Blink Charging Co. 10-Q

ITEM 1. FINANCIAL STATEMENTS. BLINK CHARGING CO. Condensed Consolidated Balance Sheets (in thousands except for share amounts) March 31, December 31, 2023 2022 (unaudited) Assets Current Assets: Cash and cash equivalents $ 103,202 $ 36,562 Accounts receivable, net 27,883 23,581 Inventory, net 39,524 34,740 Prepaid expenses and other current assets 5,211 4,399 Total Current Assets 175,820 99,282 Restricted cash 78 71 Property and equipment, net 27,666 25,862 Operating lease right-of-use asset 5,095 4,174 Intangible assets, net 25,072 26,582 Goodwill 204,244 203,710 Other assets 3,025 2,861 Total Assets $ 441,000 $ 362,542 Liabilities and Stockholders’ Equity Current Liabilities: Accounts payable $ 28,621 $ 24,585 Accrued expenses and other current liabilities 12,808 13,109 Notes payable 10 10 Current portion of operating lease liabilities 2,037 1,738 Current portion of financing lease liabilities 301 306 Current portion of deferred revenue 11,496 10,572 Total Current Liabilities 55,273 50,320 Contingent consideration 1,323 1,316 Consideration payable 40,620 40,608 Operating lease liabilities, non-current portion 3,744 3,030 Financing lease liabilities, non-current portion 321 408 Other liabilities 649 645 Deferred revenue, non-current portion 5,406 5,258 Total Liabilities 107,336 101,585 Commitments and contingencies (Note 6) - - Stockholders’ Equity: Common stock, $ 0.001 par value, 500,000,000 shares authorized, 60,373,377 and 51,476,445 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively 60 51 Additional paid-in capital 701,331 597,982 Accumulated other comprehensive loss ( 3,896 ) ( 3,046 ) Accumulated deficit ( 363,831 ) ( 334,030 ) Total Stockholders’ Equity 333,664 260,957 Total Liabilities and Stockholders’ Equity $ 441,000 $ 362,542 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 1 BLINK CHARGING CO. Condensed Consolidated Statements of Operations (in thousands except for share and per share amounts) (unaudited) For The Three Months Ended March 31, 2023 2022 Revenues: Product sales $ 16,389 $ 8,052 Charging service revenue - company-owned charging stations 2,885 1,107 Network fees 1,628 161 Warranty 393 67 Grant and rebate 49 75 Ride-sharing services 252 239 Other 72 99 Total Revenues 21,668 9,800 Cost of Revenues: Cost of product sales 11,731 6,044 Cost of charging services - company-owned charging stations 887 523 Host provider fees 1,647 551 Network costs 437 234 Warranty and repairs and maintenance 948 111 Ride-sharing services 637 426 Depreciation and amortization 838 325 Total Cost of Revenues 17,125 8,214 Gross Profit 4,543 1,586 Operating Expenses: Compensation 22,709 9,259 General and administrative expenses 8,478 4,427 Other operating expenses 4,195 2,942 Total Operating Expenses 35,382 16,628 Loss From Operations ( 30,839 ) ( 15,042 ) Other Income (Expense): Interest expense ( 617 ) - Foreign transaction gain 1,807 3 Change in fair value of derivative and other accrued liabilities 10 - Other income (expense), net 50 ( 104 ) Total Other Income (Expense) 1,250 ( 101 ) Loss Before Income Taxes $ ( 29,589 ) $ ( 15,143 ) Provision for income taxes ( 212 ) - Net Loss $ ( 29,801 ) $ ( 15,143 ) Net Loss Per Share: Basic $ ( 0.53 ) $ ( 0.36 ) Diluted $ ( 0.53 ) $ ( 0.36 ) Weighted Average Number of Common Shares Outstanding: Basic 56,469,928 42,437,823 Diluted 56,469,928 42,437,823 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 BLINK CHARGING CO. Condensed Consolidated Statements of Comprehensive Loss (in thousands) (unaudited) For the Three Months Ended March 31, 2023 2022 Net Loss $ ( 29,801 ) $ ( 15,143 ) Other Comprehensive Income (Loss): Cumulative translation adjustments ( 850 ) ( 606 ) Total Comprehensive Loss $ ( 30,651 ) $ ( 15,749 ) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 3 BLINK CHARGING CO. Condensed Consolidated Statement of Changes in Stockholders’ Equity For the Three Months Ended March 31, 2023 (in thousands except for share amounts) (unaudited) Accumulated Additional Other Total Common Stock Paid-In Comprehensive Accumulated Stockholders’ Shares Amount Capital Loss Deficit Equity Balance - January 1, 2023 51,476,445 $ 51 $ 597,982 $ ( 3,046 ) $ ( 334,030 ) $ 260,957 Balance 51,476,445 $ 51 $ 597,982 $ ( 3,046 ) $ ( 334,030 ) $ 260,957 Common stock issued in public offering, net of issuance costs [1] 8,333,333 8 94,758 - - 94,766 Common stock issued in public offering, net of issuance costs 8,333,333 8 94,758 - - 94,766 Common stock issued upon exercises of warrants 557,733 1 834 - - 835 Stock-based compensation 5,866 - 7,757 - - 7,757 Other comprehensive loss - - - ( 850 ) - ( 850 ) Net loss - - - - ( 29,801 ) ( 29,801 ) Balance - March 31, 2023 60,373,377 $ 60 $ 701,331 $ ( 3,896 ) $ ( 363,831 ) $ 333,664 Balance 60,373,377 $ 60 $ 701,331 $ ( 3,896 ) $ ( 363,831 ) $ 333,664 [1] Includes gross proceeds of $ 100,000 , less issuance costs of $ 5,234 . The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 4 BLINK CHARGING CO. Condensed Consolidated Statement of Changes in Stockholders’ Equity For the Three Months Ended March 31, 2022 (in thousands except for share amounts) (unaudited) Accumulated Additional Other Total Common Stock Paid-In Comprehensive Accumulated Stockholders’ Shares Amount Capital Loss Deficit Equity Balance - January 1, 2022 42,423,514 $ 42 $ 458,046 $ ( 1,784 ) $ ( 242,470 ) $ 213,834 Balance 42,423,514 $ 42 $ 458,046 $ ( 1,784 ) $ ( 242,470 ) $ 213,834 Common stock issued upon exercises of warrants 16,811 - 69 - - 69 Stock-based compensation 144,497 1 1,932 - - 1,933 Other comprehensive loss - - - ( 606 ) - ( 606 ) Net loss - - - - ( 15,143 ) ( 15,143 ) Balance - March 31, 2022 42,584,822 $ 43 $ 460,047 $ ( 2,390 ) $ ( 257,613 ) $ 200,087 Balance 42,584,822 $ 43 $ 460,047 $ ( 2,390 ) $ ( 257,613 ) $ 200,087 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 BLINK CHARGING CO. Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) 2023 2022 For The Three Months Ended March 31, 2023 2022 Cash Flows From Operating Activities: Net loss $ ( 29,801 ) $ ( 15,143 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 3,166 758 Non-cash lease expense 438 55 Change in fair value of contingent consideration 8 - Loss on disposal of fixed assets ( 37 ) - Change in fair value of derivative and other accrued liabilities 10 - Provision for bad debt 555 502 Provision for slow moving and obsolete inventory ( 1,701 ) 295 Stock-based compensation: Common stock 3,685 507 Options 4,090 1,455 Changes in operating assets and liabilities: Accounts receivable and other receivables ( 4,377 ) ( 1,722 ) Inventory ( 3,202 ) ( 698 ) Prepaid expenses and other current assets ( 590 ) 297 Other assets ( 181 ) ( 288 ) Accounts payable and accrued expenses 3,876 2,120 Other liabilities 4 101 Lease liabilities ( 346 ) ( 66 ) Deferred revenue 226 444 Total Adjustments 5,624 3,760 Net Cash Used In Operating Activities ( 24,177 ) ( 11,383 ) Cash Flows From Investing Activities: Capitalization of engineering costs ( 550 ) - Purchases of property and equipment ( 1,665 ) ( 1,368 ) Net Cash Used In Investing Activities ( 2,215 ) ( 1,368 ) Cash Flows From Financing Activities: Proceeds from sale of common stock in public offering, net [1] 94,766 - Proceeds from exercise of options and warrants 835 69 Repayment of financing liability in connection with finance lease ( 92 ) - Payment of financing liability in connection with internal use software ( 149 ) ( 146 ) Net Cash Provided By (Used In) Financing Activities 95,360 ( 77 ) Effect of Exchange Rate Changes on Cash and Cash Equivalents ( 2,321 ) ( 158 ) Net Increase (Decrease) In Cash and Cash Equivalents and Restricted Cash 66,647 ( 12,986 ) Cash and Cash Equivalents and Restricted Cash - Beginning of Period 36,633 175,049 Cash and Cash Equivalents and Restricted Cash - End of Period $ 103,280 $ 162,063 Cash and cash equivalents and restricted cash consisted of the following: Cash and cash equivalents $ 103,202 $ 161,984 Restricted cash 78 79 Total Cash and cash equivalents and restricted cash $ 103,280 $ 162,063 [1] Includes gross proceeds of $ 100,000 , less issuance costs of $ 5,654 deducted directly from the offering proceeds . The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 6 BLINK CHARGING CO. Condensed Consolidated Statements of Cash Flows — Continued (in thousands) (unaudited) 2023 2022 For The Three Months Ended March 31, 2023 2022 Supplemental Disclosures of Cash Flow Information: Cash paid during the period for: Interest $ - $ - Income taxes $ - $ 10 Non-cash investing and financing activities: Right-of-use assets obtained in exchange for lease obligations $ 1,209 $ - Intangible assets obtained in exchange for financing liability $ - $ 660 Transfer of inventory to property and equipment $ ( 427 ) $ ( 698 ) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 7 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 1. BUSINESS ORGANIZATION, NATURE OF OPERATIONS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES Organization and Operations Blink Charging Co., through its wholly-owned subsidiaries (collectively, the “Company” or “Blink”), is a leading owner, operator, and provider of electric vehicle (“EV”) charging equipment and networked EV charging services. Blink offers residential and commercial EV charging equipment, enabling EV drivers to recharge at various location types. Blink’s principal line of products and services is its Blink EV charging networks (the “Blink Networks”) and Blink EV charging equipment, also known as electric vehicle supply equipment (“EVSE”) and other EV-related services. The Blink Networks provide property owners, managers, parking companies, and state and municipal entities (“Property Partners”) with cloud-based services that enable the remote monitoring and management of EV charging stations. The Blink Networks also provide EV drivers with vital station information, including station location, availability and fees. Blink also operates a ride-sharing program through the Company’s wholly owned subsidiary, BlueLA Rideshare, LLC and the City of Los Angeles which allows customers the ability to rent electric vehicles through a subscription service. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the condensed consolidated financial statements of the Company as of March 31, 2023 and for the three months then ended. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the operating results for the full year ending December 31, 2023 or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related disclosures of the Company as of December 31, 2022 and for the year then ended, which were filed with the Securities and Exchange Commission (“SEC”) on March 14, 2023 as part of the Company’s Annual Report on Form 10-K. Risks and Uncertainties The Covid-19 pandemic has impacted global stock markets and economies. The Company closely monitors the impact of the outbreak on all aspects of our business. The extent to which its operations may be impacted by the Covid-19 pandemic will depend largely in future developments, which are highly uncertain and cannot be accurately predicted. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Since the Annual Report for the year ended December 31, 2022, there have been no material changes to the Company’s significant accounting policies, except as disclosed in this note. FOREIGN CURRENCY TRANSLATION The Company’s reporting currency is the United States dollar. The functional currency of certain subsidiaries is the Euro, Indian Rupee, and the Pound Sterling. Assets and liabilities are translated based on the exchange rates at the balance sheet date ( 1.0884 for the Euro, .0122 for the Indian Rupee, and 1.2368 for the Pound Sterling as of March 31, 2023), while expense accounts are translated at the weighted average exchange rate for the period ( 1.0741 for the Euro, .0122 for the Indian Rupee, and 1.2206 for the Pound Sterling for the three months ended March 31, 2023). Equity accounts are translated at historical exchange rates. The resulting translation adjustments are recognized in stockholders’ equity as a component of accumulated other comprehensive income. Comprehensive income (loss) is defined as the change in equity of an entity from all sources other than investments by owners or distributions to owners and includes foreign currency translation adjustments as described above. Transaction gains and losses are charged to the condensed consolidated statement of operations as incurred. Transaction gains attributable to foreign exchange were $ 1,807 and $ 3 during the three months ended March 31, 2023 and 2022, respectively. REVENUE RECOGNITION The Company recognizes revenue primarily from four different types of contracts: ● Product sales – Revenue is recognized at the point where the customer obtains control of the goods and the Company satisfies its performance obligation, which generally is at the time it ships the product to the customer. ● Charging service revenue – company-owned charging stations - Revenue is recognized at the point when a particular charging session is completed. ● Network fees and other – Represents a stand-ready obligation whereby the Company is obligated to perform over a period of time and, as a result, revenue is recognized on a straight-line basis over the contract term. Network fees are billed annually. ● Other – Other revenues is primarily comprised of revenues generated from alternative fuel credits. 8 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED REVENUE RECOGNITION - CONTINUED The following table summarizes revenue recognized in the condensed consolidated statements of operations: SCHEDULE OF REVENUE RECOGNITION BY CONTRACT 2023 2022 For The Three Months Ended March 31, 2023 2022 Revenues - Recognized at a Point in Time Product sales $ 16,389 $ 8,052 Charging service revenue - company-owned charging stations 2,885 1,107 Other 72 99 Total Revenues - Recognized at a Point in Time 19,346 9,258 Revenues - Recognized Over a Period of Time: Network and other warranty fees 2,021 228 Total Revenues - Recognized Over a Period of Time 2,021 228 Revenues- Other Ride-sharing services 252 239 Grant and rebate 49 75 Total Revenues - Other 301 314 Total Revenue $ 21,668 $ 9,800 The following table summarizes our revenue recognized in the condensed consolidated statements of operations by geographical area: SCHEDULE OF REVENUE RECOGNITION BY GEOGRAPHICAL AREA 2023 2022 For The Three Months Ended March 31, 2023 2022 Revenues by Geographical Area U.S.A $ 13,175 $ 5,856 International 8,493 3,944 Total Revenue $ 21,668 $ 9,800 The timing of the Company’s revenue recognition may differ from the timing of payment by its customers. A receivable is recorded when revenue is recognized prior to payment and the Company has an unconditional right to payment. Alternatively, when payment precedes the provision of the related goods or services, the Company records deferred revenue until the performance obligations are satisfied. As of March 31, 2023, the Company had $ 16,902 related to contract liabilities where performance obligations have not yet been satisfied, which has been included within deferred revenue on the condensed consolidated balance sheet as of March 31, 2023. The Company expects to satisfy $ 11,496 of its remaining performance obligations for network fees, charging services, warranty revenue, product sales, and other and recognize the revenue within the next twelve months. During the three months ended March 31, 2023, the Company recognized $ 435 of revenues related to network fees and warranty contracts, which were included in deferred revenues as of December 31, 2022. During the three months ended March 31, 2023, there was no revenue recognized from performance obligations satisfied (or partially satisfied) in previous periods. Grants, rebates and alternative fuel credits, which are not within the scope of ASC 606, pertaining to revenues and periodic expenses are recognized as income when the related revenue and/or periodic expense are recorded. Grants and rebates related to EV charging stations and their installation are deferred and amortized in a manner consistent with the related depreciation expense of the related asset over their useful lives over the useful life of the charging station. During the three months ended March 31, 2023 and 2022, the Company recorded $ 49 and $ 75 , respectively, related to grant and rebate revenue. During the three months ended March 31, 2023 and 2022, the Company recognized $ 51 and $ 67 of revenue related to alternative fuel credits. Furthermore, ride-sharing services, which are not within scope of ASC 606, pertain to revenues and expenses related to a ride-sharing services agreement with the City of Los Angeles which allows customers the ability to rent electric vehicles through a subscription service. The Company recognizes revenue over the contractual period of performance of the subscription which are short term in nature. During the three months ended March 31, 2023 and 2022, the Company recognized $ 252 and $ 239 , respectively, related to ride-sharing services revenue. 9 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – CONTINUED CONCENTRATIONS During the three months ended March 31, 2023 and 2022, sales to a significant customer represented 13 % of total revenue. During the three months ended March 31, 2022, sales to another significant customer represented 12 % of total revenue. During the three months ended March 31, 2023 and 2022, the Company made purchases from a significant supplier that represented 16 % and 14 % of total purchases, respectively. NET LOSS PER COMMON SHARE Basic net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding, plus the number of additional common shares that would have been outstanding if the common share equivalents had been issued (computed using the treasury stock or if converted method), if dilutive. The following common share equivalents are excluded from the calculation of weighted average common shares outstanding because their inclusion would have been anti-dilutive: SCHEDULE OF OUTSTANDING DILUTED SHARES EXCLUDED FROM DILUTED LOSS PER SHARE COMPUTATION 2023 2022 For the Three Months Ended March 31, 2023 2022 Warrants 1,169,031 3,257,989 Options 1,084,580 977,473 Total potentially dilutive shares 2,253,611 4,235,462 3. STOCKHOLDERS’ EQUITY PUBLIC OFFERING In February 2023, the Company completed an underwritten registered public offering of 8,333,333 shares of its common stock at a public offering price of $ 12.00 per share. The Company received approximately $ 100,000 in gross proceeds from the public offering and $ 94,766 in net proceeds after deducting the underwriting discount and offering expenses paid by the Company. In addition, the underwriters had a 30-day option to purchase up to an additional 1,249,999 shares of common stock from the Company at the public offering price, less the underwriting discounts and commissions. The public offering was made pursuant to our automatic shelf registration statement on Form S-3ASR filed with the SEC on January 6, 2021, and prospectus supplement dated February 8, 2023. Barclays acted as the sole book-running manager for the offering. H.C. Wainwright & Co., Roth Capital Partners and ThinkEquity acted as co-managers for the offering. The underwriters did not exercise their over-allotment option. COMMON STOCK During the three months ended March 31, 2023, the Company issued an aggregate of 557,733 shares of common stock pursuant to exercises of warrants to purchase an aggregate of 557,733 shares of common stock for aggregate net proceeds of $ 835 . During the three months ended March 31, 2023, the Company issued an aggregate of 5,866 shares of common stock for services to a board member with an issuance date fair value of $ 132 . STOCK-BASED COMPENSATION The Company recognized stock-based compensation expense related to common stock, stock options and warrants for the three months ended March 31, 2023 and 2022 of $ 7,775 and $ 1,962 , respectively, which is included within compensation expense on the condensed consolidated statements of operations. As of March 31, 2023, there was $ 7,632 of unrecognized stock-based compensation expense that will be recognized over the weighted average remaining vesting period of 1.29 years. 10 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 4. RELATED PARTY TRANSACTIONS See Note 6 – Commitments and Contingencies – Purchase Commitments for disclosure of a commitment made to a related party. JOINT VENTURE The Company and a group of three Cyprus entities entered into a shareholders’ agreement on February 11, 2019, pertaining to the parties’ respective shareholdings in a new joint venture entity, Blink Charging Europe Ltd. (the “Entity”), that was formed under the laws of Cyprus on the same date. Subsequently, two of the Cyprus entities sold its interest to the remaining Cyprus entity. Pursuant to the agreement, the Company is not required to fund operating losses. The Company owns 40 % of the Entity while the other entity owns 60 % of the Entity. The Entity currently owns 100 % of a Greek subsidiary, Blink Charging Hellas SA (“Hellas”), which started operations in the Greek EV market. There are currently no plans for the Company to make any additional capital contributions or investments. During the three months ended March 31, 2023 and 2022, the Company recognized sales of $ 0 and $ 68 , respectively, to Hellas. As of March 31, 2023 and December 31, 2022 the Company had a payable of approximately $ 53 and $ 84 , respectively, to Hellas. The Company determined that the Entity is a variable interest entity; however, the Company does not have a controlling financial interest and, as a result, the Company is not required to consolidate the Entity and instead has applied equity method accounting to its investment in the Entity. From inception through March 31, 2023, the Entity has not generated net income and, as a result, pursuant to ASC 323, the Company has not recorded a gain or loss on its equity method investment in the Entity during the three months ended March 31, 2023 and 2022. BLINK CHARGING UK LIMITED As of March 31, 2023, several close family members of a senior management employee are providing services to Blink Charging UK Limited (“Blink UK”), formerly known as Electric Blue Limited. For the three months ended March 31, 2023, these related parties have collectively provided services worth $ 86 to Blink UK. Furthermore, as of March 31, 2023, there were purchase commitments of $ 142 to the same related parties. 5. LEASES OPERATING LEASES Total operating lease expenses for the three months ended March 31, 2023 and 2022 were $ 493 and $ 168 , respectively, and were recorded in other operating expenses on the condensed consolidated statements of operations. Operating lease expenses consist of rent expense, common area maintenance adjustments and other expenses. As of March 31, 2023, the Company had $ 652 of right-of-use assets that were classified as financing leases for vehicles associated with the operations of Blink Mobility which are included as a component of property and equipment on the condensed consolidated balance sheet as of March 31, 2023. The duration of the leases are three years and the Company is expected to pay approximately $ 1,020 throughout the term. As of March 31, 2023, the Company did not have additional operating and financing leases that have not yet commenced. During the three months ended March 31, 2023, the Company recorded $ 10 of interest expense related to finance leases, which were recorded within interest expense on the condensed consolidated statement of operations. During the three months ended March 31, 2023, the Company recorded amortization expense of $ 169 related to finance leases. There were no expenses incurred related to finance leases during the three months ended March 31, 2022. 11 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 5. LEASES – CONTINUED Supplemental cash flows information related to leases was as follows: SCHEDULE OF SUPPLEMENTAL CASH FLOWS INFORMATION RELATED TO LEASES 2023 2022 For The Three Months Ended March 31, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 346 $ 66 Financing cash flows from finance leases $ 92 $ - Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,209 $ - Weighted Average Remaining Lease Term Operating leases 3.45 4.65 Finance leases 2.00 - Weighted Average Discount Rate Operating leases 5.5 % 4.7 % Finance leases 6.2 % 0.0 % Future minimum payments under non-cancellable leases as of March 31, 2023 were as follows: SCHEDULE OF FUTURE MINIMUM LEASE PAYMENTS For the Years Ending December 31, Operating Lease Finance Lease 2023 $ 2,271 $ 340 2024 1,827 340 2025 1,297 - 2026 716 - 2027 464 - Total future minimum lease payments 6,575 680 Less: imputed interest ( 794 ) ( 58 ) Total $ 5,781 $ 622 6. COMMITMENTS AND CONTINGENCIES PURCHASE COMMITMENTS As of March 31, 2023, the Company had purchase commitments of approximately $ 62,088 of which, approximately $ 142 is with a related party, which will become payable upon the suppliers’ delivery of the charging stations and other related items. The purchase commitments were made primarily for future sales, deployments of charging stations, inventory management planning and other related items, all of which are expected to be received during the next 12-24 months. LITIGATION AND DISPUTES On August 24, 2020, a purported securities class action lawsuit, captioned Bush v. Blink Charging Co. et al., Case No. 20-cv-23527, was filed in the United States District Court for the Southern District of Florida against the Company, Michael Farkas (Blink’s Chairman of the Board and Chief Executive Officer), and Michael Rama (Blink’s Chief Financial Officer) (the “Bush Lawsuit”). On September 1, 2020, another purported securities class action lawsuit, captioned Vittoria v. Blink Charging Co. et al., Case No. 20-cv-23643, was filed in the United States District Court for the Southern District of Florida against the same defendants and seeking to recover the same alleged damages (the “Vittoria Lawsuit”). On October 1, 2020, the court consolidated the Vittoria Lawsuit with the Bush Lawsuit and on December 21, 2020 the court appointed Tianyou Wu, Alexander Yu and H. Marc Joseph to serve as the Co-Lead Plaintiffs. The Co-Lead Plaintiffs filed an Amended Complaint on February 19, 2021. The Amended Complaint alleges, among other things, that the defendants made false or misleading statements about the size and functionality of the Blink Network and asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The Amended Complaint does not quantify damages but seeks to recover damages on behalf of investors who purchased or otherwise acquired Blink’s common stock between March 6, 2020 and August 19, 2020. On April 20, 2021, Blink and the other defendants filed a motion to dismiss the Amended Complaint, which has now been fully briefed and is ready for review. On April 7, 2022, the court held oral argument on the motion to dismiss but did not issue a decision. The Company wholly and completely disputes the allegations therein. The Company has retained legal counsel in order to defend the action vigorously. The Company has not recorded an accrual related to this matter as of March 31, 2023 as it determined that any such loss contingency was either not probable or estimable. 12 BLINK CHARGING CO. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (in thousands except for share and per share amounts) 6. COMMITMENTS AND CONTINGENCIES – CONTINUED LITIGATION AND DISPUTES – CONTINUED On September 15, 2020, a shareholder derivative lawsuit, captioned Klein (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. 20- 19815CA01, was filed in Miami-Dade County Circuit Court seeking to pursue claims belonging to the Company against Blink’s Board of Directors and Michael Rama (the “Klein Lawsuit”). Blink is named as a nominal defendant. The Klein Lawsuit asserts that the Director defendants caused Blink to make the statements that are at issue in the securities class action and, as a result, the Company will incur costs defending against the consolidated Bush Lawsuit and other unidentified investigations. The Klein Lawsuit asserts claims against the Director defendants for breach of fiduciary duties and corporate waste and against all of the defendants for unjust enrichment. Klein did not quantify the alleged damages in his complaint, but he seeks damages sustained by the Company as a result of the defendants’ breaches of fiduciary duties, corporate governance changes, restitution, and disgorgement of profits from the defendants and attorneys’ fees and other litigation expenses. The parties agreed to temporarily stay the Klein Lawsuit until there is a ruling on the motion to dismiss filed in the consolidated Bush Lawsuit. On June 17, 2022, the court substituted the executrix of Klein’s estate as the plaintiff. The Company has not recorded an accrual related to this matter as of March 31, 2023 as it determined that any such loss contingency was either not probable or estimable. On December 23, 2020, another shareholder derivative action, captioned Bhatia (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. 20-27632CA01, was filed in Miami-Dade County Circuit Court against the same defendants sued in the Klein Lawsuit and asserting similar claims, as well as additional claims relating to the Company’s nomination, appointment and hiring of minorities and women and the Company’s decision to retain its outside auditor (the “Bhatia Lawsuit”). On February 17, 2021, the parties agreed to consolidate the Klein and Bhatia actions, which the court consolidated under the caption In re Blink Charging Company Stockholder Derivative Litigation, Lead Case No. 2020-019815-CA-01. The parties also agreed to keep in place the temporary stay. The court subsequently vacated the consolidation order and explained the parties should first file a motion to transfer, which the parties have done. On June 22, 2022, the court re-consolidated the Klein and Bhatia actions and reinstated the temporary stay. The Company wholly and completely disputes the allegations therein. The Company has retained legal counsel in order to defend the action vigorously. The Company has not recorded an accrual related to this matter as of March 31, 2023 as it determined that any such loss contingency was either not probable or estimable. On February 7, 2022, another shareholder derivative lawsuit, captioned McCauley (derivatively on behalf of Blink Charging Co.) v. Farkas et al., Case No. A-22-847894-C, was filed in the Eighth Judicial District Court in Clark County, Nevada, seeking to pursue claims belonging to the Company against six of Blink’s directors and Michael Rama (the “McCauley Lawsuit”). Blink is named as a nominal defendant. The complaint filed in the McCauley Lawsuit asserts similar allegations to the Klein Lawsuit relating to the statements at issue in the securities class action and asserts claims for breach of fiduciary duty and unjust enrichment. The McCauley Lawsuit seeks both injunctive and monetary relief from the individual defendants, as well as an award of attorneys’ fees and costs. On March 29, 2022, the Nevada court approved the parties’ stipulation to temporarily stay the McCauley Lawsuit until there is a ruling on the motion to dismiss filed in the consolidated Bush Lawsuit. The Company has not recorded an accrual related to this matter as of March 31, 2023 as it determined that any such loss contingency was either not probable or estimable. WARRANTY The Company estimates an approximate cost of $ 275 to repair deployed chargers, which the Company owns as of March 31, 2023. 7. SUBSEQUENT EVENTS ACQUISITION On April 18, 2023, the Company, Blink Mobility, LLC, a California limited liability company and wholly-owned subsidiary of the Company (“Mobility”), and Mobility Merger Sub Inc., a Delaware corporation and wholly-owned subsidiary of Mobility (“Merger Sub”), entered into and, after all parties met the closing conditions, consummated the transactions contemplated under an Agreement and Plan of Merger, dated as of April 18, 2023 (the “Acquisition Agreement”), with Envoy Technologies, Inc., a Delaware corporation (“Envoy”). Pursuant to the Acquisition Agreement, Merger Sub merged with and into Envoy, whereupon the separate corporate existence of Merger Sub ceased, and Envoy was the surviving corporation of the merger and a wholly-owned subsidiary of Mobility (the “Acquisition”). Envoy is a car sharing platform with an iOS/Android app that provides on-demand electric vehicles as an amenity to apartments, office buildings and hotels. The company equips real estate owners and operators with a new and innovative way to enhance the lifestyle of their tenants, members and guests by providing “Mobility as an Amenity™ service,” a platform that offers a technology to reserve and access vehicles, driver insurance, maintenance, electric vehicle chargers, electric fleet, fleet maintenance, full-service mobile app, customer support and robust analytics. Envoy provides the technology, operations and vehicles to implement private and dedicated auto-sharing as an amenity for any community. Under the terms of the Acquisition Agreement, the acquisition consideration was up to $ 35,500 , paid as follows: (i) $6,000 in cash paid upon the closing of the Acquisition Agreement (the “Closing”); (ii) a promissory note of Mobility in the principal amount of $5,000; (iii) a promissory note of Mobility in the principal amount of $2,000; and (iv)(a) in the event of an initial public offering or direct listing of Mobility or Mobility’s successor within 24 months after the Closing (and shares of common stock of the Company are not issued in lieu thereof), $18,500, $21,000 or $22,500 worth of shares of common stock of Mobility or Mobility’s successor, depending on the timing of such offering or listing, (b) in the event there is no initial public offering or direct listing of Mobility or Mobility’s successor within 24 months after the Closing, $21,000 worth of shares of common stock of the Company, or (c) at the Company’s option, a combination of cash and common stock of the Company with an aggregate value of $21,000. The payment of shares of common stock of Mobility or Mobility’s successor, if any, will be based on the public offering price per share of such stock in the initial public offering. The payment of shares of common stock of the Company, if any, will be based on the average of the daily-weighted average prices for such stock on each of the 60 days ending on the day prior to issuance thereof. Additionally, certain key employees of Envoy entered into employment offer letters with Mobility, including Aric Ohana, the Chief Executive Officer of the Company’s Envoy subsidiary. 13