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NOTE 1 - NATURE OF BUSINESS Dragonfly Energy Holdings Corp. (“New Dragonfly” or the “Company”) sells lithium ion battery packs for use in a wide variety of applications. The Company sells to distributors under the Dragonfly Energy brand name, and sells direct to consumers under the trade name Battleborn Batteries. In addition, the Company develops technology for improved lithium ion battery manufacturing and assembly methods. On October 7, 2022, a merger transaction between Chardan NexTech Acquisition 2 Corporation (“CNTQ”), Dragonfly Energy Corp. (“Legacy Dragonfly”), and Bronco Merger Sub, Inc. (“Merger Sub”) was completed pursuant to which Merger Sub was merged with and into Legacy Dragonfly, with Legacy Dragonfly surviving the merger. As a result of the merger, Legacy Dragonfly became a wholly owned subsidiary of New Dragonfly. Although New Dragonfly was the legal acquirer of Legacy Dragonfly in the merger, Legacy Dragonfly is deemed to be the accounting acquirer, and the historical financial statements of Legacy Dragonfly became the basis for the historical financial statements of New Dragonfly upon the closing of the merger. New Dragonfly together with its wholly owned subsidiary, Dragonfly Energy Corp., is referred to hereinafter as the “Company.” Furthermore, the historical financial statements of Legacy Dragonfly became the historical financial statements of the Company upon the consummation of the merger. As a result, the financial statements included in this Quarterly Report reflect (i) the historical operating results of Legacy Dragonfly prior to the merger; (ii) the combined results of CNTQ and Legacy Dragonfly following the close of the merger; (iii) the assets and liabilities of Legacy Dragonfly at their historical cost and (iv) the Legacy Dragonfly’s equity structure for all periods presented, as affected by the recapitalization presentation after completion of the merger.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of consolidation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and present the consolidated financial statements of the Company and its wholly owned subsidiary. All significant intercompany transactions and balances are eliminated in consolidation. Basis of presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with U.S. GAAP for interim financial information, and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) set forth in Article 8 of Regulation S X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These financial statements should be read along with the Annual Report filed of the Company for the annual period ended December 31, 2022. The consolidated balance sheet as of December 31, 2022 was derived from the audited consolidated financial statements as of and for the year then ended. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) Going Concern The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. For the three months ended March 31, 2023 and 2022, the Company incurred loss from operations and had negative cash flow from operations. As of March 31, 2023, the Company had $15,791 in cash and cash equivalents and working capital of $24,533. The Company’s ability to achieve profitability and positive cash flow depends on its ability to increase revenue, contain its expenses and maintain compliance with the financial covenants in its outstanding indebtedness agreements. In connection with the Company’s senior secured term loan facility in an aggregate principal amount of $<span id="xdx_907_eus-gaap--DebtInstrumentFaceAmount_iI_pn3n3_c20230331__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--LongtermDebtTypeAxis__custom--TermLoanMember_z3kkj2CFzOZ6" title="Loan amount">75,000 (the “Term Loan”), the Company is obligated to comply with certain financial covenants, which include maintaining a maximum senior leverage ratio, minimum liquidity, a springing fixed charge coverage ratio, and maximum capital expenditures (See Note 6). On March 29, 2023, the Company obtained a waiver from the Term Loan administrative agent and lenders of its failures to satisfy the fixed charge coverage ratio and maximum senior leverage ratio with respect to the minimum cash requirements under the Term Loan during the quarter ended March 31, 2023. It is probable that the Company will fail to meet these covenants within the next twelve months. If the Company is unable to obtain a waiver or if the Company is unable to comply with such covenants, the lenders have the right to accelerate the maturity of the Term Loan. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company may need to raise additional debt and/or equity financings to fund our operations, strategic plans, and meet its financial covenants. The Company has historically been able to raise additional capital through issuance of equity and/or debt financings and the Company intends to use its equity facility and raise additional capital as needed. However, the Company cannot guarantee that it will be able to raise additional equity, contain expenses, or increase revenue, and comply with the financial covenants under the Term Loan. Recently adopted accounting standards: In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The FASB subsequently issued amendments to ASU 2016-13, which have the same effective date and transition date of January 1, 2023. These standards replace the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measure at amortized cost to be presented at the net amount expected to be collected. The Company determined that this change does not have a material impact to the financial statements or financial statement disclosures. Recently issued accounting pronouncements: In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. The amendments in this update will be effective for the Company on January 1, 2024. The Company is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Accounts Receivable The Company’s trade receivables are recorded when billed and represent claims against third parties that will be settled in cash. Generally, payment is due from customers within 30 – 60 days of the invoice date and the contracts do not have significant financing components. Trade accounts receivables are recorded gross and are net of any applicable allowance. The Company has an allowance for doubtful accounts as of March 31, 2023 and December 31, 2022 of $116 and $90, respectively. Inventory Inventories (Note 4), which consist of raw materials and finished goods, are stated at the lower of cost (first in, first out) or net realizable value, net of reserves for obsolete inventory. We continually analyze our slow moving and excess inventories. Based on historical and projected sales volumes and anticipated selling prices, we established reserves. Inventory that is in excess of current and projected use is reduced by an allowance to a level that approximates its estimate of future demand. Products that are determined to be obsolete are written down to net realizable value. As of March 31, 2023 and December 31, 2022, no such reserves were necessary. Property and Equipment Property and equipment are stated at cost, including the cost of significant improvements and renovations. Costs of routine repairs and maintenance are charged to expense as incurred. Depreciation and amortization are calculated by the straight line method over the estimated useful lives for owned property, or, for leasehold improvements, over the shorter of the asset’s useful life or term of the lease. Depreciation expense for the three months ended March 31, 2023 and 2022 was $297 and $192, respectively. The various classes of property and equipment and estimated useful lives are as follows: SCHEDULE OF VARIOUS CLASSES OF PROPERTY AND EQUIPMENT AND ESTIMATED USEFUL LIVES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; width: 80%; border-collapse: collapse; margin-right: auto"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left; width: 50%">Office furniture and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; width: 50%; text-align: center"><span id="xdx_905_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MinimumMember_zMQGWFWO0s5a" title="Estimated useful life (in years)">3 to <span id="xdx_90D_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MaximumMember_zzuZHMe6tG3" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Vehicles</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">5 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Machinery and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90B_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MinimumMember_zSrKebM5JOPf" title="Estimated useful life (in years)">3 to <span id="xdx_903_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MaximumMember_zAI3NtBwyOEi" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Leasehold improvements</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90C_eus-gaap--PropertyPlantAndEquipmentUsefulLifeDescriptionOfTermExtensibleEnumeration_iI_dxL_c20230331_zWVxy8OouPD9" title="::XDX::http%3A%2F%2Ffasb.org%2Fus-gaap%2F2023%23LeaseholdImprovementsMember">Remaining Term of Lease</td></tr> </table> Use of Estimates The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Warrants The Company applies relevant accounting guidance for warrants to purchase the Company’s stock based on the nature of the relationship with the counterparty. For warrants issued to investors or lenders in exchange for cash or other financial assets, the Company follows guidance issued within Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”), to assist in the determination of whether the warrants should be classified as liabilities or equity. Warrants that are determined to require liability classification are measured at fair value upon issuance and are subsequently remeasured to their then fair value at each subsequent reporting period with changes in fair value recorded in current earnings. Warrants that are determined to require equity classification are measured at fair value upon issuance and are not subsequently remeasured unless they are required to be reclassified. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Revenue Recognition Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Revenue is recognized when control of the promised goods is transferred to the customer or reseller, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods and services. Revenue associated with products holding rights of return are recognized when the Company concludes there is not a risk of significant revenue reversal in the future periods for the expected consideration in the transaction. There are no material instances including discounts and refunds where variable consideration is constrained and not recorded at the initial time of sale. Generally, our revenue is recognized at a point in time for standard promised goods at the time of shipment when title and risk of loss pass to the customer. The Company may receive payments at the onset of the contract before delivery of goods for customers in the retail channel. Payment terms for distributors and OEMs are typically due within <span id="xdx_90D_ecustom--PaymentTermForDistributorsAndOriginalEquipmentManufacturers_dtD_c20230101__20230331__srt--RangeAxis__srt--MinimumMember_zPiIygHy9Yf7" title="Payment term for distributors and OEMs">30-<span id="xdx_90D_ecustom--PaymentTermForDistributorsAndOriginalEquipmentManufacturers_dtD_c20230101__20230331__srt--RangeAxis__srt--MaximumMember_z6FQIBHn4NO2" title="Payment term for distributors and OEMs">60 days after shipment. In such instances, the Company records a customer deposit liability. The Company recognizes these contract liabilities as sales after the revenue criteria are met. As of March 31, 2023 and December 31, 2022, the contract liability related to the Company’s customer deposits approximated $418 and $238, respectively. The Company recognized $211 of contract liability pertaining to the year ended December 31, 2022 as of March 31, 2023. The entire contract liability balance of $434 as of January 1, 2022 was recognized as revenue during the three months ended March 31, 2022. Disaggregation of Revenue The following table present our disaggregated revenues by distribution channel: SCHEDULE OF DISAGGREGATED REVENUES BY DISTRIBUTION CHANNEL <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 80%; margin-right: auto"> <tr style="display: none; vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49B_20230101__20230331_zDh8SMW3SKw2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49E_20220101__20220331_zfgcpoWhMCAg" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: Black 1.5pt solid; text-align: center">For the Three Months Ended March 31,</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Sales</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelDirectlyToConsumerMember_z77U9QQP25Q2" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 64%">Retail</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">7,069</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">13,035</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40B_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelThroughIntermediaryMember_zZ8MI91bkmu6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Distributor</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,968</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,087</td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__custom--OriginalEquipmentManufactureMember_zPlejtRyHPTk" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1.5pt">Original equipment manufacture</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">8,754</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,181</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zd4Zmm7Dtl71" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zvqw9TEMaroc" style="display: none; vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total sales</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> Shipping and Handling Shipping and handling fees paid by customers are recorded within net sales, with the related expenses recorded in cost of sales. Shipping and handling costs associated with outbound freight are included in sales and marketing expenses. Shipping and handling costs associated with outbound freight totaled $1,007 and $1,228 for the three months ended March 31, 2023 and 2022, respectively. Product Warranty The Company offers assurance type warranties from 5 to 10 years on its products. The Company estimates the costs associated with the warranty obligation using historical data of warranty claims and costs incurred to satisfy those claims. The Company estimates, based upon a review of historical warranty claim experience, the costs that may be incurred under our warranties and record a liability in the amount of such estimate at the time a product is sold. Factors that affect our warranty liability include the number of units sold, historical and anticipated rates of warranty claims, and cost per claim. We periodically assess the adequacy of our recorded warranty liability and adjust the accrual as claims data and historical experience warrants. The Company has assessed the costs of fulfilling its existing assurance type warranties and has determined that the estimated outstanding warranty obligation on March 31, 2023 and December 31, 2022 to be $400 and $328, respectively. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Concentrations Receivables from one customer comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zv8JM5Fsiluh" title="Concentration risk, percentage">50% of accounts receivable as of March 31, 2023. Receivables from three customers comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zlaBf7yBMkNe" title="Concentration risk, percentage">18%, <span id="xdx_904_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerTwoMember_znzMtNJn8I5c" title="Concentration risk, percentage">10% and <span id="xdx_902_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerThreeMember_zkst5ZnN0OEf" title="Concentration risk, percentage">10%, respectively, of accounts receivable as of December 31, 2022. There are no other significant accounts receivable concentration. Sales from <span id="xdx_905_ecustom--NumberOfVendors_pid_dc_uCustomer_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zAynJ5pJgL11" title="Number of vendors">one customer comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zWvUejsSgwX4" title="Concentration risk, percentage">26% of revenue for the three months ended March 31, 2023. There were no significant revenue concentrations for the three months ended March 31, 2022. Payables to <span id="xdx_90E_ecustom--NumberOfCustomers_pid_dc_uCustomer_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zaq5BlZQajog" title="Number of vendors">one vendor comprised approximately <span id="xdx_90F_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorMember_zYGGrdBYvFfe" title="Concentration risk, percentage">67% of accounts payables as of March 31, 2023. Payables to <span id="xdx_902_ecustom--NumberOfCustomers_pid_dc_uCustomer_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zF7s2KaHWKP" title="Number of vendors">one vendor comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorMember_zA9BOpCKcOWi" title="Concentration risk, percentage">61% of accounts payables as of December 31, 2022. For the three months ended March 31, 2023, <span id="xdx_903_ecustom--NumberOfVendors_pid_dc_uVendor_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zRsiyK8ACbI3" title="Number of vendors">two vendors accounted for approximately <span id="xdx_90B_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorOneMember_zlyLbQDP9KJi" title="Concentration risk, percentage">38% and <span id="xdx_908_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorTwoMember_zVHrRNxpkK8e" title="Concentration risk, percentage">10%, respectively, of the Company’s total purchases. For the three months ended March 31, 2022, <span id="xdx_90F_ecustom--NumberOfVendors_pid_dc_uVendor_c20220101__20220331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zdeVuA8a4tU9" title="Number of vendors">one vendor accounted for approximately <span id="xdx_901_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20220331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--OneVendorMember_zgavPUxPMXb9" title="Concentration risk, percentage">34% of the Company’s total purchases. Advertising The Company expenses advertising costs as they are incurred and are included in selling and marketing expenses. Advertising expenses amounted to $587 and $781 for the three months ended March 31, 2023, and 2022, respectively. Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees and non-employee consultants using a fair value method which requires the recognition of compensation expense for costs related to all stock-based payments, including stock options (Note 11). The fair value method requires the Company to estimate the fair value of stock-based payment awards to employees and non-employees on the date of grant using an option pricing model. Stock based compensation costs are based on the fair value of the underlying option calculated using the Black Scholes option pricing model and recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Restricted stock unit awards are valued based on the closing trading value of the Company’s common stock on the date of grant and then amortized on a straight-line basis over the requisite service period of the award. The Company measures equity-based compensation awards granted to non-employees at fair value as the awards vest and recognizes the resulting value as compensation expense at each financial reporting period. Determining the appropriate fair value model and related assumptions requires judgment, including estimating stock price volatility, expected dividend yield, expected term, risk free rate of return, and the estimated fair value of the underlying common stock. Due to the lack of company specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. The group of representative companies have characteristics similar to the Company, including stage of product development and focus on the lithium ion battery industry. The Company uses the simplified method, which is the average of the final vesting tranche date and the contractual term, to calculate the expected term for options granted to employees as it does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected term of the stock options. The Company uses an assumed dividend yield of zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. The Company accounts for forfeitures as they occur. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Income Taxes Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss, credit carryforwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. The Company recognizes a tax benefit for an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The Company has a liability of $128 and $128 as of March 31, 2023, and December 31, 2022, respectively, of uncertain tax positions. The Company’s accounting policy is to include penalties and interest related to income taxes if any, in selling, general and administrative expenses. Segment Reporting Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the Company’s Chief Executive Officer to make decisions with respect to resource allocation and assessment of performance. To date, the Company has viewed its operations and manages its business as one operating segment.

Principles of consolidation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and present the consolidated financial statements of the Company and its wholly owned subsidiary. All significant intercompany transactions and balances are eliminated in consolidation.

Basis of presentation The accompanying unaudited condensed consolidated financial statements and related notes have been prepared in accordance with U.S. GAAP for interim financial information, and with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) set forth in Article 8 of Regulation S X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The unaudited interim financial statements furnished reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented. Unaudited interim results are not necessarily indicative of the results for the full fiscal year. These financial statements should be read along with the Annual Report filed of the Company for the annual period ended December 31, 2022. The consolidated balance sheet as of December 31, 2022 was derived from the audited consolidated financial statements as of and for the year then ended. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data)

Going Concern The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. For the three months ended March 31, 2023 and 2022, the Company incurred loss from operations and had negative cash flow from operations. As of March 31, 2023, the Company had $15,791 in cash and cash equivalents and working capital of $24,533. The Company’s ability to achieve profitability and positive cash flow depends on its ability to increase revenue, contain its expenses and maintain compliance with the financial covenants in its outstanding indebtedness agreements. In connection with the Company’s senior secured term loan facility in an aggregate principal amount of $<span id="xdx_907_eus-gaap--DebtInstrumentFaceAmount_iI_pn3n3_c20230331__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--LongtermDebtTypeAxis__custom--TermLoanMember_z3kkj2CFzOZ6" title="Loan amount">75,000 (the “Term Loan”), the Company is obligated to comply with certain financial covenants, which include maintaining a maximum senior leverage ratio, minimum liquidity, a springing fixed charge coverage ratio, and maximum capital expenditures (See Note 6). On March 29, 2023, the Company obtained a waiver from the Term Loan administrative agent and lenders of its failures to satisfy the fixed charge coverage ratio and maximum senior leverage ratio with respect to the minimum cash requirements under the Term Loan during the quarter ended March 31, 2023. It is probable that the Company will fail to meet these covenants within the next twelve months. If the Company is unable to obtain a waiver or if the Company is unable to comply with such covenants, the lenders have the right to accelerate the maturity of the Term Loan. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. In addition, the Company may need to raise additional debt and/or equity financings to fund our operations, strategic plans, and meet its financial covenants. The Company has historically been able to raise additional capital through issuance of equity and/or debt financings and the Company intends to use its equity facility and raise additional capital as needed. However, the Company cannot guarantee that it will be able to raise additional equity, contain expenses, or increase revenue, and comply with the financial covenants under the Term Loan.

15791000

24533000

75000000

Recently adopted accounting standards: In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The FASB subsequently issued amendments to ASU 2016-13, which have the same effective date and transition date of January 1, 2023. These standards replace the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measure at amortized cost to be presented at the net amount expected to be collected. The Company determined that this change does not have a material impact to the financial statements or financial statement disclosures.

Recently issued accounting pronouncements: In August 2020, FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. The amendments in this update will be effective for the Company on January 1, 2024. The Company is currently assessing the impact, if any, that ASU 2020-06 would have on its financial position, results of operations or cash flows. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Accounts Receivable The Company’s trade receivables are recorded when billed and represent claims against third parties that will be settled in cash. Generally, payment is due from customers within 30 – 60 days of the invoice date and the contracts do not have significant financing components. Trade accounts receivables are recorded gross and are net of any applicable allowance. The Company has an allowance for doubtful accounts as of March 31, 2023 and December 31, 2022 of $116 and $90, respectively.

30 – 60 days

116000

90000

Inventory Inventories (Note 4), which consist of raw materials and finished goods, are stated at the lower of cost (first in, first out) or net realizable value, net of reserves for obsolete inventory. We continually analyze our slow moving and excess inventories. Based on historical and projected sales volumes and anticipated selling prices, we established reserves. Inventory that is in excess of current and projected use is reduced by an allowance to a level that approximates its estimate of future demand. Products that are determined to be obsolete are written down to net realizable value. As of March 31, 2023 and December 31, 2022, no such reserves were necessary.

Property and Equipment Property and equipment are stated at cost, including the cost of significant improvements and renovations. Costs of routine repairs and maintenance are charged to expense as incurred. Depreciation and amortization are calculated by the straight line method over the estimated useful lives for owned property, or, for leasehold improvements, over the shorter of the asset’s useful life or term of the lease. Depreciation expense for the three months ended March 31, 2023 and 2022 was $297 and $192, respectively. The various classes of property and equipment and estimated useful lives are as follows: SCHEDULE OF VARIOUS CLASSES OF PROPERTY AND EQUIPMENT AND ESTIMATED USEFUL LIVES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; width: 80%; border-collapse: collapse; margin-right: auto"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left; width: 50%">Office furniture and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; width: 50%; text-align: center"><span id="xdx_905_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MinimumMember_zMQGWFWO0s5a" title="Estimated useful life (in years)">3 to <span id="xdx_90D_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MaximumMember_zzuZHMe6tG3" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Vehicles</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">5 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Machinery and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90B_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MinimumMember_zSrKebM5JOPf" title="Estimated useful life (in years)">3 to <span id="xdx_903_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MaximumMember_zAI3NtBwyOEi" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Leasehold improvements</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90C_eus-gaap--PropertyPlantAndEquipmentUsefulLifeDescriptionOfTermExtensibleEnumeration_iI_dxL_c20230331_zWVxy8OouPD9" title="::XDX::http%3A%2F%2Ffasb.org%2Fus-gaap%2F2023%23LeaseholdImprovementsMember">Remaining Term of Lease</td></tr> </table>

297000

192000

SCHEDULE OF VARIOUS CLASSES OF PROPERTY AND EQUIPMENT AND ESTIMATED USEFUL LIVES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; width: 80%; border-collapse: collapse; margin-right: auto"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left; width: 50%">Office furniture and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; width: 50%; text-align: center"><span id="xdx_905_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MinimumMember_zMQGWFWO0s5a" title="Estimated useful life (in years)">3 to <span id="xdx_90D_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--FurnitureAndFixturesMember__srt--RangeAxis__srt--MaximumMember_zzuZHMe6tG3" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Vehicles</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center">5 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Machinery and equipment</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90B_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MinimumMember_zSrKebM5JOPf" title="Estimated useful life (in years)">3 to <span id="xdx_903_eus-gaap--PropertyPlantAndEquipmentUsefulLife_iI_dtY_c20230331__us-gaap--PropertyPlantAndEquipmentByTypeAxis__us-gaap--MachineryAndEquipmentMember__srt--RangeAxis__srt--MaximumMember_zAI3NtBwyOEi" title="Estimated useful life (in years)">7 years</td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: left">Leasehold improvements</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: center"><span id="xdx_90C_eus-gaap--PropertyPlantAndEquipmentUsefulLifeDescriptionOfTermExtensibleEnumeration_iI_dxL_c20230331_zWVxy8OouPD9" title="::XDX::http%3A%2F%2Ffasb.org%2Fus-gaap%2F2023%23LeaseholdImprovementsMember">Remaining Term of Lease</td></tr> </table>

P3Y

P7Y

P5Y

P3Y

P7Y

Use of Estimates The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Warrants The Company applies relevant accounting guidance for warrants to purchase the Company’s stock based on the nature of the relationship with the counterparty. For warrants issued to investors or lenders in exchange for cash or other financial assets, the Company follows guidance issued within Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 815, Derivatives and Hedging (“ASC 815”), to assist in the determination of whether the warrants should be classified as liabilities or equity. Warrants that are determined to require liability classification are measured at fair value upon issuance and are subsequently remeasured to their then fair value at each subsequent reporting period with changes in fair value recorded in current earnings. Warrants that are determined to require equity classification are measured at fair value upon issuance and are not subsequently remeasured unless they are required to be reclassified. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Revenue Recognition Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Revenue is recognized when control of the promised goods is transferred to the customer or reseller, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods and services. Revenue associated with products holding rights of return are recognized when the Company concludes there is not a risk of significant revenue reversal in the future periods for the expected consideration in the transaction. There are no material instances including discounts and refunds where variable consideration is constrained and not recorded at the initial time of sale. Generally, our revenue is recognized at a point in time for standard promised goods at the time of shipment when title and risk of loss pass to the customer. The Company may receive payments at the onset of the contract before delivery of goods for customers in the retail channel. Payment terms for distributors and OEMs are typically due within <span id="xdx_90D_ecustom--PaymentTermForDistributorsAndOriginalEquipmentManufacturers_dtD_c20230101__20230331__srt--RangeAxis__srt--MinimumMember_zPiIygHy9Yf7" title="Payment term for distributors and OEMs">30-<span id="xdx_90D_ecustom--PaymentTermForDistributorsAndOriginalEquipmentManufacturers_dtD_c20230101__20230331__srt--RangeAxis__srt--MaximumMember_z6FQIBHn4NO2" title="Payment term for distributors and OEMs">60 days after shipment. In such instances, the Company records a customer deposit liability. The Company recognizes these contract liabilities as sales after the revenue criteria are met. As of March 31, 2023 and December 31, 2022, the contract liability related to the Company’s customer deposits approximated $418 and $238, respectively. The Company recognized $211 of contract liability pertaining to the year ended December 31, 2022 as of March 31, 2023. The entire contract liability balance of $434 as of January 1, 2022 was recognized as revenue during the three months ended March 31, 2022.

P30D P60D

418000

238000

211000

434

Disaggregation of Revenue The following table present our disaggregated revenues by distribution channel: SCHEDULE OF DISAGGREGATED REVENUES BY DISTRIBUTION CHANNEL <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 80%; margin-right: auto"> <tr style="display: none; vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49B_20230101__20230331_zDh8SMW3SKw2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49E_20220101__20220331_zfgcpoWhMCAg" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: Black 1.5pt solid; text-align: center">For the Three Months Ended March 31,</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Sales</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelDirectlyToConsumerMember_z77U9QQP25Q2" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 64%">Retail</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">7,069</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">13,035</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40B_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelThroughIntermediaryMember_zZ8MI91bkmu6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Distributor</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,968</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,087</td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__custom--OriginalEquipmentManufactureMember_zPlejtRyHPTk" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1.5pt">Original equipment manufacture</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">8,754</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,181</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zd4Zmm7Dtl71" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zvqw9TEMaroc" style="display: none; vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total sales</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

The following table present our disaggregated revenues by distribution channel: SCHEDULE OF DISAGGREGATED REVENUES BY DISTRIBUTION CHANNEL <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 80%; margin-right: auto"> <tr style="display: none; vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49B_20230101__20230331_zDh8SMW3SKw2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49E_20220101__20220331_zfgcpoWhMCAg" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="6" style="border-bottom: Black 1.5pt solid; text-align: center">For the Three Months Ended March 31,</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt"/><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Sales</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelDirectlyToConsumerMember_z77U9QQP25Q2" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; width: 64%">Retail</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">7,069</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 14%; text-align: right">13,035</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40B_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__us-gaap--SalesChannelThroughIntermediaryMember_zZ8MI91bkmu6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt">Distributor</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,968</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">2,087</td><td style="text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_hus-gaap--ContractWithCustomerSalesChannelAxis__custom--OriginalEquipmentManufactureMember_zPlejtRyHPTk" style="vertical-align: bottom; background-color: White"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 1.5pt">Original equipment manufacture</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">8,754</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,181</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zd4Zmm7Dtl71" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--RevenueFromContractWithCustomerExcludingAssessedTax_pn3n3_zvqw9TEMaroc" style="display: none; vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 20pt; padding-bottom: 2.5pt">Total sales</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,791</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">18,303</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

7069000

13035000

2968000

2087000

8754000

3181000

18791000

18303000

18791000

18303000

Shipping and Handling Shipping and handling fees paid by customers are recorded within net sales, with the related expenses recorded in cost of sales. Shipping and handling costs associated with outbound freight are included in sales and marketing expenses. Shipping and handling costs associated with outbound freight totaled $1,007 and $1,228 for the three months ended March 31, 2023 and 2022, respectively. 1007000 1228000 Product Warranty The Company offers assurance type warranties from 5 to 10 years on its products. The Company estimates the costs associated with the warranty obligation using historical data of warranty claims and costs incurred to satisfy those claims. The Company estimates, based upon a review of historical warranty claim experience, the costs that may be incurred under our warranties and record a liability in the amount of such estimate at the time a product is sold. Factors that affect our warranty liability include the number of units sold, historical and anticipated rates of warranty claims, and cost per claim. We periodically assess the adequacy of our recorded warranty liability and adjust the accrual as claims data and historical experience warrants. The Company has assessed the costs of fulfilling its existing assurance type warranties and has determined that the estimated outstanding warranty obligation on March 31, 2023 and December 31, 2022 to be $400 and $328, respectively. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) P5Y P10Y

400000

328000

Concentrations Receivables from one customer comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zv8JM5Fsiluh" title="Concentration risk, percentage">50% of accounts receivable as of March 31, 2023. Receivables from three customers comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zlaBf7yBMkNe" title="Concentration risk, percentage">18%, <span id="xdx_904_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerTwoMember_znzMtNJn8I5c" title="Concentration risk, percentage">10% and <span id="xdx_902_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsReceivableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CreditConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerThreeMember_zkst5ZnN0OEf" title="Concentration risk, percentage">10%, respectively, of accounts receivable as of December 31, 2022. There are no other significant accounts receivable concentration. Sales from <span id="xdx_905_ecustom--NumberOfVendors_pid_dc_uCustomer_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember_zAynJ5pJgL11" title="Number of vendors">one customer comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomerOneMember_zWvUejsSgwX4" title="Concentration risk, percentage">26% of revenue for the three months ended March 31, 2023. There were no significant revenue concentrations for the three months ended March 31, 2022. Payables to <span id="xdx_90E_ecustom--NumberOfCustomers_pid_dc_uCustomer_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zaq5BlZQajog" title="Number of vendors">one vendor comprised approximately <span id="xdx_90F_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorMember_zYGGrdBYvFfe" title="Concentration risk, percentage">67% of accounts payables as of March 31, 2023. Payables to <span id="xdx_902_ecustom--NumberOfCustomers_pid_dc_uCustomer_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zF7s2KaHWKP" title="Number of vendors">one vendor comprised approximately <span id="xdx_90D_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20221231__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--AccountsPayableMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorMember_zA9BOpCKcOWi" title="Concentration risk, percentage">61% of accounts payables as of December 31, 2022. For the three months ended March 31, 2023, <span id="xdx_903_ecustom--NumberOfVendors_pid_dc_uVendor_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zRsiyK8ACbI3" title="Number of vendors">two vendors accounted for approximately <span id="xdx_90B_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorOneMember_zlyLbQDP9KJi" title="Concentration risk, percentage">38% and <span id="xdx_908_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20230101__20230331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorTwoMember_zVHrRNxpkK8e" title="Concentration risk, percentage">10%, respectively, of the Company’s total purchases. For the three months ended March 31, 2022, <span id="xdx_90F_ecustom--NumberOfVendors_pid_dc_uVendor_c20220101__20220331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember_zdeVuA8a4tU9" title="Number of vendors">one vendor accounted for approximately <span id="xdx_901_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20220101__20220331__us-gaap--ConcentrationRiskByBenchmarkAxis__custom--TotalPurchasesMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--SupplierConcentrationRiskMember__srt--MajorCustomersAxis__custom--OneVendorMember_zgavPUxPMXb9" title="Concentration risk, percentage">34% of the Company’s total purchases.

0.50

0.18

0.10

0.26

0.67

0.61

0.38

0.10

0.34

Advertising The Company expenses advertising costs as they are incurred and are included in selling and marketing expenses. Advertising expenses amounted to $587 and $781 for the three months ended March 31, 2023, and 2022, respectively.

587000

781000

Stock-Based Compensation The Company accounts for stock-based compensation arrangements with employees and non-employee consultants using a fair value method which requires the recognition of compensation expense for costs related to all stock-based payments, including stock options (Note 11). The fair value method requires the Company to estimate the fair value of stock-based payment awards to employees and non-employees on the date of grant using an option pricing model. Stock based compensation costs are based on the fair value of the underlying option calculated using the Black Scholes option pricing model and recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Restricted stock unit awards are valued based on the closing trading value of the Company’s common stock on the date of grant and then amortized on a straight-line basis over the requisite service period of the award. The Company measures equity-based compensation awards granted to non-employees at fair value as the awards vest and recognizes the resulting value as compensation expense at each financial reporting period. Determining the appropriate fair value model and related assumptions requires judgment, including estimating stock price volatility, expected dividend yield, expected term, risk free rate of return, and the estimated fair value of the underlying common stock. Due to the lack of company specific historical and implied volatility data, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. The group of representative companies have characteristics similar to the Company, including stage of product development and focus on the lithium ion battery industry. The Company uses the simplified method, which is the average of the final vesting tranche date and the contractual term, to calculate the expected term for options granted to employees as it does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected term of the stock options. The Company uses an assumed dividend yield of zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. The Company accounts for forfeitures as they occur. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Income Taxes Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss, credit carryforwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. The Company recognizes a tax benefit for an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. The Company has a liability of $128 and $128 as of March 31, 2023, and December 31, 2022, respectively, of uncertain tax positions. The Company’s accounting policy is to include penalties and interest related to income taxes if any, in selling, general and administrative expenses.

128000

Segment Reporting Operating segments are identified as components of an enterprise for which separate discrete financial information is available for evaluation by the Company’s Chief Executive Officer to make decisions with respect to resource allocation and assessment of performance. To date, the Company has viewed its operations and manages its business as one operating segment.

NOTE 3 - FAIR VALUE MEASUREMENTS ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the 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 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. ASC 820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a three-tier fair value hierarchy that distinguishes between the following: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse"> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify; width: 0.25in">●</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"> </td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"> </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">●</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for a similar asset or liability, either directly or indirectly. </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"> </td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify"> </td></tr> <tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">●</td> <td style="font: 10pt Times New Roman, Times, Serif; text-align: justify">Level 3 inputs are unobservable inputs that reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset or liability.</td></tr> </table> Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 3 - FAIR VALUE MEASUREMENTS (CONTINUED) The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of March 31, 2023: SCHEDULE OF FAIR VALUE, ASSETS AND LIABILITIES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Carrying Amount</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Fair Value</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 1)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 2)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 3)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="18" style="border-bottom: Black 1.5pt solid; text-align: center">As of March 31, 2023</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-decoration: underline">Liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 35%; text-align: left">Warrant liability- Term Loan</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_989_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zqzpLGyGrSx2" style="width: 9%; text-align: right" title="Carrying Amount">4,021</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zKo1h44mlbY2" style="width: 9%; text-align: right">4,021</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zYnbc2AvmST7" style="width: 9%; text-align: right"> -</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98D_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zHKnmkOiEEW" style="width: 9%; text-align: right">-</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_989_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zlD27mdy3myb" style="width: 9%; text-align: right">4,021</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt; text-align: left">Warrant liability- Private placement warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_985_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zwIOzxRyUw8g" style="border-bottom: Black 1.5pt solid; text-align: right" title="Carrying Amount">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_989_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z8SBK34cSDTa" style="border-bottom: Black 1.5pt solid; text-align: right">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_981_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z2RnlnLeXktl" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_985_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z7DsjGnod4y9" style="border-bottom: Black 1.5pt solid; text-align: right">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zeYc7p0vrhm5" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_981_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zn5lB4tyU2i" style="border-bottom: Black 2.5pt double; text-align: right" title="Carrying Amount">4,141</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zkmjSKW0MSeh" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">4,141</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member_zkTvBFdLWO4g" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">-</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member_z6FITvOp6rp3" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">120</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_987_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member_zuPjpAfkA7e7" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">4,021</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of December 31, 2022: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Carrying Amount</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Fair Value</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 1)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 2)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 3)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="18" style="border-bottom: Black 1.5pt solid; text-align: center">As of December 31, 2022</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-decoration: underline">Liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 35%; text-align: left">Warrant liability- Term Loan</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zO76d90TG7p6" style="width: 9%; text-align: right" title="Carrying Amount">30,841</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_980_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zBtClYQoiXIh" style="width: 9%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_z3ZnbaL8Bux1" style="width: 9%; text-align: right"> -</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_988_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zPnuuXhqRhua" style="width: 9%; text-align: right">-</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zxVHKvp1Cdr" style="width: 9%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt; text-align: left">Warrant liability- Private placement warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_984_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z24ts2E7ty5g" style="border-bottom: Black 1.5pt solid; text-align: right" title="Carrying Amount">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_ztA0E2VdnTa" style="border-bottom: Black 1.5pt solid; text-align: right">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zMnBjBiStjD3" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98A_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zf51nb23Vdne" style="border-bottom: Black 1.5pt solid; text-align: right">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zgfO34gegOd8" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt; text-align: left">Total liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zJHmqgDmoIw2" style="border-bottom: Black 2.5pt double; text-align: right" title="Carrying Amount">32,831</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_985_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_z6sDcuWMwp18" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">32,831</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98B_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member_zPBTxiibAoRk" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">-</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_988_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member_z9a5KBYKvDtd" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">1,990</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member_zmKoGG5rzBnj" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">30,841</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> The carrying amounts of accounts receivable and accounts payable are considered level 1 and approximate fair value as of March 31, 2023 and December 31, 2022 because of the relatively short maturity of these instruments. The carrying value of the term loan as of March 31, 2023 and December 31, 2022 approximates fair value as the interest rate does not differ significantly from the current market rates available to the Company for similar debt and is considered level 2. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data)

The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of March 31, 2023: SCHEDULE OF FAIR VALUE, ASSETS AND LIABILITIES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Carrying Amount</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Fair Value</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 1)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 2)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 3)</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="18" style="border-bottom: Black 1.5pt solid; text-align: center">As of March 31, 2023</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-decoration: underline">Liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 35%; text-align: left">Warrant liability- Term Loan</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_989_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zqzpLGyGrSx2" style="width: 9%; text-align: right" title="Carrying Amount">4,021</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zKo1h44mlbY2" style="width: 9%; text-align: right">4,021</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zYnbc2AvmST7" style="width: 9%; text-align: right"> -</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98D_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zHKnmkOiEEW" style="width: 9%; text-align: right">-</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_989_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zlD27mdy3myb" style="width: 9%; text-align: right">4,021</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt; text-align: left">Warrant liability- Private placement warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_985_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zwIOzxRyUw8g" style="border-bottom: Black 1.5pt solid; text-align: right" title="Carrying Amount">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_989_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z8SBK34cSDTa" style="border-bottom: Black 1.5pt solid; text-align: right">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_981_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z2RnlnLeXktl" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_985_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z7DsjGnod4y9" style="border-bottom: Black 1.5pt solid; text-align: right">120</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zeYc7p0vrhm5" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_981_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zn5lB4tyU2i" style="border-bottom: Black 2.5pt double; text-align: right" title="Carrying Amount">4,141</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zkmjSKW0MSeh" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">4,141</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member_zkTvBFdLWO4g" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">-</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member_z6FITvOp6rp3" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">120</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_987_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20230331__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member_zuPjpAfkA7e7" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">4,021</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> The following table presents assets and liabilities that were measured at fair value in the Consolidated Balance Sheets on a recurring basis as of December 31, 2022: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Carrying Amount</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Fair Value</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 1)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 2)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td><td style="padding-bottom: 1.5pt; text-align: center"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">(Level 3)</td><td style="padding-bottom: 1.5pt; text-align: center"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td colspan="18" style="border-bottom: Black 1.5pt solid; text-align: center">As of December 31, 2022</td><td style="text-align: center; padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-decoration: underline">Liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="width: 35%; text-align: left">Warrant liability- Term Loan</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zO76d90TG7p6" style="width: 9%; text-align: right" title="Carrying Amount">30,841</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_980_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zBtClYQoiXIh" style="width: 9%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_z3ZnbaL8Bux1" style="width: 9%; text-align: right"> -</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_988_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zPnuuXhqRhua" style="width: 9%; text-align: right">-</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98E_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--TermLoanMember_zxVHKvp1Cdr" style="width: 9%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt; text-align: left">Warrant liability- Private placement warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_984_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_z24ts2E7ty5g" style="border-bottom: Black 1.5pt solid; text-align: right" title="Carrying Amount">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_983_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_ztA0E2VdnTa" style="border-bottom: Black 1.5pt solid; text-align: right">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zMnBjBiStjD3" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98A_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zf51nb23Vdne" style="border-bottom: Black 1.5pt solid; text-align: right">1,990</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member__us-gaap--FinancialInstrumentAxis__custom--PrivateWarrantsMember_zgfO34gegOd8" style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt; text-align: left">Total liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_ecustom--LiabilitiesCarryingValue_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_zJHmqgDmoIw2" style="border-bottom: Black 2.5pt double; text-align: right" title="Carrying Amount">32,831</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_985_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember_z6sDcuWMwp18" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">32,831</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98B_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel1Member_zPBTxiibAoRk" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">-</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_988_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel2Member_z9a5KBYKvDtd" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">1,990</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iI_pn3n3_c20221231__us-gaap--FairValueByMeasurementFrequencyAxis__us-gaap--FairValueMeasurementsRecurringMember__us-gaap--FairValueByFairValueHierarchyLevelAxis__us-gaap--FairValueInputsLevel3Member_zmKoGG5rzBnj" style="border-bottom: Black 2.5pt double; text-align: right" title="Fair Value">30,841</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

4021000

120000

4141000

120000

4021000

30841000

1990000

32831000

1990000

30841000

NOTE 4 - INVENTORY Inventory consists of the following: SCHEDULE OF INVENTORY <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_491_20230331_zZonenmg2m6h" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_496_20221231_zR1sdcuYZc8l" style="border-bottom: Black 1.5pt solid; text-align: center">December 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_404_eus-gaap--InventoryRawMaterials_iI_pn3n3_maINzAGF_z8waZ1DDvFuf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%; text-align: left">Raw material</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">44,310</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">42,586</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--InventoryFinishedGoods_iI_pn3n3_maINzAGF_zYYMni8W5f9j" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Finished goods</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7,502</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7,260</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40B_eus-gaap--InventoryNet_iTI_pn3n3_mtINzAGF_zWp8chZIVXIc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 2.5pt">Total inventory</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">51,812</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">49,846</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

Inventory consists of the following: SCHEDULE OF INVENTORY <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_491_20230331_zZonenmg2m6h" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_496_20221231_zR1sdcuYZc8l" style="border-bottom: Black 1.5pt solid; text-align: center">December 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_404_eus-gaap--InventoryRawMaterials_iI_pn3n3_maINzAGF_z8waZ1DDvFuf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%; text-align: left">Raw material</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">44,310</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">42,586</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--InventoryFinishedGoods_iI_pn3n3_maINzAGF_zYYMni8W5f9j" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Finished goods</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7,502</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">7,260</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40B_eus-gaap--InventoryNet_iTI_pn3n3_mtINzAGF_zWp8chZIVXIc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-left: 10pt; text-align: left; padding-bottom: 2.5pt">Total inventory</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">51,812</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">49,846</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

44310000

42586000

7502000

7260000

51812000

49846000

NOTE 5 - COMMITMENTS AND CONTINGENCIES Litigation From time to time the Company may be named in claims arising in the ordinary course of business. Currently, no legal proceedings, governmental actions, administrative actions, investigations or claims are pending against the Company or involve the Company that, in the opinion of the Company’s management, could reasonably be expected to have a material adverse effect on the Company’s business and financial condition. Operating Leases The Company has leases related to the main office, warehouse space, research and development lab, and engineering office, all located in Reno, Nevada. The leases require annual escalating monthly payments ranging from $111 to $128. On February 2, 2022, the Company entered into a 124-month lease agreement in Reno, Nevada. The lease calls for monthly base rent of $230, $23 of fixed operating expense costs, and estimated monthly property taxes of $21. The monthly base rent and fixed operating expense costs are subject to escalation of 3% and 2.4%, respectively, on an annual basis. The first payment is due upon substantial completion of construction of the building which is expected to be within 2 years from the effective date. As of March 31, 2023, the lease has not commenced as the Company does not have control over the asset. The following table presents the breakout of the operating leases as of: SCHEDULE OF TABLE REPRESENTING THE BREAKOUT OF THE OPERATING LEASES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49F_20230331_zACeMGMctnNc" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_495_20221231_zANCg23cSCge" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">December 31, 2022</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr id="xdx_40E_eus-gaap--OperatingLeaseRightOfUseAsset_iI_pn3n3_zPlyyaq0Jjy6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%; text-align: left; padding-bottom: 1.5pt">Operating lease right-of-use assets</td><td style="width: 2%; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; width: 1%; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; width: 20%; text-align: right">4,205</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; width: 1%; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; width: 20%; text-align: right"> 4,513</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--OperatingLeaseLiabilityCurrent_iI_pn3n3_z85cObV2mfS2" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Short-term operating lease liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,215</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,188</td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--OperatingLeaseLiabilityNoncurrent_iI_pn3n3_zf6vU595IXWk" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Long-term operating lease liabilities</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,209</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,541</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--OperatingLeaseLiability_iI_pn3n3_zq22qa2rapsh" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total operating lease liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,424</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,729</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average remaining lease term</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3.4 years</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3.6 years</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Weighted average discount rate</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.2</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.2</td><td style="text-align: left">%</td></tr> </table> Assumptions used in determining our incremental borrowing rate include our implied credit rating and an estimate of secured borrowing rates based on comparable market data. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 5 - COMMITMENTS AND CONTINGENCIES (CONTINUED) Operating Leases (Continued) At March 31, 2023, the future minimum lease payments under these operating leases are as follows: SCHEDULE OF THE FUTURE MINIMUM LEASE PAYMENTS UNDER THE OPERATING LEASES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 60%; margin-right: auto"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; font-weight: bold">Fiscal Years Ending</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td> <td colspan="2" id="xdx_497_20230331_z8HxzJVxLVB" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Amount</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr id="xdx_406_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths_iI_pn3n3_maLOLLPz07u_zy0EueSgorw8" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">December 31, 2023 (1)</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">1,054</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearTwo_iI_pn3n3_maLOLLPz07u_zZD0tc5gpHj4" style="vertical-align: bottom; background-color: White"> <td>December 31, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,435</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearThree_iI_pn3n3_maLOLLPz07u_zAcyRTvbdzql" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,435</td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFour_iI_pn3n3_maLOLLPz07u_zUWmxSxdurLj" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1.5pt">December 31, 2026</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">893</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_408_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDue_iTI_pn3n3_mtLOLLPz07u_za7LLTofjf0a" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Total lease payments</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">4,817</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--LesseeOperatingLeaseLiabilityUndiscountedExcessAmount_iI_pn3n3_zc0452PZTzF2" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Less imputed interest</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">393</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--OperatingLeaseLiability_iI_pn3n3_zIWDQgL4jcDa" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total operating lease liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,424</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0; margin-bottom: 0"><tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in"/><td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Represents scheduled payments for the remaining nine-month period ending December 31, 2023.</td></tr></table> SCHEDULE OF LEASE COST <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td style="border-bottom: Black 1.5pt solid; text-align: center">Lease cost</td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: center">Classification</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2023</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold"> </td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2022</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 33%; text-align: left">Operating lease cost</td><td style="width: 2%"> </td> <td style="width: 33%; text-align: left">Cost of goods sold</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--CostOfSalesMember_z63ygxF5ps0b" style="width: 12%; text-align: right" title="Operating lease cost">347</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--CostOfSalesMember_zesQsalUvzMi" style="width: 12%; text-align: right" title="Operating lease cost">172</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Operating lease cost</td><td> </td> <td style="text-align: left">Research and development</td><td> </td> <td style="text-align: left"> </td><td id="xdx_988_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_zLd57usdsx3f" style="text-align: right" title="Operating lease cost">22</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_985_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_zchfdXypepj8" style="text-align: right" title="Operating lease cost">19</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Operating lease cost</td><td> </td> <td style="text-align: left">General and administration</td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_zk7ypUqDXTe9" style="text-align: right" title="Operating lease cost">12</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_z3rr5ch7nwkg" style="text-align: right" title="Operating lease cost">10</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Operating lease cost</td><td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; padding-bottom: 2.5pt">Selling and marketing</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_981_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zKclS3lJPD8d" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">12</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_989_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zP32b88jIBSf" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">14</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total lease cost</td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331_zAFTTtVeNJXk" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">393</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331_zn73SNKW6gKb" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">215</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> Earnout The former holders of shares of Legacy Dragonfly common stock (including shares received as a result of the conversion of Legacy Dragonfly Preferred Stock into New Dragonfly Common Stock) are entitled to receive their pro rata share of up to 40,000,000 additional shares of common stock (the “Earnout Shares”). The Earnout Shares are issuable in three tranches. The first tranche of 15,000,000 shares is issuable if New Dragonfly’s 2023 total audited revenue is equal to or greater than $250,000 and New Dragonfly’s 2023 audited operating income is equal to or greater than $35,000. The second tranche of 12,500,000 shares is issuable upon achieving a volume-weighted average trading price threshold of at least $<span id="xdx_909_ecustom--VolumeWeightedAveragePricePerShare_pid_c20230101__20230331__us-gaap--RelatedPartyTransactionsByRelatedPartyAxis__custom--HoldersOfOutstandingSharesOfLegacyDragonflyCommonStockMember__us-gaap--VestingAxis__us-gaap--ShareBasedCompensationAwardTrancheTwoMember_zTNPc4UTGkNh" title="Volume weighted average price per share">22.50 on or prior to December 31, 2026 and the third tranche of 12,500,000 is issuable upon achieving a volume-weighted average trading price threshold of at least $<span id="xdx_903_ecustom--VolumeWeightedAveragePricePerShare_pid_c20230101__20230331__us-gaap--RelatedPartyTransactionsByRelatedPartyAxis__custom--HoldersOfOutstandingSharesOfLegacyDragonflyCommonStockMember__us-gaap--VestingAxis__us-gaap--ShareBasedCompensationAwardTrancheThreeMember_zGmA3nXanCnk" title="Volume weighted average price per share">32.50 on or prior to December 31, 2028. To the extent not previously earned, the second tranche is issuable if the $<span id="xdx_909_ecustom--VolumeWeightedAveragePricePerShare_pid_c20230101__20230331__us-gaap--VestingAxis__us-gaap--ShareBasedCompensationAwardTrancheTwoMember_zAafiMJEqqQa" title="Volume weighted average price per share">32.50 price target is achieved by December 31, 2028. Other Contingencies See Note 7 for further discussion regarding contingent consideration arising from the April 2022 asset purchase agreement with Thomason Jones Company, LLC. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data)

111000

128000

230000

23000

21000 0.03 0.024 P2Y The following table presents the breakout of the operating leases as of: SCHEDULE OF TABLE REPRESENTING THE BREAKOUT OF THE OPERATING LEASES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49F_20230331_zACeMGMctnNc" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td><td style="font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_495_20221231_zANCg23cSCge" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">December 31, 2022</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr id="xdx_40E_eus-gaap--OperatingLeaseRightOfUseAsset_iI_pn3n3_zPlyyaq0Jjy6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%; text-align: left; padding-bottom: 1.5pt">Operating lease right-of-use assets</td><td style="width: 2%; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; width: 1%; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; width: 20%; text-align: right">4,205</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; width: 1%; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; width: 20%; text-align: right"> 4,513</td><td style="width: 1%; padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--OperatingLeaseLiabilityCurrent_iI_pn3n3_z85cObV2mfS2" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Short-term operating lease liabilities</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,215</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,188</td><td style="text-align: left"> </td></tr> <tr id="xdx_401_eus-gaap--OperatingLeaseLiabilityNoncurrent_iI_pn3n3_zf6vU595IXWk" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Long-term operating lease liabilities</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,209</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,541</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--OperatingLeaseLiability_iI_pn3n3_zq22qa2rapsh" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total operating lease liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,424</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,729</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average remaining lease term</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3.4 years</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3.6 years</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Weighted average discount rate</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.2</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">5.2</td><td style="text-align: left">%</td></tr> </table>

4205000

4513000

1215000

1188000

3209000

3541000

4424000

4729000

P3Y4M24D

P3Y7M6D

0.052

At March 31, 2023, the future minimum lease payments under these operating leases are as follows: SCHEDULE OF THE FUTURE MINIMUM LEASE PAYMENTS UNDER THE OPERATING LEASES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 60%; margin-right: auto"> <tr style="vertical-align: bottom"> <td style="padding-bottom: 1.5pt; font-weight: bold">Fiscal Years Ending</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td> <td colspan="2" id="xdx_497_20230331_z8HxzJVxLVB" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">Amount</td><td style="padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr id="xdx_406_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths_iI_pn3n3_maLOLLPz07u_zy0EueSgorw8" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">December 31, 2023 (1)</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">1,054</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearTwo_iI_pn3n3_maLOLLPz07u_zZD0tc5gpHj4" style="vertical-align: bottom; background-color: White"> <td>December 31, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,435</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearThree_iI_pn3n3_maLOLLPz07u_zAcyRTvbdzql" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">1,435</td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDueYearFour_iI_pn3n3_maLOLLPz07u_zUWmxSxdurLj" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1.5pt">December 31, 2026</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">893</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_408_eus-gaap--LesseeOperatingLeaseLiabilityPaymentsDue_iTI_pn3n3_mtLOLLPz07u_za7LLTofjf0a" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Total lease payments</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">4,817</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--LesseeOperatingLeaseLiabilityUndiscountedExcessAmount_iI_pn3n3_zc0452PZTzF2" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Less imputed interest</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">393</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--OperatingLeaseLiability_iI_pn3n3_zIWDQgL4jcDa" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total operating lease liabilities</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,424</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0; margin-bottom: 0"><tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in"/><td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Represents scheduled payments for the remaining nine-month period ending December 31, 2023.</td></tr></table>

1054000

1435000

893000

4817000

393000

4424000

SCHEDULE OF LEASE COST <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td style="border-bottom: Black 1.5pt solid; text-align: center">Lease cost</td><td style="text-align: center; padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: center">Classification</td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2023</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold"> </td><td style="text-align: center; font-weight: bold; padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center">March 31, 2022</td><td style="text-align: center; padding-bottom: 1.5pt; font-weight: bold"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 33%; text-align: left">Operating lease cost</td><td style="width: 2%"> </td> <td style="width: 33%; text-align: left">Cost of goods sold</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98B_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--CostOfSalesMember_z63ygxF5ps0b" style="width: 12%; text-align: right" title="Operating lease cost">347</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--CostOfSalesMember_zesQsalUvzMi" style="width: 12%; text-align: right" title="Operating lease cost">172</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Operating lease cost</td><td> </td> <td style="text-align: left">Research and development</td><td> </td> <td style="text-align: left"> </td><td id="xdx_988_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_zLd57usdsx3f" style="text-align: right" title="Operating lease cost">22</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_985_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_zchfdXypepj8" style="text-align: right" title="Operating lease cost">19</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Operating lease cost</td><td> </td> <td style="text-align: left">General and administration</td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_zk7ypUqDXTe9" style="text-align: right" title="Operating lease cost">12</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_z3rr5ch7nwkg" style="text-align: right" title="Operating lease cost">10</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Operating lease cost</td><td style="padding-bottom: 2.5pt"> </td> <td style="text-align: left; padding-bottom: 2.5pt">Selling and marketing</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_981_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zKclS3lJPD8d" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">12</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_989_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zP32b88jIBSf" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">14</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Total lease cost</td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20230101__20230331_zAFTTtVeNJXk" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">393</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_980_eus-gaap--OperatingLeaseCost_pn3n3_c20220101__20220331_zn73SNKW6gKb" style="border-bottom: Black 2.5pt double; text-align: right" title="Operating lease cost">215</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

347000

172000

22000

19000

12000

10000

12000

14000

393000

215000

40000000 15000000 250000000 35000000 12500000 22.50 12500000 32.50 32.50

NOTE 6 - DEBT Financing Trust Indenture On November 24, 2021, the Company entered into agreements to issue $45,000 in fixed rate senior notes (Series 2021 6 Notes) pursuant to a Trust Indenture held by UMB Bank, as trustee and disbursing agent, and Newlight Capital, LLC as servicer. The trust and debt documents also require a Lender Collateral Residual Value Insurance Policy (the “Insurance Policy”, with UMB Bank as named insured for $45,000), and a placement agent, which is Tribe Capital Markets, LLC. In connection with the merger on October 7, 2022 (the “Closing Date”), the Company entered into a Term Loan, Guarantee and Security Agreement (see “Term Loan Agreement” below) and the outstanding principal balance for the Series 2021-6 Notes underlying the Trust Indenture was paid in full. A loss on extinguishment of $4,824 was recognized upon settlement. During the three months ended March 31, 2022, a total of $619 of interest expense was incurred under the debt. Amortization of the debt issuance costs amounted to $613 during the three months ended March 31, 2022. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 6 - DEBT (CONTINUED) Term Loan Agreement On October 7, 2022, in connection with the merger, CNTQ, Legacy Dragonfly and CCM Investments 5 LLC, an affiliate of CCM LLC (“CCM 5”, and in connection with the Term Loan, the “Chardan Lender”), and EICF Agent LLC (“EIP” and, collectively with the Chardan Lender, the “Initial Term Loan Lenders”) entered into the Term Loan Agreement setting forth the terms of the Term Loan. The Chardan Lender backstopped its commitment under the Debt Commitment Letter by entering into a backstop commitment letter, dated as of May 20, 2022 (the “Backstop Commitment Letter”), with a certain third party financing source (the “Backstop Lender” and collectively with EIP, the “Term Loan Lenders”), pursuant to which the Backstop Lender committed to purchase from the Chardan Lender the aggregate amount of the Term Loan held by the Chardan Lender (the “Backstopped Loans”) immediately following the issuance of the Term Loan on the Closing Date. Pursuant to an assignment agreement, the Backstopped Loans were assigned by CCM 5 to the Backstop Lender on the Closing Date. Pursuant to the terms of the Term Loan Agreement, the Term Loan was advanced in one tranche on the Closing Date. The proceeds of the Term Loan were used (i) to refinance on the Closing Date prior indebtedness (including the obligations underlying the Trust Indenture), (ii) to support the Transaction under the merger Agreement, (iii) for working capital purposes and other corporate purposes, and (iv) to pay any fees associated with transactions contemplated under the Term Loan Agreement and the other loan documents entered into in connection therewith, including the transactions described in the foregoing clauses (i) and (ii) and fees and expenses related to the merger. The Term Loan amortizes in the amount of <span id="xdx_902_ecustom--DebtInstrumentAmortizationPercentage_pid_dp_uPure_c20221007__20221007__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zlo32LdbW3D6" title="Debt instrument, amortization percentage">5% per annum (or $<span id="xdx_908_ecustom--DebtInstrumentAmortizationAmount_pp1n3_c20221007__20221007__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zNiyUlNf5NT6" title="Debt instrument, amortization amount">937.5 on the first day of each calendar quarter) beginning <span id="xdx_904_ecustom--DebtInstrumentAmortizationPeriod_dtM_c20221007__20221007__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zf3yl0FTX4c4" title="Debt instrument, amortization period">24 months after the Closing Date and matures on the fourth anniversary of the Closing Date (“Maturity Date”). The Term Loan accrues interest (i) until April 1, 2023, at a per annum rate equal to the adjusted Secured Overnight Financing Rate (“SOFR”) plus a margin equal to <span id="xdx_906_eus-gaap--DebtInstrumentBasisSpreadOnVariableRate1_pid_dp_c20221007__20221007__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zx4AwvxTQmX5" title="Debt instrument, basis spread on variable rate">13.5%, of which <span id="xdx_900_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInCash_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--UntilApril12023Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember_zhg8QCFAGOH" title="Variable rate, payable in cash">7% will be payable in cash and <span id="xdx_908_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInKind_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--UntilApril12023Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember_zmAWMXOkKge5" title="Variable rate, payable In kind">6.5% will be paid in kind, (ii) thereafter until October 1, 2024, at a per annum rate equal to adjusted SOFR plus <span id="xdx_906_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInCash_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember_z6VNPJL5Ny5l" title="Variable rate, payable in kind">7% payable in cash plus an amount ranging from <span id="xdx_906_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInKind_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember__srt--RangeAxis__srt--MinimumMember_zsbJ4clVqwK8" title="Variable rate, payable in kind">4.5% to <span id="xdx_900_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInKind_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember__srt--RangeAxis__srt--MaximumMember_zzKL9fBf03Qc" title="Variable rate, payable in kind">6.5%, depending on the senior leverage ratio of the consolidated company, which will be paid in kind and (iii) at all times thereafter, at a per annum rate equal to adjusted SOFR plus a margin ranging from <span id="xdx_90F_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInCash_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember__srt--RangeAxis__srt--MinimumMember_zLK6vsteUVF" title="Variable rate, payable in cash">11.5% to <span id="xdx_90F_ecustom--DebtInstrumentBasisSpreadOnVariableRatePayableInCash_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember__srt--RangeAxis__srt--MaximumMember_zivSQFO1Djmj" title="Variable rate, payable in cash">13.5% payable in cash, depending on the senior leverage ratio of the consolidated company. In each of the foregoing cases, adjusted SOFR will be no less than <span id="xdx_900_eus-gaap--DebtInstrumentBasisSpreadOnVariableRate1_pid_dp_c20221007__20221007__srt--StatementScenarioAxis__custom--AfterApril12023UntilOctober12024Member__us-gaap--CreditFacilityAxis__custom--SeniorSecuredTermLoanFacilityMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember__us-gaap--VariableRateAxis__custom--AdjustedSecuredOvernightFinancingRateMember__srt--RangeAxis__srt--MinimumMember_z1lFLiRW0cY3" title="Basis spread on variable rate">1%. In addition to optional prepayments by the Company upon written notice, the Term Loan Agreement provides for mandatory prepayments upon receipt of proceeds from certain transactions or casualty events. Beginning on the date the financial statements for the year ended December 31, 2023 are required to be delivered to the Term Loan Lenders, the Company will be required to prepay the Term Loan based on excess cash flow, as defined in the agreement. Unless the obligations under the Term Loan are accelerated under the terms of the agreement, the maturity date will be October 7, 2026. The Term Loan Lenders have been granted a first priority lien, and security interest in, the mortgaged properties underlying the Company’s mortgages. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 6 - DEBT (CONTINUED) Term Loan Agreement (Continued) During the three months ended March 31, 2023, a total of $<span id="xdx_907_eus-gaap--InterestExpenseDebtExcludingAmortization_pn3n3_c20230101__20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zVcLohmuPq79" title="Interest expense">3,496 of interest expense was incurred under the debt. Amortization of the debt issuance costs amounted to $<span id="xdx_908_eus-gaap--AmortizationOfFinancingCosts_pn3n3_c20230101__20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zi8RpXObgbqf">219 during the three months ended March 31, 2023. The carrying balance of $<span id="xdx_903_eus-gaap--LongTermDebt_iI_pn3n3_c20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_z93AbvAXNlM8" title="Long term debt">20,699 on March 31, 2023 consisted of $<span id="xdx_90F_eus-gaap--DebtInstrumentFaceAmount_iI_pn3n3_c20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_z1NVBFhEWZK7" title="Debt instrument, face amount">75,000 in principal, plus $<span id="xdx_90B_eus-gaap--PaidInKindInterest_pn3n3_c20230101__20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_z0GEL7escU09" title="Paid in kind interest">2,430 PIK interest, less $<span id="xdx_90B_eus-gaap--DeferredFinanceCostsNet_iI_pn3n3_c20230331__us-gaap--LongtermDebtTypeAxis__us-gaap--SeniorNotesMember__us-gaap--TypeOfArrangementAxis__custom--TermLoanAgreementMember_zCGGFJaSuCXk">56,731 in unamortized debt discount related to the debt issuance costs. Financial Covenants Maximum Senior Leverage Ratio The Senior Leverage Ratio is the ratio of (a) consolidated indebtedness, as defined, on such date minus 100% of the unrestricted cash and cash equivalents held (subject to adjustment) to (b) Consolidated earnings before interest, tax and amortization (“EBITDA”) for the trailing twelve (12) fiscal month period most recently ended. If liquidity, as defined, for any fiscal quarter is less than $17,500, the Senior Leverage Ratio shall not be permitted, as of the last day of any fiscal quarter ending during any period set forth below, to exceed the ratio set forth opposite such period in the table below: SCHEDULE OF LEVERAGE RATION <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%; margin-left: 0.5in"> <tr style="vertical-align: bottom; background-color: White"> <td style="border-bottom: Black 1.5pt solid; width: 72%; font-weight: bold">Test Period Ending</td><td style="padding-bottom: 1.5pt; width: 2%; font-weight: bold"> </td> <td style="padding-bottom: 1.5pt; width: 1%; font-weight: bold; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; width: 24%; font-weight: bold; text-align: right">Leverage Ratio</td><td style="padding-bottom: 1.5pt; width: 1%; font-weight: bold; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2022 - March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90D_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyTwoToMarchThirtyOneTwoThousandTwentyThreeMember_za666F2jpCac" title="Leverage ratio">6.75 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2023 - September 30, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90B_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyThreeToSeptemberThirtyTwoThousandTwentyThreeMember_z6CJHYG8Dc1j" title="Leverage ration">6.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2023 - March 31, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_907_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyThreeToMarchThirtyOneTwoThousandTwentyThreeMember_zHXGY15SwE9d" title="Leverage ration">5.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2024 - September 30, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_906_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyFourToSeptemberThirtyTwoThousandTwentyFourMember_zJNCpogi7D7g" title="Leverage ratio">4.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2024 - March 31, 2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_904_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyFourToMarchThirtyOneTwoThousandTwentyFiveMember_zPJp7XD6scR6" title="Leverage ratio">3.25 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2025 and thereafter</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_908_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyFiveAndThereAfterMember_zXeeQUzaXBv8" title="Leverage ratio">3.00 to 1.00</td><td style="text-align: left"> </td></tr> </table> Liquidity The Company shall not permit their Liquidity (determined on a consolidated basis) to be less than $10,000 as of the last day of each fiscal month (commencing with month ending December 31, 2022). Fixed Charge Coverage Ratio The Fixed Charge Coverage Ratio is the ratio of consolidated EBITDA (less capital expenditures and certain other adjustments) to consolidated fixed charges, as defined in the agreement. If Liquidity is less than $15,000 as of the last day of any fiscal quarter (commencing with the quarter ending December 31, 2022), then the Company shall not permit the Fixed Charge Coverage Ratio for the trailing four quarterly periods ending on the last day of any such quarter to be less than 1.15 to 1.00. Capital Expenditures If consolidated EBITDA for the trailing twelve month period ending on the most recently completed fiscal quarter is less than $15,000, then the level of capital expenditures is limited. On March 29, 2023, the Company obtained a waiver from Alter Domus (US) LLC, as administrative agent for the lenders (the “Administrative Agent”) and the Term Loan Lenders of its failures to satisfy the fixed charge coverage ratio and maximum senior leverage ratio with respect to the minimum cash requirements under the Term Loan during the quarter ended March 31, 2023. As a result of the uncertainty of maintaining compliance with financial covenants the Company has continued to classify the entire term loan balance within current liabilities on the balance sheet. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 6 - DEBT (CONTINUED) Debt Maturities At March 31, 2023, the future debt maturities, based on contractual principal payments are as follows: SCHEDULE OF FUTURE DEBT MATURITIES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="display: none; vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left"> </td><td> </td> <td colspan="2" id="xdx_49A_20230331_zLhuXyVYbPIl"> </td><td> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">For Year Ended December 31,</td><td> </td> <td colspan="2"> </td><td> </td></tr> <tr id="xdx_408_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInNextTwelveMonths_iI_pn3n3_maLTDMRzRKL_znbXmNA0fSX" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2023 (1)</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearTwo_iI_pn3n3_maLTDMRzRKL_zxwtrGouY2J3" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">2024</td><td style="width: 10%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">938</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearThree_iI_pn3n3_maLTDMRzRKL_zhcHID5BXRyl" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3,750</td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearFour_iI_pn3n3_maLTDMRzRKL_z4GnH4O6SP7f" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">2026</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">91,775</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_408_ecustom--LongTermDebtMaturitiesRepaymentsOfPrincipal_iTI_pn3n3_mtLTDMRzRKL_maLTDzvhW_zy9KvlNFUVkl" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">96,463</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_402_ecustom--EstimatedInterestPaidinkind_iI_pn3n3_maLTDzvhW_zhsYaXylo2p9" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Estimated interest paid-in-kind</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(19,033</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_401_eus-gaap--LongTermDebt_iTI_pn3n3_mtLTDzvhW_zqZlkG2DdnK5" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total debt</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">77,430</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--DeferredFinanceCostsNet_iNI_pn3n3_di_zz1HQEbB5HO7" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Unamortized debt issuance costs, noncurrent</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(56,731</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_40F_eus-gaap--DebtInstrumentCarryingAmount_iI_pn3n3_zK8dZnCeHsQa" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total carrying amount</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">20,699</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--LongTermDebtCurrent_iNI_pn3n3_di_zCv4Os8N8cfc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Current portion of debt</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(20,699</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_401_eus-gaap--LongTermDebtNoncurrent_iI_pn3n3_zgfWyEE6dYbd" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total long-term debt</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0; margin-bottom: 0"><tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in"/><td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Represents scheduled payments for the remaining nine-month period ending December 31, 2023</td></tr></table>

45000000

4824000

619000

613000

0.05 937500 P24M

0.135

0.07 0.065 0.07 0.045 0.065 0.115 0.135

0.01

3496000

219000

20699000

75000000

2430000

56731000

The Senior Leverage Ratio is the ratio of (a) consolidated indebtedness, as defined, on such date minus 100% of the unrestricted cash and cash equivalents held (subject to adjustment) to (b) Consolidated earnings before interest, tax and amortization (“EBITDA”) for the trailing twelve (12) fiscal month period most recently ended. If liquidity, as defined, for any fiscal quarter is less than $17,500, the Senior Leverage Ratio shall not be permitted

SCHEDULE OF LEVERAGE RATION <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%; margin-left: 0.5in"> <tr style="vertical-align: bottom; background-color: White"> <td style="border-bottom: Black 1.5pt solid; width: 72%; font-weight: bold">Test Period Ending</td><td style="padding-bottom: 1.5pt; width: 2%; font-weight: bold"> </td> <td style="padding-bottom: 1.5pt; width: 1%; font-weight: bold; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; width: 24%; font-weight: bold; text-align: right">Leverage Ratio</td><td style="padding-bottom: 1.5pt; width: 1%; font-weight: bold; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2022 - March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90D_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyTwoToMarchThirtyOneTwoThousandTwentyThreeMember_za666F2jpCac" title="Leverage ratio">6.75 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2023 - September 30, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90B_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyThreeToSeptemberThirtyTwoThousandTwentyThreeMember_z6CJHYG8Dc1j" title="Leverage ration">6.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2023 - March 31, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_907_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyThreeToMarchThirtyOneTwoThousandTwentyThreeMember_zHXGY15SwE9d" title="Leverage ration">5.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2024 - September 30, 2024</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_906_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyFourToSeptemberThirtyTwoThousandTwentyFourMember_zJNCpogi7D7g" title="Leverage ratio">4.00 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>December 31, 2024 - March 31, 2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_904_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--DecemberThirtyOneTwoThousandTwentyFourToMarchThirtyOneTwoThousandTwentyFiveMember_zPJp7XD6scR6" title="Leverage ratio">3.25 to 1.00</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>June 30, 2025 and thereafter</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_908_eus-gaap--DebtInstrumentDescriptionOfVariableRateBasis_pid_c20230101__20230331__us-gaap--CreditFacilityAxis__custom--JuneThirtyTwoThousandTwentyFiveAndThereAfterMember_zXeeQUzaXBv8" title="Leverage ratio">3.00 to 1.00</td><td style="text-align: left"> </td></tr> </table>

6.75 to 1.00

6.00 to 1.00

5.00 to 1.00

4.00 to 1.00

3.25 to 1.00

3.00 to 1.00

The Company shall not permit their Liquidity (determined on a consolidated basis) to be less than $10,000 as of the last day of each fiscal month (commencing with month ending December 31, 2022) The Fixed Charge Coverage Ratio is the ratio of consolidated EBITDA (less capital expenditures and certain other adjustments) to consolidated fixed charges, as defined in the agreement. If Liquidity is less than $15,000 as of the last day of any fiscal quarter (commencing with the quarter ending December 31, 2022), then the Company shall not permit the Fixed Charge Coverage Ratio for the trailing four quarterly periods ending on the last day of any such quarter to be less than 1.15 to 1.00 If consolidated EBITDA for the trailing twelve month period ending on the most recently completed fiscal quarter is less than $15,000, then the level of capital expenditures is limited

At March 31, 2023, the future debt maturities, based on contractual principal payments are as follows: SCHEDULE OF FUTURE DEBT MATURITIES <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 70%; margin-right: auto"> <tr style="display: none; vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left"> </td><td> </td> <td colspan="2" id="xdx_49A_20230331_zLhuXyVYbPIl"> </td><td> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">For Year Ended December 31,</td><td> </td> <td colspan="2"> </td><td> </td></tr> <tr id="xdx_408_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInNextTwelveMonths_iI_pn3n3_maLTDMRzRKL_znbXmNA0fSX" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2023 (1)</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearTwo_iI_pn3n3_maLTDMRzRKL_zxwtrGouY2J3" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 70%; text-align: left">2024</td><td style="width: 10%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">938</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearThree_iI_pn3n3_maLTDMRzRKL_zhcHID5BXRyl" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">2025</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">3,750</td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--LongTermDebtMaturitiesRepaymentsOfPrincipalInYearFour_iI_pn3n3_maLTDMRzRKL_z4GnH4O6SP7f" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">2026</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">91,775</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_408_ecustom--LongTermDebtMaturitiesRepaymentsOfPrincipal_iTI_pn3n3_mtLTDMRzRKL_maLTDzvhW_zy9KvlNFUVkl" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">96,463</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_402_ecustom--EstimatedInterestPaidinkind_iI_pn3n3_maLTDzvhW_zhsYaXylo2p9" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Estimated interest paid-in-kind</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(19,033</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_401_eus-gaap--LongTermDebt_iTI_pn3n3_mtLTDzvhW_zqZlkG2DdnK5" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 2.5pt">Total debt</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">77,430</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--DeferredFinanceCostsNet_iNI_pn3n3_di_zz1HQEbB5HO7" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Unamortized debt issuance costs, noncurrent</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(56,731</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_40F_eus-gaap--DebtInstrumentCarryingAmount_iI_pn3n3_zK8dZnCeHsQa" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total carrying amount</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">20,699</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_407_eus-gaap--LongTermDebtCurrent_iNI_pn3n3_di_zCv4Os8N8cfc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 2.5pt">Less: Current portion of debt</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">(20,699</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_401_eus-gaap--LongTermDebtNoncurrent_iI_pn3n3_zgfWyEE6dYbd" style="vertical-align: bottom; background-color: White"> <td style="text-align: left; padding-bottom: 1.5pt">Total long-term debt</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left">$</td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; margin-top: 0; margin-bottom: 0"><tr style="font: 10pt Times New Roman, Times, Serif; vertical-align: top"> <td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in"/><td style="font: 10pt Times New Roman, Times, Serif; width: 0.25in">(1)</td><td style="font: 10pt Times New Roman, Times, Serif">Represents scheduled payments for the remaining nine-month period ending December 31, 2023</td></tr></table>

938000

3750000

91775000

96463000 -19033000

77430000

56731000

20699000

NOTE 7 - ASSET PURCHASE AGREEMENT Bourns Production, Inc On January 1, 2022, the Company entered into an asset purchase agreement (the “APA”) with Bourns Productions, Inc., a Nevada corporation (“Bourns Productions”) pursuant to which the Company acquired machinery, equipment and a lease for a podcast studio from Bourns Productions as set forth in the APA for a purchase price of $<span id="xdx_905_eus-gaap--AssetAcquisitionConsiderationTransferred_pn3n3_c20220101__20220101__us-gaap--AssetAcquisitionAxis__custom--BournsProductionIncMember_zsi2cVHsHQgj" title="Purchase price for acquiring machinery and equipment">197 which approximated fair market value. Thomason Jones Company, LLC In April 2022, the Company entered into an Asset Purchase Agreement (the “April 2022 Asset Purchase Agreement”) with William Thomason, Richard Jones, and Thomason Jones Company, LLC (“Thomason Jones”) whereby the Company acquired inventory and intellectual property assets for up to $<span id="xdx_908_eus-gaap--AssetAcquisitionConsiderationTransferred_pn3n3_c20220401__20220430__us-gaap--AssetAcquisitionAxis__custom--ThomasonJonesCompanyLLCMember__srt--RangeAxis__srt--MaximumMember_zqayExe7ICIh" title="Purchase price for acquiring machinery and equipment">700 cash plus contingent payments of $<span id="xdx_905_eus-gaap--AssetAcquisitionConsiderationTransferredContingentConsideration_pn3n3_c20220401__20220430__us-gaap--AssetAcquisitionAxis__custom--ThomasonJonesCompanyLLCMember_zdrK8C5bjID8" title="Contingent payments">1,000 each to William Thomason and Richard Jones (the “Earn Out”). The Company determined the contingent consideration to be recognized as contingent compensation to Mr. Thomason and Mr. Jones. The Company concluded the purchase price to be $<span id="xdx_901_eus-gaap--AssetAcquisitionConsiderationTransferred_pn3n3_c20230101__20230331__us-gaap--AssetAcquisitionAxis__custom--ThomasonJonesCompanyLLCMember_zscaUHeOrd4a" title="Purchase price for acquiring machinery and equipment">444 and was allocated in its entirety to inventory. Contingent Compensation If, within twenty-four months of the Agreement the Company realizes $3,000 in gross sales of product either (a) sold under the Wakespeed brand and/or (b) which incorporates any portion of Purchased IP as listed within the agreement, then the Company will pay to Thomason and Jones each the amount of $<span id="xdx_907_eus-gaap--OtherLiabilities_iI_pn3n3_c20230331__us-gaap--AssetAcquisitionAxis__custom--ThomasonJonesCompanyLLCMember__us-gaap--RelatedAndNonrelatedPartyStatusAxis__us-gaap--RelatedPartyMember_zW8pUZHdoW8h" title="Repayment to related party">1,000 as soon as reasonably practicable. This payment may be made in cash or common stock, in the sole discretion of the Company. As a result, the Company determined that a liability should be recorded ratably over the 24 month period. The Company recognized immediate compensation expense within sales and marketing of $417 on October 1, 2022 for amounts that should have been accrued for during the period April 2022 through September 2022. In October 2022, the Company determined the sales goals will most likely be achieved within 18 months. As a result, the Company changed its estimate prospectively and accelerated the accrual as if the sales goals would be achieved within an 18 month period from the date of acquisition. As a result, the Company recorded an accrual related to the Earn Out in the amount of $1,147 and $782 as of March 31, 2023 and December 31, 2022. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data)

197000

700000

1000000

444000

3000000

1000000

417000

1147000

782000

NOTE 8 - RELATED PARTY The Company loaned its Chief Financial Officer $<span id="xdx_902_eus-gaap--RelatedPartyTransactionAmountsOfTransaction_pn3n3_c20230101__20230331__us-gaap--RelatedPartyTransactionAxis__custom--PromissoryNoteWithRelatedPartyMember__us-gaap--RelatedPartyTransactionsByRelatedPartyAxis__srt--ChiefFinancialOfficerMember_zxYIpNfPjpM7" title="Repayment amount owned">469 to repay amounts owed by him to his former employer and entered into a related Promissory Note with a maturity date of March 1, 2026. The loan was forgiven in full in March of 2022 and was recorded within general and administrative expense. On October 25, 2022, the Company entered into a separation and release of claims agreement with its Chief Operating Officer (“COO”). As consideration for the COO’s execution of the agreement, the Company agreed to pay the employee a lump sum payment of $<span id="xdx_90F_eus-gaap--RelatedPartyTransactionAmountsOfTransaction_pn3n3_c20230101__20230331__us-gaap--RelatedPartyTransactionsByRelatedPartyAxis__srt--ChiefOperatingOfficerMember_zJxN7p9k8rq" title="Repayment to officer">100 which is included in general and administrative expenses in the statements of operations, payments equivalent to $1,000 divided into 24 monthly payments commencing on December 1, 2022, and all outstanding equity-based compensation awards to become fully vested and exercisable. The COO shall have 12 months from the termination date to exercise outstanding options. In February 2023, the Company entered into an agreement with its former COO in which the ownership of a Company van was transferred to the former COO in connection with his severance. The Company accounted for the cost of the van as an employee bonus, resulting in $116 of general and administrative expense for the current period. On March 5, 2023, the Company entered into a convertible promissory note (the “Note”) with a board member in the amount of $1,000, or the Principal Amount. Upon execution of the Note and funding of the original principal sum, a payment of $100 ( the “Loan Fee”) was fully earned as of the date of the Note and was due and payable in full in cash on April 4, 2023. The Company paid the Principal Amount and the Loan Fee on April 1, 2023 and April 4, 2023, respectively.

469000

100000

1000000

100000

NOTE 9 - WARRANTS Common Stock Warrants classified as Equity Public Warrants Each Public Warrant entitles the holder to the right to purchase one share of common stock at an exercise price of $11.50 per share. No fractional shares will be issued upon exercise of the Public Warrants. The Company may elect to redeem the Public Warrants subject to certain conditions, in whole and not in part, at a price of $<span id="xdx_900_eus-gaap--ClassOfWarrantOrRightExercisePriceOfWarrantsOrRights1_iI_pid_c20230331__us-gaap--ClassOfWarrantOrRightAxis__custom--PublicWarrantsMember_zLtDTnNGsErl" title="Exercise price of warrants">0.01 per Public Warrant if (i) 30 days’ prior written notice of redemption is provided to the holders, and (ii) the last reported sale price of the Company’s common stock equals or exceeds $16.00 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 business day prior to the date on which the Company sends the notice of redemption to the warrant holders. Upon issuance of a redemption notice by the Company, the warrant holders have a period of 30 days to exercise for cash, or on a cashless basis. On the Closing Date, there were 9,487,500 Public Warrants issued and outstanding. The Public Warrants are not precluded from equity classification and are accounted for as such on the date of issuance, and each balance sheet date thereafter. The measurements of the Public Warrants after the detachment of the Public Warrants from the Units are classified as Level 1 due to the use of an observable market quote in an active market under the ticker DFLIW. For periods subsequent to the detachment of the Public Warrants from the Units, the close price of the Public Warrant price was used as the fair value of the Warrants as of each relevant date. During the quarter ended March 31, 2023, the Company received proceeds from public warrant exercises of $747 in exchange for 64,971 common shares. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 9 - WARRANTS (CONTINUED) Common Stock Warrants classified as Liability Private Placement Warrants The Private Placement Warrants may not be redeemed by the Company so long as the Private Placement Warrants are held by the initial purchasers, or such purchasers’ permitted transferees. The Private Warrants: (i) will be exercisable either for cash or on a cashless basis at the holders option and (ii) will not be redeemable by the Company, in either case as long as the Private Warrants are held by the initial purchasers or any of their permitted transferees (as prescribed in the Subscription Agreement). The Private Warrants may not be sold, transferred, assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of, the Private Warrants (or any securities underlying the Private Warrants) for a period of one hundred eighty (180) days following the effective date of the Registration Statement to anyone other than any member participating in the Public Offering and the officers or partners thereof, if all securities so transferred remain subject to the lock-up restriction for the remainder of the time period. During the three months ended March 31, 2023, private placement warrant holders exercised 3,126,472 warrants on a cashless basis, with the Company agreeing to issue 1,100,000 shares of common stock in connection with such exercise. There were 1,501,386 and 4,627,858 private warrants issued and outstanding as of March 31, 2023 and December 31, 2022, respectively. The Company accounts for the Private Warrants issued in connection with the Initial Public Offering in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the private warrants do not meet the criteria for equity treatment thereunder, each private warrant must be recorded as a liability. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement, the warrant liabilities will be adjusted to its current fair value, with the change in fair value recognized in the Company’s statement of operations. The Company will reassess the classification at each balance sheet date. The Private Placement Warrants are classified as Level 2 as the transfer of private placement warrants to anyone who is not a permitted transferee would result in the Private Placement Warrants having substantially similar terms as the Public Warrants (with the exception of a different remaining life). We determined, through use of a Binomial Lattice model, that the fair value of each Private Placement Warrant less a discount for the difference in remaining life is equivalent to that of each Public Warrant. Term Loan Warrants In connection with the entry into the Term Loan Agreement, and as a required term and condition thereof, the Company issued (i) the penny warrants to the Term Loan Lenders exercisable to purchase an aggregate of <span id="xdx_906_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_iI_pid_c20230331__us-gaap--ClassOfWarrantOrRightAxis__custom--PennyWarrantsMember_zadVgTVPN3El" title="Warrants to purchase shares">2,593,056 shares (the “Penny Warrants”) and (ii) the $10 warrants to issue warrants to the Term Loan Lenders exercisable to purchase an aggregate of <span id="xdx_901_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_iI_pid_c20230331__us-gaap--ClassOfWarrantOrRightAxis__custom--Warrants10Member_zTWpavIHV696" title="Aggregate purchase of common stock">1,600,000 shares of common stock at $10 per share (the “$10 Warrants” and, together with the Penny Warrants, the “Term Loan Warrants”). The $10 Warrants were exercised on a cashless basis on October 10, 2022, with the Company issuing <span id="xdx_90D_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_iI_pid_c20221010__us-gaap--ClassOfWarrantOrRightAxis__custom--Warrants10Member_z81qDeJuJ4W" title="Shares of common stock">457,142 shares of Common Stock in connection with such exercise. During the three months ended March 31, 2023, penny warrant holders exercised <span id="xdx_90C_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_iI_pid_c20230331__us-gaap--ClassOfWarrantOrRightAxis__custom--PennyWarrantsMember__us-gaap--StatementEquityComponentsAxis__us-gaap--CommonStockMember_zhU48plSKfLg" title="Warrants to purchase shares">1,250,000 warrants on a cashless basis, with the Company agreeing to issue <span id="xdx_904_eus-gaap--ClassOfWarrantOrRightNumberOfSecuritiesCalledByWarrantsOrRights_iI_pid_c20221231__us-gaap--ClassOfWarrantOrRightAxis__custom--Warrants10Member__us-gaap--StatementEquityComponentsAxis__us-gaap--CommonStockMember_zVqphjm0Mm9b" title="Warrants to purchase shares">1,248,294 shares of common stock in connection with such exercise. The Company concluded the warrants are not considered indexed to the Company’s stock and to be accounted for as liabilities under ASC 815. As such, the estimated fair value is recognized as a liability each reporting period, with changes in the fair value recognized within income each period. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 9 - WARRANTS (CONTINUED) Common Stock Warrants classified as Liability (Continued) The following table provides the significant inputs to the Black-Scholes method for the fair value of the Penny Warrants: SCHEDULE FAIR VALUE WARRANTS <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">As of March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">As of December 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%">Common stock price</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_983_eus-gaap--SharePrice_iI_pid_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember_zhnYgR8PDT53" style="width: 20%; text-align: right" title="Common stock price">3.00</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_982_eus-gaap--SharePrice_iI_pid_c20221231_zjLoEaSztdE8" style="width: 20%; text-align: right" title="Common stock price">11.09</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Exercise price</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98C_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uUSDPShares_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputSharePriceMember_zoqbE6arNBFg" style="text-align: right" title="Common stock price">0.01</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uUSDPShares_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputSharePriceMember_zuAQ1zenP5W2" style="text-align: right" title="Common stock price">0.01</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Dividend yield</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_909_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember_z1KkKrjoIBb1" title="Common stock price">0</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90E_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember_zFYT8f32aII4" title="Common stock price">0</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Term</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90E_eus-gaap--WarrantsAndRightsOutstandingTerm_iI_dtY_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedTermMember_zbEdzxTtCGth" title="Term">9.52</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">9.77</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Volatility</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember_z6OPlQQI0iWe" style="text-align: right" title="Common stock price">89.00</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td id="xdx_983_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember_zXn8bJJvZRY3" style="text-align: right" title="Common stock price">90.00</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Risk-free rate</td><td> </td> <td style="text-align: left"> </td><td id="xdx_987_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_zurVR3Vd04Wd" style="text-align: right" title="Common stock price">3.43</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_z57P8STaK6Ee" style="text-align: right" title="Common stock price">3.90</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Fair value</td><td> </td> <td style="text-align: left">$</td><td id="xdx_98C_ecustom--FairValueOfWarrant_iI_pid_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember_zcUn7qOJuSff" style="text-align: right" title="Common stock price">2.99</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98F_ecustom--FairValueOfWarrant_iI_pid_c20221231_z5aQl5iQ87zf" style="text-align: right" title="Common stock price">11.89</td><td style="text-align: left"> </td></tr> </table> The following table presents a roll-forward of the Company’s warrants from January 1, 2023 to March 31, 2023: SCHEDULE OF ROLL FORWARD IN WARRANTS Private Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_496_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--PrivateWarrantsMember_zGgrDPH94RQl" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zGGua8A4KWqb" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">4,627,858</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zSQAqvKP2fw1" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(3,126,472</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zExLgoPbr5Fe" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">1,501,386</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no private warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. Public Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_490_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--PublicWarrantsMember_zm5n610YO70c" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zSvtA0bz73nb" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">9,487,500</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zsySIeFw0Hzc" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(64,971</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zTQiYsAt0jdh" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">9,422,529</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no public warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. Term Loan Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_492_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--TermLoanWarrantsMember_z0ZwzP7V1Sqa" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zbOt1BTejKUc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">2,593,056</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zDYmFPvjUC91" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,250,000</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zo2DMzcpnold" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">1,343,056</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no term loan warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. The following table presents a roll forward of the aggregate fair values of the Company’s warrant liabilities for which fair value is determined by Level 3 Inputs. The only class of warrants that were determined to be Level 3 are the term loan warrants. <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49F_20230101__20230331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zNk5tOClmVpj" style="border-bottom: Black 1.5pt solid; text-align: center">Warrant Liability</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_400_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iS_pn3n3_zgzQwxH2LFsf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%; text-align: justify">Balances, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40A_ecustom--ExerciseOfWarrants_iN_pn3n3_di_zV1PqTVcBAU9" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Exercise of warrants</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(8,822</td><td style="text-align: left">)</td></tr> <tr id="xdx_407_eus-gaap--FairValueAdjustmentOfWarrants_iN_pn3n3_di_zI2glXM5LQ66" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 1.5pt">Change in fair value of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(17,998</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_404_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iE_pn3n3_zifW7aHqazn5" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 2.5pt">Balances, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,021</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data)

11.50

0.01

16.00

9487500

747000 64971

3126472

1100000

1501386

4627858

2593056

1600000

457142

1250000

1248294

The following table provides the significant inputs to the Black-Scholes method for the fair value of the Penny Warrants: SCHEDULE FAIR VALUE WARRANTS <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">As of March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">As of December 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 52%">Common stock price</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_983_eus-gaap--SharePrice_iI_pid_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember_zhnYgR8PDT53" style="width: 20%; text-align: right" title="Common stock price">3.00</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_982_eus-gaap--SharePrice_iI_pid_c20221231_zjLoEaSztdE8" style="width: 20%; text-align: right" title="Common stock price">11.09</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Exercise price</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98C_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uUSDPShares_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputSharePriceMember_zoqbE6arNBFg" style="text-align: right" title="Common stock price">0.01</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uUSDPShares_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputSharePriceMember_zuAQ1zenP5W2" style="text-align: right" title="Common stock price">0.01</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Dividend yield</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_909_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember_z1KkKrjoIBb1" title="Common stock price">0</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90E_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedDividendRateMember_zFYT8f32aII4" title="Common stock price">0</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td>Term</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90E_eus-gaap--WarrantsAndRightsOutstandingTerm_iI_dtY_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputExpectedTermMember_zbEdzxTtCGth" title="Term">9.52</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">9.77</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Volatility</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember_z6OPlQQI0iWe" style="text-align: right" title="Common stock price">89.00</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td id="xdx_983_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputPriceVolatilityMember_zXn8bJJvZRY3" style="text-align: right" title="Common stock price">90.00</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Risk-free rate</td><td> </td> <td style="text-align: left"> </td><td id="xdx_987_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_zurVR3Vd04Wd" style="text-align: right" title="Common stock price">3.43</td><td style="text-align: left">%</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--WarrantsAndRightsOutstandingMeasurementInput_iI_pid_uPure_c20221231__us-gaap--MeasurementInputTypeAxis__us-gaap--MeasurementInputRiskFreeInterestRateMember_z57P8STaK6Ee" style="text-align: right" title="Common stock price">3.90</td><td style="text-align: left">%</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Fair value</td><td> </td> <td style="text-align: left">$</td><td id="xdx_98C_ecustom--FairValueOfWarrant_iI_pid_c20230331__srt--StatementScenarioAxis__custom--InitialMeasurementMember_zcUn7qOJuSff" style="text-align: right" title="Common stock price">2.99</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98F_ecustom--FairValueOfWarrant_iI_pid_c20221231_z5aQl5iQ87zf" style="text-align: right" title="Common stock price">11.89</td><td style="text-align: left"> </td></tr> </table>

3.00

11.09

0.01

P9Y6M7D

P9Y9M7D

89.00

90.00

3.43

3.90

2.99 11.89

The following table presents a roll-forward of the Company’s warrants from January 1, 2023 to March 31, 2023: SCHEDULE OF ROLL FORWARD IN WARRANTS Private Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_496_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--PrivateWarrantsMember_zGgrDPH94RQl" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zGGua8A4KWqb" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">4,627,858</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_409_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zSQAqvKP2fw1" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(3,126,472</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zExLgoPbr5Fe" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">1,501,386</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no private warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. Public Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_490_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--PublicWarrantsMember_zm5n610YO70c" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zSvtA0bz73nb" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">9,487,500</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zsySIeFw0Hzc" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(64,971</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zTQiYsAt0jdh" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">9,422,529</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no public warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. Term Loan Warrants: <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_492_20230101__20230331__us-gaap--StatementEquityComponentsAxis__custom--TermLoanWarrantsMember_z0ZwzP7V1Sqa" style="border-bottom: Black 1.5pt solid; text-align: center">Common Stock Warrants</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iS_pid_zbOt1BTejKUc" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%">Warrants Outstanding, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 20%; text-align: right">2,593,056</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsExercised_iN_pid_di_zDYmFPvjUC91" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Exercise of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(1,250,000</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_40A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNonOptionEquityInstrumentsOutstandingNumber_iE_pid_zo2DMzcpnold" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Warrants Outstanding, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">1,343,056</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> There were no term loan warrants issued, exercised and outstanding from the period January 1, 2022 through March 31, 2022. The following table presents a roll forward of the aggregate fair values of the Company’s warrant liabilities for which fair value is determined by Level 3 Inputs. The only class of warrants that were determined to be Level 3 are the term loan warrants. <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 65%; margin-left: 0.5in"> <tr style="vertical-align: bottom"> <td style="text-align: center"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49F_20230101__20230331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zNk5tOClmVpj" style="border-bottom: Black 1.5pt solid; text-align: center">Warrant Liability</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_400_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iS_pn3n3_zgzQwxH2LFsf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 76%; text-align: justify">Balances, January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td style="width: 20%; text-align: right">30,841</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40A_ecustom--ExerciseOfWarrants_iN_pn3n3_di_zV1PqTVcBAU9" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Exercise of warrants</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">(8,822</td><td style="text-align: left">)</td></tr> <tr id="xdx_407_eus-gaap--FairValueAdjustmentOfWarrants_iN_pn3n3_di_zI2glXM5LQ66" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 1.5pt">Change in fair value of warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">(17,998</td><td style="padding-bottom: 1.5pt; text-align: left">)</td></tr> <tr id="xdx_404_eus-gaap--SharesSubjectToMandatoryRedemptionSettlementTermsFairValueOfShares_iE_pn3n3_zifW7aHqazn5" style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 2.5pt">Balances, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">4,021</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

4627858

3126472

1501386

9487500

64971

9422529

2593056

1250000

1343056

30841000

8822000

17998000

4021000

NOTE 10 - COMMON STOCK The Company is authorized to issue up to 170,000,000 shares of common stock with $0.0001 par value. Common stockholders are entitled to dividends if and when declared by the Board of Directors subject to the rights of the preferred stockholders. For the three months ended March 31, 2023 and 2022, the Company had reserved shares of common stock for issuance as follows: SUMMARY OF RESERVED SHARES OF COMMON STOCK FOR ISSUANCE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 80%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_495_20230331_zoaQ6IzTuZCd" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49B_20220331_zRUL0DM0oX6e" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_pid_zpg5qO8DNBr8" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%; text-align: left">Options issued and outstanding</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">3,731,392</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">3,631,002</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40F_eus-gaap--CommonStockSharesOutstanding_iI_pid_zAQgfnSmWmKg" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Common stock outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,795,502</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,581,910</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--ClassOfWarrantOrRightOutstanding_iI_pid_zQ6oAI59ruf4" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Warrants outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">12,266,971</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_ecustom--EarnoutShares_iI_pid_zrzLvBJAuul8" style="vertical-align: bottom; background-color: White"> <td>Earnout shares</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">40,000,000</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAvailableForGrant_iI_pid_zbXkZdGcVNs6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Shares available for future issuance</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">4,319,309</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">1,205,790</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CommonStockCapitalSharesReservedForFutureIssuance_iTI_pid_zbuuojuKRZx3" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">106,113,174</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">41,418,702</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table> ChEF Equity Facility The Company and Chardan Capital Markets LLC, a New York limited liability company (“CCM LLC”) entered into a purchase agreement (the “Purchase Agreement”) and a Registration Rights Agreement (the “ChEF RRA”) in connection with the merger. Pursuant to the Purchase Agreement, the Company has the right to sell to CCM LLC an amount of shares of Common Stock, up to a maximum aggregate purchase price of $<span id="xdx_909_ecustom--PlanOfMergerMaximumAggregatePurchasePrice_pn6n6_c20230101__20230331__us-gaap--TypeOfArrangementAxis__custom--PurchaseAgreementMember__srt--RangeAxis__srt--MaximumMember_zVANeqxrpYVg" title="Aggregated purchase price">150 million, pursuant to the terms of the Purchase Agreement. In addition, the Company appointed LifeSci Capital, LLC as “qualified independent underwriter” with respect to the transactions contemplated by the Purchase Agreement. Under the terms of the Purchase Agreement, the Company issued 73,500 shares pursuant to the Purchase Agreement with CCM LLC for aggregate net proceeds to the Company of $597 from the period January 1, 2023 through March 31, 2023.

170000000

0.0001

For the three months ended March 31, 2023 and 2022, the Company had reserved shares of common stock for issuance as follows: SUMMARY OF RESERVED SHARES OF COMMON STOCK FOR ISSUANCE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 80%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_495_20230331_zoaQ6IzTuZCd" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_49B_20220331_zRUL0DM0oX6e" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iI_pid_zpg5qO8DNBr8" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%; text-align: left">Options issued and outstanding</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">3,731,392</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 18%; text-align: right">3,631,002</td><td style="width: 1%; text-align: left"> </td></tr> <tr id="xdx_40F_eus-gaap--CommonStockSharesOutstanding_iI_pid_zAQgfnSmWmKg" style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Common stock outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,795,502</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,581,910</td><td style="text-align: left"> </td></tr> <tr id="xdx_406_eus-gaap--ClassOfWarrantOrRightOutstanding_iI_pid_zQ6oAI59ruf4" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Warrants outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">12,266,971</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_403_ecustom--EarnoutShares_iI_pid_zrzLvBJAuul8" style="vertical-align: bottom; background-color: White"> <td>Earnout shares</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">40,000,000</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">-</td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAvailableForGrant_iI_pid_zbXkZdGcVNs6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Shares available for future issuance</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">4,319,309</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">1,205,790</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_40E_eus-gaap--CommonStockCapitalSharesReservedForFutureIssuance_iTI_pid_zbuuojuKRZx3" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt">Total</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">106,113,174</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td style="border-bottom: Black 2.5pt double; text-align: right">41,418,702</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> </table>

3731392

3631002

45795502

36581910

12266971

40000000

4319309

1205790

106113174

41418702

150000000

73500

597000

NOTE 11 - STOCK-BASED COMPENSATION Share-based compensation expense for options and RSUs totaling $4,487 and $288 was recognized in the Company’s consolidated statements of operations for the three months ended March 31, 2023 and 2022, respectively. Of the $4,487 of share-based compensation incurred during the three months ended March 31, 2023, $36 is allocated to cost of goods sold, $<span id="xdx_90A_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_z6sjpHF7wzu6" title="Total compensation">29 to research and development, $<span id="xdx_901_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zjpKZBNw8I06" title="Total compensation">856 to selling and marketing, and $<span id="xdx_906_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20230101__20230331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_zW93oBf5Wdve" title="Total compensation">3,566 to general and administrative expenses. Of the $288 of share-based compensation incurred during the three months ended March 31, 2022, $97 is allocated to cost of goods sold, $<span id="xdx_90F_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--ResearchAndDevelopmentExpenseMember_zA10xqBjmYQ2" title="Total compensation">37 to research and development, $<span id="xdx_901_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--SellingAndMarketingExpenseMember_zLEMKNRk3TW4" title="Total compensation">60 to selling and marketing, and $<span id="xdx_90E_eus-gaap--AllocatedShareBasedCompensationExpense_pn3n3_c20220101__20220331__us-gaap--IncomeStatementLocationAxis__us-gaap--GeneralAndAdministrativeExpenseMember_zPQC6DF9zya9" title="Total compensation">94 to general and administrative expenses. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 11 - STOCK-BASED COMPENSATION (CONTINUED) A summary of the Company’s option activity and related information follows: SCHEDULE OF OPTION ACTIVITY AND RELATED INFORMATION <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Number of Options (1)</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Exercise Price</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Grant Date Fair Value</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; padding-bottom: 1.5pt; text-align: center">Weighted-Average Remaining Contractual Life (in years)</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Aggregate intrinsic value</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 35%; text-align: justify">Balances, January 1, 2022</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_pid_c20220101__20220331_fKDEp_zh4FJjfoV7J1" style="width: 9%; text-align: right" title="Number of Options, Balance at the beginning">3,690,955</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iS_pid_c20220101__20220331_zZIOsIjSlHz5" style="width: 9%; text-align: right" title="Weighted- Average Exercise Price - Balances at the beginning"> 1.98</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20220101__20220331_zbLl866Vllqc" style="width: 9%; text-align: right" title="Weighted- Average Grant Date Fair Value, Balances at the beginning"> 1.38</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 9%; text-align: right"> <span id="xdx_90E_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm_dtY_c20220101__20220331_zJYhOcbmZBD7" title="Weighted- Average Remaining Contractual Life (in years)">8.52</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iS_pn3n3_c20220101__20220331_zNLHjMduMut3" style="width: 9%; text-align: right" title="Aggregate Intrinsic value Balances at the beginning">6,550</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Options granted</td><td> </td> <td style="text-align: left"> </td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_pid_c20220101__20220331_fKDEp_zH9qaSbcVz95" style="text-align: right" title="Number of Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_z6kjRntpmkNl" style="text-align: right" title="Weighted- Average Exercise Price Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zuABifId3Pkh" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98C_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantedInPeriodIntrinsicValue_pn3n3_c20220101__20220331_zsL0LHg7Xskg" style="text-align: right" title="Aggregate Intrinsic value Options granted">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Options forfeited</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_iN_pid_di_c20220101__20220331_fKDEp_zw2BDk6NHqfh" style="text-align: right" title="Number of Options forfeited">(11,584</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsForfeituresInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_zxXHviSYJlRf" style="text-align: right" title="Weighted- Average Exercise Price Options forfeited">1.44</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedOptionsForfeitedWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zwFZHkpAr253" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options forfeited">2.17</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeitedInPeriodTotalIntrinsicValue_pn3n3_c20220101__20220331_zGfia9Vjo5a9" style="text-align: right" title="Aggregate Intrinsic value Options forfeited">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Options exercised</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--StockIssuedDuringPeriodSharesStockOptionsExercised_iN_pid_di_c20220101__20220331_fKDEp_zgjrJIDCWUJa" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of Options exercised">(48,369</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_zbumZMndBBGa" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Exercise Price Options exercised">0.49</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_986_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zZRiK1O9Uvad" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Grant Date Fair Value, Options exercised">0.83</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt; text-align: right"> </td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue_pn3n3_c20220101__20220331_zZo1K7WitwNj" style="border-bottom: Black 1.5pt solid; text-align: right" title="Aggregate Intrinsic value Options exercised">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Balances, March 31, 2022</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98F_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_pid_c20220101__20220331_fKDEp_zYPq8thpIzua" style="text-align: right" title="Number of Options, Balance at the end">3,631,002</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iE_pid_c20220101__20220331_zOUy2ksfkRjb" style="text-align: right" title="Weighted- Average Exercise Price Balances at the end">2.00</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98C_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20220101__20220331_zcx230gXUmf2" style="text-align: right" title="Weighted- Average Grant Date Fair Value,Balances at the end">1.39</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_900_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2_dtY_c20220101__20220331_zBu9E6fk6gmh" title="Weighted- Average Remaining Contractual Life (in years)">8.29</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iE_pn3n3_c20220101__20220331_zz3XrTx8ITA2" style="text-align: right" title="Aggregate Intrinsic value Balances at the end">6,377</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Balances, January 1, 2023</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98F_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_pid_c20230101__20230331_fKDEp_zeJnfmVQoYfb" style="text-align: right" title="Number of Options, Balance at the beginning">3,642,958</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_981_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iS_pid_c20230101__20230331_ziWZAYhjFABh" style="text-align: right" title="Weighted- Average Exercise Price - Balances at the beginning">2.02</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20230101__20230331_zovOqwHZuJ07" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Balances at the beginning">1.21</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90A_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm_dtY_c20230101__20230331_zADL6gKd18f8" title="Weighted- Average Remaining Contractual Life (in years)">7.90</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iS_pn3n3_c20230101__20230331_zq2mYLLCqhNj" style="text-align: right" title="Aggregate Intrinsic value Balances at the beginning">35,989</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Options granted</td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_pid_c20230101__20230331_fKDEp_z9AusgML7uO4" style="text-align: right" title="Number of Options granted">143,607</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zjCa99Owv9el" style="text-align: right" title="Weighted- Average Exercise Price Options granted">7.50</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331_zNIaBN2Br4V" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options granted">3.82</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98D_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantedInPeriodIntrinsicValue_pn3n3_c20230101__20230331_zUeILhwq4ZFj" style="text-align: right" title="Aggregate Intrinsic value Options granted">632</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Options forfeited</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_iN_pid_di_c20230101__20230331_fKDEp_zLYLex5dhAa" style="text-align: right" title="Number of Options forfeited">(19,164</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsForfeituresInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zvA9MdzkqtUe" style="text-align: right" title="Weighted- Average Exercise Price Options forfeited">7.27</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedOptionsForfeitedWeightedAverageGrantDateFairValue_pid_c20230101__20230331_zPCaNGzbRHW1" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options forfeited">3.71</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeitedInPeriodTotalIntrinsicValue_pn3n3_c20230101__20230331_zGbML20rMiY" style="text-align: right" title="Aggregate Intrinsic value Options forfeited">6</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Options exercised</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98B_eus-gaap--StockIssuedDuringPeriodSharesStockOptionsExercised_iN_pid_di_c20230101__20230331_fKDEp_zXmFQWGFh1Xc" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of Options exercised">(36,009</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zN8FASuJnPY2" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Exercise Price Options exercised">2.58</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageGrantDateFairValue_pid_c20230101__20230331_z6G0WlsNUOIg" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Grant Date Fair Value, Options exercised">1.65</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt; text-align: right"> </td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue_pn3n3_c20230101__20230331_zl2pPaWfTozf" style="border-bottom: Black 1.5pt solid; text-align: right" title="Aggregate Intrinsic value Options exercised">232</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Balances, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_pid_c20230101__20230331_fKDEp_zxThxa4X7o37" style="border-bottom: Black 2.5pt double; text-align: right" title="Number of Options, Balance at the end">3,731,392</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iE_pid_c20230101__20230331_zfYE6Pt0Dus3" style="border-bottom: Black 2.5pt double; text-align: right" title="Weighted- Average Exercise Price Balances at the end">2.20</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20230101__20230331_z3J53gevgwo2" style="border-bottom: Black 2.5pt double; text-align: right" title="Weighted- Average Grant Date Fair Value,Balances at the end">1.30</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt; text-align: right"><span id="xdx_90E_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2_dtY_c20230101__20230331_zJsulBFXY9pb" title="Weighted- Average Remaining Contractual Life (in years)">6.62</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iE_pn3n3_c20230101__20230331_zUml1rmlfXHf" style="border-bottom: Black 2.5pt double; text-align: right" title="Aggregate Intrinsic value Balances at the end">3,800</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">At March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Vested and Exercisable</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableNumber_iE_pid_c20230101__20230331_fKDEp_z6PZEE1Q9su8" style="text-align: right" title="Number of Options, Vested and Exercisable">2,029,985</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableWeightedAverageExercisePrice_iE_pid_c20230101__20230331_zPWjjBtLu5Cd" style="text-align: right" title="Weighted- Average Exercise Price Vested and Exercisable">1.53</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90B_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestExercisableWeightedAverageRemainingContractualTerm1_dtY_c20230101__20230331_zIk6mFgrJET1" title="Weighted- Average Remaining Contractual Life (in years)">4.98</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableAggregateIntrinsicValue_iE_pn3n3_c20230101__20230331_zmleBDznRpg6" style="text-align: right" title="Aggregate Intrinsic value Vested and Exercisable">3,120</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Vested and expected to vest</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingNumber_iE_pid_c20230101__20230331_fKDEp_zM4f8lES8uNd" style="text-align: right" title="Number of Options, Vested and expected to vest">3,731,392</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageExercisePrice_iE_pid_c20230101__20230331_z6oMLSetfqGg" style="text-align: right" title="Weighted- Average Exercise Price Vested and expected to vest (in dollars per share)">2.20</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_901_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageRemainingContractualTerm1_dtY_c20230101__20230331_zyvCxrEe2qd1" title="Weighted- Average Remaining Contractual Life (in years)">6.62</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingAggregateIntrinsicValue_iE_pn3n3_c20230101__20230331_zdNmhxLTGT1l" style="text-align: right" title="Aggregate Intrinsic value Vested and expected to vest">3,800</td><td style="text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 6pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 35pt; text-align: right">(1)</td><td style="text-align: justify">Number of options and weighted average exercise price has been adjusted to reflect the exchange of Legacy Dragonfly’s stock options for New Dragonfly stock options at an exchange ratio of approximately <span class="xdx_phnt_RGlzY2xvc3VyZSAtIFNDSEVEVUxFIE9GIE9QVElPTiBBQ1RJVklUWSBBTkQgUkVMQVRFRCBJTkZPUk1BVElPTiAoRGV0YWlscykgKFBhcmVudGhldGljYWwpAA__" id="xdx_900_eus-gaap--StockholdersEquityNoteStockSplitConversionRatio1_pid_uPure_c20230101__20230331_zLJK8C2wpyP6" title="Stock option exchange ratio">1.182 as a result of the merger.</td> </tr></table> Restricted Stock Units On October 7, 2022, the Company granted <span id="xdx_90A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iI_pid_c20221007__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zo39DC23nJq" title="Restricted Stock Units">180,000 restricted stock units under the 2022 plan which vest one year from the grant date. The fair value of the restricted stock units on the date of grant was $<span id="xdx_905_eus-gaap--StockIssuedDuringPeriodValueRestrictedStockAwardGross_pn3n3_c20221006__20221007__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zDRx5nzwWUYg" title="Restricted stock units, value">2,520, which is recognized as compensation expense over the requisite service period based on the value of the underlying shares on the date of grant. On February 10, 2023, the Company granted <span id="xdx_904_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iI_pid_c20230210__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zUQXmmNXDj63" title="Restricted Stock Units">461,998 restricted stock units under the 2022 plan which vest immediately. The fair value of the restricted stock units on the date of grant was $<span id="xdx_902_eus-gaap--StockIssuedDuringPeriodValueRestrictedStockAwardGross_pn3n3_c20230210__20230210__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zMywBvbL1Mie" title="Restricted stock units, value">3,464 and was recorded as compensation expense. Dragonfly Energy Holdings Corp. Notes to Unaudited Condensed Consolidated Financial Statements (in thousands, except share and per share data) NOTE 11 - STOCK-BASED COMPENSATION (CONTINUED) Restricted Stock Units (Continued) There were no grants of restricted stock units prior to October 7, 2022. The following table presents the restricted stock units activity for the three months ended March 31, 2023: SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Number of Shares</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Fair Market Value</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%; text-align: justify">Unvested shares at January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iS_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zGivYKZ8AdSf" style="width: 18%; text-align: right" title="Number of shares , beginning balance">180,000</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_z8hFgMH9y0X3" style="width: 18%; text-align: right" title="Weighted average fair market value , beginning balance"> 14.00</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Granted and unvested</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriod_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zSSFFzxLJfbh" style="text-align: right" title="Number of shares granted and unvested">461,998</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98D_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zfKWUHSdmbRi" style="text-align: right" title="Weighted average fair market value granted and unvested">7.50</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 1.5pt">Vested</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsVestedInPeriod_iN_pid_di_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zwckWFsfRzMk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of shares vested">(461,998</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsVestedInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zr4T3mH6SQt8" style="padding-bottom: 1.5pt; text-align: right" title="Weighted average fair market value vested">7.50</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 2.5pt">Unvested shares, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_985_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iE_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zYgwuCdCq9S6" style="border-bottom: Black 2.5pt double; text-align: right" title="Number of shares , ending balance">180,000</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt; text-align: left">$</td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zlC1wlGpR8zj" style="padding-bottom: 2.5pt; text-align: right" title="Weighted average fair market value , beginning balance">14.00</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Vested as of March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_z9zX2ZnBpv2b" style="text-align: right" title="Number of shares ,vested">461,998</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98B_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageFairMarketValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zM6WmwhAV1Dj" style="text-align: right" title="Weighted average fair market value,vested">7.50</td><td style="text-align: left"> </td></tr> </table> As of March 31, 2023, there were <span id="xdx_903_eus-gaap--ClassOfWarrantOrRightUnissued_iI_pid_c20230331__us-gaap--PlanNameAxis__custom--TwoThousandTwentyTwoEquityIncentiveAndEmployeeStockPurchasePlanMember_z0R21L0B1SG5" title="Unissued authorized and available for future awards">4,319,309 shares of unissued authorized and available for future awards under the 2022 Equity Incentive Plan and Employee Stock Purchase Plan.

4487000

288000

4487000

36000

29000

856000

3566000

288000

97000

37000

60000

94000

A summary of the Company’s option activity and related information follows: SCHEDULE OF OPTION ACTIVITY AND RELATED INFORMATION <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 100%"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Number of Options (1)</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Exercise Price</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Grant Date Fair Value</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; padding-bottom: 1.5pt; text-align: center">Weighted-Average Remaining Contractual Life (in years)</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Aggregate intrinsic value</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 35%; text-align: justify">Balances, January 1, 2022</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_pid_c20220101__20220331_fKDEp_zh4FJjfoV7J1" style="width: 9%; text-align: right" title="Number of Options, Balance at the beginning">3,690,955</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iS_pid_c20220101__20220331_zZIOsIjSlHz5" style="width: 9%; text-align: right" title="Weighted- Average Exercise Price - Balances at the beginning"> 1.98</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98F_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20220101__20220331_zbLl866Vllqc" style="width: 9%; text-align: right" title="Weighted- Average Grant Date Fair Value, Balances at the beginning"> 1.38</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td style="width: 9%; text-align: right"> <span id="xdx_90E_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm_dtY_c20220101__20220331_zJYhOcbmZBD7" title="Weighted- Average Remaining Contractual Life (in years)">8.52</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iS_pn3n3_c20220101__20220331_zNLHjMduMut3" style="width: 9%; text-align: right" title="Aggregate Intrinsic value Balances at the beginning">6,550</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Options granted</td><td> </td> <td style="text-align: left"> </td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_pid_c20220101__20220331_fKDEp_zH9qaSbcVz95" style="text-align: right" title="Number of Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_z6kjRntpmkNl" style="text-align: right" title="Weighted- Average Exercise Price Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zuABifId3Pkh" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options granted">-</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98C_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantedInPeriodIntrinsicValue_pn3n3_c20220101__20220331_zsL0LHg7Xskg" style="text-align: right" title="Aggregate Intrinsic value Options granted">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Options forfeited</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_iN_pid_di_c20220101__20220331_fKDEp_zw2BDk6NHqfh" style="text-align: right" title="Number of Options forfeited">(11,584</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsForfeituresInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_zxXHviSYJlRf" style="text-align: right" title="Weighted- Average Exercise Price Options forfeited">1.44</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedOptionsForfeitedWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zwFZHkpAr253" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options forfeited">2.17</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeitedInPeriodTotalIntrinsicValue_pn3n3_c20220101__20220331_zGfia9Vjo5a9" style="text-align: right" title="Aggregate Intrinsic value Options forfeited">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Options exercised</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--StockIssuedDuringPeriodSharesStockOptionsExercised_iN_pid_di_c20220101__20220331_fKDEp_zgjrJIDCWUJa" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of Options exercised">(48,369</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice_pid_c20220101__20220331_zbumZMndBBGa" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Exercise Price Options exercised">0.49</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_986_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageGrantDateFairValue_pid_c20220101__20220331_zZRiK1O9Uvad" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Grant Date Fair Value, Options exercised">0.83</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt; text-align: right"> </td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue_pn3n3_c20220101__20220331_zZo1K7WitwNj" style="border-bottom: Black 1.5pt solid; text-align: right" title="Aggregate Intrinsic value Options exercised">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Balances, March 31, 2022</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98F_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_pid_c20220101__20220331_fKDEp_zYPq8thpIzua" style="text-align: right" title="Number of Options, Balance at the end">3,631,002</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iE_pid_c20220101__20220331_zOUy2ksfkRjb" style="text-align: right" title="Weighted- Average Exercise Price Balances at the end">2.00</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98C_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20220101__20220331_zcx230gXUmf2" style="text-align: right" title="Weighted- Average Grant Date Fair Value,Balances at the end">1.39</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_900_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2_dtY_c20220101__20220331_zBu9E6fk6gmh" title="Weighted- Average Remaining Contractual Life (in years)">8.29</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_980_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iE_pn3n3_c20220101__20220331_zz3XrTx8ITA2" style="text-align: right" title="Aggregate Intrinsic value Balances at the end">6,377</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Balances, January 1, 2023</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98F_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iS_pid_c20230101__20230331_fKDEp_zeJnfmVQoYfb" style="text-align: right" title="Number of Options, Balance at the beginning">3,642,958</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_981_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iS_pid_c20230101__20230331_ziWZAYhjFABh" style="text-align: right" title="Weighted- Average Exercise Price - Balances at the beginning">2.02</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20230101__20230331_zovOqwHZuJ07" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Balances at the beginning">1.21</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90A_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm_dtY_c20230101__20230331_zADL6gKd18f8" title="Weighted- Average Remaining Contractual Life (in years)">7.90</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iS_pn3n3_c20230101__20230331_zq2mYLLCqhNj" style="text-align: right" title="Aggregate Intrinsic value Balances at the beginning">35,989</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Options granted</td><td> </td> <td style="text-align: left"> </td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross_pid_c20230101__20230331_fKDEp_z9AusgML7uO4" style="text-align: right" title="Number of Options granted">143,607</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zjCa99Owv9el" style="text-align: right" title="Weighted- Average Exercise Price Options granted">7.50</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331_zNIaBN2Br4V" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options granted">3.82</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98D_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantedInPeriodIntrinsicValue_pn3n3_c20230101__20230331_zUeILhwq4ZFj" style="text-align: right" title="Aggregate Intrinsic value Options granted">632</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Options forfeited</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod_iN_pid_di_c20230101__20230331_fKDEp_zLYLex5dhAa" style="text-align: right" title="Number of Options forfeited">(19,164</td><td style="text-align: left">)</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsForfeituresInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zvA9MdzkqtUe" style="text-align: right" title="Weighted- Average Exercise Price Options forfeited">7.27</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedOptionsForfeitedWeightedAverageGrantDateFairValue_pid_c20230101__20230331_zPCaNGzbRHW1" style="text-align: right" title="Weighted- Average Grant Date Fair Value, Options forfeited">3.71</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_986_ecustom--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeitedInPeriodTotalIntrinsicValue_pn3n3_c20230101__20230331_zGbML20rMiY" style="text-align: right" title="Aggregate Intrinsic value Options forfeited">6</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 1.5pt">Options exercised</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98B_eus-gaap--StockIssuedDuringPeriodSharesStockOptionsExercised_iN_pid_di_c20230101__20230331_fKDEp_zXmFQWGFh1Xc" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of Options exercised">(36,009</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_988_eus-gaap--ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice_pid_c20230101__20230331_zN8FASuJnPY2" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Exercise Price Options exercised">2.58</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_982_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageGrantDateFairValue_pid_c20230101__20230331_z6G0WlsNUOIg" style="border-bottom: Black 1.5pt solid; text-align: right" title="Weighted- Average Grant Date Fair Value, Options exercised">1.65</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt; text-align: right"> </td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98A_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue_pn3n3_c20230101__20230331_zl2pPaWfTozf" style="border-bottom: Black 1.5pt solid; text-align: right" title="Aggregate Intrinsic value Options exercised">232</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 2.5pt">Balances, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_983_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber_iE_pid_c20230101__20230331_fKDEp_zxThxa4X7o37" style="border-bottom: Black 2.5pt double; text-align: right" title="Number of Options, Balance at the end">3,731,392</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_98C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice_iE_pid_c20230101__20230331_zfYE6Pt0Dus3" style="border-bottom: Black 2.5pt double; text-align: right" title="Weighted- Average Exercise Price Balances at the end">2.20</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_983_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20230101__20230331_z3J53gevgwo2" style="border-bottom: Black 2.5pt double; text-align: right" title="Weighted- Average Grant Date Fair Value,Balances at the end">1.30</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt; text-align: right"><span id="xdx_90E_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2_dtY_c20230101__20230331_zJsulBFXY9pb" title="Weighted- Average Remaining Contractual Life (in years)">6.62</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue_iE_pn3n3_c20230101__20230331_zUml1rmlfXHf" style="border-bottom: Black 2.5pt double; text-align: right" title="Aggregate Intrinsic value Balances at the end">3,800</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">At March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Vested and Exercisable</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableNumber_iE_pid_c20230101__20230331_fKDEp_z6PZEE1Q9su8" style="text-align: right" title="Number of Options, Vested and Exercisable">2,029,985</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableWeightedAverageExercisePrice_iE_pid_c20230101__20230331_zPWjjBtLu5Cd" style="text-align: right" title="Weighted- Average Exercise Price Vested and Exercisable">1.53</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_90B_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestExercisableWeightedAverageRemainingContractualTerm1_dtY_c20230101__20230331_zIk6mFgrJET1" title="Weighted- Average Remaining Contractual Life (in years)">4.98</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_982_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableAggregateIntrinsicValue_iE_pn3n3_c20230101__20230331_zmleBDznRpg6" style="text-align: right" title="Aggregate Intrinsic value Vested and Exercisable">3,120</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify">Vested and expected to vest</td><td> </td> <td style="text-align: left"> </td><td id="xdx_98B_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingNumber_iE_pid_c20230101__20230331_fKDEp_zM4f8lES8uNd" style="text-align: right" title="Number of Options, Vested and expected to vest">3,731,392</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageExercisePrice_iE_pid_c20230101__20230331_z6oMLSetfqGg" style="text-align: right" title="Weighted- Average Exercise Price Vested and expected to vest (in dollars per share)">2.20</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"><span id="xdx_901_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageRemainingContractualTerm1_dtY_c20230101__20230331_zyvCxrEe2qd1" title="Weighted- Average Remaining Contractual Life (in years)">6.62</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98E_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingAggregateIntrinsicValue_iE_pn3n3_c20230101__20230331_zdNmhxLTGT1l" style="text-align: right" title="Aggregate Intrinsic value Vested and expected to vest">3,800</td><td style="text-align: left"> </td></tr> </table> <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 6pt; width: 100%"><tr style="vertical-align: top; text-align: justify"> <td style="width: 35pt; text-align: right">(1)</td><td style="text-align: justify">Number of options and weighted average exercise price has been adjusted to reflect the exchange of Legacy Dragonfly’s stock options for New Dragonfly stock options at an exchange ratio of approximately <span class="xdx_phnt_RGlzY2xvc3VyZSAtIFNDSEVEVUxFIE9GIE9QVElPTiBBQ1RJVklUWSBBTkQgUkVMQVRFRCBJTkZPUk1BVElPTiAoRGV0YWlscykgKFBhcmVudGhldGljYWwpAA__" id="xdx_900_eus-gaap--StockholdersEquityNoteStockSplitConversionRatio1_pid_uPure_c20230101__20230331_zLJK8C2wpyP6" title="Stock option exchange ratio">1.182 as a result of the merger.</td> </tr></table>

3690955

1.98

1.38

P8Y6M7D

6550000

11584

1.44

2.17

48369

0.49

0.83

3631002

2.00

1.39

P8Y3M14D

6377000

3642958

2.02

1.21

P7Y10M24D

35989000

143607

7.50

3.82

632000

19164

7.27

3.71

6000

36009

2.58

1.65

232000

3731392

2.20

1.30

P6Y7M13D

3800000

2029985

1.53

P4Y11M23D

3120000

3731392

2.20

P6Y7M13D

3800000

1.182

180000

2520000

461998

3464000

There were no grants of restricted stock units prior to October 7, 2022. The following table presents the restricted stock units activity for the three months ended March 31, 2023: SCHEDULE OF RESTRICTED STOCK UNITS ACTIVITY <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; border-collapse: collapse; width: 70%"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Number of Shares</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">Weighted-Average Fair Market Value</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%; text-align: justify">Unvested shares at January 1, 2023</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iS_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zGivYKZ8AdSf" style="width: 18%; text-align: right" title="Number of shares , beginning balance">180,000</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left">$</td><td id="xdx_98C_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedWeightedAverageGrantDateFairValue_iS_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_z8hFgMH9y0X3" style="width: 18%; text-align: right" title="Weighted average fair market value , beginning balance"> 14.00</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Granted and unvested</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriod_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zSSFFzxLJfbh" style="text-align: right" title="Number of shares granted and unvested">461,998</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98D_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsGrantsInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zfKWUHSdmbRi" style="text-align: right" title="Weighted average fair market value granted and unvested">7.50</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify; padding-bottom: 1.5pt">Vested</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_984_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsVestedInPeriod_iN_pid_di_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zwckWFsfRzMk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Number of shares vested">(461,998</td><td style="padding-bottom: 1.5pt; text-align: left">)</td><td style="padding-bottom: 1.5pt"> </td> <td style="padding-bottom: 1.5pt; text-align: left"> </td><td id="xdx_987_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsVestedInPeriodWeightedAverageGrantDateFairValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zr4T3mH6SQt8" style="padding-bottom: 1.5pt; text-align: right" title="Weighted average fair market value vested">7.50</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify; padding-bottom: 2.5pt">Unvested shares, March 31, 2023</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left"> </td><td id="xdx_985_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedNumber_iE_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zYgwuCdCq9S6" style="border-bottom: Black 2.5pt double; text-align: right" title="Number of shares , ending balance">180,000</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="padding-bottom: 2.5pt; text-align: left">$</td><td id="xdx_989_eus-gaap--ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsNonvestedWeightedAverageGrantDateFairValue_iE_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zlC1wlGpR8zj" style="padding-bottom: 2.5pt; text-align: right" title="Weighted average fair market value , beginning balance">14.00</td><td style="padding-bottom: 2.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: justify"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: justify">Vested as of March 31, 2023</td><td> </td> <td style="text-align: left"> </td><td id="xdx_984_eus-gaap--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedNumberOfShares_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_z9zX2ZnBpv2b" style="text-align: right" title="Number of shares ,vested">461,998</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td id="xdx_98B_ecustom--SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedWeightedAverageFairMarketValue_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zM6WmwhAV1Dj" style="text-align: right" title="Weighted average fair market value,vested">7.50</td><td style="text-align: left"> </td></tr> </table>

180000

14.00

461998

7.50

461998

7.50

180000

14.00

461998

7.50

4319309

NOTE 12 - EARNINGS (LOSS) PER SHARE Earnings (Loss) per Common Share The following table sets forth the information needed to compute basic and diluted earnings (loss) per share for the three months ended March 31, 2023 and 2022: SCHEDULE OF INFORMATION NEEDED TO COMPUTE BASIC AND DILUTED EARNINGS PER SHARE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_494_20230101__20230331_zUb0qjqERBg" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_497_20220101__20220331_zg6uUeXAFHV" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40C_eus-gaap--EarningsPerShareBasicAbstract_iB" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-weight: bold; text-align: left">Basic Earnings (Loss) per common share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--NetIncomeLossAvailableToCommonStockholdersBasic_i01_pn3n3_zSm3bg4cT3Ah" style="vertical-align: bottom; background-color: White"> <td style="width: 56%; text-align: left; padding-bottom: 2.5pt">Net Income (Loss) available to common shareholders</td><td style="width: 2%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 18%; text-align: right">4,892</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 18%; text-align: right">(2,298</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_405_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pid_zPnj0qCbboBe" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average number of common shares-basic</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,104,515</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--EarningsPerShareBasic_i01_pid_zcLr1vKHU77k" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt">Earnings (Loss) per share, basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.11</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.06</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--EarningsPerShareDilutedAbstract_iB" style="vertical-align: bottom; background-color: White"> <td style="font-weight: bold; text-align: left">Diluted Earnings (Loss) per common share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--NetIncomeLossAvailableToCommonStockholdersBasic_i01_pn3n3_zWkQsCDsIYIj" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Net Income (Loss) available to common shareholders</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">4,892</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">(2,298</td><td style="text-align: left">)</td></tr> <tr id="xdx_40D_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pid_zh85dveN6JSb" style="vertical-align: bottom; background-color: White"> <td>Weighted average number of common shares-basic</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,104,515</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--IncrementalCommonSharesAttributableToShareBasedPaymentArrangements_i01_pid_z3iPlRhaquB6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Dilutive effect related to stock options and warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,351,481</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--WeightedAverageNumberOfDilutedSharesOutstanding_i01_pid_zGy17kJp2E45" style="vertical-align: bottom; background-color: White"> <td>Weighted average diluted shares outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">48,455,996</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_40C_eus-gaap--EarningsPerShareDiluted_i01_pid_zGzTz05QJeBf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.5pt">Earnings (Loss) per share, diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.10</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.06</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> </table> <p id="xdx_89A_eus-gaap--ScheduleOfAntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareTextBlock_zkxah7r0Ts6a" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify">The following table sets forth the number of potential shares of common stock that have been excluded from diluted net income per share net income (loss) per share because their effect was anti-dilutive: SCHEDULE OF POTENTIAL SHARES OF COMMON STOCK EXCLUDED FROM DILUTED NET (LOSS) INCOME PER SHARE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%">Warrants</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98E_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zsKlHRxR2SXg" style="width: 18%; text-align: right" title="Purchase an aggregate shares">10,923,915</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98B_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zvGnY2pcVb5a" style="width: 18%; text-align: right" title="Purchase an aggregate shares">-</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Restricted stock units</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zeiAyavTeB5j" style="text-align: right" title="Purchase an aggregate shares">111,015</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98E_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zLc2NA2SqUZ1" style="text-align: right" title="Purchase an aggregate shares">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt">Options</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98B_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareByAntidilutiveSecuritiesAxis__us-gaap--EmployeeStockOptionMember_zTDWYEtxWfVk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareByAntidilutiveSecuritiesAxis__us-gaap--EmployeeStockOptionMember_zQa6kMPRMdNk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">3,631,002</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1.5pt">Weighted average number of common shares-basic</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_989_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331_zJW3iAQ1u5Ce" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">11,034,930</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98D_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331_zaIvNy14UwEj" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">3,631,002</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> </table>

The following table sets forth the information needed to compute basic and diluted earnings (loss) per share for the three months ended March 31, 2023 and 2022: SCHEDULE OF INFORMATION NEEDED TO COMPUTE BASIC AND DILUTED EARNINGS PER SHARE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_494_20230101__20230331_zUb0qjqERBg" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" id="xdx_497_20220101__20220331_zg6uUeXAFHV" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr id="xdx_40C_eus-gaap--EarningsPerShareBasicAbstract_iB" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="font-weight: bold; text-align: left">Basic Earnings (Loss) per common share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--NetIncomeLossAvailableToCommonStockholdersBasic_i01_pn3n3_zSm3bg4cT3Ah" style="vertical-align: bottom; background-color: White"> <td style="width: 56%; text-align: left; padding-bottom: 2.5pt">Net Income (Loss) available to common shareholders</td><td style="width: 2%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 18%; text-align: right">4,892</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left"> </td><td style="width: 2%; padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; width: 1%; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; width: 18%; text-align: right">(2,298</td><td style="width: 1%; padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr id="xdx_405_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pid_zPnj0qCbboBe" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td>Weighted average number of common shares-basic</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,104,515</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_404_eus-gaap--EarningsPerShareBasic_i01_pid_zcLr1vKHU77k" style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 2.5pt">Earnings (Loss) per share, basic</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.11</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.06</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_402_eus-gaap--EarningsPerShareDilutedAbstract_iB" style="vertical-align: bottom; background-color: White"> <td style="font-weight: bold; text-align: left">Diluted Earnings (Loss) per common share:</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right"> </td><td style="text-align: left"> </td></tr> <tr id="xdx_405_eus-gaap--NetIncomeLossAvailableToCommonStockholdersBasic_i01_pn3n3_zWkQsCDsIYIj" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left">Net Income (Loss) available to common shareholders</td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">4,892</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left">$</td><td style="text-align: right">(2,298</td><td style="text-align: left">)</td></tr> <tr id="xdx_40D_eus-gaap--WeightedAverageNumberOfSharesOutstandingBasic_i01_pid_zh85dveN6JSb" style="vertical-align: bottom; background-color: White"> <td>Weighted average number of common shares-basic</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">45,104,515</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_40D_eus-gaap--IncrementalCommonSharesAttributableToShareBasedPaymentArrangements_i01_pid_z3iPlRhaquB6" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="text-align: left; padding-bottom: 1.5pt">Dilutive effect related to stock options and warrants</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">3,351,481</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td style="border-bottom: Black 1.5pt solid; text-align: right">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr id="xdx_400_eus-gaap--WeightedAverageNumberOfDilutedSharesOutstanding_i01_pid_zGy17kJp2E45" style="vertical-align: bottom; background-color: White"> <td>Weighted average diluted shares outstanding</td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">48,455,996</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td style="text-align: right">36,542,944</td><td style="text-align: left"> </td></tr> <tr id="xdx_40C_eus-gaap--EarningsPerShareDiluted_i01_pid_zGzTz05QJeBf" style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 2.5pt">Earnings (Loss) per share, diluted</td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">0.10</td><td style="padding-bottom: 2.5pt; text-align: left"> </td><td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: Black 2.5pt double; text-align: left">$</td><td style="border-bottom: Black 2.5pt double; text-align: right">(0.06</td><td style="padding-bottom: 2.5pt; text-align: left">)</td></tr> </table>

4892000

-2298000

45104515

36542944

0.11

-0.06

4892000

-2298000

45104515

36542944

3351481

48455996

36542944

0.10

-0.06

<p id="xdx_89A_eus-gaap--ScheduleOfAntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareTextBlock_zkxah7r0Ts6a" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify">The following table sets forth the number of potential shares of common stock that have been excluded from diluted net income per share net income (loss) per share because their effect was anti-dilutive: SCHEDULE OF POTENTIAL SHARES OF COMMON STOCK EXCLUDED FROM DILUTED NET (LOSS) INCOME PER SHARE <table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-left: auto; border-collapse: collapse; width: 90%; margin-right: auto"> <tr style="vertical-align: bottom"> <td> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2023</td><td style="padding-bottom: 1.5pt"> </td><td style="padding-bottom: 1.5pt"> </td> <td colspan="2" style="border-bottom: Black 1.5pt solid; text-align: center">March 31, 2022</td><td style="padding-bottom: 1.5pt"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="width: 56%">Warrants</td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98E_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zsKlHRxR2SXg" style="width: 18%; text-align: right" title="Purchase an aggregate shares">10,923,915</td><td style="width: 1%; text-align: left"> </td><td style="width: 2%"> </td> <td style="width: 1%; text-align: left"> </td><td id="xdx_98B_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--StatementEquityComponentsAxis__us-gaap--WarrantMember_zvGnY2pcVb5a" style="width: 18%; text-align: right" title="Purchase an aggregate shares">-</td><td style="width: 1%; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="text-align: left">Restricted stock units</td><td> </td> <td style="text-align: left"> </td><td id="xdx_981_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zeiAyavTeB5j" style="text-align: right" title="Purchase an aggregate shares">111,015</td><td style="text-align: left"> </td><td> </td> <td style="text-align: left"> </td><td id="xdx_98E_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--AwardTypeAxis__us-gaap--RestrictedStockUnitsRSUMember_zLc2NA2SqUZ1" style="text-align: right" title="Purchase an aggregate shares">-</td><td style="text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: rgb(204,238,255)"> <td style="padding-bottom: 1.5pt">Options</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98B_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331__us-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareByAntidilutiveSecuritiesAxis__us-gaap--EmployeeStockOptionMember_zTDWYEtxWfVk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">-</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_987_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331__us-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareByAntidilutiveSecuritiesAxis__us-gaap--EmployeeStockOptionMember_zQa6kMPRMdNk" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">3,631,002</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> <tr style="vertical-align: bottom; background-color: White"> <td style="padding-bottom: 1.5pt">Weighted average number of common shares-basic</td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_989_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20230101__20230331_zJW3iAQ1u5Ce" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">11,034,930</td><td style="padding-bottom: 1.5pt; text-align: left"> </td><td style="padding-bottom: 1.5pt"> </td> <td style="border-bottom: Black 1.5pt solid; text-align: left"> </td><td id="xdx_98D_eus-gaap--AntidilutiveSecuritiesExcludedFromComputationOfEarningsPerShareAmount_pid_c20220101__20220331_zaIvNy14UwEj" style="border-bottom: Black 1.5pt solid; text-align: right" title="Purchase an aggregate shares">3,631,002</td><td style="padding-bottom: 1.5pt; text-align: left"> </td></tr> </table>

10923915

111015

3631002

11034930

3631002

NOTE 13 – INCOME TAXES The Company’s tax provision and the resulting effective tax rate for interim periods is determined based upon its estimated annual effective tax rate adjusted for the effect of discrete items arising in that quarter. The Company recorded an income tax expense (benefit) of $0 and ($527) during the three months ended March 31, 2023 and 2022, respectively. The effective tax rate differs from the U.S. statutory tax rate primarily due to the valuation allowances on the Company’s deferred tax assets as it is more likely than not that some or all the Company’s deferred tax assets will not be realized. The Company’s policy is to recognize interest and penalties associated with uncertain tax benefits as part of the income tax provision and include accrued interest and penalties with the related income tax liability on the Company’s condensed consolidated balance sheets. The Company has not recognized any interest and penalties in its condensed consolidated statements of operations, nor has it accrued for or made payments for interest and penalties.

-527000

NOTE 14 – SUBSEQUENT EVENTS On April 1, 2023 the Company paid the $<span id="xdx_909_eus-gaap--ConvertibleNotesPayableCurrent_iI_pn3n3_c20230401__us-gaap--SubsequentEventTypeAxis__us-gaap--SubsequentEventMember__srt--TitleOfIndividualAxis__srt--BoardOfDirectorsChairmanMember_zLURMp7gOD35" title="Promissory note">1,000 Principal Amount on the Note previously issued to Brian Nelson on March 5, 2023. Upon execution of the Note and funding of the Principal Amount, a payment of the $100 Loan Fee, was fully earned as of the date of the note and was due and paid in full in cash on April 4, 2023. On April 26, 2023 (the “Separation Date”), the Company’s Chief Legal Officer’s employment with the Company ended and her employment agreement was deemed terminated as of that date by the Company without cause for purposes of determining severance thereunder. Under the terms of her employment agreement, Ms. Harvey is entitled to receive cash severance equal to $334,000 payable in 52 biweekly installments commencing 30 days from the Separation Date. Ms. Harvey’s outstanding options granted by the Company fully vested, and are exercisable for three (3) months following the Separation Date.

1000000

100000

334000000

Represents scheduled payments for the remaining nine-month period ending December 31, 2023. Represents scheduled payments for the remaining nine-month period ending December 31, 2023 Number of options and weighted average exercise price has been adjusted to reflect the exchange of Legacy Dragonfly’s stock options for New Dragonfly stock options at an exchange ratio of approximately 1.182 as a result of the merger.