What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2024-03-27 compared with 2023-03-30 · 487 added, 377 removed, 698 unchanged (55% of the section changed)

9 unchanged sentences

Notes to the Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

To The Board of Directors and the Stockholders of

Twin Vee Powercats Co.

REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and the Stockholders of

Vee Powercats Co.

and Subsidiaries

Fort Pierce, Florida

Opinion on the Financial Statement

We have audited the accompanying consolidated financial

statements of Twin Vee PowerCats Co.

and Subsidiaries (the “Company”), which comprise the consolidated balance sheets at December

31, 2022 and 2021, and the related consolidated statements of operations, stockholders’ equity and cash flows for the years then

ended, and the related notes to the consolidated financial statements (collectively referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company

at December 31, 2022 and 2021 and the results of its operations and its cash flows for the years then ended, in conformity with accounting

principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility

of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements

based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB)

and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable

rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we

engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Pierce, Florida

on the Financial Statement

have audited the accompanying consolidated financial statements of Twin Vee Powercats Co.

and Subsidiaries (the “Company”),

which comprise the consolidated balance sheets at December 31, 2023 and 2022, and the related consolidated statements of operations,

stockholders’ equity and cash flows for the years then ended, and the related notes to the consolidated financial statements (collectively

referred to as the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material

respects, the financial position of the Company at December 31, 2023 and 2022 and the results of its operations and its cash flows for

the years then ended, in conformity with accounting principles generally accepted in the United States of America.

consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion

on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public

Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance

with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing

an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess

the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the

financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management,

as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide a reasonable

basis for our opinion.

/s/ GRASSI & CO., CPAs, P.C.

We have served as the Company’s auditor since 2020.

Jericho, New York

March 29, 2023

audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether

due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence

regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used

and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

& CO., CPAs, P.C.

have served as the Company’s auditor since 2020.

TWIN VEE POWERCATS CO.

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Cash and cash equivalents

Restricted cash

Accounts receivable

Marketable securities

Deferred offering costs

Due from affiliated companies

Inventories, net

Prepaid expenses and other current assets

9 unchanged sentences

Contract liabilities

Due to affiliated companies

Finance lease liability

Operating lease right of use liability

1 unchanged sentence

Economic Injury Disaster Loan

Finance lease liability - noncurrent

Operating lease liability - noncurrent

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$ 0.001 par value;

9,520,000 and 7,000,000 shares issued and outstanding, respectively

9,520,000 shares issued and outstanding

Additional paid-in capital

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TWIN VEE POWERCATS CO.

AND SUSIDIARIES

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

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Depreciation and amortization

Research and design

Research and development

Total operating expenses

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Other income (expense):

Dividend income

Interest expense

1 unchanged sentence

Loss on disposal of assets

Gain from insurance recovery

Net change in fair value of marketable securities

Government grant income

Unrealized gain on marketable securities

Realized gain on marketable securities

Employee Retention Credit income

Total other income

Loss before income tax

Income before income tax

( 9,782,196 )

( 5,793,414 )

Provision for income taxes

Income taxes provision

( 9,782,196 )

1 unchanged sentence

Net loss attributable to noncontrolling interests

( 2,590,020 )

Net loss attributed to stockholders of Twin Vee PowerCats Co, Inc.

8 unchanged sentences

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

Preferred Stock

Noncontrolling

1 unchanged sentence

$ ( 2,017,556 )

Common stock issued for payment on behalf of parent

Common stock issued for cash

Subsidiary share issuance

Stock-based compensation

Merger of Twin Vee PowerCats, Inc.

( 5,137,252 )

2 unchanged sentences

$ ( 7,154,808 )

Common stock issued for payment on behalf of Twin Vee PowerCats, Inc.

Common stock issued for cash

Subsidiary share issuance

Stock-based compensation

Merger of Twin Vee PowerCats, Inc.

Subsidiary stock repurchase

( 7,192,176 )

( 2,590,020 )

( 9,782,196 )

Balance, December 31, 2023

6 unchanged sentences

Cash Flows From Operating Activities

$ ( 9,782,196 )

$ ( 5,793,414 )

Adjustments to reconcile net loss to net cash used in operating activities:

Stock based compensation

Impairment loss

Depreciation and amortization

Loss on disposal of asset

Gain on government grant

Change of right-of-use asset

Net change in fair value of marketable securities

Change in inventory reserve

Changes in operating assets and liabilities:

Accounts receivable

( 1,296,045 )

( 2,208,563 )

Prepaid expenses and other current assets

4 unchanged sentences

Net cash used in operating activities

( 6,934,773 )

( 4,146,031 )

Cash Flows From Investing Activities

Security deposit

Net sales (purchases) of investment in trading marketable securities

Realized gain on sale of marketable securities, available for sale

Net (purchases) sales of investment in trading marketable securities

( 1,343,702 )

Proceeds from sale of property and equipment

Purchase of property and equipment

( 5,162,478 )

( 3,365,679 )

Net cash used in investing activities

( 6,629,021 )

Cash Flows From Financing Activities

Net proceeds from Twin Vee issuance of common stock

Net proceeds from Forza issuance of common stock

Proceeds from Paycheck Protection Program loan

Proceeds from issuance of common stock

Proceeds from Forza Issuance of common stock

Deferred offering costs

Forza stock repurchase

Advances from related parties

Repayment to related parties

Finance lease payments

Net cash provided by financing activities

Net change in cash and cash equivalents

Cash at beginning of year

Cash and cash equivalents at end of year

Net change in cash, cash equivalents and restricted cash

( 6,745,774 )

Cash and cash equivalents at beginning of the year

Cash, cash equivalents and restricted cash at end of the year

Supplemental Cash Flow Information

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Non Cash Investing and Financing Activities

Increase in the right-of-use asset

Common stock issued for payment on behalf of Twin Vee Inc.

The accompanying notes are an integral part of these

consolidated financial statements

Increase in the right-of-use asset and lease liability

Common stock issued for payment on behalf of parent

Right of use asset - finance leases

Reconciliation to the Consolidated Balance Sheets

Cash and cash equivalents

Restricted cash

Total cash, cash equivalents and restricted cash

TWIN VEE POWERCATS CO.

5 unchanged sentences

Twin Vee PowerCats Co.

(“Twin Vee”) was

incorporated as Twin Vee Catamarans, Inc., in the state of Florida, on December 1, 2009.

On April 7, 2021, the Company filed a Certificate

of Conversion to register and incorporate in the state of Delaware and changed the company name to Twin Vee PowerCats Co.

The Certificate

of Incorporation for Twin Vee PowerCats Co.

(“Twin Vee” or

the “Company”) was incorporated as Twin Vee Catamarans, Inc., in the state of Florida, on December 1, 2009.

On April 7, 2021,

the Company filed a Certificate of Conversion to register and incorporate in the state of Delaware and changed the company name to Twin

Vee PowerCats Co.

The Certificate of Incorporation for Twin Vee PowerCats Co.

was also filed on April 7, 2021.

2 unchanged sentences

Fix My Boat will utilize a franchise model for marine mechanics across the

Fix My Boat has been inactive for the majority of 2022, we anticipate focusing resources on this entity in 2023.

On October 15, 2021, the Company incorporated Electra

Power Sports, Inc., and subsequently changed the name to Forza X1, Inc.

(“Forza X1” “Forza) October 29, 2021.

aims to be among the first to develop and manufacture electric boats targeting the recreational market.

We are focused on the

creation and implementation of marine electric vehicle (“EV”) technology to control and power our electric boats utilizing

our proprietary outboard electric motor.

Our electric boats are being designed as fully integrated electric boats including the hull,

outboard motor and control system.

On December 5, 2022, pursuant to the terms of the Agreement and Plan of Merger,

dated as of September 8, 2022 (the “Merger Agreement”), by and between Twin Vee PowerCats Co.

and Twin Vee Powercats, Inc.,

a Florida corporation (“TVPC”), was merged with and into the Company (the “Merger”).

As TVPC did not meet the definition of a business under ASC 805, the merger

was not accounted for as a business combination.

The merger was accounted for as a recapitalization of Twin Vee PowerCats, Co., effected

through the exchange of TVPC shares for Twin Vee PowerCats, Co.

shares, and the cancellation of Twin Vee PowerCats, Co.

shares held by

Twin Vee Inc.

Fix My Boat has been inactive for 2023 and 2022, we anticipate focusing resources on this entity in the future.

Forza X1, Inc.

was initially incorporated as Electra

Power Sports, Inc.

on October 15, 2021, and subsequently changed its name to Forza X1, Inc.

(“Forza X1” or “Forza”)

on October 29, 2021.

Prior to Forza’s incorporation on October 15, 2021, the electric

boat business was operated as the Company’s Electra Power Sports™ Division.

Following the Company’s initial public offering

that closed on July 23, 2021 (the “IPO”), it determined in October 2021 that for several reasons, that it would market the

Company’s new independent line of electric boats under a new brand name (and new subsidiary) .

On April 20, 2023, the Company formed AquaSport Co.(“AquaSport”),

a wholly owned subsidiary in the state of Florida in connection with the Company’s plan to lease the assets of former AQUASPORT™

boat brand and manufacturing facility in White Bluff Tennessee.

On December 5, 2022, pursuant to the terms of the

Agreement and Plan of Merger, dated as of September 8, 2022 (the “Merger Agreement”), by and between Twin Vee PowerCats Co.

and Twin Vee Powercats, Inc., a Florida corporation (“Twin Vee Inc.” or “TVPC”), TVPC was merged with and into

the Company (the “Merger”).

As Twin Vee Inc.

did not meet the definition of a

business under ASC 805, the merger was not accounted for as a business combination.

The Merger was accounted for as a recapitalization

of Twin Vee PowerCats, Co., effected through the exchange of TVPC shares for Twin Vee PowerCats, Co.

shares, and the cancellation of Twin

Vee PowerCats, Co.

shares held by Twin Vee Inc.

Upon the effective date of the Merger, December 5, 2022, Twin Vee Co.

accounted for the merger by assuming TVPC’s

net liabilities.

accounted for the

Merger by assuming TVPC’s net liabilities.

Twin Vee PowerCats, Co.’s financial statements reflect the operations of TVPC.

prospectively and will not be restated

retroactively to reflect the historical financial position or results of operations of TVPC.

prospectively and will not be restated retroactively to reflect the historical financial position or results of operations of TVPC.

Principles of Consolidation

The consolidated financial

statements include the accounts of Twin Vee and its wholly owned subsidiary, Fix My Boat, and majority owned subsidiary, Forza X1, collectively

referred to as the “Company”.

statements include the accounts of Twin Vee and its wholly owned subsidiary, AquaSport, Fix My Boat, and controlling interest subsidiary,

Forza X1, collectively referred to as the “Company”.

The Company’s net loss

3 unchanged sentences

All inter-company balances and transactions are eliminated in consolidation.

Common Stock Split

On May 13, 2021, the Company effected a forty thousand (40,000)-for-one stock

split to the shareholder of record as of May 13, 2021.

The stock split was in the form of a common stock dividend of 3,999,900 new

shares and all share and per share information has been retroactively adjusted to reflect the stock split.

Basis of Presentation

3 unchanged sentences

Revenue Recognition

The Company’s revenue is derived primarily from

the sale of boats, motors and trailers to its independent dealers.

The Company recognizes revenue when obligations under the terms of

a contract are satisfied and control over promised goods is transferred to the dealer.

For the majority of sales, this occurs when the

product is released to the carrier responsible for transporting it to a dealer.

The Company typically receives payment within five business

days of shipment.

Revenue is measured as the amount of consideration it expects to receive in exchange for a product.

The Company offers

dealer incentives that include wholesale rebates, retail rebates and promotions, floor plan reimbursement or cash discounts, and other

allowances that are recorded as reductions of revenues in net sales in the statements of operations.

The consideration recognized represents

the amount specified in a contract with a customer, net of estimated incentives the Company reasonably expects to pay.

The estimated liability

and reduction in revenue for dealer incentives is recorded at the time of sale.

Subsequent adjustments to incentive estimates are possible

because actual results may differ from these estimates if conditions dictate the need to enhance or reduce sales promotion and incentive

programs or if dealer achievement or other items vary from historical trends.

Accrued dealer incentives are included in accrued liabilities

in the accompanying consolidated balance sheets.

The Company’s revenue is derived primarily from the sale of boats, motors

and trailers to its independent dealers.

The Company recognizes revenue when obligations under the terms of a contract are satisfied and

control over promised goods is transferred to the dealer.

For the majority of sales, this occurs when the product is released to the carrier

responsible for transporting it to a dealer.

The Company typically receives payment within five business days of shipment.

measured as the amount of consideration it expects to receive in exchange for a product.

The Company offers dealer incentives that include

wholesale rebates, retail rebates and promotions, floor plan reimbursement or cash discounts, and other allowances that are recorded as

reductions of revenues in net sales in the consolidated statements of operations.

The consideration recognized represents the amount specified

in a contract with a customer, net of estimated incentives the Company reasonably expects to pay.

The estimated liability and reduction

in revenue for dealer incentives is recorded at the time of sale.

Subsequent adjustments to incentive estimates are possible because actual

results may differ from these estimates if conditions dictate the need to enhance or reduce sales promotion and incentive programs or

if dealer achievement or other items vary from historical trends.

Accrued dealer incentives are included in accrued liabilities in the

accompanying consolidated balance sheets.

Schedule of accounts receivable

Total accounts receivable

January 1, 2022

January 1, 2023

December 31, 2023

Payment received for the future sale of a boat to

4 unchanged sentences

as contract liabilities on the consolidated balance sheets.

These deposits are expected to be recognized as revenue within a one-year

These deposits are refundable, we are uncertain when we will be able to

recognize as revenues.

Rebates and Discounts

40 unchanged sentences

$ 22,666,301 , respectively, in excess of FDIC insured limits.

Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid

investments with original maturities of three months or less at the time of purchase.

On December 31, 2022 and 2021, the Company had cash

and cash equivalents of $ 23,501,007 and $ 6,975,302 , respectively.

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents include all highly liquid investments with original maturities of three months or less at the

time of purchase.

On December 31, 2023 and 2022,

the Company had cash and cash equivalents of $ 16,755,233 and $ 23,501,007 , respectively.

Restricted cash includes amounts that are collected and are held in connection with assets securing certain of the

Company’s financing transactions.

Restricted cash is restricted for payment of interest expense and principal on the outstanding

On December 31,2023 and 2022, included within

restricted cash on the Company’s consolidated balance sheets is an irrevocable letter of credit for $ 257,530 and $0, respectively.

Marketable Securities

Our investments in debt securities are carried at

either amortized cost or fair value.

Investments in debt securities that the Company has the positive intent and ability to hold to maturity

are carried at amortized cost and classified as held-to-maturity.

Investments in debt securities that are not classified as held-to-maturity

are carried at fair value and classified as either trading or available-for-sale.

Realized and unrealized gains and losses on trading

debt securities as well as realized gains and losses on available-for-sale debt securities are included in net income.

The Company’s investments in debt securities

are carried at either amortized cost or fair value.

Investments in debt securities that the Company has the positive intent and ability

to hold to maturity are carried at amortized cost and classified as held-to-maturity.

Investments in debt securities that are not classified

as held-to-maturity are carried at fair value and classified as either trading or available-for-sale.

Realized and unrealized gains and

losses on trading debt securities as well as realized gains and losses on available-for-sale debt securities are included in other income.

Fair Value of Financial Instruments

21 unchanged sentences

current assets or current liabilities.

Inventories are valued at the lower of cost and net

realizable value, with cost determined using the average cost method.

Accounts Receivable

The Company carries its accounts receivables net of an allowance for credit

The measurement and recognition of credit losses involves the use of judgment.

Management’s assessment of expected credit

losses includes consideration of current and expected economic conditions, market and industry factors affecting the Company’s customers

(including their financial condition), the aging of account balances, historical credit loss experience, customer concentrations, and

customer creditworthiness.

Management evaluates its experience with historical losses and then applies this historical loss ratio to financial

assets with similar characteristics.

The Company’s historical loss ratio or its determination of risk pools may be adjusted for

changes in customer, economy, market or other circumstances.

The Company may also establish an allowance for credit losses for specific

receivables when it is probable that the receivable will not be collected, and the loss can be reasonably estimated.

Amounts are written

off against the allowance when they are considered to be uncollectible, and reversals of previously reserved amounts are recognized if

a specifically reserved item is settled for an amount exceeding the previous estimate.

Inventories are valued at the lower of cost and net realizable value, with cost determined

using the weighted average cost method on a first-in first-out basis.

Net realizable value is defined as sales price less cost of completion,

4 unchanged sentences

have been made to reduce excess or obsolete inventories to their net realizable value.

At December 31, 2023 and 2022, the provision for excess or obsolete inventories

is $ 419,616 and $ 0 , respectively.

Property and Equipment

29 unchanged sentences

Schedule of product warranty liability

Balance as of beginning of year

Balance as of the beginning of year

Payments made

7 unchanged sentences

relating to new product development as incurred.

For the twelve months ended December 31, 2022 and 2021, research and development costs

amounted to $ 941,533 and $ 211,111 , respectively.

For the years ended December 31, 2023 and 2022, research and development costs amounted

to $ 1,157,585 and $ 941,533 , respectively.

Shipping and Handling Costs

Shipping and handling costs includes those costs incurred

to transport product to customers and internal handling costs, which relate to activities to prepare goods for shipment.

The Company has

elected to account for shipping and handling costs associated with outbound freight after control over a product has transferred to a

customer as a fulfillment cost.

The Company includes shipping and handling costs, including cost billed to customers, in cost of sales

in the statements of operations.

All manufactured boats are free on board (FOB), from the Fort Pierce manufacturing plant.

required to either pick up the boats themselves or contract with a transporter.

Shipping and handling costs includes those costs

incurred to transport product to customers and internal handling costs, which relate to activities to prepare goods for shipment.

The Company has elected to account for shipping and handling costs associated with outbound freight after control over a product has

transferred to a customer as a fulfillment cost.

The Company includes shipping and handling costs, including cost billed to

customers, in cost of products sold in the consolidated statements of operations.

All manufactured boats are free on board (FOB),

from the Fort Pierce manufacturing plant.

Dealers are required to either pick up the boats themselves or contract with a

For the years ended December 31, 2023, and 2022, shipping and handling costs amounted to $ 718,635

and $ 179,998 ,

respectively.

The Company determines if an arrangement is a lease

22 unchanged sentences

During the year ended

December 31, 2022, the Company purchased all engines for its boats under a supply agreement with a single vendor.

For the year ended December

31, 2022 and 2021, total purchases to this vendor were $ 5,020,973 and $ 3,149,300 , respectively.

Paycheck Protection Program

GAAP does not contain authoritative accounting

standards for forgivable loans provided by governmental entities to a for-profit entity.

Absent authoritative accounting standards, interpretative

guidance issued and commonly applied by financial statement preparers allows for the selection of accounting policies amongst acceptable

alternatives.

Based on the financial statement preparers allows for the selection of accounting policies amongst acceptable alternatives.

Based on the facts and circumstances, the Company determined it most appropriate to account for the Paycheck Protection Program (“PPP”)

loan proceeds as an in-substance government grant by analogy to International Accounting Standards 20 “(IAS 20)”, Accounting

for Government Grants and Disclosure of Government Assistance .

Under the provisions of IAS 20, “a forgivable loan from government

is treated as a government grant when there is reasonable assurance that the entity will meet the terms for forgiveness of the loan.”

IAS 20 does not define “reasonable assurance”, however, based on certain interpretations, it is analogous to “probable”

as defined in FASB ASC Subtopic 450-20-20 under U.S.

GAAP, which is the definition the Company has applied to its expectations of PPP

loan forgiveness.

Under IAS 20, government grants are recognized in earnings on a systematic basis over the periods in which the Company

recognizes costs for which the grant is intended to compensate (i.e.

qualified expenses).

Further, IAS 20 permits for the recognition

in earnings either (1) separately under a general heading such as other income, or (2) as a reduction of the related expenses.

the year ended December 31, 2021, the Company elected to recognize government grant income separately within other income to present a

clearer distinction in its consolidated financial statements.

December 31, 2023, the Company purchased all engines for its boats under supplier agreements with three vendors.

During the year ended

December 31, 2022, the Company purchased all engines for its boats under supplier agreements with one vendor.

For the years ended December

31, 2023 and 2022, total purchases from these vendors were $ 9,252,915 and $ 5,020,973 , respectively.

Employee Retention Credit

On Mach 27, 2020, the Coronavirus Aid, Relief, and

Economic Security Act (“CARES Act”) was signed into law providing numerous tax provisions and other stimulus measures, including

an employee retention credit (“ERC”), which is a refundable tax credit against certain employment taxes.

The Taxpayer Certainty

and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021 extended and expanded the availability of the ERC.

Pursuant to the employee retention credit, eligible employers could receive

a 50% or 70% credit on qualified wages against their employment taxes each quarter during the eligible period in 2020 and 2021, respectively,

with any excess credits eligible for refunds.

During the year ended December 31, 2022, the Company recognized income related to the employee

retention credit of $ 355,987 upon completion of an analysis providing reasonable assurance that the Company met the conditions set forth

in the CARES Act.

The employee retention credit is recorded in government grant income on the consolidated statement of operations during

the year ended December 31, 2022.

March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law providing numerous

tax provisions and other stimulus measures, including an employee retention credit (“ERC”), which is a refundable tax credit

against certain employment taxes.

The Taxpayer Certainty and Disaster Tax Relief Act of 2020 and the American Rescue Plan Act of 2021

extended and expanded the availability of the ERC.

Standards Codification 105, “Generally Accepted Accounting Principles,” describes the decision-making framework when no guidance

exists in US GAAP for a particular transaction.

Specifically, ASC 105-10-05-2 instructs companies to look for guidance for a similar

transaction within US GAAP and apply that guidance by analogy.

As such, forms of government assistance, such as the ERC, provided to

business entities would not be within the scope of ASC 958, but it may be applied by analogy under ASC 105-10-05-2.

We accounted for

the Employee Retention Credit as a government grant in accordance with Accounting Standards Update 2013-06, Not-for-Profit Entities (Topic

958) (“ASU 2013-06”) by analogy under ASC 105-10-05-2.

Under this standard, government grants are recognized when the conditions

on which they depend are substantially met.

the years ended December 31, 2023 and 2022, respectively, the Company received $ 1,267,055 and $ 355,987 , from the Employee Retention Credit

Stock-Based Compensation

The Company recognizes stock-based compensation costs

for its restricted stock measured at the fair value of each award at the time of grant, as an expense over

for its restricted stock and restricted stock units, measured at the fair value of each award at the time of grant, as an expense over

the period during which an employee is required to provide service.

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Recently Adopted Accounting Pronouncements

In June 2016, the FASB issued ASU No.

2016-13, “ Financial

Instruments Credit Losses —Measurement of Credit Losses on Financial Instruments.

” ASU 2016-13 requires a financial asset

(or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected, which includes

the Company’s accounts receivable.

This ASU is effective for the Company for reporting periods beginning after December 15, 2022.

The Company is currently assessing the potential impact that the adoption of this ASU will have on its consolidated financial statements.

The Company has considered all other recently issued

accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements.

In June 2016, the FASB issued Accounting Standards Update (“ASU”)

2016-13, “ Financial Instruments Credit Losses —Measurement of Credit Losses on Financial Instruments.

2016-13 requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected

to be collected, which includes the Company’s accounts receivable.

This ASU is effective for the Company for reporting periods beginning

after December 15, 2022.

The Company adopted this standard effective January 1, 2023, and the adoption of this ASU did not have a significant

impact on the consolidated financial

The Company has considered all other recently

issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its

consolidated financial statements.

Marketable Securities

Schedule of marketable Securities

As of December 31, 2023

Amortized Cost

Gross Unrealized Gains

Gross Unrealized Losses

Marketable Securities

Corporate Bonds

Certificates of Deposits

Total marketable securities

As of December 31, 2022

Amortized Cost

Gross Unrealized Gains

Gross Unrealized Losses

Marketable Securities

Corporate Bonds

$ ( 139,484 )

Certificates of Deposits

Total marketable securities

$ ( 166,114 )

Fair Value Measurements

Assets and liabilities measured at fair value on a

recurring basis based on Level 1 and Level 2 fair value measurement criteria as of December 31, 2023 and 2022 are as follows:

Schedule of fair value marketable securities

Schedule of assets and liabilities measured fair value

recurring basis

Fair Value Measurements Using

Balance as of December 31, 2023

Quoted Prices in Active Markets for Identical Assets

Significant Other Observable Inputs

Quoted Prices in Active Markets for Identical Assets (Level 1)

Significant Other Observable Inputs (Level 2)

Significant Nonobservable Inputs (Level 3)

1 unchanged sentence

Corporate Bonds

Certificates of Deposits

Total marketable securities

1 unchanged sentence

Balance as of December 31, 2022

Quoted Prices in Active Markets for Identical Assets

Significant Other Observable Inputs

Quoted Prices in Active Markets for Identical Assets (Level 1)

Significant Other Observable Inputs (Level 2)

Significant Nonobservable Inputs (Level 3)

4 unchanged sentences

The Company’s investments in corporate bonds

commercial paper and certificated of deposits are measured based on quotes from market makers for similar items in active markets.

are measured based on quotes from market makers for similar items in active markets.

At December 31, 2023 and 2022 inventories consisted

2 unchanged sentences

Raw Materials

Inventory in transit

Work in Process

1 unchanged sentence

Total Inventory

Reserve for Excess and Obsolete

Net inventory

Property and Equipment

8 unchanged sentences

Electric prototypes and tooling

Assets under construction

Less accumulated depreciation and amortization

( 2,382,832 )

( 1,058,391 )

Depreciation and amortization expense of property

17 unchanged sentences

These are amortized through the right-of-use asset as reductions of expense over the lease term.

The Company leases its office and warehouse

facilities, and the land which are located at 3101 S US-1, Fort Pierce, Florida (the “Property”) from Visconti Holdings,

Visconti Holdings, LLC is a single member LLC that holds the ownership of the property, and its sole member is Joseph C.

Visconti, the CEO of the Company and the CEO and majority shareholder of the Company’s parent company.

The Company entered

into the lease on January 1, 2020, and as amended January 1, 2021, the lease has a term of five 5 years.

The current base rent

payment is $ 30,000 per

month including property taxes and the lease required a $ 25,000 security

The base rent will increase five percent (5%) on the anniversary of each annual term.

The Company leases its office and warehouse facilities,

and the land which are located at 3101 S US-1, Fort Pierce, Florida (the “Property”) from Visconti Holdings, LLC.

Holdings, LLC is a single member LLC that holds the ownership of the property, and its sole member is Joseph C.

Visconti, the CEO of the

Company and the CEO and majority shareholder of the Company’s parent company.

The Company entered into the lease on January 1, 2020,

and as amended January 1, 2021, the lease has a term of five years.

The current base rent payment is $ 30,000 per month including

property taxes and the lease required a $ 25,000 security deposit.

The base rent will increase five percent (5%) on the anniversary

of each annual term.

At December 31, 2023 and 2022, supplemental balance

sheet information related to leases were as follows:

Schedule of leases supplemental balance sheet information

Schedule of supplemental balance sheet information

related to leases

Operating lease ROU asset

4 unchanged sentences

under the non-cancelable operating leases are as follows:

Schedule of maturities of lease liabilities

Schedule of future minimum lease payments

Year Ending December 31,

3 unchanged sentences

operating lease:

Schedule of operating lease cost

Schedule of other supplemental information

Weighted average discount rate

9 unchanged sentences

rates corresponding to the maturities of the leases.

We used the U.S.

Treasury rate of 0.33 % at December 31, 2022.

The Company leases a warehouse facility, and the land

15 unchanged sentences

under the non-cancelable operating leases are as follows:

of future minimum lease payments under the non-cancelable

Year Ending December 31,

Total lease payment

Less imputed interest

4 unchanged sentences

Weighted average remaining lease term (years)

Finance Leases

Vehicle and Equipment Lease

The Company has finance leases for a vehicle,

two forklifts, and a copy machine.

The Company entered into the vehicle lease in February of 2023, with an asset value of $ 48,826 ,

which is recorded in net property and equipment on the consolidated balance sheet, it is a 60 -month

lease at a 3 %

interest rate.

At December 31, 2023 and 2022, the net book value was $40,688 and $0, respectively.

The Company entered into the

first forklift lease in January of 2023, with an asset value of $ 43,579 ,

which is recorded in net property and equipment on the consolidated balance sheet.

It is a 60 -month

lease at a 7.5 %

interest rate.

At December 31, 2023 and 2022, the net book value was $ 37,042 and $ 0 , respectively The Company entered into the

second forklift lease in July of 2023, with an asset value of $ 35,508 ,

which is recorded in net property and equipment on the consolidated balance sheet.

It is a 60 -month

lease at a 5.0 %

interest rate.

At December 31, 2023 and 2022, the net book value was $ 34,239 and $ 0 , respectively.

The Company entered into the

copier lease in July of 2023, with an asset value of $ 14,245 ,

which is recorded in net property and equipment on the consolidated balance sheet.

It is a 60 -month

lease at a 7.0 %

interest rate.

At December 31, 2023 and 2022, the net book value was $ 13,566 and

AquaSport lease

On April 20, 2023 Twin Vee incorporated AquaSport

Co., a wholly owned subsidiary, in the state of Florida in connection with its plan to lease the AQUASPORT™ boat brand and manufacturing

facility in White Bluff Tennessee.

On May 5, 2023, Twin Vee and AquaSport Co.

entered into an agreement with Ebbtide Corporation (“Ebbtide”)

providing AquaSport Co.

with the right to acquire assets, AQUASPORT™ boat brand, trademarks, 150,000-square-foot manufacturing facility

situated on 18.5 acres in White Bluff Tennessee, related tooling, molds, and equipment to build five Aquasport models ranging in size

from 21 to 25-foot boats (the “AquaSport Assets”).

Under the Agreement, the Company has the right

to purchase the AquaSport Assets from Ebbtide for $ 3,100,000 during the five-year term of the Agreement (or extension period), less

credit for a $ 300,000 security deposit paid by the Company and $16,000 a month for any rent paid under the Agreement by AquaSport

AquaSport Co.

will lease the AquaSport Assets from Ebbtide under the Agreement at a monthly rent of $ 22,000 with

the option to acquire the AquaSport Assets.

The lease is for a term of five years, commencing June 1, 2023 at a 2.93 % interest

rate, with one option to renew the lease for an additional five years.

In the event AquaSport Co.

commits three payment Events of Default

(as defined in the Agreement) within any consecutive two-year period or commits any other material Event of Default that is not cured

timely and remains uncured, Ebbtide may terminate AquaSport’s rights under the Agreement to acquire the AquaSport Assets.

Ebbtide has the right to terminate the Agreement if an Event of Default occurs.

AquaSport’s obligations under the Agreement have

been guaranteed by the Company.

Finance leases on the AquaSport lease are recorded

in property and equipment, net on the consolidated balance sheet.

Schedule of finance lease in property and equipment

At December 31, 2023 and 2022, supplemental balance

sheet information related to finance leases were as follows:

Schedule of supplemental balance sheet of finance lease

Finance lease liabilities:

Current portion

Non-current portion

At December 31, 2023, future minimum lease payments

under the non-cancelable finance leases are as follows:

Schedule of future minimum lease payments of finance lease

Year Ending December 31,

Total lease payment

Less imputed interest

The following summarizes other supplemental information about the Company’s

finance lease:

Schedule of summarize other supplemental information of finance lease

Weighted average discount rate

Weighted average remaining lease term (years)

Accrued Liabilities

8 unchanged sentences

Accrued operating expense

Accrued assets under construction

Accrued inventory

1 unchanged sentence

Total accrued liabilities

Government Grant Income – Paycheck

Protection Program

In response to the coronavirus disease (“Covid-19”)

COVID-19 pandemic, the second PPP was established under Consolidated Appropriations Act (“CAA”) and administered by the Small

Business Administration (“SBA”).

Companies who met the eligibility requirements set forth by the PPP could qualify for PPP

If the loan proceeds are fully utilized to pay qualified expenses, the full principal amount of the PPP loan, along with any accrued

interest, may qualify for loan forgiveness, subject to potential reduction based on the level of full-time employees maintained by the

organization.

On March 19, 2021, the Company received a loan of

$ 608,224 under the PPP provided by SunTrust/Trust Bank.

The loan bears interest

at 1.0 % and has an initial deferment period wherein no payments are due until the application for forgiveness is submitted, not to

exceed ten months from the covered period.

After the deferment period, if the loan is not forgiven under the terms of the PPP, the loan

and interest will be paid back over the remaining period through maturity in March 2026.

Funds from the loan may only be used for payroll

costs, costs used to continue group health care benefits, mortgage payments, rent, utilities, and interest on other debt obligations.

When it applied for the loan, the Company believed it would qualify to have the loan forgiven under the terms of the PPP and therefore

consider the loan to be substantively a conditional government grant to be accounted for using an analogy to IAS 20.

As the Company believes that it completed the required

activities by utilizing the PPP proceeds for payroll and other qualified expenditures prior to December 31, 2021, it has recognized PPP

government grant income for the full amount of the PPP loan, $608,224, and no liability for the PPP loan is reflected in the consolidated

balance sheet as of December 31, 2021.

Short-term Debt

On December 31, 2023 and 2022, the Company had a

line of credit with Wells Fargo and Yamaha Motor Finance for $ 1,250,000 and

$ 1,250,000 ,

respectively.

Interest on our Wells Fargo line is calculated in two ways, the average daily balance is prime +5%, with a minimum

prime at 5.5%, there is also a monthly flat charge of 0.2%, which, is 2.4% annualized.

After the 150-day due in full period, the

average daily balance rate goes up to prime +8.5% with no monthly flat charge.

On December 31, 2023 and 2022, our interest rate was

11.6% and 6.5%.

Interest on our Yamaha line is calculated on the average daily balance +4%, with a minimum prime at 8.0%.

December 31, 2023 and 2022, our interest rate was 16.8% and 0%, respectively.

On December 31, 2023 and 2022, the outstanding balance

with Wells Fargo was $ 231,736 and

respectively.

On December 31, 2023 and 2022, the outstanding balance with Yamaha Motor Finance was $ 210,674 and

respectively.

The outstanding balances are included in account payable on the consolidated balance sheet.

Notes Payable – SBA EIDL Loan

18 unchanged sentences

Schedule of minimum maturities

Year Ending December 31,

2028 and thereafter

Related Party Transactions

On December 31, 2018, the Company entered into a loan

and promissory note with Joseph C.

Visconti, the CEO and majority shareholder of the Company.

The principal amount of the loan was $ 525,500 ,

together with a simple interest rate of 6 % on the balance of principal remaining unpaid.

During the year ended December 31, 2021, the

Company repaid $27,850.

At December 31, 2021, the outstanding amount of the note payable was $ 0 .

As discussed in note 6, the Company has leased its

facilities from a company owned by its CEO.

During the year ended December 31, 2021, we received

a cash payment in the amount of $ 24,300 from Boat Fuji, Inc., a company owned 33 % by Joseph Visconti, our chief executive officer, for

future technical website support expenses to be incurred by us on behalf of Boat Fuji, Inc.

During the year ended December 31, 2021, we

paid $ 15,808 to certain affiliate companies or on their behalf, including (i) $ 2,000 that was repaid to Boat Fuji, Inc.

due to a decrease

in the estimated expenses to be paid by us on its behalf, (ii) $ 12,000 of franchise fee development expenses paid by us on behalf

of My Boat MD, Inc., a wholly owned subsidiary of Twin Vee PowerCats, Inc and (iii) $ 1,808 of expenses paid to Twin Vee PowerCats, Inc.

for reimbursement of telephone, internet and other similar expenses incurred by it on our behalf.

During the year ended December 31, 2022, we recorded

$ 15,000 of professional fees, for consulting work for Twin Vee performed by Jim Leffew, the Chief Executive Officer of Forza.

In connection

with the closing of Forza’s initial public offering, we entered into a transition services agreement (the “Transition Services

Agreement”) with Forza, pursuant to which we agreed to provide Forza, at our cost, with certain services, such as procurement, shipping,

receiving, storage and use of our facility until Forza’ s new planned facility is completed.

Forza’s ability to utilize our

manufacturing capacity pending completion of its own facility will be subject to its availability as determined by us.

The Transition

Services Agreement operates on a month-to-month basis.

In 2021, the Company had purchases of $ 90,417 , from

a related party.

The Company paid $ 90,417 to our parent company, Twin Vee PowerCats, Inc., to purchase a 36-foot used catamaran boat.

During the year ended December 31, 2022 and 2021,

the Company received cash of $ 14,549 and $ 44,628 from its affiliate companies, and paid $ 57,659 and $ 3,111,100 to its

affiliate companies, respectively.

During the year ended December 31, 2022 and 2021,

the Company recorded management fees of $ 54,000 and $ 42,000 , respectively, paid to its majority shareholder company, Twin Vee PowerCats,

During the year ended December 31, 2022, the Company

issued 20,000 shares valued at $ 52,400 for payment on behalf of our former Parent company.

At December 31, 2022 and 2021, advances from affiliated

companies included in due to affiliated companies was $ 0 and $ 115,043 , respectively.

Approximately $ 93,000 of the balance is related

to an equipment purchase, the remaining balance was related to startup costs for our franchise business.

During the year ended December 31, 2022, Twin Vee

received a monthly fee of $ 5,850 to provide management services and facility utilization to Forza.

This income for Twin Vee, and

expense for Forza, has been eliminated in the consolidated financial statements.

During the years ended December 31, 2023 and 2022,

respectively, we recorded $ 36,000 and $ 24,225 of professional fees, for consulting work for Twin Vee performed by Jim Leffew, the Chief

Executive Officer of Forza.

Additionally, during the years ended December 31, 2023 and 2022, respectively, Aqua Sport recorded expense

of $50,000 and $0, for compensation for his work to start up the Tennessee facility.

During the years ended December 31, 2023 and 2022,

the Company received a monthly fee of $ 6,800 and $ 5,000 , respectively, to provide management services and facility utilization

This income for the Company, and expense for Forza, has been eliminated in the consolidated financial statements.

In August of 2022, Forza signed a six-month lease

for a duplex on a property in Black Mountain, NC, to be used by its traveling employees during the construction of its new manufacturing

facility, for $ 2,500 per month.

After the initial term of the lease, it was extended on a month-to-month basis.

In August of 2023,

the president of Forza, James Leffew, purchased the property, and Forza executed a new lease agreement with Mr.

Leffew on the same month-to-month

For the years ended December 31, 2023 and 2022, the lease expense was $ 20,000 and $ 10,036 , respectively.

Commitments and Contingencies

2 unchanged sentences

to repurchase new inventory repossessed from dealerships by financial institutions that provide credit to the Company’s dealers.

The maximum obligation of the Company under such floor plan agreements totaled approximately $ 10,693,000 or 67 units, and $ 4,273,000 or

The maximum obligation of the Company under such floor plan agreements totaled $ 10,510,252 or 76 units, and $ 10,693,000 or

67 units, as of December 31, 2023, and December 31, 2022, respectively.

The Company incurred no impact from repurchase events during

the year ended December 31, 2022 and year ended December 31, 2021.

the years ended December 31, 2023 and December 31, 2022.

Short-term lease

37 unchanged sentences

automatically increased on January 1, 2022.

As of December 31, 2022, there were 377,090 shares remaining available for grant

under this Plan.

As of December 31, 2023, there were shares remaining available for grant under this Plan.

Accounting for Stock-Based Compensation

1 unchanged sentence

For the year ended December 31, 2023 and 2022, the

Company recorded $ 990,406 and $ 309,832 , respectively, of stock-based compensation expense, which is included in salaries and

wages on the accompanying consolidated statement of operations.

Company recorded $ 1,902,749 and $ 1,448,751 , respectively, of stock-based compensation expense, which is included in salaries

and wages on the accompanying consolidated statement of operations.

Stock Options

27 unchanged sentences

The Company has never paid a dividend, and as such the dividend yield is 0.0 %

Schedule of expected volatility of option

Schedule of option activity

Options Outstanding

Weighted Average

Remaining life

Average Remaining life

Exercise Price

5 unchanged sentences

Exercisable options, December 31, 2023

At December 31, 2022, 635,542 Twin Vee options

At December 31, 2023, 400,572 share of Twin Vee options

are unvested and expected to vest over the next four years.

Restricted Stock Units

Under the Company’s

2021 Stock Incentive Plan the Company has issued restricted stock units (“RSUs”).

RSUs are granted with a fair value equal

to the closing market price of our common stock on the business day of the grant date.

An award may vest completely at a point in time

(cliff-vest) or in increments over time (graded-vest).

Generally, RSUs vest over three years.

Schedule of restricted stock options

Restricted Stock Units Outstanding

Weighted Average Grant – Date

Average Remaining life

Aggregate Intrinsic

Fair Value Price

Outstanding, December 31, 2022

Forfeited/canceled

Outstanding, December 31, 2023

Common Stock Warrants

As of December 31, 2023, Forza had outstanding warrants

to purchase 172,500 shares of common stock issuable at a weighted-average exercise price of $ 6.25 per share that were issued

to the representative of the underwriters on August 16, 2022 in connection with the Company’s IPO.

The representative’s warrants

are exercisable at any time and from time to time, in whole or in part, and expire on August 16, 2027.

There was no warrant activity during

the year ended December 31, 2022.

to purchase shares of common stock issuable at a weighted-average exercise price of $ 6.25 per share that were issued to the representative

of the underwriters on August 16, 2022 in connection with the Company’s IPO.

The representative’s warrants are exercisable

at any time and from time to time, in whole or in part, and expire on August 16, 2027.

There was no warrant activity during the year ended

December 31, 2023.

Equity Compensation Plan

The Company maintains an

equity compensation plan (the “Plan”) under which it may award employees, directors and consultants’ incentive and non-qualified

stock options, restricted stock, stock appreciation rights and other stock-based awards with terms established by the Compensation Committee

of the Board of Directors which has been appointed by the Board of Directors to administer the plan.

The number of awards under the Plan

will automatically increase on January 1, 2023.

As of December 31, 2022, there were 683,500 shares remaining available for grant

under this Plan.

Stock based compensation expense is included in the Statements of Operations, under salaries and wages.

The Company maintains an equity compensation plan (the “Plan”)

under which it may award employees, directors and consultants’ incentive and non-qualified stock options, restricted stock, stock

appreciation rights and other stock-based awards with terms established by the Compensation Committee of the Board of Directors which

has been appointed by the Board of Directors to administer the plan.

The number of awards under the Plan will automatically increase on

January 1, 2023.

As of December 31, 2023, there were shares remaining available for grant under this Plan.

Stock based compensation expense

is included in the consolidated statements of operations, under salaries and wages.

Accounting for Stock -Based Compensation

For the year ended December 31, 2023 and 2022, Forza

recorded $ 458,345 and $ 0 , respectively, of stock-based compensation expense, which is included in salaries and wages on the

accompanying consolidated statement of operations.

recorded $ 1,345,270 and $ 458,346 , respectively, of stock-based compensation expense, which is included in salaries and wages on

the accompanying consolidated statement of operations.

Stock Options

12 unchanged sentences

Schedule of assumptions

ended December 31, 2023

Expected term

3 unchanged sentences

2.98 – 4.72 %

2.98 – 3.62 %

The expected volatility of the option is determined

6 unchanged sentences

Forza has never paid a dividend, and as such the dividend yield is 0.0 %

Schedule of expected volatility of option

Schedule of options activity

Options Outstanding

Weighted Average

Remaining life

Average Remaining life

Fair value of

Exercise Price

5 unchanged sentences

Exercisable options, December 31, 2023

At December 31, 2022, 1,323,514 Forza options

are unvested and expected to vest over the next three years.

At December 31, 2023, Forza options are unvested and

expected to vest over the next three years.

Customer and Supplier Concentration

3 unchanged sentences

had sales of over 10 % of our total sales, and one customer represented 10 % of total sales.

During the year ended December 31, 2021, five individual customers had sales of over 10 % of our total sales and combined these five customers

represented 67% of total sales.

During the year

ended December 31, 2022, we purchased substantial portion of materials from two third-party vendors (27%).

As of December 31, 2022, the

amount due to the vendors was $ 845,042 .

During the year ended December 31, 2021, we purchased substantial portion of materials from two

third-party vendors (454%).

As of December 31, 2021, the amount due to the vendors was $ 804,098 .

The Company believe there are other suppliers

that could be substituted should the supplier become unavailable or non- competitive.

Gain from Insurance recovery

During May 2021, the Company experienced a thermal

event on the electric boat prototype rendering it unusable for further testing.

Additionally, the Company experienced a building

fire in one of the outer storage buildings resulting in the need for demolition.

This had no impact on production as this was an extra

storage building not necessary for business operations.

The Company recorded a loss on disposal of asset from fire of $ 249,499 and

gain from insurance recovery of $ 434,724 , during the year ended December 31, 2021.

During the year ended December 31, 2022, one individual customer had sales of over 10 % of our total sales and one customer represented 12 %

of total sales.

year ended December 31, 2023, we purchased a substantial portion of materials from one third-party vendors.

As of December 31, 2023,

the amount due to the vendors was $ 396,828 .

During the year ended December 31, 2022, we purchased a substantial portion of materials from two third-party vendors.

December 31, 2022, the amount due to the vendors was $ 845,042 .

The Company believe there are other suppliers that could be substituted should the supplier become unavailable or

non-competitive.

Due to operating losses and the recognition of valuation

allowances, the Company has no provision for a current and deferred federal or state income taxes in 2021.

allowances, the Company has no provision for current and deferred federal or state income taxes in 2022.

In 2021, the Company reversed

18 unchanged sentences

against its deferred tax assets due to the uncertainty surrounding the realization of such assets.

During year ended December 31, 2021,

the Twin Vee valuation allowance increased by approximately $ 1,176,000 and the Forza X1 valuation allowance increased by approximately

The Company has net operating and economic loss carry-forwards of approximately $ 5.0 million available to offset future

federal and state taxable income.

During years ended December 31, 2023

and 2022, respectively the Twin Vee valuation allowance increased by approximately $ 2,749,000 and $ 1,176,000 and the Forza X1 valuation

allowance increased by approximately S 343,000 and $ 532,000 .

The Company has net operating and economic loss carry-forwards of approximately

$ 8.6 million available to offset future federal and state taxable income.

A reconciliation between expected income taxes, computed

10 unchanged sentences

Tax returns for the years 2020 to 2022, are subject to review by the tax authorities.

Net (Loss) Income Per Share

Net Loss Per Share

Basic net loss per share has been computed on the

12 unchanged sentences

Effect of dilutive stock options

For diluted net losse per share - weighted average common shares outstanding

For diluted net loss per share - weighted average common shares outstanding

Net loss per share -Basic:

22 unchanged sentences

segments for the three and year ended December 31, 2023 and 2022:

of reportable segments

Schedule of reportable segments

For the Year Ended December 31, 2023

Electric Boat

Gas-Powered Boats

Electric Boat and Development

Cost of products sold

Operating expense

Income (loss) from operations

Loss from operations

( 5,390,613 )

6 unchanged sentences

For the Year Ended December 31, 2022

Electric Boat

Gas-Powered Boats

Electric Boat and Development

Cost of products sold

3 unchanged sentences

( 3,600,906 )

( 6,021,708 )

Other income (expense)

3 unchanged sentences

Property and equipment, net classified by business were as follows:

Schedule of segment reporting information by segment

Schedule of property and equipment, net classified by business

Gas-Powered Boats

2 unchanged sentences

The Company has evaluated all event or transactions

that occurred after December 31, 2022 through March 28, 2023, which is the date that the consolidated financial statements were

available to be issued.

During this period, there were no material subsequent events requiring recognition or disclosure, other than the

ones described below.

On February 3, 2023, Ms.

Nicole Camacho, the

Chief Financial of Forza X1, Inc., provided the Company notice of her resignation as an executive officer of the Company, effective February

Camacho informed the Company that she was resigning from the Company as an executive officer to pursue another opportunity

and that her resignation was not the result of any disagreement relating to the Company’s operations, policies or practices.

On February 6, 2023, the

Board of Directors (the “Board”) of Forza, appointed Carrie Gunnerson to the position of Interim Chief Financial Officer and

Interim Principal Financial and Accounting Officer.

that occurred after December 31, 2023 through March 25, 2024, which is the date that the consolidated financial statements were available

to be issued.

During this period, there were no material subsequent events requiring recognition or disclosure, other than the ones described

On January 1, 2024, our 2021 Stock Incentive Plan

automatically increased, and will continue to increase on January 1 of each calendar year for a period of ten years commencing on January

1, 2022 and ending on (and including) January 1, 2031, in a number of shares of common stock equal to 4.5% of the total number of shares

of common stock outstanding on December 31 of the preceding calendar year.

For 2024, the maximum number of common stock shares that can

be issued will be 4,284,000 .

On March 4, 2024, Mrs.

Carrie Gunnerson,

the Company’s then Chief Financial Officer, provided the Company notice of her resignation as an executive officer of the Company

and of Forza, effective May 31, 2024.

Gunnerson informed the Company that she was resigning to pursue another opportunity and that

her resignation was not the result of any disagreement relating to the Company’s operations, policies or practices .

James Leffew, Forza X1’s then Chief Executive Officer, provided the Company notice of his resignation as an executive

officer of the Company, effective June 2, 2024.

Leffew informed Forza X1 that he was resigning from the Company as an executive officer

to pursue another opportunity and that his resignation was not the result of any disagreement relating to the Company’s operations,

policies or practices.

Changes in and Disagreements with Accountants on Accounting

1 unchanged sentence

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.

What changed 10-K

Item 8. Financial Statements and Supplementary Data