Filed 2025-09-29 · Period ending 2025-06-30 · 26,895 words · SEC EDGAR
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# NeoVolta Inc. (NEOV) — 10-K
**Filed:** 2025-09-29
**Period ending:** 2025-06-30
**Accession:** 0001683168-25-007304
**Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/1748137/000168316825007304/)
**Origin leaf:** 690418502ceb3bb011e1d06a67213d2e51669ee7b842399892d00c3503750a4a
**Words:** 26,895
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**Table of Contents
UNITED STATES**
**SECURITIES AND EXCHANGE COMMISSION**
**WASHINGTON, D.C., 20549**
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**FORM 10-K**
x
**ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**
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**For the year ended June 30, 2025**
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**OR**
o
**TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**
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**Commission File Number:
001-41447**
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***NeoVolta, Inc.**
(Exact name of registrant as specified in its charter)
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Nevada |
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82-5299263 | |
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(State or other jurisdiction
of incorporation) |
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(I.R.S. Employer
Identification No.) | |
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12195 Dearborn Place
Poway, CA |
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92064 | |
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(Address of principal
executive offices) |
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(zip code) | |
Registrants telephone number, including
area code: **(800) 364-5464**
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**Securities registered pursuant to Section 12(b)
of the Act:**
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Title of each class |
Trading Symbol (s) |
Name of each exchange on which registered | |
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Common Stock, par value $0.001 per share |
NEOV |
The NASDAQ Stock Market LLC | |
|
Warrants, each warrant exercisable for one share of common stock |
NEOVW |
The NASDAQ Stock Market LLC | |
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**Securities registered
pursuant to Section 12(g) of the Act:**None
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Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act.YesNo
Indicate by check mark if the registrant is not
required to file reports pursuant to Section13 or Section15(d) of the Act.YesNo
Indicate by check mark whether the registrant
(1)has filed all reports required to be filed by Section13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter periods as the registrant was required to file such reports) and (2)has been subject to such filing
requirements for the past 90days.YesNo
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding
12 months (or for such shorter period that the registrant was required to submit such files). YesNo
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large
accelerated filer, accelerated filer, smaller reporting company and "emerging growth company"
in Rule 12b-2 of the Exchange Act. (check one)
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Large accelerated filer |
o |
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Accelerated filer |
o | |
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Non-accelerated filer |
x |
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Smaller reporting company |
x | |
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Emerging growth company |
x | |
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant
has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financial
reporting under Section 404 (b) of the Sarbanes-Oxley Act (15 U.S.C. 7262 (b)) by the registered public accounting firm that prepared
or issued its audit report.
If securities are registered pursuant to Section 12(b) of the Act,
indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to
previously issued financial statements.
Indicate by check mark whether any of those error corrections are
restatements that required a recovery analysis of incentive-based compensation received by any of the registrants executive officers
during the relevant recovery period pursuant to 240.10D-1(b).
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12b-2 of the Act). YESNO
The aggregate market value of the registrants
voting equity held by non-affiliates of the registrant, computed by reference to the price at which the common stock was last sold as
of the last business day of the registrants most recently completed second fiscal quarter, was approximately $147.9 million. In
determining the market value of the voting equity held by non-affiliates, securities of the registrant beneficially owned by directors,
officers and 10% or greater shareholders of the registrant have been excluded. This determination of affiliate status is not necessarily
a conclusive determination for other purposes.
The number of shares of the registrants
common stock outstanding as of September 29, 2025 was 34,213,838.
**DOCUMENTS INCORPORATED BY REFERENCE**
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Portions of this registrants definitive
proxy statement for its 2025 Annual Meeting of Stockholders to be filed with the SEC no later than 120 days after the end of the registrants
fiscal year are incorporated herein by reference in Part III of this Annual Report on Form 10-K.
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**Table of Contents**
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS |
1 | |
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PART I |
2 | |
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ITEM 1. BUSINESS |
2 | |
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ITEM 1A. RISK FACTORS |
9 | |
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ITEM 1B. UNRESOLVED STAFF COMMENTS |
20 | |
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ITEM 1C. CYBERSECURITY |
20 | |
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ITEM 2. PROPERTIES |
21 | |
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ITEM 3. LEGAL PROCEEDINGS |
21 | |
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ITEM 4. MINE SAFETY DISCLOSURES |
21 | |
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PART II |
22 | |
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ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |
22 | |
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ITEM 6. [RESERVED] |
23 | |
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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
23 | |
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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS |
26 | |
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
27 | |
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
41 | |
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ITEM 9A. CONTROLS AND PROCEDURES |
41 | |
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ITEM 9B. OTHER INFORMATION |
42 | |
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ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS |
42 | |
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PART III |
43 | |
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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE |
43 | |
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ITEM 11. EXECUTIVE COMPENSATION |
43 | |
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
43 | |
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE |
44 | |
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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES |
44 | |
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PART IV |
45 | |
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ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS |
45 | |
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ITEM 16. FORM 10-K SUMMARY |
46 | |
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| | i | | |
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This Annual Report on Form
10-K (this Report) contains certain statements that constitute forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange
Act of 1934, as amended (the Exchange Act). The words believe, may, will, potentially,
estimate, continue, anticipate, intend, could, would,
project, plan, expect and the negative and plural forms of these words and similar expressions
are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. Those statements
appear in this Report, particularly in the sections titled Business, Managements Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors,
and include statements regarding the intent, belief or current expectations of the Company and management that are subject to known and
unknown risks, uncertainties and assumptions.
Forward-looking statements
include, but are not limited to, statements about:
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| our ability to obtain additional funding to develop and market
our products; |
|
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| the need to obtain regulatory approval of our products in the
states in which we operate or expect to operate in the future; |
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| our ability to market our products; |
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| market acceptance of our products; |
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| competition from existing products or new products that may emerge; |
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| potential product liability claims; |
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| our dependency on third-party manufacturers to supply or manufacture
our products; |
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| our ability to establish or maintain collaborations, licensing
or other arrangements; |
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| our ability and third parties abilities to protect intellectual
property rights; |
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| our ability to adequately support future growth; and |
|
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| our ability to attract and retain key personnel to manage our
business effectively. |
|
Because forward-looking statements
are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely upon forward-looking
statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved
or occur and actual results could differ materially from those projected in the forward-looking statements. Forward-looking statements
speak only as of the date of this Report or the date of any document incorporated by reference in this Report, as applicable. Except as
required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we do not plan
to publicly update or revise any forward-looking statements contained herein after we distribute this Report, whether as a result of any
new information, future events or otherwise.
You should not rely upon forward-looking
statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this
Report to conform our prior statements to actual results or revised expectations, and we do not intend to do so, except as otherwise provided
by law.
You should read the matters
described in Risk Factors and the other cautionary statements made in this Report, as being
applicable to all related forward-looking statements wherever they appear in this Report.
This information should be
read in conjunction with the audited financial statements and the notes thereto included in this Report.
Our logo and some of our trademarks
and tradenames are used in this Report. This Report also includes trademarks, tradenames and service marks that are the property of others.
Solely for convenience, trademarks, tradenames and service marks referred to in this Report may appear without the , and
SM symbols. References to our trademarks, tradenames and service marks are not intended to indicate in any way that we will not assert
to the fullest extent under applicable law our rights or the rights of the applicable licensors if any, nor that respective owners to
other intellectual property rights will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend
the use or display of other companies trademarks and trade names to imply a relationship with, or endorsement or sponsorship of
us by, any other companies.
Unless the context requires
otherwise, references to the Company, we, us, our, NeoVolta, refer
specifically to NeoVolta, Inc.
| | 1 | | |
PART I
ITEM 1. BUSINESS
**Overview**
We are a designer and manufacturer
of high-performance energy storage systems (ESS) for residential and commercial applications. Our product portfolio includes
the NV14, NV24, NVPlus, NV7600 stand-alone inverter, and most recently, the NV16 kW AC hybrid inverter with 24 kW PV input and a 250 kW
/ 430 kWh commercial and industrial (C&I) system. Our systems combine lithium iron phosphate (LiFePO) battery
technology with hybrid inverter capability, providing safe, flexible, and adaptable solutions for backup power, self-consumption, and
energy resilience.
We market and sell our products
primarily through certified solar installers and regional and national distributors. Initially focused on Southern California, we have
since expanded into other markets throughout the United States and Puerto Rico. Looking forward, we intend to grow across residential,
commercial, and industrial segments while building financing solutions and pursuing domestic and FEOC-compliant sourcing to support long-term
competitiveness.
****
**History**
We were founded in 2018 to
develop safe, reliable, and versatile residential energy storage systems. Later that year, we produced our first prototype of the NV14,
which received certification and approval from the California Energy Commission in early 2019. Customer installations began shortly thereafter
in San Diego County following approval from San Diego Gas & Electric.
Between 2020 and 2022, we
expanded beyond Southern California into other major metropolitan regions and ultimately into more than 15 additional states and territories.
During this period, we introduced the NV24 expansion battery and continued to secure certifications under evolving California and national
regulatory standards.
In 2023, we transitioned from
contract manufacturing to in-house production by hiring key personnel and assuming direct responsibility for manufacturing operations
in Poway, California. This change enhanced quality control and supply chain resilience.
Since 2024, we have broadened
our product portfolio with the launch of the NVPlus energy storage system and the NV7600 stand-alone inverter, extending our reach into
higher-capacity residential and light commercial applications. In February 2025, we expanded into a larger facility in Poway to support
increased production. Subsequent to fiscal year end, we announced two additional products: a 250 kW / 430 kWh Commercial & Industrial
(C&I) Battery Energy Storage System, and the NV16 kW AC hybrid inverter with 24 kW PV input, expected to be available beginning in
November 2025.
| | 2 | | |
**Our Products**
We design and manufacture
energy storage systems (ESS) that combine lithium iron phosphate (LiFePO) battery technology with integrated or stand-alone
inverters to provide safe, reliable backup power for residential and light commercial applications. All systems are NEMA 3R rated for
indoor or outdoor installation, UL 9540/9540A certified, and compatible with both AC- and DC-coupled solar configurations.
|
| NV14 Our flagship ESS, the NV14
integrates a 14.4 kWh battery with a 7.6 kW hybrid inverter capable of 120V/240V residential and 208V three-phase commercial operation.
The system is designed for energy efficiency, time-of-use optimization, and backup power. | |
|
| NV24 The NV24 expansion battery
increases NV14 capacity from 14.4 kWh to 24.0 kWh without requiring an additional inverter, allowing customers to scale storage at lower
cost. | |
|
| NVPlus Introduced in 2024, NVPlus
is a higher-capacity ESS developed for larger residential and small commercial applications. It provides extended runtime, supports greater
solar inputs, and is designed for customers requiring whole-home backup or higher daily cycling. | |
|
| NV7600 A stand-alone 7.6 kW inverter
launched in 2024, designed for use with NeoVolta storage products or as a retrofit solution for existing solar systems. | |
In addition to these core
products, we have also developed the NV14-K, a custom variant of the NV14 engineered to EOS Linx specifications. This product is manufactured
on a limited basis for a single customer application and is not marketed generally.
Subsequent to fiscal year
end, we announced two additional products: (i) a Commercial & Industrial Battery Energy Storage System (BESS) with a 250 kW power
rating and 430 kWh usable capacity, designed for larger-scale applications; and (ii) the NV16 kW AC hybrid inverter with 24 kW PV input,
developed to support higher-capacity residential installations and whole-home backup. The NV16 kW inverter is expected to become generally
available in November 2025.
| | 3 | | |
**Market Overview**
Our addressable market is
expanding across multiple customer segments, supported by favorable policy, resiliency needs, and evolving financing and distribution
models.
Residential Retrofit*.
There are an estimated 4.2 million U.S. homes equipped with solar panels, and more than 3 million of these do not currently have battery
storage. (SolarInsure) This represents a significant retrofit opportunity, particularly as installed inverters approach end of life after
1015 years of operation. Grid reliability concerns, increasingly common utility outages, and changing rate structures are expected
to accelerate adoption of storage among this installed base.
*New Residential and Small
Commercial Installations*. The U.S. installer market is highly fragmented, with more than 11,000 companies nationwide, most of them
small independent operators not typically serviced by larger ESS providers. These smaller installers represent NeoVoltas core customers.
Once certified, they generally become recurring purchasers, relying on just-in-time availability to serve homeowners who prefer not to
stock or pre-finance equipment.
Battery adoption in new solar
projects is rising rapidly. Nationally, only about 6% of residential solar systems included storage in 2020, compared to an estimated
1520% by 2024. (Clean Energy Group) In California, adoption has been even stronger: under the new net-billing tariff, roughly 60%
of new residential systems are now being paired with storage, compared to 1014% under prior net-metering rules. (Utility Dive)
Nationally, the residential storage market is scaling quicklyWood Mackenzie reports ~458 MW added in Q1 2025 alone, the strongest
first quarter on record. (Wood Mackenzie)
****
**Commercial and Industrial
Expansion.** Beyond residential applications, the market for C&I storage is emerging as a new growth segment. Businesses are increasingly
seeking solutions for demand-charge management, backup power, and grid services. To address this demand, we recently announced a 250 kW
/ 430 kWh C&I battery energy storage system, positioning NeoVolta to participate directly in this next stage of adoption.
****
**Financing and Distribution.**
The importance of financing structures has grown significantly across all customer segments. As system costs increase and federal incentives
such as the Investment Tax Credit (ITC) phase down under the One Big Beautiful Bill Act (scheduled to sunset by December
31, 2025), adoption is expected to depend increasingly on third-party ownership, leasing, and loan-based models. These financing options
reduce upfront costs and align payments with monthly utility savings, broadening access to storage. At the same time, NeoVolta is evolving
its channel strategy: while we initially sold primarily to independent installers, we are now leveraging regional and national distributors
to expand reach, improve logistics, and scale efficiently across multiple geographies.
****
**Policy and Resiliency Drivers.**Federal and state policy incentives continue to support adoption, including the ITC, though subject to phase-outs after 2025. Several
states, led by California and Hawaii, have adopted building codes and interconnection requirements that mandate or encourage storage.
Utilities are increasingly turning to rate reform, such as Californias net-billing tariff, which improves the economics of pairing
solar with batteries. Meanwhile, grid reliability concernsincluding widespread Public Safety Power Shutoff events in Californiacontinue
to highlight the resiliency benefits of energy storage for both homeowners and businesses.
We believe that these combined
factorsretrofit opportunity, rising attachment in new installations, growth into C&I, expanding financing and distribution
channels, and favorable regulatory and resiliency driverscreate a substantial and growing market opportunity for NeoVolta.
| | 4 | | |
**Growth Strategy**
With the addition of Ardes
Johnson to NeoVoltas management team as our CEO in April 2024, we adopted a refreshed growth strategy designed to expand our market
penetration, diversify revenue channels, and accelerate product development. This strategy rests on three primary objectives: (i) expanding
revenue through strategic sales channel development, (ii) broadening financing options through partnerships, and (iii) initiating development
of next-generation storage solutions.
**Sales Channel Expansion.**We have built a national sales team targeting key renewable energy distribution centers and regional installers. While NeoVolta initially
focused on direct sales to small, independent installers, we are now leveraging regional and national distributors to extend reach and
support scalability. Distributors improve logistics, expand product availability, and position us to penetrate high-growth markets such
as Texas, Florida, Hawaii, and Puerto Rico.
****
**Financing Partnerships**.
We are developing financing solutions that align with the evolving market. As federal incentives phase down under the One Big Beautiful
Bill Act (scheduled to sunset by December 31, 2025), adoption is expected to rely increasingly on third-party ownership, leasing, and
loan-based models. By working with financing partners, we intend to make our products more accessible and affordable to homeowners and
small businesses, supporting continued adoption despite changing incentive structures.
****
**Product Innovation.**
We are investing in research and development to expand our product portfolio and maintain a competitive edge. In addition to our core
NV14, NV24, NVPlus, and NV7600 inverter, we recently announced two major product launches: (i) a 250 kW / 430 kWh commercial and industrial
battery energy storage system, and (ii) the NV16 kW AC hybrid inverter with 24 kW PV input. These launches expand our reach into larger
residential and commercial markets. We have also begun advanced discussions with technology partners to develop future generations of
NeoVolta storage systems.
****
**Commercial Market Entry.**
We are positioning NeoVolta to compete in the emerging commercial and industrial (C&I) segment, where businesses are
seeking solutions for resiliency, demand-charge management, and grid services. Our newly introduced 250 kW / 430 kWh C&I product is
the first step in this expansion.
****
**Strategic Combinations.**
In addition to organic growth, we may evaluate acquisitions, joint ventures, or other strategic transactions to expand our technology
base, accelerate market entry, and enhance financing capabilities.
We believe this growth strategydriven
by expanded distribution, financing innovation, product development, and C&I expansionwill allow NeoVolta to scale efficiently
and strengthen our competitive position in the growing energy storage market.
| | 5 | | |
**Competition**
We compete with several established
companies in the energy storage systems (ESS) market, including Tesla, LG Chem, Sonnen, Enphase, SunPower, and SMA America.
Many of these competitors have significantly greater financial resources, manufacturing capacity, brand recognition, and established distribution
channels. Their scale allows them to pursue aggressive pricing, broader marketing, and faster product refresh cycles.
In addition to dedicated ESS
providers, we also face competition from diversified industrial companies, generator manufacturers, inverter suppliers, and other firms
that offer alternative backup power or distributed energy solutions. We expect new entrants to continue to emerge as energy storage adoption
expands and regulatory requirements evolve.
Despite the presence of larger
and more established competitors, we believe NeoVolta maintains distinct competitive advantages:
**Product Availability.**
We generally fulfill orders in less than two weeks, often within days, compared to extended backlogs reported by some competitors. This
supports the cash-flow needs of small and mid-sized installers.
**Installer Service.**
Our Certified Installer Program, direct technical support, and remote monitoring capabilities provide education and assistance to installers,
fostering loyalty and reducing installation risk.
**Product Safety and Flexibility.**
Our systems use lithium iron phosphate (LiFePO) chemistry and are UL 9540/9540A certified with no thermal runaway risk. Products
are NEMA 3R rated for indoor/outdoor use, support both AC- and DC-coupled solar, and allow capacity expansion without requiring an additional
inverter.
**Market Focus.** Unlike
some competitors that sell storage primarily as an add-on to solar, NeoVolta is focused entirely on energy storage. We target independent
installers and distributors that are underserved by larger providers, particularly in retrofit markets and emerging commercial segments.
We believe these differentiators
allow us to compete effectively in a rapidly growing market, even against larger, more established participants.
**Intellectual Property & Product Development**
We rely on a combination of
patents, trademarks, copyrights, trade secrets, and contractual protections to safeguard our technology and brand. As of September 2025,
we hold three issued U.S. utility patents:
|
| U.S. Patent No. 10,998,730 B1 directed
to NeoVoltas solar power inverter system. | |
|
| U.S. Patent No. 11,502,618 B2 directed
to NeoVoltas generators. | |
|
| U.S. Patent No. 11,605,952 B1 an expansion
of our inverter system patent. | |
We expect to continue filing
for patent protection when appropriate as we expand our technology portfolio.
In addition to patents, we protect our intellectual
property through nondisclosure agreements, confidentiality provisions, and invention assignment agreements with employees, consultants,
and advisors. Despite these protections, unauthorized parties may attempt to copy aspects of our products or use information we consider
proprietary. The success of our business depends in part on our ability to defend against misappropriation and infringement.
*Product Development*.
We continue to invest in research and development to expand our product offerings. In addition to our core NV14 and NV24 ESS products,
we have launched NVPlus, a higher-capacity residential and small commercial system; the NV7600 stand-alone inverter; and two new products
in 2025: (i) a 250 kW / 430 kWh commercial and industrial BESS, and (ii) the NV16 kW AC hybrid inverter with 24 kW PV input. We are also
exploring partnerships to accelerate development of next-generation systems.
| | 6 | | |
**Regulatory Environment**
The energy storage industry
is subject to a complex and evolving regulatory framework at the federal, state, and local levels. In recent years, regulators have adopted
new safety, interconnection, and performance standards that materially impact product design and installation requirements.
California and Hawaii have
been at the forefront of these regulatory changes. In California, the California Public Utilities Commission (CPUC) has
implemented standards such as the Common Smart Inverter Profile (CSIP) and Rule 21 interconnection requirements. On August
5, 2020, the California Energy Commission (CEC) approved NeoVoltas CSIP compliance application, enabling our products
to meet CPUC interconnection rules. In addition, rapid shutdown requirementsmandating that emergency responders be
able to quickly disable PV systems at the service panelwere adopted in 2021 and are now reflected in the National Electrical Code.
Fire code and safety standards
have also advanced significantly. Beginning in 2022, California prohibited installation of energy storage systems in residential living
spaces, limited installation in garages to units with fire protection measures, and required additional safeguards such as heat and smoke
detectors or bollards. These changes reflect increasing scrutiny of certain lithium-ion chemistries that have demonstrated thermal runaway
risks. NeoVoltas lithium iron phosphate (LiFePO) batteries, by contrast, have been certified under UL 9540A testing, which
evaluates thermal runaway and fire propagation, and meet current safety requirements.
NeoVoltas products
are certified under multiple safety and performance standards, including:
|
| UL 9540 and UL 9540A (energy storage system safety
and thermal runaway testing) | |
|
| UL 1741SA / SB and IEEE 1547 (inverter and grid
interconnection) | |
|
| UL 1973 (battery modules) | |
|
| FCC Class B (communications compliance) | |
|
| NFPA 70 National Electrical Code (2023 edition) | |
|
| California Rule 21 and Hawaii Electric SRD-UL-1741-SA-V1.1
(interconnection requirements) | |
|
| NEMA 3R (outdoor enclosure rating) | |
We expect the regulatory
environment for ESS to remain highly dynamic. Although compliance requires continued investment in engineering and certification, we believe
these requirements create higher barriers to entry for new competitors and reinforce NeoVoltas positioning as a compliant and safety-focused
manufacturer.
**Manufacturing**
We manufacture our NV14 and
NV24 energy storage systems at our facility in Poway, California. These products are built under a made-to-order model, with minimal finished-goods
inventory and higher raw-materials inventory relative to projected sales to support delivery timelines. In April 2023, we amended our
master supply agreement and purchased bulk raw-materials inventory from our former contract manufacturer; on June 1, 2023, we assumed
direct responsibility for manufacturing NV14/NV24 systems and hired key personnel who previously supported those activities. In February
2025, we secured a larger Poway facility to accommodate growth in these product lines.
*Other NeoVolta products*including
NVPlus, the NV7600 stand-alone inverter, and newly announced offeringsare manufactured through qualified contract partners under
NeoVolta specifications. We manage supplier selection, production planning, and quality control, and we perform firmware configuration
and final acceptance testing as appropriate before shipment.
| | 7 | | |
Our manufacturing processes
emphasize traceability and compliance. For NV14/NV24, we track components from receipt through final build, recording serial numbers,
torque settings, and required test results prior to packaging. All units are released only after passing defined quality checkpoints.
For partner-manufactured products, we apply incoming inspection protocols aligned to our specifications and certifications.
We source critical components
from suppliers in the United States and Asia. To mitigate risks from supply chain disruptions, tariffs, or component shortages, we maintain
buffer stocks of key NV14/NV24 components, pursue multi-sourcing arrangements, and coordinate production schedules with our partners.
In addition, we are actively working to increase domestic content across our products and to ensure that our supply chain is compliant
with Foreign Entity of Concern (FEOC) requirements, which will become increasingly important for eligibility under federal incentive programs.
**Employees**
As of June 30, 2025, we had
17 full-time employees. Our Chief Executive Officer oversees overall company strategy, sales, and product development, while our Chief
Financial Officer manages finance and administration. Our Poway facility staff is primarily focused on manufacturing and quality control
for our NV14 and NV24 systems, supported by supply chain, technical support, and sales and marketing personnel.
We also engage outside consultants
and contractors for specialized functions, including research and development, regulatory compliance, and market development. From time
to time, we may enter into specific contracts for non-recurring projects to supplement our workforce.
We consider our relationship
with employees to be good. None of our employees are represented by a labor union, and we have not experienced any work stoppages.
**Access to Information**
Our website is at www.neovolta.com.
We make available, free of charge, on our corporate website, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports
on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended (the Exchange Act), as soon as reasonably practicable after they are electronically filed with the Securities
and Exchange Commission (SEC). The SEC maintains an internet site that contains reports, proxy and information statements and other information
regarding issuers that file electronically with the SEC at www.sec.gov. Information contained on our website does not, and shall not be
deemed to, constitute part of this Annual Report on Form 10-K. Our reference to the URL for our website is intended to be an inactive
textual reference only.
| | 8 | | |
ITEM 1A. RISK FACTORS
**
The
following risks and uncertainties should be carefully considered in addition to the other information included in this Report. If any
of the following conditions or other unknown conditions should occur, our business, financial condition or operating results could be
materially harmed. An investment in our securities is speculative in nature, involves a high degree of risk and should not be made by
an investor who cannot bear the economic risk of its investment for an indefinite period of time and who cannot afford the loss of its
entire investment.
**Risks Related to our Business and Industry**
**We are a relatively new company, with our
sales having only commenced in July 2019, and we continue to have some of the risks associated with start-up ventures.**
We formed our corporation
in 2018. Since formation, we have focused on research, development and certification of our first energy storage system. We began marketing,
sales, and installations via our certified installers in May 2019 (although no sales were completed in the year ended June 30, 2019).
We may never achieve commercial success with our energy storage systems. We have limited historical financial data upon which we may base
our projected revenue and operating expenses. Our relatively short operating history makes it difficult for potential investors to evaluate
our technology or prospective operations and business prospects. Accordingly, we continue to be subject to many of the risks inherent
in business development, financing, unexpected expenditures, and complications and delays that often occur in a new business. Investors
should evaluate an investment in us in light of the uncertainties encountered by developing companies in a competitive environment. There
can be no assurance that our efforts will be successful or that we will ultimately be able to attain profitability.
**We have a history of net losses and we are
uncertain about our future profitability.**
We have incurred significant
net losses since our inception. For the years ended June 30, 2025 and 2024, we have incurred net losses of $5.0 million and $2.3 million,
respectively. As of June 30, 2025, we had an accumulated deficit of $25.8 million. If our revenue grows more slowly than currently anticipated,
or if operating expenses are higher than expected, we may be unable to consistently achieve profitability, our financial condition will
suffer, and the value of our common stock could decline. Even if we are successful increasing our sales, we may incur losses in the foreseeable
future as we continue to develop and market our products. If sales revenue from any of our current products or any additional products
that we develop in the future is insufficient, or if our product development is delayed, we may be unable to achieve profitability and,
in the event we are unable to secure financing for prolonged periods of time, we may need to temporarily cease operations and, possibly,
shut them down altogether. Furthermore, even if we are able to achieve profitability, we may be unable to sustain or increase such profitability
on a quarterly or annual basis, which would adversely impact our financial condition and significantly reduce the value of our common
stock.
**We may experience in the future, delays
or other complications in the design, manufacture, launch and production ramp of our energy storage products which could harm our brand,
business, prospects, financial condition and operating results.**
We may encounter unanticipated
challenges, such as supply chain or logistics constraints, that lead to delays in producing and ramping our energy storage products. Any
significant delay or other complication in the production of our products or the development, manufacture, and production ramp of our
future products, including complications associated with expanding our production capacity and supply chain or obtaining or maintaining
regulatory approvals, and/or coronavirus impacts, could materially damage our brand, business, prospects, financial condition and operating
results.
| | 9 | | |
**We may be unable to meet our growing energy
storage production plans and delivery plans, any of which could harm our business and prospects.**
Our plans call for achieving
and sustaining significant increases in energy storage systems production and deliveries. Our ability to achieve these plans will depend
upon a number of factors, including our ability to utilize installed manufacturing capacity, achieve the planned production yield and
further increase capacity as planned while maintaining our desired quality levels and optimize design and production changes, and our
suppliers ability to support our needs. If we are unable to realize our plans, our brand, business, prospects, financial condition
and operating results could be materially damaged.
**We are dependent on our two main component
vendors for our suppliers of batteries, inverters and other raw materials and the inability of these single-source suppliers to deliver
necessary components of our products according to our schedule and at prices, quality levels and volumes acceptable to us, or our inability
to efficiently manage these components, could have a material adverse effect on our financial condition and operating results.**
Our products contain numerous
purchased parts which we source globally from direct suppliers, the majority of whom are currently single-source suppliers. Any significant
unanticipated demand would require us to procure additional components in a short amount of time. While we believe that we will be able
to secure additional or alternate sources of supply for most of our components in a relatively short time frame, there is no assurance
that we will be able to do so or develop our own replacements for certain highly customized components of our products. In addition, if
we are required to use alternative suppliers for certain critical components, we may need to have our products go through a re-certification
process with various regulatory bodies, which process may be lengthy. In such event, we would not be able to sell our products using these
new components until we received all required certifications.
If we encounter unexpected
difficulties with key suppliers such as our inverter or lithium-iron phosphate cell supplier, and if we are unable to fill these needs
from other suppliers, we could experience production delays and potential loss of access to important technology and parts for producing,
servicing and supporting our products. This limited, and in many cases single source, supply chain exposes us to multiple potential sources
of delivery failure or component shortages for the production of our products. The loss of any single or limited source supplier or the
disruption in the supply of components from these suppliers could lead to significant product design changes and delays in product deliveries
to our customers, which could hurt our relationships with our customers and result in negative publicity, damage to our brand and a material
and adverse effect on our business, prospects, financial condition and operating results.
**We may become subject to further tariff
increases that would apply to the two main raw material components of our products which are sourced from Asian suppliers.**
Presently, our two main raw
material components, batteries and inverters, are imported from different suppliers in China and, until recently, were subject to fairly
low tariff rates that had been in effect for several years. Beginning in April 2025, the Trump Administration implemented a significant
increase in tariff rates on all goods imported from China, although it was temporarily suspended for 90 days in April 2025 and the suspension
has recently been extended to early November 2025. Prior to the tariff escalation in April 2025, we had anticipated the likelihood of
facing such a tariff increase and began stockpiling our inventory of these two components. As a result, we do not anticipate having to
purchase a significant level of such components at post-tariff prices for the next several months.
In the event, however, that
such a mutual trade agreement is not reached between the parties within the next several months and we find it necessary to begin purchasing
a significant level of our inventory components from China at post-tariff prices, we would be faced with a decision as to whether we should
attempt to pass along such tariff increases to our customers through higher prices for our products or absorbing them internally, or some
combination of those two alternatives.
| | 10 | | |
**Changes in our supply chain may result in
increased cost. If we are unsuccessful in our efforts to control and reduce supplier costs, our operating results will suffer.**
There is no assurance that
our suppliers will ultimately be able to meet our cost, quality and volume needs, or do so at the times needed. Furthermore, as the scale
of our energy storage systems increase, we will need to accurately forecast, purchase, warehouse and transport to our manufacturing facilities
components at much higher volumes than we have experience with. If we are unable to accurately match the timing and quantities of component
purchases to our actual needs, or successfully implement automation, inventory management and other systems to accommodate the increased
complexity in our supply chain, we may incur unexpected production disruption, storage, transportation and write-off costs, which could
have a material adverse effect on our financial condition and operating results.
**We are currently selling two primary products
and if these products that we sell or install fail to perform as expected, our reputation could be harmed and our ability to develop,
market and sell our products and services could be harmed.**
If our energy products were
to contain defects in design and manufacture that cause them not to perform as expected or that require repair or take longer than expected
to become enabled or are legally restricted, our ability to develop, market and sell our products and services could be harmed. While
we intend to perform internal testing on the products we manufacture, as a start-up company we currently have no frame of reference by
which to evaluate detailed long-term quality, reliability, durability and performance characteristics of our battery packs, inverters,
and energy storage products. There can be no assurance that we will be able to detect and fix any defects in our products prior to their
sale to or installation for consumers. Any product defects, delays or legal restrictions on product features, or other failure of our
products to perform as expected could harm our reputation and result in delivery delays, product recalls, product liability claims, significant
warranty and other expenses, and could have a material adverse impact on our business, financial condition, operating results and prospects.
**We depend on a small number of wholesale
dealers for a significant portion of our revenues to date.**
Due to our limited operating
history, we depend on a relatively small number of wholesale dealers and installers in California and other states for our revenue. For
the fiscal year ended June 30, 2025, our two largest dealers accounted for approximately 41% and 23% of our total revenues, respectively.
For the fiscal year ended June 30, 2024, our two largest dealers accounted for approximately 20% and 14% of our total revenues, respectively.
As of June 30, 2025, our three largest dealers represented approximately 39%, 12% and 12% of our accounts receivable balance. Our limited
customer base and concentration could expose us to the risk of substantial losses if a single dominant customer stops purchasing, or significantly
reduces orders for, our products. Our ability to maintain close relationships with these top customers is essential to the growth and
profitability of our business. If we fail to sell our products to one or more of these top customers in any particular period, or if a
large customer purchases fewer of our products, defers orders or fails to place additional orders with us, or if we fail to develop additional
major customers, our revenue could decline, and our results of operations could be adversely affected.
****
**If we fail to scale our business operations
and otherwise manage future growth and adapt to new conditions effectively as we grow our company, we may not be able to produce, market,
sell and service our products successfully.**
Any failure to manage our
growth effectively could materially and adversely affect our business, prospects, operating results and financial condition. Our future
operating results depend to a large extent on our ability to manage our expansion and growth successfully. We may not be successful in
undertaking this expansion if we are unable to control expenses and avoid cost overruns and other unexpected operating costs; adapt our
products and conduct our operations to meet local requirements; implement the required infrastructure, systems and processes; and find
and hire the right skills to make our growth successful.
| | 11 | | |
**If we are unable to achieve our targeted
manufacturing costs for our energy storage products our financial condition and operating results will suffer.**
As a relatively new company,
we have limited historical data that ensures our targeted manufacturing costs will be achievable. While we expect in the future to better
understand and control our manufacturing costs, there is no guarantee we will be able to achieve sufficient cost savings to reach our
gross margin and profitability goals. We may also incur substantial costs or cost overruns in utilizing and increasing the production
capability of our energy storage system facilities.
If we are unable to achieve
production cost targets on our products pursuant to our plans, we may not be able to meet our gross margin and other financial targets.
Many of the factors that impact on our manufacturing costs are beyond our control, such as potential increases in the costs of our materials
and components, such as lithium iron phosphate, nickel and other components of our battery cells. If we are unable to continue to control
and reduce our manufacturing costs, our operating results, business and prospects will be harmed.
**Increases in costs, disruption of supply
or shortage of materials, in particular for inverters and lithium iron phosphate cells, could harm our business.**
We may experience increases
in the cost or a sustained interruption in the supply or shortage of materials. Any such increase, supply interruption or shortage could
materially and negatively impact on our business, prospects, financial condition and operating results. We use various materials in our
business, including inverters and lithium iron phosphate cells, from suppliers.
The prices for these materials
fluctuate, and their available supply may be unstable, depending on market conditions and global demand for these materials, including
as a result of increased production of energy storage products by our competitors, and could adversely affect our business and operating
results. For instance, we are exposed to multiple risks relating to inverters and lithium iron phosphate cells.
These risks include:
|
| an increase in the cost, or decrease in the available supply, of materials used; | |
|
| disruption in the supply of cells due to quality issues or recalls by manufacturers; | |
|
| tariffs on the materials we source in China, which make up a significant amount of the materials we require; | |
|
| fluctuations in the value of the Chinese Renminbi against the U.S. dollar as our purchases for energy
storage products are denominated in Chinese Renminbi.; and | |
|
| potential increases in global shipping costs. | |
Our business is dependent
on the continued supply of inverters and battery cells for the battery packs used in our energy storage products. Any disruption in the
supply of inverters or battery cells could disrupt production of our battery packs we require for our energy storage product. Substantial
increases in the prices for our materials or prices charged to us would increase our operating costs, and could reduce our margins if
we cannot recoup the increased costs through increased prices. Any attempts to increase prices in response to increased material costs
could result in cancellations of energy storage orders and therefore materially and adversely affect our brand, image, business, prospects
and operating results.
**Continued high mortgage interest rates may
result in a decrease in demand by homeowners for our residential energy storage systems.**
Sales volume in our homeowner
channel is partially dependent on the construction of new homes and the sale of existing homes in our residential markets. Many customers
of our installation partners rely on mortgage loans from banks and other lenders in order to finance a substantial portion of the purchase
price for their home, including any related improvements. Increased mortgage interest rates may lead to lower demand for new homes and
a reduced number of homes available for solar origination through our homeowner channel. Additionally, increased interest rates may result
in fewer secondary home sales, a reduction in the number of customers refinancing their mortgages and uncertainty about the economy.
| | 12 | | |
**We are currently operating in a period of
economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing
military conflicts between Russia and Ukraine and between Gaza and Israel. Our business, financial condition and results of operations
may be materially and adversely affected by any negative impact on the global economy and capital markets resulting from these conflicts
or any other geopolitical tensions.**
U.S. and global markets are
experiencing volatility and disruption following the escalation of geopolitical tensions and the military conflicts between Russia and
Ukraine, which began in February 2022, and between Gaza and Israel, which began in October 2023. Although the length and impact of these
ongoing military conflicts are highly unpredictable, they could lead to further market disruptions, including significant volatility in
commodity prices, credit and capital markets, as well as supply chain interruptions. We are continuing to monitor the situations in both
of these areas and globally and assessing any potential impacts on our business.
Any of the above mentioned
factors could affect our business, prospects, financial condition, and operating results. The extent and duration of the military actions,
sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify
the impact of other risks described in this report.
**We may become subject to product liability
claims, which could harm our financial condition and liquidity if we are not able to successfully defend or insure against such claims.**
Although we believe we have
designed our products for safety, product liability claims, even those without merit, could harm our business, prospects, operating results
and financial condition. Our risks in this area are particularly pronounced given that we have only recently begun to deliver energy storage
products. Moreover, a product liability claim could generate substantial negative publicity about our products and business and could
have material adverse effect on our brand, business, prospects and operating results.
**The markets in which we operate are in their
infancy and highly competitive, and we may not be successful in competing in these industries as the industry further develops. We currently
face competition from new and established domestic and international competitors and expect to face competition from others in the future,
including competition from companies with new technology.**
The worldwide energy storage
market is in its infancy, and we expect it will become more competitive in the future. We also expect more regulatory burden as customers
adopt this new technology. There is no assurance that our energy storage systems will be successful in the respective markets in which
they compete. A significant and growing number of established and new companies, as well as other companies, have entered or are reported
to have plans to enter the energy storage market. Most of our current and potential competitors have significantly greater financial,
technical, manufacturing, marketing, sales networks and other resources than we do and may be able to devote greater resources to the
design, development, manufacturing, distribution, promotion, sale and support of their products. Increased competition could result in
lower unit sales, price reductions, revenue shortfalls, loss of customers and loss of market share, which could harm our business, prospects,
financial condition and operating results. The energy storage industry is highly competitive.
We face competition from other
manufacturers, developers and installers of energy storage systems, as well as from large utilities. Decreases in the retail prices of
electricity from utilities or other renewable energy sources could make our products less attractive to customers. Reduction in various
federal and state rebate and incentive programs could also adversely affect product adoption.
| | 13 | | |
**Our products and services are subject to
substantial regulations, which are evolving, and unfavorable changes or failures by us to comply with these regulations could substantially
harm our business and operating results.**
As a manufacturer of energy
storage systems, we are impacted by federal, state and local regulations and policies concerning electricity pricing, the interconnection
of electricity generation and storage equipment with the electric grid, and the sale of electricity generated by third-party owned systems.
For example, existing or proposed regulations and policies would permit utilities to limit the amount of electricity generated by our
customers with their solar energy systems, adjust electricity rate designs such that the price of our products may not be competitive
with that of electricity from the grid, restrict us and our customers qualifying for government incentives and benefits that apply to
renewable energy, and limit or eliminate net energy metering. If such regulations and policies remain in effect or are adopted in other
jurisdictions, or if other regulations and policies that adversely impact the interconnection or use of our energy storage systems are
introduced, they could deter potential customers from purchasing our energy storage products, which could harm our business, prospects,
financial condition and results of operations.
**Our business and
operations would suffer in the event of third-party computer system failures, cyber-attacks on third-party systems or deficiency in our
cyber security.**
We
rely on information technology (IT) systems, including third-party cloud based service providers, to keep
financial records, maintain product support data, and corporate records, to communicate with staff and external parties and to operate
other critical functions. This includes critical systems such as email, other communication tools, electronic document repositories and
archives. If any of these third-party information technology providers experience security breaches or incidents due to computer viruses,
unauthorized access, malware, ransomware, natural disasters, fire, terrorism, war, telecommunication failures, electrical failures, cyber-attacks
or cyber-intrusions over the internet, then sensitive data, including personal information, trade secrets, and confidential business information
could be compromised, exposed, or deleted. Similarly, we could incur business disruption if our access to the internet is compromised,
and we are unable to connect with third-party IT providers. The risk of a security breach or disruption, particularly through cyber-attacks
or cyber intrusion, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity
and sophistication of attempted attacks and intrusions from around the world have increased. To the extent that any disruption or security
breach results in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information,
we could incur liability and delay of our product development and support efforts.
**We may need to assert intellectual property-related
claims or defend ourselves against intellectual property infringement claims, which may be time-consuming and could cause us to incur
substantial costs.**
Others, including our competitors,
may hold or obtain patents, copyrights, trademarks or other proprietary rights that could prevent, limit or interfere with our ability
to make, use, develop, sell or market our products and services, which could make it more difficult for us to operate our business. From
time to time, the holders of such intellectual property rights may assert their rights and urge us to take licenses, and/or may bring
suits alleging infringement or misappropriation of such rights. We may consider the entering into licensing agreements with respect to
such rights, although no assurance can be given that such licenses can be obtained on acceptable terms or that litigation will not occur,
and such licenses could significantly increase our operating expenses. In addition, if we are determined to have infringed upon a third
partys intellectual property rights, we may be required to cease making, selling or incorporating certain components or intellectual
property into the goods and services we offer, to pay substantial damages and/or license royalties, to redesign our products and services,
and/or to establish and maintain alternative branding for our products and services. In the event that we were required to take one or
more such actions, our business, prospects, operating results and financial condition could be materially adversely affected. In addition,
any litigation or claims, whether or not valid, could result in substantial costs, negative publicity and diversion of resources and management
attention.
In August 2021, we entered
into an exclusive long term supply agreement with our Asian supplier pertaining to our inverter component. This agreement contains provisions
that address the ownership and use of intellectual property rights. While we are unaware of any present dispute concerning this agreement
or our other agreements that concern ownership of or use of intellectual property rights, future disputes may arise concerning this or
other agreements we have entered into that concern ownership of or use of intellectual property rights.
| | 14 | | |
**Our business could be negatively impacted
if we fail to adequately protect our intellectual property rights.**
We consider our intellectual
property rights to be important assets, and seek to protect them through a combination of patent, trademark, copyright and trade secret
laws, as well as licensing and confidentiality agreements. These protections may not be adequate to prevent third parties from using our
intellectual property without our authorization, breaching any confidentiality agreements with us, copying or reverse engineering our
products, or developing and marketing products that are substantially equivalent to or superior to our own. The unauthorized use of our
intellectual property by others could reduce our competitive advantage and harm our business. Not only are intellectual property-related
proceedings burdensome and costly, but they could span years to resolve and we might not ultimately prevail. We cannot guarantee that
any patents, issued or pending, will provide us with any competitive advantage or will not be challenged by third parties. Moreover, the
expiration of our patents may lead to increased competition with respect to certain products.
****
**Our industry is subject to technological
change, and our failure to continue developing new and improved products and to bring these products rapidly to market could have an adverse
impact on our business.**
New products, or refinements
and improvements to our existing products, may have technical failures, delayed introductions, higher than expected production costs or
may not be well accepted by our customers. If we are not able to anticipate, identify, develop and market high quality products in line
with technological advancements that respond to changes in customer preferences, demand for our products could decline and our operating
results could be adversely affected.
**Public company compliance may make it more
difficult to attract and retain officers and directors.**
The Sarbanes-Oxley Act and
rules subsequently implemented by the SEC have required changes in corporate governance practices of public companies. As a public company,
we expect that these rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance
in the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same
or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our Board of Directors
or as executive officers.
**Confidentiality agreements with employees
and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information, and our inability to maintain
the confidentiality of that information, due to unauthorized disclosure or use, or other event, could have a material adverse effect on
our business.**
In addition to the protection
afforded by patents, we seek to rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is
not patentable or that we elect not to patent, processes for which patents are difficult to enforce, and any other elements of our product
discovery and development processes that involve proprietary know-how, information, or technology that is not covered by patents. Trade
secrets, however, may be difficult to protect. We seek to protect our proprietary processes, in part, by entering into confidentiality
agreements with our employees, consultants, advisors, contractors and collaborators. Although we use reasonable efforts to protect our
trade secrets, our employees, consultants, advisors, contractors, and collaborators might intentionally or inadvertently disclose our
trade secret information to competitors. In addition, competitors may otherwise gain access to our trade secrets or independently develop
substantially equivalent information and techniques. Furthermore, the laws of some foreign countries do not protect proprietary rights
to the same extent or in the same manner as the laws of the United States. As a result, we may encounter significant problems in protecting
and defending our intellectual property both in the United States and abroad. If we are unable to prevent unauthorized material disclosure
of our intellectual property to third parties, or misappropriation of our intellectual property by third parties, we will not be able
to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, operating results
and financial condition.
**We are heavily reliant on the services of
both Ardes Johnson, our Chief Executive Officer, and Steve Bond, our Chief Financial Officer, and the departure or loss of either officer
could disrupt our business.**
We depend heavily on the continued
efforts of Ardes Johnson, our Chief Executive Officer, and Steve Bond, our Chief Financial Officer**,** who are essential to
our strategic vision and day-to-day operations and would be difficult to replace. The departure or loss of either Mr. Johnson or Mr. Bond,
or the inability to timely hire and retain qualified replacements, could negatively impact our ability to manage our business.
| | 15 | | |
**If we are unable to recruit and retain key
management, technical and sales personnel, our business would be negatively affected.**
For our business to be successful,
we need to attract and retain highly qualified technical, management and sales personnel. The failure to recruit additional key personnel
when needed with specific qualifications and on acceptable terms or to retain good relationships with our partners might impede our ability
to continue to develop, commercialize and sell our products. To the extent the demand for skilled personnel exceeds supply, we could experience
higher labor, recruiting and training costs in order to attract and retain such employees. We face competition for qualified personnel
from other companies with significantly more resources available to them and thus may not be able to attract the level of personnel needed
for our business to succeed.
**Artificial intelligence presents risks and
challenges that can impact our business, including by posing security risks to our confidential information, proprietary information and
personal data.**
Issues in the development
and use of artificial intelligence, combined with an uncertain regulatory environment, may result in reputational harm, liability, or
other adverse consequences to our business operations. As with many technological innovations, artificial intelligence presents risks
and challenges that could impact our business. We may adopt and integrate generative artificial intelligence tools into our systems for
specific use cases. Our vendors may incorporate generative artificial intelligence tools into their offerings without disclosing this
use to us, and the providers of these generative artificial intelligence tools may not meet existing or rapidly evolving regulatory or
industry standards with respect to privacy and data protection and may inhibit our or our vendors ability to maintain an adequate
level of service and experience. If we, our vendors, or our third-party partners experience an actual or perceived breach or privacy or
security incident because of the use of generative artificial intelligence, we may lose valuable intellectual property and confidential
information and our reputation and the public perception of the effectiveness of our security measures could be harmed. Further, bad actors
around the world use increasingly sophisticated methods, including the use of artificial intelligence, to engage in illegal activities
involving the theft and misuse of personal information, confidential information, and intellectual property. Any of these outcomes could
damage our reputation, result in the loss of valuable property and information, and adversely impact our business.
**Risks Related to Our Securities**
**Nevada law and provisions in our articles
of incorporation and bylaws could make a takeover proposal more difficult.**
We are a Nevada corporation
and the anti-takeover provisions of the Nevada Revised Statutes may discourage, delay or prevent a change in control by prohibiting us
from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested
stockholder, even if a change in control would be beneficial to our existing stockholders. In addition, our articles of incorporation
and bylaws may discourage, delay or prevent a change in our management or control over us that stockholders may consider favorable. Our
articles of incorporation and bylaws:
|
| authorize the issuance of blank check preferred stock that could be issued by our board
of directors to thwart a takeover attempt; | |
|
| place restrictive requirements (including advance notification of stockholder nominations and proposals)
on how special meetings of stockholders may be called by our stockholders; do not provide stockholders with the ability to cumulate their
votes; and | |
|
| provide that our board of directors may amend our bylaws. | |
Additionally, our authorized
capital includes preferred stock issuable in one or more series. Our board has the authority to issue preferred stock and determine the
price, designation, rights, preferences, privileges, restrictions and conditions, including voting and dividend rights, of those shares
without any further vote or action by stockholders. The rights of the holders of common stock will be subject to, and may be adversely
affected by, the rights of holders of any preferred stock that may be issued in the future. The issuance of additional preferred stock,
while providing desirable flexibility in connection with possible financings and acquisitions and other corporate purposes, could make
it more difficult for a third party to acquire a majority of the voting power of our outstanding voting securities, which could deprive
our holders of common stock of a premium that they might otherwise realize in connection with a proposed acquisition of our company.
| | 16 | | |
**As an emerging growth company
under the Jumpstart Our Business Startups Act, or JOBS Act, we are permitted to, and intend to, rely on exemptions from certain disclosure
requirements.**
As an emerging growth
company under the JOBS Act, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. We are
an emerging growth company until the earliest of:
|
| the last day of the fiscal year during which we have total annual gross revenues of $1.235 billion or
more; | |
|
| the last day of the fiscal year following the fifth anniversary of our initial public offering; | |
|
| the date on which we have, during the previous 3-year period, issued more than $1 billion in non-convertible
debt; or | |
|
| the date on which we are deemed a large accelerated issuer as defined under the federal
securities laws. | |
For so long as we remain an
emerging growth company, we will not be required to:
|
| have an auditor report on our internal control over financial reporting pursuant to the Sarbanes-Oxley
Act of 2002; | |
|
| comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding
mandatory audit firm rotation or a supplement to the auditors report providing additional information about the audit and the financial
statements (auditor discussion and analysis); | |
|
| submit certain executive compensation matters to shareholders advisory votes pursuant to the say
on frequency and say on pay provisions (requiring a non-binding shareholder vote to approve compensation of certain
executive officers) and the say on golden parachute provisions (requiring a non-binding shareholder vote to approve golden
parachute arrangements for certain executive officers in connection with mergers and certain other business combinations) of the Dodd-Frank
Wall Street Reform and Consumer Protection Act of 2010; and | |
|
| include detailed compensation discussion and analysis in our filings under the Securities Exchange Act
of 1934, as amended, and instead may provide a reduced level of disclosure concerning executive compensation. | |
For so long as we remain an
emerging growth company, we:
|
| may present only two years of audited financial statements and only two years of related Managements
Discussion and Analysis of Financial Condition and Results of Operations, or MD and | |
|
| are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting
standards under 107 of the JOBS Act. | |
****
We intend to take advantage
of all of these reduced reporting requirements and exemptions.
Certain of these reduced reporting
requirements and exemptions were already available to us due to the fact that we also qualify as a smaller reporting company
under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation and report regarding managements
assessment of internal control over financial reporting; are not required to provide a compensation discussion and analysis; are not required
to provide a pay-for-performance graph or CEO pay ratio disclosure; and may present only two years of audited financial statements and
related MD&A disclosure.
We cannot predict if investors
will find our securities less attractive due to our reliance on these exemptions. If investors were to find our common stock less attractive
as a result of our election, we may have difficulty raising additional capital.
| | 17 | | |
**Our shareholders may experience dilution
of their ownership interests because of the future issuance of additional shares of our common or preferred stock or other securities
that are convertible into or exercisable for our common or preferred stock.**
We are authorized to issue an aggregate of 100,000,000
shares of common stock and 5,000,000 shares of blank check preferred stock. In the future, we may issue our authorized but
previously unissued equity securities, resulting in the dilution of the ownership interests of our present stockholders.
We intend to seek to raise
additional funds, finance acquisitions or develop strategic relationships by issuing equity or convertible debt securities, which would
reduce the percentage ownership of our existing stockholders. Our board of directors has the authority, without action or vote of the
stockholders, to issue all or any part of our authorized but unissued shares of common or preferred stock. Our articles of incorporation
authorizes us to issue up to 100,000,000 shares of common stock and 5,000,000 shares of preferred stock. Future issuances of common or
preferred stock would reduce our stockholders influence over matters on which stockholders vote and would be dilutive to earnings per
share. In addition, any newly issued preferred stock could have rights, preferences and privileges senior to those of the common stock.
Those rights, preferences and privileges could include, among other things, the establishment of dividends that must be paid prior to
declaring or paying dividends or other distributions to holders of our common stock or providing for preferential liquidation rights.
These rights, preferences and privileges could negatively affect the rights of holders of our common stock, and the right to convert such
preferred stock into shares of our common stock at a rate or price that would have a dilutive effect on the outstanding shares of our
common stock.
**We do not anticipate paying dividends on
our common stock, and investors may lose the entire amount of their investment.**
Cash dividends have never
been declared or paid on our common stock, and we do not anticipate such a declaration or payment for the foreseeable future. We expect
to use future earnings, if any, to fund business growth. Therefore, stockholders will not receive any funds absent a sale of their shares
of common stock. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur
if our stock price appreciates. We cannot assure stockholders of a positive return on their investment when they sell their shares, nor
can we assure that stockholders will not lose the entire amount of their investment.
****
**The Warrants we issued in our July 2022
offering are speculative in nature, and the trading market for our Warrants are volatile, sporadic and limited.**
The Warrants we issued in
our July 2022 offering do not confer any rights of common stock ownership on their holders, such as voting rights or the right to receive
dividends, but rather merely represent the right to acquire shares of our common stock at a fixed price for a limited period of time.
Specifically, commencing on the date of issuance, holders of the Warrants may exercise their right to acquire the common stock and pay
an exercise price of $4.00 per share, up to five years from the date of issuance, after which date any unexercised Warrants will expire
and have no further value. In addition, the trading market for the Warrants is volatile, sporadic and limited.
**Holders of the Warrants we issued in our
July 2022 offering will have no rights as a common stockholder until they acquire our common stock**.
Until holders of the Warrants
we issued in our July 2022 offering acquire shares of our common stock upon exercise of the Warrants, the holders will have no rights
with respect to shares of our common stock issuable upon exercise of the Warrants. Upon exercise of the Warrants, the holder will be entitled
to exercise the rights of a common stockholder as to the security exercised only as to matters for which the record date occurs after
the exercise.
| | 18 | | |
**Although our securities became listed on
Nasdaq in August 2022, there can be no assurance that we will be able to comply with the continued listing standards of Nasdaq, a failure
of which could result in a de-listing of our common stock**.
The Nasdaq Capital Market
requires that the trading price of its listed stocks remain above one dollar in order for the stock to remain listed. If a listed stock
trades below one dollar for more than 30 consecutive trading days, then it is subject to delisting from Nasdaq. In addition, to maintain
a listing on Nasdaq, we must satisfy minimum financial and other continued listing requirements and standards, including those regarding
director independence and independent committee requirements, minimum stockholders equity, and certain corporate governance requirements.
Additionally, we may become subject to an evolving set of compliance regulations pertaining to environmental, social and governance (ESG)
matters as well as cybersecurity standards that are promulgated by Nasdaq or other regulatory bodies. If we are able to maintain the listing
of our securities on Nasdaq, we may be unable to satisfy these requirements or standards and we could subject our securities to delisting,
which would have a negative effect on the price of our common stock and would impair our security holders ability to sell or purchase
our common stock or Warrants when they wish to do so. In the event of a delisting, we would expect to take actions to restore our compliance
with the listing requirements, but we can provide no assurance that any such action taken by us would allow our securities to become listed
again, stabilize the market price or improve the liquidity of our securities, prevent our securities from dropping below the minimum bid
price requirement, or prevent future non-compliance with the listing requirements.
**The price of our common stock and Warrants
may be volatile.**
The market price of our common
stock and Warrants is highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our
control, including the following:
|
| changes in our industry; | |
|
| competitive pricing pressures; | |
|
| our ability to obtain working capital financing; | |
|
| additions or departures of key personnel; | |
|
| conversions from preferred stock to common stock; | |
|
| sales of our common and preferred stock; | |
|
| our ability to execute our business plan; | |
|
| operating results that fall below expectations; | |
|
| loss of any strategic relationship; | |
|
| regulatory developments; and | |
|
| economic and other external factors. | |
In addition, the securities markets have from
time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies.
These market fluctuations may also materially and adversely affect the market price of our common stock and Warrants.
**Negative research about our business published
by analysts or journalists could cause our stock price to decline. A lack of regularly published research about our business could cause
trading volume or our stock price to decline.**
The trading market for our
common stock depends in part on the research and reports that analysts and journalists publish about us or our business. If analysts or
journalists publish inaccurate or unfavorable research about our business, our stock price would likely decline. If we fail to meet the
expectations of analysts for our operating results, or if the analysts who covers us downgrade our stock, our stock price would likely
decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our stock could
decrease, which could cause our stock price and trading volume to decline.
| | 19 | | |
**Claims for indemnification by our directors
and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available
to us.**
Our articles of incorporation
and bylaws contain provisions that eliminate, to the maximum extent permitted by the corporation law of the State of Nevada, the personal
liability of our directors and executive officers for monetary damages for breach of their fiduciary duties as a director or officer.
Our articles of incorporation and bylaws also provide that we will indemnify our directors and executive officers and may indemnify our
employees and other agents to the fullest extent permitted by the corporation law of the State of Nevada. Any claims for indemnification
made by our directors or officers could impact our cash resources and our ability to fund the business.
**Shareholder activism could cause material
disruption to our business.**
Publicly traded companies
have increasingly become subject to campaigns by activist investors advocating corporate actions such as actions related to environment,
social and governance (ESG) matters, among other issues. Responding to proxy contests and other actions by such activist investors or
others in the future could be costly and time-consuming, disrupt our operations and divert the attention of our Board of Directors and
senior management from the pursuit of our business strategies, which could adversely affect our results of operations and financial condition.
****
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
ITEM 1C. CYBERSECURITY
**Risk Management and Strategy**
Due
to our small size, we have not established formal policies and procedures for assessing, identifying, and managing material risk from
cybersecurity threats. However, we monitor cybersecurity threats internally, including any potential unauthorized occurrence on or conducted
through our information systems that we use through third party providers that may result in adverse effects on the confidentiality, integrity,
or availability of our information systems or any information residing therein.
We
conduct annual risk assessments and perform as needed updates to our risks to identify cybersecurity threats, as well as assessments in
the event of a material change in our business practices that may affect information systems that are vulnerable to such cybersecurity
threats. We do not engage consultants,thirdparties and auditors in connection with our risk assessment processes.
As
of June 30, 2025, and through the date of the filing of this report, we are not aware of any cybersecurity incidents that have materially
affected or are reasonably likely to materially affect us, including our business strategy, results of operations or financial condition.
| | 20 | | |
**Governance**
One
of the key responsibilities of our board of directors is informed oversight of our risk management process, including risks from cybersecurity
threats. Our board of directors is responsible for monitoring and assessing strategic risk exposure, and our executive officers are responsible
for the day-to-day management of the material risks we face and are responsible for reporting to our board of directors any cybersecurity
incidents.
At
present, our three executive officers have no particular experience or training in cybersecurity matters. However, our Chief Financial
Officer has served as an executive officer for over ten years, including over five years as an executive officer of public companies.
Due to our small size, our board of directors has not designated any Board committee or any other subset of Board members to provide oversight
of our cybersecurity program as part of a periodic review of our overall risk management program.
ITEM 2. PROPERTIES
Commencing February 2025,
we moved into a new dedicated headquarters and manufacturing facility in Poway, California, just north of San Diego. This state-of-the-art,
energy-efficient facility has ample square footage, shipping and receiving space, and office spaces to support the companys growth
by increasing the production capability and shipping efficiency from that of our previous facility. The facility was secured under a sublease
agreement and replaced a similar facility that we shared with our former contract manufacturer from January 2021 through February 2025.
Upon the expiration of the prior sublease, we relocated our corporate and manufacturing office space to our current facility in the same
vicinity under a 13 month sublease agreement with the sublandlord, at a base rental of $18,638 per month.
We do not own any real property.
****
ITEM 3. LEGAL PROCEEDINGS
We are currently not a party
to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that we believe is not ordinary routine
litigation incidental to our business or otherwise material to the financial condition of our business.
****
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
| | 21 | | |
PART II
****
ITEM 5. MARKET FOR REGISTRANTS COMMON
EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
****
**Market Information**
Our common stock and Warrants
are listed on the NASDAQ Capital Market (Nasdaq) under the symbols NEOV and NEOVW, respectively.
**Holders**
As of September 29, 2025,
there were approximately 36 holders of record of our common stock. The number of record holders does not include beneficial owners of
common stock whose shares are held in the names of banks, brokers, nominees or other fiduciaries.
****
**Dividends**
We have never paid any cash
dividends on our common stock. We currently anticipate that we will retain all future earnings for use in our business. Consequently,
we do not anticipate paying any cash dividends in the foreseeable future. The payment of dividends in the future will depend upon our
results of operations, as well as our short term and long-term cash availability, working capital, working capital needs, and other factors
as determined by our Board of Directors.
**Recent Sales of Unregistered Securities**
In the three months ended
June 30, 2025, we issued no new shares of our common stock.
**Purchases of Equity Securities by the Issuer and Affiliated Purchasers**
We did not repurchase any of our equity securities
during the yearended June 30, 2025.
****
| | 22 | | |
ITEM 6. [RESERVED]
ITEM 7. MANAGEMENTS DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
*The following discussion
should be read in conjunction with the financial statements and notes thereto included elsewhere in this report. Certain statements in
this Managements Discussion and Analysis of Financial Condition and Results of Operations are forward-looking statements
that are based on current expectations and involve various risks and uncertainties that could cause our actual results to differ materially
from those expressed in these forward-looking statements. We encourage you to review the Cautionary Note Regarding Forward-Looking Statements and Risk Factors sections in this report.*
**Overview**
We are a designer, manufacturer,
and seller of high-end Energy Storage Systems (or ESS), primarily our NeoVolta NV14, NV14-K, and NV 24, which can store and use energy
via batteries and an inverter at residential or commercial sites. We were founded to identify new ways to leverage emerging technologies
with the dynamic changes that are taking place in the energy delivery space. We primarily market and sell our products directly to our
certified solar installers and solar equipment distributors. We are also pursuing agreements with residential developers, commercial developers,
and other commercial opportunities. Because we are purely dedicated to energy solar systems, virtually all of our current resources and
efforts go into further developing our flagship NV14 and NV 24 products, while focusing on specific industry needs for our next generation
of products. We believe we are unique in the marketplace due to our low cost, our innovative battery chemistry, our product versatility
and our commitment to installer service. Because of these factors, we believe NeoVolta is uniquely equipped to establish itself as a major
player in the energy storage market.
As further discussed below
under Liquidity and Capital Resources, we completed an underwritten public offering of our equity securities in the form
of Units in August 2022. We sold a total of 1,121,250 Units in the offering at an offering price to the public of $4.00 per Unit. The
gross proceeds of the offering were $4,485,000 and the net proceeds, after deduction of underwriting discounts and other offering costs,
were approximately $3,780,000. We are using the proceeds of this public offering to increase our current production capacity, expand our
product portfolio, enlarge our product marketing and sales efforts, and for other general corporate purposes.
**Results of Operations**
**Comparison of the Years
Ended June 30, 2025 and 2024**
*Revenues* - Revenues
from contracts with customers for the year ended June 30, 2025 were $8,426,835 compared to $2,645,072 for the year ended June 30, 2024.
Such increase in our revenues was primarily due to the rapid expansion of various new sales channels
outside of our traditional focus on the local installer market in the Southern California area since the engagement of our new chief executive
officer in April 2024. As a result, we achieved the highest level of annual sales in our history.
*Cost of Goods Sold*
- Cost of goods sold for the year ended June 30, 2025 were $6,920,130 compared to $2,134,725 for the year ended June 30, 2024. The cost
of goods sold in both periods reflected the cost of procuring and assembling the component parts of the energy storage systems that were
sold in each fiscal year and resulted in essentially comparable gross profits on such sales of approximately 18% and 19% in each year.
| | 23 | | |
**
*General and Administrative
Expense* - General and administrative expenses for the year ended June 30, 2025 were $6,065,590 compared to $2,828,147 for the year
ended June 30, 2024. Such increase was mainly due to our appointment of a new chief executive officer, who was engaged at an annual salary
of $350,000 and also received a 4 year amortizing equity award of $2,854,000, as well as the hiring of several other employees since April
2024. The addition of these personnel has resulted in a higher level of both cash compensation expense and other associated expenses,
such as marketing and travel, as well as non-cash stock compensation expenses related to the Companys equity incentive programs.
*Research and Development
Expense* - Research and development expenses for the year ended June 30, 2025 were $157,305 compared to $19,154 for the year ended
June 30, 2024. Such increase was largely due to a higher level of focus by our new chief executive officer on product development efforts.
*Other Income and Expense*
Interest expense for the year ended June 30, 2025 was $320,417 compared to zero for the year ended June 30, 2024, reflecting interest
attributable to borrowings made under our line of credit and another borrowing arrangement obtained since June 30, 2024. Interest income
for the year ended June 30, 2025 was $2,011 compared to $33,644 for the year ended June 30, 2024. This decrease was due to our lower level
of investable cash in the year ended June 30, 2025.
*Net Loss* - Net loss
for the year ended June 30, 2025 was $5,034,596 compared to $2,303,310 for the year ended June 30, 2024, representing the aggregate of
the various revenue and expense categories indicated above. We have not recognized any income tax benefit for these net losses due to
the uncertainty of our ultimate realization.
**Liquidity and Capital Resources**
*Operating activities*.
Net cash used in operating activities for the year ended June 30, 2025 was $4,425,752 compared to $1,016,362 for the year ended June 30,
2024. This increase was largely due to the current period increase in our comparative net loss, primarily resulting from an increase in
our previously noted cash operating expenses for personnel and related costs, as well as the relatively higher changes in our net working
capital needs, including recent stockpiling and prepayment of inventory, on a comparative basis.
*Financing activities.*
Net cash provided by financing activities for the year ended June 30, 2025 was $4,234,161 compared to zero for the year ended June 30,
2024. In February 2025, we completed a private equity offering under which we issued a total of 543,500 shares of our common stock to
investors at an offering price of $2.00 per share resulting in gross proceeds of $1,087,000. In September 2024, we entered into an agreement
with a newly formed financing entity whereby we obtained a line of credit for borrowings of up to $5,000,000. As of June 30, 2025, we
made net borrowings under this credit agreement in the total amount of $383,538 initially to fund a short-term loan that we made to a
customer in October 2024, in the amount of $250,000, which was fully repaid in December 2024. Beginning in November 2024, we made short-term
borrowings from another lender in the total amount of $5,106,343, of which a portion had been repaid, leaving an outstanding balance as
of June 30, 2025 of $2,603,223. While our increasing level of short-term borrowings from this lender have been made at a relatively high
borrowing cost in terms of interest rate and fees, we have been able to meet our rising funding needs in this period in large part due
to the timely responsiveness of this lender. In December 2024, we also received proceeds from the exercise of warrants issued in our August
2022 public offering in the amount of $160,400.
As of June 30, 2025, we had
a cash balance of approximately $0.8 million and net working capital of approximately $3.2 million. Currently, we are not generating a
break-even level of net operating cash flow from our net sales. However, we anticipate that demand for our products will ultimately increase
over time and that, with our current credit sources, we will have sufficient cash to operate for at least the next 12 months.
| | 24 | | |
**Other Developments**
We continue to monitor current
international developments occurring in Ukraine and Israel. However, we do not believe that they will have a significant impact on either
the domestic markets for our products or the international supply chains for our product components, which are largely sourced from Asia.
Presently, our two main raw
material components, batteries and inverters, are imported from different suppliers in China and, until recently, were subject to fairly
low tariff rates that had been in effect for several years. Beginning in April 2025, the new Trump Administration implemented a significant
increase in tariff rates on all goods imported from China, although it was temporarily suspended for 90 days in April 2025 and the suspension
has recently been extended to early November 2025. Prior to the tariff escalation in April 2025, we had anticipated the likelihood of
facing such a tariff increase and began stockpiling our inventory of these two components. As a result, we do not anticipate having to
purchase a significant level of such components at post-tariff prices for the next several months.
In the event, however, that
such a mutual trade agreement is not reached between the parties within the next several months and we find it necessary to begin purchasing
a significant level of our inventory components from China at post-tariff prices, we would be faced with a decision as to whether we should
attempt to pass along such tariff increases to our customers through higher prices for our products or absorbing them internally, or some
combination of those two alternatives. Either circumstance would likely materially adversely affect our sales and/or our profitability.
**Off-Balance Sheet Arrangements**
We have no obligations, assets
or liabilities which would be considered off-balance sheet arrangements as defined in Item 303 of Regulation S-K.
**Critical Accounting Policies**
The financial statements have
been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial
statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure
of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting
periods. Our estimates are based on our limited historical experience and on various other factors that we believe are reasonable under
the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are
not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
We believe that certain accounting
policies, particularly those related to the recognition of revenues arising from the sales of our ESS products to customers of our business,
could potentially affect our judgments and estimates used in the preparation of our financial statements. With regard to revenue recognition,
the Company recognizes revenue in accordance with Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts with Customers
(Topic 606), which was adopted on July 1, 2019 using the modified retrospective method, with no impact to the Companys comparative
financial statements. Revenues are recognized when control of the promised goods is transferred to the customer in an amount that reflects
the consideration the Company expects to be entitled to in exchange for transferring those goods or services. Revenue is recognized based
on the following five step model:
|
| Identification of the contract with a customer | |
|
| Identification of the performance obligations
in the contract | |
|
| Determination of the transaction price | |
|
| Allocation of the transaction price to the performance
obligations in the contract | |
|
| Recognition of revenue when, or as, the Company
satisfies a performance obligation | |
See Note 1. Business
and Summary of Significant Accounting Policies of the notes to our financial statements for the fiscal year ended June 30, 2025,
set forth below under, Index to Financial Statements, for a further description of our accounting policies and estimates.
None of those policies are deemed to be critical accounting policies nor critical accounting estimates. As reflected in Note 1, Management
has determined that the Company operates inonly onereportable segment, which is the development and commercialization of energy
storage products.
| | 25 | | |
**Emerging Growth Company and Smaller Reporting
Company Status**
We are an emerging growth
company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards
issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. We elected to use this
extended transition period for complying with new or revised accounting standards that have different effective dates for public and private
companies until the earlier of the date that we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt
out of the extended transition period provided in the JOBS Act. As a result, these financial statements may not be comparable to companies
that comply with the new or revised accounting pronouncements as of public company effective dates. We are using the extended transition
period for any other new or revised accounting standards during the period in which we remain an emerging growth company.
We will remain an emerging
growth company until the earliest of (i) the last day of our first fiscal year (a) following the fifth anniversary of the completion of
our August 2022 offering, (b) in which we have total annual gross revenues of at least $1.235 billion or (c) in which we are deemed to
be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700.0 million as
of the prior June 30th and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the
prior three-year period.
We are also a smaller
reporting company, meaning that the market value of our stock held by non-affiliates is less than $700.0 million and our annual
revenue is less than $100.0 million during the most recently completed fiscal year. We may continue to be a smaller reporting company
if either (i) the market value of our stock held by non-affiliates is less than $250.0 million or (ii) our annual revenue is less than
$100.0 million during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700.0
million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions
from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company we
may choose to present only the two most recent fiscal years of audited financial statements in our Annual Reports on Form 10-K and, similar
to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISKS
We are a smaller reporting
company as defined by Rule 12b-2 of the Exchange Act and are not required to provide information required under this item.
****
****
****
****
****
****
****
****
****
****
| | 26 | | |
****
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY
DATA
**NeoVolta Inc.**
**Index to Financial Statements**
|
|
|
| |
|
|
| |
|
|
Report of Independent Registered Public Accounting Firm (PCAOB ID# 206) |
28 | |
|
|
|
| |
|
|
Balance Sheets as of June 30, 2025 and 2024 |
29 | |
|
|
|
| |
|
|
Statements of Operations for the years ended June 30, 2025 and 2024 |
30 | |
|
|
|
| |
|
|
Statements of Stockholders Equity for the years ended June 30, 2025 and 2024 |
31 | |
|
|
|
| |
|
|
Statements of Cash Flows for the years ended June 30, 2025 and 2024 |
32 | |
|
|
|
| |
|
|
Notes to the Financial Statements |
33 | |
| | 27 | | |
****
**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM**
To the Shareholders and Board of Directors of
NeoVolta, Inc.
****
**Opinion on the Financial Statements**
****
We have audited the accompanying balance
sheets of NeoVolta, Inc. (the Company) as of June 30, 2025 and 2024, and the related statements of operations, stockholders
equity, and cash flows for the years then ended, and the related notes (collectively referred to as the financial statements).
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30,
2025 and 2024, 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 financial statements are the responsibility
of the Companys management. Our responsibility is to express an opinion on the Companys financial statements based on our
audits. 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 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. Accordingly, we express no such opinion.
Our audits included performing procedures
to assess the risks of material misstatement of the 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 financial statements. We believe that our audits provide a reasonable basis for our opinion
*/s/ MaloneBailey, LLP*
www.malonebailey.com
We have served as the Company's auditor
since 2018.
Houston, Texas
September 29, 2025
| | 28 | | |
**NEOVOLTA INC.**
**Balance Sheets**
|
| |
| | | |
| | | |
|
| |
June 30, | | |
June 30, | | |
|
| |
2025 | | |
2024 | | |
|
Assets | |
|
Current assets: | |
| | | |
| | | |
|
Cash and cash equivalents | |
$ | 794,836 | | |
$ | 986,427 | | |
|
Accounts receivable, net | |
| 2,983,841 | | |
| 1,805,980 | | |
|
Inventory, net | |
| 2,137,912 | | |
| 1,787,308 | | |
|
Prepaid expenses and other current assets (including prepaid
inventory in amount of $535,938 and
-0- as of June 30, 2025 and 2024, respectively) | |
| 748,044 | | |
| 76,815 | | |
|
Total current assets | |
| 6,664,633 | | |
| 4,656,530 | | |
|
| |
| | | |
| | | |
|
Other asset: | |
| | | |
| | | |
|
Lease right-of-use asset, net | |
| 140,540 | | |
| | | |
|
| |
| | | |
| | | |
|
Total assets | |
$ | 6,805,173 | | |
$ | 4,656,530 | | |
|
| |
| | | |
| | | |
|
Liabilities and Stockholders' Equity | |
| | | |
| | | |
|
Current liabilities: | |
| | | |
| | | |
|
Accounts payable | |
$ | 689,216 | | |
$ | 5,316 | | |
|
Accrued liabilities | |
| 78,934 | | |
| 55,784 | | |
|
Lease liability | |
| 140,540 | | |
| | | |
|
Short-term notes payable | |
| 2,603,223 | | |
| | | |
|
Total current liabilities | |
| 3,511,913 | | |
| 61,100 | | |
|
| |
| | | |
| | | |
|
Payable to line of credit lender | |
| 383,538 | | |
| | | |
|
Total liabilities | |
| 3,895,451 | | |
| 61,100 | | |
|
| |
| | | |
| | | |
|
Commitments and contingencies (Note 5) | |
| | | |
| | | |
|
| |
| | | |
| | | |
|
Stockholders' equity: | |
| | | |
| | | |
|
Common stock, $0.001 par value, 100,000,000 shares authorized,34,124,873 shares and 33,236,091 shares issued and outstanding, respectively | |
| 34,125 | | |
| 33,236 | | |
|
Additional paid-in capital | |
| 28,652,731 | | |
| 25,304,732 | | |
|
Accumulated deficit | |
| (25,777,134 | ) | |
| (20,742,538 | ) | |
|
Total stockholders' equity | |
| 2,909,722 | | |
| 4,595,430 | | |
|
| |
| | | |
| | | |
|
Total liabilities and stockholders' equity | |
$ | 6,805,173 | | |
$ | 4,656,530 | | |
****
See Accompanying Notes to Financial Statements.
| | 29 | | |
****
**NEOVOLTA INC.**
**Statements of Operations**
|
| |
| | |
| | |
|
| |
Year Ended June 30, | | |
|
| |
2025 | | |
2024 | | |
|
| |
| | |
| | |
|
Revenues from contracts with customers | |
$ | 8,426,835 | | |
$ | 2,645,072 | | |
|
Cost of goods sold | |
| 6,920,130 | | |
| 2,134,725 | | |
|
Gross profit | |
| 1,506,705 | | |
| 510,347 | | |
|
| |
| | | |
| | | |
|
Operating expenses: | |
| | | |
| | | |
|
General and administrative | |
| 6,065,590 | | |
| 2,828,147 | | |
|
Research and development | |
| 157,305 | | |
| 19,154 | | |
|
Total operating expenses | |
| 6,222,895 | | |
| 2,847,301 | | |
|
| |
| | | |
| | | |
|
Loss from operations | |
| (4,716,190 | ) | |
| (2,336,954 | ) | |
|
| |
| | | |
| | | |
|
Other income (expense): | |
| | | |
| | | |
|
Interest income | |
| 2,011 | | |
| 33,644 | | |
|
Interest expense | |
| (320,417 | ) | |
| | | |
|
Total other income (expense) | |
| (318,406 | ) | |
| 33,644 | | |
|
| |
| | | |
| | | |
|
Net loss | |
$ | (5,034,596 | ) | |
$ | (2,303,310 | ) | |
|
| |
| | | |
| | | |
|
Weighted average shares outstanding - basic and diluted | |
| 33,589,818 | | |
| 33,213,306 | | |
|
| |
| | | |
| | | |
|
Net loss per share - basic and diluted | |
$ | (0.15 | ) | |
$ | (0.07 | ) | |
See Accompanying Notes to Financial Statements.
****
| | 30 | | |
****
****
**NEOVOLTA INC.**
**Statements of Stockholders' Equity**
**Years Ended June 30, 2025 and 2024**
|
| |
| | |
| | |
| | |
| | |
| | |
|
| |
| | |
| | |
Additional | | |
| | |
Total | | |
|
| |
Common Stock | | |
Paid-in | | |
Accumulated | | |
Stockholders' | | |
|
| |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Equity | | |
|
| |
| | |
| | |
| | |
| | |
| | |
|
Balance at June 30, 2023 | |
| 33,155,127 | | |
$ | 33,155 | | |
$ | 24,872,446 | | |
$ | (18,439,228 | ) | |
$ | 6,466,373 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Stock compensation expense | |
| 80,964 | | |
| 81 | | |
| 432,286 | | |
| | | |
| 432,367 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Net loss | |
| | | |
| | | |
| | | |
| (2,303,310 | ) | |
| (2,303,310 | ) | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Balance at June 30, 2024 | |
| 33,236,091 | | |
| 33,236 | | |
| 25,304,732 | | |
| (20,742,538 | ) | |
| 4,595,430 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Stock compensation expense | |
| 289,870 | | |
| 290 | | |
| 2,101,198 | | |
| | | |
| 2,101,488 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Exercise of common stock warrants | |
| 55,412 | | |
| 55 | | |
| 160,345 | | |
| | | |
| 160,400 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Issuance of common stock in private offering | |
| 543,500 | | |
| 544 | | |
| 1,086,456 | | |
| | | |
| 1,087,000 | | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Net loss | |
| | | |
| | | |
| | | |
| (5,034,596 | ) | |
| (5,034,596 | ) | |
|
| |
| | | |
| | | |
| | | |
| | | |
| | | |
|
Balance at June 30, 2025 | |
| 34,124,873 | | |
$ | 34,125 | | |
$ | 28,652,731 | | |
$ | (25,777,134 | ) | |
$ | 2,909,722 | | |
See Accompanying Notes to Financial Statements.
| | 31 | | |
****
**NEOVOLTA INC.**
**Statements of Cash Flows**
|
| |
| | | |
| | | |
|
| |
Year Ended June 30, | | |
|
| |
2025 | | |
2024 | | |
|
Cash flows from operating activities: | |
| | | |
| | | |
|
Net loss | |
$ | (5,034,596 | ) | |
$ | (2,303,310 | ) | |
|
Adjustments to reconcile net loss to net cash used in operations: | |
| | | |
| | | |
|
Stock compensation expense | |
| 2,101,488 | | |
| 432,367 | | |
|
Amortization of ROU asset | |
| 80,570 | | |
| | | |
|
Provision for expected credit losses/bad debt expense | |
| (4,253 | ) | |
| 540,000 | | |
|
Reserve for obsolete inventory | |
| (90,000 | ) | |
| 90,000 | | |
|
Changes in current assets and liabilities | |
| | | |
| | | |
|
Accounts receivable | |
| (1,630,876 | ) | |
| (519,595 | ) | |
|
Inventory | |
| 131,864 | | |
| 703,263 | | |
|
Prepaid expenses and other current assets | |
| (606,429 | ) | |
| 19,304 | | |
|
Accounts payable | |
| 683,900 | | |
| 5,316 | | |
|
Accrued expenses | |
| 23,150 | | |
| 16,293 | | |
|
Operating lease obligation | |
| (80,570 | ) | |
| | | |
|
Net cash flows used in operating activities | |
| (4,425,752 | ) | |
| (1,016,362 | ) | |
|
| |
| | | |
| | | |
|
Cash flows from financing activities: | |
| | | |
| | | |
|
Proceeds of private equity offering | |
| 1,087,000 | | |
| | | |
|
Borrowings under line of credit | |
| 500,000 | | |
| | | |
|
Repayments of line of credit | |
| (116,462 | ) | |
| | | |
|
Borrowings under short-term nots payable | |
| 5,106,343 | | |
| | | |
|
Repayments of short-term nots payable | |
| (2,503,120 | ) | |
| | | |
|
Proceeds from exercise of common stock warrants | |
| 160,400 | | |
| | | |
|
Net cash flows from financing activities | |
| 4,234,161 | | |
| | | |
|
| |
| | | |
| | | |
|
Net decrease in cash and cash equivalents | |
| (191,591 | ) | |
| (1,016,362 | ) | |
|
| |
| | | |
| | | |
|
Cash and cash equivalents at beginning of period | |
| 986,427 | | |
| 2,002,789 | | |
|
| |
| | | |
| | | |
|
Cash and cash equivalents at end of period | |
$ | 794,836 | | |
$ | 986,427 | | |
|
| |
| | | |
| | | |
|
Supplemental disclosures of cash flow information: | |
| | | |
| | | |
|
Cash paid for interest | |
$ | 136,580 | | |
$ | | | |
|
Cash paid for income taxes | |
| | | |
| | | |
|
| |
| | | |
| | | |
|
Supplemental investing and financing activities: | |
| | | |
| | | |
|
ROU asset recognized from operating lease | |
$ | 221,110 | | |
$ | | | |
See Accompanying Notes to Financial Statements.
| | 32 | | |
**NEOVOLTA INC.**
**Notes to Financial Statements**
**June 30, 2025**
**(1) Business and Summary of Significant Accounting
Policies**
*Description of Business*
NeoVolta Inc. (we, our or the "Company") is a Nevada corporation, which was formed on March
5, 2018. The Company is a designer, seller and manufacturer of Energy Storage Systems (ESS) which can store and use energy via batteries
and an inverter at residential sites. The Company sells its proprietary ESS units through wholesale customers, initially in California,
and in an expanding number of other states. In August 2022, the Company completed an underwritten public offering of its equity securities
resulting in its common stock and warrants becoming listed on a national exchange (see Note 3).
*Basis of Presentation*
The accompanying financial statements and related notes have been prepared in accordance with accounting principles generally
accepted in the United States of America (U.S. GAAP) and in accordance with the rules and regulations of the United States
Securities and Exchange Commission (the SEC).
*Cash and Cash Equivalents*
The Company considers all highly liquid accounts with original maturities of three months or less at the date of acquisition to
be cash equivalents. Periodically, the Company may carry cash balances at financial institutions in excess of the federally insured
limit of $250,000. As of June 30, 2025, the Company maintained all of its accounts at one bank and the combined balances of all accounts
at this bank were in excess of the FDIC insurance limit by $544,836.
*Inventory*
Inventory consists of batteries and inverters purchased from Asian suppliers and delivered to a location near the Companys
offices, for assembly into ESS units. Inventory is stated at the lower of cost or net realizable value, cost being determined using the
first-in, first out (FIFO) method. The Company periodically reviews the value of items in inventory and records an allowance to reduce
the carrying value of inventory to the lower of cost or net realizable value based on its assessment of market conditions, inventory
turnover and current stock levels. Inventory write-downs are charged to cost of goods sold. The following table presents the components
of inventory (net of reserve for obsolescence on assembly parts of zero and $90,000, respectively) as of June 30, 2025 and 2024:
|
Schedule of inventory | |
| | | |
| | | |
|
| |
June 30, | | |
|
| |
2025 | | |
2024 | | |
|
| |
| | |
| | |
|
Raw materials, consisting of assembly parts, batteries and inverters | |
$ | 2,014,252 | | |
$ | 1,076,479 | | |
|
Work in process | |
| | | |
| 89,386 | | |
|
Finished goods | |
| 123,660 | | |
| 621,443 | | |
|
| |
| | | |
| | | |
|
Total | |
$ | 2,137,912 | | |
$ | 1,787,308 | | |
*Revenue Recognition*
The Company recognizes revenue in accordance with Accounting Standard Update ("ASU") 2014-09, Revenue from Contracts
with Customers (Topic 606). Revenues are recognized when control of the promised goods is transferred to the customer in an amount that
reflects the consideration the Company expects to be entitled to in exchange for transferring those goods or services. Revenue is recognized
based on the following five step model:
|
| Identification of the contract with a customer | |
|
| Identification of the performance obligations
in the contract | |
|
| Determination of the transaction price | |
|
| Allocation of the transaction price to the performance
obligations in the contract | |
|
| Recognition of revenue when, or as, the Company
satisfies a performance obligation | |
| | 33 | | |
The Company generates revenues
from contracts with customers, consisting of a relatively small number of wholesale dealers and installers, in California and several
other states. In the year ended June 30, 2025, two such dealers represented approximately 41% and 23% of the Companys revenues,
however, no other dealers accounted for more than 10% of the revenues in such period. Those same two dealers plus one other one represented
approximately 39%, 12% and 12% of the Companys net accounts receivable as of June 30, 2025, however, no other dealers accounted
for more than 10% of the accounts receivable as of June 30, 2025. In the year ended June 30, 2024, two such dealers represented approximately
20% and 14% of the Companys revenues. Under its present contracts with customers, the Companys sole performance obligation
is the delivery of products to the customer. Since all of the Companys revenue is currently generated from the sales of similar
products delivered to customers in domestic locations, no further disaggregation of revenue information for the years ended June 30, 2025
and 2024 is provided.
*Allowance for Expected
Credit Losses*The Company recognizes an allowance for expected credit losses whenever a loss is expected to be incurred
in the realization of a customers account. As of June 30, 2025 and 2024, our allowance for expected credit losses was $314,200
and $1,030,000, respectively.
*Income Taxes*
The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities
are determined based on the differences between the financial reporting and the tax bases of reported assets and liabilities and are measured
using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company must then assess
the likelihood that the resulting deferred tax assets will be realized. A valuation allowance is provided when it is more likely than
not that some portion or all of a deferred tax asset will not be realized.
The Company accounts for uncertain
tax positions in accordance with the provisions of Accounting Standards Codification (ASC) 740-10 which prescribes a recognition
threshold and measurement attribute for financial statement disclosure of tax positions taken, or expected to be taken, on its tax return.
The Company evaluates and records any uncertain tax positions based on the amount that management deems is more likely than not to be
sustained upon examination and ultimate settlement with the tax authorities in the tax jurisdictions in which it operates.
*Stock Compensation Expense*
Employee and non-employee share-based payment compensation is measured at the grant date, based on the fair value of the award,
and is recognized as an expense over the requisite service period.
**
*Loss Per Common Share*
Basic loss per common share is computed by dividing net loss available to common shareholders by the weighted-average number of
common shares outstanding during the period. Diluted loss per common share is determined using the weighted-average number of common shares
outstanding during the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, the
weighted-average number of common shares outstanding excludes common stock equivalents, because their inclusion would be anti-dilutive.
As of June 30, 2025, the Company had total outstanding common stock equivalents of 2,937,512 shares as follows: (i) 1,806,362 shares related
to restricted stock units granted to an officer and another employee in April 2024; (ii) 1,081,150 shares related to warrants issued to
investors in the public offering completed in August 2022; and (iii) 50,000 shares related to restricted stock units granted to an officer
in March 2022 (see Note 3).
*Research and Development
Costs* Research and development costs are expensed as incurred.
*Use of Estimates*
Management has made a number of estimates and assumptions in preparing these financial statements in conformity with accounting principles
generally accepted in the United States of America. Actual results could differ from those estimates.
| | 34 | | |
*Segment Information*
Management has determined that the Company operates inonereportable segment, which is the development and commercialization
of energy storage products. The Company's chief operating decision maker (CODM) is its Chief Executive Officer, who reviews financial
information presented on a company-wide basis. The CODM primarily uses net loss, which is reported in the Statements of Operations, to
assess financial performance and allocate resources. These financial metrics are used by the CODM to make key operating decisions, such
as the assessment of segment performance and allocation of resources. The significant categories within net loss that the CODM regularly
reviews are revenues from customers, cost of goods sold, and general and administrative expenses. Other expenses reported in the Companys
net loss include interest expense and research and development expenses.
**
*Recent Accounting Pronouncements*
From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board, (FASB),
or other standard setting bodies and adopted by us as of the specified effective date. Unless otherwise discussed, the impact of recently
issued standards, including ASU 2023-07, *Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,*and prospective
standards that are not yet effective, including ASU 2024-03, *Income Statement Reporting Comprehensive Income Expense
disaggregation disclosures (Topic 220-40): Disaggregation of Income Statement Expenses,* will not have a material impact on the Companys
financial position or results of operations upon adoption. 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.
*Liquidity* These
financial statements have been prepared on a going concern basis, which assumes the Company will continue to realize its assets and discharge
its liabilities in the normal course of business. The continuation of the Company as a going concern has been dependent upon our ability
to obtain the necessary debt and equity financing to continue operations and the attainment of profitable operations.
As disclosed in Note 2, we
entered into an agreement with a financing entity in September 2024 whereby we have obtained a line of credit for borrowings of up to
$5,000,000, in order to meet any near-term borrowing needs. As a result, we believe that we will have sufficient financial resources available
to us in order to operate our business for at least the next 12 months from the date these financial statements are issued.
|
(2) |
Debt | |
On September 3, 2024, we
entered into an agreement with a newly formed financing entity whereby we obtained a line of credit for borrowings of up to $5,000,000.
Under this agreement, we are obligated to make periodic payments to the lender of accrued interest, at the rate of 16%
per annum, on any outstanding borrowings that we make, with the principal and any unpaid accrued interest being due at maturity,
which was subsequently extended to September
3, 2028 (see Note 6). In order to secure such borrowings, we have granted a security interest in all of our assets to the
lender. As a condition of receiving this line of credit from the lender, we have agreed not to issue any securities pursuant to the
Companys Form S-3 (file number 333-280400), without the lenders consent, so long as any borrowings remain outstanding.
As of June 30, 2025, we had made net borrowings under this credit agreement in the amount of $383,538,
leaving an available balance of $4,616,462.
Accrued interest as of June 30, 2025 was $30,767.
On October 4, 2024, we made
an initial borrowing of $250,000 under this line of credit largely in order to fund a short-term loan in the same amount to a new customer
which has a government-backed contract to install a large number of our units in Puerto Rico over a two year period. The purpose of the
loan was to provide working capital to the customer in conjunction with the startup of the contract in Puerto Rico. The loan was structured
to be non-interest bearing, if repaid prior to December 31, 2024. The loan was fully repaid in December 2024.
In the month of November 2024,
we initiated short-term borrowings from a commercial accounts receivable lender under a loan agreement allowing for borrowings, secured
by certain property interests, of up to $4,000,000. As of June 30, 2025, we had made borrowings from this lender to finance customer shipments
and related costs in the total amount of $5,106,343. The lender charges a placement fee of 1% on each borrowing and assesses interest
at the rate of 2.5% per month on the outstanding borrowings. Borrowings are to be repaid upon the earlier of: (i) 120 days from the borrowing
date; or (ii) receipt of payment from the customer. In the event of default, interest is assessed at the default rate of 1% per 7 days.
Through June 30, 2025, we had repaid $2,503,120 of such borrowings, including accrued interest and fees, leaving an outstanding balance
as of that date, including accrued interest and fees, of $2,603,223.
| | 35 | | |
|
(3) |
Equity | |
*Common Stock*
In February 2025, the Company closed a private equity offering under which the Company issued a total of 543,500 shares of its common
stock to the investors at an offering price of $2.00 per share resulting in gross proceeds to the Company in the amount of $1,087,000.
The Company is using the proceeds of this private offering to meet working capital needs and for other general corporate purposes.
In August 2022, the Company
completed an underwritten public offering of its equity securities in the form of Units with each Unit consisting of one share of common
stock and one warrant (each, a Warrant and collectively, the Warrants) to purchase one share of common stock
at an exercise price of $4.00 per share. The shares of common stock and the Warrants comprising the Units were immediately separated at
closing of the offering and each is now independently listed on the NASDAQ Capital Market. Each Warrant became exercisable on the date
of issuance and will expire five years from the date of issuance.
In the underwritten public
offering, a total of 1,121,250 Units, including exercise of the underwriters overallotment option, were sold at an offering price
to the public of $4.00 per Unit. The gross proceeds of the offering were $4,485,000 and the net proceeds, after deduction of underwriting
discounts and other offering costs were approximately $3,780,000. The Company also granted the underwriter non-tradeable warrants to purchase
a total of 58,500 shares of common stock at an exercise price of $4.40 per share for a period of five years.
In conjunction with the public
offering, all holders of the Companys 2018 convertible notes in the total amount of $59,251, including accrued interest, converted
their debt into a total of 9,404,867 shares of common stock at the stated conversion rate, and all holders of the Companys 2021
convertible notes in the total amount of $1,068,000 converted their debt into a total of 267,000 shares of common stock at the stated
conversion rate.
*Warrants* The
Warrants for a total of 1,179,750 shares of common stock issued to investors and the underwriters are exercisable at any time after their
original issuance and at any time up to the date that is five years after their original issuance, or August 1, 2027. The Warrants may
be exercised upon payment of the exercise price in cash on or prior to the expiration date. Under the terms of the Warrant Agreement,
we must use our best efforts to maintain the effectiveness of the registration statement and current prospectus relating to common stock
issuable upon exercise of the Warrants until the expiration of the Warrants. If we fail to maintain the effectiveness of the registration
statement and current prospectus relating to the common stock issuable upon exercise of the Warrants, the holders of the Warrants shall
have the right to exercise the Warrants solely via a cashless exercise feature provided for in the Warrants, until such time as there
is an effective registration statement and current prospectus. In June 2024, the Company filed an updated registration statement applicable
to the exercise of the Warrants.
The following table presents
activity with respect to the Companys warrants for the years ended June 30, 2025 and 2024:
|
Schedule of warrant activity | |
| | | |
| | | |
| | | |
| | | |
|
| |
Number | | |
Wtd. Avg. | | |
Wtd. Avg. | | |
Aggregate | | |
|
| |
of | | |
Exercise | | |
Remaining | | |
Intrinsic | | |
|
| |
Shares | | |
Price | | |
Term (Yrs.) | | |
Value | | |
|
| |
| | |
| | |
| | |
| | |
|
Outstanding at July 1, 2023 | |
| 1,179,750 | | |
$ | 4.02 | | |
| 4.1 | | |
$ | | | |
|
Warrants issued | |
| | | |
| | | |
| | | |
| | | |
|
Warrants exercised/forfeited | |
| | | |
| | | |
| | | |
| | | |
|
Outstanding at June 30, 2024 | |
| 1,179,750 | | |
| 4.02 | | |
| 3.1 | | |
| | | |
|
Warrants issued | |
| | | |
| | | |
| | | |
| | | |
|
Warrants exercised/forfeited | |
| (98,600 | ) | |
| (4.24 | ) | |
| | | |
| | | |
|
Outstanding at June 30, 2025 | |
| 1,081,150 | | |
$ | 4.00 | | |
| 2.1 | | |
$ | | | |
|
| |
| | | |
| | | |
| | | |
| | | |
|
Exercisable at June 30, 2025 | |
| 1,081,150 | | |
$ | 4.00 | | |
| 2.1 | | |
$ | | | |
| | 36 | | |
These warrants were issued
in conjunction with an underwritten public equity offering, therefore, there was no employee or non-employee compensation expense recognized.
In November 2024, the underwriter elected to exercise all 58,500 Warrants at an exercise price of $4.40 per share, via a cashless exercise,
as permitted under the warrant agreement, resulting in the issuance of 15,312 shares of our common stock. Additionally, the holders of
publicly issued Warrants to purchase an aggregate of 40,100 shares of our common stock elected to exercise their Warrants by a cash payment
of a total of $160,400 resulting in the issuance of the underlying shares of our common stock in December 2024.
*Stock Compensation Expense*
In April 2024, we entered into an employment agreement with a new Chief Executive Officer (CEO), providing for an
initial term extending through June 30, 2027, which will be automatically renewed for additional one-year terms unless either party chooses
not to renew it. Pursuant to the agreement, our new CEO received an initial equity grant equal to 1,280,000 restricted stock units (RSUs),
with a grant date value of $2,854,000, which will vest over a four-year period,
subject to his continued employment with the Company, and will be entitled to earn additional RSUs on each anniversary in the form
of three annual performance-based equity grants. However, our Compensation
Committee has not set any definitive targets, therefore, no additional grants have been made as of June 30, 2025.
In February 2025, we entered
into an amended and restated employment agreement with our Chief Financial Officer (CFO). The initial term of the employment
agreement ends on December 31, 2027 and will be automatically renewable for additional one-year terms unless either party chooses not
to renew the agreement. Pursuant to the agreement, we issued our CFO an award of 240,000 RSUs vesting in four annual installments on each
anniversary.
In February 2022, we entered
into a new employment agreement with our CFO pursuant to which we issued him an RSU award for up to 300,000 shares of our common stock
upon achieving two defined milestones. The first milestone was achieved as of January 1, 2023, and the underlying 250,000 shares of common
stock were issued to our CFO as of that date. The second milestone was achieved as of January 1, 2024, and the underlying 50,000 shares
of common stock are expected to be issued to our CFO at a later date.
In January 2025, we entered
into an employment agreement with our new Chief Operating Officer (COO). The initial term of the employment agreement ends
on December 31, 2027 and will be automatically renewable for additional one-year terms unless either party chooses not to renew the agreement.
Pursuant to the agreement, we issued our COO an award of 150,000 RSUs vesting in three annual installments. Additionally, we entered into
employment agreements with two other individuals in June 2024 and October 2024, and we issued them a total of 136,362 RSUs vesting in
four annual installments. As a result, we presently have a total of 1,806,362 RSUs that have been issued to our three officers and two
other individuals. For all of these awards, we have calculated the grant date value of such awards and are amortizing it as stock compensation
expense over the underlying vesting periods. We have recognized stock compensation expense applicable to such RSU awards in the years
ended June 30, 2025 and 2024 in the amounts of $1,011,405 and $214,992, respectively.
In February 2025, we entered
into a referral agreement with a marketing company to market our products to qualified solar and energy storage system installers. The
term of the referral agreement ends on December 31, 2026. Pursuant to the agreement, the only compensation that the marketing company
will be entitled to receive will be through the issuance of shares of our common stock in exchange for reaching specified target levels
of product sales, up to a maximum total of 2,000,000 shares for reaching a total of 2,500 units sold and paid for. In accordance with
ASC 718, we are accounting for this agreement based on our periodic assessments of the probability of reaching such target levels. Based
on that approach, we have recognized stock compensation expense as of June 30, 2025, in the amount of $165,000.
In conjunction with our public
offering in August 2022, we appointed two new independent directors and adopted a new compensation plan for all independent directors
based on an annual compensation amount of $65,000 to be paid quarterly with not less than 70% of such amount paid in shares of our common
stock, calculated based on the share price at the end of such prior fiscal quarter, and up to 30% paid in cash, with such final amounts
to be determined by each director. As of June 30, 2025 and 2024, we booked an annual accrual of $195,000 of compensation expense (of which
$175,500 will be settled through the issuance of shares) for our three independent directors under this plan.
| | 37 | | |
In the year ended June
30, 2025, we recognized total non-cash stock compensation expense of $2,101,488
as follows: (i) $1,011,405
for the amortized value of the RSUs granted to our three officers and two other individuals; (ii) $175,500
for the amortized value of the portion of the new compensation plan for our independent directors that is attributable to stock;
(iii) $515,498
for the fair value of the issuance of 174,650 shares of our common stock to two consultants for their advisory services in
the area of energy regulatory and marketing matters; (iv) $234,085
for the grant date value of 78,565
shares of common stock to be issued to a distributor as a sales incentive pursuant to a February 2025 distribution agreement; and
(v) $165,000
for the amortized value of the shares potentially issuable to a marketing company pursuant to a February 2025 referral agreement.
There was a total of 289,870
shares of our common stock that were issued to various grantees for services in the year ended June 30, 2025, of which 125,620
shares were previously expensed in the year ended June 30, 2024.
In the year ended June 30,
2024, we recognized total non-cash stock compensation expense of $432,367 as follows: (i) $214,992 for the amortized value of the RSUs
granted to our three executive officers and a non-executive recipient, as previously described; (ii) $175,500 for the amortized value
of the portion of the new compensation plan for our independent directors that is attributable to stock; (iii) $29,450 for the net amortized
value of the shares granted to various advisors under their annual service contracts; and (iv) $12,425 for the fair value of incentive
shares earned by a wholesale dealer as of December 31, 2023 (see Note 5). There was a total of 80,964 shares of common stock that were
issued to our independent directors in the year ended June 30, 2024, which were previously expensed in the year ended June 30, 2023.
*Other Matters*
In February 2019, the Companys Board of Directors approved the establishment of a new 2019 Stock Option Plan with an authorization
for the issuance of up to 2,500,000 shares of common stock. In December 2024, the Plan was amended to increase the number of shares of
common stock authorized for issuance by 5,000,000 shares. The Plan is designed to provide for future discretionary grants of stock options,
stock awards and stock unit awards to key employees and non-employee directors. As of June 30, 2025, we have made total awards of 2,615,054
shares under the Plan as follows: (i) 2,256,362 shares for the RSUs granted to our three executive officers and two non-executive recipients,
as noted above; (ii) 153,808 shares for the services of our three independent directors in the years ended June 30, 2024 and 2023, pursuant
to the new compensation plan adopted for independent directors in August 2022; and (iii) 204,884 shares granted to various consultants
for their services and to wholesale dealers under an incentive sales program.
|
(4) | Income Taxes |
|
****
The Company is subject to
United States federal income taxes at an approximate rate of 21%. The reconciliation of the provision for income taxes at the federal
statutory rate, compared to the Companys income tax expense as reported, is as follows (rounded to nearest $00):
|
Schedule of income tax expense | |
| | |
| | |
|
| |
Year Ended June 30, | | |
|
| |
2025 | | |
2024 | | |
|
| |
| | |
| | |
|
Income tax benefit computed at statutory rate | |
$ | 747,900 | | |
$ | 279,400 | | |
|
Change in valuation allowance | |
| (747,900 | ) | |
| (279,400 | ) | |
|
Provision for income taxes | |
$ | | | |
$ | | | |
Significant components of
the Companys deferred tax assets at the currently enacted corporate income tax rate are as follows (rounded to nearest $00):
|
Schedule of deferred taxes | |
| | |
| | |
|
| |
June 30, 2025 | | |
June 30, 2024 | | |
|
Deferred income tax assets: | |
| | | |
| | | |
|
Net operating losses | |
$ | 1,570,100 | | |
$ | 824,300 | | |
|
Valuation allowance | |
| (1,570,000 | ) | |
| (824,300 | ) | |
|
Net deferred income tax assets | |
$ | | | |
$ | | | |
The Company has a cumulative
tax operating loss carry forward as of June 30, 2025 of approximately $7,477,000, with an indefinite expiration period.
| | 38 | | |
|
(5) | Commitments and Contingencies | |
****
Effective January 1, 2021,
we secured new corporate and manufacturing office space under a sublease agreement with a company that served as our contract manufacturer
at that time. Under the terms of the sublease agreement, we were required to make rental payments of $10,350 per month during the initial
one-year term of the agreement. Further, under the terms of the sublease agreement, we were granted the right to renew the sublease for
additional terms of 12 months each upon mutual agreement of both parties, provided thirty days notice is given for each subsequent
term, at a modest increase in the monthly rent, through December 31, 2024. However, we were under no obligation to renew it. At inception
of the sublease, management determined that exercise of the renewal option was not reasonably certain and, notwithstanding that the Company
elected to renew the agreement for additional one year periods as of January 1, 2022, 2023 and 2024. Accordingly, we have accounted for
it as a short-term lease under ASC 842, *Leases*. Effective December 31, 2024, the parties mutually agreed to a short-term extension
of the sublease agreement, on essentially the same terms, through February 28, 2025. Prior to expiration of the extended sublease, the
Company relocated its corporate and manufacturing office space to another facility in the same vicinity under a 13 month sublease agreement
with the sublandlord, at a base rental of $18,638 per month. We are accounting for the lease agreement as an operating lease under ASU
2016-02, *Leases (Topic 842)*. Accordingly, the Company has capitalized the present value of the future lease obligations and is
amortizing the related right-of-use asset on a straight-line basis each month over the term of the lease.
As indicated in Note 1, the
Company sells its proprietary ESS units through wholesale dealers, primarily in California. In that regard, the Company has entered into
agreements with several wholesale dealers operating in California and other states under which the Company has incentivized the dealers
to achieve quarterly sales above targeted levels by agreeing to grant them shares of the Companys common stock for exceeding such
quarterly sales targets, subject to defined maximums, as determined annually on a calendar year basis.
****
We are dependent on our two
main component vendors for our suppliers of batteries, inverters and other raw materials and the inability of these single-source suppliers
to deliver necessary components of our products according to our schedule and at prices, quality levels and volumes acceptable to us,
or our inability to efficiently manage these components, could have a material adverse effect on our financial condition and operating
results. Beginning in April 2025, the Trump Administration implemented a significant increase in tariff rates on all goods imported from
China, although it was temporarily suspended for 90 days in April 2025 and the suspension has recently been extended to early November
2025. Prior to the tariff escalation in April 2025, we had anticipated the likelihood of facing such a tariff increase and began stockpiling
our inventory of these two components. As a result, we do not anticipate having to purchase a significant level of such components at
post-tariff prices for the next several months.
From time to time in the ordinary
course of our business, the Company may be involved in legal proceedings, the outcomes of which may not be determinable. The Company is
not involved in any legal proceedings at this time. The results of litigation are inherently unpredictable. Any claims against us, whether
meritorious or not, could be time consuming, result in costly litigation, require significant amounts of management time and result in
diversion of significant resources. We are not able to estimate an aggregate amount or range of reasonably possible losses for those legal
matters for which losses are not probable and estimable.
| | 39 | | |
|
(6) | Subsequent Events | |
****
On July 4, 2025, Congress
passed, and the President signed into law the *One Big Beautiful Bill Act (OBBB).*Among other provisions, it extends
many of the expiring provisions from the *Tax Cuts and Jobs Act* of 2017 and phases out a number
of clean energy tax incentives, including credits for the installation of residential solar panels. Based on our preliminary analysis,
however, we do not expect passage of the OBBB to have a material impact on our business.
On July 23, 2025, we issued
78,565 shares of common stock to a wholesale distributor as a sales incentive pursuant to a February 2025 distribution agreement and 10,400
shares of common stock to a product marketing consultant pursuant to a February 2025 letter agreement, which were previously expensed
in the year ended June 30, 2025 (see Note 3).
On August 22, 2025, we issued
Non-Qualified Stock Options to a group of our employees to purchase a total of 144,000 shares of our common stock at the current stock
price of $3.60 per share, pursuant to the provisions of our 2019 Stock Option Plan. These options are exercisable for a period of 5 years
from the date of issuance and will become vested on a ratable basis over a period of 3 years from the date of issuance. Using the Black-Scholes
valuation model, we have calculated that the total fair value of these options as of the date of issuance was approximately $342,400,
and we will amortize this total amount to stock compensation expense on a straight-line basis over the 3-year vesting period of the options.
On September 5, 2025, we obtained
a two year extension of the maturity date of our $5 million line of credit agreement from the lender to September 3, 2028 (see Note 2).
| | 40 | | |
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
****
**Evaluation of Disclosure Controls and Procedures.**
Our management, including
our Chief Executive Officer, who is our principal executive officer, and our Chief Financial Officer, who is our principal financial officer,
has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act), as of June 30, 2025, the end of the period covered by this Report. Based on this evaluation, our Chief
Executive Officer and our Chief Financial Officer, concluded that our disclosure controls and procedures were not effective as of June
30, 2025, largely due to our relatively small number of employees rendering a full segregation of various disclosure control duties impractical.
**Inherent Limitations over Controls**
****
Management does not expect
that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all
fraud. Controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives
and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because
of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and
instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in
decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented
by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any
system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance
that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate
because of changes in conditions, or deterioration in the degree of compliance with the policies or procedures. Because of the inherent
limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.
.
**Management's Report on Internal Control Over
Financial Reporting**
Our
principal executive officer and our principal accounting and financial officer, are responsible for establishing and maintaining adequate
internal control over financial reporting, as such term is defined in Exchange Act Rule13a-15(f). Management conducted an assessment
of the effectiveness of our internal control over financial reporting as of June 30, 2025. In making this assessment, management used
the criteria described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO). Our management concluded that there was a material weakness in our internal controls over financial reporting largely
due to our relatively small number of employees rendering a full segregation of various accounting control and financial reporting duties,
which includes multiple levels of review, impractical. Accordingly, our
internal controls over financial reporting were not effectiveas of June 30, 2025.
Our independent registered
public accounting firm will not be required to formally attest to the effectiveness of our internal controls over financial reporting
for as long as we are an emerging growth company or a non-accelerated filer.
| | 41 | | |
**Changes in Internal Controls**
There were no changes in the
Companys internal controls over financial reporting that occurred during the quarter ended June 30, 2025 that have materially affected,
or is reasonably likely to materially affect, our internal controls over financial reporting.
ITEM 9B. OTHER INFORMATION.
To
our knowledge, no director or officer of the Company adopted or terminated a "Rule 10b5-1
trading arrangement or non-Rule 10b5-1 trading arrangement, as each term is defined in Item 408(a) of Regulation
S-K, during the three months ended June 30, 2025.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS
THAT PREVENT INSPECTIONS.
Not applicable.
| | 42 | | |
**PART III**
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND
CORPORATE GOVERNANCE
The
information required by this item is incorporated by reference to our proxy statement for the 2025 Annual Meeting of Stockholders to be
filed with the Securities and Exchange Commission within 120 days of the fiscal year ended June 30, 2025 and is incorporated into this
Annual Report on Form 10-K by reference.
Our
Board of Directors has adopted a written Code of Business Conduct and Ethics applicable to all officers, directors and employees, which
is available on our website (www.neovolta.com) under Governance within the Investors section. We intend to
satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding amendment to, or waiver from, a provision of this Code by posting
such information on the website address and location specified above.
ITEM 11. EXECUTIVE COMPENSATION
The
information required by this item is incorporated by reference to our proxy statement for the 2025 Annual Meeting of Stockholders to be
filed with the Securities and Exchange Commission within 120 days of the fiscal year ended June 30, 2025 and is incorporated into this
Annual Report on Form 10-K by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The
information required by this item is incorporated by reference to our proxy statement for the 2025 Annual Meeting of Stockholders to be
filed with the Securities and Exchange Commission within 120 days of the fiscal year ended June 30, 2025 and is incorporated into this
Annual Report on Form 10-K by reference.
**Securities Authorized for Issuance under Equity Compensation Plans**
The following table sets forth
information regarding our equity compensation plans at June 30, 2025:
|
Plan category |
|
Number of securities to be
issued upon
exercise of
outstanding
options,
warrants and
rights
(a) |
|
|
Weighted-
average exercise price
of
outstanding
options,
warrants and
rights
(b) |
|
|
Number of securities
(by class) remaining
available for future
issuance under
equity compensation
plans (excluding
securities reflected in
column (a))
(c) |
| |
|
Equity compensation plans approved by security holders (1) |
|
|
7,500,000 |
|
|
$ |
3.30 |
|
|
|
1,806,362 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
(1) |
Represents shares of common stock issuable upon exercise of outstanding restricted stock units under our 2019 Stock Plan. | |
| | 43 | | |
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The
information required by this item is incorporated by reference to our proxy statement for the 2025 Annual Meeting of Stockholders to be
filed with the Securities and Exchange Commission within 120 days of the fiscal year ended June 30, 2025 and is incorporated into this
Annual Report on Form 10-K by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The
information required by this item is incorporated by reference to our proxy statement for the 2025 Annual Meeting of Stockholders to be
filed with the Securities and Exchange Commission within 120 days of the fiscal year ended June 30, 2025 and is incorporated into this
Annual Report on Form 10-K by reference.
| | 44 | | |
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS
|
(a) | Documents filed as part of this Report | |
|
1. | All Financial Statements | |
The financial statements and
notes are included herein under [Part II-Item 8. Financial Statements and Supplementary Data](#k_014).
**INDEX TO FINANCIAL STATEMENTS**
|
|
|
| |
|
|
| |
|
|
Report of Independent Registered Public Accounting Firm |
28 | |
|
|
Balance Sheets as of June 30, 2025 and 2024 |
29 | |
|
|
Statements of Operations for the years ended June 30, 2025 and 2024 |
30 | |
|
|
Statements of Stockholders Equity for the years ended June 30, 2025 and 2024 |
31 | |
|
|
Statements of Cash Flows for the years ended June 30, 2025 and 2024 |
32 | |
|
|
Notes to the Financial Statements |
33 | |
|
2. | Financial Statement Schedules | |
All schedules are omitted
because they are inapplicable or not required or the required information is shown in the financial statements or notes thereto.
| | 45 | | |
|
3. | Exhibits required by Item 601 of Regulation S-K | |
****
|
Exhibit No. |
|
Exhibit Description | |
|
3.1
|
|
Amended and Restated Articles of Incorporation of NeoVolta, Inc. (incorporated by reference to exhibit 2.1 of the Companys Form 1-A (file no. 024-10942)). | |
|
3.2
|
|
Second Amended and Restated Bylaws of NeoVolta, Inc. (incorporated by reference to exhibit 3.3 of the Companys Form S-1 (file no. 333-264275)). | |
|
4.1 |
|
Form of Common Stock Purchase Warrant issued in July 2022 offering (incorporated by reference to exhibit 4.3 of the Companys Form S-1 (file no. 333-264275)). | |
|
4.2 |
|
Form of Warrant Agent Agreement dated July 27, 2022 (incorporated by reference to exhibit 4.4 of the Companys Form S-1 (file no. 333-264275)). | |
|
4.3 |
|
Description of the Companys Securities (incorporated by reference to exhibit 4.6 to the Companys Form 10-K filed September 27, 2022). | |
|
10.1
|
|
NeoVolta, Inc. 2019 Stock Plan (as amended and restated) (incorporated by reference to exhibit 10.1 of the Companys Form 8-K filed December 10, 2024) | |
|
10.2+ |
|
Amended and Restated Employment Agreement between NeoVolta, Inc. and Steve Bond dated February 4, 2025 (incorporated by reference to exhibit 10.2 of the Companys Form 10-Q filed February 7, 2025) | |
|
10.3**++ |
|
Distribution Agreement, dated as of October 7, 2019, between NeoVolta, Inc. and PMP Energy, LLC (incorporated by reference to exhibit 10.7 of the Companys Form S-1 (file no. 333-264275)). | |
|
10.4**++ |
|
Exclusive Supply Agreement, effective as of August 30, 2021, by and between NeoVolta, Inc. and NingBo Deye Inverter Technology Co, Ltd. (incorporated by reference to exhibit 10.8 of the Companys Form S-1 (file no. 333-264275)). | |
|
10.5+ |
|
Independent Director Agreement, dated April 11, 2022, by and between NeoVolta, Inc. and Susan Snow (incorporated by reference to exhibit 10.10 of the Companys Form S-1 (file no. 333-264275)). | |
|
10.6+ |
|
Independent Director Agreement, dated April 7, 2022, by and between NeoVolta, Inc. and John Hass (incorporated by reference to exhibit 10.11 of the Companys Form S-1 (file no. 333-264275)). | |
|
10.7+ |
|
Form of Amendment to Independent Director Agreement, dated November 4, 2022, by and between NeoVolta, Inc. and each of John Hass and Susan Snow (incorporated by reference to exhibit 10.13 to the Companys Form 10-Q filed November 10, 2022) | |
|
10.8+ |
|
Employment Agreement between NeoVolta, Inc. and Ardes Johnson dated April 19, 2024 (incorporated by reference to exhibit 10.1 to the Companys Form 8-K filed April 24, 2024) | |
|
10.9 |
|
Line of Credit Agreement between NeoVolta, Inc. and National Energy Modelers, Inc., dated September 3, 2024 (incorporated by reference to exhibit 10.1 to the Companys Form 8-K filed September 4, 2024) | |
|
19.1 |
|
Insider Trading Policy (incorporated by reference to exhibit 19.1 to the Companys Form 10-K filed September 27, 2024) | |
|
23.1* |
|
Consent of MaloneBailey, LLP. | |
|
31.1* |
|
Certification of Principal Executive Officer Pursuant to Section 302 of Sarbanes- Oxley Act of 2002 | |
|
31.2* |
|
Certification of Principal Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002 | |
|
32.1* |
|
Certification of Principal Executive Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
|
32.2* |
|
Certification of Principal Financial Officer Pursuant to Section 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
|
97.1 |
|
NeoVolta, Inc. Restatement Recoupment Policy (incorporated by reference to exhibit 97.1 to the Companys Form 10-K filed September 27, 2024) | |
|
101.INS * |
|
Inline XBRL Instance Document | |
|
101.SCH * |
|
Inline XBRL Taxonomy Extension Schema Document | |
|
101.CAL * |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document | |
|
101.DEF * |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document | |
|
101.LAB * |
|
Inline XBRL Taxonomy Extension Label Linkbase Document | |
|
101.PRE * |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document | |
|
104 |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |
+ Management contract or compensatory plan or arrangement.
* Filed herewith.
** Previously filed.
++Pursuant to Item 601(b)(10)(iv) of Regulation S-K promulgated
by the SEC, certain portions of this exhibit have been redacted. The Company hereby agrees to furnish supplementally to the SEC, upon
its request, an unredacted copy of this exhibit.
****
****
ITEM 16. FORM 10-K SUMMARY.
****
None.
****
****
****
| | 46 | | |
****
**SIGNATURES**
Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
|
|
NEOVOLTA, INC. | |
|
|
|
| |
|
|
By: |
/s/ Ardes Johnson | |
|
|
|
Ardes Johnson | |
|
|
|
Chief Executive Officer
(Principal Executive Officer)
| |
Date: September 29, 2025
Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant in the capacities
and on the dates indicated.
|
Signature |
|
Title |
|
Date | |
|
|
|
|
|
| |
|
/s/ Ardes Johnson |
|
Chief Executive Officer and Director |
|
September 29, 2025 | |
|
Ardes Johnson |
|
(Principal Executive Officer) |
|
| |
|
|
|
|
|
| |
|
/s/ Steve Bond |
|
Chief Financial Officer and Director |
|
September 29, 2025 | |
|
Steve Bond |
|
(Principal Financial & Accounting Officer) |
|
| |
|
|
|
|
|
| |
|
/s/ Chandler Weeks |
|
Director |
|
September 29, 2025 | |
|
Chandler Weeks |
|
|
|
| |
****
|
/s/ Susan Snow |
|
Director |
|
September 29, 2025 | |
|
Susan Snow |
|
|
|
| |
|
|
|
|
|
| |
|
/s/ John Hass |
|
Director |
|
September 29, 2025 | |
|
John Hass |
|
|
|
| |
****
****
****
****
****
****
| | 47 | | |
****