MULLEN AUTOMOTIVE INC

References in this Annual Report to the “Company”, “we”, “us”, “our” or similar references, or “Mullen,” mean Mullen Automotive Inc., a Delaware corporation, and its subsidiariesOttava Automotive, Inc., a California corporation, Mullen Real Estate, LLC., a Delaware corporation, Mullen Investment Properties LLC, a Mississippi corporation,and Bollinger Motors, Incorporated a consolidated subsidiary.

Background

We are a Southern California-based electric vehicle company that operates in various verticals of businesses focused within the automotive industry. The Company was originally formed on April 20, 2010, as a developer and manufacturer of electric vehicle technology. During 2021, the Company completed a merger with Net Element, Inc., a Delaware-incorporated company 1. The Company changed its name from “Net Element, Inc.” to “Mullen Automotive Inc.” The Nasdaq Stock Market, LLC (Nasdaq Capital Market) ticker symbol for the Company’s common stock changed from “NETE” to “MULN” at the opening of trading on November 5, 2021. The CUSIP number of the common stock is 62526P 406.

The Company

Mullen Automotive is a Southern California-based automotive company that is building and delivering the newest generation of Commercial Trucks. We also have a portfolio of high-performance Passenger vehicles in various stages of Product Development for launch in subsequent years.

The company entered the Commercial Truck Business executing two opportunistic acquisitions in the fourth quarter of 2022. On September 7, 2022, the first acquisition was announced of Bollinger Motors. The purchase price was $148.6 million in cash and stock for a 60.0% controlling interest, which gives Mullen the majority ownership of Bollinger Motors, Inc. This provided Mullen entry into the medium duty truck classes 4-6, and the Sport Utility and Pick Up Truck EV segments.

The second acquisition was in October 2022, when the U.S. Bankruptcy Court approved the Company acquisition ELMS’ (Electric Last Mile Solutions) assets in an all-cash purchase. With this transaction, Mullen acquired ELMS’ manufacturing plant in Mishawaka Indiana and all the intellectual property needed to engineer and build Class 1 and Class 3 electric vehicles.

These two acquisitions give Mullen the most complete portfolio coverage in the Commercial EV truck market from Class 1 to 6 where there is very little current competition and, in some segments, no other announced entries.

Mullen’s Tunica Mississippi manufacturing plant was equipped during 2023 to become the Commercial Manufacturing Center. Tunica was commissioned with two lines to manufacture the Class 1 and 3 vehicles and began shipping Class 3 trucks in September 2023.

The Mullen FIVE, the Company’s first electric crossover, is slated to start European production in late 2025. Early drivable concept vehicles have been extensively previewed by Customers through 24 Marketing events at tracks nationwide during 2022 and 2023. The response to the styling, technology and performance has been very positive. The plan is for initial introduction to be in Europe for the low volume RS Super high-performance version, followed by the GT high volume entry in the US if the introduction in Europe is successful.

1 The Merger was accounted for as a reverse merger transaction, in which Mullen Automotive-California is treated as the acquirer for financial accounting purposes. For more information on the Merger, see “The Merger and Related Transactions.”

Company Overview

Our Strength and Strategy

Our Market Opportunity

There is a significant transformation going on in the motor vehicle landscape. Electric vehicles are quickly becoming mainstream as all major OEM’s have announced billions of dollars of investments to quickly transform their entire from gas powered to electric propulsion. Mullen is at the forefront of this transformation leading the way in Commercial Trucks

The Importance of Commercial and Fleet Business Segments

Fleet and Commercial segments represent a large portion of the total U.S. commercial market and includes Government, Commercial and Rental segments. Mullen’s Fleet First strategy takes advantage of segments vacated by competitors and allows a first mover advantage for the company. Our goal is to build strong customer relationships with fleet operators to capture a significant market opportunity as the broad trend of vehicle electrification continues.

The decisions for Fleet Customer to purchase an EV versus a gas-powered vehicle is pragmatic, a business decision relying on cost variables and company strategies rather than the decision processes that a retail customer includes in their purchase decision. There are generally well-known routes and duty cycles that allow a good match between range capabilities of the vehicles and required range, making the early adoption of EV’s in the Commercial space.

Our Commercial Portfolio of Vehicles

Mullen THREE

**Bollinger B4 Chassis Cab:**The all-new Bollinger B4 chassis is designed from the ground up with fleet efficiency as its first priority. With a GVWR of 15,500 pounds, the Bollinger B4 can carry over 7,325 lbs. of payload when equipped with dual battery packs. With a 158 in. wheelbase, this chassis can be upfitted with a body length up to 18 ft., yet still be capable of an impressive turning circle, making this truck an excellent choice for urban and semi-urban driving. Every aspect of these trucks has been streamlined to be as versatile as possible. The cab forward design provides better visibility and frees up space behind the driver for more cargo area. Bollinger Class 4 production launch begins in the second half of calendar 2024. Bollinger is also planning to launch Class 5 and Class 6 vehicles in the coming years.

Mullen Passenger Vehicle Portfolio

Mullen FIVE and Mullen FIVE RS

Bollinger B1 and B2

BOLLINGER B1 SUV

By designing an electric all wheel-drive SUV from the ground up, the Bollinger Motors team created a new platform of electric trucks capable of exceptional off road performance, combined with never-before-seen cargo and utility features. The Bollinger electric truck dual-motor drivetrain offers outstanding horsepower and torque, 50/50 weight distribution, unbeatable traction and best-in-class ground clearance boasting a 10" to 20" adjustable ride height.

BOLLINGER B2 PICKUP

The Bollinger B2 electric pickup truck is the big brother of the B1 with identical DNA. It offers the same functionality inside and out, except in a long-bed pickup truck version. This electric truck features a six-foot bed that is capable of carrying 16-foot long cargo through a patented full-vehicle-length pass-through with gates closed.

Battery Technology

The Company plans to use is using Li-Ion technology for its first vehicles supplied from world leader CATL. Lithium Iron Phosphate chemistry has proven to be the best combination for Commercial vehicles when balancing cost and performance.

As part of our strategy to increase our vertical integration of critical systems, Mullen purchased the assets of Romeo Power in September 2023 for $3.5 million. This included battery production lines as well as a significant amount of inventory for pack production and the IP to produce the Legions and Hermes battery systems. Mullen recently announced addition of a new facility in Fullerton California for the Romeo equipment to be installed. When in production, the in-house made Mullen battery packs will reduce reliance on third party suppliers and reduce supply chain risks in a very critical area of the vehicle.

Romeo Production Lines being installed in new Mullen Battery Facility

Solid State Development

The company is engaged in current product development and testing on solid state polymer technology with two suppliers. We are planning to first test the modules that have been engineered to be installed in the Class 1 Cargo Van, and subsequently perform drivable vehicle testing vehicle in the first calendar quarter of 2024. The Company plans to introduce this technology into the production Commercial vehicle lines after full vehicle testing and certification has been completed.

Our Vehicle Manufacturing Approach

We have a 124,700 sq ft facility located in Tunica, Mississippi that was purchased during 2021 and there is a 15,000 square-foot expansion for incoming inventory and finished product shipping commencing in the first calendar quarter of 2024. After equipment installation, debug trials and final quality control buy-off, the Class 3 line produced and shipped its first vehicles in September 2023. Following that, the Class 1 assembly line began production in November.

Passenger Division Manufacturing Operations

Through the ELMS asset acquisition, Mullen acquired a 675,000 sq ft manufacturing facility. This was the original manufacturing plant for General Motors Hummer H2 production, and later the Mercedes-Benz R-Class. There have been

many upgrades to the plant by the prior owners and most importantly the plant has been converted to manufacture Electric Vehicles. The plant is currently planned to produce the Mullen FIVE and Bollinger B1 and B2 vehicles.

Mullen Commercial Sales, Service and Distribution

The commercial sales and distribution plan is to form partnerships with strong existing top performing commercial dealerships that will cover the National fleet business requirements.

On December 13, 2022, the Company announced Randy Marion Isuzu LLC as its first dealer group partner for Mullen’s commercial EV lineup. The Marion group have signed two significant Purchase orders the first for 6,000 Class 1 vehicles in December 2022 valued at $200 million and the second for 1,000 Class 3 trucks valued at $63 million.

Additional large commercial dealers have been identified and will be added in 2024 to expand the national coverage, based on criteria driven by potential customers, size of fleets and state incentives.

Government Procurement Programs

The Company also plans to focus on U.S. Government vehicle procurement programs. The Biden administration issued an executive order in 2021 focused on revitalizing the electric-vehicle (EV) program of the U.S. government, requiring the replacement of the government’s entire fleet of about 650,000 vehicles with American-made EVs. The Company focus is establishing Mullen’s EV lineup within the overall federal fleet procurement process. with a partner organization RRDS that has extensive experience in Government sales. The application for approval for sales was submitted jointly with RRDS on November 24, 2023.

After Sales Strategy

To ensure all Customers nationwide have access to fast response for required servicing of their vehicles, Mullen has partnered with Amerit Fleet Solutions using both their facilities and mobile vehicles. Amerit technicians have been trained and are ready to service beginning with first Customer deliveries.

Vehicle Fleet Connectivity

To assist fleets to improve their operating costs, safety and productivity, Mullen offers their Advanced Telematics System Pulse which provides Driver and Fleet Manager connectivity to the vehicles with real time alerts for vehicle location, routing, maintenance alerts, and battery state of charge.

Marketing Strategy

Consumer Marketing of Passenger and Commercial Vehicles

Beginning in October 2022, the Company launched the “Strikingly Different” EV Tour of the Mullen FIVE EV Crossover where the public had the opportunity to interact with and ride in the vehicle in nine major cities across the United States. The Mullen FIVE EV Crossover vehicle on tour was equipped with a completely updated infotainment system featuring PERSONA, Mullen’s AI-powered proprietary advanced facial recognition technology, which bridges the gap between driver and vehicle by personalizing the overall vehicle experience. Participants had the opportunity to interact with and witness PERSONA in action.

With the tremendous success of the Mullen FIVE tour in 2022, the 2023 Ride and Drive was significantly expanded to feature more vehicles from Mullen’s line of consumer and commercial EVs as well as more stops across the United States. The Mullen EVs featured on tour included:

The 13 tour stops in 2023 were at speedways and other exciting venues with focus on the south, northeast, Midwest and western part of the U.S.

Tour participants had the chance to test drive the commercial vehicles and ride in the high-performance passenger EVs on racetracks with a professional driver. The reason speedways were selected as tour stops was to demonstrate the power of the Mullen FIVE RS, an ultra-high-performance EV that will feature a top speed of over 200 mph and acceleration from 0-60 mph in just 1.95 seconds. The vehicle is equipped with 800-volt architecture, all-wheel drive, a two-speed gearbox, and over 1,000 horsepower.

The tour was provided Mullen with the opportunity to increase brand awareness, allow potential customers to test drive the vehicles for themselves. experience the technology firsthand, and gather consumer feedback.

Commercial Vehicle Marketing

In 2023, we began planning and executing a strategic marketing initiative surrounding Mullen’s new commercial products, the Mullen ONE and the Mullen THREE. These initiatives included Email Blasts, Social Media, Paid Advertising, Press Releases, Editorial Content, Sponsorships and sixteen regional and national tradeshows. Mullen is working with key partner-agencies on advertising, tradeshows and events, social media and videography. In the upcoming year, we will execute commercial marketing initiatives through regional and national tradeshows, extended online presence, event partnership initiatives and broadened sales outreach.

In addition to the tradeshow attendance, the commercial vehicle lineup was available for test drives on the Strikingly Different Tour. Various commercial customers discussed their particular use case for fleet vehicles with our knowledgeable sales team and experienced the commercial vehicles firsthand.

On August 24th, 2023, Mullen held a Commercial Vehicle Launch event to provide attendees the opportunity to visit Mullen’s Tunica facility, learn about the manufacturing process, participate in product walk around and test drive the Mullen ONE and Mullen THREE. Attendees included local county and state leadership, media, investors and customers.

Commercial and Advertising

During 2023, the commercial team’s marketing and advertising efforts focused on building brand awareness, generating and nurturing leads and educating customers about our products. We have partnered with multiple fleet publishers to create email, print, web, and social marketing campaigns. We have leveraged Mullen’s social media platforms and online presence to keep our brand top of mind. We have purchased segmented lists of customers & companies that are purchasing similar vehicles to the Mullen ONE and Mullen THREE, with geographic locations in green states.

The Commercial Marketing team is building on the successful marketing efforts of 2023 to enhance our strategic approach for 2024. We will continue to maintain our web presence, marketing outreach, and participation in national tradeshows. Our sales team is engaged in attending several regional tradeshows and increasing our pilot program availability. We are also launching an upfitter partnership program to include our vehicles in various upfitter booths at local, regional and national tradeshow events. Our marketing and advertising efforts are being expanded into industry segment publications and we are increasing our online visibility.

Commercial Sales Outreach

We have leveraged our sales team's 100+ years of experience in the fleet sector to build relationships with potential customers, upfitters, fleet management companies and dealerships. Our team engaged contacts via cold calling/emailing, events, incoming website leads, third-party site leads, referrals and personal relationships.

We successfully built a pilot program for large fleets and organizations to test our vehicles across their use case and environment. The pilot program is a critical piece to our overall go to market strategy and has provided resourceful feedback for product development, interest and sales volume.

The sales team has actively participated in dealer training, test drive availability, networking with upfitters, and preparing and inspecting demonstration units.

Commercial Dealer Engagement

Working hand in hand with our initial dealer partner, we have armed their sales team with all of the pertinent information about our Commercial Product line enabling them to successfully sell our vehicles. Mullen’s team launched an initial sales kick off covering topics including commercial vehicle walkarounds, product overviews, marketing initiatives, advertising support, upfitter readiness, Mullen’s Commercial Dealer Portal, Commercial Pulse, aftersales support, sales strategies and sales initiatives. Mullen will continue training initiatives in the coming weeks ensuring synergies between the commercial brand and Randy Marion Automotive Group (RMA).

Research and Development

As an emerging automaker, we will rely heavily on research and development to establish and strengthen our market position. We will primarily conduct our research and development activities in Irvine, California, for the Mullen FIVE and at our Troy, Michigan and Oak Park Michigan facilities for our Commercial Platforms. During the fiscal year ended September 30, 2023, we incurred research and development expense of approximately $77.4 million. Expenses consisted primarily of personnel costs for our teams in engineering as well as contract and professional services that included the production of several demonstrator vehicles.

Intellectual Property

We place a strong emphasis on our innovative approach and proprietary designs which bring intrinsic value and uniqueness to our product portfolio. As part of our business, we seek to protect the underlying intellectual property rights of these innovations and designs such as with respect to patents, trademarks, trade secrets and other measures, including through employee and third-party nondisclosure agreements and other contractual arrangements. Our success depends in part upon our ability to protect our core technology and intellectual property. We have nondisclosure and invention assignment agreements with our consultants and employees, and we seek to control access to and distribution of our proprietary information through non-disclosure agreements with our vendors and business partners.

Trademarks and Patents

We plan to file additional applications for the registration of our trademarks and issuances of patents in the United States and foreign jurisdictions as our business expands under current and planned distribution arrangements. Protection of registered trademarks and issued patents in some jurisdictions may not be as extensive as the protection provided by the United States. There are no assurances given that pending applications will be granted or that they will, if granted, contain all of the claims currently included in the applications.* Refer to Intellectual Property Table.*

Trade Secrets

We own certain intellectual property, including trade secrets, which we seek to protect, in part, through confidentiality agreements with employees and other parties. Even where these agreements exist, there can be no assurance that these agreements will not be breached, that we would have adequate remedies for any breach, or that our trade secrets will not otherwise become known to or independently developed by competitors.

We intend to protect our legal rights concerning intellectual property by all appropriate legal action. Consequently, we may become involved from time to time in litigation to determine the enforceability, scope, and validity of any of the foregoing proprietary rights. Any patent litigation could result in substantial cost and divert the efforts of management and technical personnel.

Government Regulation and Credits

We operate in an industry that is subject to extensive environmental regulation, which has become more stringent over time. The laws and regulations to which we are subject govern, among others, water use; air emissions; use of recycled

materials; energy sources; the storage, handling, treatment, transportation and disposal of hazardous materials; the protection of the environment, natural resources and endangered species; and the remediation of environmental contamination. Compliance with such laws and regulations at an international, regional, national, state and local level is an important aspect of our ability to continue our operations.

Environmental standards applicable to us are established by the laws and regulations of the countries in which we operate, including standards adopted by regulatory agencies as well as the permits and licenses required by such agencies. Each of these sources is subject to periodic modifications and we anticipate increasingly stringent requirements. Violations of these laws, regulations or permits and licenses may result in substantial civil and criminal fines, penalties, and possibly orders to cease the violating operations or to conduct or pay for corrective works. In some instances, violations may also result in the suspension or revocation of permits and licenses.

Emissions

In the Unites States, Europe and China, there are vehicle emissions performance standards that may provide an opportunity for us to sell emissions credits.

United States

The United States Environmental Protection Agency (EPA) issues NMOG + NOx and GHG CO2 emissions credits per §§ 86.1811 and 86.1816 and the fleet-average evaporative emission standards from § 86.1813 as described in 40 CFR part 1037, current Model Year Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles Regulation and are paid in relation to vehicles sold and registered in the U.S. (section 177 states).

California has greenhouse gas emissions standards that closely follow the standards of the EPA. The registration and sale of Zero-Emission Vehicles (ZEVs) in California will earn us ZEV credits that we can sell to other Original Equipment Manufacturers (OEMs). Other states within the United States have adopted similar standards include Colorado, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington state and Washington D.C. (Section 177 states). “Section 177 state” means a state that is administering the California ZEV requirements pursuant to section 177 of the federal Clean Air Act (42 U.S.C. § 7507). We intend to take advantage of these regimes by registering and selling ZEVs in these other states.

ZEV credits in California are calculated under the 13 California Code of Regulations (CCR) § 1962.2 Zero-Emission Vehicle Standards for 2018 through 2025 Model Year Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles Regulation and are paid in relation to ZEVs sold and registered in California including Battery Electric Vehicles (BEVs) and Fuel Cell Electric Vehicles (FCEVs).

The ZEV program assigns ZEV credits to each vehicle manufacturer. Vehicle manufacturers are required to maintain ZEV credits equal to a set percentage of non-electric vehicles sold and registered in California.

Each vehicle sold and registered in California earns a number of credits based on the drivetrain type and the all-electric range (“AER”) of the vehicle under the Urban Dynamometer Driving Schedule Test Cycle. Plug-in hybrid vehicles (“PHEVs”) receive between 0.4 and 1.3 credits per vehicle sold and registered in California. Battery electric and fuel cell vehicles receive between one and four credits per vehicle sold in California, based on range.

The credit requirement was 7% in 2019 which required about 3% of sales to be ZEVs. The credit requirement will rise to 22% in 2025, which will require about 8% of sales to be ZEVs.

If a vehicle manufacturer does not produce enough EVs to meet its quota, it can choose to buy credits from other manufacturers who do or pay fines for each credit such manufacturer is short. This could provide an opportunity for us to sell credits to other manufacturers that may not have met their quota.

EPA / CARB Emissions and Certificate of Conformity / Executive Order

The United States Clean Air Act requires that we obtain a Certificate of Conformity (CoC) issued by the EPA and a California Executive Order (EO) issued by the California Air Resources Board (CARB) concerning emissions for our vehicles. A Certificate of Conformity is required for vehicles sold in states covered by the Clean Air Act’s standards, and an Executive Order is required for vehicles sold in states that have sought and received a waiver from the EPA to utilize California standards. CARB sets the California standards for emissions control for certain regulated pollutants for new vehicles and engines sold in California. States that have adopted the California standards as approved by EPA also recognize the Executive Order for sales of vehicles. There are currently eight states (Colorado, Maryland, Massachusetts, New Jersey, New York, Oregon, Vermont and Washington state) which have adopted the California standard for heavy-duty vehicles.

The Greenhouse Gas Rule was incorporated into the Clean Air Act on August 9, 2011. Even though Mullen’s vehicles have zero-emissions, Mullen is still required to seek an EPA Certificate of Conformity for the Greenhouse Gas Rule and a CARB Executive Order for the CARB Greenhouse Gas Rule. Annual fees must be paid per the EPA’s Motor Vehicle and Engine Compliance Program (MVECP) that are required per every model year of compliant Light-Duty Vehicles, Light-Duty Trucks, Medium-Duty Vehicles and Heavy-Duty Vehicles.

Mullen has received EPA Certificate of Conformity for both Class 1 and Class 3 vehicles. In addition, the California EO has been issued by the CARB for the Mullen ONE. Approval by CARB for the Mullen THREE is expected in January 2024.

Vehicle Safety and Testing

Our vehicles will be subject to, and will be required to comply with, numerous regulatory requirements established by the National Highway Traffic Safety Administration (NHTSA), including applicable United States Federal Motor Vehicle Safety Standards (FMVSS). All Mullen products will fully comply with all applicable FMVSS without the need for any exemptions and expect our future vehicles to either fully comply or comply with limited exemptions related to specific new technologies.

As a registered manufacturer with NHTSA, we must self-certify that our vehicles comply with all applicable FMVSSs, before the vehicles can be sold in the U.S. Some examples of FMVSS rules that will apply to our vehicles are crashworthiness, crash avoidance and specific Electric Vehicle (EV) requirements. We will also be required to comply with other federal regulations administered by multiple departments within the Federal Government; the Department of Transportation (DOT), including but not limited to 49 CFR Part 541;Theft Prevention Act requirements, 49 CFR Part 575; Consumer information requirements, Early Warning Reporting requirements regarding warranty claims, field reports, 49 CFR Part 573; Defect and Noncompliance Responsibility, 49 CFR Part 577; Defect and Noncompliance Notification, the Federal Communications Commission (FCC), including but not limited to 47 CFR Part 15; Radio Frequency Devices and the EPA; including but not limited to 40 CFR Part 86; Control of Emissions from New and In-Use Highway Vehicles and Engines, 40 CFR Part 600; Fuel Economy and Greenhouse Gas Exhaust Emissions of Motor Vehicles.

The Automobile Information and Disclosure Act requires manufacturers of motor vehicles to disclose certain information regarding the manufacturer’s suggested retail price, optional equipment and pricing. In addition, this law allows inclusion of city and highway ‘fuel economy’ ratings, as determined by the EPA, as well as crash test ratings as determined by the NHTSA if such tests are conducted.

Human Capital Resources

Talent Attraction and Capability Assessment

Where and how we source our talent evolves as conditions and opportunities change. From a capability perspective, we are leveraging best practices in assessments and talent management to current capabilities and future pipeline while reinforcing a culture of belonging, empowerment, and innovation.

Diversity and Inclusion

We strive to attract a pool of diverse and exceptional candidates and support their career growth once they become employees. In addition, we seek to hire based on talent rather than solely on educational pedigree. We also believe that our ability to retain our workforce is dependent on our ability to foster an environment that is sustainably safe, respectful, fair, and inclusive of everyone and promotes diversity, equity and inclusion inside and outside of our business.

Our Employees

As of September 30, 2023, we employed 326 full-time employees. Most of our employees are engaged in automotive, finance, and engineering related functions. To date, we have not experienced any work stoppages and consider our relationship with our employees to be in good standing. None of our employees are represented by a labor union or subject to a collective bargaining agreement.

Available Information

We are subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and file or furnish reports, proxy statements, and other information with the SEC. You can read our SEC filings over the Internet at the SEC’s website at www.sec.gov. Our filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and any amendments to those reports, also are available free of charge on the investors section of our website at www.mullenusa.com when such reports are available on the SEC’s website. Further corporate governance information, including our certificate of incorporation, bylaws, governance guidelines, board committee charters, and code of business conduct and ethics, is also available on the investors section of our website.

The contents of the websites referred to above are not incorporated into this filing or in any other report or document we file with the SEC, and any references to these websites are intended to be inactive textual references only.