Grid AI Corp Develops AI Data Center Energy Platform

EX-99.3 5 tm2611367d1_ex99-3.htm EXHIBIT 99.3

Exhibit 99.3

Business Description

Grid AI Corp. (“Grid AI” or the “Company”)
develops software and services designed to accelerate power availability and optimize energy infrastructure for artificial intelligence
(AI) data centers and other large energy users. The Company is currently in the development stage of an AI data center platform. This
platform aims to use and optimize distributed energy resources, including battery energy storage systems, on-site generation, and grid
interconnections. Currently, there is no revenue generated from this AI data center platform. The Company’s commercial pipeline
has recently been re-established and is continuing to develop through consulting-led engagements and targeted business development initiatives.
Current discussions are primarily with battery energy storage system (BESS) providers and energy infrastructure participants, including
companies such as Mango Power and Nomad Transportable Power Systems. While prior trial deployments, including in Australia, have not yet
resulted in significant commercial revenue, these efforts have informed management’s strategy to focus on lower-friction, near-term
opportunities that can be pursued with limited incremental cost. Market conditions vary significantly by geography, and the Company is
prioritizing regions and use cases where its platform can be more readily adopted.The Company does not have any major customers at the
present time and in the future aims to primarily serve AI data center developers, hyperscalers (large-scale cloud service providers that
operate extensive computing, storage, and networking infrastructure to support enterprise applications and AI workloads), and energy infrastructure
developers in North America and Australia.

Notwithstanding the early-stage nature of commercialization,
the Company continues to prioritize development of its data center energy orchestration platform, which remains its core strategic focus
and is expected to serve as the foundation for future revenue generation.

GridAI is a wholly owned subsidiary of GridAI
Technologies, Inc.

Legacy Technologies

Prior to GridAI’s acquisition of AMP X UK
Holdings (“AMP X”) in February 2025, AMP X had developed and operated two principal technology platforms focused on residential
and distributed energy management: DLS developed technology and ALICE Home Energy Management Systems (HEMS). While the Company currently
supports these technologies, there is very minimal revenue and the Company’s current focus is on data centers. DLS (Dynamic Load
Shaping) is the Company’s front-of-meter optimization platform designed to manage and optimize large-scale distributed energy resources,
such as utility-scale battery energy storage systems and solar arrays, by determining when to charge, hold, or discharge energy based
on market and grid conditions.

ALICE is the Company’s home energy management
system (HEMS) platform, which enables residential users to optimize energy usage across devices such as batteries, solar systems, and
household appliances through data-driven orchestration.

While historical deployments and trial activity,
including in Australia, have not yet resulted in significant commercial revenue, management believes these efforts have provided valuable
operational insight and market feedback that inform the Company’s current strategy. The Company is actively evaluating lower-friction,
near-term commercial opportunities related to these technologies, which may be pursued on a limited, low-cost basis as part of its broader
development efforts.

Management has not assumed that all previously contemplated pipeline
opportunities related to these legacy platforms will be realized; however, based on current market dynamics and increasing demand for
energy optimization solutions, management believes it is reasonable that certain opportunities, including those that may be delayed, could
be achieved. Accordingly, management continues to monitor the commercial viability of these platforms and incorporate such assessments
into its broader strategic planning and impairment analyses.

Strategic Pivot and Operational Restructuring

Following its acquisition of Amp X, Grid AI assessed
the commercial viability of the above platform offerings, in particular the potential for ALICE. This assessment was informed through
discussions with potential customers, investors active in the sector (including venture capital and private equity firms), and executives
of adjacent companies and competitors, as well as feedback from trial deployments. Based on this outreach and market feedback, management
determined that, while customers recognized the technical capabilities of the platform, many were unwilling to replace existing deployed
systems that were viewed as sufficiently effective.The Company is currently re-evaluating these opportunities across different geographic
markets, including the United States, United Kingdom, and Australia, where market conditions, customer needs, and adoption dynamics may
differ from prior deployments.

Following the above assessment, management initiated a strategic pivot
in 2025:

| | · | Reduced headcount to lower cash burn |
| | · | Scaled back DLS and Alice to minimum support levels |
| | · | Focused on new technology in a fundamentally new market: energy orchestration
for hyperscale AI data center campuses |

This pivot represents a significant shift in both market focus and
technological architecture.

AI Data Center Developed Technology

Following GridAI’s acquisition of AMP X
in February 2025, Grid AI commenced development of a new technology platform focused on AI-optimized energy orchestration for large-scale
data center campuses.

The Company plans to generate revenue from its
AI data center platform through:

· Base platform fees for operational visibility
and orchestration
· Performance-based fees tied to power cost optimization

The platform is designed to deliver AI-optimized
infrastructure by integrating data center operations with advanced energy systems. Core functionality includes data integration across
site-level assets (including engines, battery systems, substations, and building systems), real-time monitoring through a centralized
“single pane of glass” dashboard, historical data access, and reporting capabilities.

The platform also incorporates a proprietary digital
twin model of each site, enabling simulation of energy usage, asset behavior, and grid interactions under various scenarios. This is supported
by forecasting models for load, generation, and market conditions, which inform optimization decisions.

Based on management’s experience to date,
including discussions with data center operators, energy infrastructure participants, and industry consultants, the Company has not identified
a direct competitor offering an equivalent fully integrated solution combining data center orchestration and energy optimization at scale;
however, the Company operates in a broader competitive landscape that includes partial or adjacent solutions.

In addition, the platform includes a co-optimization
engine that participates in energy markets (including day-ahead, real-time, and reserve markets, where applicable) while prioritizing
uninterrupted data center operations. An orchestration control layer ensures that energy assets operate in accordance with both market
commitments and the operational requirements of the data center.

Target customers include enterprise and government
entities operating large data center campuses.

Based on current projections:

· A majority of the Company’s projected 2026 revenues are expected to be derived from the AI data center technology.

· The contribution from this platform is expected to increase substantially in subsequent years.

The Company markets its legacy technologies and intends to pursue commercial
deployment of its AI data center platform through direct sales and strategic partnerships with energy developers, system integrators,
engineering firms, and other industry participants. The Company has commenced early-stage development activities related to its data center
orchestration platform in connection with a potential future deployment at a customer site. As of the date of this Current Report on Form 8-K,
the platform has not yet been commercially deployed. Initial development and integration activities are ongoing, and any future commercial
deployment will depend on the progress of customer projects, including construction and operational readiness milestones, as well as the
availability of customer funding.

Competition

The Company operates in a competitive and rapidly
evolving market that includes energy management software providers, virtual power plant (“VPP”) platforms, battery system
integrators, utilities, engineering firms, and in-house customer-developed solutions. The Company also competes with emerging technology
providers focused on distributed energy resource optimization and artificial intelligence-driven grid management.

Competition is driven by several factors, including
software functionality, scalability, interoperability with third-party hardware and market platforms, speed of deployment, regulatory
expertise, customer relationships, and pricing. The Company’s solutions must integrate with a wide range of third-party systems,
including batteries, control systems, and energy market infrastructure, which are often not standardized and may change over time.

The markets in which the Company operates are
highly competitive and include both established industry participants with significant financial, technical, and commercial resources,
as well as new entrants seeking to capitalize on the growth of distributed energy and AI-driven energy optimization. Some competitors
offer vertically integrated solutions, including hardware, software, and energy services, while others provide point solutions that compete
with specific components of the Company’s platform.

The Company’s ability to compete successfully
depends on its ability to continue to innovate, expand its platform capabilities, maintain reliable system performance, and effectively
execute its go-to-market strategy. The Company also competes based on its ability to convert pilot programs and non-binding arrangements
into long-term commercial contracts, scale deployments across multiple jurisdictions, and adapt to evolving regulatory frameworks and
market rules.

In addition, customers may elect to develop in-house
energy management systems or partner with alternative providers, which may reduce demand for the Company’s solutions. As a result,
the Company may face pricing pressure, longer sales cycles, and increased customer acquisition costs. If the Company is unable to compete
effectively, it may lose market share, which could adversely affect its business, operating results, and financial condition.

Sources and Availability of Raw Materials

The Company’s business is primarily software-based
and does not rely on raw materials. Customer deployments may depend on third-party equipment and services, including battery systems,
generation assets, and grid infrastructure.

Dependence on Major Customers

The Company is in an early stage of commercialization
and expects that a limited number of customers may account for a significant portion of revenue in the near term. Amp Z is a current customer
with whom the Company has been engaged in ongoing collaboration since October 1, 2025; however, as of the date of this report, the
parties remain under a letter of intent and have not yet finalized a definitive commercial agreement. The Company has not generated material
revenue from Amp Z to date. Accordingly, the Company does not have any major customers at the present time.

Patents, Trademarks, and Agreements

The Company relies on proprietary software, trade
secrets, trademarks, and contractual protections. The Company does not currently rely on material labor agreements.

Government Approvals

The Company’s software platform itself generally
does not require direct government approvals to operate. However, the Company’s solutions are deployed within regulated energy markets
and are therefore indirectly subject to a range of federal, state, and local regulatory requirements.

Customer deployments may require regulatory approvals,
permits, interconnection agreements, and market participation approvals, which are typically obtained by customers, utilities, or project
partners. These approvals may relate to grid interconnection, participation in wholesale electricity markets, local permitting, and compliance
with applicable energy regulations.

The Company’s platform is designed to operate
within complex and evolving regulatory frameworks, including those governing distributed energy resources, virtual power plants, and wholesale
market participation. Changes in laws, regulations, market rules, or regulatory interpretations could impact the ability of customers
to deploy the Company’s solutions, participate in energy markets, or realize the expected economic benefits of the platform.

In addition, the Company relies on integrations
with third-party systems and market operators, including utilities, grid operators, and energy market platforms, which are themselves
subject to regulatory oversight. Delays in obtaining required approvals, changes in regulatory requirements, or limitations imposed by
regulators or market operators could adversely affect the Company’s business, operating results, and financial condition.

Effect of Government Regulation

The Company operates in regulated energy markets.
Regulatory changes affecting energy storage, distributed energy resources, interconnection, or energy markets could impact the Company’s
business.

Environmental Compliance

The Company’s operations are primarily software-based
and are not expected to incur material environmental compliance costs. Customer projects may be subject to environmental regulations that
could affect project timing.

Employees

As of April 13, 2026, the Company had 18
full-time employees.

Risks Related to Our Business and Industry

Our limited operating history
makes evaluating our business and prospects difficult.

Prior to GridAI’s acquisition of AMP X UK
Holdings (“AMP X”) in February 2025, AMP X had developed and operated two principal technology platforms focused on residential
and distributed energy management: DLS developed technology and ALICE Home Energy Management Systems (HEMS). While the Company currently
supports these technologies, there is very minimal revenue and the Company’s current focus is on data centers. While
we are looking to develop a data center platform, we have a limited history operating our business at its current scale and under our
current strategy, and therefore a limited history upon which you can base an investment decision.

Further, the company’s ability to execute
its business plan depends on successfully completing customer deployments, integrating with third-party hardware and software systems,
and scaling its platform and personnel. Delays in implementation, customer adoption, or integration with external systems could adversely
affect operating results. Our operating results may fluctuate significantly, which could make our future results difficult to predict
and could cause our operating results to fall below expectations.

The distributed generation
industry is emerging and our distributed generation offerings may not receive widespread market acceptance.

The implementation and use of
distributed generation at scale is still not widespread, and we cannot be sure that any potential customers will accept our services and
solutions broadly. Enterprises may be unwilling to adopt our offerings over traditional or competing power sources for any number of reasons,
including the perception that our technology is unproven, lack of confidence in our business model, unavailability of back-up service
providers to operate and maintain the energy storage systems, and lack of awareness of our related products and services. Because this
is an emerging industry, broad acceptance of our products and services is subject to a high level of uncertainty and risk. If the market
develops more slowly than we anticipate, our business may be adversely affected.

If renewable energy technologies
are not suitable for widespread adoption, or if sufficient demand for our software-enabled services does not develop or takes longer to
develop than we anticipate, we may not be able to generate sufficient revenue or revenue at all to be financially successful.

The market for renewable, distributed energy generation
is emerging and rapidly evolving, and its future success is uncertain. If renewable energy generation proves unsuitable for widespread
commercial deployment or if demand for our renewable energy products and services fails to develop sufficiently, our revenue, market share
and profitability would be adversely impacted.

Many factors may influence the widespread adoption
of renewable energy generation and demand for our products and services, including, but not limited to the cost-effectiveness of renewable
energy technologies as compared with conventional and competitive technologies, the performance and reliability of renewable energy products
as compared with conventional and non-renewable products, fluctuations in economic and market conditions that impact the viability of
conventional and competitive alternative energy sources, increases or decreases in the prices of oil, coal and natural gas, continued
deregulation of the electric power industry and broader energy industry, and the availability or effectiveness of government subsidies
and incentives. You should consider our prospects in light of the risks and uncertainties emerging companies encounter when introducing
new products and services into a nascent industry.

Our market estimates and
assumptions may prove inaccurate.

While we anticipate being able to generate revenue
and garnering customers, market estimates and growth forecasts are subject to significant uncertainty and are based on assumptions and
estimates that may prove to be inaccurate. Even if the markets in which we compete meet our size estimates and forecasted growth, our
business could fail to grow at similar rates, if at all. The assumptions relating to our market opportunities include, but are not limited
to (i) general declines in the cost of renewable energy generation assets; (ii) growing deployment of renewable energy assets
and energy storage systems; and (iii) continued complexity of the electrical grid and resulting demand for stability and resiliency.
Our expected market opportunities are also based on the assumption that our existing and future offerings will be more attractive to our
customers and potential customers than competing products and services. If these assumptions prove inaccurate, our business, financial
condition and results of operations could be adversely affected.

We expect to face significant competition
in our industry.

We expect to face significant competition in our
industry and market. The Company operates in a competitive and rapidly evolving market that includes energy management software providers,
virtual power plant (“VPP”) platforms, battery system integrators, utilities, engineering firms, and in-house customer-developed
solutions. The Company also competes with emerging technology providers focused on distributed energy resource optimization and artificial
intelligence-driven grid management.

Competition is driven by several factors, including
software functionality, scalability, interoperability with third-party hardware and market platforms, speed of deployment, regulatory
expertise, customer relationships, and pricing. The Company’s solutions must integrate with a wide range of third-party systems,
including batteries, control systems, and energy market infrastructure, which are often not standardized and may change over time.

The markets in which the Company operates are
highly competitive and include both established industry participants with significant financial, technical, and commercial resources,
as well as new entrants seeking to capitalize on the growth of distributed energy and AI-driven energy optimization. Some competitors
offer vertically integrated solutions, including hardware, software, and energy services, while others provide point solutions that compete
with specific components of the Company’s platform.

The Company’s ability to compete successfully
depends on its ability to continue to innovate, expand its platform capabilities, maintain reliable system performance, and effectively
execute its go-to-market strategy. The Company also competes based on its ability to convert pilot programs and non-binding arrangements
into long-term commercial contracts, scale deployments across multiple jurisdictions, and adapt to evolving regulatory frameworks and
market rules.

We cannot assure that we will be able to compete
successfully with other players in the market. In such event, our business may be negatively impacted.

We plan to use artificial intelligence in
our business, and challenges with properly managing its use could result in harm to our brand, reputation, business or customers, and
adversely affect our results of operations.

We plan to use AI-enabled software and services
offerings and incorporating AI in internal tools that support our business. This emerging technology presents a number of risks inherent
in its use. AI algorithms are based on machine learning and predictive analytics, which can create accuracy issues, unintended biases,
and discriminatory outcomes that could harm our brand, reputation, business, or customers. Additionally, no assurance can be made that
the usage of AI will assist us in being more efficient or offset the costs of its implementation. Further, dependence on AI to make certain
business decisions may introduce additional operational vulnerabilities by producing inaccurate outcomes, recommendations, or other suggestions
based on flaws in the underlying data or other unintended results. Our competitors or other third parties may incorporate AI into their
business, services, and products more rapidly or more successfully than us, which could hinder our ability to compete effectively and
adversely affect our results of operations. Implementing the use of AI successfully, ethically and as intended, will require significant
resources. In addition, the use of AI may increase regulatory, cybersecurity, and data privacy risks, such as intended, unintended, or
inadvertent transmission of proprietary or sensitive information. The technologies underlying AI and their use cases are rapidly developing,
and it is not possible to predict all of the legal, operational or technological risks related to the use of AI. Our obligation to comply
with emerging AI initiatives, laws, and regulations, including under proposed or enacted legislation regulating AI in jurisdictions such
as the U.S. and European Union, could entail significant costs, negatively affect our business, or limit our ability to incorporate certain
AI capabilities into our business.

Our future growth will depend on developing
and commercializing our AI data center platform.

Following GridAI’s acquisition of AMP X
in February 2025, Grid AI commenced development of a new technology platform focused on AI-optimized energy orchestration for large-scale
data center campuses. However, as of today, this platform is still in an early stage of commercialization and has not been deployed. We
cannot assure that this platform will ever be successfully deployed. In such event, our business may be unable to achieve anticipated
financial growth.

Furthermore, we may also introduce new technologies
or products that do not work in the future, are not delivered on a timely basis, are not developed according to product and/or cost specifications,
or are not well received by customers. There may be fewer opportunities than we expect due to a decline in business or economic conditions
or a decreased demand in these markets or for our new products from our expectations, our inability to successfully execute our sales
and marketing plans, or for other reasons. In addition to our current growth opportunities, our future growth may be reliant on our ability
to identify and develop potential new growth opportunities. This process is inherently risky and may result in investments in time and
resources for which we do not achieve any return or value. These risks are enhanced by attempting to introduce multiple breakthrough technologies
and products simultaneously.

Our growth opportunities and those opportunities
we may pursue are subject to rapidly changing and evolving technologies and industry standards, and may be replaced by new technology
concepts or platforms. If we do not develop innovative and reliable product offerings and enhancements in a cost-effective and timely
manner that are attractive to customers in these markets; if we are otherwise unsuccessful in competing in these new product categories;
if the new product categories in which we invest our limited resources do not emerge as expected or do not produce the growth or profitability
we expect, or when we expect it, or if we do not correctly anticipate changes and evolutions in technology and platforms, our business
and results of operations may be adversely affected.

Risks Relating to Our Operations

Our business strategy may not achieve anticipated benefits. Our
failure to do so could adversely affect our business, financial condition, and results of operations.

The Company plans to generate revenue from its AI data center platform through base platform fees for operational visibility and orchestration
and performance-based fees tied to power cost optimization. Target customers include enterprise and government entities operating large
data center campuses.

The Company has initiated development of its data center orchestration platform in connection with a potential future deployment at a
customer site. Initial development and integration activities are underway. As of the date of this report, the platform has not yet been
commercially deployed.

Any future commercial deployment is expected to occur as customer projects progress through construction and operational readiness milestones.
The timing and extent of such deployment will depend on a number of factors, including project development timelines and the availability
of customer funding. There can be no assurance that the platform will be successfully commercialized. Customer acceptance of our software
and service offerings is critical to our future success. We cannot assure that customers will be attracted to our platform and software
solutions. If market demand for the types of AI-driven energy software and services we are developing and will seek to develop in the
future does not grow as anticipated, or if competitors offer more attractive products, our revenue growth and market position could be
adversely affected. As with all software offerings, there is also a risk that our solutions could be vulnerable to cybersecurity threats
or contain errors, bugs, or other issues affecting their functionality, which could negatively affect customer satisfaction and adoption.

In addition, continuing to execute on the new
strategy requires investment in new capabilities and resources, particularly in software development, data management, and AI. We may
face challenges in recruiting, retaining, and training employees who have the necessary skill sets to support our new business model.
A failure to build or acquire these capabilities in a timely manner could delay the successful execution of the strategy and weaken our
competitive position.

We currently have no major customers.

We have no major customers. Even if we acquire
customers in the future, the loss of any one of our significant customers, their inability to perform under their contracts, their termination
or failure to renew their contracts with us, or their default in payment could cause our revenue and our working capital to decline materially.
We cannot assure that we will be successful in acquiring or retaining customers in the future. In such event, we may be unable to generate
revenue, and our business, results of operations and financial condition could be materially and adversely affected.

If we are unable to attract and retain key
employees and hire qualified management, technical, engineering and sales personnel, our ability to compete and successfully grow our
business could be adversely affected.

We believe that our success and our ability to
reach our strategic objectives are highly dependent on the contributions of our key management, technical, engineering, and finance personnel.
Key leaders include Marshall Chapin, Mike Krastev and Vaclav Moulis. Executive leadership and senior management transitions, reductions
in workforce and employee turnover can be time-consuming, difficult to manage, create instability, cause disruption to our business and
result in the loss of institutional knowledge. Any of these outcomes could impede the execution of our day-to-day operations and our ability
to fully implement our business strategy. These effects could also make it more difficult to attract and retain talent. The failure to
successfully hire and retain key executives and employees or the further loss of any key executives, senior management or employees could
have a significant impact on our operations, including declining product identity and competitive differentiation, eroding employee morale
and productivity or an inability to maintain internal controls, regulatory or other compliance related requirements, any and all of which
could in turn adversely impact our business, financial condition, and results of operations.

In addition, our ability to manage our growth
effectively, including our ability to expand our market presence, is impacted by our ability to successfully retain our management team,
and hire and train new personnel. Our success in hiring, attracting and retaining senior management and other experienced and highly skilled
employees will depend in part on our ability to provide competitive compensation packages and a high-quality work environment and maintain
a desirable corporate culture. To help attract, retain, and motivate qualified employees, we use stock-based awards, such as restricted
stock units and performance-based cash incentive awards, and in the case of our executive officers, we also use performance stock units.
Further sustained declines in our stock price, or lower stock price performance relative to our competitors, can further reduce the retention
value of our stock-based awards. We may not be able to attract, integrate, train, motivate or retain current or additional highly qualified
personnel, and our failure to do so could adversely affect our business, financial condition and operating results.

Furthermore, there is continued and increasing
competition for talented individuals in our field. In addition to longstanding competition for highly skilled and technical personnel,
we face increased competitive pressures and employee cost inflation in tighter labor markets. Industry competition and cross-industry
labor market pressures may negatively affect our ability to attract and retain our executive officers and other key technology, sales,
marketing and support personnel and drive increases in our employee costs, both of which could adversely affect our business, financial
condition and results of operations.

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

Our customers depend on our support organization
to resolve any technical issues relating to our hardware and software-enabled services. In addition, our sales process is highly dependent
on the quality of our software and service offerings, on our business reputation and on strong recommendations from our existing customers.
Any failure to maintain high-quality and highly-responsive technical support, or a market perception that we do not maintain high-quality
and highly-responsive support, could adversely affect our reputation, our ability to sell our products to existing and prospective customers,
and our business, financial condition and results of operations.

We offer technical support
services with our software and service offerings and may be unable to respond quickly enough to accommodate short-term increases in demand
for support services, particularly as we increase the size of our customer base. We also may be unable to modify the format of our support
services to compete with changes in support services provided by competitors. It is difficult to predict demand for technical support
services and if demand increases significantly, we may be unable to provide satisfactory support services to our customers. Additionally,
increased demand for these services, without corresponding revenue, could increase costs and adversely affect our business, financial
condition and results of operations.

Severe weather events, including the effects
of climate change, are inherently unpredictable and may have a material adverse effect on our financial results and financial condition.

Our business, including our customers and suppliers,
may be exposed to severe weather events and natural disasters, such as tornadoes, tsunamis, tropical storms (including hurricanes), earthquakes,
windstorms, hailstorms, severe thunderstorms, flooding, wildfires and other fires, extreme heatwaves, drought and power shut-offs causing,
among other things, disruptions to our supply chain or utility interconnections and/or damage to energy storage systems installed at our
customers’ sites. Such damage or disruptions may prevent us from being able to satisfy our contractual obligations or may reduce
demand from our customers for our energy storage systems causing our operating results to vary significantly from one period to the next.
We may incur losses in our business in excess of: (1) those experienced in prior years, (2) the average expected level used
in pricing, or (3) current insurance coverage limits.

The incidence and severity of severe weather conditions
and other natural disasters are inherently unpredictable. Climate change is projected to affect the occurrence of certain natural events,
such as an increase in the frequency or severity of wind and thunderstorm events, and tornado or hailstorm events due to increased convection
in the atmosphere; more frequent wildfires and subsequent landslides in certain geographies; higher incidence of deluge flooding; and
the potential for an increase in severity of the hurricane events due to higher sea surface temperatures. Changing market dynamics, global
policy developments and the increasing frequency and impact of extreme weather events on critical infrastructure in the U.S. and elsewhere
as a result of climate change have the potential to disrupt our business, the business of our suppliers and the business of our customers,
and may cause us to experience higher attrition, losses and additional costs to maintain or resume operations. Additionally, climate change
and the occurrence of severe weather events may adversely impact the demand, price, and availability of insurance. Due to significant
variability associated with future changing climate conditions, we are unable to predict the impact climate change will have on our business.

Increased scrutiny from stakeholders and
regulators regarding sustainability practices and disclosures, including those related to sustainability, and disclosure could result
in additional costs and adversely impact our business and reputation.

Companies across all industries are facing increased
scrutiny regarding their sustainability practices and disclosures and some institutional and individual investors are using sustainability
screening criteria in making investment decisions. Our disclosures on these matters or a failure to satisfy evolving stakeholder expectations
for sustainability practices and reporting, which may conflict with one another, may potentially harm our reputation and impact employee
retention, customer relationships and access to capital. For example, certain market participants use third-party benchmarks or scores
to measure a company’s sustainability practices in making investment decisions and customers and supplies may evaluate our sustainability
practices or require that we adopt certain sustainability policies as a condition of awarding contracts. In addition, our failure or perceived
failure to pursue or fulfill our goals, targets and objectives or to satisfy various reporting standards within the timelines we announce,
or at all, could expose us to government enforcement actions and private litigation. Furthermore, complying or failing to comply with
existing or future federal, state, local, and foreign legislation and regulations applicable to our sustainability efforts, which may
conflict with one another, could cause us to incur additional compliance and operational costs, suffer reputational harm or to become
the target of litigation, investigations or other proceedings initiated by government authorities or private actors, which could materially
and adversely affect our business, financial condition and results of operations.

Our ability to achieve any goal or objective,
including with respect to environmental and diversity initiatives and compliance with sustainability reporting standards, is subject to
numerous risks, many of which are outside of our control. Examples of such risks include the availability and cost of technologies and
products that meet sustainability and ethical supply chain standards, evolving regulatory requirements affecting sustainability standards
or disclosures, our ability to recruit, develop and retain diverse talent in our labor markets, and our ability to develop reporting processes
and controls that comply with evolving standards for identifying, measuring and reporting sustainability metrics. Methodologies for reporting
sustainability data may be updated and previously reported sustainability data may be adjusted to reflect improvement in availability
and quality of third-party data, changes in assumptions, changes in the nature and scope of our operations and other changes in circumstances.
Our processes and controls for reporting sustainability matters across our operations and supply chain are evolving along with multiple
disparate standards for identifying, measuring, and reporting sustainability metrics, including sustainability-related disclosures that
may be required by the SEC, European and other regulators, and such standards may change over time, which could result in significant
revisions to our current goals, reported progress in achieving such goals, or ability to achieve such goals in the future. As sustainability
best-practices, reporting standards and disclosure requirements continue to develop, we may incur increasing costs related to sustainability
monitoring and reporting.

A failure of our information technology
(“IT”) and data security infrastructure could adversely affect our business and operations.

The efficient operation of our business depends
on our IT systems. We rely upon the capacity, reliability and security of our IT and data security infrastructure and our ability to effectively
manage our business data, accounting, financial, legal and compliance functions, communications, supply chain, order entry and fulfillment,
and expand and routinely update this infrastructure in response to the changing needs of our business. Our existing IT systems and any
new IT systems we utilize may not perform as expected. If we experience a problem with the functioning of an important IT system or a
security breach of our IT systems, including during system upgrades or new system implementations, the resulting disruptions could adversely
affect our business.

Despite our implementation of reasonable security
measures, our IT systems, like those of other companies, are vulnerable to damages from computer viruses, natural disasters, fire, power
loss, telecommunications failures, personnel misconduct, human error, unauthorized access, physical or electronic security breaches, cyber-attacks
(including malicious and destructive code, phishing attacks, ransomware, and denial of service attacks), and other similar disruptions.
Such attacks or security breaches may be perpetrated by bad actors internally or externally (including computer hackers, persons involved
with organized crime, or foreign state or foreign state-supported actors). Cybersecurity threat actors employ a wide variety of methods
and techniques that are constantly evolving, increasingly sophisticated, and difficult to detect and successfully defend against. Moreover,
we may not have the current capability to detect certain vulnerabilities, which may allow those vulnerabilities to persist in our systems
over long periods of time. Additionally, it may take considerable time for us to investigate and evaluate the full impact of incidents,
particularly for sophisticated attacks. These factors may inhibit our ability to provide prompt, full and reliable information about the
incident to our customers, partners, regulators, and the public. Geopolitical tensions or conflicts, such as Russia’s invasion of
Ukraine, may further heighten the risk of cyber-attacks. The emergence and maturation of AI capabilities may also lead to new and/or more
sophisticated methods of attack, including fraud that relies upon “deep fake” impersonation technology or other forms of generative
automation that may scale up the efficiency or effectiveness of cyber-attacks. We have experienced such incidents in the past, and any
future incidents could expose us to claims, litigation, regulatory or other governmental investigations, administrative fines and potential
liability. Any system failure, accident or security breach could result in disruptions to our operations. A material network breach in
the security of our or our service providers’ IT systems could include the theft of our trade secrets, customer information, human
resources information or other confidential data, including but not limited to personally identifiable information. Although past incidents
have not had a material adverse effect on our business operations or financial performance, to the extent that any disruptions or security
breach results in a loss or damage to our data, or an inappropriate disclosure of confidential, proprietary or customer information, it
could cause significant damage to our reputation, affect our relationships with our customers and strategic partners, lead to claims against
us from governments and private plaintiffs, and otherwise adversely affect our business. We cannot guarantee that future cyberattacks,
if successful, will not have a material effect on our business or financial results.

Many governments have enacted laws requiring companies
to provide notice of cyber incidents involving certain types of data, including personal data. If an actual or perceived cybersecurity
breach of security measures, unauthorized access to our system or the systems of the third-party vendors that we rely upon, or any other
cybersecurity threat occurs, we may incur liability, costs, or damages, contract termination, our reputation may be compromised, our ability
to attract new customers could be negatively affected, and our business, financial condition, and results of operations could be materially
and adversely affected. Any compromise of our security could also result in a violation of applicable domestic and foreign security, privacy
or data protection, consumer and other laws, regulatory or other governmental investigations, enforcement actions, and legal and financial
exposure, including potential contractual liability. In addition, we may be required to incur significant costs to protect against and
remediate damage caused by these disruptions or security breaches in the future. Further, our contracts may not fully protect us from
liabilities, damages, or claims and, although we carry cyber insurance, we cannot be certain that our coverage will be adequate for liabilities
actually incurred, that insurance will continue to be available to us on commercially reasonable terms, or at all, or that any insurer
will not deny coverage as to any future claim. In addition, any data breach, security incident, or compromise of protected personal information
may also result in notification requirements or other disclosure obligations and may subject us to civil fines and penalties, litigation,
regulatory investigations or enforcement actions or claims for damages under applicable privacy laws.

Our failure to adequately secure, protect
and enforce our intellectual property rights may undermine our competitive position, and litigation to protect our intellectual property
rights may be costly.

The Company’s intellectual property is primarily
software-based and may be inherently difficult to protect, as patents and formal protections in this area can be limited and enforcement
may be uncertain. The Company relies in part on trade secrets, proprietary know-how, and contractual protections, which may be vulnerable
to unauthorized use, employee misappropriation, or other forms of intellectual property theft. In addition, litigation to enforce intellectual
property rights is often complex, time-consuming, and costly, and there can be no assurance that the Company will be successful in protecting
its intellectual property.

Monitoring unauthorized use of
proprietary technology can be difficult and expensive. For example, many of our software developers reside in California and we cannot
legally prevent them from working for a competitor.

Also, litigation may be necessary
to enforce our intellectual property rights, protect our trade secrets, or determine the validity and scope of the proprietary rights
of others. Such litigation may result in our intellectual property rights being challenged, limited in scope or declared invalid or unenforceable.
We cannot be certain that the outcome of any litigation will be in our favor, and an adverse determination in any such litigation could
impair our intellectual property rights and may adversely affect our business, prospects and reputation.

We rely primarily
on patent, trade secret and trademark laws, and non-disclosure, confidentiality, and other types of contractual restrictions to establish,
maintain, and enforce our intellectual property and proprietary rights. However, our rights under these laws and agreements afford
us only limited protection and the actions we take to establish, maintain, and enforce our intellectual property rights may not be adequate.
For example, our trade secrets and other confidential information could be disclosed in an unauthorized manner to third parties, our owned
or licensed intellectual property rights could be challenged, invalidated, circumvented, infringed, or misappropriated or our intellectual
property rights may not be sufficient to provide us with a competitive advantage, any of which could have a material adverse effect on
our business, financial condition and results of operations. Additionally, we rely on our brand names, trade names and trademarks to distinguish
our products and services. In the event that our trademarks are successfully challenged and we lose rights to use those trademarks, we
could be forced to rebrand our products and services, which could result in the loss of goodwill and brand recognition. In addition, the
laws of some countries do not protect proprietary rights as fully as do the laws of the U.S. As a result, we may not be able to protect
our proprietary rights adequately abroad.

We may face claims that our use
of such technology or components infringes or otherwise violates the rights of others, which would subject us to the risks described above.
We may seek indemnification from our licensors or suppliers under our contracts with them, but our rights to indemnification or our suppliers’
resources may be unavailable or insufficient to cover our costs and losses.

Regulatory Risks

Negative attitudes toward renewable energy
projects from the U.S. government, other lawmakers and regulators, and activists could adversely affect our business, financial condition
and results of operations.

Parties with an interest in other energy sources,
including lawmakers, regulators, policymakers, environmental and advocacy organizations or other activists may invest significant time
and money in efforts to delay, repeal or otherwise negatively influence laws, regulations and programs that promote renewable energy.
Many of these parties have substantially greater resources and influence than we have. Further, changes in U.S. federal, state or local
political, social or economic conditions, including changes in U.S. Presidential administrations or deprioritization of these laws, programs
and regulations, could result in their modification, delayed adoption or repeal. Any failure to adopt, delay in implementing, expiration,
repeal or modification of these programs and regulations, or the adoption of any programs or regulations that encourage the use of other
energy sources over renewable energy, could adversely affect our business, financial condition and results of operations.

The installation and operation of our energy
storage systems are subject to environmental laws and regulations in various jurisdictions, and there is uncertainty with respect to the
interpretation of certain environmental laws and regulations to our energy storage systems, especially as these regulations evolve over
time.

We are subject to national, state and local environmental
laws and regulations, as well as environmental laws in those foreign jurisdictions in which we operate. Environmental laws and regulations
can be complex and are evolving. These laws can give rise to liability for administrative oversight costs, cleanup costs, property damage,
bodily injury, fines and penalties. We are committed to compliance with applicable environmental laws and regulations, including health
and safety standards, and we routinely review the operation of our energy storage systems for health, safety and compliance. Our energy
storage systems, like other battery technology-based products of which we are aware, produce small amounts of hazardous wastes and air
pollutants, and we seek to handle these materials in accordance with applicable regulatory standards.

Maintaining compliance with laws and regulations
can be challenging given the changing patchwork of environmental laws and regulations that prevail at the U.S. federal, state, regional
and local levels and in foreign countries in which we operate. Most existing environmental laws and regulations preceded the introduction
of battery technology and were adopted to apply to technologies existing at the time, namely large, coal, oil or gas-fired power plants.
Currently, there is generally little guidance from these agencies on how certain environmental laws and regulations may, or may not, be
applied to our technology.

In many instances, our technology is moving faster
than the development of applicable regulatory frameworks. It is possible that regulators could delay or prevent us from conducting our
business in some way pending agreement on, and compliance with, shifting regulatory requirements. Such actions could delay the sale to
and installation by customers of energy storage systems, require their modification or replacement, result in fines, or trigger claims
of performance warranties and defaults under customer contracts that could require us to refund hardware or service contract payments,
any of which could adversely affect our business, financial performance and reputation.

Changes in the U.S. trade environment, including
the imposition of import tariffs, could adversely affect the amount or timing of our revenues, results of operations or cash flows.

The United States has imposed significant new
tariffs on nearly all products and components imported into the United States and could propose additional tariffs or increases to those
already in place. Escalating trade tensions, particularly between the United States and China, have led to increased tariffs and trade
restrictions, including tariffs applicable to certain materials and components for products used in storage or solar energy projects and
the renewable energy market more broadly, such as module supply and availability. More specifically, in March 2018, the United States
imposed a 25% tariff on steel imports and a 10% tariff on aluminum imports pursuant to Section 232 of the Trade Expansion Act of
1962 and has imposed additional tariffs on steel and aluminum imports pursuant to Section 301 of the Trade Act of 1974. In February 2025,
the United States expanded the Section 232 tariffs on steel and aluminum, raising them to 25% on both metals and eliminating previously
available country-level and importer-specific exclusions and exemptions. In June 2025, Section 232 tariffs on steel and aluminum
were further increased to 50%, and the scope was broadened to cover the steel and aluminum content of a wider range of derivative products.
To the extent we source products that contain overseas supplies of steel and aluminum, these tariffs and any additional or increased tariffs
could result in interruptions in the supply chain and negatively affect costs and our gross margins.

Additionally, in January 2018, the United
States adopted a tariff on imported solar modules and cells pursuant to Section 201 of the Trade Act of 1974. The tariff was initially
set at 30%, with a gradual reduction over four years to 15%. In 2022, the United States extended the Section 201 solar tariffs for
an additional four years, which declined to a rate of 14% in 2025. The Section 201 solar tariffs expired on February 7, 2026.
While this tariff did not apply directly to the components we import, it may have indirectly affected us by affecting the financial viability
of solar energy projects, which could in turn reduce demand for our products. Furthermore, in July 2018, the United States adopted
a 10% tariff on a long list of products imported from China under Section 301 of the Trade Act of 1974, including, inverters and
power optimizers, which became effective on September 24, 2018 and has been increased several times since then. In June 2019,
the Office of the U.S. Trade Representative increased the rate of such tariffs from 10% to 25%. In September 2024, Section 301
tariffs on Chinese solar cells and modules were increased from 25% to 50%, and in January 2025, new 50% Section 301 tariffs
took effect on Chinese polysilicon and solar wafers. The Section 301 tariff on lithium-ion non-electric vehicle batteries from China,
including those used in energy storage systems, increased from 7.5% to 25% effective January 1, 2026. While these tariffs are not
directly applicable to our products, they could negatively affect the solar energy projects in which our products are used, which could
lead to decreased demand for our products. In 2025, the United States broadly imposed additional 10% tariffs on Chinese goods under the
International Emergency Economic Powers Act of 1977.

In addition, the United States currently imposes
antidumping and countervailing duties on certain imported crystalline silicon photovoltaic (“PV”) cells and modules from China
and Taiwan. Such antidumping and countervailing duties can change

over time pursuant to annual reviews conducted
by the U.S. Department of Commerce (“USDOC”), and an increase in duty rates could have an adverse impact on our operating
results.

In February 2022, Auxin Solar Inc., a U.S.
producer of crystalline silicon PV products, petitioned the USDOC to investigate alleged circumvention of antidumping and countervailing
duties on crystalline silicon PV cell and module imports assembled and completed in Cambodia, Malaysia, Thailand, and Vietnam. In August 2023,
USDOC issued a final determination that certain Chinese producers are circumventing antidumping and countervailing duties by shipping
crystalline silicon PV cells and modules through Cambodia, Malaysia, Thailand, and Vietnam for minor processing. However, that two-year
moratorium has since expired. In 2024, USDOC initiated a second solar antidumping and countervailing duties case involving these same
four countries, and final antidumping and countervailing duties orders were issued in June 2025. Also in 2025, the United States
also initiated an antidumping and countervailing duties case for Chinese anode material, which could affect battery prices, and USDOC
initiated antidumping and countervailing duties investigations into imports of solar cell and modules from India, Indonesia, and
Laos. The timing and progress of many of our customers’ projects depend upon the supply of batteries, PV cells and modules. As a
result, the imposition and collection of antidumping and countervailing duties, the expanded scope of antidumping and countervailing duties
investigations to additional countries and battery materials, and the stacking of multiple tariff authorities on such products, it could
adversely affect our business, financial condition and results of operations.

Tariffs, and the possibility of additional or
increased tariffs in the future, have created uncertainty in the industry, particularly in light of the recent change in U.S. Presidential
administration. This has resulted in, and may continue to result in, some project delays. If the price of solar systems or energy storage
systems in the United States increases, the use of these products could become less economically feasible and could reduce our gross margins
or reduce the demand of such systems manufactured and sold, which in turn may decrease demand for our products. Additionally, existing
or future tariffs may negatively affect key customers, suppliers, and manufacturing partners. Such outcomes could adversely affect the
amount or timing of our revenues, results of operations or cash flows, and continuing uncertainty could cause sales volatility, price
fluctuations or supply shortages, or cause our customers to advance or delay their purchase of our products. It is difficult to predict
what further trade-related actions governments may take, which may include additional or increased tariffs and trade restrictions, and
we may be unable to quickly and effectively react to such actions.