net losses were $39.1 million and $8.8 million, respectively.
−Removed: Included in the net losses for 2024 and 2023 were non-cash charges of approximately $2.7 million and $6.6 million, respectively.
−Removed: On October 30, 2024, we entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Maddox Industries, LLC, a Puerto Rico limited liability company (“Maddox Industries”), and Jason Maddox, the sole member of Maddox Industries (the “Seller”), pursuant to which, subject to the terms and conditions of the Purchase Agreement, we purchased from the Seller all of the issued and outstanding membership interests (the “Purchased Interests”) in Maddox Industries (the “Maddox Acquisition”).
−Removed: In connection with the Maddox Acquisition, our Board of Directors (the “Board”) also appointed Jason Maddox as our President in October 2024.
−Removed: As consideration for the Purchased Interests, at the closing of the Maddox Acquisition on December 18, 2024 (the “Closing”), the Company issued 3,100,000 shares of the Company’s common stock, par value $0.00001 per share (the “common stock”), to the Seller (the “Stock Consideration”).
−Removed: In addition, during the six-month period following the Closing (the “Earnout Period”), the Seller was eligible to receive up to six monthly cash payments in an aggregate amount of up to $1 million (each such monthly payment, an “Earnout Payment”), with the Earnout Payment for each calendar month being equal to the aggregate amount of gross revenue received by Maddox Industries in respect of any closing receivable, as specified in the Purchase Agreement, during such calendar month, subject to an aggregate limit of $1 million with respect to all Earnout Payments payable under the Purchase Agreement.
−Removed: See Note 3 – Acquisitions to the consolidated financial statements for additional information regarding the Maddox Acquisition.
+Added: Included in the net loss for 2025 were non-cash charges of approximately $26.4 million.
Market Overview
−Removed: Concerns regarding climate change and other environmental considerations have led to the implementation of laws and regulations that restrict, cap, or tax, emissions in the automotive industry and throughout other industries.
−Removed: In particular, the Environmental Protection Agency ("EPA"), Tier 4 emission standards, California Air Resources Board ("CARB") regulations, and European Union Stage I, II, III, IV, V and VI regulations require significant reductions in the level of emissions and particulate matter produced by diesel power systems and are increasing the costs associated with producing carbon-intensive fuels.
−Removed: On June 25, 2020, CARB passed a first-in-the-world rule, generally referred to as the Advanced Clean Truck regulation (the “Advanced Clean Truck Regulation”), requiring truck manufacturers to sell increasing percentages of zero-emission medium and heavy-duty trucks, starting with the 2024 model year.
−Removed: Numerous other states have adopted California’s standards established under this rule.
−Removed: More recently, on April 28, 2023, CARB issued the Advanced Clean Fleets rule (the “Advanced Clean Fleets Rule”) that would require owners of medium- and heavy-duty vehicle fleets to begin their transition toward zero-emission vehicles starting in 2024.
−Removed: However, in January 2025, CARB withdrew its request to the EPA for waiver of the Clean Air Act’s federal preemption provisions for the Advanced Clean Fleets Rule, and now the status of this rule remains uncertain.
−Removed: On January 20, 2025, President Trump signed Executive Order 14154 “ Unleashing American Energy ” (“Executive Order 14154”), which may have direct implications on the policies and regulations that impact the automotive and transportation industries.
−Removed: This executive order seeks to rescind waivers granted by the EPA for California's zero emission vehicle regulations with a focus on eliminating any “electric vehicle mandates” and terminating “state emission waivers that function to limit sales of gasoline-powered vehicles” (which would include the Advanced Clean Truck Regulation) and modify and/or eliminate the greenhouse gas standards for trucks discussed above.
−Removed: As a result, the status of the U.S.
−Removed: and state emission regulations discussed above remain uncertain.
−Removed: Moreover, federal support for electric vehicle adoption generally may be in jeopardy under the Trump administration, as President Biden’s executive orders directing the federal government to transition to an all-electric fleet of cars and trucks have been rescinded.
−Removed: Additionally, the Trump administration has halted all federal funding for electric vehicle infrastructure and has ordered the termination of federal subsidy programs for EVs.
−Removed: These developments threaten the incentive structure needed for EVs.
−Removed: Even so, other regulations are expected to increase both the cost and size of emission-compliant diesel power products, primarily due to the need to incorporate additional combustion and after-treatment components.
−Removed: A variety of market factors are contributing to the increased use of alternative fuels and growth of alternative fuel technology, including economics, energy independence, environmental concerns, and the widespread availability of alternative fuels.
−Removed: As the price of crude oil remains volatile and the threats of climate change and air pollution increase as public concerns, we believe the search for more cost-effective and cleaner fuels has become more important.
−Removed: Electricity has emerged as a cleaner-fuel solution to these challenges.
−Removed: The price of alternative fuels such as electricity is often substantially less than diesel or gasoline, and alternative fuels can result in the production of lower amounts of greenhouse gases and other air pollutants.
−Removed: In addition, several public utilities in California and elsewhere have applied to their states’ public utility commissions for rate increases to be used for the purchase or leasing of electric vehicles and infrastructure.
−Removed: Additional requests have been made by the utilities to offer favorable costs for electric bus charging.
−Removed: According to the Global EV Outlook 2024 report by the International Energy Agency (“IEA”), nearly 14 million new electric vehicles were registered globally in 2023.
−Removed: This amount was 3.5 million higher than in 2022, a 35% year-on-year increase.
−Removed: According to the IEA, electric vehicles sales accounted for 18% of all cars sold globally in 2023, up from 14% in 2022.
−Removed: In 2024, electric car sales in the United States are projected to rise by 20% compared to the previous year, translating to almost half a million more sales, relative to 2023.
−Removed: According to the 2024 Global Hybrid & Electric Cars industry profile report by MarketLine, the global market for hybrid and electric cars is set to follow a double-digit growth trend over the forecast period between 2023 and 2028.
−Removed: The Asia-Pacific and European regions have been the leaders in electric vehicles adoption, accounting for 53% and 29% of the global market for hybrid and electric cars in 2023, respectively, with North America representing 15% of the market.
−Removed: Government policy, however, remains ever-changing and likely continues to play a foundational role in the rate of adoption around the world.
−Removed: In China, the government has mandated that electric vehicles make up 40% of all auto sales by 2030.
−Removed: Meanwhile, we believe that tightening emissions standards and high fuel taxes in Europe will result in substantial increases in the market share of electric vehicles.
−Removed: According to the Global EV Outlook 2024 report by the IEA, in 2023, just under 60% of new electric vehicle registrations were in China, compared to just under 25% in Europe and 10% in the United States.
−Removed: In the U.S., new electric vehicle registrations totaled 1.4 million in 2023, increasing by more than 40% compared to 2022.
−Removed: The overall market for electric vehicles consists of multiple, discrete markets for various vehicle types, including passenger cars, buses, two-wheelers and others.
−Removed: Passenger cars are the most prominent, but two-wheelers are far more prevalent, particularly in Asia, and buses and trucks, although smaller in number, are significantly higher in price and often purchased in bulk by major corporate customers or government or transit agencies.
−Removed: Charging infrastructure is another important factor in electric vehicles adoption rates.
−Removed: According to Pew Research Center report, there were approximately 61,000 publicly accessible electric vehicles charging stations in the United States as of February 2024, with the number of charging stations more than doubling since 2020.
−Removed: S&P Global estimates that by 2030, the United States will need 2.13 million Level 2 and 172,000 Level 3 chargers.
−Removed: In an effort to help address this need, in September 2022, the National Electric Vehicle Infrastructure Program, established and funded by the Infrastructure Investment and Jobs Act (the “IIJA”), which was signed into law on November 15, 2021, provided $5 billion in funding to all 50 U.S.
−Removed: and Puerto Rico to strategically deploy electric vehicles charging infrastructure and to establish an interconnected network to facilitate data collection, access, and reliability.
−Removed: Additionally, the IIJA included $7.5 billion to build a national network of 500,000 chargers by 2030.
−Removed: However, in early 2025, the Trump administration issued a pause on all IIJA funding directed towards, among other programs, electric vehicles infrastructure development and subsidy programs.
−Removed: That funding remains paused subject to the review of the Office of Management and Budget (the “OMB”).
−Removed: The OMB has released some paused IIJA funding, but funding for the programs focused on supporting the electric vehicles industry remains frozen.
−Removed: The future of key federal funding and electric vehicles tax credits from the IIJA and Inflation Reduction Act (the “IRA”) is uncertain as Congress moves forward with its tax reform bill expected to pass early summer 2025.
−Removed: The House and Senate have both passed their respective budget resolutions on strict party-line votes, and the Republican majorities in both chambers of Congress have signaled that clean energy tax credits are possible targets for elimination to pay for extending the 2017 Tax Cuts and Jobs Act (TCJA) tax cuts and other key aspects of the Trump administration’s agenda.
−Removed: The extent to which the IIJA funding and IRA tax credits, specifically those supporting electric vehicles, will be amended or eliminated remains unclear.
−Removed: However, it is likely that some if not all of these funding avenues will be affected.
−Removed: Commercial Vehicles
−Removed: In 2023, according to the IEA’s Global EV Outlook 2024 report by the IEA, nearly 50,000 electric buses and around 54,000 medium- and heavy-duty trucks were sold worldwide, representing about 3% of all bus sales and over 2.5% of truck sales worldwide.
−Removed: China continues to dominate production and sales of electric (and fuel cell) trucks and buses, contributing to about 60% of global electric bus sales in 2023.
−Removed: However, the global market is growing and is expected to continue to grow in the foreseeable future.
−Removed: Medium- and Heavy-Duty Trucks:
−Removed: According to the International Council on Clean Transportation (“ICCT”) report, “ Zero-Emission Bus and Truck Market in the U.S.
−Removed: (Jan – June 2024) ”, U.S.
−Removed: sales of zero-emission heavy-duty vehicles saw notable growth, with 1,381, or 0.56%, of the approximately 120,000 new heavy-duty vehicles being registered in the U.S.
−Removed: during the first half of 2024 being zero-emission vehicles.
−Removed: This represents a significant increase from the 0.30% share observed in 2023.
−Removed: According to the ICCT, zero-emission buses in the U.S.
−Removed: reached a milestone in the first quarter of 2024, representing nearly 11% of all bus registrations—the first instance of double-digit market penetration in any heavy-duty vehicle segment.
−Removed: Despite technological advancements, electric trucks still represent a small fraction of total truck sales.
−Removed: Challenges such as supply chain issues and inadequate charging infrastructure have impeded more rapid adoption.
−Removed: Environmental Benefits
−Removed: Because heavy-duty commercial vehicles consume considerably more fuel than light duty passenger vehicles, the environmental benefits of replacing conventionally fueled commercial vehicles with electric vehicles can also be substantial.
−Removed: Whereas an electric passenger car may reduce greenhouse gas (“GHG”) emissions by 3 tons per year as compared to a conventional car, replacing a conventional Class 8 port drayage truck with an electric equivalent can substantially reduce GHG emissions.
−Removed: Specifically, electric buses and trucks produce zero tailpipe emissions, leading to reductions in nitrogen oxides (NOx) and particulate matter (PM).
−Removed: This shift can improve air quality, particularly in urban areas, benefiting public health.
−Removed: Replacing a conventional diesel bus with an all-electric bus can achieve a 78 metric ton (approximately 171,961 pounds) reduction in GHG emissions.
−Removed: Electric buses can also reduce nitrous oxide emissions by 47 kg (approximately 104 pounds) per year compared to a diesel bus and 19 kg (approximately 42 pounds) compared to a clean natural gas (“CNG”) bus.
−Removed: As discussed below, we believe these pollution reductions have had the greatest impact in the electric bus market, where municipalities are the principal purchasers.
−Removed: A first-of-kind, comprehensive study was released in December 2019 assessing the environmental benefits and economics of various alternative fuel truck technologies.
−Removed: The study, conducted by the ICF International research firm (“ICF”), demonstrates that electric trucks and buses are a triple-win in terms of helping meet California’s climate and air quality targets;
−Removed: the least cost to own and operate across nearly all truck and bus classes by 2030, and provide the greatest job and economic benefits to the state.
−Removed: The study was commissioned by the Natural Resource Defense Council (“NRDC”) and the California Electric Transportation Coalition (an industry group representing utilities and vehicle manufacturers) and was sponsored by the Union of Concerned Scientists, Earthjustice, BYD, Ceres, and NextGen Climate America.
−Removed: Advisory support was provided by East Yard Communities for Environmental Justice and University of California, Davis.
−Removed: The study concluded that the costs of battery packs, and therefore the cost of electric trucks and buses, will decline such that by 2030, they will be the most attractive technology from a total cost of ownership perspective for nearly all truck and bus classes, even without incentives.
−Removed: According to recent research of Energy Innovation Policy & Technology, the decline in costs of electric heavy duty vehicles as compared to their diesel counterparts has accelerated, meaning that costs will fall faster than previously expected in 2030.
−Removed: By 2030, even when excluding available consumer incentives, electric heavy duty vehicles in most categories will be less expensive than their diesel counterparts.
−Removed: Governments worldwide are implementing policies to accelerate the adoption of electric commercial vehicles.
−Removed: For example, Transport for London embarked on a mission to electrify London’s iconic red business and, today, London boasts one of Europe’s largest electric bus fleets, with more than 1,600 zero-emission buses out of a total of 9,000.
−Removed: Similarly, the Los Angeles County Metropolitan Transportation Authority has committed to transitioning its entire bus fleet to zero emissions by 2030, with significant progress already made in electrifying certain bus lines.
−Removed: However, the future of federal policy towards electric vehicles in the U.S.
−Removed: remains uncertain.
−Removed: In summary, the transition to electric heavy-duty vehicles presents significant environmental advantages, including substantial reductions in GHG emissions and air pollutants.
−Removed: Ongoing technological advancements, supportive policies, and successful case studies underscore the potential for widespread adoption of electric buses and trucks in the coming years.
−Removed: Some of the main markets for electric trucks include delivery vans, shuttle buses, and utility or work trucks, each of which has its own set of challenges.
−Removed: Where hybrid electric vehicles have greater operational flexibility, and require less charging infrastructure, battery electric vehicles can be either short range, which can charge quickly and operate with limited interruption, or long range, which requires longer charging times but more intraday operational flexibility.
−Removed: Because of charging needs and restrictions, we believe short-haul fleet vehicles that operate in a limited geographic area and return to central locations, such as delivery vans and shuttle buses, are the best candidates for electrification.
−Removed: Transit Buses
−Removed: Some public transportation operators are facing pressure to purchase and operate low-emissions vehicles.
−Removed: For public entities, cleaner transportation systems can provide benefits beyond reduced operating costs, in the form of less pollution and lower abatement and cleanup costs.
−Removed: Electric transit buses are likely to have lower fuel and maintenance costs which is typically a significant cost component for transit operators as compared to conventional diesel buses.
−Removed: Electric buses generally have smoother, faster acceleration and provide a quieter ride, thus benefiting both passengers and the surrounding urban environment.
−Removed: Similar to other commercial fleet electric vehicles, transit buses have a higher initial acquisition cost than their traditional-fueled counterparts, and the logistics of charging remains a challenge.
−Removed: Electric buses can be two to nearly five times as expensive as conventional buses.
−Removed: In addition to public health and environmental benefits, school districts and transit agencies are able to experience cost savings due to reduced fuel and maintenance costs of electric buses.
−Removed: While electric transit buses cost approximately $200,000 more than diesel buses (depending on battery pack size) before incentives, lifetime fuel and maintenance savings of electric transit buses approximate $400,000.
−Removed: Electrification in the medium- and heavy-duty vehicle sector is increasing in the U.S.
−Removed: with California leading the way.
−Removed: Increasing investment in the sector from public and private sources, however, is expected to generate growth and significantly increase the number of electric trucks and buses on the road in the near term.
−Removed: Upfront costs associated with electric trucks and buses are expected to decline significantly through 2030 as battery prices fall, making them competitive on a total cost of ownership basis.
−Removed: — Federal Laws and Incentives
−Removed: During the first few months of 2025, the Trump administration introduced significant change in the prior administration’s positions and policies supporting electric vehicles.
−Removed: As part of the Executive Order 14154, the Trump administration eliminated the “electric vehicle mandate,” specifically directing the termination of state emissions waiver programs and other subsidies exclusively designed to support the electric vehicle market.
−Removed: Executive Order 14154 also paused all funding disbursed under the IRA and the IIJA directed at “Green New Deal” infrastructure and specifically mentioned electric vehicle charging stations as an industry subject to the pause.
−Removed: In March 2025, the EPA announced that EPA would be reconsidering vehicle emissions regulations but have not yet announced any proposed changes.
−Removed: Along with holding many U.S.
−Removed: certifications, we are identified as an eligible manufacturer by the Internal Revenue Service ("IRS") of light- to heavy-duty electric vehicles in the United States.
−Removed: This is significant because, as of January 1, 2023, federal tax credits are available for electric cars and trucks from eligible manufacturers.
−Removed: Individuals that purchase electric vehicles weighing less than 14,000 lbs.
−Removed: will receive a credit of $7,500.
−Removed: Commercial operators will receive a tax credit of up to $40,000 for each purchased vehicle over 14,000 lbs.
−Removed: Furthermore, with the Alternative Fuel Infrastructure Tax Credit, depending on the size of the chargers, businesses are eligible for a tax credit of up to 30% of the cost of the chargers and infrastructure, up to $100,000 per unit.
−Removed: Additionally, the Senate passed the IRA, the budget reconciliation bill that includes $3 billion over five years to establish a new grant program to install electrified equipment and reduce emission at ports.
−Removed: Each of these credits may be subject to amendment, reduction, or elimination in Congress’s upcoming reconciliation bill.
−Removed: We source components and parts to build our all-electric vehicles from suppliers globally, and the importation of these parts, components and vehicles to North America are subject to tariffs which have recently increased and may increase further in the future.
−Removed: In particular, electric vehicles and electric vehicle batteries that are imported from China to the United States became subject to a 100% and 25% tariff, respectively, in 2024.
−Removed: In March 2024, the Trump administration imposed a 20% additional tariff on all goods imported from China.
−Removed: While the tariffs on electric vehicles imported from China may increase competitiveness within the U.S.
−Removed: market, these tariffs are also expected to increase the costs of manufacturing electric vehicles in the U.S.
−Removed: The Trump administration’s inconsistent tariff policies have also contributed to declines in major stock indices.
−Removed: The S&P 500 and Nasdaq Composite experienced significant downturns since the start of 2025, with concerns over tariffs potentially accelerating inflation and creating uncertainty for business leaders.
−Removed: In addition, on January 29, 2025, Secretary of Transportation directed the Department of Transportation to rescind existing corporate average fuel economy standards and eliminate electric vehicle incentives.
−Removed: In March 2025, the EPA announced a formal reconsideration of the 2009 Endangerment Finding that classified greenhouse gases as harmful to human health.
−Removed: This finding is the legal underpinning of a host of climate regulations for motor vehicles, power plants and other pollution sources.
−Removed: In summary, recent policy shifts have significantly altered the trajectory of electric vehicle adoption and environmental regulations in the U.S.
−Removed: The rollback of incentives, imposition of tariffs, and deregulatory measures have created a complex landscape for manufacturers, consumers, and policymakers involved in the electric vehicles sector.
−Removed: U.S.—State Laws and Incentives
−Removed: Numerous U.S.
−Removed: states continue to play a central role in the promotion and adoption of electric vehicles, including zero-emission medium- and heavy-duty commercial vehicles (Class 4–8).
−Removed: Among these, California remains a leader in electric vehicles policy, having pioneered regulations and incentive programs that have since been adopted or adapted by other jurisdictions.
−Removed: California offers a suite of incentives for both individual and fleet electric vehicle owners, including tax credits and rebates, access to high-occupancy vehicle lanes, and various grant and loan programs.
−Removed: California maintains the nation’s most stringent tailpipe emissions standards and continues to implement the Zero-Emission Vehicle ("ZEV") program, which mandates automakers to produce an increasing percentage of zero-emission vehicles.
−Removed: These regulations have fostered the creation of a market for trading compliance credits among manufacturers, further incentivizing electric vehicles production and sales.
−Removed: California, New York, and New Jersey have also implemented voucher-based programs that significantly lower the cost of electric vehicles for both individuals and businesses.
−Removed: These programs offer additional incentives for qualifying entities, including minority-, women, and veteran-owned businesses and those operating in designated low-income or disadvantaged communities.
−Removed: Furthermore, California and New York have enacted legislation to ban the sale of new internal combustion engine (“ICE”) vehicles by 2035, establishing long-term regulatory clarity and market demand for zero-emission alternatives.
−Removed: Key state-level commercial vehicle incentives include:
−Removed: California – HVIP (Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project):
−Removed: Offers point-of-sale vouchers ranging from $20,000 to over $120,000 per eligible Class 4–8 vehicle, depending on vehicle size, fuel type, and fleet characteristics.
−Removed: Bonus incentives are available for vehicles operating in disadvantaged communities.
−Removed: New Jersey – NJZIP (New Jersey Zero Emission Incentive Program):
−Removed: Provides vouchers up to $175,000 per Class 4–8 zero-emission vehicle.
−Removed: Small businesses, minority-, women-, and veteran-owned enterprises may qualify for additional bonus incentives.
−Removed: New York – NYTVIP (New York Truck Voucher Incentive Program):
−Removed: Offers vouchers of up to $215,000 per battery-electric Class 4–8 truck and up to $385,000 for transit buses.
−Removed: Fleets operating in environmental justice communities or owned by disadvantaged businesses receive priority funding.
−Removed: Texas – Texas Emissions Reduction Plan (TERP):
−Removed: While primarily focused on emissions reductions from ICE vehicles, TERP provides funding for fleets replacing older diesel trucks with new zero-emission alternatives.
−Removed: Texas also offers a $2,500 light-duty electric vehicles rebate.
−Removed: Pennsylvania – Medium- and Heavy-Duty Zero Emission Vehicle (ZEV) Grant Program:
−Removed: Offers funding to replace Class 4–8 diesel vehicles with zero-emission models.
−Removed: Grants may cover up to 90–100% of project costs for government or financially distressed municipalities.
−Removed: Colorado – Clean Fleet Vehicle and Charging Incentives:
−Removed: Offers stackable grants and tax credits for commercial electric vehicle purchases and infrastructure installation.
−Removed: Incentives scale with vehicle weight and community impact.
−Removed: Utah – Heavy-Duty Alternative Fuel Vehicle Tax Credit:
−Removed: Provides up to $12,000 per vehicle (phasing down annually) for eligible alternative fuel Class 4–8 vehicles.
−Removed: These state initiatives complement federal programs, including the Commercial Clean Vehicle Credit, which as of 2024 provides a tax credit of up to $40,000 per qualifying commercial vehicle over 14,000 lbs.
−Removed: (Class 4–8), and the Alternative Fuel Infrastructure Tax Credit, which offers up to 30% of the cost of commercial charging stations, capped at $100,000 per unit.
−Removed: These policies collectively provide a supportive regulatory and financial framework for fleet operators and manufacturers investing in electric commercial vehicle platforms.
−Removed: They also create an opportunity for companies positioned to supply zero-emission trucks and infrastructure to high-demand urban corridors, port areas, and disadvantaged communities aligned with state climate and environmental justice goals.
−Removed: We are a provider of purpose-built zero-emission electric vehicles focused on reducing the total cost of ownership.
−Removed: Our vehicles are manufactured by OEMs locate d in China and Malaysia and m arketed, sold, warrantied and serviced through our developing distribution and service network.
−Removed: Our vehicles are designed to help fleet operators unlock the benefits of technology that reduces GHG, NOx, PM and other pollutants, as well as to address the challenges of lo cal, state and federal regulatory compliance and traditional-fuel price cost instability.
−Removed: We seek to enable our customers to:
−Removed: • Add Emission-Compliant Vehicles to Their Fleets.
−Removed: Our commercial fleet vehicles are designed to reduce or eliminate the use of traditional petroleum-based fuels that create GHG and particulate matter.
−Removed: • Reduce Total Cost of Ownership.
−Removed: Our technology is designed to reduce fuel budgets and maintenance costs by eliminating or reducing reliance on traditional petroleum-based fuels through the use of more energy efficient and less variably priced grid-provided electricity.
−Removed: • Reduce Maintenance Costs of Existing Vehicles.
−Removed: Zero-emission electric vehicles generally have lower maintenance costs.
−Removed: These reduced maintenance costs may take the form of longer service intervals between brake system maintenance, elimination of internal combustion engine oil and oil filter changes, reduction or elimination of transmission oil and oil filter changes, reduction or elimination of air filter changes, elimination of emissions systems services, elimination of diesel emission fluid use, elimination of emissions and the elimination of certification tests.
−Removed: • Plan for Natural Disasters When Fuel Supply May be Interrupted.
−Removed: Our zero-emissions systems are designed, when optionally equipped, to serve as on-site emergency back-up energy storage if grid power becomes intermittent or fails temporarily during natural or man-made disasters.
−Removed: • Improve the Environment Around Vehicles.
−Removed: As a result of our zero-emission systems, drivers, operators, customers and the communities they serve could have healthier environments in and around these vehicles.
−Removed: We intend to capitalize on these opportunities by pursuing the following key strategies:
−Removed: Build VSP Fleet Sales and Develop Sales Staff.
−Removed: Following the impact of the COVID-19 pandemic and associated economic challenges in 2020, we eliminated our in-house sales team.
−Removed: While we were unable to fully reestablish a dedicated sales force through 2021, 2022, and 2023, we began rebuilding our commercial sales team in 2024.
−Removed: We supplemented these efforts with executive-led outreach, as well as collaboration with industry professionals with established relationships in the commercial trucking sector, municipal and state transportation departments, and school districts.
−Removed: As we saw the growing demand for electric logistics vans with independent Vehicle Service Providers (“VSPs”) that have service contracts under franchise agreements with major retailers we engaged Plugd as a dealer and partner that would buy and lease our electric vans to these VSPs.
−Removed: The VSPs have been slow to purchase or lease fleets and requirements of building specific Class 2 Vans have not been as quick to convert to sales as expected.
−Removed: While we shall continue to work towards VSP fleet sales, we will also focus on building our internal sales team to set up physical dealers in key states such California, New Jersey, New York, and Texas, and other states that have heavy incentives for our electric vehicle products.
−Removed: Build Dealership and Service Networks.
−Removed: We plan to continue with a buildout of our dealership and service network to support sales, delivery, and post-sale service of our purpose-built, zero-emission electric commercial vehicles.
−Removed: In 2024, we added a New Jersey service center to fully support our largest customer base which is in the New Jersey corridor between New York City and Philadelphia.
−Removed: We have invested in a full- service station with battery services to make sure there is support for our New Jersey customers.
−Removed: We have invested in a full-service station with battery services to make sure there is support for our New Jersey customers.
−Removed: We also plan to open a service center in Houston, Texas.
−Removed: In addition to our buildout of our service centers, we plan to build out dealer service centers, which will include a parts department to create additional revenue for our company as well as our dealers as well as provide warranty work and a program for dealers.
−Removed: We also plan to develop training programs for our dealers to support their sales efforts.
−Removed: We plan to have a strong focus on building out our California dealers as we have submitted our new model year vehicles to CA HVIP which we believe should qualify for state incentives that we expect to drive small business and fleet sales in the state of California.
−Removed: Develop Third-Party Relationships.
−Removed: We finalized several strategic partnerships in 2024 and remain actively engaged in discussions to expand our relationships with third-party service providers, suppliers, upfitters, technology integrators, and distribution partners.
−Removed: These relationships are key to supporting our vehicle deployments and ensuring customer satisfaction across target geographies and vehicle classes.
−Removed: Provide Demonstrations.
−Removed: We plan to have product demonstrations to key fleet services and government agencies.
−Removed: These demonstrations remain a key element of our market development strategy, particularly as new product classes move from prototype to commercialization.
−Removed: Obtain Approvals from Incentive Programs.
−Removed: Our vehicles have been approved for several critical state and federal incentive programs.
−Removed: As of 2024, our Class 4 through 8 vehicles remain eligible for the Commercial Clean Vehicle federal tax credit of up to $40,000 per vehicle.
−Removed: Our new products have also been submitted to be eligible under the California HVIP program and to continue under the New Jersey NJZIP voucher program, among others.
−Removed: These programs materially reduce the total cost of vehicle ownership for our customers and increase our competitive positioning.
−Removed: Grow Our Manufacturing, Installation and Service Capability.
−Removed: In 2024, we made substantial progress in expanding our operational footprint at our Osceola, Arkansas facility.
−Removed: We began final assembly and integration of vehicle sub-systems at this location.
−Removed: We built a battery balancing room within the facility to house battery components and perform battery assembly and balancing tasks.
−Removed: We plan to o pen up our h eadquarters in Houston, Texas as we believe having administrative functions in a large metro area will give us larger access to executive level talent and l ogistics customers that operate from Houston.
−Removed: We also plan to open a final assembly and pre-delivery location for sales and support within the Houston and the broader Texas region.
−Removed: The Houston location will also house R&D (as defined below) , engineering, and sales efforts for us as well as production and logistics functions for the recent Maddox Acquisition.
−Removed: Expand Technical Support Capabilities.
−Removed: In response to growing customer demand and vehicle deliveries, we have expanded our technical support team, including the hiring of additional service technicians and field support staff.
−Removed: These resources are focused on providing maintenance, diagnostics, warranty support, and repairs for deployed vehicles in both domestic and international markets.
−Removed: Introduce New Products and Platforms.
−Removed: As market demand for electrification expands, we plan to grow our product offerings beyond vehicle platforms.
−Removed: Our development roadmap includes the integration of Electric Vehicle Supply Equipment, vehicle-to-grid hardware, stationary energy storage systems, and advanced power management technologies.
−Removed: These complementary offerings will enable us to provide fleet customers with a more complete zero-emission transportation ecosystem.
+Added: Electric Vehicle Market Conditions and Policy Environment
+Added: During 2025, the U.S.
+Added: EV market was impacted by changes in federal policy direction, uncertainty surrounding the continuation of federal and state incentive programs, and evolving U.S.
+Added: tariffs and trade policy.
+Added: These factors collectively altered the growth expectations for portions of the EV sector, particularly for incentive-dependent commercial and fleet applications such as our EV portfolio.
+Added: In January 2025, the U.S.
+Added: presidential administration issued Executive Order 14154, which directed federal agencies to pause and review certain funding programs established under the Inflation Reduction Act (“IRA”) and the Infrastructure Investment and Jobs Act (“IIJA”), including programs supporting EV charging infrastructure and related electrification initiatives.
+Added: As a result, the timing and availability of certain federal EV incentives became uncertain, contributing to delayed purchasing decisions among fleet operators and institutional customers that historically relied on grant and rebate programs to support EV project economics.
+Added: While some state-level incentive programs remain active, the overall federal and state policy environment for EV adoption in the U.S.
+Added: became less predictable during 2025.
+Added: At the same time, U.S.
+Added: trade policy developments materially affected the cost structure of our EV manufacturing and assembly.
+Added: In September 2024, the Office of the U.S.
+Added: Trade Representative finalized modifications to Section 301 tariffs on Chinese goods that increased tariff rates on Chinese-origin EVs to 100% and on certain lithium-ion EV batteries to 25%.
+Added: Additional trade actions and retaliatory measures during 2025 contributed to further volatility in our component costs and supply chain planning.
+Added: These tariffs increased our input costs, constrained our ability to pass through pricing to customers, and reduced our margin predictability.
+Added: Drone and Unmanned Aerial Vehicles ( “ UAVs ” ) Demand Trends
+Added: In contrast to the policy-sensitive EV market, the drone market demonstrated more durable demand characteristics during 2025.
+Added: Increased focus on supply-chain security and national security considerations supported interest in domestically manufactured drone and UAV systems.
+Added: Recent federal regulatory actions discussed under “Government Regulation” below and procurement preferences limiting the use of foreign-manufactured drones in federal government and government-adjacent applications have contributed to demand for U.S.-based alternatives in select markets.
+Added: According to a market analysis prepared by Grand View Research, the global drone market size was valued at $73.1 billion in 2024 and is projected to growth at a compounded annual growth rate of 14.3% to 2030 and the U.S.
+Added: drone market specifically was valued at $25.1 billion in 2024 and is projected to more than double by 2030 to approximately $52.5 billion.
+Added: AI Infrastructure Demand Trends
+Added: Separately, the rapid adoption of AI technologies is expected to drive significant growth in demand for data center infrastructure.
+Added: Industry forecasts indicate that U.S.
+Added: data center power demand is increasing at a pace that exceeds historical norms, driven primarily by AI-related compute workloads.
+Added: For example, BloombergNEF projected that U.S.
+Added: data center power demand could reach approximately 106 gigawatts by 2035.
+Added: In addition, Goldman Sachs Research forecasts data center power demand rising by approximately 175% by 2030 relative to 2023, driven by pervasive AI workloads and infrastructure expansion.
+Added: The International Energy Agency (IEA) also reported that global data center electricity demand is expected to more than double by 2030, with accelerated servers (mainly AI workloads) driving a significant share of demand increases.
+Added: As a result, we consider the availability of reliable power, speed of deployment, and integration of power and hardware systems to be critical constraints for data center expansion.
+Added: We have seen these dynamics contribute to increased focus on infrastructure solutions to support power-intensive computing environments, including configurations that reduce reliance on traditional grid expansion timelines.
+Added: Products and Segments
+Added: We develop and deploy power-backed hardware systems across multiple end markets that require reliable energy delivery, integrated hardware, and system-level execution.
+Added: Our activities are organized around a common foundation of power management, electrification, and hardware-software integration.
+Added: As of the end of 2025, our operations and development initiatives are focused on the following areas:
+Added: (i) commercial EVs, (ii) drone systems, and (iii) medical supplies.
+Added: In addition, at the beginning of 2026, we announced a new strategic focus on the development and deployment of power-driven computing and data infrastructure designed to support high density, compute intensive workloads.
+Added: In early 2026, we announced a strategic initiative focused on the development and deployment of modular, power-backed computing infrastructure to support high-density artificial intelligence and advanced computing workloads.
+Added: Our planned offerings include containerized data center modules integrating dedicated power generation (including natural gas and alternative energy sources), electrical distribution equipment, thermal management systems, and rack-level high-performance compute hardware.
+Added: We intend to pursue this strategy through a combination of internal development, strategic partnerships, and potential joint ventures.
+Added: Following commercialization, our role is expected to include system design, power integration, project development, and deployment execution.
+Added: These systems are expected to incorporate commercially available central processing units (“CPUs”) and, in future configurations, graphics processing units (“GPUs”) capable of supporting AI and other advanced compute workloads.
+Added: These platforms are intended to be deployable in traditional data center environments as well as distributed or site-constrained locations where power availability, reliability and speed of deployment are critical considerations.
+Added: We do not intend to design or manufacture semiconductor components.
+Added: We are evaluating both grid-connected and off-grid power solutions to support these deployments, including on-site generation and hybrid configurations designed to enhance uptime and reduce reliance on extended grid interconnection timelines.
+Added: Power strategies that are currently under our consideration include clean natural gas–based generation and other reliable energy sources, subject to regulatory and permitting requirements, as discussed under “Governmental Regulation” below.
+Added: We believe that access to cost-effective and dependable power infrastructure is a key constraint facing data center expansion and AI compute deployment in the U.S.
+Added: Potential customers for these solutions may include hyperscale operators, government agencies, and commercial enterprises seeking secure, power-resilient computing infrastructure.
+Added: In addition, we may evaluate opportunities to utilize excess compute capacity for internally managed workloads, including digital asset–related applications, as part of an overall infrastructure utilization strategy.
+Added: These initiatives remain in research and development, and we have not yet commenced commercial sales.
+Added: Drone Systems
+Added: During 2025, we initiated research and development efforts in the drone systems market, leveraging our power management, hardware integration, and electrification expertise but have not yet begun offering our drone products as of the end of 2025.
+Added: We are developing a heavy-lift drone platform designed to carry payloads of approximately 500 pounds.
+Added: This platform is intended to be manufactured in the U.S.
+Added: and is being designed primarily for agricultural, fire suppression, and forestry applications, including precision spraying and related use cases.
+Added: We believe that recent federal regulatory actions discussed under “Government Regulation” below and procurement preferences limiting the use of certain foreign-manufactured drones have created an opportunity for domestically produced alternatives in agricultural and federally funded projects.
+Added: We are developing a drone platform to provide greater payload capacity, durability, and operational flexibility than our competitors.
+Added: In addition to agricultural applications, we are designing our drone platform to support fire suppression and forestry management use cases, including the transport and deployment of water or fire retardant materials.
+Added: We are also evaluating the integration of advanced software capabilities, including geospatial mapping, coordinated multi-drone operations (“swarming”), and AI–enabled applications to support data-driven operations in complex environments.
+Added: These drone products and associated software systems remain in development, and we have not yet commenced commercial manufacturing or sales in this segment.
+Added: In February 2025, we engaged a drone manufacturer for the manufacture of a U.S.-made heavy-lift drone in accordance with our detailed specifications and, following delivery of the drone, for transfer of the associated intellectual property rights.
+Added: This initial heavy-lift drone is purpose-built for the agricultural market, with advanced spraying and mapping functionality.
+Added: As part of our business strategy, following delivery of the model drone, we intend to open our U.S.
+Added: drone manufacturing facility and commence commercial sales, subject to applicable regulatory approvals.
+Added: Commercial Electric Vehicles
+Added: Our commercial EV segment includes purpose-built electric vans, trucks, buses, and specialty vehicles designed for fleet, municipal, and institutional customers.
+Added: These vehicles are manufactured through third-party OEMs located in China and Malaysia, followed by a Company-led final assembly and integration processes, and then marketed, sold, warrantied and serviced through our service and distribution network.
+Added: Our vehicles include options for telemetry for remote monitoring, electric power-export and various levels of grid-connectivity.
+Added: Our zero-emission products may also grow to include automated charging infrastructure and “intelligent” stationary energy storage that enables fast vehicle charging, emergency back-up facility power, and access to the developing, grid-connected opportunities for the aggregate power available from groups of large battery packs.
+Added: During 2025, in response to market conditions—including reduced federal and state incentives to support the EV market, substantial increases in import tariffs on certain components, including tariffs exceeding 100% on selected parts and subassemblies sourced from Asia, and reduced profit margins due to cost pressure—we have moderated the pace of expansion within this segment.
+Added: We remain focused on commercial use cases where electrification provides a measurable return on investment, particularly in jurisdictions with established incentive programs such as New Jersey and California.
+Added: Medical Supplies (Maddox Industries)
+Added: We maintain U.S.-based production capabilities through our wholly owned subsidiary, Maddox Industries that are focused on fulfilling our subcontract with Maddox Medical for medical supplies for government use.
+Added: While our medical supplies segment is not a primary growth area for us, our manufacturing operations for medical supplies provide operational validation of our ability to design, deploy, and manage semi-automated manufacturing processes within regulated environments.
+Added: We believe this capability supports our broader strategy by demonstrating U.S.-based production capacity, supply chain compliance, and disciplined execution and operational control in support of government contracts.
+Added: Our strategy is focused on building a diversified, power-backed hardware and infrastructure platform centered on markets where energy availability, compute density, and execution capability are critical constraints.
+Added: In response to market conditions during 2025, we refined our strategic priorities to emphasize scalable infrastructure, margin durability, and selective acquisition-driven expansion.
+Added: Our strategy is guided by the following pillars:
+Added: Establish Power-Driven AI Data Infrastructure as the Core Growth Platform.
+Added: One strategic focus that we view as a key area of growth for our company is the development and deployment of power-driven computing and data infrastructure capable of supporting high-density AI workloads.
+Added: We believe that accelerating demand for AI compute has created a structural imbalance between compute demand and available infrastructure, particularly with respect to power availability, cooling capacity, and deployment speed.
+Added: Our strategy is to address these constraints by integrating compute hardware, power systems, and thermal management into cohesive AI infrastructure solutions.
+Added: We intend to pursue deployments utilizing grid-connected, off-grid, or hybrid power configurations, including on-site generation where permitted, with the objective of maximizing uptime and operational reliability.
+Added: During the first quarter of 2026, we initiated our evaluation and development of data center infrastructure utilizing advanced cooling technologies, including liquid immersion cooling, to support high-density compute environments.
+Added: Pursue Strategic Acquisitions to Accelerate Scale, Access, and Capability .
+Added: As part of our growth strategy, we are evaluating strategic acquisitions, mergers, and other business combinations within the AI, GPU, and data infrastructure ecosystem.
+Added: These potential transactions are intended to accelerate our access to advanced compute hardware, supply chain priority, technical expertise, and established customer relationships.
+Added: We also intend to evaluate additional opportunities to vertically integrate or consolidate complementary assets and businesses across the AI, compute, and data infrastructure value chain, subject to market conditions, financing availability, and regulatory considerations.
+Added: Integrate Power Infrastructure with Compute Deployment .
+Added: A central element of our strategy is the integration of power infrastructure with compute deployment.
+Added: We believe that access to reliable, cost-effective energy is becoming a primary bottleneck for data center expansion.
+Added: Accordingly, we are pursuing strategies that combine compute infrastructure with dedicated power solutions, including on-site generation and hybrid power models.
+Added: During 2025, we advanced initiatives related to securing power resources and evaluating infrastructure build-outs in select U.S.
+Added: regions, including South Texas, where energy availability and industrial development support data center deployment.
+Added: These initiatives are intended to support scalable, long-term infrastructure development aligned with customer demand.
+Added: Maintain Disciplined Exposure to Commercial Electric Vehicles .
+Added: We continue to support our commercial EV operations and customer base.
+Added: However, in light of market conditions discussed above, we have moderated the pace of expansion within this segment.
+Added: Our EV strategy emphasizes commercial use costs where electrification provides a measurable return on investment, while prioritizing capital allocation toward higher-margin, power-driven infrastructure initiatives.
+Added: Develop Complementary Hardware Platforms with Lower Policy Dependence .
+Added: We are exploring opportunities to develop complementary hardware platforms, including drone systems, that leverage our expertise in power systems and hardware integration.
+Added: These initiatives are intended to diversify revenue opportunities and reduce reliance on policy-dependent market segments.
+Added: Execute with Capital Discipline and Phased Deployment .
+Added: We intend to execute our strategy through a phased deployment model that emphasizes technical validation, customer alignment, and capital efficiency.
+Added: Investments will be prioritized based on margin potential, scalability, and alignment with our core power-driven infrastructure thesis.
+Added: We will continue to evaluate partnerships, acquisitions, and financing structures that support disciplined growth while maintaining flexibility to adapt to market conditions.
+Added: Manufacturing, Operations, and Facilities
+Added: We maintain an operational footprint designed to support the development, integration, and deployment of power-backed hardware systems across our core business lines.
+Added: Our manufacturing and operations strategy emphasizes proximity to skilled labor, access to energy infrastructure, supply chain efficiency, and logistical connectivity to customers and partners.
+Added: Transition of Manufacturing and Operations
+Added: During 2025, we undertook a strategic evaluation of our manufacturing and operational footprint.
+Added: As part of this process, we discontinued our plans to further expand operations in Arkansas and relocated our primary corporate, manufacturing, and operational activities to Houston, Texas.
+Added: Our decision to exit Arkansas was driven by a combination of operational and economic considerations, including the condition and cost structure of available facilities, limitations on workforce availability for specialized technical and manufacturing roles, logistical constraints, and the overall scalability of operations in a remote geographic location.
+Added: While we had previously explored the potential for expanded operations in Arkansas, we ultimately determined that this location did not align with our long-term operational requirements or growth objectives.
+Added: The transition of our operations from Arkansas to Houston, Texas is still ongoing and is expected to be complete in the first half of 2026.
+Added: Establishment of Houston, Texas as the Primary Operating Hub
+Added: We selected Houston, Texas as our primary operating hub based on our strategic advantages as a major energy, industrial, and logistics center.
+Added: Houston serves as a global hub for the energy, power, and industrial sectors.
+Added: The region provides direct access to natural gas infrastructure, refineries, pipelines, and energy counterparties, as well as a deep ecosystem of suppliers and service providers relevant to power-intensive infrastructure projects.
+Added: Workforce and Operational Scale
+Added: Since relocating operations to Houston, we have expanded our workforce and operational capacity.
+Added: We believe the region offers a large, educated, and skilled labor pool across engineering, manufacturing, information technology, energy systems, and industrial operations.
+Added: We have been able to recruit personnel across a broad range of technical and operational disciplines necessary to support our evolving business lines.
+Added: We have scaled our workforce significantly compared to prior periods and have established multiple functional operations in the Houston area, including corporate headquarters, manufacturing and assembly operations, drone testing facilities, logistics, and warehousing.
+Added: We have implemented multiple assembly and production lines to support our medical supplies manufacturing and hardware integration activities.
+Added: Operational Alignment with Strategic Focus
+Added: Our relocation to Houston aligns with our strategic emphasis on power-driven infrastructure, AI data center development, and advanced hardware systems.
+Added: Houston’s position within the U.S.
+Added: energy corridor supports our efforts to integrate compute infrastructure with reliable power solutions, including natural gas-based generation and hybrid power models.
+Added: The region also supports collaboration with energy producers, infrastructure developers, and industrial customers.
+Added: Our current facilities include corporate headquarters located in downtown Houston, Texas, as well as manufacturing, assembly, testing, logistics, and warehousing facilities within the greater Houston metropolitan area.
+Added: These facilities are intended to support current operations and provide flexibility for future expansion as market conditions and strategic initiatives evolve.
+Added: Our 86,000 square foot facility in Houston is subleased from Maddox Defense, Inc.
+Added: ("Maddox Defense"), of which Jason Maddox, our President and Interim Chief Financial Officer is the sole stockholder, with a three-year term (with renewal options), for approximately $20,000 per month.
+Added: During 2025, we undertook a strategic evaluation of our manufacturing and operational footprint.
+Added: As part of this process, we discontinued our plans to further expand operations in Arkansas and relocated our primary corporate, manufacturing, and operational activities to Houston, Texas.
+Added: The transition of our operations from Arkansas to Houston is still ongoing and is expected to be complete in the first half of 2026.
Our Customers
−Removed: Our current primary focus is Class 3 to 5 trucks, Class 3 and 4 cargo vans and school buses.
−Removed: Our ta rget customers primarily include public and private fleet operators that have an interest in meeting or exceeding local, state and federal emission regulatory guidelines while saving money on fuel and maintenance costs over the lifecycle of their fleet vehicles and that also have an interest in tangible demonstrations of their GHG-reducing efforts.
−Removed: These targets include:
−Removed: Public and private schools that operate “white fleet” vehicles for non-student transportation use, such as facility service trucks, food service delivery vans/trucks, campus security vehicles and golf cart-type vehicles.
−Removed: Commercial fleet operators that provide high daily mileage vehicles for use on routes in and around airports, hotels and offsite parking facilities.
−Removed: Last mile delivery companies with fleets of delivery vans, short haul trucks and distribution/sorting facility center vehicles.
−Removed: Large agricultural and food processing industry-focused companies that operate Class 1 through 7 trucks, buses and/or delivery vans.
−Removed: Public and private transportation services that are involved in prisoner transportation.
−Removed: Large companies that operate shuttle buses, transit style buses and facility-based vehicles, including on and off road-type vehicles for employee transport to/from remote parking areas, to/from special events, and the various vehicles used for facilities maintenance, services and security.
−Removed: Private transportation contractors that shuttle large companies’ employees from common public transportation hubs to their campuses.
−Removed: Public and private colleges and universities that operate shuttle buses, transit-style buses, facility service vans and trucks and utilize golf cart-type vehicles on their campuses.
−Removed: Community-based, public/privately funded shuttle buses serving special-needs community members.
−Removed: Retirement communities, municipalities, shopping malls, movie studio lots, and large warehouse facilities that currently use golf cart-type vehicles for moving people and goods.
−Removed: The current market of approximately 3.5 million e-trike users in the Philippines, most of which currently operate gasoline or diesel- powered vehicles.
−Removed: Public and private K-12 schools that operate Type-A, C and D school buses, and special-needs student buses.
−Removed: Student transportation contractors that serve public and private schools.
−Removed: Port, railway and distribution center operators that use traditionally-fueled loading equipment, tractors, material handling equipment, forklifts, Class 1 through 7 trucks, delivery vans, yard goats, and other similar vehicles, that could be replaced with zero-emission alternatives.
−Removed: Mining companies with fleets of above-ground service vehicles and underground staff transport and support vehicles.
−Removed: Oil and gas companies with fleets of field trucks.
−Removed: Electric utility companies with fleets of service trucks that are in the public eye.
−Removed: Military-based fleet operators that have non-combat fleet vehicles of all sizes.
−Removed: Our Products and Services
−Removed: Our products and services primarily include purpose-built, zero-emission vehicles a nd chassis of all sizes manufactured by OEMs, and are marketed, sold, warrantied and serviced thro ugh our developing distribution and service network.
−Removed: We engage OEMs to design and supply vehicles for us that meet our specifications.
−Removed: In addition, our products and services may in the future include some or all of the following:
−Removed: Zero-emission electric systems for ship-through integration by outside OEMs into their own privately branded medium to heavy-duty commercial fleet vehicles.
−Removed: Automated charging infrastructure for commercial fleet vehicles.
−Removed: “Intelligent” stationary energy storage that enables fast vehicle charging.
−Removed: “Intelligent” stationary energy storage that enables emergency back-up facility power during grid power outages.
−Removed: “Intelligent” stationary energy storage that enables access to the developing grid-connected opportunities for the aggregate power available from groups of large battery packs.
−Removed: “Intelligent” stationary energy storage that enables avoidance of electric utility demand charges for commercial customers integrated with or independent of Envirotech-supplied, zero-emission fleet vehicle(s).
−Removed: Energy storage systems (battery packs) replacements with better energy density and/or expected lifecycles for existing electric vehicles and equipment that has outlived their OEM-provided energy storage systems.
−Removed: For example, replace flooded lead acid (“FLA”) battery packs of existing industrial forklifts and underground mining equipment with more energy dense and higher cycle-life battery packs composed of lithium-ion cells.
−Removed: Our suppliers are vetted before their products are accepted for use in our products.
−Removed: Our drivetrain systems and finished products are inspected, road-tested (when applicable) and receive quality control testing prior to delivery.
−Removed: Customer Service, Support and Training
−Removed: Our sales team has historically been used as the first point of customer contact for customer support and training.
−Removed: We are hiring sales personnel and other internal staf f currently to su pport our current and planned operations.
−Removed: Zero-emission electric drivetrain systems for purpose-built new vehicles generally include the following:
−Removed: electric traction motor/generator of sufficient kW power for grade, speed, acceleration and efficiency requirements, a motor controller/inverter system that modulates electrical power flow between the battery packs and traction motor, a gear reduction system or multispeed transmission, systems to electrify power steering/brakes, a VCU, high-voltage traction battery packs with integrated BMS, battery disconnect units, thermal management systems, vehicle charging hardware, electric HVAC systems, DC to DC inverter(s) to reduce traction battery pack voltage sufficient to operate on-board, low voltage systems, wiring harnesses, user/driver interface and remote diagnostic/tracking/fault code/data logging systems.
−Removed: Although clear industry power-export standards have not yet been adopted, systems and options for a variety of vehicle-to-other power management options (such as grid, building, stationary energy storage, etc.) are being developed by multiple vendors and their inclusion may be offered as additional cost options in the future.
−Removed: Sales and Marketing
−Removed: We intend to build out our marketing and sales network by hiring sales personnel to form a team of dedicated sales employees with responsibility for each of the geographic regions we serve.
−Removed: We plan to focus our marketing efforts on increasing brand awareness, generating demand for our products, communicating product advantages and generating qualified leads for our sales force.
−Removed: We intend to rely on a variety of marketing vehicles, including our website and social media, participation in industry conferences and trade shows, public relations and our collaborative relationships with our business and teaming partners to share our technical message and the benefits of our product offering, with customers.
−Removed: Manufacturing
−Removed: We currently contract with third-party suppliers to manufacture our products.
−Removed: In 2022, we increased our integration efforts and began completing the final assembly of sub-assembly components at our Osceola, Arkansas, facility.
−Removed: We also intend to install the manufacturing equipment in Osceola required to begin producing our vehicles ourselves in the United States, which will be a key step towards our longer-term strategy of becoming a fully integrated electric vehicle manufacturer.
−Removed: Envirotech Electric Vehicles Incorporated ("EEVI")
−Removed: EEVI is a Canadian company engaged in the design, prototyping and certification of electric components and vehicles, including complete drivetrain systems.
−Removed: Previously, we engaged EEVI to design and supply a series of zero-emission electric Class 3 and 6 trucks, cargo vans and chassis built to our specifications and requirements.
−Removed: The vehicles are initially comprised of a cab, chassis and electric drivetrain system.
−Removed: Any customer can then customize the trucks by adding a box or stake bed to the vehicle in accordance with their needs.
−Removed: We received the first truck and cargo van pursuant to our arrangement with EEVI.
−Removed: As the dealer for EEVI, we submitted additional information to the HVIP Department of CARB and received our HVIP listing in November 2019, which renders the trucks and vans eligible for buy-down funding based on the gross vehicle weight rating ("GVWR").
−Removed: We also own certain rights under an Exclusive Supply Agreement entered into with EEVI (the “Exclusive Distribution Agreement”).
−Removed: Pursuant to the Exclusive Distribution Agreement, EEVI appointed us as the exclusive distributor of all of EEVI’s products in the United States on the terms and subject to the conditions set forth therein.
−Removed: Unless earlier terminated in accordance with the terms thereof, the Exclusive Distribution Agreement will remain in effect for a term expiring on December 17, 2070.
−Removed: The Exclusive Distribution Agreement provides us certainty of product supply and consistency of design between different classes or type of vehicles;
−Removed: allows us to license the products to third party resellers, distributors and others which should enhance our ability to sell vehicles and permits us to use trademarks associated with the vehicles, all of which we believe is very advantageous to executing our business plan.
−Removed: Raw Materials and Supply Chain
−Removed: Prices for the systems, components and raw materials we use in our vehicles and drivetrain systems, many of which are OEM items used by many companies in different applications, can fluctuate depending on market conditions and global demand.
−Removed: Our purchase of raw materials is currently limited due to sales volume, but we attempt to limit our exposure to raw material price increases and availability fluctuations by having relationships with a dynamic group of vendors that sell us value-added hardware, components and systems.
−Removed: We have further mitigated these supply chain risks by establishing purchasing relationships with multiple vendors that are diversified by type of product offered, brand of products offered, country of origin of products (which is relevant for “Buy American” provisions that we encounter with our customers), individual specification requirements, purchase quantity requirements, quality, availability and price.
−Removed: Our drivetrain systems allow for component substitution, which further mitigates our exposure to any one supplier or component.
−Removed: We believe that we have adequate supplies and access to the sources of the systems, components and materials to meet our current and anticipated future production and supply requirements.
−Removed: As of December 31, 2024 , we had a backlog of two zero-emission Class 4 trucks and 42 zero-emission Class 4 cargo vans, which consists of unfilled firm orders for products undersigned contracts with customers.
−Removed: As of December 31, 2024 , we h a d 22 employees in total, whi c h are all full-time employees.
−Removed: None of our employees were covered by collective bargaining agreements and we believe our employee relations are good.
−Removed: The electric vehicle market has experienced significant turbulence, with numerous companies facing financial challenges, restructuring, or ceasing operations altogether.
−Removed: The electric vehicle market remains highly competitive, with both established manufacturers and new entrants striving to capture market share.
−Removed: Traditional automotive companies, such as Ford and General Motors, continue to invest heavily in electric vehicle development despite facing operational challenges.
−Removed: Newer companies like Rivian are working to overcome production hurdles to establish a foothold in the market.
−Removed: The recent bankruptcies and operational difficulties among several electric vehicle startups highlight the volatility and capital-intensive nature of the industry.
−Removed: As the market evolves, companies with robust financial backing, scalable production capabilities, and strong strategic partnerships are better positioned to navigate the challenges inherent in the electric vehicle sector.
+Added: Our customer engagement strategy is designed to align each of our business lines with customers whose operational requirements, procurement processes, and economic drivers are well suited to our potential power-backed hardware platforms.
+Added: We focus on customers with mission-critical use cases, high utilization requirements, and long-term infrastructure or equipment needs.
+Added: AI Data Infrastructure
+Added: Our power-driven computing and data infrastructure initiatives are intended to serve customers requiring reliable, high-density computing environments where access to power, uptime, and deployment speed are critical constraints.
+Added: Our target customer categories for this business line are intended to be:
+Added: Hyperscale and cloud service providers seeking incremental or distributed compute capacity to support AI, machine learning, and data-intensive workloads, particularly in regions where grid access or power availability limits traditional data center expansion;
+Added: Government agencies and government-adjacent entities requiring secure, resilient computing infrastructure for data processing, analytics, modeling, simulation, and mission-critical applications, including customers subject to data security and domestic infrastructure considerations;
+Added: Enterprise and commercial customers operating compute-intensive workloads, including energy, industrial, logistics, and technology-driven businesses, where power reliability, latency, or geographic placement is a key operational requirement;
+Added: Infrastructure developers and strategic partners seeking integrated power-and-compute solutions for data center development, including customers evaluating hybrid, off-grid, or dedicated power configurations.
+Added: We expect that customer engagements in AI compute business will typically involve extended evaluation and planning cycles and may include discussions related to long-term capacity requirements, power sourcing, site development, cooling technologies, and infrastructure integration.
+Added: These initiatives remain in development, and we have not yet commenced commercial sales or recognized revenue from any AI data infrastructure deployments.
+Added: Drone Systems (Agricultural, Fire, and Forestry Applications)
+Added: Our drone systems initiatives are focused on the development of heavy-lift, industrial-grade drone platforms designed for demanding commercial and public-sector applications.
+Added: Our target customer categories for this segment include:
+Added: Large-scale agricultural operators and agricultural service providers, including farms and contractors engaged in precision agriculture, crop spraying, fertilization, and related operations, where high payload capacity, durability, and operational efficiency are critical;
+Added: Forestry management organizations, including public and private land managers, seeking aerial platforms for vegetation management, monitoring, and environmental operations;
+Added: Fire suppression and emergency response organizations, including state and local fire authorities and related agencies, evaluating aerial platforms for fire suppression, delivery of water or fire retardant, and situational awareness in hazardous environments;
+Added: Government and government-adjacent customers subject to domestic sourcing requirements or procurement preferences favoring U.S.-manufactured unmanned systems.
+Added: During 2025, following our public announcement of our heavy-lift agricultural drone development program, we engaged with prospective customers regarding anticipated operational requirements and use cases.
+Added: In connection with these early engagements, we received limited, refundable customer deposits from certain prospective customers seeking priority access to initial production units once the platform becomes commercially available.
+Added: These deposits are intended to secure a position in a prospective delivery queue and do not constitute firm purchase commitments, backlog, or guaranteed delivery timelines.
+Added: No revenue has been recognized in connection with these deposits, and we have not commenced commercial manufacturing or sales of drone products.
+Added: Commercial Electric Vehicles
+Added: Our commercial EV customers primarily include:
+Added: Fleet operators, including delivery, logistics, and service fleets with centralized operations and predictable duty cycles;
+Added: Municipalities and public agencies, including utilities, ports, and school districts, seeking to reduce emissions and operating costs through electrification;
+Added: Institutional and commercial customers with specific operational requirements where EVs provide a clear return on investment.
+Added: Sales in this segment are driven by defined use cases and are often influenced by the availability of state or local incentive programs.
+Added: During 2025, customer purchasing behavior became more selective, with extended sales cycles and heightened sensitivity to total cost of ownership.
+Added: We continue to support our existing vehicle lineup and customer relationships while prioritizing deployments where electrification provides measurable economic benefits.
+Added: Manufacturing, Product Delivery and Service Model
+Added: We manufacture and deliver our products and services through a combination of in-house system assembly, system integration, and development activities, supported by third-party manufacturing partners and strategic suppliers.
+Added: Our delivery and service model is tailored by business line and is designed to maintain control over product specifications, performance standards, and compliance requirements while preserving operational flexibility and capital efficiency.
+Added: Commercial Electric Vehicles
+Added: For the manufacture of our commercial EVs, we utilize a semi-knocked-down (“SKD”) assembly model in which vehicles are produced to our designs, technical specifications, and component requirements.
+Added: Under this model, vehicle chassis, bodies, and subassemblies are sourced from the OEMs located in China and Malaysia and delivered in SKD form, after which we perform final assembly, integration, and configuration.
+Added: Our SKD assembly process includes the integration of Company-specified components and systems, which may include powertrain elements, battery systems, electrical architecture, software, telematics, and application-specific hardware, depending on vehicle class and customer requirements.
+Added: This approach allows us to maintain control over vehicle design standards, performance specifications, regulatory compliance, and quality assurance while leveraging external manufacturing capacity.
+Added: In addition to final assembly, we support customers through vehicle customization, delivery coordination, and post-delivery service arrangements.
+Added: Service and support activities may include maintenance coordination, parts support, and technical assistance, provided directly by us or through qualified third-party service providers.
+Added: Drone Systems
+Added: Our drone systems activities are currently focused on product design, engineering, and development.
+Added: We are developing heavy-lift, industrial-grade drone platforms intended for agricultural, fire suppression, and forestry applications.
+Added: These products are being designed for U.S.-based manufacturing and are not yet in commercial production.
+Added: Commercial manufacturing, sales, and post-delivery support models have not yet been finalized and will depend on product readiness, regulatory approvals, and market demand.
+Added: AI Data Infrastructure
+Added: Our initiatives related to power-driven computing and data infrastructure are currently in the development and planning phase.
+Added: These activities include system design, infrastructure planning, power integration, thermal management evaluation, and customer engagement related to high-density compute deployments.
+Added: Future delivery models may include integrated hardware deployment, infrastructure development, power integration, and ongoing operational support, subject to customer requirements, regulatory considerations, and capital availability.
+Added: We have not yet commenced commercial sales or recognized revenue related to these initiatives.
+Added: Medical Supplies (Maddox Industries)
+Added: Through our wholly owned subsidiary, Maddox Industries, we maintain U.S.-based, semi-automated manufacturing capabilities to produce medical supplies for Maddox Medical in support of its government contracts.
+Added: While Maddox Industries is not a primary growth segment for us, its operations provide operational validation of our ability to design, deploy, and manage semi-automated manufacturing processes within regulated environments.
+Added: We believe these capabilities support our broader manufacturing strategy by demonstrating execution discipline, domestic production capacity, and compliance with government procurement requirements.
+Added: Manufacturing and Service Flexibility
+Added: Across all business lines, our product delivery and service model emphasizes disciplined execution, modular deployment, and adaptability to customer and market requirements.
+Added: We may adjust our delivery, assembly, and service approaches over time based on operational scale, customer needs, and strategic priorities.
+Added: Marketing Approach and Sales Cycles
+Added: Across all business lines, our marketing activities are primarily relationship-driven and technical in nature.
+Added: We do not rely on mass-market advertising and instead focus on direct engagement with customers, industry participants, and strategic partners.
+Added: Sales cycles vary significantly by segment and customer type and may range from several months to multiple years, particularly for infrastructure-related initiatives.
+Added: Marketing expenditures are managed conservatively and aligned with our strategic priorities and stage of development.
+Added: As of December 31, 2025 , we had a backlog of two zero-emission Class 4 trucks and 38 zero-emission Class 4 cargo vans, which consists of unfilled firm orders for products undersigned by contracts with customers.
+Added: As of December 31, 2025, we employed 293 full-time employees across our operations.
+Added: Our workforce currently supports commercial EV integration, medical supplies manufacturing, product development initiatives, power-driven infrastructure planning, manufacturing and assembly activities, logistics, and corporate and administrative functions.
+Added: During 2025, we significantly expanded our workforce, adding more than 250 manufacturing and machine-operator roles in connection with the relocation and scale-up of our manufacturing operations in Houston, Texas.
+Added: This expansion was undertaken to establish and support production capacity for our medical supplies segment.
+Added: In addition to manufacturing personnel, we added highly skilled technical staff, including production and manufacturing design engineers, electrical engineers, computer systems engineers, and logistics professionals to support system design, assembly processes, power management, automation, quality control, and infrastructure integration across our business lines.
+Added: Our workforce includes engineers, technicians, manufacturing and assembly personnel, machine operators, logistics and supply chain staff, information technology professionals, sales and business development personnel, and corporate management and administrative employees.
+Added: Certain functions may also be supported by contractors, consultants, or temporary labor, depending on project requirements and operational needs.
+Added: We are not a party to any collective bargaining agreements.
+Added: We place emphasis on workplace safety, regulatory compliance, training, and maintaining a professional work environment consistent with applicable labor laws and industry standards.
+Added: Our workforce size and composition may continue to evolve based on operational scale, product development progress, development and commercialization activity, and strategic priorities.
+Added: The markets in which we operate are highly competitive and characterized by rapid technological change, evolving regulatory environments, and shifting capital availability.
+Added: Competitive dynamics vary significantly across our business lines, and competitors range from large, well-capitalized enterprises to smaller, specialized technology providers.
+Added: Commercial Electric Vehicles
+Added: The commercial EV market has experienced significant contraction and consolidation in recent periods.
+Added: Competition in this segment includes established vehicle manufacturers, specialized EV developers, and integrators serving fleet and institutional customers.
+Added: During 2025, a number of EV-focused companies reduced operations, restructured, exited the market, or were delisted from public markets, due to capital constraints, margin pressure, and sensitivity to changes in policy and incentive programs.
+Added: Competition in the commercial EV segment is influenced by factors including total cost of ownership, availability of incentives, vehicle performance and reliability, service and support capabilities, and access to capital.
+Added: While competitive pressure remains, we believe that fewer participants, combined with increased selectivity by customers, has shifted the market toward use-case-driven deployments rather than broad adoption initiatives.
+Added: Drone Systems
+Added: The drone systems market includes a mix of domestic and foreign manufacturers offering products across a wide range of payload capacities and applications.
+Added: In agricultural and industrial use cases, competition has historically been dominated by foreign-manufactured platforms, particularly in smaller payload classes.
+Added: Recent regulatory and procurement trends discussed above have altered the competitive landscape in certain markets, particularly for use of drones by federal agencies and federally funded projects.
+Added: We believe that these developments have reduced the number of viable suppliers for high-payload, industrial-grade drone systems intended for agricultural, fire suppression, and forestry use cases.
+Added: Competition in this segment is driven by payload capacity, durability, operational reliability, software integration, and regulatory compliance.
+Added: Many competitors offer lighter-duty systems that may not address the operational requirements of large-scale or industrial applications targeted by our development efforts.
+Added: AI Data Infrastructure
+Added: The power-driven computing and data infrastructure market is highly competitive and includes large technology companies, data center developers, infrastructure providers, and specialized system integrators.
+Added: Competition is influenced by access to computing hardware, availability of reliable power, speed of deployment, and ability to support high-density workloads.
+Added: We believe that demand for AI-driven compute infrastructure has intensified competition for power resources and suitable sites, particularly for large-scale deployments.
+Added: In this environment, competitive differentiation increasingly depends on the ability to integrate compute systems with reliable power solutions, advanced cooling technologies, and scalable infrastructure.
+Added: Barriers to entry include capital requirements, supply chain access, technical expertise, and regulatory approvals.
+Added: Competitive Positioning
+Added: Across our business lines, we compete based on our ability to integrate power systems, hardware, and software into cohesive solutions tailored to specific operational requirements.
+Added: We believe our experience in power management, electrification, system integration, and domestic manufacturing provides a competitive foundation, particularly in markets where reliability, compliance, and execution capability are critical.
+Added: However, we compete with entities that may have greater financial, technical, or operational resources, and increased competition could adversely affect pricing, margins, and market share.
+Added: We expect competitive conditions to continue to evolve as markets mature, technologies advance, and regulatory frameworks change.
+Added: Our business relies on a combination of proprietary designs, engineering know-how, system integration expertise, software development, and licensed or third-party technologies.
+Added: Our intellectual property strategy is focused on protecting critical elements of our designs and processes while maintaining flexibility to incorporate third-party components and technologies where appropriate.
+Added: Technology Platform
+Added: Our technology platform is centered on power-backed hardware systems, including electrification, power management, thermal regulation, and integrated hardware-software architectures.
+Added: These capabilities are applied across our commercial EVs, unmanned aerial systems, and power-driven computing and data infrastructure business lines.
+Added: Core technical competencies include:
+Added: Power system design and integration;
+Added: Electrical architecture and controls;
+Added: Hardware-software integration;
+Added: Thermal management and cooling solutions;
+Added: System-level design for reliability and uptime;
+Added: Manufacturing process design and automation.
+Added: Commercial Electric Vehicles
+Added: For our commercial EVs, we develop and maintain vehicle designs, performance specifications, and system requirements that are implemented through our SKD assembly model.
+Added: We specify key vehicle attributes, components, and system integrations, including battery systems, powertrain elements, electrical architecture, telematics, and application-specific hardware.
+Added: While certain vehicle components and subassemblies are sourced from third-party OEMs, we retain control over system-level design, integration standards, quality requirements, and regulatory compliance.
+Added: Our intellectual property in this area consists primarily of proprietary design documentation, engineering specifications, software configurations, and integration processes rather than patents on individual components.
+Added: Drone Systems
+Added: Our drone systems involve the design and development of heavy-lift, industrial-grade drone platforms intended for agricultural, fire suppression, and forestry applications.
+Added: Technology development efforts in this area include:
+Added: Airframe and structural design optimized for heavy payloads;
+Added: Power and propulsion system integration;
+Added: Flight control systems and redundancy architecture;
+Added: Payload deployment mechanisms;
+Added: Software and control systems for autonomous and semi-autonomous operation.
+Added: We are also evaluating and developing advanced software capabilities, including geospatial mapping, coordinated multi-drone operations (“swarming”), and AI-enabled sensing and analytics.
+Added: These technologies remain in development, and we have not yet commenced commercial production or sales of drone products.
+Added: AI Data Infrastructure
+Added: Our power-driven computing and data infrastructure initiative involves the design and integration of high-density computing platforms and supporting infrastructure.
+Added: These efforts focus on:
+Added: Modular computing architectures utilizing CPUs and, in future configurations, GPUs;
+Added: Integration of computing hardware with reliable power systems;
+Added: Thermal management solutions, including advanced cooling technologies;
+Added: Infrastructure layouts designed for scalability, uptime, and efficiency.
+Added: The goal of our technology development in this area emphasizes system integration rather than development of proprietary semiconductor technologies.
+Added: We expect to rely on a combination of commercially available computing hardware, licensed software, and proprietary integration methodologies.
+Added: Medical Supplies (Maddox Industries)
+Added: Through our wholly owned subsidiary Maddox Industries, we have developed manufacturing process knowledge related to semi-automated production, quality control, and compliance with government contracting requirements.
+Added: This know-how includes production line design, automation workflows, documentation, and process controls.
+Added: While our processes are not protected by patents, we consider this operational expertise to be valuable.
Intellectual Property
−Removed: The protection of our technology and intellectual property is an important component of our success.
−Removed: We rely on intellectual property laws, including trade secret, copyright, trademark and patent laws in the United States and abroad, and use contracts, confidentiality procedures, non-disclosure agreements, employee disclosure and invention assignment agreements and other contractual rights to protect our intellectual property.
−Removed: We maintain a trademark portfolio including common law trademarks and service marks and have three service marks registered and two trademark registrations in the United States.
−Removed: Circumstances outside of our control could pose a threat to our intellectual property rights.
−Removed: Effective intellectual property protection may not be available in the United States or other countries in which we provide our solution.
−Removed: In addition, the efforts we have taken to protect our intellectual property rights may not be sufficient or effective.
−Removed: Any impairment of our intellectual property rights could harm our business, our ability to compete and harm our operating results.
−Removed: In addition, as the number of competitors grows and solutions of competitors overlap, we may in the future face claims by third parties that we infringe upon or misappropriate their intellectual property rights, and we may be found to be infringing upon or to have misappropriated such rights.
−Removed: In the future, we, or our customers, may be the subject of legal proceedings alleging that our solutions or underlying technology infringe or violate the intellectual property rights of others.
−Removed: Governmental Programs and Incentives
−Removed: We believe that the availability of government subsidies and incentives currently is an important factor considered by our customers when purchasing vehicles that utilize our technology, and that our growth depends in part on the availability and amounts of these subsidies and incentives.
−Removed: This is especially true over the next five to ten years.
−Removed: While the federal government previously allocated $5 billion for the Clean School Bus Program, another $5 billion for the National Electric Vehicle Infrastructure program, $3 billion over 5 years to establish a new grant program to install electrified equipment and reduce emission at ports and federal tax incentives, the status of this funding and several other related programs remains uncertain due to the current Trump administration’s change in policies and pause on any funding for any “Green New Deal” infrastructure under the IRA.
−Removed: While we do not yet know the nature of these policy changes, such changes may have a material and adverse effect on the implementation and continued existence of key electric vehicles support programs.
−Removed: Overview of Incentive Programs Most Applicable to Our Products
−Removed: We intend to have our products approved for various local, state and federal incentive programs, including those set forth below.
−Removed: In particular, California’s zero-emission vehicle mandate, which requires a percentage of an automobile manufacturer’s sales to be zero-emission vehicles, has resulted in numerous incentive programs designed to accelerate the purchase and/or repower of cleaner, more efficient vehicles in California.
−Removed: Clean Truck and Bus Voucher Incentive Project ( “ HVIP ” )
−Removed: HVIP is a CARB program administered by CALSTART, the purpose of which is to help speed the early market introduction of clean, low-carbon hybrid and electric trucks and buses.
−Removed: Under HVIP, dealers and fleet operators may request vouchers from HVIP on a first-come first-served basis, up to the funding amount available for that year, to reduce the cost of purchasing hybrid and zero-emission medium- and heavy-duty trucks and buses.
−Removed: It is a statewide program.
−Removed: On November 17, 2022, CARB approved the Fiscal Year 2022-23 Funding Plan for Clean Transportation Incentives, which included an allocation of over $1.7 billion to be administered by HVIP.
−Removed: On November 16, 2023, CARB approved the Fiscal Year 2023-2024 Funding Plan for Clean Transportation Incentives, which included an allocation of $80 million to be administered through HVIP.
−Removed: On November 21, 2024, CARB approved the Fiscal Year 2024-25 Funding Plan for Clean Transportation Incentives, which did not include any additional allocation funding to HVIP for Fiscal Year 2024-2025 due to limited funds and needs of other project categories.
−Removed: Funds from previous years are expected to support HVIP until the next budget appropriation.
−Removed: HVIP vouchers range in amounts depending on the gross vehicle weight of the purchased vehicle and the number of vehicles purchased.
−Removed: Zero-emission Class 3 trucks are currently eligible for up to $45,000 per vehicle.
−Removed: Class 4 and Class 5 vehicles are funded at the $60,000 per vehicle level and Class 6 and Class 7 vehicles are eligible for $85,000 per vehicle.
−Removed: Depending on project location (i.e.
−Removed: if in a disadvantaged area community census tract) those amounts can be increased to $51,750, $69,000 and $107,525 per vehicle, respectively.
−Removed: However, HVIP may also be revising per vehicle amounts available for future grant periods.
−Removed: HVIP funds the purchase of only fully commercialized hybrid and zero-emission trucks and buses.
−Removed: Vehicles still in the demonstration or evaluation stage are not eligible for inclusion in HVIP.
−Removed: Vehicle manufacturers must apply to have their hybrid and zero-emissions trucks and buses included in HVIP’s voucher program.
−Removed: Once a make and model is included in the program, the manufacturer is not required to submit a full application for the succeeding year’s program unless the vehicle has been modified.
−Removed: We intend to comply with the HVIP guidelines and continue to qualify our vehicles for the HVIP vouchers.
−Removed: New York Truck Voucher Incentive Program ("NYTVIP")
−Removed: NYTVIP is a first-come, first-served incentive program funded by the New York State Energy Research & Development Authority.
−Removed: The structure and process for fleets to secure incentives is similar to that of HVIP discussed above.
−Removed: Eligible vehicles include all-electric, hybrid-electric, and CNG trucks and buses.
−Removed: Funding for eligible vehicles domiciled in New York State can reach $385,000 per vehicle.
−Removed: Class 4 and 5 all electric trucks are eligible for up to $100,000 per vehicle and $125,000 per vehicle in funds respectively (i.e., up to 95% of the incremental cost over diesel).
−Removed: We were named an approved dealership in the summer of 2020, and our vehicles are included on the NYTVIP eligible vehicle list for the program.
−Removed: As of March 2024, the New York State Energy Research & Development Authority website reported $46.1 million in total funding availability under NYTVIP.
−Removed: New York School Bus Incentive Program ( “ NYSBIP ” )
−Removed: As of January 31, 2024, NYTVIP no longer funds school buses.
−Removed: Funding for zero emission school buses and charging equipment is now awarded separately through NYSBIP.
−Removed: In the 2022 budget, the New York State Legislature and Governor established a deadline for the transition to zero-emission school buses.
−Removed: Specifically, all school buses purchased in New York State must be zero-emission buses by 2027 and all school buses operating within the state must be zero-emission by 2035.
−Removed: Further, in 2022, voters across New Yorkers voted to approve the Clean Air, Clean Water and Green Jobs Environmental Bond Act (“Bond Act”), which includes $500 million to support the transition to zero-emission buses.
−Removed: New York State Energy Research & Development Authority established NYSBIP to distribute the Bond Act funding to school districts to achieve the state’s zero-emission goals and assist school districts in complying with the zero-emission school bus mandate.
−Removed: New York City Clean Trucks Voucher Program ("NYCCTVP")
−Removed: In support of the transition to all- electric vehicle s, in early February 2020, New York City Mayor Bill de Blasio signed an executive order requiring electrification of the city’s entire municipal vehicle fleet by 2040.
−Removed: In October 2020, we were named an approved dealership and our vehicles have been listed on the eligible vehicles list for the New York City Clean Trucks Program.
−Removed: This program provides funding for new electric truck purchases by New York City customers to replace and scrap older polluting ICE vehicles.
−Removed: The rebate incentive funding program provides New York City fleet owners $100,000 per vehicle for an all-electric Class 4 truck sold to them by Envirotech, and $125,000 per vehicle for a Class 5 all-electric truck.
−Removed: The amounts increase for Class 6-Class 8 trucks.
−Removed: New Jersey Zero Emissions Incentive Program ("NJZIP")
−Removed: The New Jersey Zero Emissions Incentive Program is a $90 million pilot voucher program that supports businesses and institutions purchasing new, zero-emission vehicles operating in New Jersey by offering up to $175,000 towards the purchase of battery-electric vehicles.
−Removed: In June 2021, we were named an approved vendor in the program.
−Removed: The program will fund vouchers ranging in value from $20,000 to $175,000 for businesses and institutional organizations looking to transition their fleets to zero emissions.
−Removed: Bonuses are available for small businesses and minority-, women-, and veteran-owned businesses.
−Removed: NJZIP is funded by proceeds allocated to the New Jersey Economic Development Authority by the Regional Greenhouse Gas Initiative (“RGGI”) for the purposes of reducing harmful emissions, especially in communities disproportionately impacted by transportation emissions, and creating economic opportunity within the state.
−Removed: Volkswagen Environmental Mitigation Trust Funds
−Removed: Beginning in 2018, all 50 states were eligible for millions in funds per year to on-road vehicle projects.
−Removed: Several states have provided carve outs specifically for electric vehicles and, in some cases, electric school buses.
−Removed: For example, California, Illinois, Indiana, Michigan and Ohio have each allocated funds directly to electric school bus projects.
−Removed: For instance, California’s Zero-Emission School Bus and Infrastructure project provides per vehicle incentives of up to $375,000.
−Removed: These states have been in the process of funding their initial rounds or are developing specific funding plans.
−Removed: We have engaged with several of these states to support the development of such plans, including funding the purchase of other commercial vehicles, provided that the buyer surrenders a qualifying existing fossil-fueled vehicle in order to qualify for the funding.
−Removed: California Air Resources Board ( “ CARB ” )
−Removed: CARB gathers air quality data for the State of California, ensures the quality of this data, designs and implements air models, and sets ambient air quality standards for the state, with a particular focus on regulating tailpipe emissions and other mobile sources.
−Removed: CARB compiles the state’s emissions inventory and performs air quality and emissions inventory special studies.
−Removed: CARB uses the Emissions Inventory and Air Quality Models to evaluate air quality and reduce emissions in each of California’s 35 local air districts.
−Removed: CARB also manages several incentive and rebate programs and awards hundreds of millions of dollars in grants to reduce emissions from on- and off-road vehicles and equipment.
−Removed: CARB is responsible for program oversight.
−Removed: CARB awards grants and funds through the Air Quality Improvement Program (AB 118), the Carl Moyer Program, the Voucher Incentive Program for enhanced fleet modernization and emission reduction, and the Lower- Emission School Bus Program/School Bus Retrofit and Replacement Account.
−Removed: On June 25, 2020, CARB passed the Advanced Clean Truck Regulation, requiring truck manufacturers to sell increasing percentages of zero-emission trucks starting with the 2024 model year.
−Removed: Numerous other states have adopted California’s standards established under this rule.
−Removed: More recently, on April 28, 2023, CARB issued the Advanced Clean Fleets Rule that would require owners of medium- and heavy-duty vehicle fleets to begin their transition toward zero-emission vehicles starting in 2024.
−Removed: However, in January 2025, CARB withdrew its request to the EPA for waiver of the Clean Air Act’s federal preemption provisions for the Advanced Clean Fleets Rule, and now the status of this rule remains uncertain.
−Removed: California Energy Commission (
−Removed: The California Energy Commission has several core responsibilities, including but not limited to setting energy policy, developing renewable energy, achieving energy efficiency, and transforming California’s transportation infrastructure.
−Removed: One goal of the CEC is to mitigate GHG emissions and reduce the impact of climate change.
−Removed: The CEC carries out its responsibilities pursuant to several of California’s landmark environmental laws.
−Removed: In 2006, the Legislature passed and then Governor Arnold Schwarzenegger signed two landmark pieces of legislation with far-reaching implications for energy policy.
−Removed: The most comprehensive is AB 32, the California Global Warming Solutions Act of 2006, which set an economy-wide cap on California GHG emissions at 1990 levels by no later than 2020.
−Removed: At the time, this was an aggressive goal that represented an approximately 11% reduction from then-current emissions levels and nearly a 30% reduction from projected business-as-usual levels in 2020.
−Removed: In 2015, California passed Senate Bill (SB) 350, which further committed California to reducing GHG emissions by establishing a 2030 greenhouse gas reduction target of 40% below 1990 levels and to achieve 100% clean energy by 2045.
−Removed: The transportation sector represents a significant portion of California’s GHG emissions.
−Removed: This bill was amended with respect to implementation, but the targeted goals remain the same as originally passed.
−Removed: In 2007, AB 118 created the Alternative and Renewable Fuel and Vehicle Technology Program.
−Removed: The program is intended to increase the use of alternative and renewable fuels and innovative technologies that will transform California’s fuel and vehicle types to help attain the state’s climate change policies.
−Removed: AB 118 authorizes the CEC to provide approximately $100 million annually as incentives to public agencies, vehicle and technology consortia, businesses, public-private partnerships, workforce training partnerships and collaboratives, fleet owners, consumers, recreational boaters, and academic institutions for projects that:
−Removed: develop and improve alternative and renewable low-carbon fuels;
−Removed: optimize alternative and renewable fuels for existing and developing engine technologies;
−Removed: improve light-, medium-, and heavy-duty vehicle technologies;
−Removed: and retrofit medium-and heavy-duty on-road and non-road vehicle fleets.
−Removed: Air Quality Management Districts ( “ AQMD ” ) and Air Pollution Control Districts ( “ APCD ” )
−Removed: California’s AQMDs/APCDs are responsible for controlling emissions primarily from stationary sources of air pollution such as large power plants and refineries.
−Removed: They also have a role in distributing funds and administering incentive programs from mobile sources-primarily cars, trucks and buses, construction equipment, ships and trains, from which approximately 75% of emissions are generated.
−Removed: The largest AQMD/ APCDs are the South Coast AQMD, Bay Area AQMD, San Joaquin Valley APCD, and the San Diego APCD.
−Removed: Local AQMDs/APCDs develop and adopt an Air Quality Improvement Plans, which serves as the blueprint to bring the respective areas into compliance with federal and state clean air standards.
−Removed: Rules are adopted to reduce emissions from various sources, including specific types of equipment, industrial processes, paints and solvents, even consumer products.
−Removed: Permits are issued to many businesses and industries to ensure compliance with air quality rules.
−Removed: Local AQMDs award grants to help reduce emissions in their local communities.
−Removed: These grants and incentive programs include programs aimed at reducing emissions from mobile sources such as buses and trucks.
−Removed: For example, the San Joaquin Valley Air District’s Truck Replacement Program is a program that is open year-round, and which offers grant funding equal to HVIP.
−Removed: In some cases, air district funding programs such as this can be combined with other sources including state and federal grants.
−Removed: Clean Cities is a program administered by the DOE’s Office of Efficiency and Renewable Energy, Vehicle Technology Program.
−Removed: According to the DOE, the mission of Clean Cities is to advance the energy, economic, and environmental security of the United States by supporting local decisions to adopt practices that reduce the use of petroleum in the transportation sector.
−Removed: Clean Cities is a government-industry partnership.
−Removed: Under the program, public and private stakeholders from businesses, city and state governments, the automotive industry, fuel providers, and community organizations form coalitions throughout the country, which then work with the DOE to establish a plan for reducing petroleum consumption in their respective geographic areas.
−Removed: Congestion Mitigation and Air Quality ( “ CMAQ ” ) Improvement Program
−Removed: The CMAQ Improvement Program, which is jointly administered by the Department of Transportation Federal Highway Administration and Federal Transit Administration, provides funding to states to support surface transportation projects and other related efforts that contribute air quality improvements and provide congestion relief.
−Removed: CMAQ funding is allocated to the states annually based on a statutory formula that is based on population and air quality classification as designated by the EPA.
−Removed: Each state’s transportation department then is responsible for distributing the funds.
−Removed: State transportation departments may spend CMAQ funds on projects that reduce ozone precursors, and at least 16 states have used CMAQ funds for alternative fuel vehicle projects (such as purchasing electric or hybrid vehicles).
−Removed: Funding for this program is authorized through the IIJA and may be subject to pause in funding implemented under Executive Order 14154.
−Removed: Commercial Clean Vehicle Credit
−Removed: Businesses and tax-exempt organizations that buy a qualified commercial clean vehicle may qualify for a clean vehicle tax credit of up to $40,000 under Internal Revenue Code (IRC) 45W.
−Removed: The maximum credit is $7,500 for qualified vehicles with GVWRs of under 14,000 pounds and $40,000 for all other vehicles.
−Removed: This tax credit may be subject to amendment or elimination in 2025 reconciliation bill.
−Removed: Zero Emissions Airport Vehicle ("ZEAV") and Infrastructure Incentives
−Removed: The Zero Emissions Airport Vehicle and Infrastructure Pilot Program provides funding to airports for up to 50% of the cost to acquire ZEAVs and install or modify supporting infrastructure for acquired vehicles.
−Removed: The program gives priority to applicants located in nonattainment areas, as defined by the Clean Air Act, and projects that achieve the greatest air quality benefits, as measured by the number of emissions reduced per dollar of funds spent under the program.
−Removed: Bus and Bus Facilities Grants
−Removed: Department of Transportation’s Federal Transit Administration (FTA) administers the Grants for Buses and Bus Facilities Competitive Program.
−Removed: Eligible applicants include state, local, and tribal governments, fixed-route bus operators, and private nonprofit organizations engaged in public transportation.
−Removed: Clean School Bus Program
−Removed: The EPA's Clean School Bus program provides funding to eligible applicants for the replacement of existing school buses with clean, alternative fuel school buses or zero-emission school buses.
−Removed: EPA may award up to 100% of the cost of the replacement bus, charging equipment, or fueling infrastructure.
−Removed: Eligible applicants are school districts, state and local government programs, federally recognized Native American tribes, non-profit organizations, and eligible contractors.
−Removed: Funding for this program is authorized through the IIJA and is likely subject to the Executive Order 14154’s funding pause directed at electric vehicles infrastructure or subsidy programs.
−Removed: Heavy-Duty Zero Emission Vehicle ("ZEV") and Infrastructure Grants
−Removed: During the Biden administration, EPA announced its plan to create a grant program for heavy-duty ZEVs and associated infrastructure by spring 2024.
−Removed: The IRA invested $1 billion to replace dirty heavy-duty vehicles with clean, zero-emission vehicles, support zero-emission vehicle infrastructure, and to train and develop workers.
−Removed: The EPA planned on distributing this $1 billion in funding for clean heavy-duty vehicles between 2024 and 2031.
−Removed: On March 12, 2025, the EPA announced that it would be reconsidering heavy-duty vehicle emissions regulations promulgated during the Biden administration.
−Removed: It is likely that these grants will be paused, eliminated, or amended to expand grant eligibility to include non-electric vehicles.
−Removed: Diesel Emissions Reduction Act ("DERA")
−Removed: The EPA established the DERA Program to reduce pollution emitted from diesel engines through the implementation of varied control strategies and the involvement of national, state, and local partners.
−Removed: DERA includes programs for existing diesel fleets, regulations for clean diesel engines and fuels, and regional collaborations and partnerships.
−Removed: Funding for the DERA program was created under the Energy Policy Act of 2005.
−Removed: The Trump administration has not indicated that this program will be amended or eliminated.
−Removed: Other State Incentives
−Removed: Most state provides a variety of electric vehicles incentives, as well as private enterprises incentives.
−Removed: The states with the most significant state-specific incentives include California, New Jersey, New York and Massachusetts.
−Removed: Government Regulation
−Removed: Our products are designed to comply with a significant number of governmental regulations and industry standards, some of which are evolving as new technologies are deployed.
−Removed: Government regulations regarding the manufacture, sale and implementation of products and systems similar to ours are subject to future change.
−Removed: We cannot predict what impact, if any, such changes may have upon our business.
−Removed: We believe that vehicles that utilize our technology are in conformity with all applicable laws in all relevant jurisdictions.
+Added: We seek to protect our intellectual property through a combination of confidentiality agreements, employee and contractor assignment agreements, trade secret protections, and selective use of intellectual property registrations where appropriate.
+Added: We also rely on contractual protections in our relationships with suppliers, manufacturing partners, and customers.
+Added: We maintain a trademark portfolio including common law trademarks and service marks and have three service marks registered and two trademark registrations in the United States with respect to our EV segment.
+Added: We do not currently hold any other patents, trademarks, franchises or concessions.
+Added: Following the delivery of the initial drone model by our U.S.
+Added: manufacturer, we will also own accompanying intellectual property rights in any work product resulting from the delivered drone, including, but not limited to, copyright and trademark rights.
+Added: Our success depends in part on our ability to protect our proprietary designs and processes and to avoid infringing on the intellectual property rights of others.
+Added: There can be no assurance that our intellectual property protections will be sufficient or that will not be subject to claims of infringement or misappropriation.
+Added: Government Regulations
+Added: We operate in markets that are subject to extensive regulation at the federal, state, local, and international levels.
+Added: These regulations affect product design, manufacturing, sales, deployment, and ongoing operations.
+Added: Compliance with applicable regulatory requirements is an integral part of our business, and regulatory changes may impact demand, costs, or the timing of commercial activities.
+Added: Commercial Electric Vehicles
+Added: Our commercial EV operations are subject to regulations governing motor vehicle safety, emissions, transportation, and environmental compliance.
+Added: In the United States, these include regulations administered by federal and state transportation and safety authorities, as well as state and local vehicle registration and operational requirements.
Emission and Fuel Economy Standards
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federal and state levels.
−Removed: The EPA and National Highway Traffic Safety Administration (“NHTSA”) issued a final rule for greenhouse gas emissions and fuel economy requirements for trucks and heavy-duty engines on August 9, 2011, which had an initial phase-in starting with model year 2014 and a final phase-in occurring in model year 2017.
+Added: The Environmental Protection Agency ("EPA") and National Highway Traffic Safety Administration (the “NHTSA”) issued a final rule for greenhouse gas emissions and fuel economy requirements for trucks and heavy-duty engines on August 9, 2011, which had an initial phase-in starting with model year 2014 and a final phase-in occurring in model year 2017.
NHTSA standards for model years 2014 and 2015 were voluntary, while mandatory standards first went into effect in 2016.
In August 2016, the EPA and NHTSA jointly finalized Phase 2 standards for medium- and heavy-duty vehicles through model year 2027 to improve fleet fuel efficiency and cut carbon emissions.
−Removed: The rule provides emission standards for carbon dioxide and fuel consumption standards for three main categories of vehicles:
−Removed: (i) combination tractors, (ii) heavy-duty pickup trucks and vans, and (iii) vocational vehicles.
−Removed: According to the EPA and NHTSA, vocational vehicles consist of a wide variety of truck and bus types, including delivery, refuse, utility, dump, cement, transit bus, shuttle bus, school bus, emergency vehicles, motor homes and tow trucks, and are characterized by a complex build process, with an incomplete chassis often built with an engine and transmission purchased from other manufacturers, then sold to a body manufacturer.
+Added: On March 29, 2024, the EPA announced a final rule, “Greenhouse Gas Emissions Standards for Heavy-Duty Vehicles – Phase 3,” that sets stronger standards to reduce greenhouse gas emissions from heavy-duty vehicles beginning in model year 2027.
+Added: The new standards will be applicable to heavy duty vocational vehicles, such as delivery trucks, refuse haulers, public utility trucks, transit, shuttle, school buses, etc., and tractors, such as day cabs and sleeper cabs on tractor-trailer trucks.
The EPA and NHTSA rule also establishes multiple flexibility and incentive programs for manufacturers of alternatively fueled vehicles, including an engine averaging banking and trading (“ABT”) program, a vehicle ABT program and additional credit programs for early adoption of standards or deployment of advanced or innovative technologies.
−Removed: The ABT programs allows for emission and/or fuel consumption credits to be averaged, banked or traded within defined groupings of the regulatory subcategories.
+Added: The ABT program allows for emission and/or fuel consumption credits to be averaged, banked or traded within defined groupings of the regulatory subcategories.
The additional credit programs allow manufacturers of engines and vehicles to be eligible to generate credits if they demonstrate improvements in excess of the standards established in the rule prior to the model year the standards become effective or if they introduce advanced or innovative technology engines or vehicles.
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The extent to which these regulations will be changed is unknown, but it is likely that restrictions on vehicle emission limits will be reduced or eliminated.
+Added: Demand for commercial EVs may be influenced by government incentive programs, grants, rebates, and procurement policies at the federal, state, and local levels.
+Added: Such programs are subject to modification, reduction, or elimination based on legislative, regulatory, or budgetary changes.
+Added: We do not control the availability or terms of these programs, and changes in incentive structures may affect customer purchasing decisions.
Vehicle Safety and Testing
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The requirements for shipments of these goods vary by mode of transportation, such as ocean vessel, rail, truck and air.
−Removed: Business Developments and Operational Updates
−Removed: As part of the Company’s ongoing growth strategy, several significant operational initiatives and partnerships were pursued and announced in recent periods.
−Removed: The following provides context and updates on these developments, including matters relating to property acquisition, production agreements, incentive programs, and financing discussions.
−Removed: Osceola Facility Development and Acquisition
−Removed: The Company has entered into a purchase agreement, through its wholly owned affiliate 1425 Ohlendorf Road LLC, for a manufacturing facility located in Osceola, Arkansas.
−Removed: While a contractual framework was established and the Company commenced investment in the facility under a lease agreement, the transaction has not yet closed, and legal title to the property has not yet transferred.
−Removed: Discussions with the City of Osceola are ongoing and have involved revisions to certain terms, including facility improvements, easement arrangements, and purchase conditions.
−Removed: The Company continues to work diligently toward finalizing the transaction and enhancing the facility to support future production capacity.
−Removed: Arkansas Incentive Program Engagement
−Removed: The Company engaged with the Arkansas Economic Development Commission (AEDC) regarding potential state-level incentive support for its Arkansas-based operations.
−Removed: AEDC provided a proposal outlining the potential for up to $27 million in incentives, subject to various approvals, documentation, and performance thresholds.
−Removed: While initial steps were taken to align with program requirements, the final agreement was not executed by AEDC, and the proposed incentive package remains subject to formalization.
−Removed: The Company remains in contact with relevant stakeholders and continues to explore avenues of support for its activities in the region.
−Removed: Production for International Fleet Operators
−Removed: The Company entered into a right-hand drive electric school bus development initiative for a Southeast Asia-based transportation provider, Yeap Transport Services.
−Removed: Development and homologation efforts were completed to meet applicable standards.
−Removed: However, due to unforeseen changes in leadership within the customer organization, the Company was notified in late 2024 that the program would not proceed.
−Removed: Discussions regarding potential redeployment of those units are ongoing as part of the Company’s broader international strategy.
−Removed: Customer Orders and Strategic Agreements
−Removed: From time to time, the Company announces the execution or anticipated execution of agreements with distributors, customers, or funding partners.
−Removed: In certain cases, these arrangements may be subject to further documentation, execution of final purchase orders, or third-party approvals.
−Removed: An anticipated vehicle purchase arrangement with DaVinci Innovations was discussed and included early-stage dealership activity, though no final binding purchase order has been received to date.
−Removed: Discussions with capital providers, including Karla Mae Capital, involved exploration of non-dilutive financing mechanisms.
−Removed: A related purchase order discounting facility for up to $10 million was subsequently finalized with GOBA Capital, reflecting the Company’s continued pursuit of flexible funding options to support growth.
−Removed: Sales Incentive Programs
−Removed: As part of its participation in the New Jersey Zero-Emission Incentive Program (NJ ZIP), the Company has delivered a cumulative total of 76 vehicles to qualified recipients since its initial involvement in 2021.
−Removed: These deliveries occurred over the course of the program and reflect the Company’s commitment to supporting clean vehicle deployment in key markets.
+Added: Drone Systems
+Added: Our drone systems initiatives are subject to aviation, safety, and operational regulations.
+Added: In the United States, commercial drone operations are regulated by the Federal Aviation Administration (the “FAA”), including requirements related to aircraft certification, operator licensing, airspace use, and operational limitations.
+Added: National Defense Authorization Act and American Security Drone Act
+Added: In December 2024, Congress passed the National Defense Authorization Act (“NDAA”), which includes the American Security Drones Act (“ASDA”).
+Added: The bill prohibits, starting in January 2026, federal agencies and federally funded programs from purchasing or using drones manufactured in countries that are viewed as threats to U.S.
+Added: national security, such as China.
+Added: The basis for the legislation is that purchases from these countries (i) pose a significant threat to national security, (ii) represent efforts to infiltrate and influence American society, and (iii) risk the theft of personal and business data.
+Added: Specifically, the American Security Drone Act:
+Added: (i) prohibits federal departments and agencies from procuring and operating certain foreign commercial off-the-shelf drone or covered unmanned aircraft system manufactured or assembled in countries identified as national security threats, and provides a timeline to end current use of these drones;
+Added: (ii) prohibits the use of federal funds awarded through certain contracts, grants, or cooperative agreements to state or local governments from being used (1) to procure a covered unmanned aircraft system that is manufactured or assembled by a covered foreign entity or (2) in connection with the operation of such a drone or unmanned aircraft system;
+Added: (iii) requires the Comptroller General of the United States to submit a report to Congress no later than 275 days after the enactment of the NDAA detailing the amount of foreign commercial off-the-shelf drones and covered unmanned aircraft systems procured by federal departments and agencies from countries identified as national security threats.
+Added: We believe that the NDAA will help to drive manufacturing of drone systems for government use to the U.S.
+Added: Federal Aviation Administration ("FAA")
+Added: The FAA is responsible for the regulation and oversight of civil aviation within the U.S.
+Added: Its primary mission is to ensure the safety of civil aviation.
+Added: In December 2015, the FAA announced that all drones weighing more than 250 grams, or 0.55 pounds, must be registered with the FAA.
+Added: In January 2021, the FAA finalized rules requiring that drones be identifiable remotely.
+Added: These rules are effective for drone manufacturers beginning in September 2023 and for drone pilots beginning in September 2024.
+Added: The FAA believes that remote ID technologies will enhance safety and security by allowing the FAA, law enforcement, and federal security agencies to identify drones flying in their jurisdiction.
+Added: These efforts lay the foundation for more complex operations, such as those beyond visual line of sight at low altitudes, as the FAA and the drone industry move toward a traffic management ecosystem for drone system flights separate from, but complimentary to, the air traffic management system.
+Added: In the United States, commercial drone operations are regulated primarily by the FAA under Part 107 of the Federal Aviation Regulations.
+Added: These regulations govern pilot certification, aircraft registration, operational limitations, and airspace access.
+Added: Current FAA regulations generally limit commercial drone operations to visual line-of-sight (VLOS) conditions, operations during daylight hours, and altitudes below 400 feet above ground level.
+Added: Operations beyond these limitations require waivers or special authorizations from the FAA.
+Added: The regulatory environment for beyond visual line-of-sight (BVLOS) operations is evolving, with the FAA implementing new frameworks to enable broader commercial drone deployment.
+Added: In June 2024, the FAA revised BVLOS criteria to facilitate commercial drone operations for delivery and inspection applications.
+Added: Our drone systems will require appropriate FAA certifications and authorizations for commercial operation.
+Added: The specific regulatory pathway will depend on the intended use case, operating environment, and level of autonomy.
+Added: We are designing our drone systems with regulatory compliance as a key consideration and intend to work closely with the FAA and other relevant agencies throughout the development process.
+Added: International Markets
+Added: In international markets, including the European Union, agricultural drone operations are permitted under applicable aviation and safety frameworks, subject to country-specific regulations, operator certification, and operational approvals.
+Added: Regulatory requirements may vary by jurisdiction and may impose limitations on payloads, flight operations, or use cases.
+Added: Government Procurement
+Added: In addition, procurement policies and regulatory frameworks emphasizing domestic sourcing, cybersecurity, and national security considerations may influence market access for drone systems, particularly for government and government-adjacent customers.
+Added: AI Data Infrastructure
+Added: The regulatory landscape surrounding AI, data center infrastructure and cloud computing is evolving rapidly, and we anticipate increased scrutiny and potential regulation in the near and long term as we develop our power-driven computing and data infrastructure initiatives.
+Added: In the realm of cloud computing, there are growing concerns about the ethical implications and potential misuse of these technologies, particularly in association with AI and machine learning.
+Added: Governments and regulatory bodies are considering measures to ensure the responsible development and deployment of AI systems, including transparency, accountability, and fairness guidelines.
+Added: In addition, our power-driven computing and data infrastructure initiatives are currently subject to laws and regulations governing energy production, power generation, environmental compliance, land use, zoning, construction, and data security.
+Added: Data center operations may also be subject to cybersecurity, privacy, and data protection requirements, depending on customer use cases and jurisdiction.
+Added: In particular, our evaluation of grid-connected and on-site power generation solutions for modular computing infrastructure is subject to extensive federal, state, and local regulatory frameworks.
+Added: If we deploy grid-connected systems, interconnection to the transmission or distribution grid is governed by applicable state public utility commissions and regional transmission organizations (“RTOs”), including queue processes that may involve technical studies, capacity allocation determinations, and cost-sharing obligations for system upgrades.
+Added: Interconnection timelines can extend multiple years depending on regional grid congestion and infrastructure constraints.
+Added: For projects incorporating on-site generation, including natural gas–fired generation, we would be subject to environmental permitting requirements under federal and state law.
+Added: These may include:
+Added: Air emissions permits under the Clean Air Act, administered by the U.S.
+Added: Environmental Protection Agency (“EPA”) or delegated state environmental agencies;
+Added: State-level air quality permits and operating permits;
+Added: Water discharge permits, if applicable;
+Added: Local land-use approvals and zoning compliance;
+Added: Building permits and fire safety approvals.
+Added: Projects utilizing natural gas infrastructure may also require compliance with federal and state pipeline safety regulations, including oversight by the Pipeline and Hazardous Materials Safety Administration, where applicable.
+Added: Additionally, depending on project structure, generation facilities could be subject to:
+Added: Federal Energy Regulatory Commission regulations related to wholesale power sales or grid interconnection;
+Added: State public utility commission oversight, particularly if electricity is sold to third parties;
+Added: Reliability standards established by the North American Electric Reliability Corporation for certain grid-connected facilities.
+Added: Certain jurisdictions also impose greenhouse gas reporting requirements, emissions offset programs, or renewable portfolio standards that may affect permitting, capital costs, or operating expenses.
+Added: We may also be subject to federal and state environmental review requirements, including assessments under the National Environmental Policy Act if federal lands, federal funding, or federal permits are involved.
+Added: Data center operations may also be subjected to cybersecurity, privacy and data protection requirements, depending on customer use cases and jurisdiction.
+Added: Delays in obtaining required permits or regulatory approvals could impact the timing, cost, or feasibility of certain deployments.
+Added: Regulatory requirements related to emissions, environmental impact, and safety may affect the design, cost, and timing of infrastructure deployment.
+Added: We continue to evaluate regulatory requirements applicable to grid-connected, off-grid, and hybrid power solutions.
+Added: Medical Supplies (Maddox Industries)
+Added: Through our wholly owned subsidiary Maddox Industries, we manufacture medical supplies for Maddox Medical in support of fulfillment of a government contract with certain federal government agencies.
+Added: Such government contracts and related programs are subject to extensive regulations governing procurement processes, pricing, quality standards, reporting obligations, and compliance requirements.
+Added: As a subcontractor, our participation in government programs may require compliance with laws and regulations related to domestic sourcing, labor standards, cybersecurity, and ethics.
+Added: Our medical supplies segment relies on Maddox Medical’s primary government contract, and such government contract may be subject to modification, termination, audit, or review.
+Added: There can be no assurance that Maddox Medical’s future program participation will be awarded or renewed.
+Added: Regulatory Compliance and Risk
+Added: We devote resources to monitoring regulatory developments and maintaining compliance with applicable laws and regulations.
+Added: However, regulatory requirements may change, and compliance may involve significant costs or operational constraints.
+Added: Failure to comply with applicable regulations could result in fines, penalties, delays, or restrictions on operations.
Company Information
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.