If our initial business combination is not approved or completed for any reason, then our public stockholders who elected to exercise their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account. In such case, we will promptly return any certificates delivered by public holders who elected to redeem their shares.

~~If our initial proposed business combination is not completed, we may continue to try to complete a business combination by February 8, 2023 or during any Extension Period.~~

~~Redemption of public shares and liquidation if no initial business combination~~

Our amended and restated certificate of incorporation provides that we will have only until February 8, 2023 to complete our initial business combination. If we have not completed our initial business combination within such period or during any Extension Period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the prescribed time period.

Our initial stockholders, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares and held by them if we fail to complete our initial business combination within the prescribed time period. However, if our initial stockholdersAnnual Report or any of our officers, directors or any of their respective affiliates then hold any public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted time frame to complete our initial business combination.

Our initial stockholders, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combinationother securities filings unless specifically incorporated herein by February 8, 2023 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions.

We expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be funded from amounts remaining out of the estimated $1,000,000 of proceeds held outside the trust account, although we cannot assure you that there will be sufficient funds for such purpose. However, if those funds are not sufficient to cover the costs and expenses associated with implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay taxes, we may request the trustee to release to us an additional amount of up to $100,000 of such accrued interest to pay those costs and expenses.

If we were to expend all of funds held outside of the trust account, and without taking into account interest, if any, earned on the trust account and any tax payments or expenses for the dissolution of the trust, the per-share redemption amount received by stockholders upon our dissolution would be $10.00. The proceeds held in the trust account could, however, become subject to the claims of our creditors which would have higher priority than the claims of our public stockholders. We cannot assure you that the actual per-share redemption amount received by stockholders will not be substantially less than $10.00. Please see “Risk Factors — If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors described above. Under Section 281(b) of the DGCL, our plan of dissolution must provide for all claims against us to be paid in full or make provision for payments to be made in full, as applicable, if there are sufficient assets. These claims must be paid or provided for before we make any distribution of our remaining assets to our stockholders. While we intend to pay such amounts, if any, we cannot assure you that we will have funds sufficient to pay or provide for all creditors’ claims.

reference.

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Although we have sought and will continue to seek to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where we are unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. In order to protect the amounts held in the trust account, V Donargo LLC, an entity controlled by Vincent Donargo, our Chief Financial Officer, has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriter of the IPO against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, V Donargo LLC will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether V Donargo LLC has sufficient funds to satisfy its indemnity obligations and believe that its only assets are stock of our company. Therefore, V Donargo LLC may not be able to satisfy those obligations. We have not asked V Donargo LLC to reserve for such obligations. Therefore, we cannot assure you that it would be able to satisfy those obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.00 per public share. In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

In the event that the proceeds held in the trust account are reduced below: (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, and V Donargo LLC asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against V Donargo LLC to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against V Donargo LLC to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in certain instances. For example, the cost of such legal action may be deemed by the independent directors to be too high relative to the amount recoverable or the independent directors may determine that a favorable outcome is not likely. Accordingly, we cannot assure you that due to claims of creditors the actual value of the per-share redemption price will not be substantially less than $10.00 per public share. Please see “Risk Factors — If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors described above.

We will seek to reduce the possibility that V Donargo LLC will have to indemnify the trust account due to claims of creditors by endeavoring to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to monies held in the trust account. V Donargo LLC will also not be liable as to any claims under our indemnity of the underwriter of the IPO against certain liabilities, including liabilities under the Securities Act. We have access to funds held outside of the trust account, which were $396,295 as of December 31, 2021 with which to pay any such potential claims (including costs and expenses incurred in connection with our liquidation, currently estimated to be no more than approximately $100,000). In the event that we liquidate and it is subsequently determined that the reserve for claims and liabilities is insufficient, stockholders who received funds from our trust account could be liable for claims made by creditors.

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Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within the required time period may be considered a liquidating distribution under Delaware law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution.

Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within the required time period, is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution. If we have not completed our initial business combination by February 8, 2023 or during any Extension Period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Accordingly, it is our intention to redeem our public shares as soon as reasonably possible following the end of our acquisition period and, therefore, we do not intend to comply with those procedures. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of such date.

Because we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the subsequent ten years. However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. As described above, pursuant to the obligation contained in our underwriting agreement, we will seek to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account.

As a result of this obligation, the claims that could be made against us are significantly limited and the likelihood that any claim that would result in any liability extending to the trust account is remote. Further, V Donargo LLC may be liable only to the extent necessary to ensure that the amounts in the trust account are not reduced below: (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriter of the IPO against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, V Donargo LLC will not be responsible to the extent of any liability for such third-party claims.

If we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, we cannot assure you we will be able to return $10.00 per share to our public stockholders. Additionally, if we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing itself and our company to claims of punitive damages, by paying public stockholders from the trust account prior to

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addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. Please see “Risk Factors — If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages.”

A public stockholder will be entitled to receive funds from the trust account only upon the earliest to occur of: (1) the completion of our initial business combination and then, only in connection with those public shares that such stockholder has properly elected to redeem, subject to the limitations set forth in the warrant agreement and described in this annual report; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 8, 2021 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we have not completed our initial business combination by February 8, 2023, subject to applicable law. In no other circumstances will a public stockholder have any right or interest of any kind to or in the trust account. In the event we seek stockholder approval in connection with our initial business combination, a stockholder’s voting in connection with our initial business combination alone will not result in a stockholder’s redeeming its shares to us for an applicable pro rata share of the trust account. Such stockholder must have also exercised its redemption rights described above. Holders of warrants will not have any rights of proceeds held in the trust account with respect to the warrants.

~~Amended and Restated Certificate of Incorporation~~

Our amended and restated certificate of incorporation contains certain requirements and restrictions that will apply to us until the consummation of our initial business combination. If we seek to amend any provisions of our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 8, 2023 or (B) with respect to any other provision relating to stockholders’ rights or pre- initial business combination activity, we will provide public stockholders with the opportunity to redeem their public shares in connection with any such vote. Our initial stockholders, officers and directors have agreed to waive any redemption rights with respect to any founder shares and any public shares held by them in connection with any such amendment. Specifically, our amended and restated certificate of incorporation provides, among other things, that:

●prior to the consummation of our initial business combination, we shall either: (1) seek stockholder approval of our initial business combination at a meeting called for such purpose, in connection with which, stockholders may seek to redeem their shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed transaction, into their pro rata share of the aggregate amount then on deposit in the trust account, calculated as of two business days prior to the completion of our initial business combination, including interest (which interest shall be net of taxes payable); or (2) provide our public stockholders with the opportunity to tender their shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account, calculated as of two business days prior to the completion of our initial business combination, including interest (which interest shall be net of taxes payable), in each case subject to the limitations described herein;

●we will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation and, solely if we seek stockholder approval, a majority of the outstanding shares of our common stock voted are voted in favor of the business combination at a duly held stockholders meeting;

●if we have not completed our initial business combination by February 23, 2023, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law; and

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●prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (1) receive funds from the trust account or (2) vote pursuant to our amended and restated certificate of incorporation on any initial business combination or any amendments to our amended and restated certificate of incorporation.

~~These provisions cannot be amended without the approval of holders of at least 65% of our outstanding common stock.~~

Additionally, our amended and restated certificate of incorporation provides that, prior to our initial business combination, only holders of our Class B common stock have the right to vote on the election of directors and that holders of a majority of the outstanding shares of our Class B common stock may remove a member of the board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended if approved by holders of a majority of at least 90% of the outstanding shares of our common stock voting at a stockholder meeting.

Unless specified in our amended and restated certificate of incorporation or bylaws, or as required by applicable law or stock exchange rules, the affirmative vote of holders of a majority of the outstanding shares of our common stock that are voted is required to approve any such matter voted on by our stockholders.

~~Competition~~

Many of these individuals and entities are well-established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there will be numerous target businesses we could potentially acquire with the proceeds held in the trust account and the sale of the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. Our initial stockholders or any of their affiliates may make additional investments in us, although our they have no obligation or other duty to do so. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, our obligation to pay cash in connection with our public stockholders who exercise their redemption rights may reduce the resources available to us for our initial business combination and our outstanding warrants, and the future dilution they potentially represent, may not be viewed favorably by target businesses. Any of these factors may place us at a competitive disadvantage in successfully negotiating and completing an initial business combination.

~~Employees~~

We currently have two officers and do not intend to have any full-time employees prior to the completion of our initial business combination. Members of our management team are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination. The amount of time that any such person will devote in any time period to our company will vary based on whether a target business has been selected for our initial business combination and the current stage of the business combination process.

~~Emerging Growth Company Status~~

We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes- Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.

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In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.

We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) of 2026, (b) in which we have total annual gross revenue of at least $1.07 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 million as of the end of that year’s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to “emerging growth company” shall have the meaning associated with it in the JOBS Act.

Additionally, we are a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of that year’s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the end of that year’s second fiscal quarter.

Item 1A. Risk ~~Factors.~~

~~An investment in our securities involves~~Factors

Certain factors may have a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this annual report before making a decision to invest in our securities. If any of the following events occur,material adverse effect on our business, financial condition, results of operations, and ~~operating~~prospects. You should carefully consider the risks and uncertainties described below, as well as the other information in this Annual Report, including our consolidated financial statements and the related notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The occurrence of any of the events or developments described below, or of additional risks and uncertainties not presently known to us or that we currently deem immaterial, could materially and adversely affect our business, results ~~may be materially adversely affected.~~of operations, financial condition, and prospects. In ~~that~~such an event, the ~~trading~~market price of our securities could decline, and you could lose all or part of your investment.

~~In addition~~

Risk Factor Summary

Below is a summary of the principal factors that make an investment in our common stock speculative or subject to risk. This summary does not address all of the risks facing our business. You should consider the risks in this summary together with the detailed discussion of risks that immediately follows this summary in this section titled “Risk Factors,” as well as the other information in this Annual Report on Form 10-K.

•Our limited operating history and our rapidly evolving industry make it difficult to evaluate our business, the risks and ~~uncertainties set forth below,~~challenges we may face, ~~certain material~~and future prospects.

•The engineering of our systems is in continuous refinement to improve system cost and efficiency. There is no guarantee that we will be successful in implementing all improvements under the expected schedule.

•Our GESSs are based on established principles that are deployed in a novel way to create new technologies to store energy and potential customers may be hesitant to make a significant investment in our technology or abandon the technology they are currently using.

•Our systems’ performance may not meet our customers’ expectations or needs.

•There is no assurance that non-binding letters of intent and other indications of interest, including awards, submitted proposals or short-lists, will result in binding orders or sales. Customers may cancel or delay the non-binding letters of intent and other indications of interest in our sales pipeline. As a result, our operating results and cash flows may be materially lower than our expected results of operations.

•The failure or inability of our suppliers to deliver necessary components or raw materials for construction of our energy storage systems and their failure or inability to deliver them in a timely manner could cause installation delays, cancellations, penalty payments and damage to our reputation.

•Our business is subject to risks associated with construction, cost overruns and ~~uncertainties~~delays, including those related to ~~the business combination with Energy Vault. In addition, if we succeed in effecting the proposed business combination, we will face additional~~obtaining government permits and ~~different risks~~approvals, electrical interconnection, and ~~uncertainties related to the business of Energy Vault. Such material risks will be set forth~~other contingencies that may arise in the ~~Registration Statement on Form S-4, as amended, and the proxy statement/prospectus that we filed with the SEC in connection with the meeting to be called to approve the proposed business combination.~~

~~Risks Relating to Business Operations, Our Search for, and Consummation~~course of ~~or Inability to Consummate, a Business Combination~~

completing installations.

~~We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.~~•

~~We are a newly incorporated company with no operating results. To date, our only activities have been related to our formation and the IPO and the search and~~During an evaluation of potential targets in contemplation of a business combination. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective of completing our initial business combination with one or more target businesses. We have no plans, arrangements or understandings with any prospective target business concerning a business combination and may be unable to complete our initial business combination. If we fail to complete our initial business combination, we will never generate any operating revenues.

~~Our independent registered public accounting firm’s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a “going concern.”~~

~~As of December 31, 2021, we had $396,295 in cash held outside of~~ the ~~trust account and a working capital of $317,788. Further, we have incurred and expect to continue to incur significant costs in pursuit~~effectiveness of our ~~finance and acquisition plans. The Company’s business plan is dependent on the completion of a business combination and the Company’s cash and working capital~~internal control over financial reporting as of December 31, 2021 are not sufficient to complete its planned activities. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. We cannot assure you that we will consummate an initial business combination or that we will have sufficient cash available to allow us to complete our initial business combination.

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We2022, management identified a material weakness in our internal control over financial ~~reporting as of September 30, 2021 and as of March 31, 2021.~~reporting. If we continue to fail to maintain proper and effective internal controls over financial reporting or are unable to ~~develop and maintain an effective system of~~remediate the material weakness in our internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, and investors’ views of us could be harmed.

•We are an early stage company with a history of losses, and expect to incur significant expenses and continuing losses for the foreseeable future, and we may not be able to ~~accurately report~~achieve profitability in the future.

•Our total backlog and bookings may not be indicative of our future revenue, which could have a material adverse impact on our business, financial condition, and results of operations.

•Our energy storage systems involve a lengthy sales and installation cycle, and if we fail to close sales on a regular and timely basis it could harm our business. Moreover, the long sales cycles for our energy storage systems may cause us to incur significant expenses without offsetting revenues.

•Our systems include complex software and technology systems and do not have a meaningful history of operation, and there can be no assurance such systems and technology will perform as expected or that software, engineering or other technical defects will not be discovered until after a system is installed and operated by a customer. If our energy storage systems contain manufacturing or construction defects, our business and financial results could be harmed. In addition, the development and updating of these systems will require us to incur potentially significant costs and expenses.

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•If any of our products are or are alleged to be defective in design or manufacturing or experience other failures, we may be compelled to undertake corrective actions, which could adversely affect our business, prospects, operating results, reputation and financial condition.

•Our business is subject to risks associated with construction, cost overruns and delays, including those related to obtaining government permits and approvals, electrical interconnection, and other contingencies that may arise in the course of completing installations.

Risks Related to Our Business and Our Industry

Our limited operating history and our rapidly evolving industry make it difficult to evaluate our business, the risks and challenges we may face and future prospects.

From our inception in October 2017 through the first half of 2022, we focused principally on developing and proving our fundamental gravity energy storage technology, including our GESS, which we are seeking to further refine and commercialize. Beginning in 2022, we expanded our offerings to include BESSs and gHESSs. We have built only one GESS to date, the EV1 Tower in Lugano, Switzerland (the “CDU”), which served as a commercial demonstration unit until its decommissioning in September 2022. We have not fully deployed any other systems as of the date of this Annual Report, although we have signed contracts to deliver BESSs and to own and operate through a tolling arrangement a green hydrogen plus battery energy storage system (further described in “Recent Developments” within Management’s Discussion and Analysis section). As a result, we have a limited history operating our business and constructing energy storage systems, and therefore a limited history upon which you can base an investment decision.

Our future growth in a nascent and rapidly-evolving industry is dependent on a number of factors, including rising demand for clean electric power solutions that can provide electric power with lower carbon emissions and replacement of conventional generation sources and the adoption speed of digital software applications to modernize the efficiency of power assets and the electric grid. Among other renewable energy market trends, we expect our business results to be driven by declines in the cost of generation of renewable power, decreases in the cost of manufacturing battery modules and cells, customer needs for services and digital applications, commercial, legal, regulatory, and political pressure for the reduced use of and reliance on fossil fuels and electric power generation that relies on fossil or other non-renewable fuels, and a rapidly growing energy storage market driven by increasing demand from utilities, independent power producers, and large energy users. However, predicting future revenues and appropriately forecasting and budgeting for our expenses is difficult, and we have limited operating history to predict trends that may ~~adversely affect investor confidence in us~~emerge and take hold and materially affect our business. In particular, global inflationary pressures in the last year have disrupted the historical trend of declining renewable energy costs and declining battery costs, and it is unclear when, or if, our market segment will return to the historical trend of declining costs. Our future operations and strategy is therefore subject to all of the risks inherent in light of the expenses, difficulties, complications and delays frequently encountered in connection with the growth of any new business in a nascent industry, as well as those that are specific to our business in particular.

We have experienced rapid internal growth and expect to invest in our growth for the foreseeable future. If we fail to manage our growth effectively, our business and operating results may suffer.

In recent periods, our internal operations have grown in terms of complexity and the number of our employees, and we intend to continue such investment for the foreseeable future. The growth and expansion of our business has placed and continues to place a strain on management, operations, financial infrastructure, and corporate culture. In the event of further growth, our information technology systems and our internal control over financial reporting and procedures may not be adequate to support our operations and may introduce opportunities for data security incidents that may interrupt business operations and permit bad actors to obtain unauthorized access to business information or misappropriate funds. We may also face risks to the extent such bad actors infiltrate the information technology infrastructure of our contractors.

To manage growth in operations and personnel, we will need to continue to improve our operational, financial and management controls and reporting systems and procedures. Failure to manage growth effectively could result in difficulty or delays in attracting customers, declines in quality or customer satisfaction, increases in costs, difficulties in introducing new products and services or enhancing existing products and services, loss of customers, information security vulnerabilities or other operational difficulties, any of which could adversely affect our business and ~~operating results.~~results of operations.

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Our projections are subject to significant risks, assumptions, estimates and uncertainties. As a result, our projected revenues, market share, expenses and profitability may differ materially from our expectations.

Our projections are subject to significant risks, assumptions, estimates and uncertainties. Such projections reflect our current views with respect to future events or our future financial performance, are based on assumptions, and involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by our projections. We may not actually achieve the plans, expectations or objectives contained in our projections, and the underlying assumptions may prove incorrect. Such deviations may be due to factors outside our control or currently unknown to us. For example, our actual revenues, market share, timing for achieving business milestones, expenses and profitability may differ materially from our expectations. Therefore, undue reliance should not be placed on any of our projections.

Our business model depends on acceptance of our technology by our customers, retaining existing customers, and the success of our business model .

As a recent market entrant in a developing industry, our results of operations and financial condition are dependent upon our success in establishing or entering new markets, developing and commercializing our energy storage systems, and undertaking marketing activities. We face significant risks associated with our business strategy of targeting utilities, independent power producers, and large energy users and deploying our energy storage system systems at a scale that leads to broad market acceptance and profitability. Furthermore, during 2022, we expanded our offering to include not only GESSs, but also BESSs and gHESS offerings. The relative success of these systems will be dependent upon a number of factors, including their ability to provide our customers with reliable and dependable energy storage for the durations that they require, while still being cost-effective.

We depend on a limited number of customers for the majority of our revenue, and the loss of any one of these customers could substantially reduce our revenue and impact our liquidity.

The loss of any significant customers or partners or reduction in our business activities could cause our revenues to decrease significantly and increase our losses from operations. If our products are not successful and we cannot broaden our customer base, we will continue to depend on a few customers for the majority of our revenues. Additionally, if we are unable to negotiate favorable business terms with these customers in the future, our revenues and gross profits may be insufficient to allow us to achieve and/or sustain profitability, continue operations, or remain a going concern.

The engineering of our systems is in continuous refinement to improve system cost and efficiency. There is no guarantee that we will be successful in implementing all improvements under the expected schedule.

Our business depends on our ability to succeed in implementing our energy storage systems and introduce innovative and competitive energy storage technologies. As of the date of this Annual Report, we have not deployed a fully operational energy storage system. As our energy storage systems are highly complex, this process is costly and time-consuming.

Any future full energy storage deployments may incur more costs than we expect. Our business, reputation, results of operations and financial condition may be materially adversely affected if we do not successfully implement our systems or to the extent that such implementation occurs later or costs more than we expect. Examples of costs that we cannot control include the costs of electronics due to global allocation shortages or costs associated with construction delays.

If we are not able to reduce our cost structure in the future, our ability to become profitable may be impaired.

Over time, we must effectively manage the manufacturing costs for our energy storage systems to expand our market. While we have sought, and will continue to seek, to manage our manufacturing and services costs, the cost of components and raw materials, for example, could increase in the future. Any such increases could slow our growth and cause our financial results and operational metrics to suffer. In addition, we may face increases in our other expenses, including increases in wages or other labor costs, as well as installation, marketing, sales or related costs. We may continue to make significant investments to drive growth in the future. To the extent that the price of electricity from the grid is low in certain markets, we will need to continue to reduce our costs to maintain our expected margins in those markets. Increases in any of these costs or our failure to achieve projected cost reductions could adversely affect our results of operations and financial condition and harm our business and prospects. If we are unable to reduce our cost structure sufficiently in the future, we may not be able to achieve profitability, which could have a material adverse effect on our business and prospects.

Operational costs can be difficult to predict and may include costs from requirements related to the decommissioning of our systems.

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We rely heavily on complex machinery for our operations and our production involves a significant degree of uncertainty and risk in terms of operational performance and costs. When fully operational, our energy storage systems will consist of large-scale machinery comprised of many components assembled on-site for our customers. The components of our energy storage systems are likely to suffer unexpected malfunctions from time to time and will depend on repairs and spare parts to resume operations, which may not be available when needed. Unexpected malfunctions of our energy storage systems or their constituent components may significantly affect the intended operational efficiency and performance. In addition, our energy storage systems may need to be decommissioned from time to time, and the related costs could be significant given the expected size and complexity of our energy storage systems. Operational performance and costs, including those related to project stoppage, can be difficult to predict and are often influenced by factors outside of our control, such as, but not limited to, scarcity of natural resources, environmental hazards and remediation, costs associated with construction, commissioning, testing or decommissioning of machines, labor disputes and strikes, difficulty or delays in obtaining governmental permits, damages or defects in electronic systems, industrial accidents, fire, seismic activity and natural disasters. Should operational risks materialize, it may result in the personal injury to or death of workers, the loss of production equipment, damage to manufacturing facilities, monetary losses, delays and unanticipated fluctuations in production, environmental damage, administrative fines, increased insurance costs and potential legal liabilities, all which could have a material adverse effect on our business, results of operations, cash flows, financial condition or prospects.

Our energy storage systems have significant upfront costs, and our customers may need to obtain financing to help finance purchases. If our customers are unable to procure third-party financing or if the cost of such financing exceeds our estimates, our business would be adversely affected.

Our energy storage systems have significant upfront costs, and certain customers may need, or may prefer to acquire, third-party financing to purchase our systems.

Therefore, our growth, including the deployment of our energy storage systems, may to an extent depend on our customers’ ability to attract third-party financing partners. Their ability to obtain third-party financing depends on many factors that are outside of our control, including the ability of third parties to utilize tax credits and other government incentives, interest rate and/or currency exchange fluctuations, their perceived creditworthiness and the condition of credit markets generally. We expect that the financing of customer purchases of our energy storage systems will be subject to customary conditions such as the customer’s credit quality, and if these conditions are not satisfied, such customers may be unable to finance purchases of our energy storage systems, which would have an adverse effect on our revenue in a particular period. To the extent our customers are unable to arrange future financings for any of our current or potential projects, our business would be negatively impacted.

In attempting to attract new customers to support our growth, we intend to refine our customer agreements based on experience. Moreover, new types of product offerings may require our customers to find partners willing to finance these new projects, which may have different terms and financing conditions from prior transactions. If the terms of these transactions or the structure of these projects fails to attract financiers, we may not be able to proceed with growing our business and our potential for growth may be limited. Additionally, financing options are also limited by the customer’s willingness to commit to making fixed payments regardless of the performance of the energy storage systems or our performance of our obligations under the customer agreement

Further, our sales process for transactions that require financing require that we and our customers make certain assumptions regarding the cost of financing capital. If the cost of financing ultimately exceeds our estimates, we may be unable to proceed with some or all of the impacted projects or our revenue from such projects may be less than our estimates. Actual financing costs for potential customers may vary from our estimates due to factors outside of our control, including changes in customer creditworthiness, macroeconomic factors, the returns offered by other investment opportunities available to our financing partners, and other factors.

If our customers are unable to procure financing partners willing to finance deployments of our products or if the cost of such financing exceeds our estimates, our business would be negatively impacted.

The economic benefit of our energy storage systems to our customers depends on the cost of electricity available from alternative sources, including local electric utility companies, which cost structure is subject to change.

The economic benefit of our energy storage systems to our customers includes, among other things, the benefit of reducing such customer’s payments to the local electric utility company. The rates at which electricity is available from a customer’s local electric utility company is subject to change and any changes in such rates may affect the relative benefits of our energy storage systems. Further, the local electric utility may impose “departing load,” “standby” or other charges on our customers in connection with ~~Novus’ IPO, Novus accounted~~their acquisition of our energy storage systems, the amounts of which are outside of our control and which may have a material impact on the economic benefit of our energy storage systems to our customers. Changes in the rates offered by local electric utilities and/or in the applicability or amounts of charges and other fees

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imposed by such utilities on customers acquiring our energy storage systems could adversely affect the demand for our energy storage systems.

Additionally, the electricity stored and released by our systems may not currently be cost-competitive in some geographic markets, and we may be unable to reduce our costs to a level at which our energy storage systems would be competitive in such markets. As such, unless the cost of electricity in these markets rises or we are able to generate demand for our energy storage systems based on benefits other than electricity cost savings, our potential for growth may be limited.

Our GESSs are based on established principles that are deployed in a novel way to create new technologies to store energy and potential customers may be hesitant to make a significant investment in our technology or abandon the technology they are currently using.

The design of our GESSs are based on established principles that are deployed in a novel way; the GESSs are intended to provide longer energy storage durations than are provided by other types of energy storage systems. We believe that the continued growth and acceptance of energy storage generally will depend significantly on continued investment by the public and private sectors in the renewable energy industry, the regulatory environment focused on transitioning away from carbon-intensive power generation and the speed of transition towards electric mobility.

The adoption of renewable energy may not proceed as quickly as (or at the levels that) we expect and may be influenced by changes in regulatory environments, including incentives, fuel prices, public policy concerns and other factors beyond our control. Additionally, potential customers who previously invested in alternatives to our GESS solution may not deem a transition to our existing or future GESS solutions to be cost-effective. Moreover, given the limited history of our GESS technology, potential customers may be hesitant to make a significant investment in our products. Our business, results of operations, financial condition and prospects could be adversely affected to the extent that customers, for any reason, do not adopt our systems or migrate to our systems from another energy storage technology.

Our energy storage systems’ performance may not meet our customers’ expectations or needs.

Our energy storage systems will be subject to various operating risks that may cause them to generate less value for our customers than expected. These risks include a failure or wearing out of our equipment or the equipment that our equipment connects into, an inability to find suitable replacement equipment or parts, or disruption in our distribution systems. Any extended interruption or failure of our customer’s projects, including systems we operate under long term service agreements, for any reason to generate the expected amount of output could adversely affect our business, financial condition and results of operations. In addition, our customers’ willingness to acquire additional systems or services from us may be impacted in the future if any of our systems incur operational issues that indicate expected future cash flows from the system are less than the carrying value. Any such outcome could adversely affect our operating results or ability to attract new customers.

If our estimates of the useful life for our energy storage systems are inaccurate or we do not meet service and warranties and performance guarantees, our business and financial results could be adversely affected.

We expect to provide warranties and performance guarantees of our systems. To date, we have only deployed our CDU, and we have not deployed any fully operational energy storage systems, and our estimates about product performance and life may prove to be incorrect. Failure to meet these warranties and performance guarantee levels may require the purchase price to be adjusted downward based on agreed-upon performance targets, or require us to make cash payments to the customer based on actual performance, as compared to expected performance.

Through Energy Vault Solutions, we intend to continue exploring, the potential for offering, as a standalone product, a digital platform that helps energy storage businesses make decisions on optimizing their systems bidding and dispatch. We are in the developmental phase of such a digital platform, and there is no assurance that a market for such a digital platform exits or that it would be as beneficial to our customers as we expect.

Through Energy Vault Solutions, we are in the development stage of exploring the potential for offering as a standalone product, a digital platform that could help energy storage businesses optimize their systems bidding and dispatch. We have begun developing this platform and we intend to continue this exploration. Even after we spend time and resources to develop such a digital platform and to explore the market potential for such a digital platform, there is no assurance that we will develop a product that can be sold on terms that are commercially acceptable to us. Moreover, even if we develop the digital platform and enter into sales agreements for it, these agreements may not be as beneficial to us as we expected at the time of entering into the underlying agreement. Any of the foregoing may adversely affect our business, financial condition, results or operations and prospects.

We intend to explore alternative, co-active use case opportunities for our systems, but there is no assurance that such opportunities exist or that they would be as beneficial to us as we expect.

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We intend to explore alternative, co-active use case opportunities for our energy storage systems. For example, we intend to explore opportunities in energy-intensive industries such as vertical farming, data centers, direct air carbon capture where our systems may be able to benefit from existing infrastructure, including physical enclosures and electrical systems, that are built into the designs for our energy storage systems. Even after we spend time and resources exploring such opportunities, there is no assurance that they exist on terms that are commercially acceptable to us. Moreover, even if we enter into agreements to make use of such opportunities, such opportunities may not be as beneficial to us as we expected at the time of entering into the underlying agreement. Any of the foregoing may adversely affect our business, financial condition, results or operations and prospects.

There is no assurance that non-binding letters of intent and other indications of interest, including awards, submitted proposals or short-lists, will result in binding orders or sales. Customers may cancel or delay the non-binding letters of intent and other indications of interest in our sales pipeline. As a result, our operating results and cash flows may be materially lower than our expected results of operations.

Our success depends on our ability to generate revenue and operate profitably, which depends in part on our ability to identify target customers and convert such contacts into meaningful orders or expand on current customer relationships. To date, we have not deployed any fully operational energy storage systems (aside from the CDU), although we are performing on customer contracts to construct energy storage systems. While our contracts do provide that our customers will be obligated to pay us certain fees in the event of termination for their convenience, such fees may not be sufficient to cover our costs and we would not realize the expected revenue associated with such cancelled contracts. Potential and contracted customers may abandon their indications of interest, or fail to honor contractual obligations and non-binding letters of interest may be cancelled or delayed by a customer for any reason or its terms may be amended in an manner adverse to us in connection with negotiating a definitive sales agreement. For that reason, there can be no assurance that any current or future indications of interest (including awards, submitted proposals or short-lists) or non-binding letters of intent will result in binding orders or sales. Furthermore, in light of our limited operating history, it is difficult for us to predict the rates at which the non-binding letters of intent or other indications of interest in our pipeline will result in binding orders or sales. It is also difficult for us to predict how quickly we will be able to fill binding orders in the event that we obtain multiple orders. In addition, revenue is expected to be recognized in stages, and customers may in some cases delay actual cash payments regardless of progressive billings. Additionally, a customer’s ability to make payments could decline during the sales process, even to the point of insolvency or bankruptcy. As a result, our operating results and cash flow may be materially lower than we expect.

Our future growth depends upon our ability to maintain relationships with third parties, and the terms and enforceability of many of these relationships are not certain.

We expect to rely on engineering, procurement, construction, or EPC, firms as third-party general contractors to install energy storage systems at our customers’ sites. We are likely to work with a limited number of such EPC firms, which may impact our ability to facilitate customer installations as planned. Our work with contractors or their sub-contractors may have the effect of our being required to comply with additional rules (including rules unique to our customers), working conditions, site remediation and other union requirements, which can add costs and complexity to an installation project. In the future, the timeliness, thoroughness and quality of installation-related services performed by our general contractors and their sub-contractors may not meet our expectations and standards and it may be difficult to find and train third-party general contractors that meet our standards at a competitive cost.

In addition, a key component of our growth strategy is to develop or expand our relationships with third parties. For example, we are investing resources in establishing strategic relationships with market players across a variety of industries, including, large renewable project developers, commercial agents, environmental organizations and unions, to generate new customers or to grow our business. These programs may not roll out as quickly as planned or produce the results we anticipated. A significant portion of our business depends on attracting new partners and retaining existing partners, and such relationships may not be predicated on enforceable agreements or any agreements at all.

We depend upon component and product manufacturing and logistical services provided by third parties, many of whom are located outside of the U.S.

A significant amount of our components, including batteries utilized in our BESS offerings, and products are manufactured in whole or in part by a few third-party manufactures. Many of these manufacturers are located outside of the U.S. and are all located within a relatively small geographic location. If a catastrophic event occurs within this area, or the social or economic conditions shift within this geography, we could experience business interruptions, delayed delivery of products, or other adverse impacts to our ongoing business. We have also outsourced much of our transportation and logistics management. While these arrangements may lower operating costs, they also reduce our direct control over production and distribution. Such diminished control could have an adverse effect on the quality or quantity of our products as well as our flexibility to respond to changing conditions. In addition, we rely on third-party manufacturers to adhere to the terms and

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conditions of the agreements in place with each party. For example, although arrangements with such manufacturers may contain provisions for warranty expense reimbursement, we may remain responsible to the customer for warranty service in the event of product defects. Any unanticipated product or warranty liability, whether pursuant to arrangements with contract manufacturers or otherwise, could adversely affect our reputation, financial condition, and operating results.

The failure or inability of our suppliers to deliver necessary components or raw materials for construction of our energy storage systems and their failure or inability to deliver them in a timely manner could cause installation delays, cancellations, penalty payments and damage to our reputation.

We rely on a limited number of third-party suppliers for some of the components and raw materials such as steel, cement, polymers and, in certain cases, coal ash waste and retired wind turbine blades, and other materials that may be of limited supply for our GESSs and batteries, inverters, enclosures, and transformers for our BESSs. If any of our suppliers fail or are unable to provide sufficient components or raw materials at the level of quality required, or if our suppliers fail or are unable to or unwilling to provide us with the contracted quantities (as we have limited or in some case no alternatives for supply), or if our suppliers cancel the contracted quantities without sufficient lead time to order the materials from another supplier, or if our suppliers fail or are unable to deliver the components or raw materials in a timely manner, then delays, cancellations, penalty payments, or damage to our reputation could occur, which could have a material adverse effect on our business and our results of operations. If we fail to develop or maintain our relationships with any of our suppliers, or if there is otherwise a shortage, lack of availability, or cancellation of the purchase of any required raw materials or components, we may be unable to manufacture our energy storage systems or such products may be available only at a higher cost or after a long delay. Additionally, there are increasing expectations in various jurisdictions that companies monitor the environmental and social performance of their suppliers, including compliance with a variety of labor practices, as well as consider a wider range of potential environmental and social matters, including the end of life considerations for products. Compliance can be costly, require us to establish or augment programs to diligence or monitor our suppliers, or to design supply chains to avoid certain regions altogether. Failure to comply with such regulations can result in fines, reputational damage, import ineligibility for our products or product components, or otherwise adversely impact our business. Current or future supply chain interruptions that could be exacerbated by global political tensions, such as the situation in Ukraine, and public health emergencies, could also negatively impact our ability to acquire necessary raw materials and components. Such delays could prevent us from delivering our energy storage systems to customers within required time frames and cause order cancellations. Developing required raw materials and constructing required components for our products are time and capital intensive. Accordingly, the number of suppliers we have for some of our components and materials is limited and, in some cases, sole sourced. We may be unable to obtain comparable components from alternative suppliers without considerable delay, expense, or at all. If our suppliers face difficulties obtaining the credit or capital necessary to expand their operations when needed, they could be unable to supply necessary raw materials and components needed to support our planned sales and services operations, which would negatively impact our sales volumes and cash flows.

Our systems often rely on interconnections to distribution and transmission facilities that are owned and operated by third parties, and as a result, are exposed to interconnection and transmission facility development and curtailment risks.

A primary potential use case for our energy storage systems involves interconnection with electric distribution and transmission facilities owned and operated by regulated utilities, and independent system operators, necessary to deliver the electricity that our energy storage systems produce. A failure or delay in the operation or development of these distribution or transmission facilities could result in a loss of revenues or breach of a contract because such a failure or delay could limit the amount of renewable electricity that our energy storage systems deliver or delay the completion of our customers’ construction projects. In addition, certain of our energy storage systems’ generation may be curtailed without compensation due to distribution and transmission limitations, reducing our revenues and impairing our ability to capitalize fully on a particular customer project’s potential. Such a failure or curtailment at levels above our expectations could adversely affect our business.

Our business is subject to risks associated with construction, cost overruns and delays, including those related to obtaining government permits and approvals, electrical interconnection, and other contingencies that may arise in the course of completing installations.

Our business is subject to risks relating to construction, cost overruns and delays. The installation and operation of our energy storage systems at a particular site is generally subject to oversight and regulation in accordance with national, state and local laws and ordinances relating to building codes, safety, environmental protection, FERC and specific Independent System Operators regulation and related matters, and typically requires obtaining and keeping in good standing various local and other governmental approvals and permits, including environmental approvals and permits, that vary by jurisdiction. In some cases, these approvals and permits require periodic renewal. It is difficult and costly to track the

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requirements of every individual authority having jurisdiction over energy storage system installations, to design our energy storage systems to comply with these varying standards, which may change over time, and for customers to obtain all applicable approvals and permits. We cannot predict whether or when all permits required for a given customer’s project will be granted or whether the conditions associated with the permits will be achievable. The denial of a permit or utility connection essential to a project or the imposition of impractical conditions would impair our customer’s ability to develop the project. In addition, we cannot predict whether the permitting process will be lengthened due to complexities and appeals. Delay in the review and permitting process for a project can impair or delay our customers’ abilities to develop that project or increase the cost so substantially that the project is no longer attractive to our customers. Furthermore, unforeseen delays in the review and permitting process could delay the timing of the installation of our energy storage systems and could therefore adversely affect the timing of the recognition of revenue related to hardware acceptance by our customer, which could adversely affect our operating results in a particular period. Delays relating to constructions may also bring about cost overruns, which could further adversely affect our business.

In addition, the successful installation of our energy storage systems is dependent upon the availability of and timely connection to the local electric grid. Before beginning construction on an energy storage system, we may be unable to obtain in a timely fashion or at all the required consent and authorization of local utilities to ensure successful interconnection to energy grids to enable the successful discharge of renewable energy to customers. Any delays in our customers’ ability to connect with utilities, delays in the performance of installation-related services or poor performance of installation-related services will have an adverse effect on our results and could cause operating results to vary materially from period to period.

The size of our GESSs may negatively impact our ability to enter into contracts with customers or obtain government permits and approvals.

Our GESSs require a considerably larger space for their deployment than comparable systems based on certain technologies such as lithium-ion technology, and this can result in a significant delay in the permitting process. In addition, the size of our GESSs may represent an impediment for deployment in denser areas or areas with restrictions on the height of buildings. And, in light of the size of our systems, we generally require hard soil or the ability to get to bedrock in order to deploy our systems. These factors may negatively impact our ability to enter into customer contracts or obtain government permits and approvals, each of which may materially affect our business.

We face additional risks to the extent that customers choose to purchase energy storage and dispatch of electricity from systems we build and in which we retain an ownership interest rather than purchase an energy storage system.

In certain circumstances we expect to enter tolling arrangements in which customers purchase the energy storage and dispatch of electricity from us while we retain an ownership interest in the system. To date, we have entered into one such tolling arrangement in respect to a battery plus green hydrogen hybrid energy storage system.

We could face additional risks when we own and operate energy storage systems, compared to when the customer owns and operates energy storage systems that we build. For example, we may need to seek equity and/or debt financing to fund the construction and operation of any energy storage systems built in connection with a project for a customer who chooses to enter into a tolling arrangement. Such financing may not be available on terms acceptable to us, if at all. Moreover, we expect that any such indebtedness would be secured by a lien on the related energy storage system, and the governing debt agreement may contain covenants imposing operating and financial restrictions on our operations. In addition, until any such debt is repaid, we may not be able to generate meaningful cash flow from the project. Moreover, the failure of our customers to make payments could trigger an event of default under such governing debt agreements, which could result in the acceleration of repayment of our outstanding indebtedness or even entitle our lender to foreclose on the collateral securing our debt. In addition, to the extent equity financing is also used, our right to receive cash flows from the project could be subordinated to the other equity investors.

Additionally, there could be a material adverse effect on our operating results and our cash flows to the extent we own and operate our energy storage systems for the benefit of customers under tolling arrangements. For example, we would not expect to receive any payments from the customer until the system is completed and expenses relating to insurance premiums, personnel, and our interest payments under debt agreements would be increased, and such increases may be material. We could also be required to provide ongoing maintenance and repair services or could face liability for any damages or injuries if the system malfunctions. Additionally, we would be subject to the risks of termination of the agreement by the customer and the inability to replace the customer would result in the system failing to generate revenue. We may also incur liabilities as a result of a performance failure or other breach of our obligations in connection with the operation of the system.

We may also be subject to additional legal and regulatory restrictions to the extent we own and operate an energy storage system, including relating to the transmission of energy. Such legal and regulatory restrictions could increase the costs of

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compliance and potentially subject us to threatened or actual litigation or administrative proceedings, each of which could have a material adverse effect on our business, operating results and financial condition.

Although we don’t expect a significant majority of our revenue to come from owning and operating energy storage systems based on our current outlook, there is no assurance that this type of revenue will not account for a significant portion of our business in the future.

Increasing attention to, and scrutiny of, ESG matters could increase our costs, harm our reputation, impact our share price or access to or cost of capital, or otherwise adversely impact our business.

Companies across industries are facing increasing scrutiny from a variety of stakeholders related to their ESG and sustainability practices. Expectations regarding voluntary ESG initiatives and disclosures and consumer demand for alternative forms of energy may result in increased costs (including but not limited to increased costs related to compliance, stakeholder engagement, contracting and insurance), changes in demand for certain products, enhanced compliance or disclosure obligations, or other adverse impacts to our business, financial condition, or results of operations.

While we may at times engage in voluntary initiatives (such as voluntary disclosures, certifications, or goals, among others) to improve the ESG profile of our company or to respond to stakeholder expectations, such initiatives may be costly and may not have the desired effect. Expectations around company’s management of ESG matters continues to evolve rapidly, in many instances due to factors that are out of our control. For example, we may ultimately be unable to complete certain initiatives or targets, either on the timelines initially announced or at all, due to technological, cost, or other constraints, which may be within or outside of our control. Moreover, actions or statements that we may take based on based on expectations, assumptions, or third-party information that we currently believe to be reasonable may subsequently be determined to be erroneous or be subject to misinterpretation. If we fail to, or are perceived to fail to, comply with or advance certain ESG initiatives (including the timeline and manner in which we complete such initiatives), we may be subject to various adverse impacts, including reputational damage and potential stakeholder engagement and/or litigation, even if such initiatives are currently voluntary. For example, there have been increasing allegations of greenwashing against companies making significant ESG claims due to a variety of perceived deficiencies in performance or methodology, including as stakeholder perceptions of sustainability continue to evolve.

Certain market participants, including major institutional investors and capital providers, use third-party benchmarks and scores to assess companies’ ESG profiles in making investment or voting decisions. Unfavorable ESG ratings could lead to increased negative investor sentiment towards us, which could negatively impact our share price as well as our access to and cost of capital. To the extent ESG matters negatively impact our reputation, it may also impede our ability to compete as effectively to attract and retain employees or customers, which may adversely impact our operations. In addition, we expect there will likely be increasing levels of regulation, disclosure-related and otherwise, with respect to ESG matters. In addition, we expect there will likely be increasing levels of regulation, disclosure-related and otherwise, with respect to ESG matters. This and other stakeholder expectations will likely lead to increased costs as well as scrutiny that could heighten all of the risks identified in this risk factor. Additionally, many of our customers and suppliers may be subject to similar expectations, which may augment or create additional risks, including risks that may not be known to us.

Should we pursue acquisitions in the future, it would be subject to risks associated with acquisitions.

We may acquire additional assets, products, technologies, or businesses that are complementary to its existing business. The process of identifying and consummating acquisitions and the subsequent integration of new assets and businesses into our own business would require attention from management and could result in a diversion of resources from its existing business, which in turn could have an adverse effect on its operations. Acquired assets or businesses may not generate the expected financial results. Acquisitions could also result in the use of cash, potentially dilutive issuances of equity securities, the occurrence of goodwill impairment charges, amortization expenses for other intangible assets and exposure to potential unknown liabilities of the acquired business.

If we complete future acquisitions, we may not ultimately strengthen our competitive position or achieve our goals and business strategy. We may be subject to claims or liabilities assumed from an acquired company, product, or technology; acquisitions we complete could be viewed negatively by our customers, investors, and securities analysts; and we may incur costs and expenses necessary to address an acquired company’s failure to comply with laws and governmental rules and regulations. Additionally, we may be subject to litigation or other claims in connection with the acquired company, including claims from terminated employees, former stockholders or other third parties, which may differ from or be more significant than the risks our business faces. If we are unsuccessful at integrating future acquisitions in a timely manner, or the technologies and operations associated with such acquisitions, our revenue and operating results could be adversely affected. Any integration process may require significant time and resources, which may disrupt our ongoing business and divert management’s attention, and we may not be able to manage the integration process successfully or in a timely manner. We may not successfully evaluate or utilize the acquired technology or personnel, realize anticipated synergies

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from the acquisition, or accurately forecast the financial impact of an acquisition transaction and integration of such acquisition, including accounting charges and any potential impairment of goodwill and intangible assets recognized in connection with such acquisitions. We may have to pay cash, incur debt, or issue equity or equity-linked securities to pay for any future acquisitions, each of which could adversely affect our financial condition or the market price of our common stock. Furthermore, the sale of equity or issuance of equity-linked debt to finance any future acquisitions could result in dilution to our stockholders. The occurrence of any of these risks could harm our business, operating results, and financial condition.

Our operations are international, and expanding operations in some international markets could expose us to additional risks.

Our operations are international, and we continue to expand our business internationally as we seek to partner with customers, suppliers and other partners around the world. We currently have operations in Switzerland, and our signed purchase order and letters of intent are with counterparties around the world. Managing further international expansion will require additional resources and controls including additional support, manufacturing, and assembly facilities. Any expansion internationally could subject our business to risks associated with international operations, including:

•conformity with applicable business customs, including translation into foreign languages and associated expenses;

•lack of availability of government incentives and subsidies;

•challenges in arranging, and availability of, financing for our customers;

•potential changes to our established business model;

•cost of alternative power sources, which could be meaningfully lower outside the United States;

•availability and cost of raw materials, labor, equipment for manufacturing or assembling our energy storage systems;

•difficulties in staffing and managing foreign operations in an environment of diverse culture, laws, and customers, and the increased travel, infrastructure, and legal and compliance costs associated with international operations;

•installation challenges which we have not encountered before which may require the development of a unique model for each country;

•compliance with multiple, potentially conflicting and changing governmental laws, regulations, and permitting processes including construction, environmental, banking, employment, tax, privacy, safety, security, grid minimum performances, and data protection laws and regulations;

•compliance with U.S. and foreign anti-bribery laws including the Foreign Corrupt Practices Act and the U.K. Anti-Bribery Act;

•greater difficulties in securing or enforcing our intellectual property rights in certain jurisdictions, or greater chance potential infringement of third-party intellectual property rights in new jurisdictions;

•difficulties in funding our international operations;

•difficulties in collecting payments in foreign currencies and associated foreign currency exposure;

•restrictions on repatriation of earnings;

•compliance with potentially conflicting and changing laws of taxing jurisdictions where we conduct business and compliance with applicable U.S. tax laws as they relate to international operations, the complexity and adverse consequences of such tax laws, and potentially adverse tax consequences due to changes in such tax laws;

•increases or decreases in our expenses caused by fluctuation in foreign currency exchange rates;

•changes in import tariffs imposed by local governments;

•changes in regulations regarding the use of waste materials in our products;

•changes in regulations that would prevent us from doing business in specified countries;

•failure of the supply chain in local countries to provide us with materials of a sufficient quality and quantity delivered on timelines we expect;

•the outbreak of war or other hostilities; and

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•regional economic and political conditions.

As a result of these risks, any potential future international expansion efforts that we may undertake may not be successful.

In addition, nearly all of our letters of intent are denominated in U.S. dollars, and certain of our definitive agreements could be denominated in currencies other than the U.S. dollar. A strengthening of the U.S. dollar could increase the cost of our solutions to our international customers, which could adversely affect our business and results of operations. In addition, if an increased portion of our operating expenses is incurred outside the United States and is denominated in foreign currencies, we would be subject to increased financial impacts resulting from fluctuations in foreign currency exchange rates. If we become more exposed to currency fluctuations and are not able to successfully hedge against the risks associated with currency fluctuations, our results of operations could be adversely affected.

Our future growth is dependent upon the pace and depth of renewable energy adoption and energy storage technologies, which are emerging industries, as well as our competition. If the markets for renewable energy and energy storage do not develop as we expect, or if they develop more slowly than we expect, our business, prospects, financial condition and operating results could be adversely affected.

Our future growth depends upon factors in our industry, including with respect to our competition, the speed at which the market adopts renewable energy, our ability to penetrate such market and the state of energy storage technologies. Because renewable energy and energy storage are emerging industries, they are evolving and characterized by rapidly changing technologies, changing government regulation and industry standards and changing consumer demands and behaviors. If the markets for these do not develop as we expect, including if they develop more slowly than we expect, demand for our energy storage systems or any digital platform that we may develop, our business, prospects, financial condition and operating results could be adversely affected.

Additionally, the energy storage market is largely driven by installed capacity of renewable electricity generation and increasing demand for renewable sources of power. Since many of these renewable sources of power are intermittent, like wind and solar, the energy produced by them must be stored for use when there is demand. Should government requirements for these intermittent power sources be relaxed or social desires for lower-carbon sources of energy decline, there could be a detrimental impact on one of our primary markets.

Even if renewable energy and energy storage become more widely adopted, our energy storage technology may not achieve widespread market acceptance or may be less cost-effective as compared to competing technologies.

Our business depends on the acceptance of our products in the marketplace. Even if renewable energy and energy storage become more widely adopted than they have been to date, potential customers may choose energy storage products from our competitors that are based on their technologies. If they do so, it may be difficult to later transition such potential customers to products offered by us. Moreover, the marketplace for renewable energy storage products is rapidly evolving, and competing technologies of which we are currently unaware may emerge in the future. If the energy storage technology that supports our products does not achieve market acceptance, then our business and results of operations would be materially adversely affected.

The growth and profitability of our business is dependent upon our technology being more cost-effective than competing energy storage technologies. To the extent our offerings are not eligible for various regulatory incentives, while those of our competitors are, it may adversely impact our competitiveness or otherwise adversely impact our business.

We operate in highly competitive energy industries and there is increasing competition. Many of our competitors and future competitors may have significantly more financial and other resources than we do and if we do not compete effectively, our competitive positioning and our operating results will be harmed.

The energy markets in which we compete continue to evolve and are highly competitive. Many of our current and potential competitors are large entities at a more advanced stage in development and commercialization than we are and in some cases have significantly more financial and other resources, including larger numbers of managerial and technical personnel, to increase their market share. For example, several companies, such as ESS Inc., Eos Energy Enterprises Inc., Hydrostor Inc. and Primus Power, have each announced plans and demonstrated prototypes of products that would compete in the energy storage market, and battery vendors with whom we compete, such as Tesla, Inc., Fluence Energy, Inc., LG Chem, Ltd., Samsung Electronics Co., Ltd and Contemporary Amperex Technology Co. Limited, have already commercialized their respective energy storage solution products. Companies such as Tesla, Inc., Fluence Energy, Inc. and Wartsila Corporation are also developing their own energy management software. If our competitors continue to penetrate the renewable energy, energy storage and energy management software markets, we may experience a reduction in potential and actual market share. To date, we have focused our efforts on recruiting management and other employees, business planning, raising capital, selecting applicable third party technologies, establishing and attempting to establish

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partnerships with potential suppliers, customers and ecosystem partners, developing our gravity, battery, and green hydrogen energy storage systems, a digital platform, and general corporate development.

We expect competition in energy storage technology to intensify due to a regulatory push for lower-carbon energy sources, including intermittent sources such as wind and solar, continuing globalization, and consolidation in the energy industry. Developments in alternative technologies or improvements in energy storage technology made by competitors may materially adversely affect the sales, pricing and gross margins of our future energy storage systems and any digital platform. If a competing process or technology is developed that has superior operational or price performance, our business would be harmed.

Furthermore, our energy storage technology also competes with other emerging or evolving technologies, such as thermal storage, chemical storage, and carbon capture storage and sequestration. If we are unable to keep up with competitive developments, including if such technologies achieve lower prices or enjoy greater policy support than our technology, our competitive position and growth prospects may be harmed, which would adversely affect our business, prospects and financial condition.

Some of our current and potential competitors have longer operating histories and greater financial, technical, marketing and other resources than we do. These factors may allow our competitors to respond more quickly or efficiently than we can to new or emerging technologies. These competitors may engage in more extensive research and development efforts, undertake more far-reaching marketing campaigns and adopt more aggressive pricing policies, which may allow them to more effectively compete for new energy storage projects and energy management software customers.

We intend to continue committing significant resources to establish a competitive position. There is no assurance we will successfully identify the right partners or produce and bring our energy storage systems and a digital platform to market on a timely basis, if at all, or that products and technologies developed by others will not render our energy storage systems and any digital platform that we may develop obsolete or noncompetitive, any of which would adversely affect our business, prospects and operating results.

If we are unable to attract and retain key employees and hire qualified management, technical, engineering, and sales personnel, including a highly skilled and diverse management team with experience in the energy storage sectors, our ability to compete and successfully grow our business could be harmed.

We believe that our success and our ability to reach our strategic objectives are highly dependent on the contributions of our key management, technical, engineering and sales personnel. The loss of the services of any of our key employees could disrupt our operations, delay the development and introduction of our products and services, including with respect to our prototype products, and negatively impact our business, prospects and operating results. In particular, we are highly dependent on the services of Robert Piconi, our Chief Executive Officer, Marco Terruzzin, our Chief Product Officer, Andrea Pedretti, our Chief Technology Officer. None of our key employees is bound by an employment agreement for any specific term. We cannot assure you that we will be able to successfully attract and retain senior leadership necessary to grow our business. Furthermore, there is increasing competition for talented individuals in our field, and competition for qualified personnel is especially intense in the renewable energy and energy storage industry in the USA and Switzerland, where, collectively, our primary offices are located. Our failure to attract and retain our executive officers and other key technology, sales, marketing and support personnel, could adversely impact our business, prospects, financial condition, and operating results. In addition, we do not have “key person” life insurance policies covering any of our officers or other key employees.

We believe that it is vital to our operating success that we recruit and retain key personnel, including a highly skilled and diverse management team with experience in the renewable energy and energy storage sectors. If we fail to maintain a highly skilled and diverse management team, we may not be able to achieve our strategic objectives, which would negatively impact our business and operating success. In addition, because our industry is still in a nascent stage, there is and will continue to be a scarcity of skilled personnel with experience in our industry. If we lose a member of our management team or key employee, it may prove difficult for us to replace him or her with a similarly qualified individual with experience in the renewable energy and energy storage industry, which could impact our business and operating success.

Labor disputes could disrupt our ability to serve our customers and/or lead to higher labor costs.

As of December 31, 2022, we employed 170 full-time employees and 7 part-time employees, none of whom are represented by unions and one employee covered by a collective bargaining agreement. If a union sought to organize any of our employees, such organizing efforts or collective bargaining negotiations could potentially lead to work stoppages and/or slowdowns or strikes by certain of our employees. Additionally, the EPC firms that we rely upon to install our energy storage systems may have employees represented by unions or collective bargaining agreements. Any work

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stoppages and/or slowdowns by certain of our employees or certain employees at the EPC firms we contract with, could adversely affect our ability to serve our customers.

Further, settlement of actual or threatened labor disputes or an increase in the number of our employees covered by collective bargaining agreements could lead to higher labor costs and could impair productivity and flexibility.

Our management has limited experience in operating a public company.

Our executive officers have limited experience in the management of a publicly traded company. Our management team may not successfully or effectively manage the current transition to a public company that is subject to significant regulatory oversight and reporting obligations under federal securities laws. Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities which results in less time being devoted to the management and growth of our business. We may not have adequate personnel with the appropriate level of knowledge, experience, and training in the accounting policies, practices or internal controls over financial reporting required of public companies in the United States. The development and implementation of the standards and controls necessary for us to achieve the level of accounting standards required of a public company in the United States may require costs greater than expected. It is possible that the Company will be required to expand its employee base and hire additional employees to support our operations as a public company which will increase our operating costs in future periods.

Changes in business, economic, or political conditions, including overall changes in demand, are beyond our control and could impact our business, resulting in lower revenues and other adverse effects to our results of operations.

Economic uncertainty and associated macroeconomic conditions, including heightened inflation, capital markets volatility, interest rate and currency rate fluctuations, and economic slowdown or recession, have resulted and may continue to result in unfavorable conditions that negatively affect demand for our products and exacerbate some of the other risks that affect our business, financial condition, and results of operations. Both domestic and international markets experienced inflationary pressures in 2022 and inflation rates in the U.S., as well as in other countries in which we operate, are currently expected to continue at elevated levels for the near-term. In addition, the Federal Reserve in the U.S. and other central banks in various countries have raised, and may again raise, interest rates in response to concerns about inflation, which, coupled with reduced government spending and volatility in financial markets, has had and may continue to have the effect of further increasing economic uncertainty and heightening these risks. Interest rate increases or other government actions taken to reduce inflation have resulted in recessionary pressures in many parts of the world. Furthermore, currency exchange rates have been especially volatile in the recent past, and these currency fluctuations have affected, and may continue to affect, the reported value of our assets and liabilities, as well as our cash flows.

A significant downturn in the domestic or global economy may cause our customers to pause, delay, or cancel spending on our offerings or seek to lower their costs by exploring alternatives. To the extent purchases of our offerings are perceived by customers and potential customers as discretionary, our revenue may be disproportionately affected by delays or reductions in energy storage spending. Also, competitors may respond to challenging market conditions by lowering prices and attempting to lure away our customers.

Similarly, our business depends on the overall business and global or regional political conditions, which are beyond our control.

We cannot predict the timing, strength, or duration of any economic slowdown or any subsequent recovery generally, or any industry in particular or how global business and political conditions may change. To the extent that general business, economic or political conditions, including overall changes in demand for our products, decline, our business, financial condition and results of operations, including revenues, could be materially adversely affected.

The productivity of our or our customers’ facilities, the operation of our supply chain, the demand, performance and availability of our products, our services, our systems and our business in general could be adversely affected by events outside of our control, such as natural catastrophic events, geographical instability, wars, and other calamities. We cannot assure you that, collectively, our process and procedures to recover from a disaster or catastrophe will be adequate to protect us from the effects of fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks, pandemics, or similar events outside of our control, certain of which may become more frequent or intense as a result of climate change. For more information, see our risk factor titled “We are subject to a series of risks related to climate change.”. The severity of such factors and frequency at which they occur are also outside our control. If

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such factors occur our business, financial condition and results of operations, including revenues, could be materially adversely affected.

We are subject to a series of risks related to climate change.

There are inherent climate-related risks wherever business is conducted. Certain of our facilities, as well as third-party infrastructure we rely on, are located in areas that have experienced, and are projected to continue to experience, various meteorological phenomena (such as drought, heatwaves, wildfire, storms, and flooding, among others) or other catastrophic events that may disrupt our or our suppliers’ operations (as well as grid connections), require us to incur additional operating or capital expenditures, or otherwise adversely impact our business, financial condition, or results of operations. Climate change may increase the frequency and/or intensity of such events. For example, in certain areas, there has been an increase in power shutoffs associated with wildfire prevention. While we may take various actions to mitigate our business risks associated with climate change, this may require us to incur substantial costs and may not be successful, due to, among other things, the uncertainty associated with the longer-term projections associated with managing climate risk. For example, to the extent such events become more frequent or intense, we may not be able to procure insurance to cover all potential losses on terms we deem acceptable.

Additionally, we expect to be subject to increased regulations, reporting requirements, standards or expectations regarding the environmental impacts of our business. For example, the SEC has published propose rules that would require companies to provide significantly expanded climate-related disclosures in their periodic reporting, which may require us to incur significant additional costs to comply and impose increased oversight obligations on our management and board of directors (“Board”). The expectations of various stakeholders, including customers and employees, regarding such matters likewise continues to evolve. For more information, see our risk factor titled “Increasing attention to, and scrutiny of, environmental, social, and governance matters could increase our costs, harm our reputation, impact our share price or access to or cost of capital, or otherwise adversely impact our business.” Changing market dynamics, global and domestic policy developments, and the increasing frequency and impact of meteorological phenomena have the potential to disrupt our business, the business of our suppliers and/or customers, or otherwise adversely impact our business, financial condition, or results of operations.

Fuel prices, including volatility in the cost of diesel or natural gas or a prolonged period of low gasoline and natural gas costs, could decrease incentives to transition to renewable energy.

A portion of the ~~proceeds received~~current and expected demand for renewable energy results from concerns about volatility in the cost of gasoline and other petroleum-based fuel, the dependency of the United States on oil from unstable or non-aligned countries, government regulations and economic incentives promoting fuel efficiency and alternative forms of energy, as well as concerns about climate change resulting in part from the ~~offering~~burning of ~~redeemable common stock~~fossil fuels. If the cost of gasoline and other petroleum-based fuel decreases significantly, the outlook for the long-term supply of oil to the United States improves, the government eliminates or modifies its regulations or economic incentives related to fuel efficiency and alternative forms of energy or there is a change in the perception in the cost-benefit analysis regarding the effects of burning fossil fuels on the environment, the demand for renewable energy, including energy storage products such as ~~stockholders’ equity. Novus’~~ours, could be reduced, and our business and revenue may be harmed.

Diesel, gasoline, natural gas, and other petroleum-based fuel prices have historically been extremely volatile, and it is difficult to ascertain whether such volatility will continue to persist. Lower gasoline and natural gas costs over extended periods of time may lower the perception in government and the private sector that cheaper, more readily available energy alternatives, such as wind and solar, should be developed and produced. If gasoline or other petroleum-based fuel prices remain at deflated levels for extended periods of time, the demand for renewable energy may decrease notwithstanding incentives to transition to renewable energy, which would have an adverse effect on our business, prospects, financial condition and results of operations.

Our insurance coverage, customer indemnifications or other liability protections may be unavailable or inadequate to cover all of our significant risks, which could adversely affect our profitability and overall financial position.

We endeavor to obtain insurance to cover significant risks and liabilities (including, for example, natural disasters, cyber security, defective hardware and software and products liability). Not every risk or liability can be insured, and insurance coverage is not always reasonably available. The policy limits and terms of coverage reasonably obtainable may not be sufficient to cover actual losses or liabilities. Even if insurance coverage is available, we are not always able to obtain it at a price or on terms acceptable to us or without increasing exclusions. Disputes with insurance carriers over the availability of coverage, and the insolvency of one or more of our insurers may affect the availability or timing of recovery, as well as our ability to obtain insurance coverage at reasonable rates in the future. In some circumstances we may be entitled to certain legal protections or indemnifications from our suppliers through contractual provisions, laws or otherwise. However, these protections are not always available, are difficult to negotiate and obtain, are typically subject to certain

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terms or limitations, including the availability of funds, and may not be sufficient to cover our losses or liabilities. If insurance coverage, customer indemnifications and/or other legal protections are not available or are not sufficient to cover risks or losses, it could have a material adverse effect on our financial position, results of operations and/or cash flows.

Risks Related to Our Financial Condition and Liquidity

During an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2022, management identified ~~this error made~~a material weakness in ~~its historical~~our internal control over financial ~~statements~~reporting. If we continue to fail to maintain proper and ~~performed a quantitative assessment under SAB 99, concluding a restatement was required of Novus’~~effective internal controls over financial ~~statements~~reporting or are unable to ~~classify such amount as Class A common stock subject to possible redemption and a~~remediate the material weakness in our internal controls over financial reporting, ~~relating~~our ability to produce accurate and timely financial statements could be impaired, and investors’ views of us could be harmed.

Management has assessed the ~~accounting for complex~~effectiveness of the Company’s internal control over financial ~~instruments~~reporting as of ~~March~~December 31, ~~2021.~~

~~Novus also reported~~2022. As a result of this assessment, management determined a material weakness in ~~its Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 as management determined~~ our internal control over financial reporting existed relating to the recognition of revenue from certain licensing contracts. Specifically, in connection with one of our licensing contracts, we did not ~~result~~implement effective background check controls for an international customers' ability to pay in order to properly assess the ~~proper accounting for complex financial instruments, in~~probability that ~~the classification~~we will collect substantially all of the ~~private placement warrants and public warrants~~consideration to which we ~~issued in February 2021 were recorded as equity and not liabilities.~~

Aare entitled. Upon our discovery of this material weakness, isadditional substantive controls and procedures were performed to validate completeness and accuracy of underlying data and we determined and began implementation of a ~~deficiency, or a combination of deficiencies,~~remediation plan.

These additional substantive controls and procedures have allowed us to conclude that, notwithstanding the material weakness in our internal control over financial reporting, ~~such that there is a reasonable possibility that a material misstatement of our annual or interim~~the consolidated financial statements included in this Annual Report fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented in conformity with generally accepted accounting principles.

There can be no assurance that our remediation plan will ~~not~~ be ~~prevented, or detected and corrected on a timely basis.~~

~~Effective internal controls~~successful. If we are ~~necessary for us to provide reliable financial reports and prevent fraud. We continue to evaluate steps~~unable to remediate the material ~~weakness. These remediation measures may be time consuming~~weakness timely and ~~costly and there is no assurance that these initiatives will ultimately have the intended effects.~~

~~If we identify any new material weaknesses in the future, any such newly identified material weakness could limit~~sufficiently or are otherwise unable to maintain effective internal control over financial reporting, our ability to ~~prevent or detect a misstatement of our accounts or disclosures that~~report financial information timely and accurately could ~~result in a material misstatement of our annual or interim financial statements. In such case,~~be adversely affected, we may ~~be unable~~fail to ~~maintain compliance with securities law~~meet our reporting requirements ~~regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements,~~and investors may lose confidence in the accuracy and completeness of our financial ~~reporting~~reports. As a result, our business may be harmed, and the market price of our common stock ~~price may decline~~could decline. In addition, we could become subject to investigations by the NYSE or any other stock exchange on which our securities are then listed, the SEC or other regulatory authorities as a ~~result. We cannot assure you that the measures~~result, which could require additional financial and management resources. In addition, even if we ~~have taken to date, or any measures we may take~~are successful in ~~the future, will be sufficient to avoid potential future material weaknesses.~~

~~Our public stockholders~~strengthening our controls and procedures, those controls and procedures may not be ~~afforded an opportunity~~adequate to ~~vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority~~prevent or identify irregularities or ensure the fair and accurate presentation of our ~~public stockholders do not support such a combination.~~

We may not hold a stockholder vote to approve our initial business combination unless the business combination would require stockholder approval under applicable law or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other reasons. For instance, the NYSE rules currently allow us to engage in a tender offer in lieu of a stockholder meeting but would still require us to obtain stockholder approval if we were seeking to issue more than 20% of our outstanding shares to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required us to issue more than 20% of our outstanding shares, we would seek stockholder approval of such business combination. However, except as required by applicable law or stock exchange rules, the decision as to whether we will seek stockholder approval of a proposed business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solelyfinancial statements included in our discretion, and will be based on a variety of factors, such as the timing of the transaction. Accordingly, we may consummate our initial business combination even if holders of a majority of our outstanding public shares do not approve of the business combination we consummate. Please see “Proposed Business — Stockholders May Not Have the Ability to Approve Our Initial Business Combination” for additional information.

If we seek stockholder approval of our initial business combination, our initial stockholders, officers and directors have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote.

Our initial stockholders, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares and any public shares held by them in favor of our initial business combination. As a result, in addition to our initial stockholders’ founder shares, we would need 10,781,251, or 37.5% (assuming all issued and outstanding shares are voted), or 1,796,876, or 6.25% (assuming only the minimum number of shares representing a quorum are voted), of the 28,750,000 public shares to be voted in favor of a transaction, in order to have such initial business combination approved. We expect that our initial stockholders and their

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permitted transferees will own at least 20.0% of our outstanding shares of common stock at the time of any such stockholder vote. Accordingly, if we seek stockholder approval of our initial business combination, it is more likely that the necessary stockholder approval will be received than would be the case if our initial stockholders and their permitted transferees agreed to vote their founder shares in accordanceperiodic reports filed with the ~~majority of the votes cast by our public stockholders.~~

Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of such business combination.

~~At the time of your investment in us, you will not be provided with~~SEC.

We are an opportunity to evaluate the specific merits or risks of any target businesses. Additionally, since our board of directors may complete a business combination without seeking stockholder approval, public stockholders may not have the right or opportunity to vote on the business combination. Accordingly, if we do not seek stockholder approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination.

The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combinationearly stage company with a ~~target.~~

~~We may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount~~history of ~~cash. If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition~~losses, and as a result, would not be able to proceed with the business combination. In no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination (including, potentially, with the same target). Prospective targets will be aware of these risks and, thus, may be reluctant to enter into a business combination transaction with us.

The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure.

At the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights and, therefore, we will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements or arrange for third-party financing. In addition, if a larger number of shares is submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third-party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure.

The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock.

If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful increases. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however, at such time our stock may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your stock in the open market.

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The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders.

Any potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete our initial business combination by February 8, 2023. Consequently, such target business may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer to the end of the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.

We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may receive only $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.

Our initial stockholders, officers and directors have agreed that we must complete our initial business combination by February 8, 2023. We may not be able to find a suitable target business and complete our initial business combination within such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein. For example, the COVID-19 pandemic continues to grow both in the U.S. and globally and, while the extent of the impact of the pandemic on us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. Additionally, the COVID-19 pandemic and other events (such as terrorist attacks, natural disasters or a significant outbreak of other infectious diseases) may negatively impact businesses we may seek to acquire. It may also have the effect of heightening many of the other risks described in this ‘‘Risk Factors’’ section, such as those related to the market for our securities and cross-border transactions.

If we have not completed our initial business combination within such time period or during any Extension Period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In such case, our public stockholders may receive only $10.00 per share, or less than $10.00 per share, on the redemption of their shares, and our warrants will expire worthless. Please see “— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.

If we seek stockholder approval of our initial business combination, our founders, directors, officers, advisors or any of their respective affiliates may enter into certain transactions, including purchasing shares or warrants from the public, which may influence the outcome of our proposed business combination and reduce the public “float” of our securities.

If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our founders, directors, officers, advisors or any of their respective affiliates may purchase public shares or public warrants or a combination thereof in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination, although they are under no obligation or other duty to do so.

Such a purchase may include a contractual acknowledgement that such public stockholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our

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founders, directors, officers, advisors or any of their respective affiliates purchase public shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling public stockholders would be required to revoke their prior elections to redeem their shares. The price per share paid in any such transaction may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our founders, directors, officers, advisors or any of their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. Please see “Proposed Business — Permitted purchases and other transactions with respect to our securities” for a description of how such persons will determine from which stockholders to enter into transactions with. The purpose of any such transaction could be to (1) vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination, (2) reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such transactions may result in the completion of our initial business combination that may not otherwise have been possible.

In addition, if such purchases are made, the public “float” of our Class A common stock or warrants and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.

If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.

We will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares. For example, we may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,” to either tender their certificates to our transfer agent prior to the date set forth in the tender offer or proxy materials documents mailed to such holders, or up to two business days prior to the scheduled vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. In the event that a stockholder fails to comply with these procedures, its shares may not be redeemed. Please see “Proposed Business — Tendering stock certificates in connection with a tender offer or redemption rights.”

Our public stockholders do not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate their investment, therefore, public stockholders may be forced to sell their public shares or warrants, potentially at a loss.

Our public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (1) the completion of our initial business combination, and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject to the limitations described herein; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 8, 2023 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we have not completed our initial business combination by February 8, 2023, subject to applicable law and as further described herein. In addition, if we have not completed an initial business combination within the required time period for any reason, compliance with Delaware law may require that we submit a plan of dissolution to our then existing stockholders for approval prior to the distribution of the proceeds held in our trust account. In that case, public stockholders may be forced to wait beyond the end of such period before they receive funds from our trust account. In no other circumstances will a public stockholder have any right or interest of any kind in or to the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.

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~~If the funds not being held in the trust account are insufficient to allow us to operate at until February 8, 2023, we may be unable to complete our initial business combination.~~

The funds available to us outside of the trust account may not be sufficient to allow us to operate at least until February 8, 2023, assuming that our initial business combination is not completed during that time. We expect to incur significant ~~costs in pursuit of our acquisition plans.~~

~~Our affiliates are not obligated to make loans to us in~~expenses and continuing losses for the foreseeable future, and we may not be able to ~~raise additional financing from unaffiliated parties necessary~~achieve profitability in the future.

Since our inception in October 2017, we have incurred significant net losses and have used significant cash in our business. As of December 31, 2022 and 2021, we had accumulated deficits of $147.3 million and $69.0 million, respectively, and net losses of $78.3 million and$31.3 million, respectively, for the years ended December 31, 2022 and 2021. We expect to ~~fund~~continue to expand our ~~expenses. Any such event~~operations, including by investing in manufacturing, sales and marketing, research and development and infrastructure to support our growth. We anticipate that we will incur net losses for the foreseeable future and there is no guarantee that we will achieve or maintain profitability. Our ability to achieve and maintain profitability in the future will depend on a number of factors, including:

•successfully implementing our products on a commercial scale;

•achieving meaningful sales volume;

•the successful and timely development of our EMS;

•attracting customers;

•expanding into geographical markets;

•our future customers’ ability to attract and retain financing partners who are willing to provide financing for sales on a timely basis and with attractive terms;

•continuing to improve the expected useful life of our GESS technology and reducing our warranty servicing costs;

•the cost of producing our energy storage systems;

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•successful continued development and deployment of our energy storage systems, including our GESS, BESS, and gHESS;

•ability to execute on our strategy to reduce costs, in the amount and on the timing projected;

•ability to add waste material, such as coal ash and wind turbine blades, in the production of mobile masses;

•improving the efficiency and predictability of our construction processes;

•entering into agreements with suppliers and service providers for the maintenance of our systems and other strategic relationships;

•improving the effectiveness of our sales and marketing activities and any independent sales representatives that we may ~~negatively impact~~ engage;

•attracting and retaining key talent in a competitive marketplace;

•the ~~analysis regarding~~amount and timing of stock-based compensation expenses;

•identifying new opportunities for other business to integrate our product into their operations;

•fluctuations in the costs of steel and raw materials;

•legal and commercial acceptance of the incorporation of waste material (including, but not limited to, coal ash) into our mobile masses; and

•delays associated with obtaining construction permits and potential regulatory review.

The implementation of our business plan and strategy may require additional capital. If we are then unable to achieve sufficient sales to generate that capital or otherwise raise capital, it may create substantial doubt about our ability to pursue our business objectives and achieve profitability or to continue as a going ~~concern at such time.~~

~~We believe that the funds~~concern. If adequate capital is not available to us, ~~outside~~including due to the cost and availability of funding in the ~~trust account~~capital markets, our business, operating results and financial condition may be harmed.

The development, design, manufacture and sale of our energy storage systems is a capital-intensive business. As a result, we can be expected to continue to incur substantial operating expenses without generating sufficient revenues to cover expenditures. Over time, we may need to raise additional funds, including through entry into new joint venture arrangements, through the issuance of equity, equity-linked or debt securities or through obtaining credit from financial institutions to fund, together with our principal sources of liquidity, ongoing costs such as research and development relating to our products and technologies, the construction and tooling of prototypes, the implementation of our systems for our future customers, any significant unplanned or accelerated expenses, and new strategic investments. We cannot be certain that additional capital will be ~~sufficient~~available on attractive terms, if at all, when needed, which could be dilutive to ~~allow us to operate at least until February 8, 2023; however, we cannot assure you that~~stockholders, and our ~~estimate is accurate. Of the funds available to us, we could use a portion~~financial condition, results of the funds available to us to pay commitment fees for financing, fees to consultants to assist us with our search for a target business or as a down payment or to fund a “no-shop” provision (a provision in letters of intent or merger agreements designed to keep target businesses from “shopping” around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed business combination, although we do not have any current intention to do so. If we entered into an agreement where we paid for the right to receive exclusivity from a targetoperations, business and ~~were subsequently required to forfeit such funds (whether~~prospects could be materially and adversely affected. Disruptions in the global capital markets and credit markets as a result of an economic downturn, economic uncertainty, changing interest rate yield curves, changing or increased regulations, or failures of significant financial institutions could adversely affect our ~~breach~~cash resources or ~~otherwise),~~access to additional capital needed for business in the future.

The Company maintains the majority of its cash and cash equivalents in accounts with major U.S. and multi-national financial institutions, and our deposits at certain of these institutions exceed insured limits. Market conditions can impact the viability of these institutions. In the event of failure of any of the financial institutions where we ~~might~~maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position.

If adequate capital is not ~~have sufficient funds~~available to us, it may create substantial doubt among third parties, including suppliers and potential customers, about our ability to pursue our objectives, to achieve profitability or to continue ~~searching~~as a going concern. Such doubt could materially and adversely impact our business, reputation and prospects.

Our energy storage systems involve a lengthy sales and installation cycle, and if we fail to close sales on a regular and timely basis it could harm our business. Moreover, the long sales cycles for ~~or conduct due diligence~~our energy storage systems may cause us to incur significant expenses without offsetting revenues

Although we have not yet completed any full cycle from sale to installation of our energy storage systems, we expect them to be lengthy. In order to make a sale, we must typically provide a significant level of education to prospective customers regarding the use and benefits of our products and our technology. The period between initial discussions with ~~respect~~a potential customer and the sale of even a single product typically depends on a number of factors, including the potential customer’s attitude towards innovative products, their budget and decision as to the type of financing it chooses to use, as well as the arrangement of such financing. Prospective customers often undertake a significant evaluation process, which may further

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extend the sales cycle. Once a customer makes a formal decision to purchase our product, the fulfillment of the sales order by us requires a substantial amount of time. Currently, we believe the time between the entry into a sales contract with a customer and the installation of our EVx systems could range from 18 to 36 months and BESSs could range from 9 to 18 months. This lengthy sales and installation cycle is subject to a ~~prospective target business. If~~number of significant risks over which we ~~are unable~~have little or no control.

These lengthy sales and installation cycles increase the risk that our customers fail to ~~complete our initial business combination, our public stockholders may receive only approximately $10.00 per share,~~satisfy their payment obligations or ~~less in certain circumstances, on~~cancel orders before the ~~liquidation~~completion of ~~our trust account~~the transaction or delay the planned date for installation. Generally, a customer can cancel an order prior to installation, and, ~~our warrants~~notwithstanding the fact that a customer’s termination for convenience will ~~expire worthless. Please see “— If third parties bring claims against us,~~obligate the ~~proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.~~

If our cash not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from our founders or management team to fund our search,customer to pay ~~our taxes and to complete our initial business combination. If we are unable to obtain such loans,~~us certain fees, we may be unable to ~~complete~~recover some of our costs in connection with design, permitting, installation and site preparations incurred prior to cancellation. Cancellation rates in our industry could increase in any given period, due to factors outside of our control including an inability to install an energy storage system at the customer’s chosen location because of permitting or other regulatory issues, unanticipated changes in the cost or availability of alternative sources of electricity available to the customer, or other reasons unique to each customer. Our operating expenses are based on anticipated sales levels, and certain of our expenses are fixed. If we are unsuccessful in closing sales after expending significant resources or if we experience delays or cancellations, our business could be materially and adversely affected.

Moreover, our customers typically expend significant effort in evaluating, testing and qualifying our products before making a decision to purchase them, resulting in a lengthy initial sales cycle. While our customers are evaluating our products, we have incurred, and expect to continue to incur, substantial sales, marketing, and research and development expenses to customize our products to the customer’s needs. During an initial sales cycle, we may also expend significant management efforts and order long-lead-time components or materials. Even after this evaluation process, a potential customer may not purchase our products. As a result, these long sales cycles may cause us to incur significant expenses without ever receiving revenue to offset those expenses.

Because of the long sales cycles and the expected limited number of customers for our energy storage systems, our operating results will likely fluctuate significantly from period to period.

We expect that long sales cycles and the expected limited number of customers for our energy storage systems is likely to cause fluctuations in our operating results from period to period. As a result of how we recognize revenue, small fluctuations in the timing of the completion of our sales transactions could also cause operating results to vary materially from period to period. In addition, our financial condition and results of operations may fluctuate in the future due to a variety of factors, many of which are beyond our control.

In addition to the other risks described herein, the following factors could also cause our financial condition and results of operations to fluctuate on a quarterly basis:

•fluctuations in costs associated with the first group of energy storage systems that we deploy;

•the timing of customer installations of our energy storage systems, which may depend on many factors such as availability of inventory, product quality or performance issues, or local permitting requirements, utility requirements, environmental, health and safety requirements, weather and customer facility construction schedules, availability and schedule of our third-party general contractors;

•size of particular customer installations and number of sites involved in any particular quarter;

•delays or cancellations of purchases and installations;

•the timing of when control of uninstalled materials transfers to the customer;

•fluctuations in our service costs;

•weaker than anticipated demand for our energy storage systems due to changes in government regulation, incentives and policies;

•weaker than anticipated demand for our energy storage systems due to our customers’ inability to finance their projects;

•interruptions in our supply chain;

•the timing and level of additional purchases by existing customers;

•unanticipated expenses incurred due to changes in governmental regulations, permitting requirements by local authorities at particular sites, utility requirements and environmental, health and safety requirements;

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•disruptions in our sales, production, service or other business ~~combination.~~activities resulting from our inability to attract and retain qualified personnel;

•shortage of raw materials from our suppliers and associated price increases due to fluctuations in commodities prices; and

•availability of spare parts from our suppliers.

In addition, our revenue, key operating metrics and other operating results in future quarters may fall short of the expectations of investors and financial analysts, which could have an adverse effect on the price of our common stock.

Our total backlog and bookings may not be indicative of our future revenue, which could have a material adverse impact on our business, financial condition, and results of operations.

Our backlog represents the amount of revenue we expect to realize in the future on uncompleted construction contracts, including new contracts under which work has not yet begun, as well as the remaining revenue to be recognized under the Company’s intellectual property licensing agreements. As of December 31, 2022, backlog totaled $331.0 million. Our bookings represents the total MWhs to be delivered and the aggregate contracted value for energy storage systems, tolling arrangements, and license and service agreements signed. The aggregate contracted value excludes any potential future variable payments or royalties. For the year ended December 31, 2022, bookings totaled $540.1 million. There can be no assurance that our backlog and bookings will result in actual revenue in the future in any particular period. This is because the actual receipt, timing, and amount of revenue under contracts included under backlog and bookings are subject to various contingencies, many of which are beyond our control. Our failure to realizing revenue from contracts included in the total amounts estimated under backlog and bookings could have a material adverse impact on our business, financial condition and results of operations.

Our ability to use net operating losses and other tax attributes to offset future taxable income may be subject to certain limitations.

As of December 31, ~~2021,~~2022, we had ~~$396,295 available~~approximately $3.4 million, $21.9 million, and $37.3 million of federal, state and foreign net operating loss (“NOL”) carryforwards, respectively, that will generally carry forward to usoffset future taxable income (if any), until such NOLs expire (if at all). The federal and state net operating loss carryforwards will begin to expire, if unutilized, beginning in 2038. The foreign NOL carryforwards will begin to expire, if unutilized, beginning in 2025. Additionally, as of December 31, 2022, the Company had federal and state research tax credit carryforwards of and $0.3 million and $0.3 million, respectively. The federal research tax credit carryforwards will begin to expire, if unutilized, in 2041. The state tax research credits do not expire.

Federal NOLs generated in taxable years ending after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOLs may be limited to 80% of our taxable income annually for tax years beginning after December 31, 2020. Our NOL carryforwards are subject to review and possible adjustment by the applicable tax authorities. In addition, in general, under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the “Code”), if a corporation undergoes an “ownership change,” generally defined as a cumulative change of more than 50 percentage points (by value) in its equity ownership by certain stockholders over a three-year period, the corporation’s ability to use its pre-change NOL carryforwards and other pre-change tax attributes (such as research and development tax credits) to offset its post-change income or taxes may be limited. We may experience ownership changes in the future as a result of subsequent changes in our stock ownership, some of which are outside ~~the trust account~~our control. Similar provisions of state and foreign tax law may apply and future regulatory changes could also limit our ability to ~~fund~~utilize NOL carryforwards to offset future taxable income.

Changes in tax laws and regulations may have a material adverse effect on our ~~working capital requirements. If we are required to seek additional capital, we would need to borrow funds from our initial stockholders, management team~~business, financial condition, and result of operations.

New income, sales, use, or other ~~third parties to operate~~tax laws, statutes, rules, regulations, or ~~may~~ordinances could be ~~forced to liquidate. Neither our initial stockholders, members~~enacted at any time, which could affect the tax treatment of any of our ~~management team nor any~~future U.S. and non-U.S. earnings. Further, existing tax laws, statutes, rules, regulations, or ordinances could be interpreted, changed, modified, or applied adversely to us. Generally, future changes in applicable U.S. and non-U.S. tax laws and regulations, or their interpretation and application, potentially with retroactive effect, could have an adverse effect on our business, financial conditions, and results of their respective affiliates is under any obligation or other duty to loan funds to, or invest in, us in such circumstances. Any such loans may be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. If weoperations. We are unable to ~~complete~~predict whether such changes will occur and, if so, the ultimate impact on our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. In such case, our public stockholders may receive only $10.00 per share, or less in certain circumstances, and our warrants will expire worthless. Please see “— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per- share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.

~~Subsequent to our completion of our initial business combination, we~~business.

We may be required to ~~subsequently~~ take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and ~~the~~stock price, ~~of our securities,~~ which could cause you to lose some or all of your investment.

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~~Even if we conduct extensive due diligence on a target business with which we combine, we cannot assure you~~

Unexpected risks may arise that ~~this diligence will identify all material issues that may be present with a particular target business, that it would be possible~~cause us to ~~uncover all material issues through a customary amount of due diligence,~~write down or ~~that factors outside of the target business and outside of our control will not later arise. As a result of these factors, we may be forced to later write-down or write-off~~write off assets, restructure our operations, or incur impairment or other charges that could result in ~~our reporting~~ losses. ~~Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis.~~ Even though these charges may be ~~non-cash~~noncash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which we may be ~~subject as a result of assuming pre-existing debt held by a target business or by virtue of~~subject. Accordingly, our ~~obtaining post-combination debt financing. Accordingly, any~~ stockholders ~~or warrant holders who choose~~

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~~to remain a stockholder or warrant holder following our initial business combination~~ could suffer a reduction in the value of their ~~securities. Such stockholders~~shares.

Incorrect estimates or ~~warrant holders are unlikely to have a remedy for such reduction in value.~~

The grant of registration rights to our initial stockholders and their permitted transferees may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A common stock.

~~Pursuant to an agreement entered~~assumptions by management in connection with the ~~IPO or at or after the time~~preparation of our ~~initial business combination,~~consolidated financial statements could adversely affect our ~~initial stockholders and their permitted transferees can demand that we register the resale of their founder shares after those shares convert to shares~~reported assets, liabilities, income, revenue or expenses.

The preparation of our ~~Class A common stock. In addition, (1)~~consolidated financial statements requires management to make critical accounting estimates and assumptions that affect the reported amounts of assets, liabilities, income, revenues or expenses during the reporting periods. Incorrect estimates and assumptions by management could adversely affect our ~~initial stockholders~~reported amounts of assets, liabilities, income, revenues and ~~their permitted transferees can demand that~~expenses during the reporting periods. If we ~~register the resale of the private placement warrants and the shares of Class A common stock issuable upon exercise of the private placement warrants and (2) holders of warrants that~~make incorrect assumptions or estimates, our reported financial results may be ~~issued upon conversion~~over- or understated, which could materially and adversely affect our business, financial condition and results of ~~working capital loans~~operations.

Risks Related to Our Intellectual Property and Technology

We may demand that we register the resale of such warrants and the Class A common stock issuable upon exercise of the warrants. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of our Class A common stock. In addition, the existence of the registration rights may make our initial business combination more costly or difficult to complete. This is because the stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our Class A common stock that is expected when the securities described above are registered for resale.

Because we are neither limited to evaluating target businesses in a particular industry, sector or geographic area nor have we selected any specific target businesses with which to pursue our initial business combination, you will be unable to ~~ascertain the merits~~protect, defend, maintain or ~~risks of any particular target business’s operations.~~

~~We may seek to complete a~~enforce intellectual property rights on which our business ~~combination with an operating company in any industry, sector~~depends, including as against existing or geographic area. However, we are not, under our amended and restated certificate of incorporation, permitted to effectuate our initial business combination solely with another blank check company or similar company with nominal operations. Because we have not yet selected or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business’s operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any stockholders or warrant holders who choose to remain a stockholder or warrant holder following our initial business combination could suffer a reduction in the value of their securities. Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value.

~~We may seek acquisition opportunities in acquisition targets that may be outside of our management’s areas of expertise.~~

~~Although we expect to focus our search for a target business that is at the forefront of high technology and are enabling the~~ future evolution of smart technologies, such as 5G communication, virtual reality, artificial intelligence, spatial computing, cloud analytics, machine learning, hardware and software distribution, value added customized logistics services, sustainable smart city systems and AgTech. We will consider a business combination outside of our management’s areas of expertise if such business combination candidate is presented to us and we determine that such candidate offers an attractive acquisition opportunity for our company. As a result, our management may not be able to adequately ascertain or assess all of the significant risk factors relevant to such acquisition. Accordingly, any stockholders or warrant holders who choose to remain a stockholder or warrant holder following our initial business combination could suffer a reduction in the value of their securities. Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value.

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Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines.

Although we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business combination will not have all of these positive attributes, including satisfying ESG considerations. If we complete our initial business combination with a target that does not meet some or all of these criteria and guidelines, such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by applicable law or stock exchange rules, or we decide to obtain stockholder approval for business or other reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.

We may seek acquisition opportunities with an early stage company, a financially unstable business or an entity lacking an established record of revenue or earnings, which could subject us to volatile revenues or earnings, intense competition and difficulties in obtaining and retaining key personnel.

Many participants in the industries in which we intend to focus our search for target businesses are early stage companies. To the extent we complete our initial business combination with an early stage company, a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include investing in a business without a proven business model and with limited historical financial data, volatile revenues or earnings, intense competition and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business.

We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm regarding fairness. Consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view.

Unless we complete our initial business combination with a business that is affiliated with our sponsors, officers or directors, we are not required to obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm that the price we are paying is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination.

Resources could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.

We anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.

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Please see “— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.

We may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company.

When evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the target business’s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target’s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target’s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any stockholders or warrant holders who choose to remain a stockholder or warrant holder following our initial business combination could suffer a reduction in the value of their securities. Such stockholders or warrant holders are unlikely to have a remedy for such reduction in value.

The officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination target’s key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidate’s key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain members of an acquisition candidate’s management team will remain associated with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place. As a result, we may need to reconstitute the management team of the post-transaction company in connection with our initial business combination, which may adversely impact our ability to complete an acquisition in a timely manner or at all.

Since our initial stockholders will lose their entire investment in us if our initial business combination is not completed (other than with respect to any public shares they may hold), a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.

In October 2020, our initial stockholders purchased an aggregate of 7,187,500 founder shares for a capital contribution of $25,000. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20.0% of the outstanding shares of common stock upon the completion of the IPO (not including the shares of Class A common stock issuable upon exercise of the private placement warrants). The founder shares will be worthless if we do not complete an initial business combination.

In addition, our initial stockholders purchased an aggregate of 5,166,666 private placement warrants for a purchase price of $7,750,000, or $1.50 per warrant, that will also be worthless if we do not complete our initial business combination.

The personal and financial interests of our officers and directors may influence their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of the business following the initial business combination. This risk may become more acute as the deadline for completing our initial business combination nears.

~~Cowen and Company, LLC may have a conflict of interest in rendering services to us in connection with our initial business combination.~~

Pursuant to a Business Combination Marketing Agreement, we engaged Cowen and Company, LLC to provide certain specified services to us in connection with our initial business combination, though such services will not include the provision of any M&A-related advisory services We will pay Cowen and Company, LLC the Marketing Fee for such services upon the consummation of our initial business combination in an amount equal to, in the aggregate, 3.5% of the gross proceeds of the IPO (or $10,062,500). In the ordinary course of business, Cowen and Company, LLC and its affiliates may at any time hold long or short positions, and may trade or otherwise effect transactions, for its own account and the accounts of customers, in the debt or equity securities of us, our affiliates or other entities that may be involved in the transactions contemplated by the Business Combination Marketing Agreement, and may provide advisory and other services to one or more actual or potential business combination targets, investors or other parties to any business combination or other transaction entered into by us, for which services Cowen and Company, LLC or one or more of its affiliates may be paid fees, including fees conditioned upon the closing of a particular business combination or other transaction or

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transactions. This financial interest may result in Cowen and Company, LLC having a conflict of interest when providing the services to us in connection with an initial business combination. See “Underwriting — Business Combination Marketing Agreement.”

~~We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination,~~competitors, which may adversely affect our ~~leverage~~growth and ~~financial condition~~success.

We rely primarily on patent, copyright, trade secret and ~~thus negatively impact the value of our stockholders’ investment in us.~~

Although we have no commitments as of the date of this annual report to issue any notes or other debt securities, or to otherwise incur outstanding debt, we may choose to incur substantial debt to complete our initial business combination. We have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:

●~~default~~trademark laws, and ~~foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;~~

●acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;

●

~~our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand;~~

●~~our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding;~~

●~~our inability to pay dividends on our common stock;~~

●using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, expenses, capital expenditures, acquisitionsnon-disclosure, confidentiality, and other ~~general corporate purposes;~~

●~~limitations on~~types of contractual restrictions to establish, maintain, and enforce our ~~flexibility in planning for~~intellectual property and ~~reacting to changes in~~proprietary rights. However, our ~~business~~rights under these laws and ~~in the industry in which we operate;~~

●~~increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and~~

●limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt.

~~We may~~agreements afford us only ~~be able to complete one business combination with the proceeds of held in the trust account~~limited protection and the ~~sale of the private placement warrants, which will cause us~~actions we take to ~~be solely dependent on a single business which may have a limited number of products or services. This lack of diversification may materially negatively impact~~establish, maintain, and enforce our ~~operations and profitability.~~

We had $277,453,323 (assuming no redemptions by the public stockholders), after payment of the Marketing Fee of $10,062,500 in the trust account as of December 31, 2021, that we may use to complete our initial business combination.

~~We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However, we~~intellectual property rights may not be ~~able to effectuate~~adequate. For example, certain of our ~~initial business combination with more than one target business because of various factors, including the existence of complex accounting issues~~engineers reside in California and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single entity our lack of diversification may subject us to numerous economic, competitive and regulatory risks. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to

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~~complete several business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success may be:~~

●~~solely dependent upon the performance of a single business, property or asset; or~~

●~~dependent upon the development or market acceptance of a single or limited number of products, processes or services.~~

This lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.

We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.

If we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations.

~~We may attempt to complete our initial business combination with a private company about which little information is available, which may result in a business combination with a company that~~ is not ~~as profitable as we suspected, if at all.~~

legally permissible to prevent them from working for a competitor. In ~~pursuing~~addition, our ~~acquisition strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public~~trade secrets and other confidential information ~~generally exists about private companies, and we~~ could be ~~required to make our decision on whether to pursue a potential initial business combination on the basis of limited information, which may result~~disclosed in ~~a business combination with a company that is not as profitable as we suspected, if at all.~~

Our management likely will not be able to maintain control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.

We may structure our initial business combination so that the post-transaction company in which our public stockholders own or acquire shares will own less than 100% of the outstanding equity interests or assets of a target business, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for us not to be required to register as an investment company under the Investment Company Act. We will not consider any transaction that does not meet such criteria. Even if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in our initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares of common stock in exchange for all of the outstanding capital stock of a target, or issue a substantial number of new sharesunauthorized manner to third parties, ~~in connection with financing~~ our ~~initial business combination. In such cases, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new shares of common stock,~~owned or licensed intellectual property rights could be challenged, invalidated, circumvented, infringed, or misappropriated or our stockholders immediately prior to such transaction would likely own less than a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company’s stock than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our control of the target business.

We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete our initial business combination with which a substantial majority of our stockholders do not agree.

Our amended and restated certificate of incorporation does not provide a specified maximum redemption threshold, except that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial

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business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our founders, officers, directors, advisors or any of their respective affiliates. In the event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all shares of common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination (including, potentially, with the same target).

In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation or governing instruments, including our warrant agreement, in a manner that will make it easier for us to complete our initial business combination that some of our stockholders or warrant holdersintellectual property rights may not ~~support.~~

In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments, including their warrant agreements. For example, blank check companies have amended the definition of business combination, increased redemption thresholds, extended the time to consummate an initial business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial business combination in order to effectuate our initial business combination.

We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination.

~~Although we believe that the proceeds held in the trust account will~~ be sufficient to ~~allow~~provide us ~~to complete our initial business combination, because we have not yet selected~~with a competitive advantage, any ~~target business we cannot ascertain the capital requirements for any particular transaction. If the proceeds held in the trust account prove to be insufficient, either because~~ of the size of our initial business combination, the obligation to redeem for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination or the terms of negotiated transactions to purchase shares in connection with our initial business combination, we may be required to seek additional financing or to abandon the proposed business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. None of our initial stockholders or its affiliates are obligated to provide, or seek, any such financing or, except as expressly set forth herein, to provide any other services to us. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financingwhich could have a material adverse effect on our business, financial condition or operating results.

The laws of some countries do not protect intellectual property rights as fully as do the ~~continued development or growth~~laws of the ~~target business. None~~United States. Therefore, our intellectual property rights may not be as strong or as easily enforced outside of the United States and efforts to protect against the unauthorized use of our ~~officers, directors~~intellectual property rights, technology and other proprietary rights may be more expensive and difficult outside of the United States. Further, we have not established our intellectual property rights in all countries in the world, and competitors may copy our designs and technology and operate in countries in which we have not prosecuted out intellectual property. Failure to adequately protect our intellectual property rights could result in our competitors using our intellectual property to offer products, and competitors’ ability to design around our intellectual property would enable competitors to offer similar or ~~stockholders~~better batteries, in each case potentially resulting in the loss of some of our competitive advantage and a decrease in our revenue, which would adversely affect our business, prospects, financial condition and operating results.

Our patents and patent applications, if issued, may not provide adequate protection to create a barrier to entry. The provisional and non-provisional patent applications that we own may not issue as patents or provide adequate protection to create a barrier to entry, which may hinder our ability to prevent competitors from selling products similar to ours.

We cannot be certain that our pending patent applications will result in issued patents or that any of our issued patents will afford protection against a competitor. The status of patents involves complex legal and factual questions, and the breadth of claims allowed is ~~required to provide~~uncertain. As a result, we cannot be certain that the patent applications that we file will result in patents being issued or that our patents and any ~~financing~~patents that may be issued to us in ~~connection~~the future will afford protection against competitors with similar technology. In addition, patent applications filed in foreign countries are subject to laws, rules, and procedures that differ from those of the United States, and thus we cannot be certain that foreign patent related to issued U.S. patents will be issued in other regions. Furthermore, even if these patent applications are accepted and the associated patents are issued, some foreign countries provide significantly less effective patent enforcement than in the United States.

We intend to continue to regularly assess opportunities for seeking patent and other intellectual property protections for certain aspects of our technology, designs and methodologies that we believe provide a meaningful competitive advantage. However, our ability to do so may be limited until such time as we are able to generate cash flow from operations or ~~after~~otherwise raise sufficient capital to continue to invest in our ~~initial business combination.~~intellectual property. For example, maintaining patents in the United States and other countries requires the payment of maintenance fees, which may result in loss of our patent rights if we are unable to pay. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account, and our warrants will expire worthless.

As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even resultso invest in our ~~inability to find a target or to consummate an initial business combination.~~

In recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and there are still many special purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources to identify a suitable target and to consummate an initial business combination.

In addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause targets companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as

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economic or industry sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrateintellectual property, our ability to ~~find~~protect it or prevent others from infringing on our proprietary rights may be impaired.

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In addition, patents issued to us may be infringed upon or designed around by others and ~~consummate an initial business combination, and~~others may ~~result in our inability to consummate an initial business combination on terms favorable to our investors altogether.~~

~~Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination.~~

Over the past year, the market for directors and officers liability insurance for special purpose acquisition companies has changed. The premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable. There can be no assuranceobtain patents that ~~these trends will not continue.~~

The increased cost and decreased availability of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company, the post-business combination entity mightwe need to ~~incur greater expense, accept less favorable terms~~license or both. However, any failure to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination’s ability to attract and retain qualified officers and directors.

In addition, even after we were to complete an initial business combination, our directors and officers could still be subject to potential liability from claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors and officers, the post-business combination entity will likely need to purchase additional insurance with respect to any such claims (“run-off insurance”). The need for run-off insurance would be an added expense for the post-business combination entity, and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable to our investors.

Our initial stockholders control the election of our board of directors until consummation of our initial business combination and will hold a substantial interest in us. As a result, they will elect all of our directors prior to our initial business combination and may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support.

Our initial stockholders own 20.0% of our outstanding common stock. In addition, prior to our initial business combination, holders of our Class B common stock will have the right to appoint all of our directors and may remove members of our board of directors for any reason. Holders of our public shares will have no right to vote on the election of directors during such time. These provisions of our amended and restated certificate of incorporation may only be amended by holders of a majority of at least 90% of the outstanding shares of our common stock voting at a stockholder meeting. As a result, you will not have any influence over the election of directors prior to our initial business combination.

Neither our initial stockholders nor, to our knowledge, any of our officers or directors, have any current intention to purchase additional securities, other than in connection with the PIPE, as disclosed in this annual report. Factors that would be considered in making such additional purchases would include consideration of the current trading price of our Class A common stock. In addition, as a result of their substantial ownership in our company, our initial stockholders may exert a substantial influence on other actions requiring a stockholder vote, potentially in a manner that you do not support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If our initial stockholders purchase any additional shares of common stock in the aftermarket or in privately negotiated transactions, this would increase their influence over these actions. Accordingly, our initial stockholders will exert significant influence over actions requiring a stockholder vote. Please see “Proposed Business — Permitted purchases and other transactions with respect to our securities.”

Because we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses.

The federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial significance tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), or

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PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such financial statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame.

If our management team pursues a company with operations or opportunities outside of the United States for our initial business combination, we may face additional burdens in connection with investigating, agreeing to and completing such combination, and if we effect such initial business combination, we would be subject to a variety of additional risks that may negatively impact our operations.

If our management team pursues a company with operations or opportunities outside of the United States for our initial business combination, we would be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing to and completing our initial business combination, conducting due diligence in a foreign market, having such transaction approved by any local governments, regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates.

If we effect our initial business combination with such a company, we would be subject to any special considerations or risks associated with companies operating in an international setting, including any of the following:

●~~costs and difficulties inherent in managing cross-border business operations and complying with commercial and legal requirements of overseas markets;~~

●~~rules and regulations regarding currency redemption;~~

●~~complex corporate withholding taxes on individuals;~~

●~~laws governing the manner in which future business combinations may be effected;~~

●~~tariffs and trade barriers;~~

●~~regulations related to customs and import/export matters;~~

●~~longer payment cycles;~~

●~~changes in local regulations as part of a response to the COVID-19 coronavirus pandemic;~~

●~~tax consequences;~~

●~~currency fluctuations and exchange controls;~~

●~~rates of inflation;~~

●~~challenges in collecting accounts receivable;~~

●~~cultural and language differences;~~

●~~employment regulations;~~

●~~crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;~~

●~~deterioration of political relations with the United States;~~

●~~obligatory military service by personnel; and~~

●~~government appropriation of assets.~~

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We may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such combination or, if we complete such combination, our operations might suffer,design around, either of which ~~may adversely impact our results of operations~~would increase costs and ~~financial condition.~~

If our management following our initial business combination is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws, which could lead to various regulatory issues.

Following our initial business combination, any or all of our management could resign from their positions as officers of the post-business combination company, and the management of the target business at the time of the business combination could remain in place. Management of the target business may not be familiar with U.S. securities laws. If new management is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our ~~operations.~~

~~Risks Relating~~business, our prospects, and our operating results.

We may be subject to ~~Our Management~~

~~Past performance by members~~third-party claims of infringement, misappropriation or other violation of intellectual property rights, or other claims challenging our ~~management team and their respective affiliates may not be indicative of future performance of an investment in us.~~

Information regarding performance by, or businesses associated with, members of our management team and their respective affiliates, is presented for informational purposes only. Any past experience and performance, includingagreements related to ~~acquisitions, of members of~~intellectual property, which may be time-consuming and costly to defend, and could result in substantial liability.

Companies, organizations, or individuals, including our ~~management team and their respective affiliates, is not a guarantee either: (1)~~competitors, may hold or obtain patents, trademarks, or other intellectual property rights that ~~we will be able to successfully identify a suitable candidate for our initial business combination;~~may prevent, limit, or ~~(2) of any results~~interfere with respect to any initial business combination we may consummate. You should not rely on the historical record of our management team’s or their affiliates’ performance, as indicative of the future performance of an investment in us or the returns we will, or are likely to, generate going forward.

Our officers and directors allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to ~~complete~~make, use, develop, or sell our ~~initial business combination.~~

~~Our officers and directors are not required to, and will not, commit their full time to our affairs,~~products or services, which may result in a conflict of interest in allocating their time between our operations and our search for a business combination and their other responsibilities. We do not intend to have any full-time employees prior to the completion of our business combination. Each of our officers and directors is engaged in several other business endeavors for which he or she may be entitled to substantial compensation and our officers and directors are not obligated to contribute any specific number of hours per week to our affairs. Our independent directors also serve as officers and/or board members for other entities. If our officers’ and directors’ other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination. Please see “Management — Directors and Executive Officers” for a discussion of our officers’ and directors’ other business affairs.

~~We are dependent upon our officers and directors and their departure could adversely affect our ability to operate.~~

Our operations are dependent upon a relatively small group of individuals. We believe that our success depends on the continued service of our officers and directors, at least until we have completed our initial business combination. We do not have an employment agreement with, or key-man insurance on the life of, any of our directors or officers. The unexpected loss of the services of one or more of our directors or officers could have a detrimental effect on us.

Our ability to successfully effect our initial business combination and to be successful thereafter will be dependent upon the efforts of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post- combination business.

Our ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business, however, cannot presently be ascertained.

Although some of our key personnel may remain with the target business in senior management or advisory positions following our initial business combination, we do not currently expect that any of them will do so. While we intend to closely scrutinize any individuals we engage after our initial business combination, we cannot assure you that our assessment of these individuals will prove

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to be correct. These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements.

In addition, the officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination target’s key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidate’s key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain members of an acquisition candidate’s management team will remain associated with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place. The loss of key personnel could negatively impact the operations and profitability of our post-combination business.

Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination, and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may cause our key personnel to have conflicts of interest in determining whether to proceed with a particular business combination. However, we do not expect that any of our key personnel will remain with us after the completion of our initial business combination.

Our key personnel may be able to remain with our company after the completion of our initial business combination only if they are able to negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously with the negotiation of the business combination and could provide for such individuals to receive compensation in the form of cash payments and/or our securities for services they would render to us after the completion of the business combination.

Such negotiations also could make such key personnel’s retention or resignation a condition to any such agreement. The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business. However, we believe the ability of such individuals to remain with us after the completion of our initial business combination will not be the determining factor in our decision as to whether or not we will proceed with any potential business combination, as we do not expect that any of our key personnel will remain with us after the completion of our initial business combination. The determination as to whether any of our key personnel will remain with us will be made at the time of our initial business combination.

Our officers and directors may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity or other transaction should be presented.

Until we consummate our initial business combination, we intend to engage in the business of identifying and combining with one or more businesses. Our sponsors and officers and directors are, or may in the future become, affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business. We do not have employment contracts with our officers and directors that will limit their ability to work at other businesses.

Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Our officers and directors may in the future become affiliated with entities that are engaged in a similar business, including other blank check companies that may have acquisition objectives that are similar to our company. Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us.

Please see “Management — Directors and Executive Officers,” “Management — Conflicts of Interest” and “Certain Relationships and Related Party Transactions” for a discussion of our officers’ and directors’ business affiliations and potential conflicts of interest.

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~~Our officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.~~

We have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may enter into a business combination with a target business that is affiliated with one or more of our sponsors, directors or officers. We do not have a policy that expressly prohibits any such persons from engaging for their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.

We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our initial stockholders, officers or directors which may raise potential conflicts of interest.

In light of the involvement of our initial stockholders, officers and directors, and their affiliates with other businesses, we may decide to acquire one or more businesses affiliated with or competitive with our initial stockholders, officers and directors, and their respective affiliates. Our directors also serve as officers and/or board members for other entities, including, without limitation, those described under “Management — Conflicts of Interest.” Such entities may compete with us for business combination opportunities. Our initial stockholders, officers and directors are not currently aware of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and there have been no substantive discussions concerning a business combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for a business combination as set forth in “Proposed Business — Selection of a target business and structuring of our initial business combination” and such transaction was approved by a majority of our independent and disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm, regarding the fairness to our company from a financial point of view of a business combination with one or more domestic or international businesses affiliated with our sponsors, officers or directors, potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.

Moreover, we may, at our option, pursue an affiliated joint acquisition opportunity with an initial stockholder or one of their affiliates or with other entities to which an officer or director has a fiduciary, contractual or other obligation or duty. Any such parties may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by making a future issuance of securities to any such parties, which may give rise to certain conflicts of interest.

~~Risks Relating to Our Securities~~

~~The NYSE may delist our securities from trading on its exchange, which could limit investors’ ability to make transactions in our securities and subject us to additional trading restrictions.~~

Our units, Class A common stock and warrants are listed on the NYSE. Although we currently meet the minimum initial listing standards set forth in the NYSE listing standards, we cannot assure you that our securities will continue to be listed on the NYSE in the future or prior to our initial business combination. In order to continue listing our securities on the NYSE prior to our initial business combination, we must maintain certain financial, distribution and stock price levels. In general, we must maintain a minimum number of holders of our securities (generally 300 public stockholders).

Additionally, in connection with our initial business combination, we will be required to demonstrate compliance with the NYSE’s initial listing requirements, which are more rigorous than the NYSE’s continued listing requirements, in order to continue to maintain the listing of our securities on the NYSE. For instance, in order for our Class A common stock to be listed upon the consummation of our initial business combination, at such time, our stock price would generally be required to be at least $4.00 per share, our global market capitalization would be required to be at least $200,000,000, the aggregate market value of publicly-held shares would be required to be at least $100,000,000 and we would be required to have at least 400 round lot holders. We cannot assure you that we will be able to meet those initial listing requirements at that time.

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If the NYSE delists any of our securities from trading on its exchange and we are not able to list such securities on another national securities exchange, we expect such securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:

●~~a limited availability of market quotations for our securities;~~

●~~reduced liquidity for our securities;~~

●a determination that our Class A common stock is a “penny stock” which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

●~~a limited amount of news and analyst coverage; and~~

●~~a decreased ability to issue additional securities or obtain additional financing in the future.~~

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our units have been approved for listing on the NYSE and eventually our Class A common stock and warrants will be listed on the NYSE, our units, Class A common stock and warrants will qualify as covered securities under such statute. Although the states are preempted from regulating the sale of covered securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on the NYSE, our securities would not qualify as covered securities under such statute and we would be subject to regulation in each state in which we offer our securities.

If we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a “group” of stockholders are deemed to hold in excess of 15% of the public shares, you will lose the ability to redeem all such shares in excess of 15% of the public shares.

If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the public shares, which we refer to as the “Excess Shares,” without our prior consent.

However, our amended and restated certificate of incorporation does not restrict our stockholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions.

Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your stock in open market transactions, potentially at a loss.

Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less in certain circumstances, on our redemption of their stock, and our warrants will expire worthless.

We encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to

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various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we have and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there will be numerous target businesses we could potentially acquire with the proceeds held in the trust account, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. Our initial stockholders or any of their affiliates may make additional investments in us, although our initial stockholders and their affiliates have no obligation or other duty to do so. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, our obligation to pay cash in connection with our public stockholders who exercise their redemption rights may reduce the resources available to us for our initial business combination and our outstanding warrants, and the future dilution they potentially represent, may not be viewed favorably by target businesses. Any of these factors may place us at a competitive disadvantage in successfully negotiating and completing an initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. Please see “— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.

~~If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per- share redemption amount received by stockholders may be less than $10.00 per share.~~

~~Our holding of funds in the trust account may not protect those funds from third-party claims against us.~~

V Donargo, an entity controlled by Vincent Donargo, our Chief Financial Officer, has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below: (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriter of the IPO against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, V Donargo LLC will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether V Donargo LLC has sufficient funds to satisfy its indemnity obligations and believe that its only assets are stock of our company. V Donargo may not have sufficient funds available to satisfy those obligations. We have not asked V Donargo LLC to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.00 per public share. In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in

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connection with any redemption of your public shares. Except as set forth above, none of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

Our independent directors may decide not to enforce the indemnification obligations of V Donargo LLC, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders.

In the event that the proceeds held in the trust account are reduced below the lesser of: (1) $10.00 per public share; or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, and V Donargo LLC asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against V Donargo LLC to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against V Donargo LLC to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in certain instances. For example, the cost of such legal action may be deemed by the independent directors to be too high relative to the amount recoverable or the independent directors may determine that a favorable outcome is not likely. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.00 per share.

The securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.00 per share.

The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of interest, they have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates below zero in recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt similar policies in the United States. In the event that we are unable to complete our initial business combination or make certain amendments to our amended and restated memorandum and articles of association, our public stockholders are entitled to receive their pro-rata share of the proceeds held in the trust account, plus any interest income, net of taxes paid or payable (less, in the case we are unable to complete our initial business combination, $10,000 of interest). Negative interest rates could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.00 per share.

If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages.

If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith by paying public stockholders from the trust account prior to addressing the claims of creditors, thereby exposing itself and us to claims of punitive damages.

If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.

If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our public stockholders in connection with our liquidation would be reduced.

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~~Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares.~~

Under the Delaware General Corporation Law, or the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within the required time period may be considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably possible following February 8, 2023 of the (or the end of any Extension Period) in the event we do not complete our initial business combination and, therefore, we do not intend to comply with the foregoing procedures.

Because we do not intend to comply with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the 10 years following our dissolution. However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, consultants, etc.) or prospective target businesses. If our plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder’s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within the required time period is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.

We likely will not hold an annual meeting of stockholders until after we consummate our initial business combination and you will not be entitled to any of the corporate protections provided by such a meeting.

We likely will not hold an annual meeting of stockholders until after we consummate our initial business combination (unless required by the NYSE) and thus may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting of stockholders be held for the purposes of electing directors in accordance with a company’s bylaws unless such election is made by written consent in lieu of such a meeting. Therefore, if our stockholders want us to hold an annual meeting prior to our consummation of our initial business combination, they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL. Until we hold an annual meeting of stockholders, public stockholders may not be afforded the opportunity to discuss company affairs with management. In addition, prior to our business combination (a) as holders of our Class A common stock, our public stockholders will not have the right to vote on the appointment of our directors and (b) holders of a majority of the outstanding shares of our Class B common stock may remove a member of our board of directors for any reason.

Our warrants are accounted for as a warrant liability and are recorded at fair value upon issuance with any changes in fair value each period reported in our statement of operations, which may have an adverse effect on the market price of our securities or may make it more difficult for us to ~~consummate an initial business combination.~~

~~Following~~operate our business. These companies holding intellectual property rights allegedly relating to our products or services could, in the ~~consummation~~future, make claims or bring suits alleging infringement, misappropriation, or other violations of such rights, or otherwise assert their rights by seeking royalties or injunctions. If a claim is successfully brought in the future and we or our products or services are determined to have infringed, misappropriated, or otherwise violated a third party’s intellectual property rights, we may be required to do one or more of the ~~IPO~~following:

•cease selling or using our products or services that incorporate the challenged intellectual property;

•pay substantial damages (including treble damages and attorneys’ fees if our infringement is determined to be willful);

•obtain a license from the ~~concurrent private placement of private placement warrants on February 8 2021, we have 14,749,999 warrants outstanding (comprised~~holder of the ~~9,583,333 warrants included~~relevant intellectual property rights, which may not be available on reasonable terms or at all; or

•redesign our products, services, or means of production, which may not be possible or cost-effective.

Any of the foregoing could adversely affect our business, prospects, operating results, and financial condition. In addition, any litigation or claims, whether or not valid, could harm our reputation, result in substantial costs and divert resources and management attention.

We also license technology from third parties and incorporate components supplied by third parties into our products. We may in the ~~units~~future face claims that our use of such technology or components infringes or otherwise violates the rights of others, which would subject us to the risks described above. We may in some cases seek indemnification from our licensors or suppliers under our contracts with them, but our rights to indemnification or our suppliers’ resources may be unavailable or insufficient to cover our costs and losses.

We may be subject to claims that our employees, consultants, or advisors have wrongfully used or disclosed proprietary information or know-how of their current or former employers or claims asserting ownership of what we regard as our own intellectual property rights.

Many of our employees, consultants, and advisors are currently or were previously employed or engaged at other companies in our field, including our competitors or potential competitors. Although we try to ensure that our employees, consultants, and advisors do not use the ~~5,166,666 private placement warrants).~~ proprietary information or know-how of others in their work for us, we may be subject to claims that we or these individuals have used or disclosed intellectual property rights, including trade secrets or other proprietary information, of any such individual’s current or former employer. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management.

In addition, while it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property rights to execute agreements assigning such intellectual property rights to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property rights that we regard as our own. Additionally, the assignment of intellectual property rights may not be self-executing, or the assignment agreements may be breached, and we may be forced to bring claims against third parties, or defend claims that they may bring against us, to determine the ownership of what we regard as our intellectual property rights. Any of the foregoing could harm our competitive position, business, financial condition, results of operations, and prospects.

We ~~recorded~~utilize open-source software, which may pose particular risks to our proprietary software and solutions.

We use open-source software in our solutions and will use open-source software in the ~~warrant liability at fair value upon issuance as determined by us~~future. Companies that incorporate open-source software into their solutions have, from time to time, faced claims challenging the use of open-source software and compliance with open-source license terms. Some licenses governing the use of open-source software contain requirements that we make available source code for modifications or derivative works we create based upon the open-source software, and that we license such modifications or derivative works under the terms of a ~~valuation report obtained from~~particular open-source

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license or other license granting third parties certain rights of further use. By the terms of certain open-source licenses, we could be required to release the source code of our ~~third-party valuation firm. The warrant liability~~proprietary software, and to make our proprietary software available under open-source licenses to third parties at no cost, if we combine or distribute our proprietary software with open-source software in certain manners. Although we monitor our use of open-source software, we cannot assure you that all open-source software is ~~adjusted for the changes in fair value each period with a charge or credit recognized~~reviewed prior to use in our ~~statement~~solutions, that our developers have not incorporated open-source software into our solutions, or that they will not do so in the future. Additionally, the terms of ~~operations. The impact~~many open-source licenses to which we are subject have not been interpreted by U.S. or foreign courts. There is a risk that open-source software licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to market or provide our solutions as currently marketed or provided. Companies that incorporate open-source software into their products have, in the past, faced claims seeking enforcement of ~~changes~~open-source license provisions and claims asserting ownership of open-source software incorporated into their product. If an author or other third party that distributes such open-source software were to allege that we had not complied with the conditions of an open-source license, we could incur significant legal costs defending ourselves against such allegations. In the event such claims were successful, we could be subject to significant damages or be enjoined from the distribution of our software. In addition, the terms of open-source software licenses may require us to provide source code that we develop using such open-source software to others on unfavorable license terms. As a result of our current or future use of open-source software, we may face claims or litigation, be required to release our proprietary source code, pay damages for breach of contract, re-engineer our solutions, discontinue making our solutions available in ~~fair value~~the event re-engineering cannot be accomplished on ~~earnings, which~~a timely basis, or take other remedial action. Any such re-engineering or other remedial efforts could require significant additional research and development resources, and we may not be ~~material, may~~able to successfully complete any such re-engineering or other remedial efforts. Further, in addition to risks related to license requirements, use of certain open-source software can lead to greater risks than use of third-party commercial software, as open-source licensors generally do not provide warranties or controls on the origin of software. Any of these risks could be difficult to eliminate or manage, and, if not addressed, could have a negative effect on our business, financial condition, and results of operations.

Cyber-attacks and other security breaches could have an adverse effect on ~~the market price of~~ our ~~securities. In addition, potential targets may seek a~~ business, ~~combination partner that does~~

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~~not have warrants that are accounted for as a warrant liability, which may make it more difficult for~~harm our reputation and expose us to ~~consummate an initial business combination with a target business.~~

Weliability.

Computer malware, viruses, physical or electronic break-ins and similar disruptions could lead to interruption and delays in our services and operations and loss, misuse or theft of data or other intellectual property. Computer malware, viruses, ransomware, hacking and phishing attacks against online networks have become more prevalent and may ~~amend~~occur on our systems in the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of at least 50% of the then outstanding public warrants. As a result, the exercise price of your warrants could be increased, the warrants could be converted into cash or stock, the exercise period could be shortened and the number of shares of our Class A common stock purchasable upon exercise of a warrant could be decreased, all without your approval.

Our warrants were issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that (a) the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correct any mistake, including to conform the provisions of the warrant agreementfuture. Due to the ~~description~~political uncertainty involving Russia and Ukraine, there is an increased likelihood that escalation of tensions could result in cyber-attacks or cybersecurity incidents that could either directly or indirectly impact our operations. Any attempts by cyber attackers to disrupt our services or systems, if successful, could harm our business, introduce liability to data subjects, result in the ~~terms~~misappropriation of funds or other intellectual property, be expensive to remedy and damage our reputation or brand. Insurance may not be sufficient to cover significant expenses and losses related to cyber-attacks. Efforts to prevent cyber attackers from entering computer systems are expensive to implement, and we may not be able to cause the ~~warrants and the warrant agreement,~~implementation or ~~defective provision or (ii) adding or changing any provisions~~enforcement of such preventions with respect to ~~matters~~our third-party vendors. Though it is difficult to determine what, if any, harm may directly result from any specific interruption or ~~questions arising~~attack, any failure to maintain performance, reliability, security and availability of systems and technical infrastructure may, in addition to other losses, harm our reputation, brand and ability to attract customers.

We may in the future experience, service disruptions, outages and other performance problems due to a variety of factors, including infrastructure changes, third-party service providers, human or software errors and capacity constraints.

We continue to implement processes and procedures designed to enable us to quickly recover from a disaster or catastrophe and continue business operations. We have tested this capability under controlled circumstances, however, there are several factors ranging from human error to data corruption that could materially impact the ~~warrant agreement as~~efficacy of such processes and procedures, including by lengthening the ~~parties~~time services are partially or fully unavailable to customers and users. It may be difficult or impossible to perform some or all recovery steps and continue normal business operations due to the ~~warrant agreement may deem necessary~~nature of a particular disaster or ~~desirable and that the parties deem to not~~catastrophe, especially during peak periods, which could cause additional reputational damages, or loss of revenues, any of which could adversely affect our business and financial results.

In the ~~rights~~future our energy storage systems and any digital platform that we develop may experience outages and other performance problems due to a variety of factors, including infrastructure changes, third-party service providers, human or software errors and capacity constraints. We may also face changes in our energy storage systems, which could lead to damages, accidents and or system disruptions. We may in the registered holders of the warrants and (b) all other modifications or amendments require the vote or written consent of at least 50% of the then outstanding public warrants and, solely with respect to any amendment to the terms of the private placement warrants or working capital warrantsfuture experience blackmail for our proprietary software or any provision of the warrant agreement with respect to the private placement warrants or working capital warrants, at least 50% of the then outstanding private placement warrants or working capital warrants, respectively. Accordingly,software underpinning any digital platform that we may ~~amend~~develop, which could shut down operation of our systems, those of our potential customers, or cause other damage to such systems.

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Any significant disruption in our computer systems, some of which will be hosted by third-party providers, could damage our reputation and result in negative publicity, which would harm our business and results of operations.

Although the ~~terms~~computer systems for our energy storage systems will strictly be on-premise, we utilize third-party web services for administrative purposes and as a backup for our customers in case there is an on-site system failure. Interruptions, whether due to system failures, human errors, computer viruses, physical or electronic break-ins, denial-of-service attacks, and capacity limitations, could delay or inhibit our operations. Problems, whether real or perceived, with the reliability or security of our systems could prevent us from earning revenue and could harm our reputation. Damage to our reputation, any resulting loss of user confidence and the ~~public warrants in a manner adverse to a holder if holders~~cost of ~~at least 50%~~remedying these problems could negatively affect our business, results of operations, financial condition, and prospects.

We have service agreements with data center providers. Problems with our third-party service providers or with their network providers or with the ~~then outstanding public warrants approve of such amendment. Although~~systems allocating capacity among their users, including us, could adversely affect our ability to ~~amend the terms~~serve our customers or perform our administrative work. Our third-party service providers could decide to close their facilities without adequate notice. Any financial difficulties, such as bankruptcy or reorganization, faced by our third-party service providers or any of the ~~public warrants~~service providers with whom they contract may have negative effects on our business, the ~~consent~~nature and extent of ~~at least 50% of the then outstanding public warrants is unlimited, examples of such amendments could be amendments~~which are difficult to among other things, increase the exercise price of the warrants, convert the warrants into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease the number of shares ofpredict. If our ~~common stock purchasable upon exercise of a warrant.~~

~~We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.~~

We have the ability to redeem outstanding public warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant if, among other things, the last reported sales price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant holders. If and when the warrants become redeemable by us, we may exercise our redemption right even if wethird-party service providers are unable to ~~register or qualify the underlying securities~~keep up with our needs for ~~sale under all applicable state securities laws. As a result, we may redeem the public warrants as set forth above even if the holders are otherwise unable to exercise the warrants.~~

~~Redemption of the outstanding warrants~~capacity, this could force you to: (1) exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so; (2) sell your warrants at the then-current market price when you might otherwise wish to hold your warrants; or (3) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, we expect would be substantially less than the market value of your warrants.

In addition, we have the ability to redeem outstanding public warrants commencing ninety days after they become exercisable and prior to their expiration, at a price of $0.10 per warrant if, among other things, the last reported sale price of our Class A common stock equals or exceeds $10.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) on the trading day prior to the date on which we send the notice of redemption to the warrant holders. In such a case, the holders will be able to exercise their warrants for cash or on a cashless basis prior to redemption and receive that number of shares of Class A common stock determined by reference to the table set forth under “Description of Securities — Warrants — Public Stockholders’ Warrants” based on the redemption date and the “fair market value” of our Class A common stock (as defined below) except as otherwise described in “Description of Securities — Warrants — Public Stockholders’ Warrants.” The value received upon exercise of the warrants (1) may be less than the value the holders would have received if they had exercised their warrants at a later time where the underlying share price is higher and (2) may not compensate the holders for the value of the warrants, including because the number of shares received is capped at 0.361 shares of Class A common stock per warrant (subject to adjustment) irrespective of the remaining life of the warrants.

~~None of the private placement warrants will be redeemable by us so long as they are held by our initial stockholders or their permitted transferees.~~

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~~Our public warrants, founder shares and private placement warrants (including the shares of Class A common stock issuable upon exercise thereof) may~~ have an adverse effect on our business. In the ~~market price~~event that our agreements with any of our ~~Class A common stock~~third-party service providers is terminated, or we add additional cloud infrastructure service providers, we may experience significant costs or downtime in connection with the transfer to, or the addition of, new cloud infrastructure service providers. Any of the above circumstances or events may harm our reputation and ~~make it more difficult~~brand or increase our costs, any of which could adversely affect our business, financial condition, and results of operations.

Our systems include complex software and technology systems and do not have a meaningful history of operation, and there can be no assurance such systems and technology will perform as expected or that software, engineering or other technical defects will not be discovered until after a system is installed and operated by a customer. If our energy storage systems contain manufacturing or construction defects, our business and financial results could be harmed. In addition, the development and updating of these systems will require us to ~~effectuate~~incur potentially significant costs and expenses.

To date, we have built the CDU, but have not yet deployed any fully operational energy storage systems. Once commercial production commences or our ~~initial business combination.~~

~~We issued warrants~~systems are installed and put into use by customers, our products may contain defects in design, manufacture or construction that may cause them not to ~~purchase 9,583,333 shares~~perform as expected or may require repair. An EVx system is unique proprietary technology to Energy Vault, and because one has not yet been fully constructed or deployed, we currently have no frame of reference by which to evaluate the performance of our ~~Class A common stock as part~~EVx systems. Additionally, our energy storage systems will use a substantial amount of software to operate which may require modification and updates over the units sold in the IPO and, simultaneously with the closing of the IPO and an aggregate of 5,166,666 i private placement warrants, each exercisable to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. Our initial stockholders currently hold 7,187,500 founder shares. The founder shares are convertible into shares of Class A common stock on a one-for-one basis, subject to adjustment as set forth herein. In addition, if our founders, affiliates of our founders or certain of our officers and directors make any working capital loans, up to $2,000,000life of such ~~loans may be converted into warrants, at the price of $1.50 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants.~~

~~To the extent we issue shares of Class A common stock to effectuate our initial business combination, the potential for the issuance of a substantial~~systems. Software products are inherently complex and often contain defects and errors when first introduced. These defects and errors can manifest in any number of ~~additional shares of Class A common stock upon exercise of these warrants~~ways in our products, including through diminished performance, security vulnerabilities, malfunctions, or conversion rights could make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number of outstanding shares of our Class A common stock and reduce the value of the Class A common stock issued to complete the business combination. Therefore, our public warrants, founder shares and private placement warrants (including the shares of Class A common stock issuable upon exercise thereof) may makeeven permanently disabled products. Additionally, it ~~more difficult to effectuate a business combination or increase the cost of acquiring the target business.~~

Further, unlike the warrants offered by many other blank check companies, whose warrants become exercisable on the later of (i) 30 days following their initial business combination and (ii) twelve months after the date their initial public offering, our warrants become exercisable 30 days after an initial business combination, even if that date is less than twelve months after our initial public offering. The possibility that our warrants may become exercisable more quickly than the warrants of other blank check companies may make us a less attractive acquisition vehicle in the eyes of a target business relative to other blank check companies and may cause our warrants to have a greater or more immediate adverse effect on the market price for our securities or our ability to obtain future financing. In addition, as our warrants may become exercisable sooner, you may experience dilution to your holdings sooner.

~~A provision of our warrant agreement may make it more~~ difficult for us to ~~consummate an initial business combination.~~

~~Unlike most blank check companies, if (x) we issue additional shares of Class A common stock or equity- linked securities for capital raising purposes in connection with~~evaluate the ~~closing~~manufacturing and construction of our ~~initial business combination at an issue price~~ energy storage systems until there are working examples that have been manufactured, constructed, and used by us and/or ~~effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price~~our customers.

There can be no assurance that we will be able to ~~be determined in good faith by our board of directors~~detect and fix any defects in the ~~case of any such issuance to our initial stockholders~~hardware or their affiliates, without taking into account any founder shares held by our initial stockholders or their affiliates, as applicable, prior to such issuance) (the “newly issued price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the fundingsoftware of our ~~initial business combination on the date of the completion~~energy storage systems, and such defects may not become apparent until a system is installed and operated by a customer. Our energy storage systems may not perform consistent with customers’ expectations or consistent with other energy storage systems which may become available. Any product defects or any other failure of our ~~initial~~energy storage systems to perform as expected could harm our reputation and result in negative publicity, lost revenue, delivery delays, product liability claims and significant warranty and other expenses, and could have a material adverse impact on our business, ~~combination (net~~financial condition, operating results and prospects. Any defects, errors, or other vulnerabilities discovered in our software after release could allow third parties to manipulate or exploit our software, lower revenue, and expose us to claims for damages, any of ~~redemptions),~~which could seriously harm our business. We also could face claims for product liability, tort, or breach of warranty. Defending a lawsuit, regardless of its merit, is costly and ~~(z) the volume weighted average trading price~~may divert management’s attention and seriously harm our reputation and our business.

In addition, further development and updating of our ~~Class A common stock during the 20 trading day period starting on the trading day prior~~energy storage systems will require us to ~~the day on which~~incur potentially significant costs and expenses.

Any failure to offer high-quality technical support services may adversely affect our relationships with our customers and adversely affect our financial results.

As we complete our initial energy storage projects, we anticipate that our customers will depend on our support organization to resolve any technical issues relating to the hardware and software included in our systems. In addition, our sales process is likely to depend highly on the quality of our hardware and software-enabled services, on our business

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reputation, and on strong recommendations from our existing customers. Any failure to maintain high-quality and highly-responsive technical support, or a market perception that we do not maintain high-quality and highly-responsive support, could adversely affect our reputation, our ability to sell our products to existing and prospective customers, and our business, ~~combination (such price,~~financial condition and results of operations.

We intend to offer technical support services alongside our systems. While we have a designated team of engineers to support our customers, they may be unable to respond quickly enough to accommodate short-term increases in demand for support services, particularly as we increase the ~~“Market Value”)~~size of our customer base. We also may be unable to modify the format of our support services to compete with changes in support services provided by competitors. At our current stage, it is ~~below $9.20 per share, the exercise price~~difficult to predict demand for technical support services and if demand were to increase significantly beyond our expectations, we may be unable to provide satisfactory support services to our customers. Additionally, increased demand for these services, without corresponding revenue, could increase costs and adversely affect our business, financial condition and results of ~~the warrants will be adjusted (to the nearest cent)~~operations.

If any of our products are or are alleged to be ~~equal~~defective in design or manufacturing or experience other failures, we may be compelled to ~~115% of the higher of the Market Value~~undertake corrective actions, which could adversely affect our business, prospects, operating results, reputation and ~~the newly issued price,~~financial condition.

Our energy storage systems are complex and ~~the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value~~incorporate technology and ~~the newly issued price. This~~components that may ~~make it more difficult for us to consummate an initial business combination with a target business.~~

~~We may face litigation~~contain design and ~~other risks as a result of the material weakness in our internal control over financial reporting.~~

~~As a result of such material weakness, the change in accounting for the warrants,~~manufacturing-related defects and ~~other matters raised or that~~errors and may in the future ~~be raised by~~contain undetected defects or errors. Additionally, we have limited experience from which to evaluate the SEC, we face potential for litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the material weaknesses in our internal control over financial reporting and the preparationlong-term performance of our ~~financial statements. As of the date of this annual report,~~energy storage systems since we have ~~no knowledge of~~not yet deployed any ~~such litigation or dispute. However, we~~fully operational systems, except for the CDU. There can ~~provide~~be no assurance that we will be able to detect and fix any defects in any of our energy storage system systems prior to the sale to potential consumers.

Generally, we do not manufacture the components of our energy storage systems and we rely on suppliers and subcontractors to manufacture such ~~litigation or dispute will not arise~~components. We provide installation, construction, and commissioning services for our customers that purchase our products. Although we have implemented quality control initiatives to help prevent defects and issues, defects and issues may still occur in the ~~future. Any~~future that may result in significant expenses or disruptions of our operations.

Since we do not manufacture certain components of our energy storage systems, our ability to seek recourse for liabilities and recover costs from our suppliers and subcontractors depends on our contractual rights as well as the financial condition and integrity of such ~~litigation or dispute, whether successful~~suppliers and subcontractors. Furthermore, our suppliers and subcontractors may be unable or not required to correct manufacturing defects or other failures of such components of our energy storage systems in a manner satisfactory to our customers, which could adversely affect customer satisfaction, market acceptance, and our business reputation.

For example in a GESS system, mobile masses may fall or the system may otherwise fail to perform as expected. For BESSs, on rare occasions, lithium-ion batteries can rapidly release the energy they contain by venting smoke and flames in a manner that can ignite nearby materials as well as other lithium-ion batteries. Any defective performance could subject us to lawsuits, product recalls, or redesign efforts, all of which would be time consuming and expensive. Additionally, negative public perception regarding the suitability of the components in our energy applications could adversely affect our business and reputation.

Any defects or errors in product or services offerings, or the perception of such defects or errors, or other performance problems could result in any of the following, each of which could adversely affect our business, financial condition, and results of operations:

•expenditure of significant financial and product development resources, including recalls, in efforts to analyze, correct, eliminate, or work around errors or defects;

•significant re-engineering work;

•loss of existing or potential customers or partners;

•interruptions or delays in sales;

•delayed or lost revenue;

•delay or failure to attain market acceptance;

•delay in the development or release of new functionality or improvements;

•negative publicity and reputational harm;

•sales credits or refunds;

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•security vulnerabilities, data breaches, and exposure of confidential or proprietary information;

•diversion of development and customer service resources;

•breach of warranty claims;

•legal claims and regulatory actions under applicable laws, rules, and regulations; and

•the expense and risk of litigation.

Risks Related to Government Regulation

Our future financial performance may depend on the continued availability of rebates, tax credits and other financial incentives. The reduction, modification, or elimination of government economic incentives could cause our revenue to decline and harm our financial results.

U.S. federal, state, local and foreign governments provide incentives to end users in the form of rebates, tax credits, and other financial incentives, such as system performance payments and payments for renewable energy credits associated with renewable energy generation. The range and duration of these incentives varies widely by jurisdiction. Our business may rely on these governmental rebates, tax credits, and other financial incentives to significantly lower the effective price of our energy storage systems for our customers. However, these incentives may expire on a particular date, end when the allocated funding is exhausted, or be reduced or terminated as a matter of regulatory or legislative policy. These reductions or terminations may occur without warning. The reduction, elimination, or expiration of such incentives therefore could harm our business and cash flows.

In August 2022, the United States passed the IRA, which includes a number of government incentives that support the adoption of energy storage products and services and are anticipated to benefit the Company and its operations. Forthcoming guidance to implement the IRA from the U.S. Department of Treasury and other federal administrative agencies could be drafted in such manner that would not be as anticipated and may be adverse to the Company’s interests.

We could be liable for environmental damage resulting from our operations, which could impact our reputation, our business, and our operating results.

We are subject to environmental, health, and safety laws and regulations in jurisdictions in which we operate, including those governing disposal of hazardous materials and wastes. Environmental laws and regulations can be complex and often change. These laws can give rise to strict, joint and several liability for administrative oversight costs, cleanup costs, property damage, bodily injury, fines, and penalties. Capital and operating expenses needed to comply with environmental laws and regulations can be significant, and violations may result in substantial fines and penalties or third-party damages.

Our operations involve the use of hazardous, flammable, and explosive materials in our battery and green hydrogen storage solutions. Our operations also produce hazardous wastes. We cannot eliminate the risk of contamination or injury from the generation, transportation, or disposal of such materials. In the event of contamination or injury resulting from our or our third party manufacturers’ use of, or associated with the transportation or disposal of, hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties. We maintain workers’ compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from exposure to hazardous materials with a policy limit that we believe is customary for similarly situated companies and adequate to provide us with insurance coverage for foreseeable risks; however, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal hazardous materials.

In addition, maintaining compliance with applicable environmental laws requires significant time and management resources and could cause delays in our ability to build out, equip and operate our facilities as well as service our fleet, which would adversely impact our business, our prospects, our financial condition, and our operating results. In addition, environmental laws and regulations such as the Comprehensive Environmental Response, Compensation and Liability Act in the United States impose liability on several grounds including for the investigation and cleanup of contaminated soil and ground water, for building contamination, for impacts to human health and for damages to natural resources. If contamination is discovered in the future at properties formerly owned or operated by us or currently owned or operated by us, or properties to which hazardous substances were sent by us, it could result in us incurring liability under environmental laws and regulations. As noted above, such liability can be strict, joint and several.

Many of our customers who have agreed to purchase our energy storage systems have high sustainability standards, and any environmental noncompliance by us could harm our reputation and impact a current or potential customer’s buying decision. Additionally, in many cases we contractually commit to performing all necessary installation work on a fixed-price basis, and unanticipated costs associated with environmental remediation and/or compliance expenses may cause the

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cost of performing such work to exceed our revenue. The costs of complying with environmental laws, regulations, and customer requirements, and any claims concerning noncompliance or liability with respect to contamination in the future, could have a material adverse effect on our financial condition or our operating results.

Action by governmental authorities and local residents to restrict construction or use of our systems in their localities could substantially harm our business and financial results.

In the United States and elsewhere, the construction and implementation of our systems is subject to local laws, regulations, rules and agreements regarding zoning, permitting and land use. From time to time, various interest groups lobby for or against amendments to such rules that would allow potential customers to implement our systems in locations desirable to them. In certain cases, potential customers may need to petition for changes or waivers to such rules in order to be allowed to implement our systems. In all cases, governmental authorities and local residents may oppose the implementation of our systems by our potential customers, which could cause delays, potential damage to our relationships with customers and increased costs to us and our customers. If laws, regulations, rules, or agreements significantly restrict or discourage our potential customers in certain jurisdictions from purchasing and implementing our systems, it would have a material adverse effect on our business, results of operations, and financial ~~condition or our ability to complete a business combination.~~

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~~General Risks~~

If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination.

~~If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:~~

●~~restrictions on the nature of our investments; and~~

●~~restrictions on the issuance of securities; each of which may make it difficult for us to complete our initial business combination.~~condition. In addition, ~~we may have imposed upon us burdensome requirements, including:~~

●~~registration as an investment company with the SEC;~~

●~~adoption~~there can be no assurance that future macroeconomic pressures and public policy concerns could continue to lead to new laws and regulations, or interpretations of ~~a specific form of corporate structure; and~~

●~~reporting, record keeping, voting, proxy and disclosure requirements and compliance with other rules~~existing laws and regulations, that ~~we are currently not subject to.~~

In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business other than investing, reinvesting or trading of securities and thatwould limit our ~~activities do not include investing, reinvesting, owning, holding or trading “investment securities” constituting more than 40%~~future customers’ use of our ~~total assets (exclusive~~systems.

Laws, regulations and rules relating to privacy, information security, and data protection could increase our costs and adversely affect our business opportunities. In addition, the ongoing costs of ~~U.S. government securities~~complying with such laws, regulations and ~~cash items) on an unconsolidated basis. Our business~~rules could be significant.

We are subject to various laws regarding privacy, information security and data protection. In particular, our handling of data relating to individuals is subject to ~~identify~~a variety of laws and ~~complete a business combination~~regulations relating to privacy, data protection, and ~~thereafter~~information security, and it may become subject to ~~operate~~additional obligations, including contractual obligations, relating to our maintenance and other processing of this data. For example, the ~~post-transaction business~~European Union’s General Data Protection Regulation, or ~~assets~~GDPR, imposes stringent data protection requirements and provides for significant penalties for noncompliance. Laws, regulations, and other actual and potential obligations relating to privacy, data protection, and data security are evolving rapidly, and the regulatory landscape regarding privacy, data protection, and data security is likely to remain uncertain for the ~~long term.~~foreseeable future. We ~~do not plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.~~

We do not believe that our principal activities subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank or private equity fund), we intend to avoid being deemed an “investment company” within the meaning of the Investment Company Act.

The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the completion of our primary business objective, which is a business combination; (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 8, 2023 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity; and (iii) absent a business combination, our return of the funds held in the trust account to our public stockholders as part of our redemption of the public shares. If we do not continue to invest the proceeds as discussed above, we may be deemedexpect to be subject to new laws and regulations, or new interpretations of laws and regulations, in the ~~Investment Company Act.~~future in various jurisdictions. These laws, regulations, and other obligations, and changes in their interpretation, could require us to modify our operations and practices, restrict our activities, and increase our costs in the future, and it is possible that these laws, regulations, and other obligations may be inconsistent with one another or be interpreted or asserted to be inconsistent with our business or practices. Any inability to adequately address privacy and security concerns or comply with applicable privacy and information security laws, rules and regulations could have an adverse effect on our business, prospects, results of operations, financial position and reputation.

We are subject to anti-bribery, anti-corruption, including the U.S. Foreign Corrupt Practices Act, as well as export control laws, customs laws, sanctions laws and other laws governing our operations. If we ~~were deemed~~fail to comply with these laws, we could be subject to ~~the Investment Company Act, compliance with these additional regulatory burdens~~civil or criminal penalties, other remedial measures and legal expenses, any of which would require additional expenses for which we have not allotted funds and may hinder our ability to consummate our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.00 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.00 per share on the redemption of their shares. Please see “— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.00 per share” and other risk factors herein.

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~~Changes in laws or regulations, or a failure to comply with any laws and regulations, may~~ adversely affect our business, ~~including our ability to negotiate and complete our initial business combination,~~financial condition and results of operations.

We are subject to anti-corruption, anti-bribery, and other similar laws and regulations ~~enacted by national, regional and local governments. In particular,~~in various jurisdictions in which we ~~will be required to comply with certain SEC~~operate, including the U.S. Foreign Corrupt Practices Act (“FCPA”), and other ~~legal requirements. Compliance with,~~anti-corruption laws and ~~monitoring~~regulations. These laws generally prohibit us and our officers, directors, employees and business partners acting on our behalf, including agents, from corruptly offering, promising, authorizing or providing anything of ~~applicable~~value to obtain or retain business or otherwise obtain favorable treatment and require companies to maintain accurate books and records and a system of internal controls or adequate procedures to prevent bribery.

We are also subject to economic sanctions laws, export control laws and regulations, as well as customs regulations, in the various jurisdictions in which we operate, including those administered and enforced by the U.S. Department of Treasury’s Office of Foreign Assets Control, the U.S. Department of State, the U.S. Department of Commerce, His Majesty’s Treasury of the United Kingdom, the United Nations Security Council, the European Union (and its member states) and other relevant sanctions authorities.

We have implemented and maintain policies and procedures designed to promote compliance by us and our directors, officers, employees, representatives, consultants and agents with the FCPA, the Bribery Act and other anti-corruption laws, as well as economic sanctions and export controls.We cannot assure you, however, that any such policies and procedures will be sufficient or that directors, officers, employees, representatives, consultants and agents have not engaged, and will not engage, in conduct for which we may be ~~difficult, time consuming~~held responsible, nor can we assure you that our business partners have not engaged, and ~~costly. Those~~will not engage, in conduct that could materially affect their ability to perform their contractual obligations to

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us or result in our being held liable for such conduct. Violations of the FCPA, Bribery Act, other anti-corruption laws, economic sanctions, export control laws and/or anti-money laundering and anti-terrorism laws or regulations may result in severe criminal or civil sanctions, and ~~their interpretation and application~~we may ~~also change from time~~be subject to ~~time and those changes~~other liabilities, which could have a material adverse effect on our business, ~~investments~~financial condition and results of operations.

Changes in regulatory enforcement policies and priorities may negatively impact the management of our business, results of operations, and ability to compete.

Energy and environmental regulation is constantly changing, and policy or changes in enforcement of existing laws or regulations applicable to our business, or reexamination of current practices, could adversely impact our profitability, limit our ability to continue existing or pursue new business activities, require us to change certain of our business practices, affect retention of key personnel, or expose us to additional costs (including increased compliance costs and/or customer remediation). These changes also may require us to invest significant resources, and devote significant management attention, to make any necessary changes and could adversely affect our business. The Company’s Project Development Group conducts required environmental impact and sustainability studies prior to any storage project commitment.

We are subject to licensing and operational requirements that result in substantial compliance costs, and our business would be adversely affected if we fail to obtain or maintain required licenses or if our licenses are impaired.

Our business is subject to numerous federal, state, and local laws and regulations. In ~~addition,~~particular, our business is subject to oversight and regulation under local ordinances, building, zoning and fire codes, environmental protection regulation, utility interconnection requirements, and other rules and regulations. Such licenses often require us to operate in ways that incur substantial compliance costs.

To date, we have not deployed any fully operational energy storage systems, other than the CDU. We have obtained certain permits and are in the process of obtaining additional permits for the energy storage systems that we are constructing. Although we have obtained certain required permits and believe that obtaining and renewing any remaining certificates and/or licenses will be routine, we can provide no assurance that all required certificates and/or licenses will be obtained or renewed in a timely manner. Our failure to hold a given license or certificate would impair our ability to perform our obligations under our customer contracts. The number of laws affecting our business continues to grow. If our licenses or certificates were impaired, whether by expiration, nonrenewal or modification or termination, our business would be adversely impaired.

We can give no assurances that we will properly and timely comply with all laws and regulations that may affect us. If we fail to comply with ~~applicable~~these laws and regulations, we may be subject to legal penalties, which would adversely affect our business, prospects, and results of operations.

In addition, governments, often acting through state utility or public service commissions, change or adopt different rates for commercial customers on a regular basis. These changes could affect our ability to deliver cost savings to future customers for the purchase of our energy storage systems.

Litigation, regulatory actions and compliance issues could subject us to significant fines, penalties, judgments, remediation costs, negative publicity and requirements resulting in increased expenses.

We have been and continue to be involved in legal proceedings, administrative proceedings, claims and other litigation that arise in the ordinary course of business. In addition, since our energy storage system is a new type of product in a nascent market, we may in the future need to seek the amendment of existing regulations or, in some cases, the creation of new regulations, in order to operate our business in some jurisdictions. Such regulatory processes may require public hearings concerning our business, which could expose us to subsequent litigation.

Unfavorable outcomes or developments relating to proceedings to which we are a party or transactions involving our products, such as ~~interpreted and applied,~~judgments for monetary damages, injunctions, or denial or revocation of permits, could have a material adverse effect on our business, ~~including our ability to negotiate and complete our initial business combination,~~financial condition, and results of operations.

We To the extent such proceedings also generate negative publicity, our reputation and business could also be adversely affected. In addition, handling compliance issues and the settlement of claims could adversely affect our financial condition and results of operations.

Government reviews, inquiries, investigations, and actions could harm our business or reputation.

As we operate in various locations around the world, our operations in certain countries are subject to significant governmental scrutiny and may ~~issue additional shares~~be adversely impacted by the results of ~~Class A common stock~~such scrutiny. The regulatory environment with regard to our business is evolving, and officials often exercise broad discretion in deciding how to interpret and apply applicable regulations. From time to time, we receive formal and informal inquiries from various government regulatory authorities, as well as self-regulatory organizations, about our business and compliance with local laws, regulations or ~~preferred stock to complete~~standards.

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Any determination that our ~~initial business combination~~operations or ~~under an employee incentive plan after completion~~activities, or the activities of our ~~initial~~employees, are not in compliance with existing laws, regulations or standards could result in the imposition of substantial fines, interruptions of business, ~~combination. We~~loss of supplier, vendor, customer or other third-party relationships, termination of necessary licenses and permits, or similar results, all of which could potentially harm our business and/or reputation. Even if an inquiry does not result in these types of determinations, regulatory authorities could cause us to incur substantial costs or require us to change our business practices in a manner materially adverse to our business, and it potentially could create negative publicity which could harm our business and/or reputation.

Risks Related to Ownership of Energy Vault’s Securities

Concentration of ownership among our executive officers, directors, and their affiliates may ~~also issue shares~~prevent new investors from influencing significant corporate decisions.

As of ~~Class A common stock upon the conversion of the Class B common stock at~~December 31, 2022, our executive officers, directors and their affiliates as a ~~ratio greater than one-to-one at the time~~group beneficially own approximately 38.4% of our ~~initial business combination as~~outstanding common stock. As a result, these stockholders are able to exercise a significant level of control over all matters requiring stockholder approval, including the election of directors, appointment and removal of officers, any amendment of the ~~anti-dilution provisions described herein. Any such issuances would dilute the interest of our stockholders and likely present other risks.~~

~~Our~~ amended and restated certificate of incorporation ~~authorizes the issuance~~and approval of ~~up to 500,000,000 shares of Class A common stock, par value $0.0001 per share,~~mergers and 20,000,000 shares of Class B common stock, par value $0.0001 per share and 5,000,000 shares of undesignated preferred stock, par value $0.0001 per share. As of the date of this annual report, there are 456,450,001 and 12,812,500 authorized but unissued shares of Class A and Class B common stock available, respectively, for issuance, which amount takes into account shares reserved for issuance upon exercise of outstanding warrants but not upon the conversion of the Class B common stock. Shares of Class B common stock are automatically convertible into shares of our Class A common stock at the time of our initialother business combination ~~or earlier at the option of the holder, initially at a one-for-one ratio but subject to adjustment as set forth herein. There will be no shares of preferred stock issued and outstanding.~~

We may issue a substantial number of additional shares of Class A common stock, and may issue shares of preferred stock, in order to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue shares of Class A common stock to redeem the warrants as described in “Description of Securities — Warrants — Public Stockholders’ Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00” or upon conversion of the Class B common stock at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions described herein. However, our amended and restated certificate of incorporation provides, among other things, that prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (1) receive funds from the trust account or (2) vote pursuant to our amended and restated certificate of incorporation on any initial business combination or any amendments to our amended and restated certificate of incorporation. The issuance of additional shares of common or preferred stock:

●may significantly dilute the equity interest of holders of Class A common stock, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the Class B common stock;

●~~may subordinate the rights of holders of common stock if preferred stock is issued with rights senior to those afforded our common stock;~~

●~~could cause a change of~~transactions requiring stockholder approval. This control ~~if a substantial number of shares of our common stock is issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and~~ could ~~result in the resignation or removal of our present officers and directors;~~

●~~may~~ have the effect of delaying or preventing a change of control ~~of us by diluting the stock ownership~~ or ~~voting rights of a person seeking to obtain control of us;~~

●~~may adversely affect prevailing market prices for our units, Class A common stock and/or warrants;~~changes in management and

●~~may not result in adjustment to the exercise price of our warrants.~~

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Certain provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the release of funds from our trust account) may be amended with will make the approval of holders of at least 65% of our outstanding common stock, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation andcertain transactions difficult or impossible without the ~~trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support.~~

Some other blank check companies have a provision in their charter which prohibits the amendment of certain of its provisions, including those which relate to a company’s pre-business combination activity, without approval by holders of a certain percentage of the company’s stockholders. In those companies, amendmentsupport of these ~~provisions typically requires approval by holders holding between 90%~~stockholders.

The Company qualifies as an “emerging growth company” and 100% of the company’s public shares. Our amended and restated certificate of incorporation provides that any of its provisions (other than amendments relating to the appointment or removal of directors prior to our initial business combination, which require the approval by holders of a majority of at least 90% of the outstanding shares of our common stock voting at a stockholder meeting) related to pre-business combination activity (including the requirement to hold proceeds of the IPO and the sale of the private placement warrants into the trust account and not release such amounts except in specified circumstances and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of at least 65% of our outstanding common stock, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our outstanding common stock. Unless specified in our amended and restated certificate of incorporation or bylaws, or as required by applicable law or stock exchange rules, the affirmative vote of a majority of the outstanding shares of our common stock that are voted is required to approve any such matter voted on by our stockholders, and, prior to our initial business combination, the affirmative vote of holders of a majority of the outstanding shares of our Class B common stock is required to approve the election or removal of directors. We may not issue additional securities that can vote pursuant to our amended and restated certificate of incorporation on any initial business combination or any amendments to our amended and restated certificate of incorporation. Our initial stockholders, who beneficially own 20.0% of our common stock, may participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated certificate of incorporation which will govern our pre-business combination behavior more easily than some other blank check companies, and this may increase our ability to complete our initial business combination with which you do not agree.

Our initial stockholders, officers and directors have agreed, pursuant to a written agreement, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 8, 2023 or (B) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares. These agreements are contained in a letter agreement that we have entered into with our initial stockholders, officers and directors. Our public stockholders are not parties to, or third- party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our initial stockholders, officers or directors for any breach of these agreements. As a result, in the event of a breach, our public stockholders would need to pursue a stockholder derivative action, subject to applicable law.

~~Certain agreements with our initial stockholders, officers and directors may be amended without stockholder approval.~~

Certain agreements, including the letter agreement among us and our initial stockholders, officers and directors and the registration rights agreement among us and our initial stockholders may be amended without stockholder approval. These agreements contain various provisions, including transfer restrictions on our founder shares and private placement warrants and the securities included therein, that our public stockholders might deem to be material. While we do not expect our board of directors to approve any amendment to any of these agreements prior to our initial business combination, it may be possible that our board of directors, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to any such agreement in connection with the consummation of our initial business combination. Any such amendments would not require approval from our stockholders, may result in the completion of our initial business combination that may not otherwise have been possible, and may have an adverse effect on the value of an investment in our securities.

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~~We are an emerging growth company and a smaller~~“smaller reporting ~~company~~company” within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies, ~~or smaller reporting companies, this~~which could make our securities less attractive to investors and may make it more difficult to compare our performance ~~with~~to the performance of other public companies.

We ~~are~~qualify as an “emerging growth company” ~~within the meaning~~as defined in Section 2(a)(19) of the Securities Act, as modified by the JOBS ~~Act,~~Act. As such, the Company is eligible for and ~~we may~~intends to take advantage of certain exemptions from various reporting requirements ~~that are~~ applicable to other public companies that are not emerging growth companies for as long as it continues to be an emerging growth company, including ~~but not limited to, not being required to comply with~~(a) the exemption from the auditor attestation requirements ofwith respect to internal control over financial reporting under Section ~~404~~404(b) of the Sarbanes-Oxley Act, (b) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (c) reduced disclosure obligations regarding executive compensation in ~~our~~its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders may not have access to certain information they may deem important. We could bestatements. The Company will remain an emerging growth company ~~through 2026, although circumstances could cause us to lose that status earlier, including if~~until the earliest of (i) the last day of the fiscal year in which the market value of our common stock that is held by non-affiliates exceeds $700 million as of June 30 of that fiscal year, (ii) the ~~end~~last day of ~~any second quarter of a~~the fiscal year in which ~~case~~ we ~~would no longer be~~have total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which we have issued more than $1 billion in non-convertible debt in the prior three-year period or (iv) December 31, 2026. In addition, Section 107 of the JOBS Act also provides that an emerging growth company ascan take advantage of the end of such fiscal year. We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.

~~Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies~~exemption from ~~being required to comply~~complying with new or revised ~~financial~~accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as the Company is an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until ~~private companies (that is,~~ those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements thatstandards would otherwise apply to ~~non-emerging growth companies but any such election to opt out is irrevocable.~~private companies. We have elected not to opt out of such extended transition period ~~which means that when a standard is issued~~and, therefore, the Company may not be subject to the same new or revised ~~and it has different application dates for~~accounting standards as other public ~~or private~~ companies ~~we,~~that are not emerging growth companies.

Even after the Company no longer qualifies as an emerging growth company, ~~can adopt the new or revised standard at the time private companies adopt the new or revised standard. This~~we may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

~~Additionally, we are~~still qualify as a “smaller reporting ~~company” as defined~~company,” which would allow it to continue to take advantage of many of the same exemptions from disclosure requirements, including not being required to comply with the auditor attestation requirements, Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in ~~Item 10(f)(1) of Regulation S-K. Smaller~~its periodic reports and proxy statements. Moreover, smaller reporting companies may ~~take advantage of certain reduced disclosure obligations, including, among other things, providing~~choose to present only the two most recent fiscal years of audited financial ~~statements. We~~statements in their Annual Reports on Form 10-K.

Investors may find the Company’s common stock less attractive because the Company will ~~remain~~rely on these exemptions, which may result in a ~~smaller reporting company until~~less active trading market for our common stock and its price may be more volatile.

There can be no assurance that our common stock will be able to continue to comply with the ~~last day~~continued listing standards of the ~~fiscal year in which (1) the market value~~NYSE.

The shares of our common stock ~~held~~and warrants are listed on the NYSE. If the NYSE delists the common stock from trading on its exchange for failure to meet the listing standards, we and our stockholders could face significant material adverse consequences including:

•a limited availability of market quotations for our securities

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•a determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our common stock;

•a limited amount of analyst coverage; and

•a decreased ability to issue additional securities or obtain additional financing in the future.

We expect to continue incurring significant increased expenses and administrative burdens as a public company, which could negatively impact our business, financial condition and results of operations.

We expect to continue incurring increased legal, accounting, administrative and other costs and expenses as a public company. We expect such costs and increases to be increased further after we are no longer an emerging growth company. The Sarbanes-Oxley Act, including the requirements of Section 404, as well as rules and regulations subsequently implemented by ~~non-affiliates exceeds $250 million~~the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the Public Company Accounting Oversight Board and the securities exchanges, impose additional reporting and other obligations on public companies. Compliance with public company requirements will increase costs and make certain activities more time-consuming. A number of those requirements require us to carry out activities we have not done previously. In addition, expenses associated with SEC reporting requirements are being incurred. Furthermore, if any issues in complying with those requirements are identified (for example, if the auditors identify a significant deficiency or material weaknesses in the internal control over financial reporting), we could incur additional costs to rectify those issues, and the existence of those issues could adversely affect our reputation or investor perceptions.

In addition, we maintain director and officer liability insurance, which has substantial premiums. Advocacy efforts by stockholders and third parties may also prompt additional changes in governance and reporting requirements, which could further increase costs.

If, securities or industry analysts cease publishing research or reports about the Company, its business, or its market, or if they change their recommendations regarding the Company’s securities adversely, the price and trading volume of the Company’s securities could decline.

Research and reports that industry or securities analysts publish about the Company, its business, market or competitors may influence the public market for our securities. If securities or industry analysts cease coverage of the Company, the price and trading volume of our publicly traded securities would likely be negatively impacted. If any of the analysts who may cover the Company adversely change their recommendation regarding our securities, or provide more favorable relative recommendations about our competitors, the price of the our publicly traded securities would likely decline. If any analyst who may cover the Company were to cease coverage of the Company or fail to regularly publish reports on us, the Company could lose visibility in the financial markets, which in turn could cause the price or trading volume of our publicly traded securities to decline.

Because we have no current plans to pay cash dividends on the Company’s common stock for the foreseeable future, you may not receive any return on investment unless you sell the Company’s common stock for a price greater than that which you paid for it.

The Company may retain future earnings, if any, for future operations, expansion and debt repayment and has no current plans to pay any cash dividends for the foreseeable future. Any decision to declare and pay dividends will be made at the discretion of the Company’s Board and will depend on, among other things, the Company’s results of operations, financial condition, cash requirements, contractual restrictions and other factors that the Company’s Board may deem relevant. In addition, the Company’s ability to pay dividends may be limited by covenants of any existing and future outstanding indebtedness it or its subsidiaries incur. As a result, you may not receive any return on an investment in the Company’s common stock unless you sell your shares of common stock for a price greater than that which you paid for it.

The Company may issue additional shares of common stock or other equity securities without your approval, which would dilute your ownership interests and may depress the market price of the Company’s common stock.

As of June 30, 2022, the Company had warrants outstanding to purchase an aggregate of 14,067,051 shares of common stock. As of December 31, 2022, following the redemption in full of our public warrants, only 5,166,666 of private warrants remain outstanding. In addition, as of December 31, 2022, the ~~end~~Company was able to issue an aggregate of ~~that year’s second fiscal quarter,~~up to 23,768,666 shares of common stock pursuant to our 2022 Equity Incentive Plan and 8,000,000 shares of common stock pursuant to our 2022 Employment Inducement Plan (the “2022 Inducement Plan”), which amounts may be subject to increase from time to time. The Company may also issue additional shares of common stock or ~~(2) our annual revenues exceeded $100 million during such completed fiscal year~~other equity securities of equal or senior rank in the future in connection with, among other things, future acquisitions or repayment of outstanding indebtedness, without stockholder approval, in a number of circumstances.

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The issuance of additional shares or other equity securities of equal or senior rank would have the following effects:

•existing stockholders’ proportionate ownership interest in the Company will decrease;

•the amount of cash available per share, including for payment of dividends in the future, may decrease;

•the relative voting strength of each previously outstanding share of common stock may be diminished; and

•the market ~~value~~price of the Company’s common stock may decline.

Our stock price may be volatile or may decline regardless of our operating performance. You may lose some or all of your investment.

The trading price of our common stock ~~held~~is likely to be volatile. The stock market recently has experienced extreme volatility. This volatility often has been unrelated or disproportionate to the operating performance of particular companies. You may not be able to resell your shares at an attractive price due to a number of factors such as the following:

•our operating and financial performance and prospects;

•our quarterly or annual earnings or those of other companies in our industry compared to market expectations;

•conditions that impact demand for our services;

•future announcements concerning our business, our customers’ businesses, or our competitors’ businesses;

•the public’s reaction to our press releases, other public announcements, and filings with the SEC;

•the market’s reaction to our reduced disclosure and other requirements as a result of being an “emerging growth company” under the JOBS Act or a “smaller reporting company”;

•the size of our public float;

•coverage by ~~non-affiliates exceeds $700 million~~or changes in financial estimates by securities analysts or failure to meet their expectations;

•market and industry perception of our success, or lack thereof, in pursuing our growth strategy;

•strategic actions by us or our competitors, such as acquisitions or restructurings;

•changes in laws or regulations which adversely affect the energy storage industry generally or Energy Vault specifically;

•changes in accounting standards, policies, guidance, interpretations, or principles;

•impacts from bank failures, reducing the financing options for the Company and its customers and suppliers;

•changes in senior management or key personnel;

•issuances, exchanges or sales, or expected issuances, exchanges, or sales of our capital stock;

•changes in our dividend policy;

•sales of shares of our common stock by significant shareholders;

•adverse resolution of new or pending litigation against us; and

•changes in general market, economic, and political conditions in the United States and global economies or financial markets, including those resulting from inflation including the effects of upward changes to the interest rate curves, natural disasters, terrorist attacks, acts of war, and responses to such events.

These broad market and industry factors may materially reduce the market price of our securities, regardless of our operating performance. In addition, price volatility may be greater if the public float and trading volume of the ~~end~~common stock is low. As a result, you may suffer a loss on your investment.

If we fail to maintain proper and effective internal control over financial reporting as a public company, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline.

Pursuant to Section 404 of the Sarbanes-Oxley Act, the report by management on internal control over financial reporting is on our financial reporting and internal controls. The rules governing the standards that ~~year’s second fiscal quarter.~~must be met for management to assess internal control over financial reporting are complex and require significant documentation, testing and possible remediation. To comply with the ~~extent~~Sarbanes-Oxley Act, the requirements of being a reporting company under the Exchange Act and any complex accounting rules in the future, we ~~take advantage~~may need to upgrade our information technology systems;

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implement additional financial and management controls, reporting systems and procedures; and hire additional accounting and finance staff.

If we are unable to hire the additional accounting and finance staff necessary to comply with these requirements, we may need to retain additional outside consultants. If we, or our independent registered public accounting firm are unable to conclude that our internal control over financial reporting is effective, investors may lose confidence in our financial reporting, which could negatively impact the market price of our common stock.

Activist stockholders may attempt to effect changes to our company, which could adversely affect our corporate governance, results of operations, and financial condition.

Campaigns by stockholders to effect changes at publicly traded companies are sometimes led by investors through various corporate actions, including Board nominations and proxy contests. We may become subject to one or more campaigns by stockholders who desire to increase stockholder value in the short term. If we become engaged in a proxy contest with an activist stockholder in the future, our business and operations could be adversely affected as responding to such ~~reduced disclosure obligations,~~contests or other activist stockholder actions would be costly and time-consuming, and we would expect that such actions would disrupt our operations and divert the attention of management and our employees from executing our strategic plans and product launch. In addition, if individuals are elected to our Board with a specific agenda or without relevant experience or expertise, it may ~~also make comparison~~adversely affect the ability of the Board to function effectively, as well as our ability to effectively and timely implement our strategic plans, which are focused on building shareholder value. Any perceived uncertainties as to our future direction as a result of stockholder activism or changes to the composition of our ~~financial statements~~Board may lead to the perception of a change in the direction of our business and instability or lack of continuity with ~~other public companies~~respect to our products which may cause concerns for our customers or be exploited by our competitors. As a result, we could experience significant volatility and a decline of our stock price, the loss of potential business opportunities and difficulties in attracting and retaining qualified personnel and customers.

Anti-takeover provisions in our certificate of incorporation, our bylaws and under Delaware law could make an acquisition of the Company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or ~~impossible.~~

~~Compliance obligations under~~remove the ~~Sarbanes-Oxley Act~~Company’s current management.

Our certificate of incorporation and our bylaws contain provisions that may delay or prevent an acquisition of the Company or a change in its management. These provisions may make it more difficult for usstockholders to ~~effectuate our initial business combination, require substantial financial and management resources, and increase~~replace or remove members of its Board. Because the ~~time and costs of completing an acquisition.~~

~~Section 404~~Board is responsible for appointing the members of the ~~Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls.. Only~~management team, these provisions could in ~~the event we are deemed~~turn frustrate or prevent any attempt by its stockholders to ~~be a large accelerated filer~~replace or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial business combination may not be in compliance with theremove its current management. In addition, these provisions ~~of the Sarbanes-Oxley Act regarding adequacy of its internal controls.~~

~~The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition.~~

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~~Provisions in our amended and restated certificate of incorporation and Delaware law may inhibit a takeover of us, which~~ could limit the price that investors might be willing to pay in the future for ~~our Class A~~shares of Company common ~~stock~~stock. Among other things, these provisions include:

•the limitation of the liability of, and ~~could entrench management.~~

~~Our amended~~the indemnification of, its directors and ~~restated certificate~~officers;

•a prohibition on actions by its stockholders except at an annual or special meeting of ~~incorporation contains provisions that may discourage unsolicited takeover proposals that~~stockholders;

•a prohibition on actions by its stockholders ~~may consider to be in their best interests. These provisions include staggered board of directors,~~ by written consent; and

•the ability of the ~~board of directors~~Board to ~~designate~~issue preferred stock without stockholder approval, which could be used to institute a “poison pill” that would work to dilute the ~~terms of and issue new series of preferred shares, and the fact that prior to the completion of our initial business combination only holders of our shares of Class B common~~ stock which are held by our initial stockholders, are entitled to vote on the election of directors, which may make more difficult the removal of management and may discourage transactions that otherwise could involve paymentownership of a ~~premium over prevailing market prices~~potential hostile acquirer, effectively preventing acquisitions that have not been approved by the Board.

Moreover, because the Company is incorporated in Delaware, it is governed by the provisions of Section 203 of the DGCL, which prohibits a person who owns 15% or more of its outstanding voting stock from merging or combining with the Company for ~~our securities.~~

~~We are also subject to anti-takeover provisions under Delaware law,~~a period of three years after the date of the transaction in which the person acquired 15% or more of the Company’s outstanding voting stock, unless the merger or combination is approved in a prescribed manner. This could discourage, delay or prevent a ~~change~~third party from acquiring or merging with the Company, whether or not it is desired by, or beneficial to, its stockholders. This could also have the effect of ~~control. Together these provisions may make more difficult~~discouraging others from making tender offers for the ~~removal of management and may discourage~~Company’s common stock, including transactions ~~that otherwise could involve payment of a premium over prevailing market prices for our securities.~~

~~Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings~~ that may be ~~initiated by our stockholders, which could limit our~~in its stockholders’ ~~ability to obtain a favorable judicial forum~~best interests. Finally, these provisions establish advance notice requirements for ~~disputes with our company or our company’s directors, officers or other employees.~~

~~Our amended and restated certificate of incorporation provides that, unless we consent in writing~~nominations for election to the ~~selection of an alternative forum,~~Board or for proposing matters that can be acted upon at stockholder meetings. These provisions would apply even if the ~~Court of Chancery of the State of Delaware shall, to the fullest extent permitted~~offer may be considered beneficial by law, be the sole and exclusive forum for any (1) derivative action or proceeding brought on behalf of our company, (2) action asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or agent of our company to our company or our stockholders, or any claim for aiding and abetting any such alleged breach, (3) action asserting a claim against our company or any director or officer of our company arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or our bylaws, or (4) action asserting a claim against us or any director or officer of our company governed by the internal affairs doctrine except for, as to each of (1) through (4) above, any claim (a) as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (b) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery or (c) arising under the federal securities laws, including the Securities Act, as to which the Court of Chancery and the federal district court for the District of Delaware shall concurrently be the sole and exclusive forums. Notwithstanding the foregoing, the provisions of this paragraph will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America shall be the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any shares of our capital stock shall be deemed to have notice of and to have consented to the forum provisions in our amended and restated certificate of incorporation. If any action the subject matter of which is within the scope the forum provisions is filed in a court other than a court located within the State of Delaware (a “foreign action”) in the name of any stockholder, such stockholder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located within the State of Delaware in connection with any action brought in any such court to enforce the forum provisions (an “enforcement action”), and (y) having service of process made upon such stockholder in any such enforcement action by service upon such stockholder’s counsel in the foreign action as agent for such stockholder.

This forum selection clause may discourage claims or limit stockholders’ ability to submit claims in a judicial forum that they find favorable and may result in additional costs for a stockholder seeking to bring a claim. While we believe the risk of a court declining to enforce this forum selection clause is low, if a court were to determine the forum selection clause to be inapplicable or unenforceable in an action, we may incur additional costs in conjunction with our efforts to resolve the dispute in an alternative jurisdiction, which could have a negative impact on our results of operations and financial condition and result in a diversion of the time and resources of our management and board of directors.

some stockholders.

Item 1B. Unresolved Staff ~~Comments.~~

Comments

None.

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Item 2. ~~Properties.~~

~~We currently maintain~~Properties

Our principal offices are located in Westlake Village, California, Vienna, Virginia, and Lugano, Switzerland. The Westlake Village office serves as our ~~executive offices at 8556 Oakmont Lane, Indianapolis, IN 46260 which~~U.S. headquarters and the Lugano office serves as our international headquarters. The Westlake Village facility consists of approximately 15,767 square feet and is ~~provided to us by Robert J. Laikin, our Chief Executive Officer at no cost. We consider our current office space adequate for our current operations. We consider~~

under a lease that expires in November 2028. The Lugano facility is under a lease that expires in July 2027. The Vienna facility is under a lease that expires in January 2024.

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~~our current office space, combined with the other office space otherwise available to our executive officers, adequate for our current operations.~~

Item 3. Legal ~~Proceedings.~~

~~There is no~~Proceedings

Energy Vault has been and continues to be involved in legal proceedings that arise in the ordinary course of business, the outcome of which, if determined adversely to Energy Vault, would not individually or in the aggregate have a material ~~litigation, arbitration or governmental proceeding currently pending against us or any members~~adverse effect on Energy Vault’s business, financial condition, and results of ~~our management team~~operations. From time to time, Energy Vault may become involved in ~~their capacity as such, and we and~~additional legal proceedings arising in the ~~members~~ordinary course of ~~our management team have not been subject to any such proceeding since our inception.~~

its business.

Item 4. Mine Safety ~~Disclosures.~~

~~None.~~

Disclosures

Not applicable.

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~~PART~~Part II

Item 5. Market for ~~Registrant’s~~Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity ~~Securities.~~

Securities

Market ~~Information.~~

Information for Common Stock

Our ~~units,~~ common stock ~~and warrants are traded~~is listed on the ~~NYSE~~New York Stock Exchange under the ~~symbols “NXU.U”, “NXU”~~ticker symbol “NRGV.” Prior to February 14, 2022 and ~~“NXU.WS”, respectively.~~

~~Holders~~

~~Although there are a larger number~~before the completion of ~~beneficial owners, at January 4, 2022, there were one holder of record of our units, one holder of record of our separately traded~~the Merger, Novus’ Class A common stock 14traded on the New York Stock Exchange under the ticker symbol “NXU.”

Holders of Record

At April 7, 2023, there were 118 holders of ~~record~~record of our ~~Class B~~ common ~~stock and 12 holders of record of our separately traded warrants.~~

~~Dividends~~

stock.

Dividend Policy

We have not paid any cash dividends on our ~~shares of~~ common stock to ~~date and do not intend to pay cash dividends prior to the completion of our initial business combination.~~date. The payment of cash dividends in the future ~~will be~~is dependent upon our revenues and earnings, if any, capital requirements, the terms of any indebtedness, and general financial ~~condition subsequent to completion of our initial business combination.~~condition. The payment of any cash dividends ~~subsequent to our initial business combination~~ will be within the discretion of ~~our board of directors~~the Board at such time. In addition, ~~our board of directors~~the Board is not currently contemplating and does not anticipate declaring any ~~share~~stock dividends in the foreseeable future. Further, if we incur any indebtedness in connection with our initial business combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith.

Securities Authorized for Issuance ~~Under~~under Equity Compensation Plans

~~None.~~

~~Recent~~

For information relating to securities authorized for issuance under equity compensation plans, see Part III, Item 12 of this Form 10-K.

Unregistered Sales of ~~Unregistered Securities;~~Equity Securities and Use of Proceeds ~~from Registered Offerings~~

On ~~February 8, 2021,~~the closing date of the Merger (as defined in “Management’s Discussion and Analysis in Part II, Item 7 of this Annual Report), we consummated a private placement financing (“PIPE”) in which certain investors purchased an aggregate of 19.5 million shares of common stock (such investors, the ~~IPO~~“Subscribers”) for an aggregate purchase price of ~~28,750,000 units, which includes~~$195.0 million. The shares of common stock issued in connection with the full exercise by the underwriter of its over-allotment option in the amount of 3,750,000 units, at $10.00 per unit, generating gross proceeds of $287,500,000. Cowen and Company LLC acted as the underwriter of the IPO. The securities in the offeringPIPE were not registered under the Securities Act, ~~on registration statements on Form S-1 (No. 333-252079). The Securities and Exchange Commission declared the registration statements effective on February 3, 2021.~~

Simultaneous with the consummation of the IPO, and the full exercise of the over-allotment option, we consummated the private placement of an aggregate of 5,166,666 private placement warrants to the initial stockholders at a price of $1.00 per private placement warrant, generating total proceeds of $7,750,000. The issuance was made pursuant toin reliance upon the exemption ~~from registration contained~~provided in Section 4(a)(2) of the Securities Act.

~~The private placement warrants are identical~~ We have used and continue to use the ~~warrants underlying~~proceeds to fund our operations. These shares issued were subsequently registered with the ~~Units sold~~United States Securities and Exchange Commission in ~~the IPO, except that the private placement warrants are not transferable, assignable or salable until 30 days after the completion~~connection with Energy Vault’s Registration Statement on Form S-1 filed on February 14, 2022, which became effective as of ~~a business combination, subject to certain limited exceptions.~~

~~We paid a total~~May 6, 2022.

Repurchase of ~~$5,750,000 in underwriting discounts and commission and $474,714 for other costs and expenses related to the IPO.~~

Of the gross proceeds received from the IPO, including the over-allotment option, and the private placement warrants, $287,500,000 was placed in the trust account and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16)Equity Securities

There were no repurchases of the Investment Company Act, with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the consummation of a business combination or (ii) the distribution of the funds in the Trust Account to the Company’s ~~stockholders. For a description of the use of the proceeds generated in our Initial Public Offering, see Part I, Item 2 of this Form 10-Q.~~

equity securities during 2022.

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Item 6. ~~Selected Financial Data.~~

~~Not required for a smaller reporting company.~~

[Reserved]

Item 7. ~~Management’s~~Management's Discussion and Analysis of Financial Condition and Results of ~~Operations.~~

~~References to the “Company,” Novus,” “our,” “us” or “we” refer to Novus Capital Corporation II.~~ Operations

The following discussion and analysis provide information which Energy Vault’s management believes is relevant to an assessment and understanding of ~~the Company’s financial condition and~~Energy Vault’s consolidated results of operations and financial condition as of December 31, 2022 and for the fiscal year ended December 31, 2022. The discussion and analysis should be read ~~in conjunction~~together with ~~the~~our audited consolidated financial statements and ~~the~~related notes ~~thereto contained~~that are included elsewhere in this ~~report. Certain information contained in the~~Annual report on Form 10-K. This discussion ~~and analysis set forth below includes~~may contain forward-looking statements based upon Energy Vault’s current expectations that involve risks, uncertainties, and ~~uncertainties.~~

~~Special Note Regarding Forward-Looking Statements~~

This Annual Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Form 10KQ including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predicts,” “project,” “shall,” “should,” “would and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors relating to the Merger, please refer to the Risk Factors section of the Registration Statement on Form S-4, as amended, filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s securities filings can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto which are included in “Item 8. Financial Statements and Supplementary Data” of this Annual Report on Form 10-K. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Ourassumptions. Energy Vault’s actual results may differ materially from those anticipated in these forward-looking ~~statements as a result of many factors, including those set forth under “Special~~statements. You should review the section titled “Cautionary Note Regarding Forward-Looking ~~Statements,~~Statements” for a discussion of forward-looking statements and the section titled “Risk Factors,” ~~“Item 1A. Risk Factors”~~for a discussion of factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis and elsewhere in this Annual ~~Report on Form 10-K.~~

~~Overview~~

WeReport. Energy Vault’s historical results are ~~a blank check company formed under the laws~~not necessarily indicative of the ~~State~~results that may be expected for any period in the future. Unless the context otherwise requires, all references in this Annual Report to “we,” “our,” “us,” “the Company,” or “Energy Vault” refer to Energy Vault Holdings, Inc., a Delaware corporation, and its subsidiaries both prior to the consummation of ~~Delaware on September 29, 2020,~~and following the Merger (as defined below).

Our Business

Energy Vault is a grid-scale energy storage company that is driving a faster transition to renewable power by solving the intermittence issues that are inherent to the most prevalent sources of renewable energy, solar and wind.

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Our energy storage and software solutions allow utilities, independent power producers, and large energy users to manage their power portfolios. We provide turnkey energy storage solutions that meet the demands of the market for shorter duration with our BESSs and longer duration with our GESSs. In addition, our hybrid systems that incorporate other energy storage mediums, such as green hydrogen, address demand for extended duration energy storage. Our technology agnostic EMS platform once fully functional will orchestrate the ~~purpose~~management of ~~effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with~~ one or more ~~businesses. We intend~~of our diverse storage mediums and the underlying generation assets to ~~effectuate~~enable the delivery of power to our customers for their varied and multiple use cases.

Our solutions are designed to address the intermittency inherent in the predominant sources of renewable energy production by storing energy produced when renewable energy production is active. Once stored in our storage solutions, energy can be discharged to the grid in a controlled and reliable manner at any time, regardless of the then current ability of the renewable sources to generate power. Our energy storage solutions are designed to accommodate a wide variety of renewable power sources and to achieve an attractive levelized cost of energy relative to fossil fuels. Collectively, these abilities greatly broaden the use cases and time duration scenarios that can be addressed by certain sources of renewable power.

The Company’s portfolio of market-ready turnkey energy storage solutions currently includes:

•Battery energy storage systems (“BESS”) are our integrated solutions to meet shorter-duration storage needs.

•Gravity energy storage systems (“GESS”) include our proprietary EVx solution to meet longer-duration storage needs.

•Green hydrogen energy storage systems (“gHESS”) are our integrated solutions to meet extended duration storage needs.

•Hybrid energy storage systems (“HESS”) are our uniquely integrated solutions which allow the pairing of various energy storage mediums to meet specific customer needs.

•Energy management software platform (“EMS”) is our proprietary solution designed by our Energy Vault Solutions (“EVS”) division that orchestrates the management of one or more of our diverse storage mediums, along with the underlying generation assets to enable the delivery of power to our customers for their varied and multiple use cases.

Recent Developments

In January 2022, Energy Vault signed a license and royalty agreement for renewable energy storage with Atlas Renewable LLC (“Atlas”), which is majority owned by China Tianying Inc., an international environmental management and waste remediation corporation engaged in smart urban environmental services, resource recycling and recovery, and zero-carbon clean energy technologies. The agreement supports the deployment of Energy Vault’s proprietary gravity energy storage technology and energy management software platform within mainland China and the Special Administrative Regions of Hong Kong and Macau. Atlas agreed to pay $50.0 million in IP licensing fees, for use and deployment of Energy Vault’s gravity energy storage technology. The Company has collected all $50.0 million as of December 31, 2022.

In connection with the Company’s licensing agreement with Atlas, the Company agreed to make a refundable contribution to Atlas in the amount up to $25.0 million during the period in which Atlas constructs its first GESS. As of December 31, 2022, the Company has contributed all $25.0 million. The refundable contribution will be returned to the Company upon Atlas’ first GESS reaching substantial completion, subject to adjustment for potential liquidated damages if certain performance metrics are not met.

In April 2022, the Company purchased a $2.0 million convertible promissory note from DG Fuels, LLC (“DG Fuels”). The maturity date of the note is the earlier of (i) 30 days after a demand for payment is made by the Company at any time after the two year anniversary of the date of issuance of the note; (ii) the four year anniversary of the date of issuance of the note; (iii) five days following a Financial Close (“Financial Close” means a project finance style closing by DG Fuels or its subsidiary of debt and equity capital to finance the construction of that certain biofuel facility currently under development by DG Fuels), or (iv) upon an event of default determined at the discretion of the Company. The note has an annual interest rate of 10.0%. The Company intends to hold and convert the DG Fuels Note into the equity securities issued by DG Fuels in their next equity financing round that is greater than $20.0 million at a 20% discount to the issuance price. The principal balance and unpaid accrued interest on the DG Fuels Note will, at the option of the Company, convert into equity securities upon the closing of such next equity financing round.

On July 1, 2022, Energy Vault delivered a notice of redemption for all of its outstanding public warrants to purchase shares of Energy Vault common stock. After delivering the notice of redemption, 2.2 million shares of common stock were issued upon the cashless exercise of 8.7 million public warrants. 0.2 million in unexercised and outstanding Public Warrants as of

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August 1, 2022 were redeemed at a price of $0.10 per warrant. No Public Warrants remain outstanding as of December 31, 2022.

In August 2022, the Company entered into two contracts with Jupiter Power (“Jupiter”), a leading battery energy storage developer and owner/operator of utility-scale battery energy storage projects in the United States, whereby Energy Vault will supply equipment, engineering, procurement, construction, balance of plant services, and the energy management software for two of Jupiter’s battery energy storage projects. The projects include a 100 MW (200 MWh) BESS near Fort Stockton, Texas, which will provide energy and ancillary services to ERCOT, and a 10 MW (20 MWh) system in Carpinteria, California, to provide grid services through participation in the CAISO Resource Adequacy program as well as energy resiliency in southern California. The projects will provide critically needed dispatchable capacity to these electricity markets and are expected to be completed in 2023.

In September 2022, the Company entered into a contract with Wellhead Electric Company, Inc. and W Power, LLC, (“W Power”), a woman-owned business ~~combination~~enterprise that has developed and owned power generation facilities in California, whereby Energy Vault will construct a 68.8 MW (275.2 MWh) BESS at W Power’s Energy Reliability Center in Stanton, California. The project is on an accelerated timeline to meet critical power needs for southern California and is expected to be completed by mid-2023.

In November and December 2022, the Company entered into license and royalty agreements with two customers in the Middle East and Europe, respectively, to deploy Energy Vault’s proprietary gravity energy storage technology and energy management software platform.

In December 2022, the Company entered into a contract with NV Energy, whereby Energy Vault will construct a 220 MW (440 MWh) grid-tied BESS at a site located near Las Vegas, Nevada. The two-hour energy storage system is designed to store and dispatch excess renewable energy, including wind and solar power. The BESS will be charged and discharged on a daily basis and designed to dispatch stored renewable energy at peak consumption hours to help meet the high demand during Nevada’s peak load hours. Construction is anticipated to begin during the second quarter of 2023 with commercial operation expected by the end of 2023.

In December 2022, the Company entered into a tolling arrangement with Pacific Gas and Electric Company (“PG&E”), a subsidiary of PG&E Corporation (NYSE: PCG), in which Energy Vault and PG&E are partnering to deploy and operate a utility-scale battery plus green hydrogen long-duration energy storage system (“BH-ESS”) with a minimum of 293 MWh of dispatchable carbon-free energy, with the potential to further expand the project’s capacity up to 700 MWh. The BH-ESS is designed to power downtown and the surrounding area of the Northern California city of Calistoga for a minimum of 48 hours during planned outages and potential public safety power shutoffs, which is when the power lines serving the surrounding area must be turned off for safety due to high wildfire risk. The energy storage system will be owned, operated, and maintained by Energy Vault while providing dispatchable power under a long-term tolling arrangement with PG&E. Construction is anticipated to begin during the fourth quarter of 2023 with commercial operation expected by the end of the second quarter of 2024.

Business Combination and Public Company Costs

On February 11, 2022, Legacy Energy Vault completed the Merger. Immediately following the completion of the Merger, Novus changed its name to Energy Vault Holdings, Inc. On February 14, 2022, Energy Vault’s common stock and warrants began trading on the New York Stock Exchange under the symbols “NRGV” and “NRGV WS,” respectively.

The Merger was accounted for as a reverse recapitalization in accordance with United States Generally Accepted Accounting Principles (“GAAP”). Under this method of accounting, Novus was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the financial statements of the combined entity upon consumption of the Merger represented a continuation of the financial statements of Legacy Energy Vault with the Merger being treated as the equivalent of Legacy Energy Vault issuing stock for the net assets of Novus, accompanied by a recapitalization. The net assets of Novus are stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Merger are presented as those of Legacy Energy Vault in future reports of the combined entity. All periods prior to the Merger have been retroactively adjusted using ~~cash from~~ the exchange ratio of 6.7735 (the “Exchange Ratio”) for the equivalent number of shares outstanding immediately after the Merger to effect the reverse recapitalization.

Energy Vault raised gross proceeds of ~~our~~$235.9 million, including the contribution of $40.9 million of cash, net of redemptions, held in Novus’ trust account from its initial public offering and an aggregate purchase price of $195.0 million from the sale and issuance of shares of common stock in a private placement (“Private Investment in Public Equity” or “PIPE”) at $10.00 per share. Energy Vault and Novus paid $44.8 million in transaction costs, resulting in total net cash proceeds to Energy Vault from the Merger and PIPE of $191.1 million. See Note 1 and Note 3, in Part II, Item 8. “Financial Statements and Supplementary Data” for additional information about the Merger.

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As a result of the ~~private warrants, our capital stock, debt or~~Merger, Energy Vault became the successor to a ~~combination~~publicly reporting company, which has required the hiring of ~~cash, stock~~additional personnel and ~~debt.~~

the implementation of procedures and processes to comply with public company regulatory requirements, including the Exchange Act, and customary practices. We have incurred and expect to continue to incur additional annual expenses as a public company for, among other things, directors’ and officers’ liability insurance, director fees, and additional internal and external accounting, legal, and administrative resources, including increased audit and legal fees.

Key Factors and Trends Affecting our Business

We believe that our performance and future success depend upon several factors that present significant ~~costs~~opportunities for us, but also pose risks and challenges including those discussed below and in Part I, Item 1A. “Risk Factors.”

Product Development and Deployment Plan

We leverage our sustainable and differentiated technology to provide our customers with an economical solution to meet their shorter, longer, and extended-duration renewable energy storage needs. We believe that the majority of our competitors are primarily focused on the development and marketing of vertically siloed solutions based on a singular energy storage technology. We anticipate that our market will be characterized by high growth and rapidly evolving use cases and requirements. As a result, we have strategically chosen to design an agile and agnostic software platform that can orchestrate the management of one or more of our diverse storage mediums and the underlying power generation assets to harmonize asset operation and maximize economic return for our customers. This full spectrum of energy storage solutions assures our customers that we not only have what they need today, but that we also have what they will need in the ~~pursuit~~future, thereby protecting their investments in our products. For these reasons, we believe we are well positioned to compete successfully in the evolving market for energy storage solutions.

Our project delivery generally relies on third-party EPC firms to construct our storage systems, under our supervision with dedicated teams tasked with project management. Our current business model options include:

•Building, operating, and transferring energy storage projects to potential customers,

•Building, operating, and holding energy storage systems as equity (co-) sponsor that may provide recurring revenue in the future,

•Recurring software revenue through licensing software for asset management and use case applications,

•Recurring service revenue through long term service agreements, and

•Intellectual property licenses and royalties associated with our energy storage technologies that may provide recurring revenues in the future.

Our cost projections are heavily dependent upon raw materials (such as steel), equipment (such as motors, batteries, inverters, and power electronic devices) and technical and construction service providers (such as engineering, procurement, construction firms). The global supply chain, on which Energy Vault relies, has been significantly impacted by (i) the COVID-19 pandemic, (ii) economic uncertainties, including the war in Ukraine, and (iii) high inflation pressure on project budgeting resulting in potential significant delays and cost fluctuations, particularly with respect to microchips and many other raw materials that are within the motor and power electronic supply chains. These future timing and financial developments may impact Energy Vault’s performance from both a deployment and cost perspective.

To date, the only operating energy storage system that utilized Energy Vault’s technologies was the CDU. Energy Vault used the CDU for testing and software improvements until it was decommissioned in September 2022. Building on its experience with the CDU, Energy Vault designed its EVx system. The EVx system is designed to be modular and flexible to address longer duration energy storage needs, such as when there are power outages or for powering industrial processes over long periods. There are no commercial installations of Energy Vault’s EVx system at this time.

Energy Storage Industry

The growth of the energy storage market that we address is primarily driven by the decreasing cost of renewable power generation sources, government mandates, financial incentives to reduce CO2 emissions, and increasing geopolitical pressures driving energy independence goals. These dynamics are in turn driving demand for additional renewable power generation and increased capacity and storage duration in energy storage solutions.

According to a BloombergNEF analysis published in October 2022, demand for clean energy is growing rapidly, with renewable energy expected to supply nearly two-thirds of the world's electricity demand by 2050. Global energy storage additions are on track to grow at a 21% compound annual growth rate through 2030, with annual additions reaching 233 GWhs and cumulative capacity reaching nearly 400 GWhs. Both government mandates and companies focused on

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reducing energy use, cost, and emissions will propel the shift to renewable sources of power. We believe we are well-positioned to capitalize on this opportunity through our competitive pricing and scalability, and the environmentally friendly attributes of our ~~acquisition plans. We cannot assure you~~energy storage solutions that cover the spectrum from shorter durations to extended durations.

During 2022, the United States Congress passed the IRA. The IRA provides incentives for the domestic manufacturing of key components of energy storage solutions as well as the construction of standalone energy storage projects. The resulting improved economics are expected to reduce the cost to implement storage within the domestic market and may amplify and accelerate the adoption of energy storage systems for shorter, longer, and extended duration use cases, like those offered by Energy Vault.

Our business depends on the acceptance of our ~~plans~~energy storage products in the marketplace. Even if renewable energy and energy storage become more widely adopted than they have been to ~~complete~~date, potential customers may choose energy storage products from our competitors.

Increasing Deployment of Renewable Energy

Deployment of renewable energy resources has accelerated over the last decade, and solar and wind have become a ~~business combination~~low cost energy source. Energy storage is critical to reducing the intermittency and volatility of renewable energy generation. However, there is no guarantee that the deployment of renewable energy will occur at the rate that is expected. Inflationary pressures, supply chain disruptions, geopolitical stresses, and other factors could result in fluctuations in demand for and deployment of renewable energy resources, adversely affecting our revenue and ability to generate profits in the future.

Competition

The market for our products is competitive, and we may face increased competition as new and existing competitors introduce energy storage solutions and components. Furthermore, as we expand our services and digital applications in the future, we may face other competitors including software providers and hardware manufacturers that offer software solutions. If our market share declines due to increased competition or if we are not able to compete as we expect, our revenue and ability to generate profits in the future may be ~~successful.~~

adversely affected.

Inflation

In the markets in which we operate, there have been higher rates of inflation in recent months. If inflation continues to increase in our markets, it may increase our expenses that we may not be able to pass through to customers. It may also increase the costs of our products that could negatively impact their competitiveness.

Key Components of Results of Operations

~~We have neither engaged~~

The following discussion describes certain line items in ~~any operations nor generated any operating revenues~~our Consolidated Statements of Operations and Comprehensive Loss.

Revenue

Prior to ~~date. Our only activities~~2022, the Company was primarily involved in research and development activities. The Company began generating revenue from ~~inception through December 31, 2021 were organizational activities~~its product offerings during 2022, primarily from the licensing of our GESS EVx solution and ~~those necessary to prepare for~~from the ~~IPO, described below, and~~sale of our ~~search for a target business for a business combination.~~BESSs. We ~~do not~~ expect to generate ~~any operating revenues until after~~revenue in the ~~completion~~future from the sale and licensing of the Company’s energy storage solutions, EMS, additional software applications, and long-term services agreements, including pursuant to tolling arrangements in connection with energy storage systems that we intend to own and operate.

Our revenue is affected by changes in the price, volume, and mix of products and services purchased by our customers, which is driven by the demand of our ~~initial business combination. We generate non-operating income~~products, geographic mix of our customers, strength of competitor’s product offerings, and the availability of government incentives to the end-users of our products.

Our revenue growth is dependent on continued growth in the ~~form~~amount of ~~interest income~~energy storage systems constructed each year and our ability to increase our share of demand in the geographic regions where we currently compete and plan to compete in the future. Additionally, our revenue growth is dependent on ~~marketable securities held after~~our ability to continue to develop and commercialize new and innovative products to meet our customer’s energy storage needs.

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Cost of Revenue

Cost of revenue primarily consists of product costs, including batteries and supplies, as well as subcontractor costs, direct labor, and consulting expenses associated with constructing energy storage systems and providing construction support services to Atlas.

Our cost of revenue is affected by underlying costs for batteries, inverters, enclosures, and cables, as well as the ~~IPO.~~cost of subcontractors to provide construction services.

Gross Profit and Gross Profit Margin

Gross profit and gross profit margin may vary from period to period due to the timing of when control of significant uninstalled materials are transferred to customers under contracts to sell energy storage systems. When control of significant uninstalled materials are transferred to customers, the Company recognizes revenue in an amount equal to the cost of those materials. The profit margin inherit in these materials is deferred until the Company performs on its obligation to install the materials during construction of the energy storage systems. As a result, gross profit and gross profit margin will vary from period to period depending on the timing of revenue recognition related to uninstalled materials.

Additionally, gross profit and gross profit margin may vary from period to period due to our sales volume, product prices, product costs, product mix, geographical mix, and the timing of when we perform installation and construction services.

Sales and Marketing Expenses

Sales and marketing expenses consist primarily of internal personnel-related costs for marketing, sales, and related support teams and external costs such as professional service costs, trade shows, marketing and sales related promotional materials, public relations expenses, website operating and maintenance costs. Personnel-related expenses consist of salaries, benefits, and stock-based compensation expense. We expect that our sales and marketing expenses will increase over time as we ~~will incur increased~~continue to hire additional personnel to support the overall growth in our business.

Research and Development Expenses

Research and development expenses consist primarily of internal and external expenses incurred in connection with our research activities and development programs that include materials costs directly related to product development, testing and evaluation costs, construction costs including labor and transportation of material, overhead related costs and other direct expenses consisting of personnel-related expenses and consulting expenses relating to study of product safety, reliability and development. Personnel-related expenses consist of salaries, benefits, and stock-based compensation expense. We expect our research and development costs to increase for the foreseeable future as we continue to invest in these activities to achieve our product design, engineering, and development roadmap.

General and Administrative Expenses

General and administrative expenses consist of information technology expenses, legal and professional fees, travel costs, and personnel-related expenses for our corporate, executive, finance, and other administrative functions, including expenses for professional and contract services. Personnel-related expenses consist of salaries, benefits, and stock-based compensation expense. To a lesser extent, general and administrative expense includes depreciation, investor relations costs, insurance costs, rent, office expenses, and maintenance costs. We expect our general and administrative expenses to increase in the foreseeable future as we hire personnel to meet the growth of our business, and as a result of ~~being~~operating as a public company, ~~(for~~including compliance with the rules and regulations of the SEC, legal, ~~financial~~audit, additional insurance requirements, investor relations fees, SOX 404 implementation fees, and other administrative and professional services.

Asset Impairment

Energy Vault began building a prototype of the EV1 in March 2020, resulting in the CDU, which was connected to the Swiss national grid in July 2020. Thereafter, through design improvements and refinements of its technology, Energy Vault announced the new EVx platform in 2021 and the Company dismantled the CDU in September 2022. The Company has recognized various impairments related to the CDU when components have been damaged or become obsolete.

Interest Expense

Interest expense consists primarily of interest related to finance leases.

Change in Fair Value of Warrant Liability

The Company’s warrants are subject to fair value remeasurement at each balance sheet date. The Company expects to incur incremental income (expense) in the consolidated statements of operations for the fair value change for the outstanding warrant liabilities at the end of each reporting period or through the exercise of such warrants. With the completion of the redemption of Energy Vault’s public warrants on August 1, 2022, Energy Vault currently expects to incur incremental

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income (expense) in its consolidated statements of operations for the fair value change for outstanding warrant liabilities at the end of each reporting period in respect of outstanding private warrants.

Transaction Costs

Transaction costs consist of legal, accounting, banking fees, and ~~auditing compliance)~~other costs directly related to the consummation of the Merger and the PIPE.

Other Income (Expense), Net

Other income (expense), net consists primarily of interest income from our money market funds, as well as gains and losses related to foreign exchange transactions.

Key Operating Metrics

Bookings

Bookings represents the total MWhs to be delivered and the aggregate contracted value for energy storage systems, tolling arrangements, and license and service agreements signed during the period. The aggregate contracted value excludes any potential future variable payments or royalties.

The following table presents bookings for the periods indicated ($ in thousands):


	Year Ended December 31,
	2022		2021		Change
Bookings [MWh]	1,635		—		1,635
Bookings [$]	$	540,086	$	—	$	540,086

Backlog

Backlog represents the amount of revenue we expect to realize in the future on uncompleted construction contracts, including new contracts under which work has not yet begun, as well as the remaining revenue to be recognized under the Company’s intellectual property licensing agreements. As of December 31, 2022, backlog totaled $331.0 million.

The Company expects to realize the majority of the backlog as of December 31, 2022 over the next twelve months. Timing of revenue for construction and installation projects included in our backlog can be subject to change as a result of customer, regulatory, or other delays or cancellations including from economic or other conditions caused by supply chain disruptions, inflation, weather, and/or other project-related factors. These effects, among others, could cause estimated revenue to be realized in periods later than originally expected, or not at all. Customers may postpone or cancel construction projects due ~~diligence expenses~~to changes in ~~connection~~our customer’s spending plans, market volatility, changes in government permitting, regulatory delays, and/or other factors. There can be no assurance as to our customer’s requirements or if actual results will be consistent with ~~searching~~our estimates. As a result, our backlog as of any particular date is an uncertain indicator of future revenue and earnings.

Backlog is a common measurement used in our industry. Our methodology for ~~and completing, a Business Combination.~~

determining backlog may not, however, be comparable to the methodologies used by others. The Company’s backlog agrees with the amount of our remaining performance obligations, which are described in Note 4 - Revenue Recognition.

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~~For~~Results of Operations

Consolidated Comparison of Year Ended December 31, 2022 to Year Ended December 31, 2021

The following table sets forth our results of operations for the periods indicated (amounts in thousands):


	Year Ended December 31,
	2022		2021		$ Change
Revenue	$	145,877	$	—	$	145,877
Operating Expenses:
Cost of revenue	86,580		—		86,580
Sales and marketing	12,582		845		11,737
Research and development	50,058		7,912		42,146
General and administrative	56,912		18,056		38,856
Asset impairment	2,828		2,724		104
Loss from operations	(63,083)		(29,537)		(33,546)
Other Income (Expense):

Interest expense	(2)		(7)		5
Change in fair value of warrant liability	2,330		—		2,330
Transaction costs	(20,586)		—		(20,586)
Other income (expenses), net	3,469		(1,793)		5,262
Loss before income taxes	$	(77,872)	$	(31,337)	$	(46,535)

Revenue

The Company recognized revenue for the product and service categories as follows for the years ended December 31, 2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
Build and transfer energy storage products	$	85,636	$	—
Licensing of intellectual property	58,483		—
Other	1,758		—
Total revenue	$	145,877	$	—

Revenue for the year ended December 31, 2022 was $145.9 million compared to no revenue for the year ended December 31, 2021. Revenue for the year ended December 31, 2022 consisted of $85.6 million from the building and transferring of energy storage products and $58.5 million from the licensing of the Company’s EVx intellectual property. Additionally, the Company recognized other revenue of $1.8 million related the Company providing construction support services to Atlas during the year ended December 31, 2022. Revenue from two customers represented 57% and 35%, respectively, of the Company’s total revenue for the year ended December 31, 2022.

Cost of Revenue

Cost of revenue was $86.6 million for the year ended December 31, 2022 compared to no cost of revenue for the year ended December 31, 2021. Cost of revenue for the year ended December 31, 2022 was primarily attributable to the cost of batteries related to the build and transfer of its battery storage projects. Cost of revenue also included subcontractor costs on its battery storage projects, and direct labor and consulting expenses related to providing construction support services to Atlas.

Gross Profit and Gross Profit Margin

Gross profit was $59.3 million and gross profit margin was 40.6% for the year ended December 31, 2022. Gross profit in 2022 was primarily attributable to the Company’s intellectual property licensing revenue, which did not have any associated cost of revenue.

Sales and Marketing Expenses

Sales and marketing expenses increased by $11.8 million to $12.6 million for the year ended December 31, 2022, compared to $0.8 million for the year ended December 31, 2021. The increase was primarily attributable to an increase in

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personnel-related expenses of $8.9 million, an increase in marketing and public relations costs of $1.5 million, an increase in consulting costs of $0.6 million, and an increase in travel related expenses of $0.6 million. The increase in personnel costs was due to expanded headcount, particularly at the senior levels, and increased stock-based compensation expense. Stock-based compensation expense was $5.1 million for the year ended December 31, 2022, compared to $0.1 million for the year ended December 31, 2021.

Research and Development Expenses

Research and development expenses increased by $42.2 million to $50.1 million for the year ended December 31, 2022, compared to $7.9 million for the year ended December 31, 2021. The increase was primarily attributable to a $22.3 million increase in personnel-related expenses, a $7.5 million increase in depreciation expense, a $7.0 million increase in engineering and development costs, a $3.1 million increase in software expenses, a $1.2 million increase in consulting costs, and a $1.0 million increase in travel related expenses. The increase in personnel costs was due to expanded headcount, particularly at the senior levels, and increased stock-based compensation expense. Stock-based compensation expense was $14.8 million for the year ended December 31, 2022, compared to $0.4 million for the year ended December 31, 2021. The increase in depreciation expense primarily relates to depreciation on the CDU and related components.

General and Administrative Expenses

General and administrative expenses increased by $38.8 million to $56.9 million for the year ended December 31, 2022, compared to $18.1 million for the year ended December 31, 2021. The increase was primarily attributable to a $25.7 million increase in personnel-related expenses, a $6.3 million increase in legal and professional fees, a $2.5 million increase in consulting costs, a $1.8 million in travel related expenses, a $1.7 million increase in insurance costs, a $1.1 million increase in software expenses, and a $0.8 million increase in employee recruiting costs. The increase in personnel costs was due to expanded headcount and an increase in stock-based compensation expense. Stock-based compensation expense was $21.2 million for the year ended December 31, 2022, compared to $0.1 million for the year ended December 31, 2021. The increase in legal and professional fees was attributable to external costs such as accounting, finance, tax, compliance, auditing, legal, and other professional fees associated with becoming a public company. These increases in general administrative expenses were partially offset by a $1.2 million decrease in depreciation expense.

Asset Impairment

Asset impairment was $2.8 million for the year ended December 31, 2022, compared $2.7 million for the year ended December 31, 2021. Asset impairment for the year ended December 31, 2022 related to the CDU and the brick machines used to manufacture bricks for the EV1 tower design. The Company completed the dismantling of the CDU during 2022.

Asset impairment of $2.7 million for the year ended December 31, 2021 related to components of the CDU that were damaged. This impairment and other related costs were partially offset by an insurance claim received by the Company. Additionally, other components, which were not previously installed, were reclassified into prepaid expenses and other current asset at their estimated net realizable value during 2021.

Change in Fair Value of Warrant Liability

The Company recognized a gain of $2.3 million related to the change in the fair value of the Company’s warrant liability for the year ended December 31, 2022 due to a decrease in the fair value of our outstanding warrants since the Closing of the Merger. The Company did not have any outstanding warrants during the year ended December 31, 2021.

Transaction Costs

The Company recognized transaction costsof $20.6 million related to the consummation of the Merger during theyear ended December 31, 2022. The Company did not recognize any transaction costs during 2021.

Other Income (Expense), Net

Other income (expense), net improved by $5.3 million to other income, net of $3.5 million for the year ended December 31, 2022 compared to other expense, net of $1.8 million for the year ended December 31, 2021. The improvement was primarily attributable to an increase in interest income and positive fluctuations in foreign currency transaction gain and losses.

Liquidity and Capital Resources

Sources of Liquidity

Since inception, we have financed our operations primarily through the issuance and sale of equity and the proceeds from the Merger and the PIPE. Energy Vault completed the Merger and PIPE on February 11, 2022, pursuant to which we

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received net proceeds of $191.1 million. As of December 31, 2022, we had cash, cash equivalents, and restricted cash of $286.2 million. Our cash equivalents are highly liquid investments purchased with an original or remaining maturities of three months or less. Substantially all of our restricted cash balance is held by banks as collateral for the Company’s letters of credit.


	December 31,
(amounts in thousands)	2022		2021
Cash, cash equivalents, and restricted cash:
Cash and cash equivalents	$	203,037	$	105,125
Restricted cash	83,145		—
Total cash, cash equivalents, and restricted cash	$	286,182	$	105,125

Short-Term Liquidity

Management believes that its cash, cash equivalents, and restricted cash on hand as of December 31, 2022 will be sufficient to fund our operating activities for at least the next twelve months without regard to any cash proceeds we received or may in the future receive upon the exercise for cash of our private warrants. The exercise price for our private warrants is $11.50 per warrant, subject to certain specified adjustments. To the extent that the price of our common stock exceeds $11.50 per share, it is more likely that our private warrant holders will exercise their warrants. To the extent that the price of our common stock declines, including a decline below $11.50 per share, it is less likely that our private warrant holders will exercise their warrants.

In addition, should Energy Vault enter into definitive collaboration and/or joint venture agreements or engage in business combinations in the future, we may be required to seek additional financing.

Energy Vault has incurred negative operating cash flows and operating losses in the past. We may continue to incur operating losses in the future due to our-going research and development activities. We may seek additional capital through equity and/or debt financings depending on market conditions. If we are required to raise additional funds by issuing equity securities, dilution to stockholders would result. Any equity securities issued may also provide for rights, preferences or privileges senior to those of holders of our common stock. If we raise funds by issuing debt securities, these debt securities would have rights, preferences and privileges senior to those of holders of common stock. The terms of debt securities or borrowings could impose significant restrictions on our operations. The credit market and financial services industry have in the past, and may in the future, experience periods of uncertainty that could impact the availability and cost of equity and debt financing.

Licensing Agreements with Extended Payment Terms

The Company has licensed its EVx intellectual property and certain of these agreements contain extended payment terms. Expected cash inflows from all licensing agreements with extended payment terms as of December 31, 2022 are as follows:


Year ended December 31,	Amount
2023	$	1,600
2024	1,500
2025	5,250
2026	2,750
2027	2,750
Thereafter	13,750
Total	$	27,600

Contractual Obligations

Our principal commitments as of December 31, 2022 consisted primarily of obligations under operating leases, finance leases, deferred pensions, and issued purchase orders. Our non-cancellable purchase obligations as of December 31, 2022 totaled approximately $50.2 million.

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Cash Flows

The following table summarizes cash flows from operating, investing, and financing activities for the periods indicated (amounts in thousands):


	Year Ended December 31,
	2022		2021
Net cash used in operating activities	$	(23,346)	$	(22,066)
Net cash used in investing activities	(13,319)		(1,170)
Net cash provided by financing activities	217,771		116,379
Effects of exchange rate changes on cash	(49)		1,931
Net increase in cash, cash equivalents, and restricted cash	$	181,057	$	95,074

Operating Activities

During the years ended December 31, 2022 and 2021, cash used in operating activities totaled $23.3 million and $22.1 million, respectively. During the year ended December 31, 2022, cash used in operating activities was negatively impacted by a net loss of ~~$3,338,538, which~~$78.3 million, an increase in accounts receivable of $37.5 million, an increase in contract assets of $29.0 million, an increase in prepaid and other current assets of $29.6 million, an increase in customer financings receivable of $9.7 million, and an increase in inventory of $4.4 million. Operating cash flows were positively impacted by non-cash charges of $49.6 million, an increase in accounts payable and accrued expenses of $67.9 million, and an increase in contract liabilities of $49.4 million. The non-cash charges primarily consisted of ~~formation~~$41.1 million in stock-based compensation expense, $7.7 million in depreciation and ~~operational costs of $1,247,217,~~amortization expense, and $2.8 million in asset impairments, partially offset by a $2.3 million gain from the change in fair value of the Company’s warrant ~~liability of $1,865,833 and transaction costs incurred in connection with warrant liability of $241,311, offset by the interest earned on marketable securities held in Trust account of $15,823.~~

~~For the period from September 29, 2020 (inception) through December 31, 2020, we had net loss of $1,104, which consisted of operating costs.~~

~~Liquidity and Capital Resources~~

On February 8, 2021, we consummated the IPO of 287,500,000 Units, at a price of $10.00 per Unit, which included the full exercise by the underwriters of their over-allotment option in the amount of 3,750,000 Units, generating gross proceeds of $287,500,000. Simultaneously with the closing of the IPO, we consummated the sale of 5,166,666 private placement warrants to the Sponsor at a price of $1.50 per private placement warrant generating gross proceeds of $7,750,000.

Following the IPO, the full exercise of the over-allotment option, and the sale of the private placement warrants, $287,500,000 was placed in the trust account, and we had $1,281,731 of cash held outside of the Trust Account, after payment of costs related to the IPO, and available for working capital purposes. We incurred $6,224,714 in transaction costs, including $5,750,000 of underwriting fees, $474,714 of other offering costs.

~~For~~liability.

During the year ended December 31, 2021, cash used in operating activities of $22.1 millionwas ~~$1,153,887. Net~~negatively impacted by a net loss of ~~$3,338,538 was affected~~$31.3 million. Operating cash flows were positively impacted by ~~interest earned on marketable securities held~~non-cash charges of $6.3 million and an increase in accounts payable and accrued expenses of $3.0 million. Non-cash charges primarily consisted of $3.2 million related to the ~~trust account~~write-down of ~~$15,823~~inventory, $2.3 million in depreciation and ~~offset by~~amortization expense, $0.5 million in stock-based compensation expense, and $0.1 million in non-cash lease expenses.

Investing Activities

During the change in fair value of warrant liability of $1,865,833 and transaction costs incurred in connection with warrant of $241,311. Changes in operating assets and liabilities which provided $93,330 of cash for operating activities.

~~For the period from September 29, 2020 (inception) through~~years ended December 31, ~~2020, there was $104~~2022 and 2021, cash used in ~~operating activities. Net loss~~investing activities totaled $13.3 million and $1.2 million, respectively. Cash used in investing activities for the year ended December 31, 2022 consisted of ~~$1,104 was affected by changes~~$9.0 million for the purchase of equity securities, $2.3 million for the purchase of property and equipment, and $2.0 million for the purchase of a convertible note. The Company purchased $9.0 million of equity securities as part of a strategic investment in ~~operating assets and liabilities provided $1,000.~~

~~As of~~ a company that is active in the energy transition industry.

Cash used in investing activities for the year endedDecember 31, 2021 ~~we had~~consisted of $1.0 million for the purchase of a convertible note and $0.2 million for the purchase of property and equipment.

Financing Activities

During the years ended December 31, 2022 and 2021, cash provided by financing activities totaled $217.8 millionand ~~marketable securities held~~$116.4 million, respectively. For the year ended December 31, 2022, cash provided by financing activities was primarily attributable to $235.9 million in proceeds from the reverse recapitalization and PIPE financing, net, and $7.9 million in proceeds from the exercise of warrants. Partially offsetting these cash inflows was $20.7 million in transaction cost payments related to the reverse recapitalization and $5.5 million in tax payments related to the net settlement of equity awards.

During the year ended December 31, 2021, cash provided by financing activities was primarily attributable to $105.4 million in net proceeds from the issuance of Series C preferred stock and $15.3 million in net proceeds from the issuance of Series B-1 preferred stock. Partially offsetting these cash inflows was $3.6 million in payments related to Merger transaction costs and $0.8 million in debt repayments.

Non-GAAP Financial Measure

We use adjusted EBITDA to complement our consolidated statements of operations. Management believes that this non-GAAP financial measure complements our GAAP net loss and such measure is useful to investors. The presentation of this non-GAAP measure is not meant to be considered in isolation or as an alternative to GAAP net loss as an indicator of our performance.

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The following table provides a reconciliation from non-GAAP adjusted EBITDA to GAAP net loss, the most directly comparable GAAP measure (amounts in thousands):


	Year Ended December 31,
	2022		2021
Net loss (GAAP)	$	(78,299)	$	(31,338)
Non-GAAP Adjustments:
Interest income, net	(3,693)		(57)
Income tax expense	427		1
Depreciation and amortization	7,743		2,320
Stock-based compensation expense	41,058		500
Change in fair value of warrant liability	(2,330)		—
Transaction costs	20,586		—
Asset impairment	2,828		2,724
Foreign exchange losses	316		1,878
Adjusted EBITDA (non-GAAP)	$	(11,364)	$	(23,972)

We present adjusted EBITDA, which is net loss excluding adjustments that are outlined in the ~~trust account~~quantitative reconciliation provided above, as a supplemental measure of ~~$287,515,823. We intend~~our performance and because we believe this measure is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. The items excluded from adjusted EBITDA are excluded in order to better reflect our continuing operations.

In evaluating adjusted EBITDA, one should be aware that in the future we may incur expenses similar to the adjustments noted above. Our presentation of adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these types of adjustments. Adjusted EBITDA is not a measurement of our financial performance under GAAP and should not be considered as an alternative to net loss, operating loss, or any other performance measures derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity.

Our adjusted EBITDA measure has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

•it does not reflect our cash expenditures, future requirements for capital expenditures, or contractual commitments;

•it does not reflect changes in, or cash requirements for, our working capital needs;

•it does not reflect stock-based compensation, which is an ongoing expense;

•although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and our adjusted EBITDA measure does not reflect any cash requirements for such replacements;

•it is not adjusted for all non-cash income or expense items that are reflected in our consolidated statements of cash flows;

•it does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations;

•it does not reflect limitations on or costs related to transferring earnings from our subsidiaries to us; and

•other companies in our industry may calculate this measure differently than we do, limiting its usefulness as a comparative measure.

Because of these limitations, adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to use ~~substantially~~to meet our obligations. You should compensate for these limitations by relying primarily on our GAAP results and using adjusted EBITDA only supplementally.

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Off-Balance Sheet Commitments and Arrangements

The Company has not entered into off-balance sheet arrangements, as defined in the rules and regulations of the SEC as of December 31, 2022.

Critical Accounting Policies and Use of Estimates

Our consolidated financial statements are prepared in conformity with GAAP. In preparing our financial statements, we make assumptions, judgments, and estimates based on historical experience and various other factors that we believe to be reasonable under the circumstances. Actual results could differ materially from these estimates under different assumptions and conditions.

We believe that the following accounting policies involve a high degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations. For more information on our significant accounting policies, refer to Note 2 - Summary of Significant Accounting Policies of our audited consolidated financial statements included in this Annual Report on Form 10-K.

Revenue

Effective January 1, 2022, Energy Vault’s revenue recognition policy is a critical policy due to the adoption of the guidance from ASC 606, Revenue from Contracts with Customers. We determine the amount of revenue to be recognized through the application of the following steps:

(1)Identification of the contract, or contracts, with a customer.

(2)Identification of the performance obligations in the contract.

(3)Determination of the transaction price.

(4)Allocation of the transaction price to the performance obligations in the contract.

(5)Recognition of revenue when, or as, a performance obligation is satisfied.

The Company identifies performance obligations in our contracts with customers. The transaction price is determined based on the amount which the Company expects to be entitled to in exchange for providing the promised goods and services to the customer. The transaction price in the contract is allocated to each distinct performance obligation on a relative standalone selling price basis. Revenue is recognized when performance obligations are satisfied. When a part or all of the ~~funds held~~consideration is considered to be variable, an estimate of the unconstrained amount is recognized in the ~~trust account, including any amounts representing interest earned~~transaction price. Changes in variable consideration may result in an increase or a decrease to revenue.

Building Energy Storage Projects: The Company enters into contracts with utility companies and independent power producers to build energy storage projects. The Company determines the transaction price based on the ~~trust account (less deferred underwriting commissions~~consideration expected to be received, which includes estimates of liquidated damages or other variable consideration. Generally, each contract to design and ~~income taxes payable),~~construct an energy storage project contains one performance obligation. Multiple contracts entered into with the same customer and near the same time to ~~complete our business combination. To~~construct energy storage projects are combined in accordance with ASC 606. In these situations, the contract prices are aggregated and then allocated to each energy storage project based upon their relative stand-alone selling price.

The Company recognizes revenue over time as a result of the continuous transfer of control of its products to the customer. The continuous transfer of control to the customer is supported by clauses in the contracts that provide enforceable rights to payment of the transaction price associated with work performed to date for products that do not have an alternative use to the Company and/or the project is built on the customer’s land that is under the customer’s control.

Revenue for these performance obligations is recognized using the percentage of completion method based on cost incurred as a percentage of total estimated contract costs. Contract costs include all direct materials and labor costs related to contract performance. Since the revenue recognition of these contracts depends on estimates, which are assessed continually during the term of the contract, recognized revenues and profit are subject to revisions as the contract progresses to completion. The cumulative effects of revisions of estimated total contract costs and revenues, together with any contract reserves which may be deemed appropriate, are recorded in the period in which the facts and changes in circumstances become known. Due to uncertainties inherent in the estimation process, it is reasonably possible that these estimates will be revised in a different period.

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or LD amount when recognizing revenue. Variable consideration is included in the transaction price only to the extent that ~~our capital stock~~it is improbable that a significant reversal in the amount of cumulative revenue recognized will occur when the uncertainty is resolved. Estimating variable consideration requires certain estimates and assumptions, including whether and by how much a project will be delayed. The existence and measurement of liquidated damages may also be impacted by the Company’s judgment about the probability of favorable outcomes of customer disputes involving whether certain events qualify as force majeure or ~~debt~~the reason for the events that caused project delays. Variable consideration for LDs is estimated using the expected value of the consideration to be received.

The Company’s agreement with Atlas includes variable consideration of $25.0 million, which represents a refundable contribution the Company made to Atlas during the construction period for their first GESS. The refundable contribution will be returned to Energy Vault upon Atlas’ first GESS reaching substantial completion, subject to adjustment for potential liquidated damages if certain performance metrics are not met. The Company has determined that it is probable that the entire $25.0 million will be collected from Atlas, and therefore has included that amount in the contract’s transaction price.

Certain licensing agreements contain a significant financing component due to the customer having extended payment terms. The licensing agreements that contain a significant financing component require the Company to recognize revenue as the present value of the future customer payments. The Company determines the present value of the future customer payments using a discounted cash flow analysis and a discount rate that approximates the interest rate the Company would use in a separate financing transaction with the customer. The discount rate used in ~~whole or in part,~~the discounted cash flow analysis is highly subjective as consideration to complete our business combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.

~~As of December 31, 2021, we had cash of $396,295. We intend to use the funds held outside the trust account primarily to identify and evaluate target businesses, perform business due diligence~~it is dependent on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a business combination.

In order to fund working capital deficiencies or finance transaction costs in connection with a business combination, our Sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a business combination, we may repay such loaned amounts out of the proceeds of the Trust Account released to us. In the event that a business combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment. Up to $2,000,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant, at the option of the lender. The warrants would be identical to the private placement warrants.

~~Going Concern~~

~~In connection with~~ the Company’s assessment of ~~going concern considerations~~the customer’s credit risk.

Stock-Based Compensation

We have granted stock-based awards consisting primarily of incentive and non-qualified stock options and restricted stock units (“RSUs”) to employees, members of our Board, and non-employees.

Accounting for stock-based compensation requires us to make a number of judgments, estimates, and assumptions. If any of the estimates prove to be inaccurate, Energy Vault’s net loss and operating results could be affected adversely.

The Company’s stock-based compensation arrangements are accounted for in accordance with ~~Financial Accounting Standard Board’s Accounting Standards Update (“ASU”) 2014-15, “Disclosures~~ASC Topic 718, “Share Based Payments.” Compensation expense is recognized over the requisite service period (usually the vesting period) on a straight-line basis and adjusted for actual forfeitures of ~~Uncertainties about an Entity’s Ability to Continue~~unvested awards as they occur.

Stock options

Stock options that vest solely based on a ~~Going Concern,” we have determined that~~service condition are measured based on the liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern through at least one year from issuance date of these financial statements. These financial statements do not include any adjustments relating to the recoveryestimated fair values of the ~~recorded assets or the classification~~awards as of the ~~liabilities~~grant date using the Black-Scholes option-pricing model, which was impacted by the following assumptions:

•Expected Term — The expected term represents the period that ~~might~~Energy Vault’s awards granted are expected to be ~~necessary should~~outstanding and is determined based upon the ~~Company be unable to continue~~simplified method, as ~~a going concern.~~

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~~Off-Balance Sheet Financing Arrangements~~

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2021. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

~~Contractual Obligations~~

Wewe do not have sufficient historical information to develop reasonable expectations about future exercise patterns and post-vesting employment termination behavior.

•Expected Volatility — Since we were privately held and did not have any ~~long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than described below.~~

trading history for our common stock prior to the Merger, the expected volatility was estimated based on the average volatility for comparable publicly traded companies over a period equal to the expected term of the stock award grants.

•Risk-Free Interest Rate — We use the U.S. Treasury yield for our risk-free interest rate that corresponds with the expected term.

•Expected Dividend — Energy Vault has never paid dividends on its common stock and has no plans to pay dividends in the foreseeable future. Therefore, an expected dividend yield of zero was used.

RSUs

RSUs issued prior to the Merger were subject to both a service-based and a performance-based vesting condition. The ~~underwriters are entitled to a cash underwriting discount of $0.20 per Unit, or $5,750,000 which~~performance-based vesting condition was ~~paid~~satisfied upon the closing of the ~~IPO.~~

~~We engaged the underwriter as an advisor in connection with a business combination~~Merger. The qualifying liquidity event was not deemed probable until consummated, and therefore, stock-based compensation related to ~~assist the Company in holding meetings with its stockholders~~these RSUs remained unrecognized prior to discuss the potential business combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing the Company’s securities in connection with a business combination, provide financial advisory services to assist the Company in the Company’s efforts to obtain any stockholder approval for the business combination and assist the Company with its press releases and public filings in connection with the business combination. The Company will pay the underwriters a cash fee for such services upon the consummation of the Merger. The grant date fair value of our RSUs prior to the Merger was

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determined using valuation methodologies which utilized certain assumptions, including probability weighting of events, volatility, time to liquidation, a ~~business combination in~~risk-free interest rate, and an ~~amount equal to, in the aggregate, 3.5%~~assumption for a discount for lack of marketability (Level 3 inputs). The fair value of the ~~gross proceeds~~Company’s common stock was estimated because the common stock of Legacy Energy Vault had not yet been publicly traded prior to the ~~IPO.~~

~~Critical Accounting Policies~~

Merger.

Subsequent to the Merger date, issued RSUs generally vest based only on a service condition. The ~~preparation~~grant date fair value of ~~financial statements and related disclosures in conformity with accounting principles generally accepted in~~RSUs issued subsequent to the ~~United States~~Merger that vest solely based upon service conditions are based on the fair value of ~~America requires management to make estimates and assumptions that affect the reported amounts~~our underlying common stock as of ~~assets and liabilities, disclosure of contingent assets and liabilities at~~ the date of the grant.

The Company grants RSUs to its CEO that vest based upon a market condition. The market conditions will be satisfied upon the Company’s stock price meeting certain price targets for 20 days out of any 30 day trading period. The fair value of these RSUs is measured using a Monte Carlo simulation model on the date of the grant. The Monte Carlo simulation model requires the input of highly subjective assumptions, including the expected term of the award, the expected volatility of the Company’s common stock, risk-free interest rates, and the expected dividend yield of the Company.

Warrant Liability

Energy Vault’s financial statements reflect the impact of the publicly-traded warrants (“Public Warrants”) and ~~income and expenses during~~private warrants (“Private Warrants”) that were assumed upon the ~~periods reported. Actual results could materially differ from those estimates. We have identified~~closing of the ~~following critical accounting policies:~~

~~Warrant Liabilities~~

~~We account~~Merger. The Company accounts for warrants ~~as either equity-classified or liability-classified instruments based on an assessment~~for shares of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrantsCompany’s common stock that are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants arenot indexed to ~~the Company’s~~its own ~~common~~ stock ~~among other conditions for equity classification. This assessment is conducted~~as liabilities at ~~the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.~~

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as a liability at their initial fair value on the ~~date of issuance, and~~balance sheet. The warrants are subject to remeasurement at each balance sheet date ~~thereafter. Changes~~and any change in fair value is recognized in the ~~estimated~~Company’s statement of operations. With the completion of the redemption of Energy Vault’s public warrants on August 1, 2022, Energy Vault currently expects to incur incremental income (expense) in its consolidated statements of operations for the fair value ~~of the warrants are recognized as a non-cash gain or loss on the statements of operations.~~

~~We account~~change for the public warrants and private placement warrants (together with the public warrants, the “Warrants”) in accordance with the guidance contained in ASC 815-40. The warrants are not considered indexed to the Company’s own common stock, and as such, the warrants do not meet the criteria for equity treatment and must be recorded as liabilities. The private placement warrants and the public warrants for periods where no observable traded price was available were valued using the Modified Monte Carlo Simulation and Modified Black Scholes option pricing models (see Note 9).

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~~Class A Common Stock Subject to Possible Redemption~~

We account for our Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares of Class A common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s balance sheet.

~~We recognize changes in redemption value immediately as they occur and adjusts the carrying value of redeemable common stock to equal the redemption value~~outstanding warrant liabilities at the end of each reporting ~~period. Increases or decreases~~period only in respect of its private warrants.

The Private Warrants are classified as a Level 3 measurement and the Company uses a Black Scholes model to determine their fair value. The Black Scholes model requires the input of expected volatility, which is subjective. A significant increase in the ~~carrying amount~~expected volatility in isolation would result in a significantly higher fair value measurement.

Emerging Growth Company Accounting Election

We are an “emerging growth company” as defined in Section 2(a) of ~~redeemable common stock~~the Securities Act of 1933, as amended, and have irrevocably elected to take advantage of the benefits of this extended transition period for new or revised standard. We are ~~affected by charges against additional paid in capital~~expected to remain an emerging growth company through the end of 2023 and ~~accumulated deficit.~~

~~Net Income (Loss) per Share~~

~~We comply with accounting and disclosure requirements~~expect to continue to take advantage of ~~FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per common stock is computed by dividing net income (loss) by~~ the ~~weighted average number~~benefits of ~~common stock outstanding for~~ the extended transition period. ~~Remeasurement adjustment associated~~This may make it difficult or impossible to compare our financial results with the ~~redeemable shares~~financial results of ~~Class A common stock~~another public company that is ~~excluded from earnings per share as the redemption value approximates fair value.~~

~~The calculation of diluted income (loss) per share does~~either not ~~consider the effect~~an emerging growth company or is an emerging growth company that has chosen not to take advantage of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the private placement. The warrants are exercisable to purchase 14,749,999 Class A common stock in the aggregate. As of December 31, 2021 and 2020, the Company did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share in the earningsextended transition period exemptions for emerging growth companies because of the ~~Company. As a result, diluted net loss per common stock is the same as basic net loss per common stock for the periods presented.~~

~~Recent Accounting Standards~~

~~In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts~~potential differences in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it also simplifies the diluted earnings per share calculation in certain areas. ASU 2020-06 is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, with early adoption permitted.

~~Management does not believe that any other recently issued, but not yet effective,~~ accounting standards ~~if currently adopted, would have a material effect on our condensed~~used.

Recently Adopted and Issued Accounting Pronouncements

Recently issued and adopted/unadopted accounting pronouncements are described in Note 2 of the consolidated financial ~~statements.~~

statements included elsewhere in this Annual Report.

Item 7A. Quantitative and Qualitative Disclosures ~~about~~About Market Risk

~~Not applicable~~

Market risk represents the risk of loss that may impact our financial position because of adverse changes in financial market prices and rates.

Foreign Currency Risk

Nearly all of our letters of intent are denominated in U.S. dollars, and certain of our definitive agreements could be denominated in currencies other than the U.S. dollar, including the Euro, the Australian dollar, the Brazilian real, and the Saudi riyal. A strengthening of the U.S. dollar could increase the cost of our solutions to our international customers, which could adversely affect our business and results of operations. In addition, an increasing portion of our operating expenses is incurred outside the United States, is denominated in foreign currencies, such as the euro and the Swiss franc, and is subject to fluctuations due to changes in foreign currency exchange rates. If we become more exposed to currency fluctuations and are not able to successfully hedge against the risks associated with currency fluctuations, our results of operations could be adversely affected.

Inflation Risk

Our operations could be adversely impacted by inflation, primarily from higher material, labor, and construction costs. While it is difficult to measure the impact of inflation for ~~smaller reporting companies.~~

such estimates accurately, we believe, if our costs are affected

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due to significant inflationary pressures, we may not be able to fully offset higher costs through price increases or other corrective measures, which may adversely affect our business, financial condition, and results of operations.

Credit Risk

Credit risk refers to the risk that a counterparty may default on its contractual obligations resulting in a loss to us. Our customers include the counterparties for the sale of our energy storage systems or the licensees of our intellectual property. A loss of one or more of our significant customers, their inability to perform under their contracts, or their default in payment could harm our business and negatively impact revenue, results of operations, and cash flows.

Commodity Price Risk

We are subject to risk from fluctuating market prices of certain commodity raw materials, including cement, steel, aluminum, and lithium, that are used in the components from suppliers that are inputs into our products. Prices of these raw materials may be affected by supply restrictions or other logistic costs market factors from time to time. As we are not the direct buyer of these raw materials, we do not enter into hedging arrangements to mitigate commodity risk. Significant price changes for these raw materials could reduce our operating margins if suppliers increase component prices and we are unable to recover such increases from our customers and could harm our business, financial condition, and results of operations.

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Item 8. Financial Statements and Supplementary Data

~~This information appears following Item 15~~

Index of ~~this Report and is included herein by reference.~~

~~Item 9. Changes in and Disagreements with Accountants on Accounting and~~Consolidated Financial ~~Disclosure~~

~~None.~~

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~~Item 9A. Controls and Procedures.~~

~~Evaluation of Disclosure Controls and Procedures~~

Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end ofStatements for the fiscal ~~year~~years ended December 31, ~~2021, as such term is defined in Rules 13a-15(e)~~2022 and 15d-15(e) under the Exchange Act. Based on this evaluation, our principal executive officer and principal financial and accounting officer have concluded that our disclosure controls and procedures were not effective due to the material weakness in our internal control over financial reporting related to the Company’s accounting for complex financial instruments. As a result, we performed additional analysis as deemed necessary to ensure that our financial statements were prepared in accordance with U.S. generally accepted accounting principles. Accordingly, management believes that the financial statements included in this Form 10-K present fairly, in all material respects, our financial position, result of operations and cash flows for the periods presented.

~~Management’s Report on Internal Controls Over Financial Reporting~~

This Annual Report on Form 10-K does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

~~Changes in Internal Control over Financial Reporting~~

During the fiscal year ended December 31, 2021, other than noted below, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Management has identified a material weakness in internal controls related to the accounting for complex financial instruments as described above. While we have processes to identify and appropriately apply applicable accounting requirements, we plan to enhance our system of evaluating and implementing the accounting standards that apply to our financial statements, including through enhanced analyses by our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.

~~Item 9B. Other Information.~~

~~None.~~

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~~PART III~~

~~Item 10. Directors, Executive Officers and Corporate Governance.~~

~~Our current directors and executive officers are as follows:~~


~~Name~~	Age*	~~Position~~
~~Robert J. Laikin~~	58	~~Chief Executive Officer and Director~~

~~Larry M. Paulson~~	68	~~Chairman~~

~~Hersch Klaff~~	68	~~Director~~

~~Vincent Donargo~~	61	~~Chief Financial Officer~~

~~Jeffrey Foster~~	44	~~Director~~

~~Heather Goodman~~	47	~~Director~~

~~Ronald J. Sznaider~~	62	~~Director~~

*~~As of September 30,~~ 2021.

~~Robert J. Laikin~~ has served as our Chief Executive Officer and a member of our board of directors since our inception. Mr. Laikin cofounded and served as Chairman of Novus Capital Corporation (NASDAQ: NOVSU; NOVS; NOVSW) since its inception in March 2020 until its business combination with AppHarvest, Inc. in January 2021 and served as a director at AppHarvest, Inc. (NASDAQ: APPH; APPHW) until February 2022. Mr. Laikin has served as a managing member of Novus Capital Associates, LLC, one of our initial stockholders since its formation in October 2020. Mr. Laikin has been the managing member of L7 Investments LLC, a closely held company that invests primarily in multi-family apartments as well as single purpose buildings, hotels, divestitures and single-family homes, since January 2015. Mr. Laikin formerly served as the non-executive Chairman of the Board of Washington Prime Group In(NASDAQ: APPH, APPHW. (NYSE:WPG), where he held a director role from May 2014 to October 2021. Mr. Laikin served as Executive Advisor to the CEO and Government Relations Executive of Ingram Micro Inc. (NYSE:IM), a wholesale technology distributor and supply chain management and mobile device lifecycle services company, from November 2012 to December 2019. Previously Mr. Laikin served as the founder, Chief Executive Officer and member of the board of directors of Brightpoint, Inc. (Nasdaq:CELL) from August 1989 until it was acquired by Ingram Micro Inc. in November 2012. Mr. Laikin holds a Bachelor of Science from Indiana University. We believe Mr. Laikin is well qualified to serve on our board of directors because of his significant experience in the areas of executive leadership, corporate management, retail, real estate, business strategy and corporate finance, banking, financing, accounting, corporate management, general business and global business operations, accounting, corporate governance, public company compliance, political/governmental matters, audit/compliance, entrepreneurism, real estate development, sales, charitable/philanthropic matters, marketing, risk management/insurance, legal, investor, media and public relations, negotiation and deal structure.

~~Larry M. Paulson~~ has served as our non-executive Chairman since our inception. Mr. Paulson co-founded Novus Capital Corporation and has served as its Chief Executive Officer and a director since its inception in March 2020 until its business combination with AppHarvest, Inc. in January 2021. Mr. Paulson served as a managing member of Novus Capital Associates, LLC since its formation in October 2020 and resigned as a managing member on September 24, 2021. He has also served as principal and founder of Rancho Santa Fe Solutions, a wireless industry consulting company he founded in February 2010. From 2013 to January 2020, Mr. Paulson was with Qualcomm (Nasdaq:QCOM) where he served as Vice President of Product Management (2013-16), Vice President and President India and SAARC (2016-2018) and Vice President Sales NA and Australia (2018-Jan 2020). Prior to Qualcomm, he served as Executive Vice President and Chief Marketing Officer of Brightpoint, Inc., a provider of worldwide distribution and integrated logistics services to the wireless communications industry, from 2011 to 2013. Prior to that he served with Nokia (NYSE:NOK) from 1987 to 2009 where he had numerous roles including global Senior Vice President and General Manager CDMA Product line. Mr. Paulson holds a BA in Communications from Point Park University. We believe Mr. Paulson is well qualified to serve as our Chairman because of his more than thirty years of global senior management positions in the tech industry with expertise in wireless communications.

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~~Hersch Klaff~~ has served as a member of our board of directors since our inception. Mr. Klaff is the founder and Chief Executive Officer of Klaff Realty which he formed in 1984. Klaff Realty deploys several entrepreneurial strategies to unlock value for its investors, including its flagship business line of acquiring distressed and under-utilized retail real estate and operating businesses. To date, Klaff Realty (including through partnerships and entities managed by it or its affiliates) has acquired properties and invested in operating entities that control in excess of 200 million square feet with a value in excess of $10 billion. Mr. Klaff is currently on the board of directors of Albertsons Companies, Inc. (NYSE: ACI), Tienda Inglesa (Uruguay), and Chlorum Solutions (Brazil). Mr. Klaff began his career with the public accounting firm of Altschuler, Melvoin and Glasser in Chicago. Mr. Klaff holds a degree in Economics and Accounting from the University of the Witwatersrand in Johannesburg, South Africa. We believe Mr. Klaff is well qualified to serve on our board of directors because of his expertise in the farming industry and retail development, his accounting and investment experience, as well as his extensive knowledge of merger and acquisitions which broadens the scope of our board of directors’ oversight of our financial performance.

~~Vincent Donargo~~has served as our Chief Financial Officer since our inception. Mr. Donargo co-founded Novus Capital Corporation and served as its Chief Financial Officer since its inception in March 2020 until its business combination with AppHarvest, Inc. in January 2021, LLC. Since September 24, 2021, Mr. Donargo has served as a managing member of Novus capital Associates. Since August 2020, Mr. Donargo has served as the Chief Accounting Officer for Calumet Specialty Products Partners, LP, a leading producer of specialty hydrocarbons and fuels. From December 2019 to August 2020, Mr. Donargo provided financial advisory and consulting services to private clients. From May 2019 to December 2019, Mr. Donargo served as Executive Vice President and Chief Financial Officer of the Celadon Group Inc. (OTC:CGIPQ).

From November 2017 to April 2019, he was Vice President and Chief Accounting Officer of the Celadon Group Inc., where he was brought in to assist with Celadon Group’s financial restructuring. Celadon Group filed a voluntary petition for bankruptcy on December 8, 2019. From August 2016 to November 2017, Mr. Donargo was Executive Vice President and Chief Financial Officer of Beaulieu Group LLC, a North American carpet and flooring manufacturing company, where he assisted the company with its financial restructuring process. Beaulieu Group LLC filed a voluntary petition for bankruptcy on July 16, 2017. Prior to joining Beaulieu Group, Mr. Donargo held senior finance positions at several publicly traded companies, including Executive Vice President and Chief Financial Officer of Brightstar Corporation from April 2014 to August 2016 and Executive Vice President, Chief Financial Officer and Treasurer of Brightpoint, Inc. from September 2005 until it was acquired by Ingram Micro Inc. in November 2012. From 1998 to 2005, Mr. Donargo was the strategic business unit controller, director of finance and corporate controller of Aearo Company, a safety products manufacturing company. Prior to that, from 1990 to 1998, Mr. Donargo was employed in various financial positions with National Starch and Chemical Company, a specialty chemical manufacturing company. Mr. Donargo holds a BA in Accounting from Rutgers University.

~~Jeffrey Foster~~ has served as a member of our board of directors since our inception. Mr. Foster is an active real estate investor, managing a portfolio of multi-family, commercial and single-family assets. Mr. Foster has been the managing member of New Frontier LLC since its inception in 2012. Mr. Foster was a professional basketball player, playing for the NBA’s Indiana Pacers from 1999 through 2012. Mr. Foster holds a B.A.A.S. from Texas State University. We believe Mr. Foster is well qualified to serve on our board of directors because experience in mergers and acquisitions, investments experience and the healthcare, technology and logistics industries, and his knowledge of the public markets broadens the scope of our board of directors’ oversight of our financial performance.

~~Heather Goodman~~ has served as a member of our board of directors since our inception. Ms. Goodman has served as a director of Novus Capital Corporation since its inception in March 2020 until its business combination with AppHarvest, Inc. in January 2021. Since March 2007, Ms. Goodman has served as the Chief Operating Officer and President of True Capital Management, a boutique multi-family office specializing in business management and investment advisory services for athletes, entertainers and high net worth individuals. Previously Ms. Goodman acted as Financial Advisor at Morgan Stanley Smith Barney from February 2002 to February 2007. Ms. Goodman holds a BS in Business Administration with an emphasis in Accounting from California Polytechnic State University, San Luis Obispo. She is a Certified Public Accountant and maintains Series 63, 65 and life insurance licenses. We believe Ms. Goodman is well qualified to serve as a director given her experience in building infrastructures which have created scalable platforms to achieve goals.

~~Ronald J. Sznaider~~ has served as a member of our board of directors since our inception. Previously Mr. Sznaider has held executive leadership positions in several global technology companies. In January 2020, Mr. Sznaider founded Sznaider Consulting LLC, a firm which provides expert business advisory services, and has served as its President since its formation. Mr. Sznaider serves as a member of the board of directors of the TBG AG ownership group overseeing DTN LLC, where he has served as Vice Chairman since December 2018. Mr. Sznaider held several executive positions with DTN LLC from 1998 serving as its chief

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executive officer from November 2018 through his retirement in December 2019. Mr. Sznaider is also currently a member of the American Meteorological Society Commission on Weather, Water, and Climate Enterprise. Mr. Sznaider holds a BS from the University of Wisconsin-Madison. We believe Mr. Sznaider is well suited to serve as a Board member because he has significant operational experience in multiple technology business disciplines, considerable M&A experience, and private-public-partnership experience relating to environmental and sustainability topics including active initiatives with the United Nations.

~~Number, Terms of Office and Election of Executive Officers and Directors~~

Our board of directors is divided into three classes, with only one class of directors being elected in each year, and with each class (except for those directors appointed prior to our first annual meeting of stockholders) serving a three-year term. The term of office of the first class of directors, consisting of Ms. Goodman and Mr. Sznaider, will expire at our first annual meeting of stockholders. The term of office of the second class of directors, consisting of Messrs. Paulson and Klaff, will expire at our second annual meeting of stockholders. The term of office of the third class of directors, consisting of Messrs. Laikin and Foster, will expire at our third annual meeting of stockholders.

Our officers are appointed by the board of directors and serve at the discretion of the board of directors, rather than for specific terms of office. Our board of directors is authorized to appoint persons to the offices set forth in our bylaws as it deems appropriate. Our bylaws will provide that our officers may consist of a Chairman of the Board, a Chief Executive Officer, a Chief Financial Officer, a Secretary and such other officers (including without limitation, a President, Vice Presidents, Assistant Secretaries, and a Treasurer) as our board of directors from time to time may determine.

~~Executive Officer and Director Compensation~~

~~No executive officer has received any cash compensation for services rendered to us.~~

None of our officers or directors have received any compensation for services rendered to us. Our founders, officers, directors and their respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsors, officers, directors or our or any of their respective affiliates.

We are not party to any agreements with our officers and directors that provide for benefits upon termination of employment. The existence or terms of any such employment or consulting arrangements may influence our management’s motivation in identifying or selecting a target business, and we do not believe that the ability of our management to remain with us after the consummation of our initial business combination should be a determining factor in our decision to proceed with any potential business combination.

~~Committees of the Board of Directors~~

Our board of directors has three standing committees: an audit committee, a compensation committee and a nominating and corporate governance committee, each of which will be composed solely of independent directors. Subject to phase-in rules, the rules of the NYSE and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and the rules of the NYSE require that the compensation committee and the nominating and corporate governance committee of a listed company be comprised solely of independent directors. Each committee will operate under a charter that will be approved by our board of directors and will have the composition and responsibilities described below. The charter of each committee is available on our website.

~~Audit Committee~~

~~The members of our audit committee are Heather Goodman, Larry M. Paulson and Ronald J. Sznaider. Ms. Goodman serves as chairwoman of the audit committee.~~

Each member of the audit committee is financially literate and our board of directors has determined that Heather Goodman qualifies as an “audit committee financial expert” as defined in applicable SEC rules and has accounting or related financial management expertise.

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~~Our audit committee charter details the purpose and principal functions of the audit committee, including:~~

●assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) our independent auditor’s qualifications and independence, and (4) the performance of our internal audit function and independent auditors;

●~~the appointment, compensation, retention, replacement, and oversight of the work of the independent auditors and any other independent registered public accounting firm engaged by us;~~

●pre-approving all audit and non-audit services to be provided by the independent auditors or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures;

●~~reviewing and discussing with the independent auditors all relationships the auditors have with us in order to evaluate their continued independence;~~

●~~setting clear hiring policies for employees or former employees of the independent auditors;~~

●~~setting clear policies for audit partner rotation in compliance with applicable laws and regulations;~~

●obtaining and reviewing a report, at least annually, from the independent auditors describing (1) the independent auditor’s internal quality-control procedures and (2) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues;

●meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the independent auditor, including reviewing our specific disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;

●~~reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and~~

●reviewing with management, the independent auditors, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities.

~~Compensation Committee~~

~~The members of our compensation committee are Larry M. Paulson, Heather Goodman and Hersch Klaff. Mr. Paulson serves as chairman of the compensation committee.~~

~~Our compensation committee charter details the purpose and responsibilities of the compensation committee, including:~~

●reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;

●reviewing and making recommendations to our board of directors with respect to the compensation, and any incentive-compensation and equity-based plans that are subject to board approval of all of our other officers;

●~~reviewing our executive compensation policies and plans;~~

●~~implementing and administering our incentive compensation equity-based remuneration plans;~~

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●~~assisting management in complying with our proxy statement and annual report disclosure requirements;~~

●~~approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;~~

●~~producing a report on executive compensation to be included in our annual proxy statement; and~~

●~~reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.~~

The charter also provides that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, independent legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider the independence of each such adviser, including the factors required by the NYSE and the SEC.

~~Nominating Committee~~

The members of our nominating and corporate governance committee are Hersch Klaff, Jeffrey Foster and Ronald J. Sznaider. Mr. Klaff serves as chair of the nominating and corporate governance committee.

~~Our nominating and corporate governance committee charter details the purpose and responsibilities of the nominating and corporate governance committee, including:~~

●identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by the board, and recommending to the board director candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors;

●~~developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines;~~

●~~coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of the company; and~~

●~~reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary.~~

The charter also provides that the nominating and corporate governance committee may, in its sole discretion, retain or obtain the advice of, and terminate, any search firm to be used to identify director candidates, and will be directly responsible for approving the search firm’s fees and other retention terms.

We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders. Prior to our initial business combination, holders of our Public Shares will not have the right to recommend director candidates for nomination to our board of directors.

~~Section 16(a) Beneficial Ownership Reporting Compliance~~

Section 16(a) of the Exchange Act requires our officers, directors and persons who beneficially own more than ten percent of our common stock to file reports of ownership and changes in ownership with the SEC. These reporting persons are also required to furnish us with copies of all Section 16(a) forms they file. Based solely upon a review of such forms, we believe that since our inception on September 29, 2020 there have been no delinquent filers.

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~~Code of Ethics~~

We have adopted a code of ethics that applies to our officers and directors. We have filed copies of our code of ethics, our audit committee charter, nominating committee charter and compensation committee charter as exhibits to our registration statement in connection with our IPO. You may review these documents by accessing our public filings at the SEC’s web site at www.sec.gov and on our website. In addition, a copy of the code of ethics will be provided without charge upon request to us.

~~Conflicts of Interest~~

Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Our officers and directors may in the future become affiliated with entities that are engaged in a similar business, including other blank check companies that may have acquisition objectives that are similar to our company. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us.

We do not believe, however, that the fiduciary, contractual or other obligations or duties of our officers or directors will materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue.

~~Potential investors should also be aware of the following other potential conflicts of interest:~~

●None of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities.

●In the course of their other business activities, our officers and directors may become aware of investment and business opportunities which may be appropriate for presentation to us as well as the other entities with which they are affiliated. Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Please see “— Directors and Executive Officers” for a description of our management’s other affiliations.

●Our initial stockholders, officers and directors have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business combination. Additionally, our initial stockholders, officers and directors have agreed to waive their redemption rights with respect to any founder shares held by them if we fail to consummate our initial business combination by February 8, 2023 or during any Extension Period. However, if our initial stockholders or any of our officers, directors or affiliates acquire public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to consummate our initial business combination within the prescribed time frame. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless.

●With certain limited exceptions, the founder shares will not be transferable, assignable or salable by our initial stockholders until the earlier of: (1) one year after the completion of our initial business combination; and (2) subsequent to our initial business combination, (x) the date on which we consummate a liquidation, merger, stock exchange, reorganization or other similar transaction that results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property and (y) if the last reported sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after our initial business combination. With certain limited exceptions, the private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination. Since our initial stockholders, officers and

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directors directly or indirectly own our securities, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination.

●Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether to proceed with a particular business combination.

●Our key personnel may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such key personnel was included by a target business as a condition to any agreement with respect to our initial business combination.

~~The conflicts described above may not be resolved in our favor.~~

~~In general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business opportunities to a corporation if:~~

●~~the corporation could financially undertake the opportunity;~~

●~~the opportunity is within the corporation’s line of business; and~~

●~~it would not be fair to the corporation and its stockholders for the opportunity not to be brought to the attention of the corporation.~~

Accordingly, as a result of multiple business affiliations, our officers and directors have similar legal obligations and duties relating to presenting business opportunities meeting the above-listed criteria to multiple entities. Furthermore, our amended and restated certificate of incorporation provides that the doctrine of corporate opportunity will not apply with respect to any of our officers or directors in circumstances where the application of the doctrine would conflict with any fiduciary duties or contractual obligations they may have, and there will not be any expectancy that any of our directors or officers will offer any such corporate opportunity of which he or she may become aware to us. Below is a table summarizing the entities to which our officers and directors currently have fiduciary duties or contractual obligations that may present a conflict of interest:

~~Name of~~ ~~Individual~~	~~Entity Name~~	~~Entity’s Business~~	~~Affiliation~~
~~Robert J. Laikin~~	~~AppHarvest, Inc.~~	~~AgTech~~	~~Director~~

	~~Washington Prime Group Inc.~~	~~Publicly-traded REIT~~	~~Chairman~~

	~~L7 Investments LLC~~	~~Real Estate Investment Company~~	~~Managing Member~~

~~Vincent Donargo~~	~~Calumet Specialty Products Partners, LP~~	~~Specialty Hydrocarbons and Fuels Producer~~	~~Chief Accounting Officer~~

~~Hersch Klaff~~	~~Albertsons Companies, Inc.~~	~~Food and Drug Retailer~~	~~Director~~

	~~Klaff Realty LP~~	~~Real Estate/Private Equity~~	~~Chief Executive Officer~~

	~~Tienda Inglesa~~	~~Food Retailer~~	~~Director~~

	~~Chlorum Solutions~~	~~Industrial/ Chlor-Alkali Production~~	~~Director~~

	~~HMK Advisor LLC~~	~~Investment Adviser~~	~~Manager~~

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	~~MONS Investments LLC~~	~~Diversified Investment Holding Company~~	~~Investment Advisor~~

	~~Klaff Family Foundation~~	~~Non-Profit~~	~~Officer~~

~~Larry M. Paulson~~	~~Rancho Santa Fe Solutions LLC~~	~~Wireless Industry Consulting Company~~	~~Principal~~

~~Jeffrey Foster~~	~~New Frontier LLC~~	~~Private Investment Firm~~	~~Managing Partner~~

~~Heather Goodman~~	~~True Capital Management~~	~~Registered Investment Advisor~~	~~Chief Operating Officer, President and Director~~

	~~Global Fitness Partners LLC~~	~~Fitness Centers~~	~~Director~~

~~Ronald J. Sznaider~~	~~Sznaider Consulting LLC~~	~~Consulting Firm~~	~~President~~

	~~DTN LLC~~	~~Information Service Provider~~	~~Vice Chairman~~

Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us.

We are not prohibited from pursuing an initial business combination with a business that is affiliated with our sponsors, officers or directors. In the event we seek to complete our initial business combination with a business that is affiliated with our sponsors, officers or directors, we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm, that such initial business combination is fair to our company from a financial point of view.

In addition, our initial stockholders or any of their affiliates may make additional investments in the company in connection with the initial business combination, although, our initial stockholders and their affiliates have no obligation or current intention to do so. If our initial stockholders or any of their affiliates elects to make additional investments, such proposed investments could influence our initial stockholders’ motivation to complete an initial business combination.

Further, pursuant to a Business Combination Marketing Agreement, we have engaged Cowen and Company, LLC to provide certain specified services to us in connection with our initial business combination. In particular, Cowen and Company, LLC may assist us in holding meetings with our stockholders to discuss the potential business combination and the target business’s attributes, introduce us to potential investors that are interested in purchasing our securities in connection with the potential business combination, provide financial advisory services to assist us in our efforts to obtain any stockholder approval for the business combination and assist us with our press releases and public filings in connection with the business combination, but will not provide any M&A-related advisory services pursuant to the Business Combination Marketing Agreement. We will pay Cowen and Company, LLC the Marketing Fee for such services upon the consummation of our initial business combination in an amount equal to, in the aggregate, 3.5% of the gross proceeds of the IPO (or $10,062,50). In the ordinary course of business, Cowen and Company, LLC and its affiliates may at any time hold long or short positions, and may trade or otherwise effect transactions, for its own account and the accounts of customers, in debt or equity securities of us, our affiliates or other entities that may be involved in the transactions contemplated by the Business Combination Marketing Agreement, and may provide advisory and other services to one or more actual or potential business combination targets, investors or other parties to any business combination or other transaction entered into by us, for which services Cowen and Company, LLC or one or more of its affiliates may be paid fees, including fees conditioned upon

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the closing of a particular business combination or other transaction or transactions. This financial interest may result in Cowen and Company, LLC having a conflict of interest when providing the services to us in connection with an initial business combination. See “Underwriting — Business Combination Marketing Agreement.”

In the event that we submit our initial business combination to our public stockholders for a vote, our initial stockholders, officers and directors have agreed to vote any founder shares and any public shares held by them in favor of our initial business combination, and our officers and directors have also agreed to vote public shares purchased by them (if any) in favor of our initial business combination.

~~Limitation on Liability and Indemnification of Officers and Directors~~

Our amended and restated certificate of incorporation provides that our officers and directors will be indemnified by us to the fullest extent authorized by Delaware law, as it now exists or may in the future be amended. In addition, our amended and restated certificate of incorporation provides that our directors will not be personally liable for monetary damages to us or our stockholders for breaches of their fiduciary duty as directors, except to the extent such exemption from liability or limitation thereof is not permitted by the DGCL.

In connection with the IPO, we entered into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended and restated certificate of incorporation. Our bylaws also permit us to maintain insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification. We have obtained a policy of directors’ and officers’ liability insurance that insures our officers and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors.

~~A stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions.~~

~~We believe that these provisions, the insurance and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors.~~

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

~~Item 11. Executive Compensation~~

~~No executive officer has received any cash compensation for services rendered to us.~~

No compensation or fees of any kind will be paid to our initial stockholders, members of our management team or their respective affiliates, for services rendered prior to or in connection with the consummation of our initial business combination (regardless of the type of transaction that it is). However, they will receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses, performing business due diligence on suitable target businesses and business combinations as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of out-of-pocket expenses reimbursable by us.

After our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders. However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider an initial business combination, as it will be up to the directors of the post-combination business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic report, as required by the SEC.

We may not take any action to ensure that members of our management team maintain their positions with us after the consummation of our initial business combination, although it is possible that some or all of our officers and directors may negotiate employment or consulting arrangements to remain with us after the initial business combination. The existence or terms of any such employment or consulting arrangements to retain their positions with us may influence our management’s motivation in identifying or

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selecting a target business but we do not believe that the ability of our management to remain with us after the consummation of our initial business combination will be a determining factor in our decision to proceed with any potential business combination. We are not party to any agreements with our officers and directors that provide for benefits upon termination of employment.

~~Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.~~

~~We have no compensation plans under which equity securities are authorized for issuance.~~

~~The following table sets forth information regarding the beneficial ownership of our common stock as of the date of this annual report, by:~~

●~~each person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;~~

●~~each of our executive officers, directors and director nominees; and~~

●~~all our executive officers, directors and director nominees as a group.~~

Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares of common stock beneficially owned by them. The following table does not reflect record or beneficial ownership of the private placement warrants as these warrants are not exercisable within 60 days of the date of this annual report.

Number of

Shares of Novus

Name and Address of Beneficial Owner (1)

Common Stock

%

Directors and Executive Officers of Novus:

Robert J. Laikin (2)(3)

1,911,111

5.3
%
Hersch Klaff (4)

1,298,828

3.6
%
Larry M. Paulson (5)

966,146

2.7
%
Vincent Donargo (3)(6)

1,475,694

4.1
%
Jeffrey Foster (7)

966,146

2.7
%
Heather Goodman

291,667

*

Ronald Sznaider

182,292

*

All Directors and Executive Officers of Novus as a Group (5 Individuals)

5,980,773

16.6
%
Five Percent Holders of Novus:

Highbridge Capital management LLC (8)

1,705,105

4.7
%
Adage Capital Advisors, L.L.C. (Adage Capital Partners, L.P.) (9)

1,500,000

4.2
%
Citadel Advisors LLC (10)

1,576,535

4.4
%

*	~~Less than one percent.~~

~~(1)~~Unless otherwise indicated, the business address of each of the directors and executive officers of Novus is c/o Novus Capital Corporation II, 8556 Oakmont Lane, Indianapolis, IN 46260. Unless otherwise indicated, the business address of each of the directors and executive officers of the Combined Company is 4360 Park Terrace Drive, Suite 100, Westlake Village, California 93161.

~~(2)Includes 1,111,111 Initial Stockholder Shares held by Novus Capital Associates, LLC.~~

~~(3)~~Messrs. Laikin and Donargo are the managing members of Novus Capital Associates, LLC. The shares beneficially owned by Novus Capital Associates, LLC may also be deemed beneficially owned by Messrs. Laikin and Donargo.

~~(4)~~Mr. Klaff holds Initial Stockholder Shares through KNC I LLC and KNC II LLC. Mr. Klaff has voting and dispositive control over the shares held by these entities and may be deemed to be the beneficial owner of such shares. He disclaims beneficial ownership of any shares other than to the extent he may have a pecuniary interest therein, directly or indirectly.

~~(5)~~Mr. Paulson holds Initial Stockholder Shares through the Larry M Paulson and Gretchen V Paulson Family Trust dated Sept 4, 2019, and any amendments thereto, of which he is a trustee. Consequently, Mr. Paulson may be deemed to be the beneficial owner of

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~~such. He disclaims beneficial ownership of any shares other than to the extent he may have a pecuniary interest therein, directly or indirectly.~~

~~(6)Consists of (a) 364,583 Initial Stockholder Shares held by V Donargo LLC and (b) 1,111,111 Initial Stockholder Shares held by Novus Capital Associates, LLC.~~

~~(7)~~Mr. Foster holds Initial Stockholder Shares through New Frontier LLC, of which Mr. Foster is the manager. Mr. Foster has voting and dispositive control over the shares held by New Frontier LLC and may be deemed to be the beneficial owner of such shares. He disclaims beneficial ownership of any shares other than to the extent he may have a pecuniary interest therein, directly or indirectly.

~~(8)~~As reported by Highbridge Capital Management, LLC (“Highbridge”) on a Schedule 13G filed with the SEC on June 3, 2021. Highbridge serves as trading manager of Highbridge Tactical Credit Master Fund, L.P. and Highbridge SPAC Opportunity Fund, L.P. The principal business address of Highbridge is 277 Park Avenue, 23rd Floor, New York, New York 10172.

~~(9)~~As reported by Adage Capital Partners on a Schedule 13G filed with the SEC on February 18, 2021, which states that each of Adage Capital Partners, L.P. (“ACP”), Adage Capital Partners, GP, L.L.C. (“ACPGP”), Adage Capital Advisors, L.L.C. (“ACA”), Robert Atchinson and Phillip Gross hold shared voting and dispositive power over 1,500,000 shares. ACP has the power to dispose of and the power to vote the shares beneficially owned by it, which power may be exercised by its general partner, ACPGP. ACA, as managing member of ACPGP, directs ACPGP’s operations. Neither ACPGP nor ACA directly owns any shares. By reason of the provisions of Rule 13d-3 of the Exchange Act, ACPGP and ACA may be deemed to beneficially own the shares owned by ACP. Messrs. Atchinson and Gross, as managing members of ACA, have shared power to vote the shares beneficially owned by ACP. Neither Mr. Atchinson nor Mr. Gross directly owns any shares. By reason of the provisions of Rule 13d-3 of the Act, each of Mr. Atchinson and Mr. Gross may be deemed to beneficially own the shares beneficially owned by ACP. The principal business address of ACP, ACPGP, ACA, Mr. Atchinson and Mr. Gross is 200 Clarendon Street, 52nd Floor, Boston, Massachusetts 02116.

~~(10)~~As reported by Citadel Advisors LLC on a Schedule 13G filed with the SEC on November 22, 2021, which states that (i) each of Citadel Advisors LLC (“Citadel Advisors”), Citadel Advisors Holdings LP (“CAH”) and Citadel GP LLC (“CGP”) may be deemed to beneficially own 1,576,535 shares, (ii) each of Citadel Securities LLC (“Citadel Securities”), Citadel Securities Group LP (“CALC4”) and Citadel Securities GP LLC (“CSGP”) may be deemed to beneficially own 5,419 shares and (iii) Kenneth Griffin may be deemed to beneficially own 1,581,954 shares. The shares are held directly by Citadel Multi-Strategy Equities Master Fund Ltd. (“CM”) and Citadel Securities. Citadel Advisors is the portfolio manager for CM. CAH is the sole member of Citadel Advisors. CGP is the general partner of CAH. CALC4 is the non-member manager of Citadel Securities. CSGP is the general partner of CALC4. Mr. Griffin is the President and Chief Executive Officer of CGP and owns a controlling interest in CGP and CSGP. The principal business address of Citadel Advisors, CAH, CGP, Citadel Securities, CALC4, CSGP, CM and Mr. Griffin is 131 S. Dearborn Street, 32nd Floor, Chicago, Illinois 60603.

~~Item 13. Certain Relationships and Related Transactions, and Director Independence.~~

~~Founder Shares~~

On October 12, 2020, our founders purchased an aggregate of 7,187,500 shares of Class B common stock (the “founder shares”) for an aggregate purchase price of $25,000. The founder shares included an aggregate of up to 937,500 shares which were subject to forfeiture by our founders to the extent that the underwriter’s over-allotment was not exercised in full or in part, so that our founders would collectively own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the IPO. As a result of the underwriters’ election to fully exercise their over-allotment option, no founder shares are currently subject to forfeiture.

Our founders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the founder shares until the earlier to occur of: (1) one year after the completion of a business combination or (B) subsequent to a business combination, (x) if the last reported sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a business combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.

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~~Private Warrants~~

Simultaneously with the IPO, the founders purchased an aggregate of 5,166,666 private warrants at a price of $1.50 per private warrant ($7.75 million in the aggregate) in a private placement. Each private warrant entitles the holder to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment. Proceeds from the private warrants were added to the net proceeds from the IPO held in the trust account. If we do not complete an initial business combination by February 8, 2023, the proceeds from the sale of the private warrants will be used to fund the redemption of the public shares (subject to the requirements of applicable law) and the private warrants will expire worthless. The private warrants will be non-redeemable and exercisable on a cashless basis so long as they are held by our founders or their permitted transferees.

~~Registration Rights~~

Pursuant to a registration rights agreement entered into on February 3, 2021, the holders of the founder shares, private warrants and any warrants that may be issued upon conversion of the Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the private warrants and warrants that may be issued upon conversion of Working Capital Loans) will have registration rights to require the Company to register a sale of any of the securities for resale (in the case of the founder shares, only after conversion to shares of Class A common stock). The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a business combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. Notwithstanding the foregoing, Cowen Investments may not exercise its demand and “piggyback” registration rights after five and seven years, respectively, after the effective date of our IPO. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

~~Promissory Note and Potential Related Party Loans~~

On October 1, 2020, certain of the Company’s directors agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to our IPO pursuant to promissory notes (the “Promissory Notes”). From October 1, 2020 through December 31, 2020, the Company borrowed an aggregate of $160,000 under the Promissory Notes. The Promissory Notes are non-interest bearing and are payable on the earlier of (i) September 30, 2021 and (ii) the consummation of our IPO. The outstanding balance under the Promissory Notes was fully repaid on February 10, 2021.

In order to finance transaction costs in connection with a business combination, our founders or certain of the Company’s directors and officers may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a business combination, the Company would repay the Working Capital Loans out of the proceeds of the trust account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the trust account. In the event that a business combination does not close, the Company may use a portion of proceeds held outside the trust account to repay the Working Capital Loans, but no proceeds held in the trust account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a business combination, without interest, or, at the lender’s discretion, up to $2,000,000 of such Working Capital Loans may be convertible into warrants of the post-business combination entity at a price of $1.50 per warrant. The warrants would be identical to the private warrants.

~~Business Combination Marketing Agreement~~

The Company engaged the underwriters as an advisor in connection with a business combination to assist the Company in holding meetings with its stockholders to discuss the potential business combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing the Company’s securities in connection with a business combination, provide financial advisory services to assist the Company in the Company’s efforts to obtain any stockholder approval for the business combination and assist the Company with its press releases and public filings in connection with the business combination. The Company will pay the underwriters a cash fee for such services upon the consummation of a business combination in an amount equal to, in the aggregate, 3.5% of the gross proceeds of our IPO.

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~~Insider Letter Agreements~~

We have entered into a letter agreement with our initial stockholders, officers and directors pursuant to which (x) they have agreed to waive: (1) their redemption rights with respect to any founder shares and public shares held by them, as applicable, in connection with the completion of our initial business combination; (2) their redemption rights with respect to any founder shares and public shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination by February 8, 2023 or (B)with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity; and (3) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination by February 8, 2023 or during any Extension Period (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame), and (y) the founder shares are subject to certain transfer restrictions, as described under “Description of Securities — Founder Shares”

~~Transactions in Connection with the Proposed Business Combination with Energy Vault and PIPE~~

~~Lock-Up Agreements~~

In connection with the closing, the founders and certain stockholders of Energy Vault will agree, subject to certain exceptions, not to (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act, and the rules and regulations of the SEC promulgated thereunder, the lock-up shares (which, in the case of the founders, are the founder shares, the private warrants and the shares of combined company common stock issuable upon exercise of the private warrants), (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of the lock-up shares, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii). The lock-up period shall terminate upon the earlier of (i) with respect to 50% of the lock-up shares, 180 days after the closing and (ii) with respect to the remaining 50% of the lock-up shares, one year after the Closing; provided however that the lock-up period shall terminate 180 days after the Closing with respect to the private warrants and the shares of combined company common stock issuable upon exercise of the private warrants.

~~Registration Rights Agreement~~

In connection with the closing, the founders and security holders of Energy Vault will enter into an amended and restated registration rights agreement, which amends and restates the registration rights agreement. Pursuant to the amended and restated registration rights agreement, Novus will agree that, no later than (i) 30 calendar days after the closing and (ii) 20 business days after the closing, Novus will file with the SEC (at Novus’s sole cost and expense) a resale registration statement, and Novus shall use commercially reasonable efforts to have the resale registration statement declared effective as soon as practicable after the filing thereof. In certain circumstances, the founders and the Energy Vault security holders may each demand up to two registrations, which may be underwritten offerings, and all of the holders will be entitled to piggyback registration rights.

~~Sponsor Restricted Stock Agreement~~

In connection with the closing, the initial stockholders and certain stockholders of Energy Vault will agree, that the Restricted Shares (defined as 4,851,561 founder shares) shall be subject to the transfer restrictions set forth herein until satisfaction of the following trigger events (each, a “Triggering Event”):

~~(a)~~

808,594 founder shares shall be released upon the date on which (x) the closing price of the combined company common stock (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) exceeds $12.50 per share for any 20 trading days within a 30-trading day period occurring from the announcement of the PIPE through the thirty-six (36) month anniversary of the closing of the Merger or (ii) the closing of a sale, merger, the remaining lock-up shares liquidation, or exchange offer transaction after the closing date of the Merger which results in the stockholders of the combined company having the right to exchange their shares for cash, securities or other property having a value of at least $12.50 per share.

~~Table of Contents~~

~~(b)~~

808,594 founder shares shall be released upon the date on which (x) the closing price of the combined company common stock (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) exceeds $15.00 per share for any 20 trading days within a 30-trading day period occurring from the announcement of the PIPE through the thirty-six (36) month anniversary of the closing of the Merger or (ii) the closing of a sale, merger, the remaining lock-up shares liquidation, or exchange offer transaction after the closing date of the Merger which results in the stockholders of the combined company having the right to exchange their shares for cash, securities or other property having a value of at least $15.00 per share.

~~(c)~~

3,234,375 founder shares, shall be subject to forfeiture (the “Forfeiture Percentage”) proportionately with redemptions of cash from the Trust Account held by the Trustee in excess of $25,000,000. The Forfeiture Percentage shall be calculated by (1) dividing (A) the aggregate dollar amount of cash redeemed from the trust account in excess of $25,000,000 by (B) $287,500,000 and then (2) multiplying the quotient obtained in subsection (c)(1) by 45.0% of the founder shares. Notwithstanding the foregoing, in the event that more than 26,250,000 shares of Class A common stock are redeemed from the trust account (resulting in $262,500,000 of cash redeemed from the trust account assuming a redemption price of $10.00 per share), such 3,234,375 Founder Shares shall be forfeited in lieu of applying the Forfeiture Percentage.

~~The remaining 1,617,187 founder shares are not Restricted Shares and are not subject to the vesting restrictions or forfeiture provisions set forth in clauses (a)-(c) above.~~

~~Sponsor Support Agreement~~

On September 8, 2021, Novus, Energy Vault and the founders entered into the Sponsor Support Agreement pursuant to which the founders agreed to vote all of their founder shares and shares of Novus common stock in favor of the approval and adoption of the Merger and other transactions contemplated by the Business Combination Agreement. Additionally, such Founders have agreed, among other things, not to (a) transfer any of their shares of founder shares or common stock (or enter into any arrangement with respect thereto), subject to certain customary exceptions, (b) enter into any voting arrangement that is inconsistent with the Sponsor Support Agreement or (c) exercise their redemption rights in connection with the Merger.

~~PIPE~~

In connection with the PIPE, Robert Laikin, our Chief Executive Officer and a director, Larry Paulson, our Chairman, and Hersch Klaff, Jeffrey Foster, Ronald Sznaider and Heather Goodman each a director of Novus, or their affiliates, agreed to purchase 250,000 shares, 50,000 shares, 250,000 shares, 250,0000 shares, 50,000 shares and 250,000 shares, respectively, at a purchase price of $10.00 per share and on the same terms and conditions as the other investors in the PIPE.

~~Other Arrangements~~

Our founders, officers and directors or any of their respective affiliates will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsors, officers, directors or our or any of their respective affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.

In addition, in order to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination, our founders, officers and directors and their affiliates may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used for such repayment. Up to $2,000,000 of such loans may be convertible into warrants at a price of $1.50 per warrant at the option of the lender. The units would be identical to the private placement warrants issued to our founders. The terms of such loans by our founders, officers and directors and their affiliates, if any, have not been determined and no written agreements exist with respect to such loans. Prior to the completion of our business combination, we do not expect to seek loans from parties other than our founders, an affiliate of our founders, officers and directors and their affiliates, if any, as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.

~~Table of Contents~~

No compensation or fees of any kind will be paid to the Novus initial stockholders, members of our management team or their respective affiliates, for services rendered prior to or in connection with the consummation of our initial business combination (regardless of the type of transaction that it is). However, such individuals will receive reimbursement for any out-of-pocket expenses incurred by them in connection with activities on our behalf, such as identifying potential target businesses, performing business due diligence on suitable target businesses and business combinations as well as traveling to and from the offices, plants or similar locations of prospective target businesses to examine their operations. There is no limit on the amount of out-of-pocket expenses reimbursable by us.

After our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees from the Combined Company with any and all amounts being fully disclosed to stockholders, to the extent then known, in the proxy solicitation materials furnished to our stockholders. However, the amount of such compensation may not be known at the time of the stockholder meeting held to consider an initial business combination, as it will be up to the directors of the post-combination business to determine executive and director compensation. In this event, such compensation will be publicly disclosed at the time of its determination in a Current Report on Form 8-K or a periodic report, as required by the SEC.

All ongoing and future transactions between us and any of our officers and directors or their respective affiliates will be on terms believed by us to be no less favorable to us than are available from unaffiliated third parties. Such transactions will require prior approval by a majority of our uninterested “independent” directors or the members of our board who do not have an interest in the transaction, in either case who had access, at our expense, to our attorneys or independent legal counsel. We will not enter into any such transaction unless our disinterested “independent” directors determine that the terms of such transaction are no less favorable to us than those that would be available to us with respect to such a transaction from unaffiliated third parties.

~~Related Party Policy~~

Our Code of Ethics requires us to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions approved by our board of directors (or the appropriate committee of our board of directors) or as disclosed in our public filings with the SEC. Under our Code of Ethics, conflict of interest situations will include any financial transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the company. Our Code of Ethics is available on our website.

In addition, our audit committee, pursuant to a written charter, is responsible for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous written consent of all of the members of the audit committee will be required to approve a related party transaction. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsors, officers or directors, or our or any of their affiliates.

These procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer.

To further minimize conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated with any of our sponsors, officers or directors unless we, or a committee of independent and disinterested directors, have obtained an opinion from an independent investment banking firm which is a member of FINRA or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. There will be no finder’s fees, reimbursements or cash payments made by us to our founders, officers or directors or our or any of their respective affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds held in the trust account prior to the completion of our initial business combination:

●~~reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination;~~

●payment to Cowen and Company, LLC of its Marketing Fee, fees for any financial advisory, placement agency or other similar investment banking services Cowen and Company, LLC may provide to our company in the future, and reimbursement of Cowen and Company, LLC for any out-of-pocket expenses incurred by it in connection with the performance of such services; and

~~Table of Contents~~

●repayment of loans which may be made by our founders, officers and directors and their affiliates to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $2,000,000 of such loans may be convertible into warrants at a price of $1.50 per warrant at the option of the lender.

~~Item 14. Principal Accounting Fees and Services.~~

~~The following is a summary of fees paid or to be paid to Marcum LLP, or Marcum, for services rendered.~~

~~Audit Fees~~. Audit fees consist of fees billed for professional services rendered for the audit of our year-end financial statements and services that are normally provided by Marcum in connection with regulatory filings. The aggregate fees billed by Marcum for professional services rendered for the audit of our annual financial statements, review of the financial information included in our Forms 10-Q for the respective periods and other required filings with the SEC for the year ended December 31, 2021 and for the period from September 29, 2020 (inception) through December 31, 2020 totaled approximately $161,000 and $57,500, respectively. The above amounts include interim procedures and audit fees, as well as attendance at audit committee meetings.

~~Audit-Related Fees.~~ Audit-related services consist of fees billed for assurance and related services that are reasonably related to performance of the audit or review of our financial statements and are not reported under “Audit Fees.” These services include attest services that are not required by statute or regulation and consultations concerning financial accounting and reporting standards. We did not pay Marcum for consultations concerning financial accounting and reporting standards for the year ended December 31, 2021 and for the period from September 29, 2020 (inception) through December 31, 2020.

~~Tax Fees~~. We did not pay Marcum for tax planning and tax advice for the year ended December 31, 2021. We paid Marcum $8,240 for tax services for the period from September 29, 2020 (inception) through December 31, 2020.

~~All Other Fees~~~~. We did not pay Marcum for other services for the year ended December 31, 2021 and for the period from September 29, 2020 (inception) through December 31, 2020.~~

~~Pre-Approval Policy~~

Our audit committee was formed upon the consummation of our Initial Public Offering. As a result, the audit committee did not pre-approve all of the foregoing services, although any services rendered prior to the formation of our audit committee were approved by our board of directors. Since the formation of our audit committee, and on a going-forward basis, the audit committee has and will pre-approve all auditing services and permitted non-audit services to be performed for us by our auditors, including the fees and terms thereof (subject to the de minimis exceptions for non-audit services described in the Exchange Act which are approved by the audit committee prior to the completion of the audit).

~~PART IV~~

~~Item 15. Exhibits, Financial Statement Schedules.~~

~~(a)The following documents are filed as part of this Form 10-K:~~

~~(1)~~

~~Financial Statements:~~


Contents			Page
Report of Independent Registered Public Accounting Firm (BDO USA, LLP, New York, NY PCAOB ID# 243)		~~F-2~~
~~Balance Sheets~~	~~F-3~~
~~Statements of Operations~~	~~F-4~~
~~Statements of Changes in Stockholders’ (Deficit) Equity~~	~~F-5~~
~~Statements of Cash Flows~~	~~F-6~~
~~Notes to Financial Statements~~	~~F-7~~

~~(2)~~

~~Financial Statement Schedules:~~60

~~None.~~

~~Table of Contents~~

~~(3)~~

~~Exhibits~~

We hereby file as part of this Report the exhibits listed in the attached Exhibit Index. Exhibits which are incorporated herein by reference can be inspected and copied at the public reference facilities maintained by the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Copies of such material can also be obtained from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates or on the SEC website at www.sec.gov.

Incorporated by Reference
Exhibit Number

Description of Document
Schedule/Form

File Number

Exhibits

Filing Date
2.1*

Business Combination Agreement and Plan of Reorganization, dated September 8, 2021, by and among Novus, Merger Sub and Energy Vault (included as Annex A to this proxy statement/prospectus)

Form 8-K

001-39982

2.1

September 9, 2021

3.1

Certificate of Incorporation of Novus

Form S-1

333-252079

3.1

January 13, 2021

3.2

Amended and Restated Certificate of Incorporation of Novus

Form 8-K

001-39982

3.1

February 8, 2021

3.3

Bylaws of Novus

Form S-1

333-252079

3.3

January 13, 2021

3.4

Form of Amended and Restated Certificate of Incorporation of Combined Company (included as Annex B to this proxy statement/prospectus)

Form 8-K

001-39982

2.1

September 9, 2021

3.5

Form of Amended and Restated Bylaws of Combined Company (included in Exhibit 2.1)

Form 8-K

001-39982

2.1

September 9, 2021

4.1

Specimen Unit Certificate of Novus

Form S-1

333-252079

4.1

January 13, 2021

4.2

Specimen Class A Common Stock Certificate of Novus

Form S-1

333-252079

4.2

January 13, 2021

4.3

Specimen Warrant Certificate of Novus

Form S-1

333-252079

4.3

January 13, 2021

4.4

Warrant Agreement, dated February 3, 2021, by and between Continental Stock Transfer & Trust Company and Novus

Form 8-K

001-39982

4.1

February 8, 2021

10.1

Business Combination Marketing Agreement, dated February 3, 2021, between Novus and Cowen

Form 8-K

001-39982

1.2

February 8, 2021

10.2

Investment Management Trust Agreement, dated February 3, 2021, by and between Continental Stock Transfer & Trust Company and Novus

Form 8-K

001-39982

10.2

February 8, 2021

~~Table of Contents~~

10.3

Registration Rights Agreement, dated February 3, 2021, by and among Novus and certain stockholders

Form 8-K

001-39982

10.3

February 8, 2021

10.4

Form of Amended and Restated Registration Rights Agreement, by and among Novus, Novus Initial Stockholders and New Holders (included in Exhibit 2.1)

Form 8-K

001-39982

2.1

September 9, 2021

10.5

Form of Promissory Note of Novus

Form S-1

333-252079

10.1

January 13, 2021

10.6

Stockholder Support Agreement, dated September 8, 2021, by and among Novus and certain stockholders

Form 8-K

001-39982

10.1

September 9, 2021

10.7

Sponsor Support Agreement, dated as of September 8, 2021, by and among Novus and the Initial Stockholders

Form 8-K

001-39982

10.2

September 9, 2021

10.8

Form of PIPE Subscription Agreement

Form 8-K

001-39982

10.3

September 9, 2021

10.9

Warrant Subscription Agreement, dated February 2, 2021, by and between Novus and NCCII

Form S-1

333-252079

10.7

January 13, 2021

10.10

Form of Letter Agreement from Novus’s officers and directors and other initial stockholders

Form S-1

333-252079

10.2

January 13, 2021

10.11

Form of Lock-Up Agreement (included in Exhibit 2.1)

Form 8-K

001-39982

2.1

September 9, 2021

10.12

Form of Amended and Restated Sponsor Restricted Stock Agreement, by and among Novus, Novus Initial Stockholders and Energy Vault (included in Annex A to this proxy statement/prospectus)

Form S-4

333-260307

10.12

December 30, 2021

23.1

Consent of Marcum LLP, independent registered public accounting firm of Novus

24.1

Power of Attorney (included on the signature page to this Form 10-K)*

101.INS

Inline XBRL Instance Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Labels Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

~~Table of Contents~~

~~104~~

~~Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)~~

●

Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601. The Registrant agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request.

~~Table of Contents~~

~~SIGNATURES~~

Pursuant to the requirements of the Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized, in New York City, New York, on the 10th day of February, 2022.


~~Novus Capital Corporation II~~

~~By: /s/ Robert J. Laikin~~
~~Name: Robert J. Laikin~~
~~Title: Chief Executive Officer~~

Consolidated Balance Sheets as of December 31, 202 2 and 202 1

~~POWERS OF ATTORNEY~~

KNOW ALL BY THESE PRESENTS, that each of the undersigned constitutes and appoints each of Vincent Donargo and Robert J. Laikin, each acting alone, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for such person and in his or her name, place and stead, in any and all capacities, to sign this annual report on Form 10-K (including amendments thereto), and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, each acting alone, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming that any such attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

~~Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this annual report has been signed below by the following persons in the capacities and on the dates indicated.~~

				61
~~Name~~		~~Position~~	~~Date~~

~~/s/ Robert J. Laikin~~	~~Chief Executive Officer and Director~~	~~February 10, 2022~~
~~Robert J. Laikin~~	~~(Principal Executive Officer)~~

~~/s/ Larry M. Paulson~~	~~Chairman of the Board of Directors and Director~~	~~February 10, 2022~~
~~Larry M. Paulson~~

~~/s/ Vincent Donargo~~	~~Chief Financial Officer~~	~~February 10, 2022~~
~~Vincent Donargo~~	~~(Principal Financial and Accounting Officer)~~

~~/s/ Heather Goodman~~	~~Director~~	~~February 10, 2022~~
~~Heather Goodman~~

~~/s/ Ronald Sznaider~~	~~Director~~	~~February 10, 2022~~
~~Ronald Sznaider~~

~~/s/ Hersch Klaff~~	~~Director~~	~~February 10, 2022~~
~~Hersch Klaff~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~INDEX TO CONSOLIDATED FINANCIAL STATEMENTS~~


~~Report of Independent Registered Public Accounting Firm~~ ~~(PCAOB ID # 688)~~	~~F-2~~
~~Consolidated Financial Statements:~~
~~Consolidated Balance Sheets~~	~~F-3~~
Consolidated Statements of Operations and Comprehensive Loss for the Years Ended December 31, 202 2 and 202 1	~~F-4~~		62
Consolidated Statements of ~~Changes in~~Convertible Preferred Stock and Stockholders’ Equity (Deficit) ~~Equity~~ for the Years Ended December 31, 20 2 2 and 2021		~~F-5~~		63
Consolidated Statements of Cash Flows for the Years Ended December 31, 2022 and 2021		~~F-6~~		64
Notes to Consolidated Financial Statements		~~F-7~~		65

~~F-1~~

Table of Contents

~~REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM~~

~~To the~~ Report of Independent Registered Public Accounting Firm

Shareholders and Board of Directors ~~of Novus Capital Corporation II~~

Energy Vault Holdings, Inc.

Westlake Village, California 91361

Opinion on the consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of ~~Novus Capital Corporation II~~Energy Vault Holdings, Inc (the “Company”) as of December 31, ~~2021~~2022 and ~~2020,~~2021, the related consolidated statements of operations ~~consolidated changes in~~and comprehensive loss, convertible preferred stock and stockholders’ ~~(deficit)~~ equity (deficit), and ~~consolidated~~ cash flows for ~~year~~each of the two years in the period ended December 31, ~~2021 and for the period from September 29, 2020 (inception) through December 31, 2020,~~2022, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company ~~as of~~at December 31, ~~2021~~2022 and ~~2020,~~2021, and the results of its operations and its cash flows for each of the ~~year~~two years in the period ended December 31, ~~2021 and for the period from September 29, 2020 (inception) through December 31, 2020,~~2022, in conformity with accounting principles generally accepted in the United States of America.

~~Explanatory Paragraph – Going Concern~~

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company’s business plan is dependent on the completion of a business combination and the Company’s cash and working capital as of December 31, 2021 are not sufficient to complete its planned activities. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our ~~audit.~~audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ~~(the “PCAOB”~~(“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 ~~audit~~audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our ~~audit,~~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 ~~audit~~audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our ~~audit~~audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our ~~audit provides~~audits provide a reasonable basis for our opinion.

/~~S/ Marcum~~s/ BDO USA, LLP

~~Marcum LLP~~

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

~~Boston, MA~~

~~February 10, 2022~~

2020.

~~F-2~~

Melville, New York

April 12, 2023

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~CONSOLIDATED BALANCE SHEETS~~

ENERGY VAULT HOLDINGS, INC.

December 31,


2021

2020
ASSETS

Current assets

Cash

$
396,295

$
172,854
Prepaid expenses

114,583

—
Total Current Assets

510,878

172,854

Deferred offering costs

—

37,042
Marketable securities held in Trust Account

287,515,823

—
TOTAL ASSETS

$
288,026,701

$
209,896

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY


Current liabilities

Accrued expenses

$
208,913

$
1,000
Accrued offering costs

—

25,000
Promissory note — related party

—

160,000
Total Current Liabilities

208,913

186,000

Warrant liability

18,437,499

—
TOTAL LIABILITIES

18,646,412

186,000




Commitments and Contingencies





Class A common stock subject to possible redemption 28,750,000 and 0 shares at redemption value at December 31, 2021 and 2020, respectively

287,500,000

—




Stockholders’ (Deficit) Equity




Preferred stock, $0.0001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding

—

—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 7,187,500 shares issued and outstanding, at December 31, 2021 and 2020

719

719
Additional paid-in capital

—

24,281
Accumulated deficit

(18,120,430)

(1,104)
Total Stockholders’ (Deficit) Equity

(18,119,711)

23,896
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

$
288,026,701

$
209,896

Consolidated Balance Sheets

(In thousands, except par value)

December 31,
2022 2021
Assets
Current Assets
Cash and cash equivalents $ 203,037 $ 105,125
Restricted cash 83,145 —
Accounts receivable 37,460 —
Contract assets 28,978 —
Customer financing receivable, current portion 1,500 —
Inventory 4,378 —
Prepaid expenses and other current assets 31,569 5,538
Total current assets 390,067 110,663
Property and equipment, net 3,044 11,868
Operating lease right-of-use assets 1,442 1,238
Customer financing receivable, long-term portion 8,260 —
Other assets 13,900 1,525
Total Assets $ 416,713 $ 125,294
Liabilities, Convertible Preferred Stock, and Stockholders’ Equity (Deficit)
Current Liabilities
Accounts payable $ 60,315 $ 1,979
Accrued expenses 14,749 4,704
Contract liabilities, current portion 49,434 —
Finance leases, current portion 38 48
Operating leases, current portion 787 612
Total current liabilities 125,323 7,343
Deferred pension obligation 890 734
Asset retirement obligation 560 978
Contract liabilities, long-term portion 1,500 1,500
Long-term finance leases 16 34
Long-term operating leases 709 662
Warrant liability 2 —
Total liabilities 129,000 11,251
Commitments and contingencies (Note 18)
   Convertible preferred stock, $0.0001 par value; no shares authorized, none issued and outstanding at December 31, 2022; 85,741 shares authorized, 85,741 issued and outstanding at December 31, 2021; liquidation preference of $171,348 — 182,709
Stockholders’ Equity (Deficit)
   Preferred stock, $0.0001 par value; 5,000 shares authorized, none issued and outstanding — —
   Common stock, $0.0001 par value; 500,000 shares authorized, 138,530 issued and outstanding at December 31, 2022; 120,568 shares authorized, 20,432 issued and outstanding at December 31, 2021 14 —
Additional paid-in capital 435,852 713
Accumulated deficit (147,265) (68,966)
Accumulated other comprehensive loss (888) (413)
Total stockholders’ equity (deficit) 287,713 (68,666)
Total Liabilities, Convertible Preferred Stock, and Stockholders’ Equity (Deficit) $ 416,713 $ 125,294

The accompanying notes are an integral part of ~~the~~these consolidated financial statements.

~~F-3~~

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~CONSOLIDATED STATEMENTS OF OPERATIONS~~

ENERGY VAULT HOLDINGS, INC.

For the Period from

September 29, 2020

Year Ended

(Inception) Through

December 31,

December 31,

2021

2020
Operating and formation costs

$
1,247,217

$
1,104
Loss from operations

(1,247,217)

(1,104)

Other income (expense):

Interest earned on marketable securities held in Trust Account

15,823

—
Transaction costs incurred in connection with warrants

(241,311)

—
Change in fair value of warrants

(1,865,833)

—
Total other expense, net

(2,091,321)

—

Net loss

$
(3,338,538)

$
(1,104)

Basic and diluted weighted average shares outstanding, Class A common stock

25,678,082

—
Basic and diluted net loss per share, Class A common stock

$
(0.10)

$
—
Basic and diluted weighted average shares outstanding, Class B common stock

7,087,329

6,250,000
Basic and diluted net loss per share, Class B common stock

$
(0.10)

$
—

Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except per share data)

Year Ended December 31,
2022 2021
Revenue $ 145,877 $ —
Operating expenses:
Cost of revenue 86,580 —
Sales and marketing 12,582 845
Research and development 50,058 7,912
General and administrative 56,912 18,056
Asset impairment 2,828 2,724
Loss from operations (63,083) (29,537)
Other income (expense)
Interest expense (2) (7)
Change in fair value of warrant liability 2,330 —
Transaction costs (20,586) —
Other income (expense), net 3,469 (1,793)
Loss before income taxes (77,872) (31,337)
Provision for income taxes 427 1
Net loss $ (78,299) $ (31,338)
Net loss per share — basic and diluted $ (0.64) $ (2.45)
Weighted average shares outstanding — basic and diluted 123,241 12,780
Other comprehensive income (loss) — net of tax
Actuarial gain (loss) on pension $ (188) $ 166
Foreign currency translation gain (loss) (287) 1,519
Total other comprehensive income (loss) (475) 1,685
Total comprehensive loss $ (78,774) $ (29,653)

The accompanying notes are an integral part of ~~the~~these consolidated financial statements.

~~F-4~~

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ (DEFICIT) EQUITY~~

ENERGY VAULT HOLDINGS, INC.

Class A

Class B

Additional

Total

Common Stock

Common Stock

Paid-in

Accumulated

Stockholders’


Shares

Amount

Shares

Amount

Capital

Deficit

Equity (Deficit)
Balance — September 29, 2020 (Inception)

0

0

0

0

0

0

0

Issuance of Class B Common Stock to Sponsor

—

$
—

7,187,500

$
719

$
24,281

$
—

$
25,000

Net loss

—

—

—

—

—

(1,104)

(1,104)

Balance – December 31, 2020

—

$
—

7,187,500

$
719

$
24,281

$
(1,104)

$
23,896

Remeasurement adjustment on redeemable common stock

—

—

—

—

(1,935,948)

(14,780,788)

(16,716,736)

Cash paid in excess of private warrants

—

—

—

—

1,911,667

—

1,911,667

—

Net loss

—

—

—

—

—

(3,338,538)

(3,338,538)

Balance – December 31, 2021

—

$
—

7,187,500

$
719

$
—

$
(18,120,430)

$
(18,119,711)

Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)

(In thousands)

Convertible Preferred Stock Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity ( Deficit)
Shares (1)
Amount
Shares (1)
Amount
Balance at December 31, 2020 63,805 $ 62,042 14,404 $ — $ 99 $ (37,628) $ (2,098) $ (39,627)
Issuance of B-1 preferred stock for cash 7,153 15,320 — — — — —
Series B-1 preferred stock issuance costs — (25) — — — — —
Issuance of Series C preferred stock for cash 14,783 107,000 — — — — —
Series C preferred stock issuance costs — (1,628) — — — — —
Exercise of stock options — — 373 — 10 — 10
Stock based compensation — — 5,655 — 604 — 604
Net loss — — — — — (31,338) (31,338)
Actuarial gain on pension — — — — — — 166 166
Foreign currency translation gain — — — — — — 1,519 1,519
Balance at December 31, 2021 85,741 $ 182,709 20,432 $ — $ 713 $ (68,966) $ (413) $ (68,666)
Conversion of convertible preferred stock into common stock in connection with reverse recapitalization (85,741) (182,709) 85,741 9 182,700 — — 182,709
Issuance of common stock upon the reverse recapitalization, net of transaction costs — — 27,553 3 191,856 — — 191,859
Exercise of stock options — — 196 1 170 — — 171
Exercise of warrants — — 2,873 — 25,360 — — 25,360
Stock based compensation — — — — 41,058 — — 41,058
Vesting of RSUs, net of shares withheld for payroll taxes — — 1,735 1 (6,005) — — (6,004)
Net loss — — — — — (78,299) — (78,299)
Actuarial loss on pension — — — — — — (188) (188)
Foreign currency translation loss — — — — — — (287) (287)
Balance at December 31, 2022 — $ — 138,530 $ 14 $ 435,852 $ (147,265) $ (888) $ 287,713

(1) The number of shares of convertible preferred stock and common stock prior to the Merger (defined in Note 1) have been retroactively restated to reflect the exchange ratio of 6.7735 established in the Merger as described in Note 1 and Note 3.

The accompanying notes are an integral part of ~~the~~these consolidated financial statements.

~~F-5~~

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

ENERGY VAULT HOLDINGS, INC.

For the Period from

September 29, 2020

Year Ended

(Inception) Through

December 31,

December 31,

2021

2020
Cash Flows from Operating Activities:




Net loss

$
(3,338,538)

$
(1,104)
Adjustments to reconcile net loss to net cash used in operating activities:

Change in fair value of warrant liabilities

1,865,833

—
Interest earned on marketable securities held in Trust Account

(15,823)

—
Transaction costs incurred in connection with warrants

241,311

—
Changes in operating assets and liabilities:

Prepaid expenses

(114,583)

—
Accrued expenses

207,913

1,000
Net cash used in operating activities

(1,153,887)

(104)

Cash Flows from Investing Activities:

Investment of cash into Trust Account

(287,500,000)

—
Net cash used in investing activities

(287,500,000)

—




Cash Flows from Financing Activities:




Proceeds from sale of Units, net of underwriting discounts paid

281,750,000

—
Proceeds from issuance of Class B common stock to Sponsor

—

25,000
Proceeds from promissory note - related party

—

160,000
Proceeds from sale of Private Placement Warrants

7,750,000

—
Repayment of promissory note – related party

(160,000)

—
Payment of offering costs

(462,672)

(12,042)
Net cash provided by financing activities

288,877,328

172,958




Net Change in Cash

223,441

172,854
Cash – Beginning

172,854

—
Cash – Ending

$
396,295

$
172,854

Non-cash investing and financing activities:

Deferred offering costs included in accrued offering costs

$
—

$
25,000
Remeasurement adjustment on redeemable common stock

$
16,716,736

$
—
Payment of deferred offering costs by the Sponsor in exchange for the issuance of Class B common stock

$
35,000

$
—

Consolidated Statements of Cash Flows

(In thousands)

Year Ended December 31,
2022 2021
Cash Flows From Operating Activities
Net loss $ (78,299) $ (31,338)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 7,743 2,320
Non-cash operating lease expense 744 117
Non-cash interest income (365) —
Stock based compensation 41,058 500
Asset impairment 2,828 3,225
Gain on change in fair value of warrant liability (2,330) —
Change in pension obligation (12) 92
Change in asset retirement obligation (392) (52)
Foreign exchange gains and losses 316 64
Changes in operating assets and liabilities:
Accounts receivable (37,460) —
Contract assets (28,978) —
Prepaid expenses and other current assets (29,613) 217
Inventory (4,378) (213)
Customer financing receivable (9,725) —
Other assets (1,052) —
Accounts payable and accrued expenses 67,861 3,002
Contract liabilities 49,434 —
Operating lease liabilities (726) —
Net cash used in operating activities (23,346) (22,066)
Cash Flows From Investing Activities
Purchase of property and equipment (2,319) (170)
Purchase of convertible notes (2,000) (1,000)
Purchase of equity securities (9,000) —
Net cash used in investing activities (13,319) (1,170)
Cash Flows From Financing Activities
Proceeds from exercise of stock options 171 5
Proceeds from reverse recapitalization and PIPE financing, net 235,940 —
Proceeds from exercise of warrants 7,855 —
Payment of transaction costs related to reverse recapitalization (20,651) (3,592)
Payment of taxes related to net settlement of equity awards (5,482) —
Repayment of debt — (765)
Payment of finance lease obligations (62) (53)
Proceeds from Series B-1 preferred stock, net of issuance costs — 15,295
Proceeds from Series C preferred stock, net of issuance costs — 105,373
Proceeds from issue of shares, net of issuance costs — 116
Net cash provided by financing activities 217,771 116,379
Effect of exchange rate changes on cash, cash equivalents, and restricted cash (49) 1,931
Net increase in cash, cash equivalents, and restricted cash 181,057 95,074
Cash, cash equivalents, and restricted cash – beginning of the period 105,125 10,051
Cash, cash equivalents, and restricted cash – end of the period 286,182 105,125
Less: Restricted cash at end of period 83,145 —
Cash and cash equivalents - end of period $ 203,037 $ 105,125
ENERGY VAULT HOLDINGS, INC.
Consolidated Statements of Cash Flows (Continued)
(In thousands)
Year Ended December 31,
2022 2021
Supplemental Disclosures of Cash Flow Information:
Income taxes paid 3 1
Cash paid for interest 2 70
Supplemental Disclosures of Non-Cash Investing and Financing Information:
Conversion of redeemable preferred stock into common stock in connection with the reverse recapitalization 182,709 —
Warrants assumed as part of reverse recapitalization 19,838 —
Actuarial gain (loss) on pension (188) 166
Property, plant and equipment financed through accounts payable — 39
Assets acquired on finance lease 37 44
Reclassification of inventory costs to property and equipment, net — 11,156
Merger related costs in accounts payable — 529

The accompanying notes are an integral part of ~~the~~these consolidated financial statements.

~~F-6~~

Table of Contents

ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

NOTE 1. ORGANIZATION AND DESCRIPTION OF ~~ORGANIZATION AND~~ BUSINESS ~~OPERATIONS~~

Energy Vault Holdings, Inc., which together with its subsidiaries is referred to herein as “Energy Vault” or the “Company”, is a grid-scale energy storage company that is driving a faster transition to renewable power by solving the intermittence issues that are inherent to the most prevalent sources of renewable energy, solar and wind. The Company’s mission is to provide energy storage solutions to accelerate the global transition to renewable energy.

The Company’s project delivery generally relies on third-party EPC firms to construct our storage systems, under our supervision with dedicated teams tasked with project management. Our current business model options include:

•Building, operating, and transferring energy storage projects to potential customers,

•Building, operating, and holding energy storage systems as equity (co-) sponsor that may provide recurring revenue in the future,

•Recurring software revenue through licensing software for asset management and use case applications,

•Recurring service revenue through long term service agreements, and

•Intellectual property licenses and royalties associated with our energy storage technologies that may provide recurring revenues in the future.

The Company’s subsidiary, Energy Vault SA, was formed in December 2017 in Lugano Switzerland to the CDU, and serves as the Company’s research and development hub, and operates as the Company’s international headquarters.

Energy Vault was originally incorporated under the name Novus Capital Corporation II ~~(the “Company”) is~~as a ~~blank check~~special purpose acquisition company ~~incorporated~~ in the state of Delaware onin September ~~29, 2020. The Company was formed for~~2020 with the purpose of ~~effectuating~~effecting a merger ~~capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination~~ with 1one or more ~~businesses (the “Business Combination”).~~

~~The Company has one wholly owned subsidiary which was formed on September 2, 2021, NCCII Merger Corp. (the “Merger Sub”), a Delaware corporation.~~

The Company is an early stage and emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies. The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination although it intends to focus on target businesses that are at the forefront of high technology and are enabling the future evolution of smart technologies, 5G communication, virtual reality, artificial intelligence, spatial computing, cloud analytics, machine learning, hardware and software distribution, value added customized logistics services, sustainable smart city systems and sustainable agricultural technology, or AgTech.

As of December 31, 2021, the Company had not commenced any operations. All activity from inception through December 31, 2021 related to the Company’s formation and the initial public offering (the “Initial Public Offering”) and its search for a target business for a Business Combination, which is described below. The Company will not generate any operating revenues until after the completion of its initial Business Combination, at the earliest. The Company generates non-operating income on cash and cash equivalents in the form of interest income from the proceeds derived from the Initial Public Offering.businesses. On September 8, 2021, Novus announced that it had entered into the ~~Company,~~ Merger ~~Sub and~~Agreement with Legacy Energy Vault ~~Inc (“Energy Vault”) entered into a business combination agreement relating to a proposed business combination with (see Note 6).~~

The registration statement for the Company’s Initial Public Offering was declared effective on February 3, 2021. On February 8, 2021, the Company consummated the Initial Public Offering of 28,750,000 units (the “Units” and, with respect to the shares of Class A common stock includedthat would result in the Units sold, the “Public Shares”), which includes the full exercise by the underwriter of its over-allotment option in the amount of 3,750,000 Units, at $10.00 per Unit, generating gross proceeds of $287,500,000, which is described in Note 3.

~~Simultaneously with~~Merger. Upon the closing of the Initial Public Offering, the Company consummated the sale of 5,166,666 warrants (each, a “Private Placement Warrant” and, collectively, the “Private Placement Warrants”) at a price of $1.50 per Private Placement Warrant in a private placement to the Company’s initial stockholders, including Cowen Investments (an affiliate of one of the underwriters), generating gross proceeds of $7,750,000, which is described in Note 4.

~~Transaction costs amounted to $6,224,714, consisting of $5,750,000 of underwriting fees, and $474,714 of other offering costs.~~

~~Following the closing of the Initial Public Offering~~Merger on February ~~8, 2021, $287,500,000 ($10.00 per Public Unit) from the net proceeds of the sale of the Public Units in the Initial Public Offering~~11, 2022 (the “Closing”), Novus was immediately renamed to “Energy Vault Holdings, Inc.” The Merger between Novus and ~~the sale of the Private Placement Warrants~~Legacy Energy Vault was placed in a trust account (the “Trust Account”), and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended investment company that holds itself outaccounted for as a money market fund meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company’s stockholders, as described below, except that interest earned on the Trust Account can be released to the Company to pay its tax obligations (“permitted withdrawals”).

White the Company’s management has broad discretion with respect to the specific application of cash held outside of the Trust Account, substantially all of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, which are placed in the Trust Account, are intended to be applied generally toward completing a Business Combination. The Company’s Business Combination must be with 1 orreverse recapitalization. See Note 3 - Reverse Capitalization for more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (as defined below) (excluding taxes payable on interest earned on the Trust Account) at the time of the signing a definitive agreement to enter a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling

~~F-7~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.

The Company will provide its stockholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a stockholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek stockholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The public stockholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially anticipated to be $10.00 per Public Share, plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.

The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 either prior to or upon such consummation of a Business Combination and, if the Company seeks stockholder approval, a majority of the shares voted are voted in favor of the Business Combination. If a stockholder vote is not required by law and the Company does not decide to hold a stockholder vote for business or other reasons, the Company will, pursuant to its Amended and Restated Certificate of Incorporation (the “Amended and Restated Certificate of Incorporation”), conduct the redemptions pursuant to the tender offer rules of the U.S. Securities and Exchange Commission (“SEC”) and file tender offer documents with the SEC prior to completing a Business Combination. If, however, stockholder approval of the transaction is required by law, or the Company decides to obtain stockholder approval for business or other reasons, the Company will offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If the Company seeks stockholder approval in connection with a Business Combination, the initial stockholders and Cowen Investments have agreed to vote their Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each public stockholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against the proposed Business Combination.

The initial stockholders and Cowen Investments have agreed (a) to waive their redemption rights with respect to their Founder Shares and Public Shares held by them in connection with the completion of a Business Combination, (b) to waive their liquidation rights with respect to the Founder Shares if the Company fails to complete a Business Combination within by February 8, 2023 and (c) not to propose an amendment to the Amended and Restated Certificate of Incorporation (i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of its Public Shares if the Company does not complete a Business Combination or (ii) with respect to any other provision relating to stockholders’ rights or pre-initial business combination activity, unless the Company provides the public stockholders with the opportunity to redeem their Public Shares in conjunction with any such amendment. However, if the initial stockholders and Cowen Investments acquire Public Shares in or after the Initial Public Offering, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period.

The Company has until February 8, 2023 to complete a Business Combination (the “Combination Period”). If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ~~ten~~ business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account including interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate, subject in each case to the Company’s obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period.

In order to protect the amounts held in the Trust Account, V Donargo LLC, an entity controlled by Vincent Donargo, the Company’s Chief Financial Officer, has agreed to be liable to the Company if and to the extent any claims by a third party for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.00 per Public Share or (2) the actual amount per Public

~~F-8~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay our taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, V Donargo LLC will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that V Donargo LLC will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (except the Company’s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

~~On September 8, 2021, the Company, Merger Sub and~~information. Energy Vault ~~entered into~~Holdings, Inc. is headquartered in Los Angeles, California.

Throughout the ~~Business Combination Agreement, pursuant~~notes to which Novus and Energy Vault will consummate the Business Combination. The Business Combination Agreement contains customary representations and warranties, covenants, closing conditions, termination fee provisions and other terms relating to the Merger and the other transactions contemplated thereby (Note 6).

~~Risks and Uncertainties~~

Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of the consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

~~Going Concern~~

As of December 31, 2021, the Company had $396,295 in its operating bank accounts and working capital of $317,788. As of December 31, 2021, $15,823 of the amount on deposit in the Trust Account represented interest income, which is available to be withdrawn to pay taxes.

Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination.

The Company will need to raise additional funds through loans or additional investments from its Sponsor, stockholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for at least one year from the date that the consolidated financial statements, ~~are issued. These consolidated financial statements do not include any adjustments relating~~unless otherwise noted, the “Company,” “we,” “us,” or “our” and similar terms refer to Legacy Energy Vault and its subsidiaries prior to the ~~recovery~~consummation of the ~~recorded assets or~~Merger, and Energy Vault and its subsidiaries after the ~~classification~~consummation of the ~~liabilities that might be necessary should the Company be unable to continue as a going concern.~~

Merger.

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial ~~statement is presented~~statements have been prepared on an accrual basis of accounting in ~~conformity~~accordance with ~~accounting principles generally accepted in the United States of America (“GAAP”)~~GAAP and ~~pursuant to the~~applicable rules and regulations of the ~~SEC.~~

SEC regarding financial reporting.

~~F-9~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

Principles of Consolidation

~~The accompanying~~

These consolidated financial statements include ~~the accounts of the Company~~Energy Vault Holdings, Inc. and its wholly owned ~~subsidiary.~~subsidiaries. All ~~significant~~ intercompany balances and transactions have been eliminated in consolidation.

If the Company has a variable interest in an entity, an assessment is performed to determine if that entity is a variable interest entity (“VIE”), and if so, if the Company is the primary beneficiary of the VIE. The assessment of whether an entity is a VIE requires an evaluation of qualitative factors and, where applicable, quantitative factors. These factors include: (i) determining whether the entity has sufficient equity at risk, (ii) evaluating whether the equity holders, as a group, lack the ability to make decisions that significantly affect the economic performance of the entity, and (iii) determining whether the entity is structured with disproportionate voting rights in relation to their equity interests. The Company has determined that it is not the primary beneficiary of any VIEs in which it has a variable interest.

Emerging Growth Company

~~The Company is an “emerging growth company,” as defined in~~

Section ~~2(a)~~102(b)(1) of ~~the Securities Act, as modified by~~ the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

~~Further, Section 102(b)(1) of the JOBS Act~~ exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that

Table of Contents

ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that aan emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised, and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard.

This may make comparison of the Company’s consolidated financial ~~statements~~statement with another public company ~~which~~that is neither an emerging growth company nor an emerging growth company ~~which~~that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of Estimates

The preparation of the consolidated financial statements, in conformity with ~~U.S.~~ GAAP requires ~~the Company’s~~ management to make estimates and assumptions that affect the amounts reported ~~amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of~~in the consolidated financial statements and accompanying notes. The Company evaluates its assumptions on an ongoing basis. The Company’s management believes that the ~~reported amounts~~estimates, judgment, and assumptions used are reasonable based upon information available at the time they are made. Significant estimates made by management include, among others, revenue recognition, stock-based compensation, and valuation of ~~expenses~~warrant liability. Due to the inherent uncertainty involved in making assumptions and estimates, changes in circumstances could result in actual results differing from those estimates, and such differences could be material to the Company’s consolidated financial condition and results of operations.

Segment Reporting

The Company reports its operating results and financial information in one operating and reportable segment. Our chief operating decision maker, which is our chief executive officer, reviews our operating results on a consolidated basis and uses that consolidated financial information to make operating decisions, assess financial performance, and allocate resources.

Concentration of Credit Risk

Financial instruments that subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, accounts receivable, and customer financings receivable.

Risks associated with cash and cash equivalents and restricted cash are mitigated by banking with creditworthy institutions. Such balances with any one institution may, at times, be in excess of federally insured amounts.

As of December 31, 2022, two customers had trade receivable balances exceeding 10% of total accounts receivable. These customers accounted for 78% and 16% of total accounts receivable, respectively.

As of December 31, 2022, one customer accounted for 100% of the customer financing receivable.

For the year ended December 31, 2022, revenue from two different customers accounted for 57% and 35% of total revenue, respectively.

Foreign Currency

Assets and liabilities denominated in a foreign currency are translated into U.S dollars using the exchange rates in effect at the balance sheet date. Revenue and expense accounts are translated at the average exchange rates during the ~~reporting period.~~

~~Making estimates requires management~~periods. The impact of exchange rate fluctuations from translation of assets and liabilities is included in accumulated other comprehensive loss, a component of stockholders’ equity (deficit). As of December 31, 2022, accumulated other comprehensive loss included a $0.2 million loss related to ~~exercise significant judgment. It is~~currency translation adjustments. As of December 31, 2021, accumulated other comprehensive loss included a $44 thousand gain related to currency translation adjustments.

Gains and losses resulting from foreign currency transactions are included in other income (expense), net in the accompanying consolidated statements of operations.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Fair Value Measurements

ASC 820, Fair Value Measurement (“ASC 820”), establishes a fair value hierarchy for instruments measured at ~~least reasonably possible~~fair value that distinguishes between assumptions based on market data (observable inputs) and the ~~estimate~~Company’s own assumptions (unobservable inputs). Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the ~~effect of~~Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. Fair value is defined as the price that would be received to sell an asset or paid to transfer a ~~condition, situation or set of circumstances that existed~~liability (an exit price) in an orderly transaction between market participants at the ~~date~~reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows:

Level I — Inputs which include quoted prices in active markets for identical assets and liabilities.

Level II — Inputs other than Level I that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the ~~consolidated financial statements,~~assets or liabilities.

Level III — Unobservable inputs in which ~~management considered~~there is little or no market data, which require the reporting entity to develop its own assumptions.

Revenue Recognition

The Company recognizes revenue from contracts with customers in ~~formulating its estimate, could change~~accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, revenue is recognized when, or as, control of promised goods and services is transferred to customers, and the amount of revenue recognized reflects the consideration to which the Company expects to be entitled in exchange for the goods and services transferred. The Company determines revenue recognition through the following steps:

(1)Identification of the contract, or contracts, with a customer.

(2)Identification of the performance obligations in the ~~near term due to one or more future confirming events. One~~contract.

(3)Determination of the ~~more significant accounting estimates included~~transaction price.

(4)Allocation of the transaction price to the performance obligations in the contract.

(5)Recognition of revenue when, or as, a performance obligation is satisfied.

Once a contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations. Arrangements that include rights to additional goods or services that are exercisable at a customer’s discretion are generally considered options. The Company assesses if these ~~consolidated financial statements is~~options provide a material right to the customer and if so, they are considered performance obligations. The identification of material rights requires judgments related to the determination of the ~~fair~~ value of the ~~warrant liabilities. Such~~underlying good or service relative to the option exercise price.

The Company assesses whether each promised good or service is distinct for the purposes of identifying performance obligations in the contract. This assessment involves subjective determination and requires management to make judgments about the individual promised goods or services and whether such are separable from the other aspects of the contractual relationship. Promised goods and services are considered to be distinct provided that: (i) the customer can benefit from the good or service either on its own or together with the other resources that are readily available to the customer (that is, the good or service is capable of being distinct) and (ii) the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (that is, the promise to transfer the good or service is distinct within the context of the contract). The Company also considers the intended benefit of the contract in assessing whether a promised good or service is separately identifiable from other promises in the contract. If a promised good or service is not distinct, an entity is required to combine that good or service with other promised goods or services until it identifies a bundle of goods or services that is distinct.

The transaction price is determined and allocated to the identified performance obligations in proportion to their stand-alone selling prices (“SSP”) on a relative SSP basis. SSP is determined at contract inception and is not updated to reflect

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

changes between contract inception and when the performance obligations are satisfied. Determining the SSP for performance obligations requires significant judgment. In developing the SSP for a performance obligation, the Company considers applicable market conditions and relevant entity-specific factors, including factors that were contemplated in negotiating the agreement with the customer and estimated costs.

In determining the transaction price, the Company adjusts consideration for the effects of the time value of money if the timing of payments provides the Company with a significant benefit of financing. When a contract provides the customer with a significant benefit of financing, the Company recognizes a customer financing receivable and recognizes interest income separate from the revenue recognized on the contracts with customers. The Company does not assess whether a contract has a significant financing component if the expectation at contract inception is such that the period between payment and the transfer of the promised goods or services will be one year or less.

The Company recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) each performance obligation is satisfied, either at a point in time or over time. Over time revenue recognition is based on the use of an output or input method.

Build and Transfer Energy Storage Projects: The Company enters into contracts with utility companies and independent power producers to build and transfer energy storage projects. The Company has entered into contracts to build and transfer battery-based energy storage projects and intends to enter into contracts to build and transfer gravity-based energy storage projects in the future. Each storage project is customized depending on the customer’s energy needs. Customer payments are due upon meeting certain milestones that are consistent with contract-specific phases of a project. The Company determines the transaction price based on the consideration expected to be received, which includes estimates of liquidated damages or other variable consideration. Generally, each contract to design and construct an energy storage project contains one performance obligation. Multiple contracts entered into with the same customer and near the same time to construct energy storage projects are combined in accordance with ASC 606. In these situations, the contract prices are aggregated and then allocated to each energy storage project based upon their relative stand-alone selling price.

Revenue for these performance obligations is recognized using the percentage of completion method based on cost incurred as a percentage of total estimated contract costs. Contract costs include all direct materials and labor costs related to contract performance. Pre-contract costs with no future benefit are expensed in the period in which they are incurred. Since the revenue recognition of these contracts depends on estimates, which are assessed continually during the term of the contract, recognized revenues and profit are subject to revisions as the contract progresses to completion. The cumulative effects of revisions of estimated total contract costs and revenues, together with any contract reserves which may be deemed appropriate, are recorded in the period in which the facts and changes in circumstances become known. Due to uncertainties inherent in the estimation process, it is reasonably possible that these estimates will be revised in a different period. When a loss is forecasted for a contract, the full amount of the anticipated loss is recognized in the period in which it is determined that a loss will incur.

The Company’s contracts generally provide customers the right to liquidated damages (“LDs”) against Energy Vault in the event specified milestones are not met on time, or certain performance metrics are not met upon or after the substantial completion date. LDs are accounted for as variable consideration, and the contract price is reduced by the expected penalty or LD amount when recognizing revenue. Variable consideration is included in the transaction price only to the extent that it is improbable that a significant reversal in the amount of cumulative revenue recognized will occur when the uncertainty is resolved. Estimating variable consideration requires certain estimates and assumptions, including whether and by how much a project will be delayed. The existence and measurement of liquidated damages may also be impacted by the Company’s judgment about the probability of favorable outcomes of customer disputes involving whether certain events qualify as force majeure or the reason for the events that caused project delays. Variable consideration for LDs is estimated using the expected value of the consideration to be received. If Energy Vault has a claim against the customer for an amount not specified in the contract, such claim is recognized as an increase to the contract price when it is legally enforceable, which is usually upon signing a respective change order or equivalent document confirming the claim acceptance by the customer.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The Company offers limited warranties on the Company’s energy storage systems which provide the customer assurance that the energy storage systems will function as the parties intended because it complies with agreed-upon specifications and are free from defects. These assurance-type warranties are not treated as a separate revenue performance obligation and are accounted for as guarantees under GAAP.

Operate Energy Storage Projects:To date, the Company has not recognized any revenue related to providing operation services for its energy storage projects. The method of revenue recognition will be determined once the Company finalizes agreements with its future customers.

Energy Management Software as a Service and Long Term Service Arrangements:To date, the Company has not recognized any revenue related to providing energy management software as a service or related to long term service arrangements. The method of revenue recognition will be determined once the Company finalizes agreements with its future customers.

Intellectual Property Licensing:The Company enters into licensing agreements of its intellectual property that are within the scope of ASC 606. The terms of such licensing agreements include the license of functional intellectual property, given the functionality of the intellectual property is not expected to change substantially as a result of the licensor’s ongoing activities. The transaction price allocated to the licensing of intellectual property is recognized as revenue at a point in time when the licensed intellectual property is made available for the customer’s use and benefit. Certain licensing agreements contain a significant financing component due to the customer having extended payment terms. The amounts due from customers under extended payment terms are included in the line item, customer financing receivable, on the consolidated balance sheets.

One of the Company’s intellectual property licensing customers is Atlas, which was an investor in the Company’s PIPE. As part of the Company’s licensing agreement with Atlas, the Company agreed to provide Atlas with a final update to its functional intellectual property upon the completion of the Company’s research and development activities related to the intellectual property that was previously provided to Atlas. The Company identified the obligation to provide this update to Atlas as a performance obligation and deferred $5.9 million of the transaction price related to this performance obligation during the first quarter of 2022. This deferred amount was recognized as revenue during the fourth quarter of 2022 upon the Company transferring the technology update to Atlas.

The contract with Atlas includes variable consideration of $25.0 million due to the Company’s commitment to provide a $25.0 million refundable contribution to Atlas during the construction period of Atlas’ first project. The Company has considered this to be variable consideration as the Company will be repaid when Atlas’ first project reaches substantial completion, subject to ~~change~~adjustment for potential liquidated damages if certain performance metrics are not met. The Company has determined that it is probable that Atlas will reach substantial completion and meet the performance metrics to repay Energy Vault, therefore the entire amount of variable consideration has been included in the transaction price. As of December 31, 2022, the Company has contributed all $25.0 million to Atlas. The $25.0 million refundable contribution is included in the line item, contract assets, on the consolidated balance sheets.

Royalty Revenue:In connection with entering into intellectual property licensing agreements, the Company also enters into royalty agreements whereby the customer agrees to pay the Company a percentage of the customer’s future sales revenue that is generated by using the Company’s intellectual property. The Company has not recognized any royalty revenue to date, but will recognize royalty revenue at the point in time when the customer’s sales occur.

Other Revenue:In connection with entering into the intellectual property licensing agreement with Atlas, the Company agreed to provide construction support services to Atlas during the periods in which they construct energy storage projects. Energy Vault is reimbursed by Atlas at the Company’s cost to provide these services. Because the construction support services were considered to be an option that provided a material right for the customer to obtain services from the Company, this obligation was considered to be a performance obligation and required an allocation of the transaction price. The transaction price allocated to construction support services and deferred at the inception of the contract was $1.2 million. This amount is recognized as ~~more current information becomes available~~revenue over time using the cost-to-cost measure of progress as that method offers the best depiction of the continuous transfer of services to the customer.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Cash, Cash Equivalents, and ~~accordingly, the actual results could differ significantly from those estimates.~~

Restricted Cash ~~and Cash Equivalents~~

The Company considers all ~~short-term~~highly liquid investments purchased with an original or remaining maturity of three months or less ~~when purchased~~ to be cash equivalents. ~~The~~At December 31, 2022 and 2021, the Company ~~did not have any~~maintained money market accounts totaling $5.4 million and $5.3 million respectively; and a cash ~~equivalents~~sweep account invested primarily in US Treasury and other short term securities totaling $66.5 million and $84.2 million, respectively.

Restricted cash as of December 31, ~~2021~~2022 primarily consisted of cash held by banks as collateral for the Company’s letters of credit.

Accounts Receivable

Accounts receivable represents amounts that have an unconditional right to consideration, have been billed to customers, and ~~2020.~~

~~Marketable Securities Held in Trust Account~~

Atdo not bear interest. Receivables are carried at amortized cost. The Company periodically assesses collectability of its receivables from each customer and records an allowance for doubtful accounts for the estimated uncollectible amount when deemed appropriate. If circumstances related to specific customers change, the Company’s estimates of the recoverability of receivables could be adjusted. Accounts are written off after all means of collection, including legal action, have been exhausted. As of both December 31, 2022 and December 31, 2021, no allowance for doubtful accounts has been recorded.

Customer Financing Receivable

Customer financing receivable includes amounts due from a customer related to a licensing agreement under extended payment terms which contains a significant financing component. An interest rate is not stated in this agreement and ~~2020, substantially all of~~is imputed using the assets held in the Trust Account were held in money market funds which are invested primarily in U.S. Treasury securities. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presentedeffective interest method when recognizing interest income. The imputed interest rate on the ~~consolidated balance sheet at fair value at~~note is 8.9%. Interest income on the ~~end of each reporting period. Gains~~customer financing receivable was $35 thousand for the year ended December 31, 2022 and ~~losses resulting from~~was recognized within the change in fair value of investments held in Trust Account are included in interest earned on marketable securities held in Trust Account in the accompanying statements of operations. The estimated fair values of investments held in Trust Account are determined using available market information.

~~F-10~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~Offering Costs~~

~~Offering costs consisted of legal, accounting and~~line item, other expenses incurred through the Initial Public Offering that were directly related to the Initial Public Offering. Offering costs were allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Offering costs allocated to warrant liabilities were expensed as incurredincome (expense), net in the consolidated statements of operations. ~~Offering~~As of December 31, 2022, no allowance for doubtful accounts has been recorded for customer financing receivable.

Inventory

Inventory consists of inverters and spare parts, which are used in ongoing battery storage projects for sale. Inventory is stated at the lower of cost or net realizable value with cost being determined by the specific identification method. Costs include the cost of purchase and other costs ~~associated with~~incurred in bringing the ~~Class A common stock issued were~~inventories to their present location and condition. The Company periodically reviews its inventory for potential obsolescence and write down of its inventory, as appropriate, to net realizable value based on its assessment of market conditions.

Property and Equipment, Net

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the respective assets. Maintenance and repairs are charged to ~~temporary equity. Offering costs amounted to $6,224,714, of which $5,983,403 were charged against temporary equity~~expense as incurred. When assets are retired or sold, the cost and ~~$241,311 were expensed on~~related accumulated depreciation are removed from the consolidated ~~statement~~balance sheet and any resulting gain or loss is reflected in operating expenses in the period realized.

Impairment of ~~operations.~~

~~Class A Common Stock Subject to Possible Redemption~~

Long-Lived Assets

The Company ~~accounts~~reviews long-lived assets, primarily comprised of property and equipment and operating right-of-use assets, for ~~its Class A common stock subject to possible redemption~~impairment whenever events or changes in ~~accordance with~~circumstances indicate that the ~~guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Shares~~carrying amount of ~~Class A common stock subject to mandatory redemption is classified as a liability instrument and~~an asset may not be recoverable. Recoverability is measured ~~at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that is either within the control~~by comparison of the ~~holder or subject~~carrying amount to ~~redemption upon~~ the ~~occurrence of uncertain events not solely within~~future undiscounted net cash flows which the Company’s control) is classified as temporary equity. At all other times, common stock is classified as stockholders’ equity. The Company’s Class A common stock features certain redemption rights thatassets are ~~considered~~expected to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021, Class A common stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of the Company’s consolidated balance sheet.

~~The Company recognizes changes in redemption value immediately as they occur and adjusts~~generate. If the carrying value of ~~redeemable common stock~~the assets exceeds the sum of the estimated future cash flows, the impairment to ~~equal~~be recognized is measured as the ~~redemption~~amount by which the carrying amount of the assets exceed their fair value.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Investment in Equity Securities

During 2022, the Company made a strategic investment and purchased equity securities of a private company active in the energy transition industry. These equity securities do not have a readily determinable fair value and are recorded at cost, less any impairment, plus or minus adjustments related to observable transactions for the same or similar securities, with unrealized gains and losses included in earnings. As of December 31, 2022, both the cost basis and carrying value of these equity securities was $9.0 million. The Company did not recognize any impairments or value changes resulting from observable price changes during the year ended December 31, 2022. The carrying value of the Company’s investment in equity securities is included in the line item, other assets, in the consolidated balance sheets.

Leases

The Company determines if a contract contains a lease at its inception based on whether or not the Company has the right to control the asset during the contract period and other facts and circumstances. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

ROU assets are classified as either operating or finance leases. Upon commencement of the lease, a ROU asset and corresponding lease liability are recognized for all operating and finance leases. The Company has elected the short-term lease exemption, which does not require a ROU asset or lease liability to be recognized when the lease term is 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. The Company has decided not to elect the policy to not separate lease and non-lease component in arrangements whereby the Company is the lessee.

Upon commencement of the lease, ROU assets are recognized based on the initial measurement of the lease liability and adjusted for any lease payments made before commencement date of the lease, less any lease incentives and including any initial direct costs incurred. Lease liabilities are initially measured at the present value of future minimum lease payments over the lease term.

The discount rate used to determine the present value is the rate implicit in the lease unless that rate cannot be determined, in which case Company’s incremental borrowing rate is used, which is based on the estimated interest rate for collateralized borrowing over a similar term of the lease at commencement date.

Rights to extend or terminate a lease are included in the lease term when there is reasonable certainty the right will be exercised. Factors used to assess reasonable certainty of rights to extend or terminate a lease include current and forecasted lease improvement plans, anticipated changes in development strategies, historical practice in extending similar contracts and current market conditions.

Operating lease ROU assets and liabilities are subsequently measured at the present value of the lease payments not yet paid and discounted at the initial discount rate at commencement of the lease, less any impairments to the ROU asset. Operating lease expense is recognized on a straight-line basis over the lease term. Finance lease ROU assets are amortized on a straight-line basis over the estimated useful life of the asset if the lessee is reasonably certain to exercise a purchase option or ownership of the leased asset transfers at the end of ~~each reporting period. Increases~~ the lease term, otherwise the leased assets are amortized over the lease term. Amortization of finance lease ROU assets is included in depreciation and amortization.

Operating lease ROU assets are recognized on the consolidated balance sheets in the line item, operating lease right-of-use assets, and finance lease ROU assets are recognized on the consolidated balance sheets within the line item, property and equipment, net.

Asset Retirement Obligation

Asset retirement obligations (AROs) are legal obligations associated with the retirement of tangible long-lived assets resulting from acquisition, construction, development, and/or ~~decreases~~normal use of the underlying assets. The ARO is recognized at its estimated fair value in the period in which it is incurred. These obligations generally include the estimated net future costs of dismantling the assets and restoring the land the assets are located on to its original condition in accordance with legal regulations and land lease agreement requirements. Upon initial recognition of a liability, the associated asset retirement costs are capitalized as part of the related long-lived asset and depreciated over the estimated useful life of the related asset. The liability is accreted over time through charges to earnings. If an ARO is settled for an amount other than

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

the carrying amount of ~~redeemable common stock~~the liability, the Company recognizes a gain or loss on the settlement. The Company reviews its AROs on an ongoing basis.

Defined Benefit Pension Obligation

The Company’s wholly owned subsidiary in Switzerland has a defined benefit pension obligation covering retirement and other long-term benefits of the local employees. Accrued pension costs are ~~affected by charges against additional paid~~developed using actuarial principles and assumptions which consider a number of factors, including estimates for the discount rate, expected long-term rate of return on assets and mortality. Changes in ~~capital and accumulated deficit.~~

~~At December 31, 2021,~~these estimates would impact the ~~Class A common stock reflected~~amounts that the Company records in the consolidated ~~balance sheet are reconciled in~~financial statements.

Warrants

The Company assumed Public Warrants and Private Warrants upon the ~~following table:~~

Gross proceeds

$
287,500,000
Less:


Proceeds allocated to Public Warrants

$
(10,733,333)
Issuance costs allocated to Class A common stock

(5,983,403)
Plus:


Remeasurement adjustment on redeemable common stock

$
16,716,736

Class A common stock subject to possible redemption

$
287,500,000

~~Warrant Liabilities~~

Closing. The Company accounts for warrants ~~as either equity-classified or liability-classified instruments based on an assessment~~for shares of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”).Company’s common stock that are not indexed to its own stock as liabilities at fair value on the consolidated balance sheets. The ~~assessment considers whether the~~ warrants are ~~freestanding financial instruments pursuant~~subject to ~~ASC 480, meet the definition of a liability pursuant to ASC 480,~~remeasurement at each balance sheet date and ~~whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to~~any change in fair value is recognized in the Company’s ~~own common stock, among other conditions for equity classification. This assessment is conducted at the time~~consolidated statements of ~~warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.~~

operations. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional ~~paid-in capital~~paid-in-capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as a liability at their initial fair value on the date of issuance, and each ~~consolidated~~

~~F-11~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss onin the consolidated statements of operations.

Earn-Out Shares

In connection with the reverse recapitalization and pursuant to the Merger Agreement, eligible Legacy Energy Vault stockholders immediately prior to the Closing, have the contingent right to receive an aggregate of 9.0 million shares of the Company’s common stock (“Earn-Out Shares”) upon the Company achieving each Earn-Out Triggering Event (defined below) during the period beginning on the 90th day following the Closing and ending on the third anniversary of such date. An “Earn-Out Triggering Event” means the date on which the closing price of the Company’s common stock quoted on the NYSE is greater than or equal to certain specified prices for any 20 trading days within a 30 consecutive day trading period.

The Earn-Out Shares were recognized at fair value upon the Closing of the Merger and classified in shareholders’ equity. Because the Merger was accounted for as a reverse recapitalization, the issuance of the Earn-Out Shares was treated as a deemed dividend and since the Company does not have retained earnings, the issuance was recorded within additional-paid-in capital (“APIC”) and has a net nil impact on APIC.

Research and Development Expenses

Research and development costs are expensed as incurred. Research and development costs consist of salaries and other personnel related expenses, engineering expenses, product development costs and facility costs.

Advertising Costs

Advertising costs are expensed as incurred and are reflected in the line item, sales and marketing, in the consolidated statements of operations. Advertising expenses were $0.3 million for the year ended December 31, 2022. The Company did not incur any advertising expenses during the year ended December 31, 2021.

Stock-Based Compensation

The Company issues stock-based compensation awards to employees, directors, and non-employees in the form of stock options and restricted stock units (“RSUs”). The Company measures and recognizes compensation expense for stock-based awards based on the award’s fair value on the date of the grant. The Company accounts for forfeitures of stock-based awards when they occur. The fair value of RSUs that vest based on service conditions is measured using the ~~Public Warrants~~fair value of the Company’s common stock on the date of the grant. The fair value of RSUs that vest based on market conditions is measured using a Monte Carlo simulation model on the date of the grant. The fair value of stock options that vest based on service conditions is measured using the Black-Scholes option pricing model on the date of the grant. The Monte Carlo simulation model and ~~Private Placement Warrants (together~~the Black-Scholes option pricing model require the input of highly subjective assumptions, including

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

the fair value of the Company’s common stock, the expected term of the award, the expected volatility of the Company’s common stock, risk-free interest rates, and the expected dividend yield of the Company’s common stock. This assumption used to determine the fair value of the awards represent management’s best estimates. These estimates involve inherit uncertainties and the application of management’s judgment.

The fair value of awards are recognized on a straight-line basis over the requisite service period. The fair value of the market-based RSUs is recognized over the requisite service period regardless of whether or not the RSUs ultimately vest and convert to common stock.

Transaction Costs

Transaction costs consist of direct legal, accounting, and other fees related to the consummation of the Merger. These costs were initially capitalized as incurred in prepaid assets and other current assets in the consolidated balance sheet. Upon the Closing, transaction costs related to the issuance of shares were recognized in stockholders’ deficit while costs associated with the ~~Public Warrants,~~public and private warrants liabilities were expensed in the ~~“Warrants”)~~consolidated statements of operations and comprehensive loss. As of December 31, 2021, $4.1 million of deferred Merger transaction costs were included within prepaid and other current assets in the consolidated balance sheet. The Company and Novus incurred in aggregate $44.8 million in transaction costs, consisting of underwriting, legal, and other professional fees, of which $24.2 million was recorded to additional paid-in-capital as a reduction of proceeds and the remaining $20.6 million was expensed immediately upon the Closing.

Income Taxes

The Company accounts for income taxes in accordance with ~~the guidance contained in~~ ASC 815-40. The Warrants are not considered indexed to the Company’s own common stock, and as such, the Warrants do not meet the criteria for equity treatment and must be recorded as liabilities. The Private Placement Warrants and the Public Warrants for periods where no observable traded price was available were valued using the Modified Monte Carlo Simulation and Modified Black Scholes option pricing models (see Note 9).

740, Income Taxes

~~The Company complies with~~ (“ASC 740”). ASC 740 prescribes the ~~accounting and reporting requirements~~use of ~~ASC Topic 740, “Income Taxes,” which requires an~~the liability method, whereby deferred tax asset and liability ~~approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities~~account balances are ~~computed for~~determined based on differences between ~~the consolidated~~ financial ~~statement~~reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that will ~~result~~be in ~~future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which~~effect when the differences are expected to ~~affect taxable income. Valuation allowances~~reverse.

Deferred income tax balances reflect the effects of temporary differences between the carrying amounts of assets and liabilities and their tax bases and are ~~established, when necessary, to reduce deferred~~stated at enacted tax ~~assets to the amount~~rates expected to be ~~realized.~~

~~ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the consolidated financial statement recognition and measurement of tax positions taken~~in effect when taxes are actually paid or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were 0 unrecognized tax benefits and 0 amounts accrued for interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception. The Company’s effective tax rates for the periods presented differ from the expected (statutory) rates due to non-deductible transaction costs and changes in fair value of warrants, the recording of full valuation allowances on deferredrecovered. Deferred tax assets are evaluated for future realization and ~~permanent differences.~~

reduced by a valuation allowance to the extent the Company believes they will not be realized.

Net Loss Per ~~Common~~ Share

~~The Company complies with accounting and disclosure requirements~~

Basic net loss per share of ~~FASB ASC Topic 260, “Earnings Per Share”. Net income (loss) per~~ common stock is ~~computed~~calculated by dividing net ~~income (loss)~~loss by the weighted average number of common ~~stock~~shares outstanding for the ~~period.. Remeasurement adjustment associated~~applicable period. Diluted net loss is computed based on the weighted average number of common shares outstanding increased by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued, including any dilutive effect from convertible preferred stock, outstanding stock options, or unvested RSUs, and reduced by the number of shares the Company could have repurchased with the ~~redeemable shares~~proceeds from the issuance of ~~Class A common stock is~~the potentially dilutive shares. Potentially dilutive instruments are excluded from ~~earnings~~the per share ~~as the redemption value approximates fair value.~~

~~The~~ calculation of diluted income (loss) per share does not consider the effect of the warrants issued in connection with the (i) Initial Public Offering, and (ii) the private placement. The warrants are exercisable to purchase 14,749,999 Class A common stock in the aggregate. As of December 31, 2021 and 2020,because the Company ~~did not have any dilutive securities or other contracts that could, potentially, be exercised or converted into common stock and then share~~is in ~~the earnings of the Company. As~~ a ~~result, diluted~~ net loss ~~per common stock is~~position and they would therefore be anti-dilutive.

Prior to 2022, the ~~same as basic net loss per common stock for~~Company followed the ~~periods presented.~~

~~The following table reflects the calculation of basic and diluted~~two-class method when computing net loss per share ~~(in dollars, except~~for periods when issued shares that meet the definition of participating securities are outstanding. The two-class method calls for the calculation of net loss per share ~~amounts):~~

for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income available to common stockholders to be allocated between common and participating securities based upon their respective rights to received dividends as if all income for the period had been distributed. Net losses are not allocated to the Company’s preferred stockholders as they do not have an obligation to share in the Company’s net losses. The two-class method is no longer applicable after the closing of the Merger.

~~F-12~~

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses. The new accounting standard will be effective for the fiscal year beginning on January 1, 2023 and will be adopted using the

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~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

For the Period from

September 29, 2020

(Inception) Through

Year Ended December 31

December 31,

2021

2020

Class A

Class B

Class A

Class B
Basic and diluted net loss per common stock








Numerator:








Allocation of net loss, as adjusted

$
(2,616,395)

$
(722,143)

$
—

$
(1,104)
Denominator:








Basic and diluted weighted average shares outstanding

25,678,082

7,087,329

—

6,250,000
Basic and diluted net loss per common stock

$
(0.10)

$
(0.10)

$
—

$
—

ENERGY VAULT HOLDINGS, INC.

~~Concentration of Credit Risk~~

Notes to Consolidated Financial ~~instruments that potentially subject the Company~~Statements

modified retrospective method, which requires a cumulative effect adjustment to ~~concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of$250,000.~~retained earnings. The Company ~~had not experienced losses~~is currently evaluating the impact this ASU will have on ~~this account~~its consolidated financial statements and ~~management believes~~expects the ~~Company is not exposed to significant risks on such account.~~

~~Fair Value of Financial Instruments~~

~~The fair value~~adoption of the ASU will reduce opening retained earnings by approximately $2.4 million (pre-tax), driven by the Company’s accounts receivables, contract assets, and liabilities, which qualify as financial instruments under ASC 820, “Fair Value Measurement,” approximates the carrying amounts represented in the consolidated balance sheets, primarily due to their short-term nature, except for warrant liabilities (see Note 9).

~~Recently Issued Accounting Standards~~

long-term financing receivable.

In August 2020, ~~the~~ FASB issued ASU No. 2020-06, ~~“Debt—~~Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and ~~Hedging—Contracts~~Hedging — in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own ~~Equity”~~Equity (“ASU 2020-06”)~~, which~~. ASU 2020-06 simplifies the accounting for convertible instruments. In addition to eliminating certain accounting models, this ASU includes improvements to the disclosures for convertible instruments ~~by removing major separation models required under current GAAP. ASU 2020-06 removes certain settlement conditions that are required for equity contracts to qualify~~and earnings-per-share (EPS) guidance and amends the guidance for the ~~derivative~~derivatives scope exception ~~and it also simplifies the diluted earnings per share calculation~~for contracts in ~~certain areas.~~an entity’s own equity. ASU 2020-06 is effective for fiscal years beginning after December 15, ~~2023, including interim periods within those fiscal years, with early adoption permitted.~~2021. The Company ~~is currently assessing the impact, if any, that~~adopted ASU 2020-06 ~~would~~on January 1, 2022 and it did not have ~~on its financial position, results of operations or cash flows.~~

~~Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect~~an impact on the Company’s consolidated financial statements.

In December 2020, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes. ASU 2019-12 is effective for nonpublic entities for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. The Company adopted ASU 2019-12 on January 1, 2022 and it did not have an impact on the Company’s consolidated financial statements.

NOTE 3. ~~INITIAL PUBLIC OFFERING~~

REVERSE RECAPITALIZATION

On February 8,11, 2022, in connection with the Merger, the Company raised gross proceeds of $235.9 million, including the contribution of $40.9 million of cash, net of redemptions, held in Novus’ trust account from its initial public offering and an aggregate purchase price of $195.0 million from the sale and issuance of common shares in a PIPE at $10.00 per share. The Company and Novus incurred in aggregate approximately $44.8 million in transaction costs, consisting of underwriting, legal, and other professional fees, of which $24.2 million was recorded to additional paid-in-capital as a reduction of proceeds and the remaining $20.6 million was expensed immediately upon the Closing. The aggregate consideration paid to Legacy Energy Vault stockholders in connection with the Merger (excluding any potential Earn-Out Shares), was 106.2 million shares of the Company’s common stock, par value $0.0001 after giving effect to the exchange ratio of 6.7735 (the “Exchange Ratio”). The total net cash proceeds to the Company were $191.1 million.

The following transactions were completed as part of the Merger:

•All of the issued and outstanding shares of Legacy Energy Vault convertible preferred stock were canceled and converted into a total of 85.7 million shares of Energy Vault common stock;

•Each issued and outstanding share of Legacy Energy Vault common stock was canceled and converted into a total of 20.4 million shares of Energy Vault common stock;

•Each outstanding vested and unvested Legacy Energy Vault common stock option was converted into options exercisable for shares of Energy Vault common stock with the same terms except for the number of shares exercisable and the exercise price, each of which was adjusted by the Exchange Ratio;

•Each outstanding and unvested Legacy Energy Vault restricted stock unit (“RSU”) was converted into RSUs for shares of Energy Vault common stock with the same terms except for the number of shares, each of which was adjusted by the Exchange Ratio; and

•Each outstanding vested and unvested Legacy Energy Vault restricted stock award (“RSA”) was converted into RSAs for shares of Energy Vault common stock with the same terms except for the number of shares, each of which was adjusted by the Exchange Ratio.

The Merger was accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, Novus was treated as the acquired company for financial reporting purposes. The reverse recapitalization accounting treatment was primarily determined based on the shareholders of Legacy Energy Vault having a relative majority of the voting power of Energy Vault and having the ability to nominate the majority of the members of the Energy Vault Board, senior management of Legacy Energy Vault comprise the senior management of Energy Vault, and the operations of Legacy Energy Vault prior to the Merger comprise the ongoing operations of Energy Vault. Accordingly, for accounting

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

purposes, the financial statements of the combined entity upon consummation of the Merger represent a continuation of the financial statements of Legacy Energy Vault with the Merger being treated as the equivalent of Legacy Energy Vault issuing shares for the net assets of Novus, accompanied by a recapitalization. The net assets of Novus were recognized at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Merger are presented as those of Legacy Energy Vault and the accumulated deficit of Legacy Energy Vault has been carried forward after Closing.

All periods prior to the Merger have been retroactively adjusted using the Exchange Ratio for the equivalent number of shares outstanding immediately after the Closing to effect the reverse recapitalization.

The number of common stock issued following the consummation of the Merger was as follows (amounts in thousands):


			Shares
Legacy Energy Vault stock converted as part of Merger (1)			106,172
Novus public shares (2)			4,079
Novus sponsor shares (3)			3,975
PIPE shares			19,500
Total shares of Energy Vault common stock issued as part of the Merger			133,726

__________________

(1) Excludes 9.0 million common shares issuable in earn-out arrangements as they are not issuable until 90 days after the Closing and are contingently issuable based upon the Company’s share price meeting certain thresholds.

(2) Excludes 14.7 million warrants issued and outstanding as of the Closing of the Merger which includes 9.6 million public warrants and 5.2 million private warrants held by the Novus Sponsor.

(3) Includes 1.6 million common shares that have transfer restrictions based on the Company’s share price meeting certain thresholds. These 1.6 million common shares are held in escrow and are subject to potential forfeiture.

NOTE 4. REVENUE RECOGNITION

The Company recognized revenue for the product and service categories as follows for the years ended December 31, 2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
Build and transfer energy storage products (1)	$	85,636	$	—
Licensing of intellectual property (2)	58,483		—
Other (1)	1,758		—
Total revenue	$	145,877	$	—

__________________

(1) Represents revenue recognized over time

(2) Represents revenue recognized at a point-in-time.

Other revenue includes revenue of $0.7 million related to the amortization of deferred revenue related to providing construction support services to Atlas during the year ended December 31, 2022. Additionally, other revenue includes revenue of $1.1 million related to cost reimbursements from Atlas for providing construction support services during the year ended December 31, 2022.

The following table summarizes the Company’s revenue disaggregated by geographic region, which is determined based on the customer’s location, for the years ended December 31, 2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
United States	$	85,635	$	—
China	50,518		—
Other	9,724		—
Total revenue	$	145,877	$	—

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Remaining Performance Obligations

Remaining performance obligations represent the amount of unearned transaction prices under contracts for which work is wholly or partially unperformed. As of December 31, 2022, the amount of the Company’s remaining performance obligations was $331.0 million. The Company generally expects to recognize the majority of the remaining performance obligations as revenue within the next twelve months.

Contract Balances

The following table provides information about contract assets and contract liabilities from contracts with customers (amounts in thousands):


	December 31,
	2022		2021
Refundable contribution	$	25,000	$	—
Unbilled receivables	531		—
Retainage	3,447		—
Contract assets	$	28,978	$	—

Contract liabilities, current portion	$	49,434	$	—
Contract liabilities, long-term portion	1,500		1,500
Total contract liabilities	$	50,934	$	1,500

Contract assets consist of a refundable contribution, unbilled receivables, and retainage. Refundable contribution represents the contribution the Company made to Atlas to be used during the construction of its first GESS, which will be refunded to the Company upon Atlas’ first GESS obtaining substantial completion, subject to adjustments for potential liquidated damages if certain performance metrics are not met. Unbilled receivables represent the estimated value of unbilled work for projects with performance obligations recognized over time. Retainage represents a portion of the contract amount that has been billed, but for which the contract allows the customer to retain a portion of the billed amount until final contract settlement. Retainage is not considered to be a significant financing component because the intent is to protect the customer.

Contract liabilities consist of deferred revenue. Under certain contracts, the Company may be entitled to invoice the customer and receive payments in advance of performing the related contract work. In those instances, the Company recognizes a liability for advance billings in excess of revenue recognized, which is referred to as deferred revenue. Deferred revenue is not considered to be a significant financing component because it is generally used to meet working capital demands that can be higher in the early stages of a contract.

NOTE 5. FAIR VALUE MEASUREMENTS

Carrying amounts of certain financial instruments, including cash, accounts payable, and accrued liabilities approximate their fair value due to their relatively short maturities and market interest rates, if applicable.

The Company categorizes assets and liabilities recorded or disclosed at fair value on the consolidated balance sheet based upon the level of judgment associated with inputs used to measure their fair value. The categories are as follows:

•Level 1—Inputs which included quoted prices in active markets for identical assets and liabilities.

•Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3—Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

The Company’s financial assets and liabilities that were measured at fair value on a recurring basis as of December 31, 2022 and December 31, 2021 were as follows (amounts in thousands):

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements


	December 31, 2022
	Level 1	Level 2	Level 3	Total
Assets (Liabilities):

Derivative asset — conversion option (1)	—	—	1,025	1,025
Warrant liability (2)	—	—	2	2

December 31, 2021

Level 1

Level 2

Level 3

Total

Assets (Liabilities):

Derivative asset — conversion option (1)

—

350

__________________

(1) Refer to Note 7 - Convertible Note Receivable for further information.

(2) Refer to Note 12 - Warrants for further information.

NOTE 6. RELATED PARTY TRANSACTIONS

In May 2019, the Company received a $1.5 million deposit for an “EV1” tower from a customer that is owned by one of its primary shareholders; the order remains outstanding as of December 31, 2022. The deposit and order were received before the owner of the customer became one of the Company’s primary shareholders and before it was represented on the Company’s Board. This deposit is recognized in the line item, contract liabilities, long-term portion, in the consolidated balance sheets.

For the years ended December 31, 2022 and 2021, the Company ~~sold 28,750,000 Units which includes~~paid contracted engineering, design, and civil tolerance code calculation support of $0.4 million and $0.3 million, respectively, to an immediate family member of an executive officer. The Company retains all intellectual property as part of these services.

For the ~~full exercise~~years ended December 31, 2022 and 2021, the Company paid construction labor costs of $0.5 million and $0.5 million, respectively, for EV1 tower dismantlement and EVx test bed construction to a local company owned by an immediate family member of an employee.

During the year ended December 31, 2022, the Company paid $1.2 million in marketing and sales costs to a company that has a director who is an officer of the Company, and $0.3 million in primary market research and business development consulting costs to a company owned by an officer of the Company.

NOTE 7. CONVERTIBLE NOTE RECEIVABLE

In October 2021, the Company entered into a convertible promissory note purchase agreement with DG Fuels, LLC (“DG Fuels”) and purchased a promissory note with a principal balance of $1.0 million (“DG Fuels Tranche 1 Note”). In April 2022, the Company purchased an additional promissory note from DG Fuels with a principal balance of $2.0 million. (“DG Fuels Tranche 2 Note”) (collectively, the “DG Fuels Note”). The convertible promissory note is recorded in other assets in the consolidated balance sheets.

The maturity date of the DG Fuels Note is the earlier of (i) 30 days after a demand for payment is made by the ~~underwriters~~Company at any time after the two year anniversary of ~~their over-allotment~~the date of issuance of the note; (ii) the four year anniversary of the date of issuance of the note; (iii) five days following a Financial Close (“Financial Close” means a project finance style closing by DG Fuels or its subsidiary of debt and equity capital to finance the construction of that certain biofuel facility currently under development by DG Fuels), or (iv) upon an event of default determined at the discretion of the Company. The DG Fuels Note has an annual interest rate of 10.0%.

The Company intends to hold and convert the DG Fuels Note into the equity securities issued by DG Fuels in its next equity financing round that is greater than $20.0 million at a 20% discount to the issuance price. The principal balance and unpaid accrued interest on the DG Fuels Note will, at the option of the Company, convert into equity securities upon the closing of such next equity financing round.

The discounted conversion rate in the ~~amount~~DG Fuels Note is considered a redemption feature that is an embedded derivative, which requires bifurcation and separate accounting at its estimated fair value under ASC 815 – Derivative and Hedging.

Table of ~~3,750,000 Units at a~~Contents

ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The embedded derivative upon the purchase ~~price of $10.00 per Unit. Each Unit consists of 1 share~~ of the DG Fuels Tranche 1 Note was an asset of $0.4 million and the embedded derivative upon the purchase of the DG Fuels Tranche 2 Note was an asset of $0.7 million. The estimated fair value of the derivative instruments were recognized as a derivative asset on the consolidated balance sheets, with an offsetting discount to the DG Fuels Note. The Company amortizes the discount on the Note into interest income using the effective interest method. The Company recognized interest income of $0.3 million and $21 thousand for the years ended December 31, 2022 and 2021, respectively, from the DG Fuels Note. Interest income included income from the amortization of the debt discount of $0.1 million and $4 thousand for the years ended December 31, 2022 and 2021, respectively.

At each reporting period, the Company remeasures this derivative financial instrument to its estimated fair value. The change in the estimated fair value is recorded in other income (expense), net in the consolidated statements of operations and comprehensive loss. For the years ended December 31, 2022 and 2021, there was no change in fair value of the embedded derivative.

A reconciliation of the beginning and ending asset balance for the embedded derivative in the DG Fuels Note is as follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Balance at beginning of period	$	350	$	—
Additions	675		350
Change in fair value	—		—
Balance at end of period	$	1,025	$	350

The Company has determined that DG Fuels is a variable interest entity and that the Company has a variable interest in it through the DG Fuels Note. The Company is not the primary beneficiary of DG Fuels, and thus is not required to consolidate DG Fuels. The Company’s ~~Class A common stock~~maximum exposure to loss related to DG Fuels is limited to the Company’s investment of $3.0 million.

NOTE 8. PROPERTY AND EQUIPMENT, NET

As of December 31, 2022 and ~~one-third~~2021, property and equipment, net consisted of ~~one redeemable~~the following (amounts in thousands):


		December 31,
	Life (years)	2022		2021
Brick machines	6	$	657	$	2,515
Finance lease right-of-use assets – vehicles	4	178		175
Furniture and IT equipment	3 - 7	815		176
Leasehold improvements	4 - 7	529		179
Demonstration & test equipment		—		11,218
Construction in progress		1,268		—
Total property and equipment		3,447		14,263
Less: accumulated depreciation		(403)		(2,395)
Property and equipment, net		$	3,044	$	11,868

For the years ended December 31, 2022 and 2021 depreciation and amortization related to property and equipment was $7.7 million and $2.3 million, respectively.

The Company recognized impairment charges related to property and equipment of $2.8 million for the year ended December 31, 2022 on its demonstration and test equipment and brick machines.

Due to a change in the facts and circumstances during the year ended December 31, 2022, the Company completed the dismantling of the EV1 CDU during the 2022 fiscal year. Accordingly, the Company wrote off the carrying value of the demonstration and test equipment and certain components of the brick machines that could only be used for the EV1 CDU. This change in the facts and circumstances resulted in the recognition of accelerated depreciation of $3.8 million and

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

impairment charges of $2.8 million during the year ended December 31, 2022. The Company did not recognize any impairment charges on property and equipment, net during the year ended December 31, 2021.

NOTE 9. ASSET RETIREMENT OBLIGATION

The Company’s ARO relates to its obligation to dismantle the EV1 CDU and restore the land the EV1 CDU was located on to its original condition. The EV1 CDU was dismantled during 2022, but land restoration has not yet been completed as of December 31, 2022.

The following table summarizes the asset retirement obligation activity for the years ended December 31, 2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
Balance at beginning of period	$	978	$	123
Changes in estimates	—		751
Accretion expense	95		107
Liabilities settled	(487)		—
Foreign currency translation gain	(26)		(3)
Balance at end of period	$	560	$	978

NOTE 10. DEFINED BENEFIT PENSION OBLIGATION

The Company has a defined benefit pension plan for its employees in its wholly owned Switzerland subsidiary. The plan is a statutory requirement in accordance with local regulations. The Swiss pension plans are governed by the Swiss Federal Law on Occupational Retirements, Survivors’ and Disability Pension plans. The Company used third party providers to administer these plans. Benefits provided by the pension plan are based on years of service and employees’ remuneration over their employment period. The Company uses December 31 as the year end measurement date for this plan.

The Company’s policy is to fund its pension obligations in conformity with the funding requirements under applicable laws and governmental regulations. The pension plans maintain investment policies that, among other things, establish a portfolio asset allocation methodology with percentage allocation bands for individual asset classes. The investment policies provide that investments are reallocated between asset classes as balances exceed or fall below the appropriate allocation bands.

The assumption used for the expected long-term rate of return on plan asset is based on the long-term expected returns for the investment mix of assets currently in the portfolio. Historical return trends for the various asset classes in the class portfolio are combined with current and anticipated future market conditions to estimate the rate of return for each class. These rates are then adjusted for anticipated future inflation to determine estimated nominal rates of return for each class.

The accumulated benefit obligation (ABO) represents the obligations of a pension plan for past service as of the measurement date, which is the present value of benefits earned to date based on current compensation levels.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Obligations and Funded Status

The following table presents the defined benefit plans’ funded status and amount recognized in the consolidated balance sheets as of December 31, 2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
Change in Benefit Obligation
Benefit obligation at beginning of year	$	2,662	$	2,425
Service cost	162		130
Interest cost	9		5
Actuarial (gain) loss	(149)		99
Benefits paid	866		40
Plan participant’s contributions	137		86
Plan amendments	350		(50)
Foreign currency translation adjustments	8		(73)
Benefit obligation at end of year	$	4,045	$	2,662
Change in Plan Assets
Fair value of plans assets at beginning of year	$	1,928	$	1,592
Actual return on plans’ assets	74		214
Employer contributions	137		43
Benefits paid	866		40
Plan participant’s contributions	137		85
Foreign currency translation adjustments	13		(46)
Fair value of plans assets at end of year	$	3,155	$	1,928
Funded Status at End of Year
Fair value of plan assets	$	3,155	$	1,928
Benefit obligation	(4,045)		(2,662)
Liability recognized at end of year	$	(890)	$	(734)

Components of Net Periodic Benefit Cost

The components of net periodic pension benefit cost for the Company’s defined benefit pension plans for the years ended December 31, 2022 and 2021 were as follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Employer service costs	$	162	$	130
Interest cost	9		5
Expected return on plan assets	(72)		(53)
Amortization of net prior service credit	(13)		(7)
Amortization of net loss	39		59
Net periodic benefit cost	$	125	$	134

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Impact on Accumulated Other Comprehensive Income (Loss)

Amounts recognized in accumulated other comprehensive income (loss) at December 31, 2022 and 2021 were as follows (amounts in thousands):


	December 31,
	2022		2021
Net prior service credit (cost)	$	(262)	94
Net loss	(383)		(551)
Accumulated other comprehensive loss	$	(645)	$	(457)

Changes in accumulated other comprehensive income (loss) for the Company’s pension plan were as follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Accumulated other comprehensive loss at beginning of year	$	(457)	(623)
Change in net prior service credit (cost)	(360)		40
Change in net gain	189		112
Foreign currency translation adjustments	(17)		14
Accumulated other comprehensive loss at end of year	$	(645)	$	(457)

Assumptions

The assumptions used to measure the benefit obligation and net periodic benefit cost for the Company’s defined benefit pension plan were as follows:


	2022		2021
Discount rate	1.8	%	0.4	%
Expected long-term return on plan assets	4.7	%	3.8	%
Rate of compensation increase	1.5	%	1.0	%
Pension increase rate (in payment)	0.0	%	0.0	%

Investment Strategy

As is customary with Swiss pension plans, the plan assets are invested in a Swiss collective fund with multiple employers. The Company does not have rights to the individual assets of the plans nor does the Company have investment authority over the assets of the plans. The collective fund maintains a variety of investment positions primarily in equity securities and highly rated debt securities. The valuation of the collective fund assets as a whole is a Level 3 measurement; however the individual investments of the fund are generally Level 1 (equity securities and cash), Level 2 (fixed income) and Level 3 (real estate and alternative) investments. The Company determines the fair value of the plan assets based on information provided by the collective fund, through review of the collective fund’s annual financial statements, and the Company further considers whether there are other indicators that the investment balances reported by the fund could be impaired. The Company concluded that no such impairment indicators were present at December 31, 2022.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The Swiss pension plans’ actual asset allocation as compared to the plan administrators’ target asset allocations for fiscal years 2022 and 2021 were as follows:


	2022		2021		Target
Equity instruments (Level 1)	47.3	%	50.2	%	30% – 55%
Debt instruments (Level 2)	9.7	%	10.6	%	5% – 30%
Real estate (Level 3)	30.0	%	26.4	%	15% – 40%
Alternative investments (Level 3)	7.7	%	5.3	%	0% – 15%
Cash and equivalents (Level 1)	5.3	%	7.5	%	0% – 15%
Total	100.0	%	100.0	%

Cash Flows

Estimated future benefit payments expected to be paid by the defined benefit pension plan at December 31, 2022 are as follows (amounts in thousands):


Year Ending December 31,	Future Benefits
2023	$	42
2024	43
2025	43
2026	44
2027	45
Thereafter	227
Total	$	444

The estimated employer contribution to the defined benefit pension plan in fiscal year 2023 is approximately $0.2 million.

Defined Contribution Plan

The Company sponsors a defined contribution retirement plan for its United States employees. The Company did not make any matching contributions during 2022 and 2021. In January 2023, the Company began matching participants’ contributions up to a maximum of 3.5% of compensation.

NOTE 11. LEASES

The Company has operating leases for its corporate offices, field offices, and vehicles. The Company recognizes a ROU asset and lease liability for operating leases based on the net present value of future minimum lease payments. Lease expense is recognized on a straight-line basis over the non-cancelable lease term and renewal periods that are considered reasonably certain.

The Company has finance leases for vehicles. The Company recognizes a ROU asset and lease liability for finance leases based on the net present value of future minimum lease payments. Lease expense for the Company’s finance leases is comprised of the amortization of the right of use asset and interest expense recognized based on the effective interest method.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The components of lease expense for the years ended December 31, 2022 and 2021 are as follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Operating lease expense	$	853	$	647
Finance lease expense
Amortization of finance ROU assets	47		45
Interest on finance lease liabilities	2		3
Short-term lease expense	339		80
Variable lease expense	12		3
Sublease income	(9)		—
Total	$	1,244	$	778

Supplemental balance sheet information related to leases as of December 31, 2022 and 2021 is as follows:


	December 31,
	2022		2021
Weighted Average Remaining Lease Term (Years)
Operating leases	2.4		2.2
Finance leases	2.1		1.8

Weighted Average Discount Rate
Operating leases	8.6	%	7.4	%
Finance leases	4.4	%	2.8	%

Supplemental cash flow information related to leases for the fiscal years ended December 31, 2022 and 2021 is as follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Cash Paid for Amounts Included in the Measurement of Lease Liabilities
Operating cash flows used for operating leases	$	836	$	532
Operating cash flows used for finance leases	2		3
Financing cash flows used for finance leases	62		53
	$	900	$	588

ROU Assets obtained in Exchange for Lease Liabilities
Operating leases	$	962	$	476
Finance leases	37		44
	$	999	$	520

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

Future maturities of operating and finance lease liabilities as of December 31, 2022 are as follows (amounts in thousands):


	Operating Leases		Finance Leases
2023	$	876	$	40
2024	482		6
2025	110		6
2026	105		5
2027	61		—
Thereafter	—		—
Total undiscounted cash flows	1,634		57
Less imputed interest	(138)		(3)
Present value of lease liabilities	$	1,496	$	54

NOTE 12. WARRANTS

Upon the Closing of the Merger, the Company assumed 9.6 million Public Warrants and 5.2 million Private Warrants. Each whole warrant ~~(“Public Warrant”). Each Public Warrant~~ entitles the holder to purchase 1one share of ~~Class A~~the Company’s common stock at an exercise price of $11.50 per ~~whole share.~~

~~NOTE 4. PRIVATE PLACEMENT~~

~~Simultaneously with~~share, subject to adjustments. The warrants became exercisable on March 13, 2022, and at that time were scheduled to expire on February 11, 2027, which represents five years after the ~~closing of the Initial Public Offering, the Sponsor purchased an aggregate of 5,166,666 Private Placement Warrants at~~Closing.

The Company filed a price of $1.50 per Private Placement Warrant ($7,750,000 in the aggregate), each exercisable to purchase 1 share of Class A common stock at a price of $11.50 per share, in a private placement. The proceeds from the sale of the Private Placement Warrants were addedRegistration Statement on Form S-1 on March 8, 2022 related to the ~~net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale~~issuance of ~~the Private Placement Warrants will be used to~~

~~F-13~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless.~~

~~NOTE 5. RELATED PARTY TRANSACTIONS~~

~~Founder Shares~~

On October 12, 2020, the Initial Stockholders purchased 7,187,500 shares (the “Founder Shares”) of the Company’s Class B common stock for an aggregate price of $25,000. The Founder Shares include an aggregate of up to ~~937,500~~approximately 14.8 million shares subject to forfeiture by the initial stockholders to the extent that the underwriter’s over-allotment is not exercised in full or in part, so that the Sponsor will collectively own, on an as-converted basis, 20% of the Company’s issued and outstanding shares after the Initial Public Offering (assuming the Sponsor does not purchase any Public Shares in the Initial Public Offering). As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are subject to forfeiture.

The Initial Stockholders have agreed, subject to certain limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earlier to occur of: (1) one year after the completion of a Business Combination or (B) subsequent to a Business Combination, (x) if the last reported sale price of the Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, capital stock exchange or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property.

~~Promissory Note — Related Party~~

On October 1, 2020, certain of the Company’s directors agreed to loan the Company an aggregate of up to $300,000 to cover expenses related to the Initial Public Offering pursuant to promissory notes (the “Promissory Notes”). The Promissory Notes are non-interest bearing and are payable on the earlier of (i) December 31, 2021 and (ii) the consummation of the Initial Public Offering. As of December 31, 2020, the Company had $160,000 outstanding under the Notes. The outstanding balance under the Promissory Note of $80,000 was subsequently repaid on February 8, 2021, while the remaining $80,000 was repaid on February 10, 2021.

~~Related Party Loans~~

In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor or certain of the Company’s directors and officers may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $2,000,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants.

~~NOTE 6. COMMITMENTS AND CONTINGENCIES~~

~~Registration Rights~~

Pursuant to a registration rights agreement entered into on February 3, 2021, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of the Working Capital Loans (and any shares of Class A common stock issuable upon the exercise of the Public and Private ~~Placement~~ Warrants, which was declared effective by the SEC on May 6, 2022.

Public Warrants

On July 1, 2022 the Company announced (“Redemption Notice”) it would redeem all of its Public Warrants that remained outstanding at 5:00 p.m. New York City time on August 1, 2022 (the “Redemption Date”) for $0.10 per warrant (the “Redemption Price”). The Public Warrant Holders were permitted to exercise their warrants and ~~warrants~~receive common stock (i) in exchange for a payment in cash of the $11.50 per warrant exercise price, or (ii) on a cashless basis in which the exercising holder received 0.2526 of common stock for each warrant surrendered for exercise. Any Public Warrants that ~~may~~remained unexercised at 5:00 p.m. New York City time on the Redemption Date would be void and no longer exercisable, and the holders of those Public Warrants would be entitled to receive only the Redemption Price.

Prior to the Redemption Notice, 0.7 million shares of common stock were issued related to the exercise of an equivalent number of Public Warrants. Subsequent to the Redemption Notice, 2.2 million shares of common stock were issued upon ~~conversion~~the cashless exercise of ~~Working Capital Loans)~~8.7 million Public Warrants. 0.2 million in unexercised and outstanding Public Warrants as of 5:00 p.m., August 1, 2022 were ~~granted registration rights to require~~redeemed at a price of $0.10 per Public Warrant. No Public Warrants remained outstanding as of December 31, 2022.

Private Warrants

The Private Warrants are exercisable on a cash or cashless basis, at the ~~Company to register a sale of any of the securities for resale (in the case of the~~

~~F-14~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~Founder Shares, only after conversion to shares of Class A common stock). The holders of these securities~~warrant holders’ option, and are entitled to make up to 3 demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. Notwithstanding the foregoing, Cowen Investments may not exercise its demand and “piggyback” registration rights after five and seven years, respectively, after the effective date of the Initial Public Offering. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

~~Business Combination Marketing Agreement~~

~~The Company engaged the underwriters as an advisor in connection with a Business Combination to assist~~redeemable by the Company, in ~~holding meetings with its stockholders~~each case so long as the warrants are still held by Novus or their permitted transferees. If the Private Warrants are no longer held by Novus or their permitted transferees, the redemption right included in the Public Warrants will attach to ~~discuss~~ the ~~potential Business Combination~~Private Warrants. The Private Warrants are exercisable until February 11, 2027.

Table of Contents

ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The following table summarizes the Public and Private Warrants activities for the year ended December 31, 2022 (amounts in thousands):


	Year Ended December 31, 2022
	Public Warrants	Private Warrants	Total Warrants
Warrants assumed upon the Closing of the Merger	9,583	5,167	14,750
Warrants exercised	(9,348)	—	(9,348)
Warrants redeemed	(235)	—	(235)
End of period	—	5,167	5,167

The Public Warrants were classified as Level 1 measurements as the Public Warrants had an adequate trading volume to provide reliable indication of value from the Closing of the Merger to the Redemption Date. The Private Warrants were classified as Level 2 from the Closing of the Merger until the Redemption Date because the Private Warrants had similar terms to the Public Warrants. Upon the ceasing of trading of the Public Warrants on the Redemption Date, the fair value measurement of the Private Warrants transferred from Level 2 to Level 3 and the ~~target business’ attributes, introduce~~Company used a Black Scholes model to determine the ~~Company~~fair value of the Private Warrants. The primary significant unobservable input used to ~~potential investors that are interested in purchasing~~evaluate the fair value measurement of the Company’s ~~securities in connection with a Business Combination, provide financial advisory services to assist~~Private Warrants is the ~~Company~~expected volatility. A significant increase in the expected volatility in isolation would result in a significantly higher fair value measurement. The Private Warrants were valued at less than $0.01 per warrant as of December 31, 2022.

The following table provides the assumptions used to estimate the fair value of the Private Warrants as of December 31, 2022:


	December 31, 2022
Common stock price	$	3.12
Exercise price	$	11.50
Expected term (in years)	4.12
Expected volatility	17.4		%
Risk-free interest rate	4.1		%
Expected dividend yield	—		%

The Public and Private Warrants are measured at fair value on a recurring basis. The following table presents the changes in the fair value of the Company’s ~~efforts to obtain any stockholder approval~~Public and Private Warrants liabilities for the ~~Business Combination and assist the Company with its press releases and public filings~~year ended December 31, 2022 (amounts in ~~connection with the Business Combination. The Company will pay the underwriters a cash fee for such services upon the consummation~~thousands):


	Year Ended December 31, 2022
	Public Warrants		Private Warrants		Total Warrants
Warrant liability assumed upon the Closing of the Merger	$	12,938	$	6,900	$	19,838
Warrants exercised	(17,483)		—		(17,483)
Warrants redeemed	(23)		—		(23)
Change in fair value	4,568		(6,898)		(2,330)
Warrant liability at end of period	$	—	$	2	$	2

Table of ~~a Business Combination in an amount equal~~Contents

ENERGY VAULT HOLDINGS, INC.

Notes to ~~in the aggregate, 3.5%~~Consolidated Financial Statements

NOTE 13. SUPPLEMENTAL BALANCE SHEETS DETAIL


	December 31,
(amounts in thousands)	2022		2021
Prepaid expenses and other current assets:
Deposits for project equipment and materials	$	24,327	$	—
Prepaid expenses	6,609		1,140
Tax refund receivable	454		121
Deferred merger costs	—		4,121
Other	179		156
Total	$	31,569	$	5,538


	December 31,
(amounts in thousands)	2022		2021
Other assets:
Investment in equity securities	$	9,000	$	—
Convertible note receivable	2,080		654
Derivative asset — conversion option	1,025		350
Other	1,795		521
Total	$	13,900	$	1,525


	December 31,
(amounts in thousands)	2022		2021
Accrued Expenses:
Employee costs	$	8,711	$	3,756
Taxes payable	4,168		—
Professional fees	1,671		81
Prototype costs	—		716
Other	199		151
Total	$	14,749	$	4,704

NOTE 14. STOCKHOLDERS’ EQUITY

Redeemable Convertible Preferred Stock

As part of the ~~gross proceeds~~Merger, 85.7 million shares of ~~Initial Public Offering.~~

~~Business Combination Agreement~~

On September 8, 2021, the Company, Merger Sub and Energy Vault entered into the Business Combination Agreement, pursuant to which Novus and Energy Vault will consummate the Business Combination. The Business Combination Agreement contains customary representations and warranties, covenants, closing conditions, termination fee provisions and other terms relating to the Merger and the other transactions contemplated thereby.

The Merger is to become effective by the filing of a certificate of merger with the Secretary of State of the State of Delaware, in accordance with the relevant provisions of the Delaware General Corporation Law and mutually agreed by the parties and will be effective immediately upon such filing or upon such later time as may be agreed by the parties and specified in such certificate of merger (such time, “Effective Time”). The parties will hold the Closing immediately prior to such filing of a certificate of merger, on the Closing Date.

The Effective Time shall occur as promptly as practicable but in no event later than three business day after the satisfaction or, if permissible, waiver of the conditions to the completion of the Business Combination set forth in the Business Combination Agreement (other than those conditions that by their nature are to be satisfied at Closing, provided that the occurrence of the Closing shall remain subject to the satisfaction or, if permissible, waiver at the Closing). Immediately prior to the Effective Time, Energy Vault shall cause each share of Energy Vault Preferred Stock that is issued and outstanding ~~immediately prior to the Effective Time to be automatically~~redeemable convertible preferred stock were cancelled and converted into ~~a number of~~ 85.7 million shares of Energy Vault ~~Common Stock at the then effective conversion rate as calculated pursuant to Energy Vault’s amended~~common stock based upon an exchange ratio of 6.7735. A total of $182.7 million redeemable convertible preferred stock was reclassified into common stock and restated certificate of incorporation. All of the shares of Energy Vault Preferred Stock converted into shares of Energy Vault Common Stock shall no longer be outstanding and shall cease to exist, and each holder of Energy Vault Preferred Stock shall thereafter cease to have any rights with respect to such securities.

~~At the Effective Time, by virtue of the Merger and without any action~~additional paid-in-capital on the ~~part of the Company, Merger Sub, Energy Vault or the holders of any of Energy Vault’s securities:~~

Each share of Energy Vault Common Stock issued and outstanding immediately prior to the Effective Time will be cancelled and automatically converted into the right to receive the number of shares of Combined Company Common Stock equal to the Exchange Ratio and all shares of Energy Vault Common Stock subject to forfeiture to or repurchase by Energy Vault shall retain such restrictions following conversion into Combined Company Common Stock;

All shares of Energy Vault Common Stock and Energy Vault Preferred Stock held in the treasury of Energy Vault shall be canceled without any conversion thereof and no payment or distribution shall be made with respect thereto;

~~F-15~~

consolidated balance sheet.

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

Each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall be converted into and exchanged for one validly issued, fully paid and nonassessable share of common stock, par value $0.001 per share, of the surviving corporation;

Each Energy Vault Option that is outstanding immediately prior to the Effective Time, whether vested or unvested, shall be assumed, converted and/or substituted by Novus into an option to purchase a number of shares of Combined Company Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of Energy Vault Common Stock subject to such Energy Vault Option immediately prior to the Effective Time and (y) the Exchange Ratio, and at an exercise price per share (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such Energy Vault Option immediately prior to the Effective Time divided by (B) the Exchange Ratio, subject to adjustments related to Section 409A and Section 422 of the Code;

Each award of outstanding restricted stock units to acquire shares of Energy Vault Common Stock issued pursuant to an award granted under the 2017 Plan or otherwise (each an “Energy Vault RSU”), whether vested or unvested, that is outstanding immediately prior to the Effective Time shall be assumed, converted and/or substitutes by Novus into an award of restricted stock units to acquire shares of Combined Company Common Stock (each, a Converted RSU Award). Each Converted RSU Award will represent the right to acquire that number of shares of Combined Company Common Stock equal to the product (rounded down to the nearest whole number) of (1) the number of shares of Energy Vault Common Stock subject to the Energy Vault RSU award immediately before the Effective Time and (2) the Exchange Ratio; provided, that, except as specifically described above, following the Effective Time, each Converted RSU Award shall continue to be governed by the same terms and conditions (including vesting terms) as were applicable to the corresponding former Energy Vault RSU award immediately prior to the Effective Time.

Each award of outstanding restricted shares of Energy Vault Common Stock issued pursuant to a grant agreement under the 2017 Plan or otherwise (each an “Energy Vault Restricted Share Award”), whether vested or unvested, that is outstanding immediately prior to the Effective Time shall be assumed, converted and/or substituted by Novus into a restricted stock award with respect to a number of shares of Combined Company Common Stock equal to the product (rounded down to the nearest whole number) of (x) the number of shares of Energy Vault Common Stock subject to such Energy Vault Restricted Share Award immediately prior to the Effective Time and (y) the Exchange Ratio, with the same terms and conditions as were applicable under such Company Restricted Share Award immediately prior to the Effective Time.

~~Earn Out~~

~~Subject~~ENERGY VAULT HOLDINGS, INC.

Notes to certain exceptions, during the period between the date that is 90 days following the Closing and the third anniversary of the Closing, the Company will issue to eligible Energy Vault equity holders up to 9,000,000 additional shares of the Company’s Common Stock in the aggregate (the “Earn Out Shares”) in three equal tranches of 3,000,000 Earn Out Shares, respectively, upon the Company’s achieving price targets of $15.00, $20.00 or $30.00, respectively, which price targets will be based upon the closing sale price of one share of the Company’s Common Stock quoted on the New York Stock Exchange or the exchange on which the shares of the Company’s Common Stock are then traded, for any 20 trading days within a 30 consecutive trading day period (as adjusted for stock splits, reverse stock splits, stock dividends, reorganizations, recapitalizations, reclassifications, combination, exchange of shares or the like).

~~Subscription Agreements~~

In connection with the execution of the Business Combination Agreement, on September 8, 2021, the Company entered into separate subscription agreements (collectively, the “Subscription Agreements”) with a number of investors (each, a “Subscriber” and collectively, the “Subscribers”), pursuant to which the Subscribers agreed to purchase, and the Company agreed to sell to the Subscribers, an aggregate of 10,000,005 shares of the Company’s Common Stock (the “PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $100,000,050 in a private placement (the “PIPE”).

Consolidated Financial Statements

~~F-16~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

The closing of the sale of the PIPE Shares pursuant to the Subscription Agreements is contingent upon, among other customary closing conditions, the concurrent consummation of the Proposed Transactions. The purpose of the PIPE is to raise additional capital for use by the combined company following the Closing.

Pursuant to the Subscription Agreements, the Company agreed that, by the later of 30 calendar days and 20 business days after the consummation of the Proposed Transactions, the Company will file with the SEC (at the Company’s sole cost and expense) a registration statement registering the resale of the PIPE Shares (the “PIPE Resale Registration Statement”), and the Company shall use its commercially reasonable efforts to have the PIPE Resale Registration Statement declared effective as soon as practicable after the filing thereof, but no later than the earlier of (i) the 60th calendar day (or 120th calendar day if the SEC notifies the Company that it will “review” the PIPE Resale Registration Statement) following the Closing and (ii) the 10th business day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that the PIPE Resale Registration Statement will not be “reviewed” or will not be subject to further review.

On December 29, 2021, the Company entered into a Subscription Agreement with the Subscriber, pursuant to which the Subscriber agreed to purchase, and the Company agreed to sell the Subscriber, 5,000,000 shares of Class A common stock, par value of $0.0001 per share (the “Additional PIPE Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $50,000,000 in a private placement. Pursuant to the Subscription Agreement, the Additional PIPE Shares will be sold upon the same terms and conditions as those set forth in those certain Subscription Agreements entered into between the Company and certain other investors on September 8, 2021 in connection with the execution of the Business Combination Agreement among the Company, the Merger Sub and Energy Vault. The closing of the sale of the Additional PIPE Shares pursuant to the Subscription Agreement is contingent upon, among other customary closing conditions, the concurrent consummation of the Proposed Transactions. The purpose of the sale of the Additional PIPE Shares is to raise additional capital for use by the combined company following the closing of the Proposed Transactions.

~~Vendor Agreements~~

On April 30, 2021, the Company entered into an agreement with a vendor for investment banking services related to the pending Business Combination. Specifically, the agreement relates to assisting in raising the funds as part of the PIPE financing. The agreement calls for the vendor to receive a contingent fee equal to 70% of the total placement fee paid as part of the PIPE financing which is expected to equal 5% of the gross proceeds of securities sold in the PIPE placement.

On May 21, 2021, the Company entered into an agreement with a vendor for financial advisement services related to the Business Combination. The agreement calls for the vendor to receive a contingent fee in the amount of $7,500,000 plus expenses. In addition, the agreement contains an additional contingent fee provision of 1% of the gross proceeds of any equity or equity-linked securities sold in connection with the Business Combination.

On September 13, 2021, the Company entered into an agreement with a vendor for capital market advisement services related to the Business Combination. The agreement calls for the vendor to receive a contingent fee in the amount of $500,000 upon the consummation of the Business Combination.

On September 29, 2021, the Company entered into an agreement with a vendor for tax advisory services related to the Business Combination agreement. The agreement calls for the vendor to receive a fee of $20,000 a month through December 31, 2021. As of December 31, 2021, the ~~Company incurred legal fees~~Company’s convertible preferred stock consisted of ~~approximately $2,750,000. These fees will only become due~~the following (amounts in thousands and ~~payable upon~~adjusted for Merger exchange ratio):


	Shares Designated	Shares Issued and Outstanding	Liquidation Preference
Series C preferred stock	14,787	14,787	$	107,000
Series B-1 preferred stock	14,475	14,475	31,003
Series B preferred stock	14,651	14,651	25,003
Series A-2 preferred stock	5,087	5,087	3,555
Series A-1 preferred stock	6,950	6,950	3,076
Series Seed 2 preferred stock	4,240	4,240	934
Series Seed 1 preferred stock	11,190	11,190	753
Series FR preferred stock	14,361	14,361	25
	85,741	85,741	$	171,349

The significant rights and preferences of the ~~consummation~~outstanding convertible preferred stock through the closing of ~~an initial Business Combination.~~

Asthe Merger were as follows:

Dividends

Through the closing date, the holders of ~~December 31, 2021,~~each class of convertible preferred stock had been entitled to receive non-cumulative dividends at 8% per annum, if and when declared by the ~~Company incurred printer fees~~Board. Through the closing date of ~~approximately $336,000. These fees will only become due and payable upon~~ the ~~consummation~~Merger, no dividends had been declared.

Conversion

Until the closing of ~~an initial Business Combination.~~

~~NOTE 7. STOCKHOLDERS’ EQUITY~~

~~Preferred Stock~~ ~~— The Company is authorized to issue 5,000,000 shares of $0.0001 par value preferred stock. At December 31, 2021 and 2020, there were 0 shares~~the Merger, each class of preferred stock ~~issued or outstanding.~~

~~F-17~~

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~Class A Common Stock~~ ~~— The Company is authorized~~was convertible to issue up to 500,000,000 shares of Class A, $0.0001 par value common stock. Holders of the Company’s common stock are entitled to 1 vote for each share. At December 31, 2021, there were 28,750,000 shares of Class A common stock issued and ~~outstanding~~ ~~which are presented as temporary equity. At December 31, 2020, there were 0 shares of Class A common stock issued or~~ ~~outstanding~~.

~~Class B Common Stock~~ — The Company is authorized to issue up to 20,000,000 shares of Class B, $0.0001 par value common stock. Holders of the Company’s common stock are entitled to 1 vote for each share. At December 31, 2021 and 2020, there were 7,187,500 shares of Class B common stock issued and outstanding.

~~Holders of Class A common stock and Class B common stock will vote together as a single class on all other matters submitted to a vote of shareholders, except as required by law.~~

~~The shares of Class B common stock will automatically convert into shares of Class A~~ common stock at the ~~time~~option of ~~a Business Combination on a one-for-one basis (subject~~the holder at the conversion price (as defined in the articles of incorporation) which was initially equal to ~~adjustment). In~~ the ~~case that additional shares~~original issuance price of ~~Class A~~each of the preferred stock issuances. The preferred stock would be automatically converted to common stock ~~or equity-linked securities, are issued or deemed issued in excess~~upon the earlier of; (a) a firm commitment underwritten initial public offering to an effective registration statement and sale of ~~the amounts offered in the Initial Public Offering and related~~common stock to the ~~closing~~public of ~~a Business Combination, the ratio at which shares~~not less than $49.0258 per share (minimum price per share does not apply to Series FR, Seed 1 and Seed 2 preferred stock) with gross proceeds not less than $50.0 million, or (b) by written consent of ~~Class B common stock shall convert into shares of Class A common stock will be adjusted (unless~~ the holders of a majority of the then outstanding shares of ~~Class B~~preferred stock voting as single class on an as-converted to common stock ~~agree~~basis, with the holders of the Series A, Seed 2, Seed 1, and Series FR preferred stock voting as a separate class on an as-converted basis, the holders of the Series B voting as a separate class on an as-converted basis, the holders of the Series B-1 voting as a separate class on an as-converted basis, and the holders of the Series C voting as a separate class on an as-converted basis.

The conversion price was subject to ~~waive such~~ adjustment ~~with respect~~for stock splits and stock dividends, reorganization, reclassifications, or similar events and was to be adjusted proportionately. The conversion price would have also been adjusted for certain dilutive issuances of common stock or securities exercisable or convertible into common stock at a price below the conversion price in effect at the time (price protection or ratchet feature). The adjustment to the conversion price would have been determined by multiplying the conversion price by a fraction calculated as the diluted shares pre-issuance at the conversion price divided by the common stock pre-issuance plus the additional stock issued (partial ratchet).

Liquidation

Until the closing of the Merger, in the event of any liquidation, dissolution, or winding up of the Company, the holders of Series B, Series B-1 and Series C preferred stock would have been entitled to, in preference to the holders of each of the other classes of preferred stock, and to the common stockholder, an amount equal to the original issuance price plus declared but unpaid dividends. After payment in full to the holders of Series B, Series B-1 and Series C preferred stock, and prior to any distribution to the common stockholders, each of the other classes of preferred stock would have been entitled to receive an amount equal to the original issue price plus declared and unpaid dividends on such ~~issuance~~shares, payable on a pari-passu basis among the Series.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

A liquidation, dissolution, or winding up of the Company would have been deemed ~~issuance) so~~to have occurred upon completion of any transaction or event that resulted in a change of control as defined in the articles of incorporation (a “Deemed Liquidation Event”). Upon a Deemed Liquidation Event, the preferred stock would have become redeemable at the option of the holder and the Company would have been required to provide written notice to the holders of the preferred stock within 90 days of such an event informing them of their right to redeem the preferred stock. For purposes of determining the amount each holder of preferred stock would have been entitled to receive upon a Deemed Liquidation Event, each class of preferred stock would have been deemed to have automatically converted their shares into common stock at the as converted value (even if not elected by the holder) immediately prior to such a Deemed Liquidation Event, if the value was greater than the amount that would have been distributed to the holder of the preferred stock if it were not converted.

Voting

Until the closing of the Merger, each share of preferred stock was entitled to the number of votes equal to the number of shares of ~~Class A~~ common stock ~~issuable upon conversion of all~~into which the shares of ~~Class B~~preferred stock so held could be converted at the record date.

Common Stock

On February 11, 2022, in connection with the reverse recapitalization treatment of the Merger, the Company effectively issued 27.6 million new shares of common stock. Additionally as part of the Merger, the Company converted all 3.0 million issued and outstanding common stock ~~will equal, in the aggregate, on an as-converted basis, 20%~~and all 12.7 million issued and outstanding convertible preferred stock of ~~the sum of the total number of all~~Legacy Energy Vault into 106.2 million new shares of common stock ~~outstanding upon completion~~using an exchange ratio of 6.7735.

NOTE 15. STOCK-BASED COMPENSATION

2017 Stock Incentive Plan

In 2017, the Company adopted its 2017 Stock Incentive Plan (the “2017 Plan”) which provides for the granting of stock options, restricted stock, and RSUs to employees, directors, and consultants of the ~~Initial Public Offering plus~~Company. Options granted under the 2017 Plan were either ISOs or Nonqualified Stock Options (“NSOs”). Awards under the 2017 Plan may be granted for periods of up to ten years. Under the terms of the 2017 Plan, awards may be granted at an exercise price not less than the estimated fair value of the shares on the date of grant, as determined by the Company’s Board. For employees holding more than 10% of the voting rights of all classes of stock, the exercise price of ISOs and NSOs may not be less than 110% of the estimated fair value of the shares on the date of grant, as determined by the Board. Awards generally vest over one to four years.

2020 Stock Incentive Plan

In 2020, the Company adopted its 2020 Stock Incentive Plan (the “2020 Plan”) which superseded the previous 2017 Plan. The 2020 Plan provides for the granting of stock options, restricted stock, and RSUs to employees, directors, and consultants of the Company. Options granted under the 2020 Plan may be either ISOs or NSOs. Awards under the 2020 Plan may be granted for periods of up to ten years. Under the terms of the 2020 Plan, awards may be granted at an exercise price not less than the estimated fair value of the shares on the date of grant, as determined by the Company’s Board. For employees holding more than 10% of the voting rights of all classes of stock, the exercise price of ISOs and NSOs may not be less than 110% of the estimated fair value of the shares on the date of grant, as determined by the Board. Awards generally vest over one to four years.

2022 Equity Incentive Plan

In 2022, the Company adopted its 2022 Equity Incentive Plan (the “2022 Incentive Plan”), which superseded the previous 2020 Plan, provides for the granting of stock options, stock appreciation rights (“SARs”), restricted stock, and RSUs to employees, non-employee directors, and consultants of the Company. Shares of common stock underlying awards that expire or are forfeited or canceled will again be available for issuance under the 2022 Incentive Plan.

The number of shares of ~~Class A~~the Company’s common stock reserved for issuance under the 2022 Incentive Plan is approximately 15.5 million, plus up to approximately 8.3 million shares subject to awards granted under the 2017 and ~~equity-linked securities~~2020 Plans. Additionally, beginning on March 1, 2022 and ending on (and including) March 31, 2031, the number of shares of the Company’s common stock that may be issued under the 2022 Incentive Plan will increase by a number of shares equal to the lesser of (i) 4.0% of the outstanding shares on the last day of the immediately preceding fiscal year or ~~deemed issued~~(ii) such lesser

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

number of shares (including zero) that the Company’s Board determines for the purposes of the annual increase for that fiscal year.

2022 Inducement Plan

In 2022, the Company adopted its 2022 Inducement Plan, which provides for the granting of stock options, SARs, restricted stock, and RSUs to individuals who were not previously employees of Energy Vault, or following a bona fide period of non-employment, as inducement material to such individuals entering into employment with Energy Vault. Shares of common stock underlying awards that expire or are forfeited or canceled will again be available for issuance under the 2022 Inducement Plan. 8.0 million shares of the Company’s common stock are reserved for issuance under the 2022 Inducement Plan.

Stock Option Activity

Stock option activity for the years ended December 31, 2022 and 2021 are as follows (amounts in ~~connection~~thousands, except per share data):


	Options Outstanding
	Number of Options (1)	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Balance as of December 31, 2020	576	$	0.09	7.48	$	423
Stock options granted	1,142	0.89
Stock options exercised	(373)	0.01

Balance as of December 31, 2021	1,345	0.79		9.11	7,024

Stock options exercised	(212)	0.80
Stock options forfeited, canceled, or expired	(40)	0.80
Balance as of December 31, 2022	1,093	0.79		8.10	2,551

Options exercisable as of December 31, 2022	796	0.69		7.89	1,936
Options vested and expected to vest as of December 31, 2022	1,093	$	0.79	8.10	2,551

__________________

(1) The number of options prior to the Merger have been retroactively restated to reflect the exchange ratio of 6.7735 established in the Merger.

As of December 31, 2022, total unamortized stock-based compensation expense related to unvested awards that are expected to vest was $0.6 million. The weighted-average period over which such stock-based compensation expense will be recognized is approximately 2.74 years.

The aggregate intrinsic values of options outstanding, exercisable, vested and expected to vest were calculated as the difference between the exercise price of the options and the closing stock price of the Company’s common stock on the NYSE as of December 31, 2022.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

The Company estimates the fair value of the options on the grant date utilizing the Black-Scholes option pricing model. No options were granted during 2022. Options granted during 2021 were valued based on the following range and weighted-average assumptions:


	2021
Common stock price (1)	$0.93 - $4.98
Expected term (in years)	6.25
Expected volatility	90.0	%
Risk-free interest rate	0.1	%
Expected dividend yield	—

__________________

(1) The stock price prior to the Merger has been retroactively restated to reflect the exchange ratio of 6.7735 established in the Merger.

Restricted Stock Units

Stock-based compensation expense for awards with only service conditions are recognized on a straight-line basis over the requisite service period of the award. Generally, awards granted under the 2022 plans vest based solely on a service condition. RSUs granted under the 2020 Plan contain both a service-based vesting condition and liquidity event-based vesting condition. The liquidity event-based vesting condition was satisfied upon the closing of the Merger. The service-based vesting period for these awards is generally three or four years, with a ~~Business Combination (excluding~~cliff vesting period of one year, and continue to vest monthly or quarterly thereafter.

During 2022, the Company granted RSUs to its CEO that vest based on a market-based condition. These RSUs will vest and convert to common stock subject to the Company’s stock price reaching certain price targets for 20 days in any ~~shares~~30 day trading window. The fair value of the RSUs will be recognized as expense over the requisite service period regardless of whether or ~~equity-linked securities issued, or~~not the RSUs ultimately vest and convert to common stock. The fair value of these market-based RSUs were measured on their respective grant dates, using a Monte Carlo simulation model based on the following range and weighted-average assumptions:


	2022
Common stock price	$2.93 - $3.10
Expected term (in years)	4.00 - 6.27
Expected volatility	90.0	%
Risk-free interest rate	3.6% - 3.8%
Expected dividend yield	—

As of December 31, 2022, none of the stock price targets have been achieved for the market-based RSUs.

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ENERGY VAULT HOLDINGS, INC.

Notes to Consolidated Financial Statements

RSU activity for the years ended December 31, 2022 and 2021 are as follows (amounts in thousands, except per share data):


	RSUs (1)	Weighted Average Grant Date Fair Value per Share
Nonvested balance as of December 31, 2020	—	$	—
RSUs granted	6,170	2.11


Nonvested balance as of December 31, 2021	6,170	2.11
RSUs granted	23,412	6.31
RSUs forfeited	(561)	5.64
RSUs vested	(5,222)	1.55
Nonvested balance as of December 31, 2022	23,799	5.87

_________________

(1) The number of RSUs prior to the Merger have been retroactively restated to reflect the exchange ratio of 6.7735 established in the Merger.

As of December 31, 2022, unrecognized stock-based compensation expense related to these RSUs was $113.2 million which is expected to be ~~issued,~~recognized over the remaining weighted-average vesting period of approximately 3.01 years.

Unvested Common Stock/Restricted Stock Awards

The Company has certain common stocks that are subject to ~~any seller~~repurchase at the election of the Company. These repurchase rights expire over time and therefore are accounted for as unvested common stock. The Company has RSAs that vest upon the satisfaction of both a service-based condition and a liquidity event-based condition. The liquidity event-based vesting condition was satisfied upon the closing of the Merger.

The following table summarizes information about outstanding unvested stock activities for the years ended December 31, 2022 and 2021 (amounts in ~~a Business Combination, and any private placement-equivalent warrants issued~~thousands):


			Unvested Common Stock (1)
Balances outstanding at December 31, 2020			3,051
New grants or issues			5,655
Common stock vested			(3,040)
Repurchased stock			(146)
Balances outstanding at December 31, 2021			5,520

Common stock vested			(5,520)
Balances outstanding at December 31, 2022			—

_________________

(1) The number of RSAs prior to the ~~Sponsor or its affiliates upon conversion~~Merger have been retroactively restated to reflect the exchange ratio of ~~loans made to~~6.7735 established in the ~~Company).~~

~~NOTE 8 — INCOME TAX~~

~~The Company’s net deferred tax assets (liability) at~~Merger.

Stock-Based Compensation Expense

Total stock-based compensation expense for the years ended December 31, 2022 and 2021 ~~and 2020 are~~is as ~~follows:~~

follows (amounts in thousands):


	Year Ended December 31,
	2022		2021
Sales and marketing	$	5,111	$	67
Research and development	14,775		370
General and administrative	21,172		63
Total stock-based compensation expense	$	41,058	$	500

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December 31,

December 31,

2021

2020
Deferred tax assets




Net operating loss carryforward

$
34,842

$
232
Startup/Organization Expenses

223,983

—
Total deferred tax assets

258,825

232
Valuation Allowance

(258,825)

(232)
Deferred tax assets (liability)

$
—

$
—

ENERGY VAULT HOLDINGS, INC.

~~The income tax provision~~

Notes to Consolidated Financial Statements

Total stock-based compensation expense for the year ended December 31, ~~2021~~2022 includes $7.1 million in expense that was recognized upon the Closing of the Merger, which includes $3.9 million related to RSUs and $3.2 million related to RSAs.

NOTE 16. INCOME TAXES

The components of pre-tax loss are as follows for the ~~period from September 29, 2020 (inception) through~~years ended December 31, ~~2020 consists~~2022 and 2021 (amounts in thousands):


	Year Ended December 31,
	2022		2021
United States	$	(52,509)	$	(12,308)
Switzerland	(25,363)		(19,029)
Total loss before tax	$	(77,872)	$	(31,337)

The following table presents the principal reasons for the difference between the effective tax rate and the federal statutory income tax rate:


	Year Ended December 31,
	2022		2021
US federal statutory income tax rate	21.0	%	21.0	%
State and local income taxes, net of Federal benefit	2.7	%	0.3	%
Non-deductible expenses	(6.5)	%	(0.5)	%
Credits	0.7	%	0.4	%
Foreign rate differential	(0.9)	%	(0.6)	%
Valuation allowance	(17.6)	%	(20.6)	%
Effective income tax rate	(0.6)	%	—	%

The components of the ~~following:~~

December 31,

December 31,

2021

2020
Federal




Current

$
—

$
—
Deferred

(258,593)

(232)

State and Local




Current

—

—
Deferred

—

—

Change in valuation allowance

258,593

232
Income tax provision

$
—

$
—

provision for income taxes are as follows (amounts in thousands):

~~F-18~~


	Year Ended December 31,
	2022		2021
Current
Federal	$	388	$	—
State	39		1
Foreign	—		—
Total current tax provision	427		1
Deferred
Federal	—		—
State	—		—
Foreign	—		—
Total deferred tax provision	—		—
Total provision for income taxes	$	427	$	1

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~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~As of December 31, 2021 and 2020, the Company has a total of $165,916 and $0, respectively, of U.S. federal net operating loss carryovers available~~ENERGY VAULT HOLDINGS, INC.

Notes to ~~offset future taxable income.~~ Condensed Consolidated Financial Statements

The federal net operating loss can be carried forward indefinitely. As of December 31, 2021 and 2020, the Company did not have any state net operating loss carryovers available to offset future taxable income.

~~In assessing the realization~~components of the deferred tax asset are as follows (amounts in thousands):


	December 31,
	2022		2021
Deferred tax assets:
Net operating loss carryforwards	$	12,701	$	10,905
Stock-based compensation	4,143		—
Revenue recognition	1,937		—
Accrued expense	1,324		425
Capitalized research and development	3,492		—
Credits	374		167
Operating lease liabilities	191		228
Other	289		139
Gross deferred tax assets	24,451		11,864
Less: valuation allowance	(24,043)		(11,405)
Net deferred tax assets	408		459
Deferred tax liabilities:
Depreciation and amortization	(229)		(89)
Right of use assets	(179)		(213)
Other	—		(157)
Net deferred tax assets (liabilities)	$	—	$	—

In assessing the realizability of deferred tax assets, ~~management~~the Company considers whether it is more likely than not that some portion ofor all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences ~~representing net future deductible amounts~~ become deductible. ~~Management considers~~Based upon the ~~scheduled reversal~~analysis of federal and state deferred tax balances, future tax projections and availability of taxable income in the carryback period, the Company recorded a valuation allowance against the federal, state, and international deferred tax assets ~~(liabilities)~~of $24.0 million.

As of December 31, 2022, the Company had federal net operating losses of $3.4 million, ~~projected~~state net operating losses of $21.9 million, and foreign net operating losses of $37.3 million available to offset future taxable income. The federal and state net operating loss carryforwards will begin to expire, if unutilized, beginning in 2038. The foreign net operating loss carryforwards will begin to expire, if unutilized, beginning in 2025.

At December 31, 2022, the Company had federal and state research tax credit carryforwards of $0.3 million and $0.3 million, respectively. The federal research tax credit carryforwards will begin to expire, if unutilized, in 2041. The state research tax credits do not expire.

At December 31, 2022 and 2021, the Company recorded $1.1 million, and $0.9 million, respectively, of unrecognized tax benefits. The Company’s policy is to recognize interest and penalties related to uncertain tax positions, if any, in the income tax provision. During the years ended December 31, 2022 and 2021, the Company recognized no interest and penalties related to uncertain tax ~~planning strategies~~positions.

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ENERGY VAULT HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

The following table summarizes the activity related to the Company’s unrecognized tax benefits (amounts in ~~making this assessment. After consideration~~thousands):


	Year Ended December 31,
	2022		2021
Balance at beginning of year	$	908	$	882
Increase related to prior year tax positions	31		13
Decrease related to prior year tax positions	—		(18)
Increase related to current year tax positions	127		31
Decrease related to lapsing status of limitation	—		—
Balance at end of year	$	1,066	$	908

The total amount of ~~all~~unrecognized tax benefits that, if recognized, would affect the effective tax rate as of December 31, 2022 and 2021 was zero, due to the ~~information available, management believes~~valuation allowance that ~~significant uncertainty exists with respect to future realization of~~would otherwise be recorded on the deferred tax ~~assets~~asset associated with the recognized position.

The tax years ended December 31, 2019 through December 31, 2022 remain open to examination by the Internal Revenue Service and California Franchise Tax Board. In addition, the utilization of net operating loss carryforwards are subject to Federal and State review for the periods in which those net losses were incurred. The Company is not under audit by any taxing jurisdictions at this time.

Utilization of the net operating losses and tax credit carryforwards may be subject to an annual limitation based on changes in ownership, as defined by Section 382 and 383 of the Internal Revenue Code (“IRC”) of 1986, as amended. The Company has done a preliminary Section 382 study and has ~~therefore~~determined that none of the net operating losses are currently permanently impaired due to 382 limitations.

The IRA was passed in August 2022, providing significant incentives for businesses to become more energy efficient by extending, increasing, or expanding credits applicable to the production of clean energy and fuels as well as other provisions. These changes do not have a material impact on the Company’s tax provision.

NOTE 17. NET LOSS PER SHARE OF COMMON STOCK

The weighted-average number of shares of common stock outstanding prior to the Merger have been retroactively adjusted by the Exchange Ratio to give effect to the reverse recapitalization treatment of the Merger. Shares of common stock issued as a result of the conversion of Legacy Energy Vault convertible preferred stock in connection with the closing of the Merger have been included in the basic net loss per share calculation on a prospective basis.

Basic and diluted net loss per share attributable to common stockholders are calculated as follows (amounts in thousands, except per share amounts):


	Year Ended December 31,
	2022		2021
Net loss	$	(78,299)	$	(31,338)
Weighted-average shares outstanding – basic and diluted (1)	123,241		12,780
Net loss per share – basic and diluted	$	(0.64)	$	(2.45)

_________________

(1) The weighted-average number of shares prior to the Merger have been retroactively restated to reflect the exchange ratio of 6.7735 established ~~a full valuation allowance. For~~in the ~~year~~Merger.

There are no common stock and convertible preferred stock that were dilutive for the years ended December 31, ~~2021,~~2022 and 2021. Due to net losses during those periods, basic and diluted net loss per common share were the ~~change in~~same, as the ~~valuation allowance was $258,593. For~~effect of potentially dilutive securities would have been anti-dilutive.

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ENERGY VAULT HOLDINGS, INC.

Notes to Condensed Consolidated Financial Statements

The following outstanding balances of common share equivalent securities have been excluded from the ~~period from September 29, 2020 (inception) through December 31, 2020,~~calculation of diluted weighted-average common shares outstanding because the ~~change in the valuation allowance was $232.~~

~~A reconciliation of the federal income tax rate to the Company’s effective tax rate at December 31, 2021 and 2020~~effect is ~~as follows:~~

December 31,

December 31,

2021

2020

Statutory federal income tax rate

21.0
%
21.0
%
State taxes, net of federal tax benefit

0.0
%
0.0
%
Deferred tax liability change in rate

0.0
%
0.0
%
Change in fair value of Warrant Liability

(11.7)
%
—
%
Compensation Expense

0.0
%
—
%
Transaction costs - warrants

(1.5)
%
—
%
Meals and entertainment

0.0
%
0.0
%
Valuation allowance

(7.8)
%
(21.0)
%
Income tax provision

0.0
%
0.0
%

~~The Company’s effective tax rates~~anti-dilutive for the periods presented ~~differ~~(amounts in thousands):


	Year Ended December 31,
	2022	2021
Private Warrants	5,167	—
Stock options	1,093	1,345
Convertible preferred stock	—	85,741
RSUs	23,799	—

Total	30,059	87,086

The 9.0 million shares of common stock equivalents subject to the Earn-Out Shares are excluded from the ~~expected (statutory) rates due~~anti-dilutive table above as of December 31, 2022, as the underlying shares remain contingently issuable as the Earn-Out Triggering Events have not been satisfied.

NOTE 18. COMMITMENTS AND CONTINGENCIES

In connection with the Company’s licensing agreement with Atlas, the Company agreed to ~~changes~~make a refundable contribution to Atlas in ~~fair value~~the amount up to $25.0 million during the period in ~~warrants, transaction costs associated with warrants~~which Atlas constructs its first GESS. As of December 31, 2022, the Company has contributed all $25.0 million. The refundable contribution will be returned to the Company upon Atlas’ first GESS reaching substantial completion, subject to adjustment for potential liquidated damages if certain performance metrics are not met.

Other Commitments and Contingencies

Letters of Credit: In the ~~recording~~ordinary course of ~~full valuation allowances on deferred tax assets.~~

business and under certain contracts, the Company is required to post letters of credit for its customers, insurance carriers, and surety bond providers for project performance, and for its vendors for payment guarantees. Such letters of credit are generally issued by a bank or a similar financial institution. The letter of credit commits the issuer to pay specified amounts to the holder of the letter of credit under certain conditions. As of December 31, 2022, there was $82.9 million of letters of credit issued and secured by the Company’s cash. The Company ~~files income tax returns~~is not aware of any material claims relating to its outstanding letters of credit.

Performance and Payment Bonds: In the ordinary course of business, Energy Vault is required by certain customers to provide performance and payment bonds for contractual commitments related to its projects. These bonds provide a guarantee that the Company will perform under the terms of a contract and that the Company will pay its subcontractors and vendors. If the Company fails to perform under a contract or to pay its subcontractors and vendors, the customer may demand that the surety make payments or provide services under the bond. The Company must reimburse the surety for expenses or outlays it incurs. As of December 31, 2022, there were no outstanding performance and payment bonds.

NOTE 19. SUBSEQUENT EVENTS

On February 28, 2023, the Company purchased $6.0 million in equity securities of a private company active in the ~~U.S. federal jurisdiction and is subject to examination by~~energy transition industry. After this investment, the various taxing authorities. The Company’s tax returns for the year ended December 31, 2021 and 2020 remain open and subject to examination. The Company considers Indianapolis to be a significant state tax jurisdiction.

~~NOTE 9. FAIR VALUE MEASUREMENTS~~

The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.

~~The fair~~carrying value of the Company’s investment in this private company totaled $15.0 million.

On March 10, 2023, the Federal Deposit Insurance Corporation (“FDIC”) announced that it has closed and taken control of Silicon Valley Bank (“SVB”). On March 13, 2023, pursuant to a joint statement released by the U.S. Department of the Treasury, the U.S. Federal Reserve, and the FDIC, the U.S. government reassured that all depositors will be fully protected. In light of the situation, the Company has moved substantially all cash and other deposits previously held at SVB to larger financial ~~assets~~institutions. The Company does not anticipate any disruptions to its ongoing operations.

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Item 9. Changes in and ~~liabilities reflects management’s estimate~~Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

Evaluation of ~~amounts~~Disclosure Controls and Procedures

Disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed by us in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

As part of the filing of this Form 10-K for the period ended December 31, 2022, our management, with the participation of our Chief Executive Officer ("CEO”) and Chief Financial Officer (“CFO”), 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 Securities Exchange Act of 1934, as amended (the "Exchange Act”). As a result of this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were not effective due to the material weakness described below.

Limitations on the Effectiveness of Controls

The effectiveness of any system of disclosure controls and procedures and internal control over financial reporting, including ours, is subject to inherent limitations, including the exercise of judgment in designing, implementing, operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely. Accordingly, in designing and evaluating the disclosure controls and procedures, management recognizes that any system of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable assurance, not absolute assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the ~~Company~~degree of compliance with the policies or procedures may deteriorate. We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting for future periods. Because of its inherit limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act). Internal control over financial reporting means a process designed by, or under the supervision of, a company’s principal executive and principal financial officers, and effected by the company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company, (ii) provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the company are being made only in accordance with authorizations of the company’s management and directors, and (iii) provide reasonable assurance regarding the prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have ~~received~~a material effect on the company’s financial statements.

Management, with the participation of our CEO and CFO, evaluated the effectiveness of our internal control over financial reporting as of December 31, 2022. This evaluation was conducted using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in the 2013 Internal Control – Integrated Framework. Based on this evaluation, management identified a material weakness in our internal control over financial reporting existed relating to the recognition of revenue from certain licensing contracts. Specifically, in connection with one of our licensing contracts, we did not implement effective background check controls for an international customers’ ability to pay in order to properly assess the probability that we will collect substantially all of the consideration to which we are entitled.

Table of Contents

A material weakness is a deficiency or a combination of deficiencies, in a company’s internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Remediation Plan

We have commenced measures to remediate the identified material weakness by further developing and implementing formal policies, processes, and documentation procedures relating to financial reporting. We believe the steps taken to date and those planned for future implementation will improve the effectiveness of our internal control over financial reporting, although we have not yet completed all remediation efforts. The material weakness cannot be considered remediated until applicable controls have operated for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control Over Financial Reporting

During the quarter ended December 31, 2022, management completed several changes to its internal control over financial reporting and remediated the previously reported material weaknesses. The following internal control changes were made to the Company’s internal control over financial reporting:

•Hired additional accounting and financial reporting personnel to execute internal controls with appropriate technical accounting knowledge and public company experience in financial reporting;

•Designed and implemented effective processes and controls relating to financial reporting and the adoption of new technological solutions; and

•Engaged an accounting advisory firm to assist with the documentation, evaluation, remediation, and testing of the Company’s internal control over financial reporting based on the criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Except as otherwise described herein, there were no changes in our internal control over financial reporting identified in connection with the ~~sale~~evaluation required by Rule 13a-15(d) and 15d-15(d) of the ~~assets~~Exchange Act that occurred during the period covered by this Annual Report on Form 10-K that have materially affected, or ~~paid~~are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

None.

Table of Contents

Part III

Item 10. Directors, Executive Officers and Corporate Governance

The information required by this Item will be included in the Company’s Proxy Statement to be filed with the SEC within 120 days after December 31, 2022 in connection with the ~~transfer~~solicitation of proxies for the ~~liabilities~~Company’s 2023 annual meeting of stockholders, and is incorporated herein by reference.

Item 11. Executive Compensation

The information required by this Item will be included in ~~an orderly transaction between market participants at~~ the ~~measurement date. In connection~~Company’s Proxy Statement to be filed with ~~measuring~~ the ~~fair value~~SEC within 120 days after December 31, 2022, and is incorporated herein by reference.

Item 12. Security Ownership of ~~its assets~~Certain Beneficial Owner and ~~liabilities,~~Management and Related Stockholder Matters

The information required by this Item will be included in the ~~Company seeks~~Company’s Proxy Statement to ~~maximize~~be filed with the ~~use~~SEC within 120 days after December 31, 2022, and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this Item will be included in the Company’s Proxy Statement to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

The information required by this Item will be included in the Company’s Proxy Statement to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference.

Table of ~~observable inputs (market data obtained from independent sources)~~Contents

Part IV

Item 15. Exhibits and Financial Statement Schedules

(a)(1) The financial statements filed as part of this Annual Report are listed in Item 8 of this Annual Report

(a)(2) No financial statement schedules are required to ~~minimize the use~~be filed as part of ~~unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based~~this Annual Report because all such schedules have been omitted. Such omission has been made on the ~~observable inputs~~basis that information provided in the financial statements, or in the related notes thereto, in Item 8 of this Annual Report or is not required to be filed as the information is not applicable.

(a)(3) The exhibits listed on the Exhibit Index to this Annual Report are incorporated herein by reference.

Exhibit Index

Exhibit
Number

Incorporated by Reference

Description of Document

Schedule/Form

File Number

Exhibit Number

Filing Date

3.1

Amended and Restated Bylaws of Energy Vault Holdings, Inc.

8-K

001-39982

3.1

February 14, 2022

3.2

Amended and Restated Certificate of Incorporation of Energy Vault Holdings, Inc.

8-K

001-39982

3.2

February 14, 2022

10.1

Amended and Restated Registration Rights Agreement, by and among the Company and certain stockholders and equity-holders of the Company

8-K

001-39982

10.2

February 14, 2022

10.2

Sponsor Restricted Stock Agreement by and among Novus, Novus Initial Stockholders, and Energy Vault

8-K

001-39982

10.5

February 14, 2022

10.3#

Offer Letter, dated May 16, 2022, by and between Energy Vault Holdings, Inc. and Josh McMorrow

10-Q

001-39982

10.7

May 16, 2022

10.4#

Offer Letter, dated November 11, 2022, by and between Energy Vault Holdings, Inc. and Robert Piconi

10-Q

001-39982

10.1

November 14, 2022

10.5#

Offer Letter, dated November 14, 2022, by and between Energy Vault Holdings, Inc. and Jan Kees Van Gaalen

10-Q

001-39982

10.2

November 14, 2022

10.6#

Offer Letter, dated November 10, 2022, by and between Energy Vault Holdings, Inc. and Energy Terruzzin

10-Q

001-39982

10.3

November 14, 2022

10.7#

Amendment to the Energy Storage System Agreement by and between DG Fuels LLC and Energy Vault Inc., dated as of May 10, 2022

10-Q

001-39982

10.6

May 16, 2022

10.8#

Energy Vault Holdings, Inc. 2022 Equity Incentive Plan

10-Q

001-39982

10.4

May 16, 2022

10.9#

2022 Employment Inducement Award Plan

10-Q

001-39982

10.5

November 14, 2022

10.10#

Form of Stock Option Grant Notice and Stock Option Agreement under the 2022 Employment Inducement Award Plan

10-Q

001-39982

10.6

November 14, 2022

10.11#

Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2022 Employment Inducement Award Plan

10-Q

001-39982

10.7

November 14, 2022

10.12#

Form of Stock Option Grant Notice and Stock Option Agreement under the 2022 Equity Incentive Plan

10-Q

001-39982

10.8

November 14, 2022

10.13#

Form of Restricted Stock Unit Award Grant Notice and Restricted Stock Unit Award Agreement under the 2022 Equity Incentive Plan

10-Q

001-39982

10.9

November 14, 2022

10.14**

Non-Employee Director Compensation Policy

Table of Contents

Exhibit
Number

Incorporated by Reference

Description of Document

Schedule/Form

File Number

Exhibit Number

Filing Date

21.1**

List of Subsidiaries of Energy Vault Holdings, Inc.

23.1**

Consent of Independent Registered Public Company Accounting Firm

31.1**

Certification of Principal Executive Officer required under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended

31.2**

Certification of Chief Financial Officer required under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended

32.1**

Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2**

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS**

XBRL Instance Document

101.CAL**

XBRL Taxonomy Extension Calculation Linkbase Document

101.SCH**

XBRL Taxonomy Extension Schema Document

101.DEF**

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB**

XBRL Taxonomy Extension Labels Linkbase Document

101.PRE**

XBRL Taxonomy Extension Presentation Linkbase Document

104**

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

_____________________

# Indicates management contract or compensatory plan or arrangement.

** Filed herewith

^ The certifications attached as Exhibit 32.1 and ~~unobservable inputs used in order to value the assets and liabilities:~~

~~Level 1:~~Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information32.2 that accompany this Annual Report on ~~an ongoing basis.~~

~~Level 2:~~Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets thatForm 10-K are not ~~active.~~

deemed filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filings of Energy Vault Holdings, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Annual Report on Form 10-K, irrespective of any general incorporation language contained in such filing.

~~F-19~~

Item 16. Form 10-K Summary

None.

100

Table of Contents

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~Level 3:Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.~~

The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. At December 31, 2020 there were no assets or liabilities that were measured at fair value.

Significant

Significant

Quoted Prices

Other

Other

in Active

Observable

Unobservable

Markets

Inputs

Inputs
Description

December 31, 2021

(Level 1)

(Level 2)

(Level 3)
Assets:

Marketable securities held in Trust Account

$
287,515,823

$
287,515,823

$
—

$
—

Liabilities:

Warrant Liability – Public Warrants

$
11,979,166

$
11,979,166

$
—

$
—

Warrant Liability – Private Placement Warrants

$
6,458,333

$
—

$
—

$
6,458,333

Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period in which a change in valuation technique or methodology occurs. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 measurement during the year ended December 31, 2021.

The Warrants are measured at fair value on a recurring basis. The Public Warrants were initially valued using a Modified Monte Carlo Simulation. As of December 31, 2021, the Public Warrants were valued using the instrument’s publicly listed trading price as of the consolidated balance sheet date, which is considered to be a Level 1 measurement due to the use of an observable market quote in an active market.

The Private Placement Warrants were valued using a Modified Black-Scholes Option Pricing Model, which is considered to be a Level 3 fair value measurement. The primary unobservable input utilized in determining the fair value of the Private Placement Warrants is the expected volatility of our common stock. The expected volatility of the Company’s common stock was determined based on the implied volatility of the Public Warrants.

~~The key inputs into the Modified Montel Carlo Simulation and the Modified Black-Scholes Option Pricing model for Warrants were as follows:~~

February 8, 2021

December 31,

Initial Measurement

2021

Public

Private

Private

Input

Warrants

Warrants

Warrants

Risk-free interest rate

0.48
%

0.48
%

1.26
%
Expected term (years)

5.00

5.00

5.00

Expected volatility

21.0
%

21.0
%

18.12
%
Exercise price

$
11.50

$
11.50

$
11.50

Stock Price

$
10.00

$
10.00

$
9.90

~~F-20~~

Signatures

~~Table of Contents~~

~~NOVUS CAPITAL CORPORATION II~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~The following table presents the changes in the fair value of Level 3 warrant liabilities:~~

Private

Warrant


Placement

Public

Liabilities

Fair value as of January 1, 2021

$
—

$
—

$
—

Initial measurement on February 8, 2021

5,838,333

10,733,333

16,571,666

Change in fair value

620,000

1,245,833

1,865,833

Transfer to Level 1

—

(11,979,166)

(11,979,166)

Fair value as of December 31, 2021

$
6,458,333

$
—

$
6,458,333

Transfers to/from Levels 1, 2 and 3 are recognized at the end of the reporting period in which a change in valuation technique or methodology occurs. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 fair value measurement during the year ended December 31, 2021 was $11,979,166.

~~NOTE 10. SUBSEQUENT EVENTS~~

The Company evaluated subsequent events and transactions that occurred after the consolidated balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, the Company did not identify any subsequent events, other than noted below, that would have required adjustment or disclosure in the consolidated financial statements.

On January 29, 2022, the Company entered into a Subscription Agreement with the Subscriber, pursuant to which the Subscriber agreed to purchase, and the Company agreed to sell the Subscriber, 5,000,000 shares of Class A common stock, par value of $0.0001 per share (the “Additional Pipe Shares”), for a purchase price of $10.00 per share and an aggregate purchase price of $50,000,000 in a private placement. Pursuant to the Subscription Agreement, the Additional PIPE Shares will be sold upon the same terms and conditions as those set forth in those certain Subscription Agreements entered into between the Company and certain other investors on September 8, 2021 in connection with the executionrequirements of Section 13 or 15(d) of the ~~Business Combination Agreement among~~Securities Act of 1934, the ~~Company,~~registrant has duly caused this report to be signed on its behalf by the ~~Merger Sub and Energy Vault. The closing~~undersigned thereunto duly authorized.


	Energy Vault Holdings, Inc.

Date: April 12, 2023	By:	/s/ Jan Kees van Gaalen
		Name: Jan Kees van Gaalen
		Title: Chief Financial Officer

Pursuant to the requirements of the ~~sale~~Securities Act of 1934, this report has been signed below by the following persons on behalf of the ~~Additional PIPE Shares pursuant to~~registrant and in the ~~Subscription Agreement is contingent upon, among other customary closing conditions,~~capacities and on the concurrent consummation of the Proposed Transactions. The purpose of the sale of the Additional PIPE Shares is to raise additional capital for use by the combined company following the closing of the Proposed Transactions.

dates indicated:

~~F-21~~


Date: April 12, 2023	By:	/s/ Robert Piconi
		Name: Robert Piconi
		Title: Chief Executive Officer (Principal Executive Officer)

Date: April 12, 2023	By:	/s/ Jan Kees van Gaalen
		Name: Jan Kees van Gaalen
		Title: Chief Financial Officer (Principal Financial and Accounting Officer)

Date: April 12, 2023	By:	/s/ Larry M. Paulson
		Name: Larry M. Paulson
		Title: Director

Date: April 12, 2023	By:	/s/ Theresa Fariello
		Name: Theresa Fariello
		Title: Director

Date: April 12, 2023	By:	/s/ Bill Gross
		Name: Bill Gross
		Title: Director

Date: April 12, 2023	By:	/s/ Zia Huque
		Name: Zia Huque
		Title: Director

Date: April 12, 2023	By:	/s/ Thomas Ertel
		Name: Thomas Ertel
		Title: Director

Date: April 12, 2023	By:	/s/ Mary Beth Mandanas
		Name: Mary Beth Mandanas
		Title: Director

101


Title of each class			Trading Symbol(s)		~~Trading~~ ~~Symbol(s)~~		Name of each exchangeon which registered
~~Units, each consisting of one share of common stock and one-third of one redeemable warrant~~				~~NXU.U~~	~~New York~~Common Stock, ~~Exchange~~
~~Class A common stock~~ par value $0.0001 per share	NRGV			~~NXU~~		New York Stock Exchange
~~Redeemable warrants, exercisable for shares of common stock at an exercise price of $11.50 per share~~		~~NXU.WS~~		~~New York Stock Exchange~~


		~~Whether Stockholder~~
~~Type of Transaction~~		~~Approval is~~
~~Purchase of assets~~		No

~~Purchase of stock of target not involving a merger with the company~~		No

~~Merger of target into a subsidiary of the company~~		No

~~Merger of the company with a target~~		~~Yes~~


x			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		~~Page~~
~~PART I~~					Page
Cautionary Note Regarding Forward-Looking Statements					3

Part I
Item 1.			Business		1 4
Item 1A.			Risk Factors		14 12
Item ~~1B.~~1B			Unresolved Staff Comments		41
Item 2.			Properties		41 42
Item 3.			Legal Proceedings		42
Item 4.			Mine Safety Disclosures		42

~~PART~~Part II

Item 5.	Market for ~~the~~ Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			43
Item 6.			~~Selected Financial Data~~[Reserved]		44 43
Item 7.			~~Management’s~~Management's Discussion and Analysis of ~~Plan of Operation~~Financial Condition and Results of Operations		44 43
Item 7A.			Quantitative and Qualitative Disclosures About Market Risk		47 57
Item 8.			Financial Statements and Supplementary Data		47 59
Item 9.			Changes inIn and Disagreements with Accountants on Accounting and Financial ~~Disclosure~~Disclosures		47 96
Item 9A.			Controls and Procedures		48 96
Item 9B.			Other Information		48 97

~~PART~~Part III

Item 10.	Directors, Executive Officers ~~Promoters~~ and Corporate ~~Governance.~~Governance			49 98
Item 11.			Executive Compensation		57 98
Item 12.			Security Ownership of Certain Beneficial ~~Owners~~Owner and Management and Related Stockholder Matters		58 98
Item 13.			Certain Relationships and Related Transactions, and Director Independence		59 98
Item 14.			Principal ~~Accountant~~Accounting Fees and Services		64 98

~~PART~~Part IV

Item 15.	Exhibits and Financial Statement Schedules			64 99
Item 16.			Form 10-K Summary		100
~~SIGNATURES~~					68
Signatures					101



	Number of
	Shares of Novus
Name and Address of Beneficial Owner (1)	Common Stock	%
Directors and Executive Officers of Novus:
Robert J. Laikin (2)(3)	1,911,111		5.3	%
Hersch Klaff (4)	1,298,828		3.6	%
Larry M. Paulson (5)	966,146		2.7	%
Vincent Donargo (3)(6)	1,475,694		4.1	%
Jeffrey Foster (7)	966,146		2.7	%
Heather Goodman	291,667		*
Ronald Sznaider	182,292		*
All Directors and Executive Officers of Novus as a Group (5 Individuals)	5,980,773		16.6	%
Five Percent Holders of Novus:
Highbridge Capital management LLC (8)	1,705,105		4.7	%
Adage Capital Advisors, L.L.C. (Adage Capital Partners, L.P.) (9)	1,500,000		4.2	%
Citadel Advisors LLC (10)	1,576,535		4.4	%


		Incorporated by Reference
Exhibit Number	Description of Document	Schedule/Form	File Number	Exhibits	Filing Date
2.1*	Business Combination Agreement and Plan of Reorganization, dated September 8, 2021, by and among Novus, Merger Sub and Energy Vault (included as Annex A to this proxy statement/prospectus)	Form 8-K	001-39982	2.1	September 9, 2021

3.1	Certificate of Incorporation of Novus	Form S-1	333-252079	3.1	January 13, 2021

3.2	Amended and Restated Certificate of Incorporation of Novus	Form 8-K	001-39982	3.1	February 8, 2021

3.3	Bylaws of Novus	Form S-1	333-252079	3.3	January 13, 2021

3.4	Form of Amended and Restated Certificate of Incorporation of Combined Company (included as Annex B to this proxy statement/prospectus)	Form 8-K	001-39982	2.1	September 9, 2021

3.5	Form of Amended and Restated Bylaws of Combined Company (included in Exhibit 2.1)	Form 8-K	001-39982	2.1	September 9, 2021

4.1	Specimen Unit Certificate of Novus	Form S-1	333-252079	4.1	January 13, 2021

4.2	Specimen Class A Common Stock Certificate of Novus	Form S-1	333-252079	4.2	January 13, 2021

4.3	Specimen Warrant Certificate of Novus	Form S-1	333-252079	4.3	January 13, 2021

4.4	Warrant Agreement, dated February 3, 2021, by and between Continental Stock Transfer & Trust Company and Novus	Form 8-K	001-39982	4.1	February 8, 2021

10.1	Business Combination Marketing Agreement, dated February 3, 2021, between Novus and Cowen	Form 8-K	001-39982	1.2	February 8, 2021

10.2	Investment Management Trust Agreement, dated February 3, 2021, by and between Continental Stock Transfer & Trust Company and Novus	Form 8-K	001-39982	10.2	February 8, 2021

10.3	Registration Rights Agreement, dated February 3, 2021, by and among Novus and certain stockholders	Form 8-K	001-39982	10.3	February 8, 2021

10.4	Form of Amended and Restated Registration Rights Agreement, by and among Novus, Novus Initial Stockholders and New Holders (included in Exhibit 2.1)	Form 8-K	001-39982	2.1	September 9, 2021

10.5	Form of Promissory Note of Novus	Form S-1	333-252079	10.1	January 13, 2021

10.6	Stockholder Support Agreement, dated September 8, 2021, by and among Novus and certain stockholders	Form 8-K	001-39982	10.1	September 9, 2021

10.7	Sponsor Support Agreement, dated as of September 8, 2021, by and among Novus and the Initial Stockholders	Form 8-K	001-39982	10.2	September 9, 2021

10.8	Form of PIPE Subscription Agreement	Form 8-K	001-39982	10.3	September 9, 2021

10.9	Warrant Subscription Agreement, dated February 2, 2021, by and between Novus and NCCII	Form S-1	333-252079	10.7	January 13, 2021

10.10	Form of Letter Agreement from Novus’s officers and directors and other initial stockholders	Form S-1	333-252079	10.2	January 13, 2021

10.11	Form of Lock-Up Agreement (included in Exhibit 2.1)	Form 8-K	001-39982	2.1	September 9, 2021

10.12	Form of Amended and Restated Sponsor Restricted Stock Agreement, by and among Novus, Novus Initial Stockholders and Energy Vault (included in Annex A to this proxy statement/prospectus)	Form S-4	333-260307	10.12	December 30, 2021

23.1	Consent of Marcum LLP, independent registered public accounting firm of Novus

24.1	Power of Attorney (included on the signature page to this Form 10-K)*

101.INS	Inline XBRL Instance Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document


	December 31,
	2021		2020
ASSETS
Current assets
Cash	$	396,295	$	172,854
Prepaid expenses		114,583		—
Total Current Assets		510,878		172,854

Deferred offering costs		—		37,042
Marketable securities held in Trust Account		287,515,823		—
TOTAL ASSETS	$	288,026,701	$	209,896

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
Current liabilities
Accrued expenses	$	208,913	$	1,000
Accrued offering costs		—		25,000
Promissory note — related party		—		160,000
Total Current Liabilities		208,913		186,000

Warrant liability		18,437,499		—
TOTAL LIABILITIES		18,646,412		186,000

Commitments and Contingencies

Class A common stock subject to possible redemption 28,750,000 and 0 shares at redemption value at December 31, 2021 and 2020, respectively		287,500,000		—

Stockholders’ (Deficit) Equity
Preferred stock, $0.0001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding		—		—
Class B common stock, $0.0001 par value; 20,000,000 shares authorized; 7,187,500 shares issued and outstanding, at December 31, 2021 and 2020		719		719
Additional paid-in capital		—		24,281
Accumulated deficit		(18,120,430)		(1,104)
Total Stockholders’ (Deficit) Equity		(18,119,711)		23,896
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	288,026,701	$	209,896


			For the Period from
			September 29, 2020
	Year Ended		(Inception) Through
	December 31,		December 31,
	2021		2020
Operating and formation costs	$	1,247,217	$	1,104
Loss from operations		(1,247,217)		(1,104)

Other income (expense):
Interest earned on marketable securities held in Trust Account		15,823		—
Transaction costs incurred in connection with warrants		(241,311)		—
Change in fair value of warrants		(1,865,833)		—
Total other expense, net		(2,091,321)		—

Net loss	$	(3,338,538)	$	(1,104)


Basic and diluted weighted average shares outstanding, Class A common stock		25,678,082		—
Basic and diluted net loss per share, Class A common stock	$	(0.10)	$	—
Basic and diluted weighted average shares outstanding, Class B common stock		7,087,329		6,250,000
Basic and diluted net loss per share, Class B common stock	$	(0.10)	$	—


	Class A			Class B			Additional				Total
	Common Stock			Common Stock			Paid-in		Accumulated		Stockholders’
	Shares	Amount		Shares	Amount		Capital		Deficit		Equity (Deficit)
Balance — September 29, 2020 (Inception)	0		0	0		0		0		0		0

Issuance of Class B Common Stock to Sponsor	—	$	—	7,187,500	$	719	$	24,281	$	—	$	25,000

Net loss	—		—	—		—		—		(1,104)		(1,104)

Balance – December 31, 2020	—	$	—	7,187,500	$	719	$	24,281	$	(1,104)	$	23,896

Remeasurement adjustment on redeemable common stock	—		—	—		—		(1,935,948)		(14,780,788)		(16,716,736)

Cash paid in excess of private warrants	—		—	—		—		1,911,667		—		1,911,667
			—
Net loss	—		—	—		—		—		(3,338,538)		(3,338,538)

Balance – December 31, 2021	—	$	—	7,187,500	$	719	$	—	$	(18,120,430)	$	(18,119,711)



Gross proceeds	$	287,500,000
Less:
Proceeds allocated to Public Warrants	$	(10,733,333)
Issuance costs allocated to Class A common stock		(5,983,403)
Plus:
Remeasurement adjustment on redeemable common stock	$	16,716,736

Class A common stock subject to possible redemption	$	287,500,000


					Significant		Significant
			Quoted Prices		Other		Other
			in Active		Observable		Unobservable
			Markets		Inputs		Inputs
Description	December 31, 2021		(Level 1)		(Level 2)		(Level 3)
Assets:
Marketable securities held in Trust Account	$	287,515,823	$	287,515,823	$	—	$	—

Liabilities:
Warrant Liability – Public Warrants	$	11,979,166	$	11,979,166	$	—	$	—

Warrant Liability – Private Placement Warrants	$	6,458,333	$	—	$	—	$	6,458,333


	February 8, 2021						December 31,
	Initial Measurement						2021
	Public			Private			Private
Input	Warrants			Warrants			Warrants
Risk-free interest rate		0.48	%		0.48	%		1.26	%
Expected term (years)		5.00			5.00			5.00
Expected volatility		21.0	%		21.0	%		18.12	%
Exercise price	$	11.50		$	11.50		$	11.50
Stock Price	$	10.00		$	10.00		$	9.90


	Private				Warrant
	Placement		Public		Liabilities
Fair value as of January 1, 2021	$	—	$	—	$	—
Initial measurement on February 8, 2021		5,838,333		10,733,333		16,571,666
Change in fair value		620,000		1,245,833		1,865,833
Transfer to Level 1		—		(11,979,166)		(11,979,166)
Fair value as of December 31, 2021	$	6,458,333	$	—	$	6,458,333

~~Delaware~~

~~85-3230987~~

Delaware

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification No.)

4360 Park Terrace Drive, Suite 100
Westlake Village, California

~~8556 Oakmont Lane~~
~~Indianapolis~~, IN

~~46260~~

(Address of ~~principal executive offices)~~
Principal Executive Offices)

(Zip Code)