| Subsequent Events | 7. Subsequent Events The Company has evaluated all event or transactions
that occurred after September 30, 2022 through November 6, 2022, which is the date that the condensed financial statements were available
to be issued. During this period, there were no material subsequent events requiring recognition or disclosure, other than those discussed
below. On October 7, 2022, the Company signed a
two-year lease agreement, on a warehouse facility to begin building out our prototype boats. The monthly rent will be $ 6,600 6,798
ITEM 2. You should read the following discussion
and analysis of our financial condition and results of operations together with our financial statements and related notes included in
this Quarterly Report on Form 10-Q. The following discussion contains forward-looking statements that involve risks and uncertainties.
This discussion may contain forward-looking statements that involve risks and uncertainties. See “Forward-Looking Statements.”
Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements
as a result of certain factors, including those discussed below and elsewhere in this Quarterly Report on Form 10-Q. This discussion should
be read in conjunction with the accompanying unaudited condensed financial statements and notes thereto. You should also review the disclosure
under the heading “Risk Factors” in this Quarterly Report on Form 10-Q for a discussion of important factors that could cause
our actual results to differ materially from those anticipated in these forward-looking statements. Overview Forza X1 Business Forza X1, Inc. aims to be among the first
to develop and manufacture electric boats targeting the recreational market. Our mission is to inspire the adoption of sustainable recreational
boating by producing stylish electric sport boats. We are focused on the creation and implementation of marine electric vehicle (“EV”)
technology to control and power our electric boats utilizing our proprietary outboard electric motor. Our electric boats are being designed
as fully integrated electric boats including the hull, outboard motor and control system. To date, we have completed the design of
the 25-foot FX1 dual console model, including hull, deck and small parts. This design has gone from an intellectual concept in CAD to
fiberglass and foam plugs, fiberglass molds and, finally, working boat parts in just over one year. On October the 28 th We believe that the boating industry will
follow in the footsteps of the electrification of the automotive industry by creating electric boats that meet or exceed the traditional
boating consumer’s expectations of price, value and run times. In other words, electric boats must offer a similar experience when
compared to traditional gas-powered boats in terms of size, capability and price point. Our initial two models, the FX1 Dual Console
and FX1 Center Console, are being designed to be 25-foot in length, have an 8’ beam or width and utilize a catamaran hull surface
to reduce drag and increase run times. The initial launch of FX1 will include our proprietary designed single electric outboard motor.
Both FX1 models will have high-powered, liquid-cooled battery packs and a vehicle control unit with our proprietary control software all
integrated into a 22-inch master control touch screen that will be used to control most functions of the boat. We have also filed three
design and four utility patent applications with the U.S. Patent and Trademark Office relating to, among other things, our propulsion
system being developed and boat design. We plan to operate in a fundamentally different
manner and structure than traditional marine manufacturers and boat dealers by adopting a direct-to-consumer sales model. We are building
a dedicated web and app-based platform for sales, deliveries, and service operations to change the personal boat buying and marine service
experience through technological innovation, ease of use, and flexibility. We intend to employ an integrated, digital-first strategy that
is convenient and transparent for our customers and efficient and scalable to support our growth. We believe our approach will enable
us to operate more cost-effectively, provide a better customer experience and incorporate customer feedback more quickly into our product
development and manufacturing processes. We believe this strategy will allow us to deliver uncompromised and premium experiences well
beyond what is available through the standard dealership model. Results of Operations and Known Trends
or Future Events The accompanying financial data includes
the historical accounts of Forza X1, Inc. and its predecessor, the carve-out of the electric segment business of Twin Vee. Forza is in
the business of design and development of electric boats. Forza has a December 31 st Forza succeeded to substantially all of the
business of the electric segment of Twin Vee and Forza’s own operations before the succession, October 15, 2021, were non-existent.
Accordingly, the carve-out financial statements of the electric segment of Twin Vee are included as Predecessor herein. Management has
reached this conclusion based upon an evaluation of the requirements and the facts and circumstances, including the historical life of
the electric segment, the historical level of operations of the electric segment, and the fact that Forza’s operations, prior to
the succession were non-existent. To date much of our operational activity
has been related to the design and build of prototype, as such we do not have any sales or cost of goods sold. The design of our new electric
boat shell has been completed and we are now preparing to begin our production process by securing molds for the FX1 line. The design
on the control system, has been completed, and we are now in the testing phase. To date we have not generated any revenues. Other than
designing and building the prototype our only other activities for the three and nine months ended September 30, 2022 and 2021, periods
October 15, 2021 through December 31, 2021 (Successor), January 1, 2021 through October 14, 2021 (Predecessor), and year ended December
31, 2020 (Predecessor), have been organizational and activities and those necessary to prepare for our initial public offering. We do
not expect to generate any operating revenues until we complete the design and build of our EV boats and commercialize them. We will generate
non-operating income in the form of interest income on cash and cash equivalents until such time as we generate operating revenue.
We expect to incur increased expenses after the closing of the IPO as a result of being a public company (for legal, financial reporting,
accounting and auditing compliance). In addition, we expect our expenses to increase substantially for expenses associated with building
a new manufacturing facility. Results of Operations Comparison of the Three Months Ended September 30, 2022
and 2021 The following table provides certain selected financial information
for the periods presented:
Successor Company Three Months Ended September 30, Predecessor Company Three Months Ended September 30,
2022 2021 Change % Change
Net sales $ — $ — — —
Cost of products sold $ 66,543 $ — 66,543 —
Gross loss $ (66,543 ) $ — (66,543 ) —
Operating expenses $ 979,585 $ 82,230 897,355 1,091 %
Loss from operations $ (1,046,128 ) $ (82,230 ) (963,898 ) 1,172 %
Other income (expense) $ 3,465 $ (3,291 ) 6,756 (205 %)
Net loss $ (1,042,663 ) $ (85,521 ) (957,142 ) 1,119 %
Net loss per common share: Basic and Diluted $ (0.12 ) $ (0.01 ) (0.11 ) 866 %
Weighted average number of common shares outstanding: Basic and diluted 8,837,470 7,000,000 Operating Expenses Operating expenses for the quarter ended
September 30, 2022 increased by $897,355 to $979,585 (Successor) as compared to $82,230 (Predecessor) for the quarter ended September
30, 2021. Operating expenses include salaries, selling and general and administrative, research and development, professional fees and
depreciation. Research and development fees for the quarter ended September 30, 2022 were $283,936 (Successor) compared to $61,091 (Predecessor)
for the quarter ended September 30, 2021. Salaries and wages for the quarter ended September 30, 2022 were $515,833 (Successor) compared
to $0 (Predecessor) for the quarter ended September 30, 2021, and were related to the design of our fully electric motor, control system
and boat. For the quarter ended September 30, 2022 salaries and wages included $158,705 (Successor) of stock option expense, compared
to $0 (Predecessor) for the quarter ended September 30, 2021. Our expenses for selling, general and administrative for quarters ended
September 30, 2022, were $125,851 (Successor) and $21,006 (Predecessor) for the quarter ended September 30, 2021. Professional fees for
the quarter ended September 30, 2022 were $35,221 (Successor), and $0 (Predecessor) for the quarter ended September 30, 2021. Depreciation
for the quarter ended September 30, 2022 was $18,744 (Successor) compared to $133 (Predecessor) for the quarter ended September 30, 2022,
this is due to the addition of assets throughout 2022, we would anticipate continued increases as we purchase equipment and molds. Other expense and income Interest expense was $1,112 and $3,291, respectively
for the quarter ended September 30, 2022 (Successor) and 2021 (Predecessor). Interest income was $4,577 and $0, respectively
for the quarter ended September 30, 2022 (Successor) and 2021 (Predecessor). Comparison of the Nine Months Ended September 30, 2022 and
2021 The following table provides certain selected financial information
for the periods presented:
Successor Company Nine Months Ended September 30, Predecessor Company Nine Months Ended September 30,
2022 2021 Change % Change
Net sales $ — $ — — —
Cost of products sold $ 90,633 $ — 90,633 —
Gross (loss) profit $ (90,633 ) $ — (90,633 ) —
Operating expenses $ 2,089,661 $ 117,330 1,972,331 1,681 %
Loss from operations $ (2,180,294 ) $ (117,330 ) (2,062,964 ) 1,758 %
Other expense $ (28,944 ) $ (68,740 ) 39,796 (58 %)
Net loss $ (2,209,238 ) $ (186,070 ) (2,023,168 ) 1,087 %
Basic and dilutive loss per share of common stock (0.29 ) (0.03 ) (0.26 ) 991 %
Weighted average number of shares of common stock outstanding 7,619,275 7,000,000 Operating Expenses Operating expenses for the nine months ended
September 30, 2022 increased by $1,972,331 to $2,089,661 (Successor) as compared to $117,330 (Predecessor) for the nine months ended September
30, 2021. Operating expenses include salaries, selling and general and administrative, research and development, professional fees and
depreciation. Research and development fees for the nine months ended September 30, 2022 were $718,375 (Successor) compared to $61,091
(Predecessor) for the nine months ended September 30, 2021. Salaries and wages for the nine months ended September 30, 2022 were $994,982
(Successor) compared to $0 (Predecessor) for the nine months ended September 30, 2021. Included in salaries and wages for the nine months
ended September 30, 2022 was $158,705 (Successor) of stock option expense, compared to $0 (Predecessor) for the nine months ended September
30, 2021. Our expenses for selling, general and administrative for the nine months ended September 30, 2022, were $267,657 (Successor)
and $56,106 (Predecessor) for the nine months ended September 30, 2021. Professional fee for the nine months ended September 30, 2022
were $70,831 (Successor), and $0 (Predecessor) for the nine months ended September 30, 2021. Depreciation for the nine months ended September
30, 2022 was $37,816 (Successor) compared to $133 (Predecessor) for the nine months ended September 30, 2022. Other expense and income Interest expense was $1,970 and $8,488, respectively
for the nine months ended September 30, 2022 (Successor) and 2021 (Predecessor). Interest income was $4,608 and $0, respectively
for the nine months ended September 30, 2022 (Successor) and 2021 (Predecessor). Loss on the disposal of assets was $31,582
and $190,252, respectively for the nine months ended September 30, 2022 (Successor) and 2021 (Predecessor). Our loss of $31,582 (Successor)
for the nine months ended September 30, 2022 related to a deposit on a land purchase agreement in St. Lucie County. It has since been
determined that the cost associated with building our factory on the that site was cost prohibitive. Our loss of $190,252 (Predecessor)
for the nine months ended September 30, 2021 related to the loss of an asset from fire, which was somewhat offset with a gain from insurance
recover of $130,000 (Predecessor). Liquidity and Capital Resources The following table provide selected financial data as of September
30, 2022 and December 31, 2021:
September 30, December 31,
2022 2021 Change % Change
Cash and cash equivalents $ 13,940,706 $ 1,803,285 12,137,421 673.1 %
Current assets $ 14,387,391 $ 1,891,762 12,495,629 660.5 %
Current liabilities $ 197,239 $ 690,378 (493,139 ) (71.4 %)
Working capital $ 14,190,152 $ 1,201,384 12,988,768 1,081.2 % As of September 30, 2022, we had cash and
cash equivalents, and working capital of $13,940,706 and $14,190,152, respectively, compared to $1,803,285 and $1,201,384, respectively,
on December 31, 2021. In August of 2022 we completed our IPO, which increased our cash be approximately $15,231,000. Prior to our IPO,
our sole source of funding had been from Twin Vee. Twin Vee has financed our working capital needs, primarily prototyping, consulting
services, rent, interest and payroll through an initial $2,000,000 equity investment. Subsequently Twin Vee invested an additional $500,000
in us on May 25, 2022, for ongoing operating costs. No additional shares of common stock or other rights were issued to Twin Vee for such
additional investment. In addition, Twin Vee has provided management services to us for a monthly fee of $5,000. Additionally, we are
allowed to use space at its facility for a variable monthly cost. We expect to continue to rent space from Twin Vee until we have built
our own manufacturing facility. Upon the completion of the IPO we transitioned the management agreement with Twin Vee from an agreement
providing management services to an administrative services agreement under which Twin Vee provide us with certain administrative services,
such as procurement, shipping, receiving, storage and use of Twin Vee’s facility until our new planned facility is completed. We
have incurred and expect to continue to incur significant costs in pursuit of our financing and construction of our new manufacturing
facility. Our management plans to use the proceeds from the IPO to finance these expenses. We believe that our current capital resources,
will be sufficient to fund our operations and growth initiative for at least 18 months following the date of this Quarterly Report on
Form 10-Q. The Company expects to continue to incur net losses, and we anticipate that our quarterly loss rate will increase, as we move
into building and testing additional prototypes, we will have significant cash outflows for at least the next 12 months.
Successor Company Predecessor Company
Nine Months Ended
September 30,
2022 2021 Change % Change
Cash (used in) provided by operating activities $ (2,331,730 ) $ 13,875 (2,345,605 ) 16,905 %
Cash used in investing activities $ (465,086 ) $ (362,947 ) (102,139 ) 28 %
Cash provided by financing activities $ 14,934,237 $ 349,072 14,585,165 4,178 %
Cash at end of period $ 13,940,706 $ — 13,940,706 — Cash Flow from Operating Activities During the nine months ending September 30,
2022 (Successor) we generated negative cash flows from operating activities of $2,331,730 and during the nine months ending September
30, 2021 (Predecessor), we generated cash flows from operating activities of $13,875, respectively. During the nine months ending September
30, 2022 (Successor) and 2021 (Predecessor), we had a net loss of $2,209,238, and $186,070, respectively. During the nine months ending
September 30, 2022 (Successor) our cash used in operating activities was impacted by an increase of prepaid expenses of $358,208 and accrued
liabilities of $23,438, During the nine months ending September 30, 2022 (Successor), our cash used in operating activities was impacted
by a decrease of accounts payable of $26,151, contract liabilities – customer deposits of $4,900 and by non-cash expenses of $228,103
due to depreciation, stock option expense and a loss on the disposal of assets. During the nine months ending September 30, 2021 (Predecessor)
our cash provided by operating activities was impacted by a decrease of accrued liabilities of $9,560 and by non-cash expenses of $190,385
due to depreciation and a loss on the disposal of assets. Cash Flows from Investing Activities For the nine months ended September 30, 2022
(Successor) and 2021 (Predecessor), we used $465,086, and $362,947 in investing activities for the purchase of property and equipment,
primarily for the molds for the new Forza deck and hull. Cash Flows from Financing Activities Prior to our IPO we had financed our operations
primarily from capital provided from Twin Vee in the form of an equity investment and advances. During the nine months ended September
30, 2022 (Successor) and 2021 (Predecessor), net cash provided by financing activities was $14,934,237, and $349,072. On August 16, 2022,
we closed our initial public offering of 3,450,000 shares of our common stock at a public offering
price of $5.00 per share, including 450,000 shares sold upon full exercise of the underwriter’s option to purchase additional shares,
for net proceeds of $15,231,350. Additional cash from financing activities of Critical Accounting Estimates This discussion and analysis of our financial
condition and results of operations is based on four financial statements, which have been prepared in accordance with generally accepted
accounting principles in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and assumptions
that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the
financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical
experience and on various other factors that we believe are reasonable under the circumstances, that results of which form the basis for
making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may
differ from these estimated under different assumption or conditions. While our significant accounting policies are described in more
detail in the notes to our financial statements included elsewhere in the Quarterly report on Form 10-Q, we believe that the following
accounting policies are critical to understanding our historical and future performance, as these policies relate to the more significant
areas involving managements judgements and estimates. Controls and Procedures We are not currently required to maintain
an effective system of internal controls as defined by Section 404 of the Sarbanes-Oxley Act. We will be required to comply with
the internal control over financial reporting requirements of the Sarbanes-Oxley Act for the twelve-month period ending December
31, 2022. Only in the event that we are deemed to be a large accelerated filer or an accelerated filer, and no long qualify as an emerging
growth company, would we be required to comply with the independent registered public accounting firm attestation requirement. Further,
for as long as we remain an emerging growth company as defined in the JOBS Act, we intend 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 independent registered public accounting firm attestation requirement. Use of Estimates The preparation of financial statements in
conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) required management to make estimates
and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Included
in those estimates are assumptions about useful life of fixed assets. Cash and Cash Equivalents Cash and cash equivalents include all highly
liquid investments with original maturities of three months or less at the time of purchase. On September 30, 2022, the Company had cash
and cash equivalents of $13,940,706, on December 31, 2021, the Company has cash and cash equivalents of $1,803,285. Property and Equipment Property and equipment are stated at cost.
Depreciation is provided using the straight-line method over the estimated useful lives of the related assets. The estimated useful lives
of property and equipment range from three to seven years. Upon sale or retirement, the cost and related accumulated depreciation and
amortization are eliminated from their respective accounts, and the resulting gain or loss is included in results of operations. Repairs
and maintenance charges, which do not increase the useful lives of the assets, are charged to operations as incurred. Impairment of Long-lived Assets Management assesses the recoverability of
its long-lived assets when indicators of impairment are present. If such indicators are present, recoverability of these assets is determined
by comparing the undiscounted net cash flows estimated to result from those assets over the remaining life to the assets’ net carrying
amounts. If the estimated undiscounted net cash flows are less than the net carrying amount, the assets would be adjusted to their fair
value, based on appraisal or the present value of the undiscounted net cash flows. Research and Development Research and development costs are expensed
when incurred. Such costs for the nine months ended September 30, 2022 were $718,375 compared to $61,091 for the period ending September
30, 2021. Advertising Costs Advertising and marketing costs are expensed
as incurred. For the nine months ended September 30, 2022 advertising and marketing costs incurred by the Company totaled $8,314. For
the periods October 15, 2021 through December 31, 2021 (Successor), January 1, 2021 through October 14, 2021 (Predecessor), and year ended
December 31, 2020 (Predecessor) advertising and marketing costs incurred by the Company totaled $7,130, $0 and $0, respectively, and are
included in selling and general and administrative expenses in the accompanying statements of operations. Income Taxes The Company is a C Corporation under the
Internal Revenue Code and a similar section of the state code. All income tax amounts reflect the use of
the liability method under accounting for income taxes. Income taxes are provided for the tax effects of transactions reported in the
financial statements and consist of taxes currently due plus deferred taxes arising primarily from differences between financial and tax
reporting purposes. Deferred income taxes, net of appropriate
valuation allowances, are determined using the tax rates expected to be in effect when the taxes are actually paid. Valuation allowances
are recorded against deferred tax assets when it is more likely than not that such assets will not be realized. When an uncertain tax
position meets the more likely than not recognition threshold, the position is measured to determine the amount of benefit or expense
to recognize in the financial statements. In accordance with U.S GAAP, the Company
follows the guidance in FASB ASC Topic 740, Accounting for Uncertainty in Income Taxes. At December 31, 2021, the Company does not believe
it has any uncertain tax positions that would require either recognition or disclosure in the accompanying financial statements. The Company’s income tax returns are
subject to review and examination by federal, state and local governmental authorities. Recent Accounting Pronouncements All newly issued accounting pronouncements
not yet effective have been deemed either immaterial or not applicable. OFF-BALANCE SHEET ARRANGEMENTS We did not have during the periods presented,
and we do not currently have, any off-balance sheet arrangements, as defined under Securities and Exchange Commission rules.
ITEM 3. We are a smaller reporting company as defined
by Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.
ITEM 4. Evaluation of Disclosure Controls and Procedures Our management,
with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls
and procedures as of September 30, 2022. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required
to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits
under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal
financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. We
have adopted and maintain disclosure controls and procedures (as defined Rules 13a-15(e) and 15d-15(e) under the Exchange
Act) that are designed to provide reasonable assurance that information required to be disclosed in the reports filed under the Exchange
Act, such as this Quarterly Report on Form 10-Q, is collected, recorded, processed, summarized and reported within the time periods
specified in the rules of the SEC. Our disclosure controls and procedures are also designed to ensure that such information is accumulated
and communicated to management to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures,
no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily
applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure
controls and procedures as of September 30, 2022 our Chief Executive Officer and Chief Financial Officer concluded that, as of such a
date, our disclosure controls and procedures were not effective at the reasonable assurance level, d ue
to the material weaknesses in our internal control over financial reporting, as further described below Previously Reported
Material Weakness As disclosed in
Part II—Item 1A. “Risk Factors” contained elsewhere in this Quarterly Report on Form 10-Q, we previously identified
material weaknesses in our internal control over financial reporting relating to lack of segregation of duties We have not yet retained
sufficient staff or engaged sufficient outside consultants with appropriate experience in GAAP presentation, especially of complex instruments,
to devise and implement effective disclosure controls and procedures, or internal controls. Significant progress has been made, we have
hired additional staff and are in the process of training, the required procedures and controls have been implemented. We will be testing
these controls over the coming months to verify that the material weakness has been remediated. We continue to work with outside consultants
with the appropriate experience to aid in the remedy these weaknesses. As such, the auditor provided us with a letter stating that our
internal controls with respect to the financial close and financial reporting do not include a sufficient process to reconcile the accounts
to supporting records and an independent review process to ensure U.S. GAAP financial statements are free from error. W e
have determined that these control deficiencies constituted material weaknesses in our internal control over financial reporting. A material
weakness is a deficiency or combination of deficiencies in our internal control over financial reporting such that there is a reasonable
possibility that a material misstatement of our condensed financial statements would not be prevented or detected on a timely basis. These
deficiencies could result in additional misstatements to our condensed financial statements that would be material and would not be prevented
or detected on a timely basis. Remediation Plan Management has developed
and is executing a remediation plan to address the previously disclosed material weaknesses. We are actively engaged in the remediation
of each of the outstanding material weaknesses, including the retention of a full-time controller and utilizing the assistance of outside
advisors where appropriate. To remediate the
existing material weaknesses, additional time is required to demonstrate the effectiveness of the remediation efforts. The material weaknesses
cannot be considered remediated until the applicable remedial controls operate 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 nine months ended September 30, 2022, we hired additional staff
in our finance department and have developed and refined our controls and other producers that are designed to ensure that information
required to be disclosed by us in the reports that we file with the SEC are recorded, processed, summarized and reported within the time
periods specified in SEC rules and in accordance with GAAP.
ITEM 1. From time to time, we may become involved
in legal proceedings or be subject to claims arising in the ordinary course of our business. We are not presently a party to any legal
proceedings that, if determined adversely to us, would individually or taken together have a material adverse effect on our business,
operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on us because of
defense and settlement costs, diversion of management resources and other factors.
ITEM 1A. Investing in our securities involves a high
degree of risk. You should consider carefully the following risks, together with all the other information in this Quarterly Report on
Form 10-Q, including our condensed financial statements and notes thereto. If any of the following risks actually materializes, our operating
results, financial condition and liquidity could be materially adversely affected. RISKS RELATED TO OUR BUSINESS We are a start-up entity and expect
to incur significant expenses and continuing losses for the foreseeable future. We are a start-up entity and have had very
limited operations to date. To date, we have designed and manufactured only prototypes of our electric sport boat, have not yet commercialized
our boats and have not sold any boats. We believe that we will continue to incur operating and net losses in the future while we grow,
including following our initial generation of revenues from the sale of our boats which may occur later than we expect or not at all.
We do not expect to be profitable for the foreseeable future as we invest in our business, build capacity and ramp up operations, and
we cannot assure you that we will ever achieve or be able to maintain profitability in the future. Even if we are able to successfully
develop our boats and attract customers, there can be no assurance that we will be financially successful. For example, as we develop
our product portfolio, we will need to manage costs effectively to sell those products at our expected margins. Failure to become profitable
would materially and adversely affect the value of your investment. If we are ever to achieve profitability, it will be dependent upon
the successful development and commercial introduction and acceptance of our electric sport boats and the development of a vertically
integrated direct-to-consumer distribution system to market and sell our boats, which may not occur. As such, for the foreseeable future,
we will have to fund all our operations and capital expenditur |
