[Part I](index=5&type=section&id=PART%20I) [Business](index=5&type=section&id=Item%201.%20Business) Polar Power designs and sells DC power systems for telecom and diversified markets, focusing on off-grid and backup power - The company designs, manufactures, and sells DC power systems for telecommunications, military, EV charging, marine, and industrial markets, focusing on prime power and backup applications[17](index=17&type=chunk)[18](index=18&type=chunk) - In 2022, the company received purchase orders totaling **$6.2 million** from a South Pacific telecommunications customer and **$1.1 million** for solar hybrid systems from another customer in the same region[23](index=23&type=chunk)[25](index=25&type=chunk) - A master service agreement with the largest customer was renewed in September 2022, which accounted for **66%** of total net sales in 2022[24](index=24&type=chunk) - Approximately **72%** of net sales in 2022 were from DC power systems supporting 5G networks[29](index=29&type=chunk) | Category | Percentage of Backlog (as of Dec 31, 2022) | | :--- | :--- | | Largest U.S. Telecom Customer | 47% | | Other U.S. Telecom Customers | 16% | | International Telecom Customers | 32% | | Marine Industry | 1% | | Military Markets | 1% | | Other Markets | 3% | | **Total Backlog** | **$12,001 (in thousands)** | [Risk Factors](index=22&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks from COVID-19, customer concentration, supply chain, competition, and CEO ownership influence - The COVID-19 pandemic has negatively impacted sales, operations, and supply chains, and its ultimate impact remains uncertain[136](index=136&type=chunk) - The company is highly dependent on its largest customer in the U.S. telecommunications market, AT&T, and any adverse change in this relationship could materially affect results[144](index=144&type=chunk) - The company has a history of significant net losses, including a **$5.6 million** loss in 2022 and a **$1.4 million** loss in 2021[143](index=143&type=chunk) - The company faces risks from raw material shortages and price increases, particularly for components like engines from suppliers such as Yanmar, Perkins, and Toyota, with whom there are no long-term contracts[154](index=154&type=chunk)[164](index=164&type=chunk) - The Chairman, President, and CEO, Arthur D. Sams, beneficially owns **approximately 44%** of the outstanding common stock, giving him significant influence over corporate matters[197](index=197&type=chunk) [Unresolved Staff Comments](index=41&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments.) The company reports that there are no unresolved staff comments - There are no unresolved staff comments[223](index=223&type=chunk) [Properties](index=41&type=section&id=Item%202.%20Properties.) The company's principal offices and main manufacturing facility are located in a leased 40,000 square foot space in Gardena, California. It also leases a 29,000 square foot second manufacturing facility and a 20,000 square foot warehouse nearby. Management believes these facilities are sufficient for the next twelve months - The company leases three facilities in Gardena, CA: a **40,000 sq ft** main office/manufacturing/R&D center, a **29,000 sq ft** manufacturing facility, and a **20,000 sq ft** warehouse[224](index=224&type=chunk) [Legal Proceedings](index=41&type=section&id=Item%203.%20Legal%20Proceedings.) The company is not currently involved in any legal proceedings that are expected to have a material adverse effect on its business, financial condition, or results of operations - The company is not currently a party to any material legal proceedings[225](index=225&type=chunk) [Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the company - Mine safety disclosures are not applicable[227](index=227&type=chunk) [Part II](index=43&type=section&id=PART%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=43&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities.) The company's common stock is traded on The Nasdaq Capital Market under the symbol "POLA". As of March 31, 2023, there were 12,949,550 shares of common stock outstanding, held by approximately 21 stockholders of record. The company reported no recent sales of unregistered securities - Common stock trades on The Nasdaq Capital Market under the symbol "POLA"[230](index=230&type=chunk) - As of March 31, 2023, there were **12,949,550 shares** of common stock outstanding[230](index=230&type=chunk) [Management Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%207.%20Management%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Net sales decreased in 2022 due to supply issues, resulting in a significant net loss and reduced liquidity | Metric | 2022 (in thousands) | 2021 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $16,056 | $16,896 | (5)% | | Gross Profit | $2,125 | $3,445 | (38)% | | Loss from Operations | ($5,533) | ($3,098) | (79)% | | Net Loss | ($5,584) | ($1,414) | (295)% | - Net sales decreased by **5%** in 2022 due to labor shortages and supply chain constraints, which postponed approximately **$3.5 million** of shipments into 2023[254](index=254&type=chunk)[260](index=260&type=chunk) - Gross margin decreased from **20.4%** in 2021 to **13.2%** in 2022, primarily due to decreased factory overhead absorption from lower sales volume[265](index=265&type=chunk) - The sales backlog as of December 31, 2022, was **$12.0 million**, with the majority expected to ship within the next twelve months[290](index=290&type=chunk) - Working capital decreased by **$4.4 million** to **$17.4 million** at the end of 2022, with cash and cash equivalents falling to **$0.2 million** from **$5.1 million** at the end of 2021[274](index=274&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=54&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk.) This item is not applicable to the company - This section is not applicable[292](index=292&type=chunk) [Financial Statements and Supplementary Data](index=54&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data.) This section refers to the company's financial statements, which begin on page F-1 of the Annual Report on Form 10-K - This item references the financial statements beginning on page F-1[293](index=293&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Finance Disclosure](index=54&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Finance%20Disclosure.) The company reports that there have been no changes in or disagreements with its accountants on accounting and finance disclosure - There were no disagreements with accountants on accounting and financial disclosure[294](index=294&type=chunk) [Controls and Procedures](index=54&type=section&id=Item%209A.%20Controls%20and%20Procedures.) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of December 31, 2022. Management also concluded that the company's internal control over financial reporting was effective as of the same date, based on the COSO 2013 framework. No material changes to internal controls were identified during the fourth quarter of 2022 - Management concluded that as of December 31, 2022, the company's disclosure controls and procedures were effective[296](index=296&type=chunk) - Management concluded that as of December 31, 2022, the company's internal control over financial reporting was effective[299](index=299&type=chunk) [Other Information](index=55&type=section&id=Item%209B.%20Other%20Information.) The company reports no other information for this item - There is no information to report under this item[303](index=303&type=chunk) [Part III](index=56&type=section&id=PART%20III) [Directors, Executive Officers and Corporate Governance](index=56&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance.) The company's executive team includes Arthur D. Sams as Chairman, President, CEO, and Secretary, and Luis Zavala as CFO. The Board of Directors consists of four members, with three (Keith Albrecht, Peter Gross, and Katherine Koster) determined to be independent. The Board has established an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee, each with defined responsibilities and composed of independent directors. The company has also adopted a Code of Business Conduct and Ethics applicable to all directors, officers, and employees - The executive officers are Arthur D. Sams (Chairman, President, CEO, Secretary) and Luis Zavala (CFO)[307](index=307&type=chunk) - The Board of Directors has **four members**, **three** of whom are independent: Keith Albrecht, Peter Gross, and Katherine Koster[320](index=320&type=chunk)[324](index=324&type=chunk) - The Board has three standing committees: Audit, Compensation, and Nominating and Corporate Governance, all composed of independent directors[326](index=326&type=chunk) - A written code of business conduct and ethics has been adopted for all directors, officers, and employees[335](index=335&type=chunk) [Executive Compensation](index=61&type=section&id=Item%2011.%20Executive%20Compensation.) Executive compensation for 2022 consisted of base salary, potential non-equity cash bonuses, and long-term equity incentives. Base salaries for the CEO ($275k) and CFO ($175k) were set based on a peer group analysis. The non-equity incentive plan allowed for bonuses up to 100% of base salary based on achieving revenue, gross margin, EBITDA, customer concentration, and international sales targets; however, no performance goals were met for 2022. Long-term incentives are granted via the 2016 Omnibus Incentive Plan. Employment agreements are in place for executive officers, outlining terms for termination and change in control | Name and Principal Position | Year | Salary ($) | Stock Compensation ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | | Arthur D. Sams, President, CEO | 2022 | 275,000 | 55,000 | 330,000 | | Luis Zavala, CFO | 2022 | 175,000 | 35,000 | 210,000 | | Rajesh Masina, Former COO | 2022 | 175,000 | — | 175,000 | - Executive compensation includes base salary, non-equity incentives (cash bonuses), and long-term equity incentives[346](index=346&type=chunk) - For **2022**, none of the performance goals for the non-equity incentive plan were met, which included targets for revenue, gross margin, EBITDA, customer concentration, and international sales[352](index=352&type=chunk) - The company has a 2016 Omnibus Incentive Plan for granting equity awards like stock options and restricted stock to attract, retain, and motivate employees, officers, and directors[366](index=366&type=chunk)[367](index=367&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=74&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters.) As of March 31, 2023, Arthur D. Sams, the Chairman and CEO, beneficially owned 43.4% of the company's common stock. All directors and executive officers as a group beneficially owned 44.1% of the common stock. The company's 2016 Omnibus Incentive Plan, approved by security holders, had 140,000 outstanding options with a weighted-average exercise price of $5.22 and 1,453,038 securities remaining available for future issuance as of December 31, 2022 | Name of Beneficial Owner | Amount and Nature of Beneficial Ownership | Percent of Class | | :--- | :--- | :--- | | Arthur D. Sams | 5,643,600 | 43.4% | | All directors and executive officers as a group (5 persons) | 5,751,739 | 44.1% | | Plan Category | Securities to be Issued Upon Exercise | Weighted-Average Exercise Price | Securities Remaining Available for Future Issuance | | :--- | :--- | :--- | :--- | | Equity Compensation Plans Approved by Security Holders (2016 Plan) | **140,000** | **$5.22** | **1,453,038** | [Certain Relationships and Related Transactions, and Director Independence](index=75&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence.) The company had a Subcontractor Installer Agreement with Smartgen Solutions, Inc., a company partially owned by the former COO, Rajesh Masina. Under this agreement, Smartgen performed field services for Polar Power, amounting to $0 in 2022 and $88,000 in 2021. This agreement was terminated effective January 31, 2023. The company has a formal written policy for reviewing and approving related person transactions, managed by the Audit Committee, to ensure they are on arm's-length terms and in the best interests of the company - The company had a service agreement with Smartgen Solutions, Inc., an entity related to former COO Rajesh Masina. Smartgen performed **$0** in services in 2022 and **$88k** in 2021. The agreement was terminated in January 2023[420](index=420&type=chunk)[423](index=423&type=chunk) - The company has adopted a written policy for the review, approval, or ratification of related person transactions, managed by the Audit Committee[426](index=426&type=chunk) [Principal Accountant Fees and Expenses](index=77&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Expenses.) The company's principal accountant, Weinberg & Company, P.A., billed a total of $247,000 in 2022 and $281,000 in 2021. These fees primarily consisted of audit fees and tax fees. All services were pre-approved by the Audit Committee, which has a policy for pre-approving all audit and non-audit services | Fee Type | 2022 (in thousands) | 2021 (in thousands) | | :--- | :--- | :--- | | Audit Fees | $198 | $222 | | Audit-Related Fees | $3 | $2 | | Tax Fees | $46 | $57 | | **Total** | **$247** | **$281** | - The Audit Committee pre-approves all audit and permissible non-audit services provided by the independent auditor[437](index=437&type=chunk) [Part IV](index=78&type=section&id=PART%20IV) [Exhibits, Financial Statement Schedules](index=78&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules.) This section provides references to the financial statements, which are included starting on page F-1, and the exhibits, which are listed in the Index to Exhibits. No financial statement schedules were filed - This section refers to the financial statements on page F-1 and the exhibit list[439](index=439&type=chunk)[441](index=441&type=chunk) [Form 10-K Summary](index=78&type=section&id=Item%2016.%20Form%2010-K%20Summary.) No Form 10-K summary was provided - This section is noted as 'None'[442](index=442&type=chunk) [Financial Statements and Supplementary Data](index=79&type=section&id=Index%20to%20Consolidated%20Financial%20Statements) [Report of Independent Registered Public Accounting Firm](index=80&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor, Weinberg & Company, P.A., issued an unqualified opinion on the financial statements for the years ended December 31, 2022 and 2021, stating they are presented fairly in all material respects. The report highlights two critical audit matters: the valuation of inventory, due to significant management judgment in estimating future demand, and the assessment of the company's ability to continue as a going concern, given its net losses and cash usage, which required significant judgment in forecasting future cash flows - The auditor issued an **unqualified opinion**, stating the financial statements are fairly presented in conformity with U.S. GAAP[446](index=446&type=chunk) - Critical Audit Matters identified were **Inventory Valuation** and the **Assessment of the Company's Ability to Continue as a Going Concern**[450](index=450&type=chunk) [Financial Statements](index=82&type=section&id=Financial%20Statements) Financial statements show decreased assets, increased liabilities, a significant net loss, and cash used in operations | Balance Sheet (in thousands) | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | **Total Current Assets** | $23,317 | $25,154 | | Cash and cash equivalents | $211 | $5,101 | | Inventories, net | $15,460 | $9,017 | | **Total Liabilities** | $6,007 | $3,930 | | **Total Stockholders' Equity** | $18,181 | $23,250 | | Statement of Operations (in thousands) | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | | :--- | :--- | :--- | | Net sales | $16,056 | $16,896 | | Gross profit | $2,125 | $3,445 | | Loss from operations | ($5,533) | ($3,098) | | **Net Loss** | **($5,584)** | **($1,414)** | | Statement of Cash Flows (in thousands) | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | ($6,507) | ($9,380) | | Net Cash Used In Investing Activities | ($25) | ($71) | | Net Cash Provided By Financing Activities | $1,642 | $12,906 | [Notes to Financial Statements](index=86&type=section&id=Notes%20to%20Financial%20Statements) Notes detail liquidity, revenue concentration, credit facility, and significant NOLs with a full valuation allowance - Management concluded that despite a net loss of **$5.6 million** in 2022, the company has adequate cash flow and credit availability to continue as a going concern for at least one year[470](index=470&type=chunk)[471](index=471&type=chunk) | Net Sales by Customer Type (in thousands) | 2022 | 2021 | | :--- | :--- | :--- | | Telecom | $15,357 | $14,953 | | Government/Military | $38 | $995 | | Marine | $205 | $76 | | Other | $456 | $872 | | **Total net sales** | **$16,056** | **$16,896** | - The company has a line of credit with Pinnacle Bank with a maximum of **$4 million**. As of Dec 31, 2022, **$1.884 million** was outstanding[513](index=513&type=chunk)[514](index=514&type=chunk) - The company has federal and state Net Operating Loss (NOL) carryforwards of approximately **$10.6 million** and **$14.8 million**, respectively, but a full valuation allowance has been recorded against the resulting deferred tax assets[539](index=539&type=chunk)[540](index=540&type=chunk) - The company qualified for approximately **$2 million** in Employee Retention Credits (ERC) for 2021, which is recorded as a receivable as of December 31, 2022[545](index=545&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33- ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33-04790 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33-0479 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33-0479020 | ...

Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33- ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 OR Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33-0479020 | | --- | --- | | (State or other jurisdiction of | (I.R.S. Employer | | incorporation or organization) | Identification Number) | | 249 E. Gardena Bl ...

PART I – FINANCIAL INFORMATION [Condensed Financial Statements](index=5&type=section&id=ITEM%201.%20Condensed%20Financial%20Statements) For Q1 2021, Polar Power, Inc. reported net sales of $3.29 million, a 15% increase year-over-year, but a net loss of $1.9 million, while cash and equity significantly increased due to a $12.5 million equity offering Condensed Statements of Operations (in thousands) | Financial Metric | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net Sales | $3,290 | $2,860 | | Gross loss | $(58) | $(160) | | Loss from operations | $(1,898) | $(2,320) | | Net loss | $(1,903) | $(201) | | Net loss per share | $(0.15) | $(0.02) | Condensed Balance Sheets (in thousands) | Account | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Cash and cash equivalents | $11,358 | $1,646 | | Total current assets | $25,755 | $14,645 | | Total assets | $28,598 | $17,799 | | Total current liabilities | $4,500 | $4,522 | | Total liabilities | $5,837 | $6,308 | | Total stockholders' equity | $22,761 | $11,491 | Condensed Statements of Cash Flow (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2021 | Three Months Ended March 31, 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(3,381) | $(1,867) | | Net cash provided by investing activities | $0 | $8 | | Net cash provided by (used in) financing activities | $13,093 | $(82) | | Increase (decrease) in cash | $9,712 | $(1,941) | - In February 2021, the company completed an underwritten public offering of 750,000 shares of common stock, receiving net proceeds of approximately **$12.5 million**[70](index=70&type=chunk) - For Q1 2021, sales to the telecommunications sector accounted for **93% of total net sales**. The company's three largest customers generated **59%**, **15%**, and **11% of revenues**, respectively[34](index=34&type=chunk)[50](index=50&type=chunk) [Management's Discussion And Analysis Of Financial Condition And Results Of Operations](index=21&type=section&id=ITEM%202.%20Management's%20Discussion%20And%20Analysis%20Of%20Financial%20Condition%20And%20Results%20Of%20Operations) Management attributes Q1 2021 revenue growth to telecom demand, despite a gross loss, with liquidity significantly enhanced by a $12.5 million equity offering and increased backlog [Overview and COVID-19 Impact](index=21&type=section&id=Overview%20and%20COVID-19%20Impact) The company, primarily serving the telecommunications market, experienced adverse impacts from COVID-19, leading to cost reductions and progress in international sales and military backlog diversification - The company designs and manufactures DC power systems, primarily for the telecommunications market, which accounted for **93% of net sales** in Q1 2021[86](index=86&type=chunk)[89](index=89&type=chunk) - The COVID-19 pandemic has had a material adverse impact, causing decreased sales and delays in sourcing raw materials, leading management to implement a cost reduction program[94](index=94&type=chunk)[97](index=97&type=chunk) - International sales grew to **26% of total net sales** for Q1 2021, up from 6% in Q1 2020, indicating progress in market diversification[90](index=90&type=chunk) - Backlog orders from military customers represented **19% of the total backlog** as of March 31, 2021, highlighting growth in customer diversification[91](index=91&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) Net sales increased by 15% due to higher telecom demand, gross loss improved despite under-utilized facilities, and operating expenses decreased due to cost reduction efforts Comparison of Operations for Three Months Ended March 31 (in thousands) | Line Item | 2021 | 2020 | $ Variance | % Variance | | :--- | :--- | :--- | :--- | :--- | | Net sales | $3,290 | $2,860 | $430 | 15% | | Gross loss | $(58) | $(160) | $102 | 64% | | Total operating expenses | $1,840 | $2,160 | $320 | 15% | | Loss from operations | $(1,898) | $(2,320) | $422 | 18% | | Net loss | $(1,903) | $(201) | $(1,702) | (847)% | - The **15% increase in net sales** was primarily driven by higher sales of DC power systems to Tier-1 telecommunications customers[120](index=120&type=chunk) - Gross loss improved due to increased shipments and better labor efficiencies, though manufacturing facilities remain under-utilized, negatively affecting margins[123](index=123&type=chunk) - Operating expenses decreased primarily due to a **32% reduction in sales and marketing expenses** from COVID-19 travel restrictions and a **16% decrease in G&A expenses** from staff reductions[124](index=124&type=chunk)[126](index=126&type=chunk) [Liquidity, Capital Resources, and Backlog](index=29&type=section&id=Liquidity%2C%20Capital%20Resources%2C%20and%20Backlog) Working capital significantly increased to $21.3 million due to a $12.5 million public stock offering, with a $5.6 million sales backlog primarily from telecom and military customers - Working capital increased to **$21.3 million** at March 31, 2021, from **$10.1 million** at year-end 2020, mainly due to net proceeds of approximately **$12.5 million** from a public stock offering in February 2021[130](index=130&type=chunk)[132](index=132&type=chunk) - The company has a revolving credit facility of up to **$4.0 million**, with **$2.5 million available** as of March 31, 2021, and no outstanding balance[133](index=133&type=chunk)[135](index=135&type=chunk) - The company holds a **$1.7 million PPP loan** from May 2020 and expects the full amount to be forgiven[137](index=137&type=chunk)[139](index=139&type=chunk) - As of March 31, 2021, the company had a sales backlog of **$5.6 million**, comprised of **71% from telecommunications customers** and **19% from military contractors**[145](index=145&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not applicable to the company as a smaller reporting company - Not applicable[146](index=146&type=chunk) [Controls and Procedures](index=31&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2021, with no material changes to internal control over financial reporting - Based on an evaluation as of the end of the period, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[147](index=147&type=chunk) - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[148](index=148&type=chunk) PART II – OTHER INFORMATION [Legal Proceedings](index=32&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings expected to have a material adverse effect on its business or financial condition - The company is not currently involved in any material legal proceedings[150](index=150&type=chunk) [Risk Factors](index=32&type=section&id=ITEM%201A.%20Risk%20Factors) Key risks include the ongoing negative impact of COVID-19, heavy dependence on a few large telecom customers, inventory risk, reliance on key engine suppliers, and potential stock price volatility [Business and Industry Risks](index=32&type=section&id=Business%20and%20Industry%20Risks) The company faces significant risks from the COVID-19 pandemic, high customer concentration in U.S. telecommunications, substantial inventory risk, and dependence on key engine suppliers without long-term contracts - The COVID-19 pandemic has had, and is expected to continue to have, a significant negative impact on sales, operations, and the supply chain[153](index=153&type=chunk) - The company is highly dependent on three main customers in the U.S. telecommunications market (AT&T, T-Mobile, Verizon), and the loss or reduction of business from them could adversely affect results[160](index=160&type=chunk) - The company faces significant inventory risk, having recorded a **$3.4 million inventory write-down** in 2020 due to lower-than-expected demand[168](index=168&type=chunk) - There is a substantial dependence on key engine suppliers, primarily Yanmar and Toyota, without long-term supply contracts[180](index=180&type=chunk) [Intellectual Property Risks](index=42&type=section&id=Intellectual%20Property%20Risks) The company's success relies on protecting proprietary technology primarily through trade secrets and confidentiality agreements, which offer limited protection compared to patents - The company's success depends on protecting its proprietary technology, primarily through trade secret laws and confidentiality agreements rather than patents, which offers limited protection[199](index=199&type=chunk)[200](index=200&type=chunk) [Common Stock Risks](index=43&type=section&id=Common%20Stock%20Risks) Risks include the significant influence of the CEO due to his 44% ownership, reduced reporting requirements as an "emerging growth company," and the absence of cash dividends - The company's Chairman, President, and CEO, Arthur D. Sams, beneficially owns approximately **44% of the outstanding common stock**, giving him significant influence over corporate matters[211](index=211&type=chunk) - The company is an "emerging growth company" under the JOBS Act, which allows for reduced public company reporting requirements that may make its stock less attractive to some investors[226](index=226&type=chunk) - The company does not anticipate paying cash dividends, so stockholders must rely on stock appreciation for any return on investment[216](index=216&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=51&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities during the period - None[239](index=239&type=chunk) [Defaults Upon Senior Securities](index=51&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) This section is not applicable - Not applicable[240](index=240&type=chunk) [Mine Safety Disclosure](index=51&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosure) This section is not applicable - Not applicable[241](index=241&type=chunk) [Other Information](index=51&type=section&id=ITEM%205.%20Other%20Information) The company reported no other information for the period - None[242](index=242&type=chunk) [Exhibits](index=51&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, which include officer certifications required by the Sarbanes-Oxley Act and interactive data files - The exhibits filed with this report include CEO/CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, as well as XBRL Instance Documents[246](index=246&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | 33-047902 ...

Washington, D.C. 20549 FORM 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2020 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to _____________ Commission file number: 001-37960 POLAR POWER, INC. (Exact name of registrant as specified in its charter) | Delaware | ...