Triunity Business Services Ltd - 10-K

ITEM 1A. RISK FACTORS

The risk factors set forth below are those the Company currently considers material with respect to its operations, prospects, and capital structure. They are not comprehensive, and there may be additional risks, uncertainties, and events that the Company does not currently anticipate or consider material.

An investment in our Class A Common Stock is highly speculative and involves an extremely high risk of loss. The Company has limited liquidity, minimal operating history, and significant uncertainties regarding its future operations and financial performance. As a result, an investment in our Class A Common Stock could result in the complete loss of an investor’s entire investment. Prospective investors should be prepared to bear the economic risk of such a loss. Only persons who can afford to lose their entire investment should consider investing in the Company. There can be no assurance that any investment in the Company will produce a return, and the risk of total loss is substantial.

Risk Factors Summary

The following summary of risk factors should be carefully considered. These are not the only risks we face. Additional risks that are unknown or currently considered less significant may also affect our business or financial results. If any of these risks occur, our business, financial condition, results of operations, or stock price could be materially and adversely affected. For further details, please see the full discussion of risk factors below.

We are an early-stage company with an unproven business strategy and may never be able to fully implement our business plan or achieve profitability;

Our limited operating history makes it difficult to forecast revenues and plan operating expenses accurately;

We recognized a substantial amount of revenue on the GridCore Installation Project, most of it in the form of the GridCore Note, but we expect our revenues in the future to be primarily related to servicing BESS, and there can be no assurance that we will be able to enter into similar installation contracts in the future;

We expect to generate revenue in the future primarily related to servicing BESS and we have only one active servicing contract;

We may not receive payments under the GridCore Note;

We may not be able to fully realize the value of the collateral securing the GridCore Note;

We are a holding company with no operations and will depend on distributions from our operating subsidiary to provide us with the funds necessary to meet our financial obligations;

We will require additional funds in the future to achieve our current business strategy, and our inability to obtain funding may cause our business to fail;

Technical issues with the Software Platform could disrupt our operations;

Our energy storage products and solutions, which are complex, could contain defects, or may not operate at expected performance levels, which may cause us to incur warranty expenses beyond current estimates and could adversely affect our business and results of operations;

Our customer relationships, business, financial results, and reputation may be adversely impacted due to events and incidents relating to storage, delivery, installation, operation, maintenance, and shutdowns of our energy storage solutions;

Substantially all of Independence Power’s revenue to date was derived in the three months ended September 30, 2025 pursuant to a single contract related to the installation of a battery software management system for the GridCore Installation Basin Project, and there can be no assurance that we will be successful in winning new customers for similar installation projects in the future;

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Our ability to generate service revenue is dependent on our ability to establish and maintain a customer base that will generate a recurring stream of revenues. If that recurring stream of revenues does not increase as expected, our operating results will be adversely affected;

We operate in a highly competitive industry, and our inability to compete effectively could materially affect our business;

Our business and customer demand for our offerings depends in large part on government incentives and/or regulations relating to the use of renewable energy and/or energy storage;

Maintaining and enhancing our reputation and brand recognition is critical in a competitive energy storage market. If we are not able to maintain and strengthen our reputation and brand recognition, our business and results of operations may be harmed;

Our future success depends on our ability to execute key elements of our business plan;

Our anticipated growth may strain our limited resources;

Our business depends heavily on the continued service of our Chief Executive Officer and Chief Financial Officer, and the loss of their leadership could harm our operations;

Our business depends on our ability to implement improvements to and properly maintain and protect the continuous operation and data integrity of our technology infrastructure, data and other business systems and the inability to do so may have a material adverse effect on our reputation and harm our business prospects, financial conditions, and operating results;

Compromises, interruptions, and shutdowns of our systems, including those managed by third parties, whether intentional or inadvertent, could lead to delays in our business operations and, if significant or extreme, affect our results of operations;

Because we have no current plans to pay regular cash dividends on our Class A Common Stock for the foreseeable future, you may not receive any return on investment unless you sell your Class A Common Stock for a price greater than that which you paid for it;

The dual class structure of our Common Stock may adversely affect the trading market for our Class A Common Stock;

You may be diluted by future issuances of additional Class A Common Stock or Class B Common Stock; future sales of such shares in the public market, or the expectations that such sales may occur, could lower our stock price;

There is a limited market for our common shares, which may make it difficult for you to sell your stock;

David J. Durrett, Independence Investors LLC and its affiliates may exercise substantial influence over us, and they may have interests that differ from those of our other shareholders;

Certain of our officers and Directors may have actual or potential conflicts of interest because of their positions with Independence Investors;

Case law in Nevada may be less likely to provide guidance for specific fact scenarios than in Delaware;

We may be required to incur significant costs and require significant management resources to evaluate our internal control over financial reporting as required under Section 404 of the Sarbanes-Oxley Act;

We may not be able to meet the internal control reporting requirements imposed by the SEC, and any such failure could result in a possible decline in the price of our common stock and our inability to obtain future financing;

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Risks Related to Our Business

We are an early-stage company with an unproven business strategy and may never be able to fully implement our business plan or achieve profitability.

We did not generate any material amount of revenue under the prior TriUnity Business model. In connection with the acquisition of Independence Power, we are implementing our new business plan related to software-enabled control and management of battery energy storage systems deployed at unconventional oil and gas facilities. Our new business plan is at an early stage of operational development and is subject to numerous risks and uncertainties, including those described herein. We anticipate that full implementation of our new business plan could take many years, and success is dependent on many factors beyond our control. Our ability to continue as a going concern depends on our ability to establish commercially viable operations and achieve sustained profitability. There can be no assurance that we will be able to execute our business strategy as planned, successfully develop our business, raise additional capital, consistently generate revenue or that our business model will prove viable. The failure to address the risks and uncertainties to which our business is subject successfully or promptly could have a material adverse effect on our future operating results and financial condition.

Our limited operating history makes it difficult to forecast revenues and plan operating expenses accurately.

To date, the Independence Power business that we acquired in December 2025 has produced revenue only pursuant to the GridCore Installation Project, which was placed into service and generated $97.2 million of revenue for Independence Power in the year ended December 31, 2025. Of that amount, $86.6 million was received in the form of a two year secured promissory note due September 2027 issued by GridCore, with four equal quarterly principal payments beginning in December 2026 (the “GridCore Note”). See “Item 7. Financial Information – Management’s Discussion and Analysis of Financial Condition and Results of Operations,” for a description of the GridCore Note.

Because we have a limited history of operations, we may be unable to forecast future revenues and expenses with accuracy. Any misalignment between anticipated and actual performance could result in unexpected losses and cash flow shortages, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

We recognized a substantial amount of revenue on the GridCore Installation Project, most of it in the form of the GridCore Note, but we expect our revenues in the future to be primarily related to servicing BESS, and there can be no assurance that we will be able to enter into similar installation contracts in the future.

Although we recognized revenue in the year ended December 31, 2025, related to the GridCore Installation Project, most of it in the form of the GridCore Note, there is no assurance that we will be able to enter into similar installation contracts in the future. Instead, we expect our revenues in the future to be primarily related to servicing BESS, and we have only one active servicing agreement, with the Cooperative, as of the date of this Annual Report. See “We expect to generate revenue in the future primarily related to servicing BESS, and to date we have entered into only one such service contract,” “We may not receive any payments under the GridCore Note” and “We may not be able to fully realize the value of the collateral securing the GridCore Note” below.

We expect to generate revenue in the future primarily related to servicing BESS and we have only one active servicing contract.

We expect future revenue generation to be primarily related to and dependent upon servicing BESS upon which our Software Platform is installed. As of the date of this Annual Report, we have only one active servicing contract, the Asset Management Agreement. Our ability to generate revenue in addition to the Asset Management Agreement is depending on our ability to attract new customers, see “—We operate in a highly competitive industry, and our inability to compete effectively could materially affect our business,” “—Our limited capital resources may restrict our marketing efforts and ability to attract customers” and “—Our future success depends on our ability to execute key elements of our business plan.” If we are unable to attract enough customers to generate sufficient additional revenue, we may be forced to reduce or suspend operations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

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We expect to be reliant on the Asset Management Agreement for a substantial portion of our revenue in 2026 and potentially future financial periods. Our ability to successfully perform this contract and to achieve the revenues associated with such performance is subject to a number of risks and uncertainties, including those summarized in these Risk Factors. If the Cooperative is unable to fund and maintain its operations, or we are unable to successfully service the BESS Fleet, or the Asset Management Agreement is terminated for any reason, our financial condition and results of operations in future periods would be materially adversely affected.

We may not receive payments under the GridCore Note

In connection with completion of the installation of the battery software management system on the GridCore Installation Project, we have received the GridCore Note in an aggregate initial principal amount of $86.6 million. Pursuant to the terms of the GridCore Security Agreement (as defined herein), the GridCore Note is secured by a range of collateral, including by a separate promissory note payable by DBD Express to GridCore in the principal amount of $193.42 million (the “DBD Express Note”), and by the related Cooperative Guarantee (as defined herein). See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” for a description of the GridCore Note, the GridCore Security Agreement, the DBD Express Note and the related Cooperative Guarantee and the other collateral securing the respective notes.

Our ability to receive payment on the GridCore Note is subject to the financial condition and results of operations of GridCore, which in turn may depend in part on the financial condition and results of operations of DBD Express and the Cooperative and their ability to make payments on the DBD Express Note and related Cooperative Guarantee, respectively. To the extent that the business, financial condition and results of operations of either GridCore, DBD Express or the Cooperative are adversely affected, their ability to service the GridCore Note, the DBD Express Note or the Cooperative Guarantee, as the case may be, or to repay or refinance such obligations, could be materially and adversely affected. As a result, our ability to receive payments on the GridCore Note is dependent on such factors, and we may not receive timely payments or be paid the amounts due under the GridCore Note at all. Any failure by GridCore, DBD Express or the Cooperative to make timely and full payments in respect of their respective notes could have a material adverse effect on our cash flows, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

In March 2026, the Company received a scheduled cash interest payment of approximately $1.7 million under the GridCore Note.

We may not be able to fully realize the value of the collateral securing the GridCore Note .

The GridCore Note is secured by a range of collateral, including the DBD Express Note and the Cooperative Guarantee. We may not be able to fully realize the value of the collateral securing the GridCore Note due to one or more of the following factors:

the collateral may not be valuable enough to satisfy all of the obligations under the GridCore Note;

bankruptcy laws may limit our ability to realize value from the collateral and may delay the realization process;

the need to obtain regulatory and contractual consents could impair or impede how effectively the collateral would be liquidated and could affect the value received; and

some or all of the collateral may be illiquid and may have no readily ascertainable market value. The liquidity and value of the collateral could be impaired as a result of changing economic conditions, competition, and other factors, including the availability of suitable buyers.

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Additionally, under the GridCore Security Agreement, GridCore pledged, assigned and granted to us a first-priority security interest in such collateral. Failure to perfect the security interest in the collateral, such as by failing to file appropriate financing statements, could adversely affect our ability, upon exercising remedies under the GridCore Note or the GridCore Security Agreement, to realize the value of the GridCore Note. Any failure to realize the value of the GridCore Note could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

We are a holding company with no operations and will depend on distributions from our operating subsidiary to provide us with the funds necessary to meet our financial obligations.

We are a holding company with no direct operating assets or revenue. Our business operations are conducted primarily out of, and almost all of our assets are held by, Independence Power and its subsidiary Kyma Batteries. Our ability to meet financial and other obligations will be dependent on dividends, distributions or other transfers from Independence Power. Payments to us from Independence Power, or indirectly from Kyma Batteries, will be dependent upon its operating results and earnings and subject to any limitations on the ability of such entity to make payments or other distributions to us, including limitations contained in any agreement to which it is a party. If the cash distributions we receive from our subsidiaries are insufficient for us to fund our financial obligations, we may be required to raise cash through the incurrence of debt, the issuance of equity or the sale of assets to fund. However, there is no assurance that we would be able to raise cash by these means. If the ability of any of our subsidiaries to pay dividends or make distributions or payments to us is materially restricted by regulatory or legal requirements, bankruptcy or insolvency, or is limited due to operating results or other factors, it could adversely affect our ability to meet our financial obligations.

We face a variety of risks related to our entry into a new line of business following the completion of the Merger and Acquisition of Independence Power.

Entry into a new line of business may subject us to new laws and regulations with which we are not familiar and may lead to increased litigation and regulatory risk. Further, our management team has not directly engaged in the industrial battery management and monitoring business before, and our lack of experience may result in delays or further complications to our new business and increases our dependence on Kyma Batteries employees that have experience in the field. If we are unable to successfully implement the acquired business of Independence Power, our revenue and profitability may not grow as we expect, our competitiveness may be materially and adversely affected, and our reputation and business may be harmed, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

We will require additional funds in the future to achieve our current business strategy, and our inability to obtain funding may cause our business to fail.

We have limited liquidity and will need to raise additional funds through public or private debt or equity financings in order to support our operations and implement our business plan. Such financings may not be available when needed or may only be available on unfavorable terms. Even if we are able to raise capital, the terms of any such financing could result in dilution of existing shareholders or include preferences that are materially adverse to their interests. If we are unable to obtain financing, we may be forced to delay, scale back, or discontinue our operations, which would have a material adverse effect on our business and could ultimately cause us to decrease or cease operations.

We may also seek additional financing even if in our view such additional financing is not required in order to take advantage of favorable market conditions or for strategic considerations. There can be no assurance that additional financing will be available on favorable terms, or at all. The inability to obtain such additional financing if needed may adversely affect our ability to operate at the levels necessary to execute our business strategy.

Even if we successfully raise additional capital, we may require further funding in the future to continue or expand our operations. There is no guarantee that future financing will be at favorable financial terms. Our failure to raise capital as and when needed would have a negative impact on our financial condition and our ability to pursue our business strategy.

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Technical issues with the Software Platform could disrupt our operations.

Because our business relies entirely on the continued performance of the Software Platform, as applicable, any software or technical malfunctions could materially affect our operations. Remediation of such issues could require significant time, expense, or expertise that we may not possess. A sustained disruption could lead to loss of customers, increased costs, or suspension of our operations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

Our energy storage products and solutions, which are complex, could contain defects, or may not operate at expected performance levels, which may cause us to incur warranty expenses beyond current estimates and could adversely affect our business and results of operations.

Under the GridCore Agreement, we offer product warranties and extended service warranties on all equipment and software provided thereunder (the “GridCore Warranties”), which warranties “pass-through” to the Cooperative as the end-user. We expect to offer comparable warranties to future customers. Our GridCore Warranties cover defects in materials and workmanship of our products for normal use and service conditions for five years following the placed-in-service date. As a result, we bear the risk of warranty claims long after we have sold the products and recognized revenue. Because Independence Power has only recently begun offering its products and services, it is difficult to estimate the warranty and service guaranty expense which we may incur in the future. Our estimated costs of warranty for previously sold products and services may change to the extent future products may not be compatible with earlier generation products under warranty. Furthermore, as we are in a evolving, nascent industry, there is a degree of uncertainty regarding estimated warranty costs due to limited data for the industry as a whole. We have a relatively limited operating history as an independent entity and therefore must project how our solutions will perform over the estimated warranty period. In addition, under real world operating conditions, which may vary by location and design, as well as environmental conditions, our product may perform in a different way than under standard test conditions or other failure data sets. We must develop a reputation for safety and reliability and high-quality products and services, and exceptional customer service in order to attract new customers and maintain existing customers, and grow our business. If our products and services do not perform as anticipated or we experience unexpected reliability problems or widespread product failures, we could incur substantial warranty expense, our brand and market reputation could be significantly impaired and we may lose, or be unable to gain or retain, customers which could have a material adverse effect on our business and results of operations.

We have been required to make assumptions and apply judgments, including the reliability of our Software Platform and any delivered equipment, regarding their performance over the estimated warranty period and our anticipated rate of warranty claims. Our assumptions could prove to be materially different from the actual performance of our products, causing us to incur substantial expense to repair or replace defective products in the future. An increase in our estimates of future warranty obligations due to product failure rates, field service obligations, and rework costs incurred in correcting product failures could cause us to increase the amount of warranty obligations and may adversely impact on our results of operations. If we are unable to cover future warranty claims, our financial condition and results of operations will be adversely affected.

Our customer relationships, business, financial results, and reputation may be adversely impacted due to events and incidents relating to storage, delivery, installation, operation, maintenance, and shutdowns of our energy storage solutions.

Our customer relationships, business, financial results, and reputation may be adversely impacted due to events and incidents relating to storage, delivery, installation, operation, and shutdowns of the BESS units on which our Software Platform is installed, including events and incidents outside of our control. We are subject to various risks as a result of the size, weight, technology, and sophisticated nature of the energy storage solutions on which our Software Platform is installed, including exposure to production, delivery, supply chain, inventory, installation, and maintenance issues. Such issues may, and from time to time have, result in financial losses, including losses resulting from our failure to deliver or install our energy storage solutions on a contractually agreed timeframe, or losses resulting from agreed warranty or indemnity terms. Any of these developments could have a material adverse effect on our business, financial condition, and results of operations.

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Substantially all of Independence Power’s revenue to date was derived in the three months ended September 30, 2025 pursuant to a single contract related to the installation of a battery software management system for the GridCore Installation Basin Project, and there can be no assurance that we will be successful in winning new customers for similar installation projects in the future.

We recognized $97.2 million in revenue in the fiscal year ended December 31, 2025, substantially all of which was related to the installation a battery software management system for the GridCore Installation Project. While we seek to win new customer orders for the installation of battery software management systems in our target market, there can be no assurance that we will be successful in doing so. Factors that could impact our ability to win new projects include changes in the availability of tax credits and other regulatory changes, competitive factors, our brand reputation and other factors described herein. Any failure to win additional installation projects could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

Our ability to generate service revenue is dependent on our ability to establish and maintain a customer base that will generate a recurring stream of revenues. If that recurring stream of revenues does not increase as expected, our operating results will be adversely affected.

We expect to generate revenue primarily from software license and subscription fees and related services associated with use of our Software Platform on deployed units and, where applicable, from fees tied to measured performance outcomes. In the near term, we expect to derive substantially all of our service revenue from a single customer, the Cooperative, and we may continue to derive a significant portion of our service revenue from Cooperative for the foreseeable future. The Cooperative commenced operations in April 2025, and our ability to generate service revenue from the Cooperative will depend in turn on the Cooperative’s ability to expand its active patron-member base. Any failure by the Cooperative to significantly expand its active patron-member base could materially harm our business and negatively impact our revenue, business, financial condition, results of operations, and cash flow.

Our ability to grow our service business in the future will be dependent on our ability to maintain and grow our customer base. There can be no assurances that the Cooperative will allow the Asset Management Agreement to automatically renew for additional five year terms, or that the Cooperative would not exercise its right to terminate the Asset Management Agreement, subject to the obligation to pay to Independence a termination fee equal to 50%. In addition, the Cooperative may terminate its agreement with us in certain circumstances, including if we materially breach our obligations under the Asset Management Agreement. Moreover, there is no assurance that we will be able to attract additional customers on favorable terms, if at all.

If we are unable to successfully market our service business and maintain and grow our existing customer base, then the potential success of our service business will be less than we anticipate, which could have a material adverse impact on our business, prospects and operations. Any reduction in the volume of services required under our service agreements or loss of any one of the Company’s significant customers, including the Cooperative, a significant customer’s inability to perform under its respective contracts, including any default in payment, a significant dispute with one of these customers, a significant downturn or deterioration in the business or financial condition of any of these customers, any delay of contracting processes with customers due to economic uncertainty, or any other event negatively impacting the contractual relationship with one of these customers could have a material adverse effect on the brand, business, revenues, financial condition, and cash flows of the Company.

For the near future, we expect to continue to derive a significant portion of our total revenue from a small number of customers. Accordingly, loss of a significant customer or a significant reduction in order volume from a significant customer or a change in contracting behavior by a significant customer could materially reduce revenue recognized and operating results in any reporting period compared to prior periods and/or expectations and impact our results of operations.

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We operate in a highly competitive industry, and our inability to compete effectively could materially affect our business.

We operate in an intensely competitive business environment for our energy storage solutions, services, and digital application offerings. To increase our revenue and market share, our business strategy depends on our ability to attract new customers and retain our existing customers. Certain of our competitors have financial, technical, manufacturing, marketing, and other resources that are greater than ours, which may allow them to devote greater resources to the design, development, manufacturing, distribution, promotion, sale and support of their offerings than we may be able to and therefore more effectively compete for new projects and customers. We expect competition in the energy storage industry to increase primarily due to increased demand from customers and recent regulatory changes and incentives geared towards encouraging the adoption of increased renewable energy assets as well as energy storage solutions, including as a result of the IRA and the OBBBA and their current anticipated impacts in the United States.

Consolidation by other industry participants could further increase their resources and result in competitors with expanded market share, larger customer bases, greater diversified product and service offerings and greater technological and marketing expertise, which may allow them to compete more effectively against us in the future. Moreover, our competitors may have or may develop solutions, services, or digital applications that are superior, more efficient, and more effective compared to our offerings (on a price-to-value basis, operational impact, or otherwise), may offer products with a lower total cost of ownership, or may adapt more quickly to new or emerging technologies. If we are unable to convince potential customers of the benefits and superiority of our offerings, effectively differentiate our offerings from our competitors, or if potential or existing customers prefer the offerings of our competitors, we may not be able to effectively implement our growth strategy, which in turn may have a material adverse effect on our business.

Additionally, substantially all of our revenue to date has been from GridCore in connection with the Company’s embedded Software Platform on the BESS Fleet. If we fail to maintain this relationship or if this relationship weakens, or if the Cooperative decides to reduce or modify its energy storage activities, it could materially impact our business prospects, financial condition, cash flows, or sales. Our future growth would then be even more reliant on our ability to compete for and retain new customers and our inability to do so would harm our ability to execute our growth strategy, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

Our competitors may lower their sales prices in response to market competition. Some competitors may have lower operating expenses due to greater vertical integration and supportive regulatory frameworks, allowing them to operate with minimal or even negative margins over time. This may in the future hinder our ability to compete in certain markets, which may lead to reduced net sales and negatively impact our operating results. In response to such competitive pressures, we may also choose to adjust our pricing strategy in certain markets or reduce our margin expectations, which could further affect our financial performance.

Our business and customer demand for our offerings depends in large part on government incentives and/or regulations relating to the use of renewable energy and/or energy storage.

Changes or potential changes to government incentives or regulations has and could in the future impact demand for our energy storage solutions, which could lead to material adverse effects to our business, operating results, and cash flows. Federal, state, local, and foreign government bodies provide incentives and/or regulations relating to mandating or encouraging use of energy storage to owners, end users, distributors, system integrators, and manufacturers of energy storage products and solutions to promote energy storage in the form of rebates, tax credits, other financial incentives, procurement requirements and market structures. The range and duration of these incentives and regulations varies widely by jurisdiction and type of asset involved. The reduction, elimination, modification, expiration, or determination of inapplicability of government incentives or regulations related to mandating or encouraging the use of energy storage or the potential of any such reduction, elimination, modification, expiration, or determination of inapplicability of government incentives or regulations has and may in the future negatively affect the competitiveness of our offerings and the growth of our industry and our business. Such government incentives and/or regulations may expire on a particular date, end when the allocated funding is exhausted or be reduced or terminated as energy storage adoption rates increase or as a result of legal challenges, changing policies or priorities, the adoption of new statutes or regulations or changes to existing regulations, new regulatory guidance, or the passage of time. Reductions, modification, terminations, or determination of inapplicability of government incentives and/or regulations may occur without warning. Such policies, regulations, and incentives may not continue to exist in current form, or at all. The reduction, modification, elimination, or expiration or the potential of any such reduction, elimination, modification, expiration, of such government incentives or regulations or determination of inapplicability of such government incentives or regulations may in the future impact customer demand for our offerings, may lead to a loss of customers and potential customer projects, and may in the future have a material adverse on our business, financial condition, results of operations and the value of our shares of Common Stock.

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For example, in August 2022, the United States passed the IRA, which included incentives that supported the adoption of energy storage solutions, including a new “technology neutral” Section 48E investment tax credit (the “ITC”) and Section 45Y production tax credit (the “PTC”), and changes to the previous Section 48 non-”technology neutral” investment tax credit and Section 45 production tax credit. On July 4, 2025, the OBBBA was signed into law, which significantly modified certain provisions of the IRA, including those related to energy storage. The OBBBA supports energy storage in the United States, as the bill includes long-term continued availability of the ITC for energy storage projects. Certain tax credits, notably including the ITC for energy storage, will begin to phase down for projects that start construction (in accordance with Internal Revenue Service (“IRS”) guidance) after 2033. The prevailing wage and apprenticeship requirements enacted under the IRA continue to apply under the OBBBA for the project owner to receive the full ITC value, and the credit value can be further increased if the project owner also qualifies for a domestic content bonus credit and energy communities bonus credit. The OBBBA amended the provisions of the domestic content bonus credit for the ITC such that the project owner now must achieve higher minimum domestic content percentage thresholds. In addition, the OBBBA amended the ITC establishing new Prohibited Foreign Entity (“PFE”) restrictions.

The new PFE restrictions apply to virtually all key tax credits under the IRA and come in two forms: (i) for tax years beginning after July 4, 2025, the taxpayer taking the ITC tax credit cannot not be a PFE and (ii) for ITC projects that start construction in 2026 and after, the ITC eligible project must source a certain percentage of material from non-PFEs (known as “material assistance”), and the percentage of material from non-PFEs increases annually over time. The OBBBA includes substantive details regarding PFE restriction compliance requirements and requires U.S. Department of Treasury to issue implementation regulations by December 31, 2026. There is continuing uncertainty on certain aspects of the IRA and related guidance, the OBBBA and forthcoming related guidance (including with respect to PFE restrictions). In the past such uncertainty related to the IRA caused certain customers to take an extended period to evaluate, negotiate, and enter energy storage arrangements, which has impacted our business and results of operations. Current uncertainty related to changes imposed by the OBBBA may in the future similarly cause customers to delay contracting decisions or may cause customers to delay or cancel existing projects as they navigate such uncertainty, which could have a material negative effect on our business and results of operations.

If we are unable to provide energy storage solutions that qualify our customers for the ITC (with or without the domestic content bonus credit) under the OBBBA on the timeline and in such quantities that we currently anticipate, then there may be negative impacts to our reputation, ability to compete in the market, demand from our customers, and our financial condition. Our competitors may be able to build a more robust domestic supply chain than us and may be able to offer customers U.S. domestic content products in greater quantity, with better pricing, and on a faster timeline than we may be able to if our production of our battery components in the U.S. (e.g., modules, cells, enclosures, and thermal management systems) is delayed or hindered or otherwise negatively impacted (including through the PFE restrictions under the OBBBA). Such impacts would adversely impact our brand and ability to compete, and in turn would adversely affect our results of operations.

The full impact of the modifications to the tax credits and PFE restrictions in the OBBBA, its accompanying guidance, and potential changes in law that may apply to our business and operations as well as our customers’ and suppliers’ businesses cannot be known with certainty and we may not recognize the full extent of benefits we currently anticipate, which may materially and adversely impact our business, financial condition, and results of operations. We are continuing to evaluate the potential overall impact and applicability of these tax credits, as modified by the OBBBA, and any potential future changes in law on our business and operations.

The international markets in which we may operate in the future have or may in the future put in place policies to promote energy storage. These incentives and mechanisms vary from country to country. In seeking to achieve growth internationally, we may in the future make investments that, to some extent, rely on governmental incentives and support in a new market. We may not be able to optimize the benefits offered by these incentives or realize the growth that we expect from investments in the incentives, particularly in relation to competitors whose products might benefit disproportionately from these incentives. Governments may not continue to provide sufficient incentives and support to the energy storage industry and the industry in any particular country may suffer significant downturns in the future as the result of changes in public policies or government interest in renewable energy, any of which would adversely affect demand for our energy storage solutions and services.

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Several of the rules and regulations that we and our customers are subject to are not fully defined by the U.S. government at this time, and there are risks related to the interpretations of and assumptions made about such rules and regulations by us and others as a result.

Maintaining and enhancing our reputation and brand recognition is critical in a competitive energy storage market. If we are not able to maintain and strengthen our reputation and brand recognition, our business and results of operations may be harmed.

As the markets for energy storage and related SaaS products for storage become increasingly competitive, marketing initiatives are becoming increasingly time-consuming and expensive. Our marketing activities may not be successful or yield the anticipated increased revenue, the increased revenue may not offset the expenses we incur as part of any marketing initiatives, and our results of operations could be harmed. Our ability to maintain and strengthen our brand depends heavily on our ability to provide quality offerings to our customers and to continue to meet our performance commitments in our underlying contracts with both suppliers and customers. In order to protect our brand, we may also expend substantial resources to register our intellectual property rights and to prevent others from using similar intellectual property, including similar patents, copyrights, and trademarks. Any factor that diminishes our reputation or that of our management, including failing to meet the expectations of or provide quality products and services to our customers on a timely basis, or any adverse publicity, litigation, or regulatory proceeding, has in the past and could in the future make it more difficult for us to attract new customers and to maintain our existing customers. Our ability to successfully position our brand could also be adversely affected by perceptions of our competitors’ energy storage solutions, services, and digital applications. If we do not successfully maintain and strengthen our reputation and brand recognition, our business may not grow as we expect, if at all, and we could lose our relationships with existing customers, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

Our limited capital resources may restrict our marketing efforts and ability to attract customers.

Because we have limited financial resources, our marketing activities may be insufficient to generate meaningful awareness of our products. If we are unable to attract enough customers to achieve profitability, we may be forced to reduce or suspend operations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

We expect our operating results to fluctuate from quarter to quarter.

Our revenues and operating results may vary significantly between quarters due to factors such as demand fluctuations, customer retention rates, growth management challenges, and general economic conditions. These variations may cause results in future periods to fall short of market expectations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

The historical financial results of the Company, may not be indicative of what the Company’s actual financial position or results of operations would have been.

The historical financial results included herein is presented for illustrative purposes only and is not necessarily indicative of what the Company’s actual financial position or results of operations would have been had the Merger been completed on the dates indicated. Accordingly, the combined business, assets, results of operations and financial condition may differ significantly from those indicated in the historical financial results, and such variations may have a material adverse effect on our financial condition, results of operations and the value of our shares of Common Stock.

Our future success depends on our ability to execute key elements of our business plan.

Our ability to achieve profitability depends on successfully implementing our business plan, which includes acquiring customers, establishing operational systems, and managing business processes efficiently. Failure to achieve these milestones could impair our ability to expand or sustain operations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

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Our anticipated growth may strain our limited resources.

If our business expands, we may face significant operational and managerial challenges due to limited personnel and financial resources. Our systems and controls may not be adequate to support such growth, which could have a material adverse effect on our results of operations and financial condition.

Our business depends heavily on the continued service of our Chief Executive Officer and Chief Financial Officer, and the loss of their leadership could harm our operations.

We rely heavily on the experience and leadership of Todd Parkin, our Chief Executive Officer, and Scott Stephenson, our President and Chief Financial Officer. We currently have employment agreements with each of Mr. Parkin or Mr. Stephenson, see “Item 11. Executive Compensation – Employment Agreements; Change in Control Benefits” of this Annual Report. The loss of their services could materially delay or disrupt our business operations, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

If we cannot effectively expand our sales and marketing capabilities, our revenues may not grow.

We must continue to develop our sales and marketing functions to increase awareness and adoption of our technology. If we fail to recruit, train, and retain capable sales and marketing personnel, we may be unable to gain market traction or enter new markets. This could have a material adverse effect our revenue growth and financial performance.

Technical issues, including data loss, system outages, or software errors, could impair our platform and lead to customer attrition.

The Software Platform depends on stable software performance and data integrity. If the Software Platform experiences prolonged or repeated disruptions such as data loss, system outages, or software errors lasting more than a temporary period, users may discontinue use of the service, adversely affecting revenue and reputation, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

We rely on third-party vendors and hosting providers, and interruptions in their services could adversely affect our business.

The Software Platform depends on external vendors and hosting providers for essential components of its platform. If those services are disrupted or terminated, our Software Platform could become inaccessible, resulting in customer losses and an increase in the Company’s deficit.

We do not maintain a formal cybersecurity risk management framework, which increases our vulnerability to cyber threats.

We have not adopted a formal, written cybersecurity risk management policy or cybersecurity governance framework, and we do not have dedicated cybersecurity personnel. Our current measures, which comprise primarily third-party cloud-based software and IT vendors and reliance on their built-in security protocols, may not be sufficient to prevent or detect cyberattacks.

Like many technology companies, the Company’s technology faces the risk of cyberattacks (including malicious and destructive code, misconfigurations, “bugs” or other vulnerabilities in commercial software that is integrated into our (or our suppliers’) IT systems, products, or services, social engineering attacks, phishing attacks, ransomware, and denial of service attacks), unauthorized access, physical or electronic security breaches and other malicious activity. If our systems or those of our providers are compromised, we could suffer business disruptions, financial losses, recovery expenses, reputational harm, and potential legal liability. A material breach in the security of our IT systems could include the theft of our trade secrets, customer information, human resources information, or other confidential data, including but not limited to personal information. Material breaches could also include targeted attacks against the control plane of remotely serviced battery energy storage systems within our customers’ environments, resulting in operational disruption to energy storage or physical damage to batteries, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

To the extent that any disruption or security breach results in the compromise of the control plane of one or more of our serviced customer sites, or a loss or damage to our data, or an inadvertent disclosure of confidential, proprietary personal, 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 (including class actions), and adversely affect our business. We cannot guarantee that future cyberattacks and cybersecurity incidents, if successful, will not have a material adverse effect on our business or financial results.

If we fail to comply with our obligations under cybersecurity laws in the jurisdictions in which we operate, we could be subject to regulatory action and lawsuits (including class actions). We may also have other obligations, for example, under contracts, to notify customers or other counterparties of a security incident, including a data breach. Any compromise of our security could also result in a violation of applicable domestic and foreign security, privacy or data protection, consumer protection, 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. While we expect to 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.

Risks Related to Our Intellectual Property and Technology

If we are unable to obtain, maintain, and enforce adequate protection for our intellectual property or if the scope of our intellectual property protection is not sufficiently broad, others may be able to develop, commercialize, and/or receive patents for technology and intellectual property substantially similar to ours, and our ability to successfully commercialize our technology or intellectual property may be adversely affected.

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Our business depends on internally developed technology or other internally developed intellectual property, including software, databases systems, confidential information, and know-how, the protection of which is crucial to the success of our business. We rely on a combination of patent, trademark, trade-secret, copyright, and other intellectual property protection laws as well as internal confidentiality procedures and contractual provisions to establish, maintain, and protect our intellectual property rights in our internally developed technology and other intellectual property. However, our rights under these laws and agreements only afford us limited protection and the actions we take to establish, maintain, and enforce our intellectual property rights may not leave us free from adverse effects. We will, over time, take additional steps in protecting our intellectual property through growing our internal intellectual property team and through additional trademark, patent, and other intellectual property filings both in the United States and abroad that will be expensive and time-consuming. Effective intellectual property protection is expensive to develop and maintain and the aggregate costs of maintaining a portfolio of patents and registered copyrights and trademarks and trade secrets can be substantial, both in terms of initial and ongoing prosecution and maintenance requirements and the costs of enforcing and defending our rights. Despite our efforts to protect our intellectual property, these measures taken to date cannot guarantee us complete protection from our competitors or from other third parties attempting to copy, reverse engineer, or otherwise obtain and use our intellectual property. If we are unable to protect our intellectual property rights, our competitive position could be harmed, business opportunities and demand for our products, services and digital application offerings could decrease, and our business could be adversely impacted as third parties may be able to commercialize and use technologies, software products and intellectual property that are substantially the same as ours without incurring the development and licensing costs that we have incurred.

Any of our owned or licensed intellectual property rights could be challenged, invalidated, circumvented, infringed, or misappropriated, and our trade secrets and other confidential information could be disclosed in an unauthorized manner to third parties. Some of our services rely on technologies and software developed by or licensed from third parties, and we may not be able to maintain our relationships with such third parties or enter into similar relationships in the future on reasonable terms or at all. Further, in some cases, our intellectual property rights may not be sufficient to circumvent third party intellectual property and thereby not permit us to take advantage of market trends nor providing us with competitive advantages, which could result in costly redesign efforts, discontinuance of certain offerings, or other competitive harm.

Additionally, monitoring unauthorized use of our intellectual property is cumbersome and costly and any steps taken to prevent misappropriation may not be successful. In the future, we may seek to enforce our rights against potential infringers, however, the steps we have taken to protect our intellectual property rights still may not prevent actual infringement or misappropriation of our intellectual property. We may not be able to detect unauthorized use of, or take appropriate steps to enforce, our intellectual property rights. We may also have to resort to litigation to enforce our intellectual property rights, which could result in substantial costs and diversion of our resources.

Uncertainty may result from changes in intellectual property laws as a result of new legislation and from new interpretations of intellectual property laws by applicable courts and agencies throughout the world. Accordingly, despite our efforts, we may be unable to obtain and maintain the intellectual property rights necessary to provide us with a competitive advantage. Our failure to obtain, maintain, and enforce our intellectual property rights could therefore have a material adverse effect on our business, financial condition, and results of operations.

As a technology company selling commercial products, we run the risk of being sued by third parties for infringement, misappropriation, dilution, or other violation of their intellectual property or proprietary rights.

Technology, internet, advertising, and in general most companies involved with commercially selling products, frequently are subject to litigation based on allegations of infringement, misappropriation, dilution, or other violations of intellectual property rights. Some of these companies, including some of our competitors, as well as non-practicing entities, own or have rights to large numbers of patents, copyrights, trademarks, and trade secrets, which they may use to assert claims against us. For instance, the use of our technology to provide our offerings could be challenged by claims that such use infringes, dilutes, misappropriates, or otherwise violates the intellectual property rights of a third party. In addition, we may in the future be exposed to claims that content published or made available through our applications or websites violates third-party intellectual property rights.

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As we face increasing competition and as a public company, the possibility of intellectual property right claims against us grows. Such claims and litigation may involve patent holding companies or other adverse intellectual property rights holders who have no relevant product revenue, and therefore our own pending patents and other intellectual property rights may provide little or no deterrence to these rights holders in bringing intellectual property right claims against us. Third parties may hold vast and/or undisclosed intellectual property rights that cover significant aspects of our technologies, content, branding, or business methods, and we cannot completely and consistently assure that we are not infringing or violating, and have not violated or infringed, any third-party intellectual property rights or that we will not be held to have done so or be accused of doing so in the future. We may not be aware of existing patents or patent applications that could be pertinent to our business as many patent applications are filed confidentially in the United States and are not published until 18 months following the applicable filing date. We expect that we may receive in the future notices that claim we or our customers using our energy storage solutions, services or digital applications, have infringed or misappropriated, other parties’ intellectual property rights, particularly as the number of competitors in our market grows and the functionality of applications amongst competitors overlaps.

Any claim that we have violated intellectual property or other proprietary rights of third parties, with or without merit, and whether or not it results in litigation, settlement out of court, or is determined in our favor, could be time-consuming and costly to address and resolve, and could divert the time and attention of management and technical personnel from our business and the day-to-day operations. Furthermore, an adverse outcome of a dispute may result in an injunction and could require us to pay substantial monetary damages, including treble damages and attorneys’ fees, if we are found to have infringed a party’s intellectual property rights. Any settlement or adverse judgment resulting from such a claim could require us to enter into a licensing agreement to continue using the technology, content, or other intellectual property that is the subject of the claim; restrict or prohibit our use of such technology, content, or other intellectual property; require us to expend significant resources to redesign our technology or solutions; and require us to indemnify third parties. Royalty or licensing agreements, if required or desirable, may require significant royalty payments and other expenditures, or, they may be unavailable on commercially reasonable terms that are acceptable to us, or at all. We may also be required to develop alternative non-infringing technology, which could require significant time and expense and diversion of resources. We may not be able to develop or license suitable alternative technology, content, or other intellectual property to permit us to continue offering the affected technology, content, or services to our customers. If we cannot develop or license technology for any allegedly infringing aspect of our business, we would be forced to limit our offerings and may be unable to compete as effectively, if at all. Any of these events could materially harm our business, financial condition, and results of operations.

If our trademarks and trade names are not adequately protected or protectable, we may not be able to build name recognition in our markets of interest, and our competitive position may be harmed.

The registered and unregistered trademarks and trade names that we own may be challenged, infringed, circumvented, declared generic, lapsed, or determined to be infringing on or dilutive of other marks. We may not be able to protect our rights in these trademarks and trade names, which we need in order to build name recognition with potential members, partners, and clients. In addition, third parties may file for registration of trademarks similar or identical to our trademarks, thereby impeding our ability to build brand identity and possibly leading to market confusion. If they succeed in registering or developing common-law rights in such trademarks, and if we are not successful in challenging such third-party rights, we may not be able to use these trademarks to develop brand recognition of our technologies, products, or services. In addition, there could be potential trademark infringement claims brought by owners of other registered or unregistered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. If we are unable to establish name recognition based on our trademarks and trade names, we may not be able to compete effectively, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

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We may not be able to enforce our intellectual property rights throughout the world.

As the geographic scope of our business expands, we will need to consider protecting our proprietary technology and other intellectual property in an increasing number of jurisdictions, a process that is expensive and may not be successful, and accordingly we may choose not to do so in every location. Filing, prosecuting, maintaining, defending, and enforcing intellectual property rights on our products, services, digital applications, and technologies in all countries throughout the world could be prohibitively expensive, and our intellectual property rights in some countries outside the United States can be less extensive than those in the United States. We do not own and have not registered or applied for intellectual property registrations in all countries outside the United States. Competitors may use our technologies in jurisdictions where we have not obtained protection to develop their own products, services, digital applications, and technologies and, further, may export otherwise violating products and services to territories where we have protection but enforcement is not as strong as that in the United States. These products, services, digital applications, and technologies may compete with our products, services, digital applications, and technologies, and we may not be effective or sufficient at preventing them from competing. In addition, the laws of some foreign countries do not protect certain proprietary and intellectual property rights to the same extent as the laws of the United States, and many other companies have encountered significant challenges in establishing and enforcing certain of their proprietary and intellectual property rights outside of the United States. These challenges can be caused by the absence or inconsistency of the application of rules and methods for the establishment and enforcement of intellectual property rights outside of the United States. For instance, there is no uniform worldwide policy regarding patentable subject matter or the scope of claims allowable for business methods. As such, we cannot ascertain the degree of future protection that we will have on our technologies, products, services, and digital applications.

In addition, the legal systems of some countries, particularly developing countries, do not favor the enforcement of intellectual property rights to the same degree at the United States. This could make it difficult for us to stop the misappropriation, dilution, infringement, or other violation of certain of our intellectual property rights. Accordingly, we may choose not to seek protection in certain countries, and thus, we will not have the benefit of intellectual property protection in such countries. Proceedings to enforce our intellectual property rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business. In addition, our efforts to protect our intellectual property rights in such countries may be inadequate. Changes in the law and the interpretation thereof as well as legal decisions by courts in the United States and foreign countries may affect our ability to obtain, maintain, and enforce adequate intellectual property protection for our products, services, digital applications, and other technologies. Any of the foregoing could have a material adverse effect on our competitive position, business, financial condition, results of operations, and prospects.

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Compromises, interruptions, and shutdowns of our systems, including those managed by third parties, whether intentional or inadvertent, could lead to delays in our business operations and, if significant or extreme, affect our results of operations.

From time to time, our Software Platform may require modifications and updates, including by adding new hardware, software, and applications, maintaining, updating, or replacing legacy programs, and integrating new service providers and adding enhanced or new functionality. There are inherent risks associated with modifying or replacing systems, and with new or changed relationships, including accurately capturing and maintaining data, realizing the expected benefit of the change, and managing the potential disruption of the operation of the systems as the changes are implemented. Potential issues associated with implementation of these technology initiatives has previously and could in the future reduce the efficiency of our operations in the short term. The efficient operation and successful growth of our business depends upon functional and efficient systems, including our financial, information technology, operating, and other systems. The failure of our systems and related third-party systems we rely on to perform as designed, or our failure to implement and operate them effectively, could disrupt our business or subject us to liability and thereby may have a material adverse effect on our business, financial condition, results of operations, and prospects.

Risks Related to Ownership of our Class A Common Stock

Because we have no current plans to pay regular cash dividends on our Class A Common Stock for the foreseeable future, you may not receive any return on investment unless you sell your Class A Common Stock for a price greater than that which you paid for it.

We do not anticipate paying any regular cash dividends on our Class A common stock in the foreseeable future. Any decision to declare and pay dividends in the future will be made at the discretion of our Board of Directors and will depend on, among other things, general and economic conditions, our results of operations and financial condition, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions, and such other factors that our Board of Directors may deem relevant. In addition, our ability to pay dividends is, and may be, limited by covenants of any future outstanding indebtedness we or our subsidiaries incur. Therefore, any return on investment in our Class A common stock is solely dependent upon the appreciation of the price of our Class A common stock on the open market, which may not occur.

The dual class structure of our Common Stock may adversely affect the trading market for our Class A Common Stock.

We cannot predict the effect our multiple class structure may have on the market price of our Class A Common Stock. We cannot predict whether our multi-class structure will result in a lower or more volatile market price of our Class A Common Stock, in adverse publicity or other adverse consequences. Certain stockholder advisory firms and large institutional investors may prefer companies that do not have multiple share classes or may have investment guidelines that preclude them from investing in companies that have multiple share classes. Any actions or publications by stockholder advisory firms or institutional investors critical of our corporate governance practices or capital structure could also have a material adverse effect on the value of our Class A Common Stock.

You may be diluted by future issuances of additional Class A Common Stock or Class B Common Stock; future sales of such shares in the public market, or the expectations that such sales may occur, could lower our stock price.

The sale of shares of our Class A Common Stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Class A Common Stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.

As of March 27, 2026, we have a total of 41,650,000 shares of Class A Common Stock outstanding. Of the outstanding shares, 14,700,000 shares held by public investors are freely tradable without restriction or further registration under the Securities Act. Additionally, the Cooperative holds warrants exercisable for 62,312,964 shares of Class A Common Stock. Any shares of Class A Common Stock held by our affiliates may become eligible for resale pursuant to Rule 144 under the Securities Act, subject to the volume, manner of sale, holding period and other limitations of Rule 144. The issuance of shares of Class A Common Stock upon the conversion of any outstanding warrants would dilute the percentage ownership interest of holders of our Class A Common Stock, including relative voting rights, dilute the book value per share of our Class A Common Stock, and increase the number of our outstanding shares, which could further depress the market price of our Class A Common Stock.

There is a limited market for our common shares, which may make it difficult for you to sell your stock.

Our common shares are quoted on the OTCID Basic Market. The Company has applies to change its current symbol “TYBB,” to “ITXP,” which remains subject to OTC and FINRA approval. There is a limited trading market for our shares and there frequently has been days on which there is no trading in our shares. Accordingly, there can be no assurance as to the liquidity of any markets that may develop for our Class A Common Stock, the ability of holders of our Class A Common Stock to sell their shares, or the prices at which holders may be able to sell our Class A Common Stock. Further, because of the thin float, the reported bid and asked prices may have little relationship to the price you would pay if you wanted to buy shares or the price you would receive if you wanted to sell shares.

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Risks Related to Our Existing Shareholders

David J. Durrett, Independence Investors LLC and its affiliates may exercise substantial influence over us, and they may have interests that differ from those of our other stockholders.

After giving effect to the Merger, Independence Investors and Energizer Systems together, and David J. Durrett (the “Principal Stockholder”) as holder of all limited liability company interests in Independence Investors, beneficially own 94.33% the shares of our outstanding common stock, including all of our outstanding shares of Class B Common Stock, representing more than 99% of the combined voting power of all classes of our voting stock. Our Principal Stockholder may elect to convert all of the issued and outstanding shares of Class B Common Stock into fully paid and nonassessable shares of Class A Common Stock. Given the number of shares of Class B Common Stock beneficially owned by our Principal Stockholder, even following any such conversion and until the date Mr. Durrett beneficially owns less than the required voting percentage, he will likely continue to have the ability to elect all of the members of our Board of Directors and thereby control our management and affairs, including determinations with respect to acquisitions, dispositions, borrowings, issuances of common stock or other securities, and the declaration and payment of dividends on our common stock. In addition, our Principal Stockholder and Independence Investors will continue to be able to determine the outcome of all matters requiring stockholder approval on a combined class vote basis, and will continue to be able to cause or prevent a change of control of our Company or a change in the composition of our Board of Directors. The concentration of ownership could deprive other holders of our Class A Common Stock of an opportunity to receive a premium for their common stock as part of a sale of our Company and might ultimately negatively affect the market price of our Class A Common Stock.

The Company through Independence Power and Kyma Batteries, its wholly owned subsidiaries, is also party to agreements with certain affiliates of Independence Investors, including the Administrative Services Agreement and the Commercial Lease Agreement (the “Commercial Lease”) between Independence WI LLC (“Independence WI”) and Kyma Batteries. Pursuant to the Administrative Services Agreement, IPAS Asset Management will perform certain enumerated administrative services in exchange for a nominal fee plus reimbursement of all expenses incurred by IPAS Asset Management while performing such services. Pursuant to the Commercial Lease, we lease property in Wisconsin for 12-month periods, beginning January 1, 2025, for a monthly payment of $50,000. See “Item 13. Certain Relationships and Related Transactions, and Director Independence – Certain Business Relationships” for a description of each of the Administrative Services Agreement and the Commercial Lease. The Company and Independence Investors or its affiliates may enter into various transactions from time to time in the future.

In addition, certain decisions concerning our operations or financial structure may present conflicts of interest between Independence Investors and its affiliates, on the one hand, and our other stockholders, on the other. For example, Independence Investors may in the future engage in a wide variety of activities in our industry that may result in conflicts of interest with respect to matters affecting us. Independence Investors may also make investments in businesses that directly or indirectly compete with us, or may pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

The A&R Charter includes a corporate opportunity waiver.

To the fullest extent permitted under the NRS, the A&R Charter renounced any interest or expectancy of the Company in, or in being offered an opportunity to participate in, business opportunities that are presented to members of the Board of Directors who are not employees of the Company (a “Non-Employee Director”) (including any Non-Employee Director who serves as an officer in both his or her director and officer capacities). Our Non-Employee Directors and their respective affiliates do not (to the fullest extent permitted by applicable law) have any liability to the Company for any breach of fiduciary duty for engaging in any such activities or from not disclosing any corporate opportunities to the Company or from pursuing or acquiring such opportunities themselves or offering or directing such opportunities to any other person. As a result of these provisions, the Company may be not be offered certain corporate opportunities which could be beneficial, or our Non-Employee Directors may direct such opportunities to certain other businesses in which they are engaged (or such other businesses may otherwise pursue such opportunities) causing them to compete with the Company, which may cause such opportunities not to be available to the Company or to become more expensive or difficult for the Company to pursue, which could adversely impact the Company’s business or prospects. By being a stockholder in the Company, you will be deemed to have notice of and have consented to these provisions of our articles of incorporation.

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Certain of our officers and Directors may have actual or potential conflicts of interest because of their positions with Independence Investors.

Scott Stephenson serves as our President, Chief Financial Officer, and Treasurer, as well as a member of the Board of Directors, and he retains his position with Independence TX, Independence Investors and Independence WI. Energizer Systems, which beneficially owns 10.01% of the Company’s total issued and outstanding Common Stock, is a wholly-owned subsidiary of Independence Investors. These holdings in and compensation from Independence Investors may be significant. These positions at Independence Investors and the other Independence companies, any compensation from Independence Investors and the other Independence companies, and the ownership of any equity or outstanding equity awards in Independence Investors may create the appearance of conflicts of interest when Mr. Stephenson is faced with decisions that could have different implications for Independence Investors and the other Independence companies than the decisions have for us.

Risks Related to Nevada Law, the A&R Charter and Anti-Takeover Provisions

Case law in Nevada may be less likely to provide guidance for specific fact scenarios than in Delaware.

The Company is a Nevada corporation. Because of Delaware’s prominence as a state of incorporation for many large corporations, the Delaware courts have developed considerable expertise in dealing with corporate issues and a substantial body of case law has developed construing Delaware law under certain sets of facts. While Nevada also has adopted comprehensive, modern and flexible corporate law statutes, because the volume of Nevada case law concerning the effects of its statutes and regulations is more limited, the Company may experience, and its stockholders may experience, less predictability with respect to the legal requirements in connection with corporate affairs and transactions, and stockholders’ rights to challenge them in specific situations where the application of the statute may be open to differing interpretations.

The Company’s directors and officers are protected from liability for a broad range of actions.

Nevada law, by default, with certain specific exceptions, eliminates the liability of directors and officers, to a corporation and its stockholders and creditors, except where (i) the presumption that such director or officer has acted in good faith, on an informed basis and with a view to the interests of the corporation has been rebutted, and (ii) it is proven that such director’s or officer’s act or failure to act was a breach of his or her fiduciary duties and such breach involved intentional misconduct, fraud or a knowing violation of law. The A&R Charter provides that, to the fullest extent permitted by Nevada law, its directors and officers will not be individually liable to it or any of its stockholders or creditors for damages as a result of any act or failure to act in their respective capacities as a director or officer.

The A&R Charter provides that the Eighth Judicial District Court of Clark County, Nevada and, except where the NRS confers mandatory sole jurisdiction on the district court of the State of Nevada, any state or federal court located in Dallas County, Texas are the sole and exclusive forums for substantially all disputes between the Company and its stockholders, which could limit the stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers or employees.

The A&R Charter provides that the Eighth Judicial District Court of Clark County, Nevada and, except where the NRS confers mandatory sole jurisdiction on the district court of the State of Nevada, any state or federal court located in Dallas County, Texas are the sole and exclusive forums for many disputes between the Company and its stockholders, which could limit the stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers or employees. The A&R Charter provides that, unless the Company consents in writing to the selection of an alternative forum, to the fullest extent permitted by applicable law the Eighth Judicial District Court of Clark County, Nevada and, except where the NRS confers mandatory sole jurisdiction on the district court of the State of Nevada, any state or federal court located in Dallas County, Texas are the sole and exclusive forums for any or all actions, suits or proceedings, whether civil, administrative or investigative or that asserts any claim or counterclaim: (a) brought in the Company’s name or right or on its behalf, (b) asserting a claim for breach of any fiduciary duty owed by any of the Company’s current or former directors, officers, stockholders, employees, agents or fiduciaries or its stockholders, (c) for any internal action (as defined in NRS 78.046), including any action asserting a claim against the Company arising pursuant to any provision of NRS Chapters 78 or 92A, any provision of the A&R Charter or the A&R Bylaws, any agreement entered into pursuant to NRS 78.365 or as to which the NRS confers jurisdiction on the district court of the State of Nevada, (d) to interpret, apply, enforce or determine the validity of the A&R Charter or the A&R Bylaws or (e) governed by the internal affairs doctrine.

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The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or its directors, officers, or other employees, which may discourage such lawsuits against the Company and its directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in the A&R Charter to be inapplicable or unenforceable in an action, the Company may incur additional costs associated with resolving such action in other jurisdictions, which in turn could have a material adverse effect on our business, financial condition, results of operations and the value of our shares of Common Stock.

The Company’s governing documents and Nevada law could discourage takeover attempts and other corporate governance changes.

The A&R Charter and A&R Bylaws contain provisions that could delay or prevent a change in control of the Company. These provisions may also make it difficult for the Company’s stockholders to elect directors that are not nominated by the current members of the Board of Directors or take other corporate actions, including effecting changes in our management. These provisions include the following provisions:

permit the Board of Directors to establish the number of directors and fill any vacancies and newly created directorships;

require super-majority voting to amend certain provisions in our articles of incorporation and bylaws;

a restriction on acquiring more than a 20% ownership interest in the Company;

authorize the issuance of “blank check” preferred stock that our Board of Directors could use to implement a stockholder rights plan;

specify that special meetings of our stockholders can be called only by the affirmative vote of a majority of the entire Board of Directors ;

provide that the Board is expressly authorized to make, alter or repeal our A&R Bylaws;

provide that vacancies on the Board of Directors may be filled only by a majority of directors then in office, even though less than a quorum;

prohibit cumulative voting in the election of directors;

restrict the forum for certain litigation against us to Nevada and Texas;

restrict the forum for certain litigation against us to the federal district courts of the United States;

reflect the dual class structure of our Common Stock; and

establish advance notice requirements for nominations for election to our Board of Directors or for proposing matters that can be acted upon by stockholders at annual stockholder meetings.

In addition, after certain events specified in the A&R Charter, we will be subject to Nevada’s statutes regarding combinations with interested stockholders. These provisions may prohibit large stockholders, in particular those owning 10% or more of the voting power of our outstanding voting stock, from merging or combining with us for a period of time.

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Risks Related to Operating as a Public Company

We may be required to incur significant costs and require significant management resources to evaluate our internal control over financial reporting as required under Section 404 of the Sarbanes-Oxley Act, and any failure to comply or any adverse result from such evaluation may have an adverse effect on our stock price.

As a smaller reporting company as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we are required to evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”). Section 404 requires us to include an internal control report with our Annual Report on Form 10-K. This report must include management’s assessment of the effectiveness of our internal control over financial reporting as of the end of the fiscal year. This report must also include disclosure of any material weaknesses in internal control over financial reporting that we have identified. Failure to comply, or any adverse results from such evaluation could result in a loss of investor confidence in our financial reports and have an adverse effect on the value of our Common Stock.

Achieving continued compliance with Section 404 may require us to incur significant costs and expend significant time and management resources. No assurance can be given that we will be able to fully comply with Section 404 or that we and our independent registered public accounting firm would be able to conclude that our internal control over financial reporting is effective at fiscal year-end. As a result, investors could lose confidence in our reported financial information, which could have a material adverse effect on the value of our Common Stock, as well as subject us to civil or criminal investigations and penalties. In addition, our independent registered public accounting firm may not agree with our management’s assessment or conclude that our internal control over financial reporting is operating effectively.

We may not be able to meet the internal control reporting requirements imposed by the SEC, and any such failure could result in a possible decline in the price of our common stock and our inability to obtain future financing.

As directed by Section 404 of the Sarbanes-Oxley Act, the SEC adopted rules requiring each public company to include a report of management on the company’s internal controls over financial reporting in its annual reports. Although the Dodd-Frank Wall Street Reform and Consumer Protection Act exempts companies with a public float of less than $75 million from the requirement that our independent registered public accounting firm attest to our financial controls, this exemption does not affect the requirement that we include a report of management on our internal control over financial reporting and does not affect the requirement to include the independent registered public accounting firm’s attestation if our public float exceeds $75 million.

Our financial reporting function and system of internal controls may be less developed in certain respects than those of similar companies and may not provide our management with as much or as accurate or timely information. Effective internal control over financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Prior to the Merger, our management has not performed an assessment of the effectiveness of our internal control over financial reporting, and our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. However, Whitley Penn LLP, the independent registered public accounting firm of the Company, identified the following deficiencies in the Company’s internal control over financial reporting in connection with their audit of the consolidated financial statements of the Company as of and for the year ended December 31, 2025:

the overall control environment does not provide for proper control design;

there are minimal personnel and therefore minimal controls designed or operating properly;

the control environment lacks segregation of duties between processes;

lack of written policies and procedures such as formal employee handbook, code of conduct, job descriptions, formal strategic plan, or budget;

no formal review process related to account reconciliations, journal entries, or closing processes;

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no formal and documented with evidence process for reviewing and finalizing financial statements, thus, several adjusting entries were required to correct material misstatements of the financial statements;

the IT control environment was not properly designed or operating; and

several individuals at the Company had access to the accounting software, including administrative rights, inappropriate for their role at the company.

These weaknesses and deficiencies have not yet been fully remedied.

While we expect to expend significant resources in developing the necessary documentation and testing procedures required by Section 404 of the Sarbanes-Oxley Act, there is a risk that we may not be able to comply timely with all of the requirements imposed by this rule. Additionally, during the course of documenting and testing our internal control procedures, in the event that we identify weaknesses and deficiencies in our internal control over financial reporting, and fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented, or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404. Regardless of whether we are required to receive a positive attestation from our independent registered public accounting firm with respect to our internal controls, our failure to implement and maintain effective internal controls over financial reporting could result in errors in our financial statements that could result in a restatement of our financial statements, cause us to fail to meet our reporting obligations and cause investors to lose confidence in our reported financial information, which may result in volatility in and a decline in the market price of the Class A Common Stock and our ability to obtain equity or debt financing as needed could suffer. Ineffective internal control over financial reporting could also expose us to increased risk of fraud or misuse of corporate assets and subject us to potential regulatory investigations and civil or criminal sanctions. We may also be required to restate our financial statements from prior periods.

Further, in the event that our independent registered public accounting firm is unable to rely on our internal controls in connection with its audit of our financial statements, and in the further event that it is unable to devise alternative procedures in order to satisfy itself as to the material accuracy of our financial statements and related disclosures, it is possible that we would be unable to file our Annual Report on Form 10-K with the SEC, which could also have a material adverse effect on the market for and the market price of our Common Stock and our ability to secure additional financing as needed.

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

On December 30, 2025, the Company entered into and completed an Agreement and Plan of Merger by and among the Company, Merger Sub, Independence Power and Independence Investors, pursuant to which Merger Sub merged with and into Independence Power (the “Merger”), with Independence Power continuing as the surviving company and a wholly owned subsidiary of the Company. The Merger was completed in a simultaneous sign and close transaction.

The Merger was accounted for as a “reverse merger,” and Independence Power was deemed to be the accounting acquirer in the Merger. Independence Power was formed on October 22, 2025, for the purpose of acquiring all of the equity interests in Kyma Batteries, and has had no operations prior to completion of its acquisition of Kyma Batteries effective November 1, 2025. Consequently, the financial condition, results of operations and cash flows discussed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations discussed below are those of Kyma Batteries. References herein to the” Company” and to “Independence Power” include Kyma Batteries, unless the context otherwise requires.

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Objective

The objective of our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is to provide users of our financial statements with the following:

A narrative explanation from the perspective of management of our financial condition, results of operations, cash flows, liquidity and certain other factors that may affect future results;

Useful context to the financial statements; and

Information that allows assessment of the likelihood that past performance is indicative of future performance.

This MD&A is provided as a supplement to, and should be read together with, the Company’s audited consolidated financial statements for the fiscal years ended December 31, 2025 and 2024.

Overview

The Company is an energy technology company focused on software-enabled control and management of Battery Energy Storage Systems (“BESS”) deployed at unconventional oil and gas facilities. The Company’s strategy is to support the electrification of compression stations and related upstream infrastructure by integrating BESS into existing power configurations that may include diesel-fueled generators, field gas-fired generators and, where available, utility grid interconnections. The Company’s initial geographic focus is the Permian Basin, located in western Texas and southeastern New Mexico, with potential deployment in other United States basins and selected international markets over time.

Substantially all of the revenue generated by the Company in the year ended December 31, 2025 related to the installation of a battery software management system on the BESS Fleet (101 BESS units representing approximately 241 megawatts of nameplate capacity) acquired by the Cooperative from GridCore. We refer to the installation of the battery software management system on the BESS Fleet as the “GridCore Installation Project.” The Company delivered its battery software management system installation on the GridCore Installation Project pursuant to the GridCore Agreement, and GridCore in turn delivered the entire system to the Cooperative, as end-user. The Company does not own BESS equipment. Instead, capital investment in BESS is expected to be undertaken by the Cooperative and other asset owners serviced by the Company.

While the Company recognized a substantial amount of revenue in connection with the GridCore Installation Project on the BESS Fleet, it is uncertain whether the Company will generate revenues from similar installation projects in the future. Therefore, you should not assume that the Company will generate such revenue from installation projects in the future. See “Item 1A. Risk Factors – We recognized a substantial amount of revenue on the GridCore Installation Project, most of it in the form of a promissory note, but we expect our revenues in the future to be primarily related to servicing BESS, and there can be no assurance that we will be able to enter into similar installation contracts in the future.”

The Company’s revenues in the future are expected to be derived primarily from software license and subscription fees and related services, and, in some cases, from performance-based fees. Additionally, it is expected that the Company and other service providers will provide field operations. For example, the Company has entered into the Asset Management Agreement with the Cooperative, effective October 1, 2025, pursuant to which the Company provides administrative, monitoring, advisory and consulting services, including quarterly business analysis, daily operations of the BESS units, maintenance services, marketing services, customer support for end customers, marketing services and negotiation of rental agreements with end customers. Under the Asset Management Agreement, the Cooperative is obligated to pay to the Company on a quarterly basis an amount calculated as a percentage, to be agreed per the terms of the Asset Management Agreement, of the aggregate gross rental fees that the Cooperative actually receives under all rental agreements with end customers, subject to an aggregate maximum amount. Such fee shall not be less than $5,000 per month per BESS unit (initially, 101 units, with three in reserve). If the parties cannot agree on the percentage and maximum amount of the fee, such terms will be determined by binding arbitration. See “Item 1. Business – Products and Services – Program Management Engagement Related to PaaS Activities.”

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As of the date of this Annual Report, the Cooperative, through its subsidiary DBD Express, acquired the initial BESS Fleet, and the Software Platform is expected to be used on that fleet. The timing and scale of deployments of the BESS Fleet units will significantly influence the Company’s near-term operating results. To the extent we are not successful in deploying a significant percentage of the BESS Fleet, our operating results and financial position will be adversely affected.

Basis of Presentation

Because Independence Power is treated as the accounting acquirer, and because Independence Power had no operations prior to its acquisition of Kyma Batteries effective November 1, 2025, the following discussion refers to the historical operations of Kyma Batteries. Kyma Batteries has historically operated as a development-stage enterprise with limited revenue prior to the three months ended September 30, 2025.

Prior to the Merger, the Company’s fiscal year ended on July 31 of each year. Independence Power’s and Kyma Batteries’ fiscal years each end on December 31 of each year. In connection with the Merger and the Company’s acquisition of Independence Power, the Company changed its fiscal year end to December 31.

Kyma Batteries is organized as a limited liability company and, as a wholly disregarded entity for federal tax purposes, its operation results flowed through to its sole member for inclusion in its income tax returns. Accordingly, Kyma Batteries incurred no income tax expense for the periods covered by its financial statements included herein. However, the Company will be subject to income tax in respect of Independence Power’s and Kyma Batteries’ consolidated operations after the closing of the Merger.

Key Factors Affecting Results

Key factors that will affect our results of operations and financial condition include:

Pace and extent of BESS deployment and utilization by the Cooperative and its patron members, and by other BESS asset owners of their systems;

Independence Power’s ability to win new contracts to provide its management services to other BESS asset owners;

Execution and pricing of commercial arrangements for software and services, including the outcome of negotiations with the Cooperative of the percentage pricing model under the Asset Management Agreement;

Investment in software development, integration capabilities and personnel;

Dependence on a limited number of counterparties (including the Cooperative, Independence TX and a small group of exploration and production and midstream customers);

Any increases in headcount or other costs necessary to support delivery of services to the Cooperative under the Asset Management Agreement and to other customers in the future;

Regulatory and tax considerations affecting the Cooperative’s and other BESS asset owners’ programs (See “Item 1A. Risk Factors – Our business and customer demand for our offerings depends in large part on government incentives and/or regulations relating to the use of renewable energy and/or energy storage”); and

Macroeconomic and industry conditions in the oil and gas sector, including commodity prices and capital spending levels.

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In addition, as a consequence of the Merger, the Company’s operations have been materially expanded, which will require the Company to hire additional personnel and implement and apply procedures and processes to Independence Power and its operations in order to address public company regulatory requirements and customary practices. The Company expects to incur significant additional annual expenses as a result.

Results of Operations

To date, Independence Power, through Kyma Batteries, has generated revenue only from the GridCore Installation Project. Future revenue is expected to be generated by Independence Power and to be derived primarily from software license and subscription fees and related services, and, in some cases, from performance-based fees. Operating expenses have consisted primarily of cost of sales, employment, research and development (“R&D”) and general and administrative (“G&A”) costs. The Company reported net income of $68,888,442 for the year ended December 31, 2025 and a net loss of $2,758,042 for the year ended December 31, 2024.

As the BESS Fleet is commissioned and deployed, the Company expects its revenue mix to shift toward recurring software license and subscription fees and related services, with potential performance-based components. The timing and amount of revenue recognized will depend on the specific terms of the Company’s contracts, including whether fees are structured as fixed license fees, usage-based charges, shared-savings components or a combination thereof, and on the utilization patterns of the BESS units.

Comparison of Year Ended December 31, 2025 and 2024

Revenue

We recognized $97.2 million of revenue in the year ended December 31, 2025. We did not recognize any revenue in the year ended December 31, 2024. All of the revenue recognized in the year ended December 31, 2025 was realized under the Master Supply and Services Agreement with GridCore dated September 10, 2025 and related to the installation of the battery software management system on the Bess Fleet. Approximately $10.6 million of this revenue was received in cash during the period, and the remaining $86.6 million in revenue was received in the form of the GridCore Note. There can be no assurances that we will collect all, or any, payments under the GridCore note. See “Item 1A. Risk Factors – We may not receive payments under the GridCore Note” and “— We may not be able to fully realize the value of the collateral securing the GridCore Note or the Cooperative Note.”

Cost of Sales and Gross Profit

We recognized cost of sales of $2.5 million in the year ended December 31, 2025. All of the cost of sales recognized in the in the year ended December 31, 2025 was paid to an affiliate, ITX MicroGrid Development LLC for contract services rendered as part of the Administrative Services Agreement. We did not recognize any cost of sales in the year ended December 31, 2024.

Employment Expense

Employment expense was $688,325 in the year ended December 31, 2025, representing an approximately 9.8% decrease from $762,784 in the year ended December 31, 2024. Employment expense reflects headcount of approximately five and six full-time equivalent employees during the years ended December 31, 2025 and 2024, respectively.

Research and Development Expense

Research and development expense was $1,918,812 in the year ended December 31, 2025, representing an approximately 76.8% increase from $1,085,480 in the year ended December 31, 2024. The increase in research and development expense primarily reflects additional costs incurred in scaling the Software Platform.

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General and Administrative Expense

General and administrative expense was $6,362,672 in the year ended December 31, 2025, representing an approximately 599.3% increase from $909,804 in the year ended December 31, 2024. The increase in general and administrative expense primarily reflects expense under a management and consulting services agreement with an affiliate of $4,500,000 ($500,000 per month), which was terminated effective September 30, 2025, and additional lease expense under a new lease of $600,000 ($50,000 per month) with an affiliate commencing January 1, 2025, which was subsequently renewed on January 1, 2026 for an additional year. The Company also incurred additional general and administrative costs in 2025 related to the Merger.

Following completion of the Merger, the Company entered into the Administrative Services Agreement, which is expected to result in increased general administrative costs related to the increased scope of operations and applicable regulatory requirements as a public reporting company. See “Item 7. Certain Relationships and Related Transactions, and Director Independence – Relationships with Independence TX, Independence Power and the Cooperative.”

Tax

We incurred $17,941,976 in income tax expense in the year ended December 31, 2025 as a result of the change in tax status. The Company was organized as a limited liability and, as a wholly disregarded entity for federal tax purposes, incurred no income tax expense for the year ended December 31, 2024.

Liquidity and Capital Resources

Historically, the Company has funded operations through equity contributions from its owner and has had limited revenue. As of December 31, 2025, the Company had cash and cash equivalents of $1,576,367, a note receivable of $86,800,000, of which $21,650,000 is due within one year, and total liabilities of $19,355,914, of which $17,941,976 was related to a net deferred tax liability as a result of the GridCore Note. The Company also has a line of credit agreement with Independence Investors, our majority shareholder, which allows for borrowings up to $4,000,000 for working capital needs.

GridCore Note

At December 31, 2025, the Company’s principal asset was the $86.6 million GridCore Note, issued by GridCore to Kyma Batteries in connection with entry into the GridCore Agreement. The GridCore Note pays semi-annual interest payments at a rate of 4.0% per annum, beginning March 10, 2026, and four equal quarterly principal payments of $21.65 million beginning December 10, 2026, with the final payment due on September 10, 2027. The Company received the first interest payment of approximately $1.7 million under the GridCore Note on March 10, 2026. GridCore may prepay all or a portion of the outstanding principal amount under the GridCore Note at any time and from time to time without premium or penalty. From and after the occurrence and during the occurrence of any event of default under the GridCore Note, the rate of interest on the entire then-outstanding principal amount will increase to 12.0% per annum and Kyma Batteries may declare the entire unpaid principal amount, together with all accrued and unpaid interest, to be immediately due and payable. Such events of default include failure to pay principal or interest, breach of covenants, breach of representation, cross default under the GridCore Agreement or the GridCore Security Agreement, or an insolvency event.

The GridCore Note is secured by the security agreement, dated as of September 10, 2025, by and between GridCore and Kyma Batteries (the “GridCore Security Agreement”). Pursuant to terms of the GridCore Security Agreement, GridCore has pledged a broad range of assets, including its accounts, equipment, intellectual property and inventory, the DBD Express Note, its rights under the DBD Express Security Agreement (as defined below) and the Cooperative Guarantee described below, certain other assets and proceeds from all of the foregoing. Additionally, GridCore assigned to Kyma Batteries all of GridCore’s right, title, and interest in and to, including all proceeds received under the DBD Express Note described below, any and all such collateral.

In connection with the delivery by GridCore to DBD Express of the BESS Fleet, DBD Express issued GridCore the DBD Express Note in the principal amount of $193.42 million, which pays semi-annual interest payments at a rate of the applicable federal rate plus 6.0% per annum, beginning March 10, 2026, and four equal quarterly payments of $48.355 million beginning February 10, 2027, with the final payment due on September 10, 2027. Pursuant to the terms of the DBD Express Note, DBD Express granted to GridCore a first priority security interest in and to all of DBD Express’ right, title, and interest in, to and under the BESS Fleet and related collateral. Further, the Cooperative, DBD Express and GridCore entered into a continuing guaranty agreement (the “Cooperative Guarantee”), pursuant to which the Cooperative absolutely, unconditionally and irrevocably guaranteed to GridCore the full and prompt payment of all obligations of DBD Express to GridCore.

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In March 2026, the Company received a scheduled cash interest payment of approximately $1.7 million under the GridCore Note.

There can be no assurances that we will collect all, or any, payments under the GridCore Note. See “Item 1A. Risk Factors – We may not receive payments under the GridCore Note” and “—We may not be able to fully realize the value of the collateral securing the GridCore Note.”

The Company’s primary future cash requirements are expected to include:

funding operating losses until sufficient scale in software and services revenues is achieved;

supporting software development, integration and support activities;

hiring and retaining personnel in engineering, operations and corporate functions; and

satisfying working capital needs, including accounts receivable and payables associated with software and services contracts.

Because the Company does not expect to fund BESS equipment purchases, its capital needs are primarily operating in nature. Following the business combination, sources of liquidity consist of existing cash and cash equivalents, cash flows from operations, receipt of interest and principal payments on the GridCore Note and any future capital raised through equity or debt financing.

Management believes that existing cash and cash equivalents, together with expected cash flows from operations and payment of principal and interest on the GridCore Note, will be sufficient to meet anticipated operating requirements for at least twelve months from the date of this Annual Report. Any such assessment should be read in conjunction with any going concern disclosures in the Company’s financial statements.

Cash Flows

Net cash used in operating activities has primarily reflected net losses, partially offset by non-cash charges and changes in working capital. Net cash used in investing activities has been limited and has consisted primarily of capitalized software development costs, if any, and purchases of property and equipment. Net cash provided by financing activities has reflected equity contributions from owners.

The Company expects cash used in operating activities to increase in absolute terms in the near term as it invests in scaling the Software Platform and public-company infrastructure, partially offset by any increases in revenue.

Contractual Obligations and Off-Balance Sheet Arrangements

The Company’s contractual obligations as of December 31, 2025, consist primarily of lease commitments, service and support contracts and software and cloud services agreements, as described in the notes to its financial statements. The Company does not currently have any material off-balance sheet arrangements, as such term is defined in Item 303 of Regulation S-K.

While the Company expects to enter into additional commercial agreements with the Cooperative, Independence TX and other counterparties, including software license, maintenance and service agreements, such arrangements are not expected to create significant fixed capital commitments with respect to BESS equipment, as ownership and financing of such equipment will reside with the Cooperative and other asset owners.

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Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures. The Company considers an accounting policy to be critical if it requires significant management judgment and if different judgments could reasonably be expected to result in materially different financial results.

Critical accounting policies and estimates that are expected to be particularly important to the Company’s financial reporting include:

Revenue recognition, including identification of performance obligations in software and services contracts, allocation of transaction price to those obligations, determination of whether the Company acts as principal or agent in arrangements involving multiple parties and timing of revenue recognition for license, subscription and performance-based fees;

Capitalization of software development costs, including the determination of when technological feasibility is established and which costs qualify for capitalization; and

Income taxes, including the assessment of valuation allowances on deferred tax assets.

A more detailed description of the Company’s critical accounting policies and estimates is included in the notes to its financial statements.

Recent Developments

Effective February 7, 2026, the Company completed the Forward Split (as defined herein). See “Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.”

Effective March 1, 2026, the Company entered into a line of credit agreement with Independence Investors that allows for advances up to $4 million at 4% interest, with all outstanding principal and unpaid interest due on April 30, 2027.

In March 2026, the Company received a scheduled cash interest payment of approximately $1.7 million under the GridCore Note.

Effective March 27, 2026, the Company entered into the ASA Agreement with Rincon, a related party, whereby Rincon will provide administrative support services to the Company at $30,000 per month plus out-of-pocket expenses. The ASA Agreement can be terminated without penalty upon 30 days’ written notice.