SunPower Inc. (SPWR)

CIK: 0001838987. SIC: 1700 Construction - Special Trade Contractors. Latest 10-K as of: 2026-04-14.

SIC breadcrumb: Construction > SIC Major Group 17 > SIC 1700 Construction - Special Trade Contractors

SEC company page: https://www.sec.gov/edgar/browse/?CIK=1838987. Latest filing source: 0001213900-26-043623.

Selected Fundamentals

Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-04-14. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001838987.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

Flow metrics use full-year FY periods from 10-K/10-K/A filings; balance-sheet metrics use FY-end instants. Free cash flow = operating cash flow - capital expenditures. Missing metrics are omitted rather than fabricated.

Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

Financial Charts

Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-19. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001838987.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

Quarterly Charts

Macro Cross-References

• CPIAUCSL - Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
• UNRATE - Unemployment Rate
• FEDFUNDS - Federal Funds Effective Rate
• CES0500000003 - Average Hourly Earnings of All Employees, Total Private
• DFEDTARU - Federal Funds Target Range - Upper Limit
• DFEDTARL - Federal Funds Target Range - Lower Limit
• DGS3MO - Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
• DGS2 - Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
• DGS10 - Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
• DGS30 - Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
• T10Y2Y - 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
• CPILFESL - Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
• CPIUFDSL - Consumer Price Index for All Urban Consumers: Food
• CPIENGSL - Consumer Price Index for All Urban Consumers: Energy
• CUSR0000SAH1 - Consumer Price Index for All Urban Consumers: Shelter
• PCEPI - Personal Consumption Expenditures: Chain-type Price Index
• PCEPILFE - Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
• PPIACO - Producer Price Index by Commodity: All Commodities
• T10YIE - 10-Year Breakeven Inflation Rate
• U6RATE - Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
• PAYEMS - All Employees, Total Nonfarm
• CIVPART - Labor Force Participation Rate
• EMRATIO - Employment-Population Ratio
• UNEMPLOY - Unemployed
• CE16OV - Employment Level
• ICSA - Initial Claims
• JTSJOL - Job Openings: Total Nonfarm
• JTSQUR - Quits: Total Nonfarm
• GDPC1 - Real Gross Domestic Product
• A191RL1Q225SBEA - Real Gross Domestic Product: Percent Change from Preceding Period
• INDPRO - Industrial Production: Total Index
• TCU - Capacity Utilization: Total Index
• HOUST - New Privately-Owned Housing Units Started: Total Units
• PERMIT - New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
• RSAFS - Advance Retail Sales: Retail Trade
• PCE - Personal Consumption Expenditures
• DSPIC96 - Real Disposable Personal Income
• PSAVERT - Personal Saving Rate
• M2SL - M2
• BOPGSTB - U.S. International Trade in Goods and Services: Balance
• MSPUS - Median Sales Price of Houses Sold for the United States
• HSN1F - New One Family Houses Sold: United States
• RHORUSQ156N - Homeownership Rate in the United States
• TTLCONS - Total Construction Spending: Total Construction in the United States
• RRVRUSQ156N - Rental Vacancy Rate in the United States
• TOTALSL - Total Consumer Credit Owned and Securitized
• REVOLSL - Revolving Consumer Credit Owned and Securitized
• DRCCLACBS - Delinquency Rate on Credit Card Loans, All Commercial Banks
• GDP - Gross Domestic Product
• GPDI - Gross Private Domestic Investment
• GCE - Government Consumption Expenditures and Gross Investment
• PCEC - Personal Consumption Expenditures
• NETEXP - Net Exports of Goods and Services
• GFDEBTN - Federal Debt: Total Public Debt
• GFDEGDQ188S - Federal Debt: Total Public Debt as Percent of Gross Domestic Product
• FYFSD - Federal Surplus or Deficit
• FGRECPT - Federal Government Current Receipts
• FGEXPND - Federal Government: Current Expenditures
• MANEMP - All Employees, Manufacturing
• USCONS - All Employees, Construction
• USTRADE - All Employees, Retail Trade
• USFIRE - All Employees, Financial Activities
• USGOVT - All Employees, Government
• AWHAETP - Average Weekly Hours of All Employees, Total Private
• DGORDER - Manufacturers' New Orders: Durable Goods
• NEWORDER - Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft
• BUSINV - Total Business Inventories
• EXPGS - Exports of Goods and Services
• IMPGS - Imports of Goods and Services
• IR - Import Price Index (End Use): All Commodities
• PPIFIS - Producer Price Index by Commodity: Final Demand

Latest quarter (10-Q)

Latest 10-Q source: 0001213900-26-059082.

Extracted from Part I Item 2 to the first post-MD&A boundary after HTML sanitization. Confidence: high. Filing date: 2026-05-19. Report date: 2026-03-29.

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

You
should read the following discussion and analysis of our financial condition and results of operations together with the unaudited condensed
consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated
financial statements and related notes included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on
April 30, 2025, and related management’s discussion and analysis in Item 7 of the Annual Report on Form 10-K. This discussion contains
forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below.
Please also see the section titled “Special Note Regarding Forward-Looking Statements.”

Overview

SunPower
Inc. is a residential solar and energy services company headquartered in Orem, Utah. We operate a technology-enabled platform that supports
a national network of sales partners, dealers, and installation professionals to deliver solar energy systems, battery storage solutions,
and related services to homeowners and homebuilders throughout the United States.

We
fulfill our customer contracts by using in-house installation experts and by engaging with local construction specialists. We manage
the customer experience and complete all pre-construction activities prior to delivering build-ready projects including hardware, engineering
plans, and building permits to our builder partners. We manage and coordinate this process through our proprietary software system.

During
2025 and through the thirteen week period ended March 29, 2026 we significantly reshaped our business through a series of strategic acquisitions,
including the acquisition of Sunder Energy, LLC (“Sunder”), Ambia Energy LLC (“Ambia”) and Cobalt Power Systems,
Inc. (“Cobalt”). These acquisitions expanded our geographic footprint, dealer network, installation capacity, and national
sales presence. The operating results in the current quarter reflect the integration and ongoing operations of these acquired businesses.

As
further discussed below and in Note 16 – Segment Information to our unaudited condensed consolidated financial statements,
we have three reportable segments: Residential Solar Installation, New Homes Business and Dealer.

There
is substantial doubt about our ability to continue as a going concern within one year after the date that the unaudited condensed consolidated
financial statements are issued. The unaudited condensed consolidated financial statements included in this Quarterly Report on Form
10-Q have been prepared assuming our Company will continue to operate as a going concern, which contemplates the realization of assets
and settlement of liabilities in the normal course of business. They do not include any adjustments to reflect the possible future effects
on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty
related to our ability to continue as a going concern. 

Recent
Developments

Acquisitions

We
continued the integration of recent acquisitions of Sunder and Ambia into our operating platform. In the thirteen week period ended March
29, 2026, we acquired Cobalt for $9.7 million. Cobalt focuses on large premium renewable energy systems across residential, new home,
multifamily and commercial projects and its operating results will be incorporated into the New Homes reportable segment.

Critical
accounting policies and estimates

See
“Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Estimates”
and our consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December
28, 2025 for accounting policies and related estimates we believe are the most critical to understanding our consolidated financial statements,
financial condition and results of operations and which require complex management judgment and assumptions, or involve uncertainties.
These critical accounting estimates are revenue recognition accounting and accounting for business combinations. There have been no changes
to our critical accounting estimates or their application since the date of our Annual Report on Form 10-K for the fiscal year ended
December 28, 2025.

46

Results
of operations

We
have derived the following data from our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report
on Form 10-Q. This information should be read in conjunction with our unaudited condensed consolidated financial statements and related
notes included elsewhere in this Quarterly Report on Form 10-Q. The results of historical periods are not necessarily indicative of the
results of operations for any future period.

Thirteen-weeks
ended March 29, 2026 compared to the thirteen weeks ended March 30, 2025

The
following table sets forth our unaudited statements of operations from operations for the thirteen weeks ended March 29, 2026, and March
30, 2025 (in thousands):

Thirteen Weeks Ended

(in thousands)

March 29,

2026

March 30,

2025

$

Change

%

Change

Revenues

$

72,793

$

78,413

$

(5,620

)

(7

)%

Cost of revenues

28,106

51,037

(22,931

)

(45

)%

Gross (loss) profit

44,687

27,376

17,311

63

%

Gross margin %

61

%

35

%

Operating expenses:

Sales commissions

28,564

7,684

20,880

272

%

Sales and marketing

4,993

8,522

(3,529

)

(41

)%

General and administrative

30,325

14,896

15,429

104

%

Total operating expenses

63,882

31,102

32,780

105

%

Loss from operations

(19,195

)

(3,726

)

(15,469

)

415

%

Interest expense(1)

(6,924

)

(6,041

)

(883

)

15

%

Interest income

—

3

(3

)

(100

)%

Other non-operating income, net(2)

30,761

14,576

16,185

111

%

Income from operations before taxes

4,642

4,812

(170

)

(4

)%

Income tax benefit

608

—

608

*

Net income

$

5,250

$

4,812

$

438

9

%

*

Percentage
change is not meaningful.

(1)

Includes interest expense and amortization of debt issuance costs to
related party of $2.3 million and $1.4 million in the thirteen-weeks ended March 29, 2026 and March 30, 2025, respectively.

(2)

 Includes
the following gains and (losses) with related parties (in millions):

Thirteen
Weeks Ended

March
29,

2026

March
30,

2025

Change
in fair value of derivative liabilities

$

7.5

$

3.7

Change
in fair value of forward purchase agreement liabilities

—

0.1

Other
income, net

—

0.1

Change
in fair value of SAFE Agreement

(0.2

)

—

Change
in fair value of Deferred Sunder Consideration

2.3

—

47

Revenues

We
disaggregate our revenues based on the following types of services (in thousands):

Thirteen Weeks Ended

March 29,

2026

March 30,

2025

$

Change

%

Change

Residential Solar Installation

$

31,541

$

36,504

$

(4,963

)

(14

)%

New Homes Business

14,625

41,909

(27,284

)

(65

)%

Dealer

26,627

—

26,627

*

Total revenues

$

72,793

$

78,413

$

(5,620

)

(7

)%

*

Percentage
change is not meaningful.

The
decrease in Residential Solar Installation was driven primarily by lower installation volumes, reflecting softer consumer demand due
to higher interest rates as a result of an increase in financing costs for residential solar. In addition, the phase out of certain residential
Investment Tax Credits (“ITCs”) passed in 2025 as part of the One Big Beautiful Bill in conjunction with fewer customers
qualifying for financing makes it harder for a homeowner to make the decision quickly. The decrease also reflects fewer system activations
as we continued to optimize our sales channels and focus on streamlining our operations to enhance its customer experience.

New
Homes Business revenues decreased primarily due to lower construction activity and selective solar integration volumes from homebuilder
partners, due to higher interest rates and higher labor costs thus driving the overall costs of the home to increase. While regulatory
requirements force investments in solar in certain regions and communities, the pace has slowed down due to affordability. In states
and communities where regulatory requirements for new builds will not impact the demand of solar installation, homebuilders are not abandoning
solar they are offering it as an option versus a spec home. Additionally, there was a backlog of jobs from the SunPower Businesses acquisition
in 2024, for certain large homebuilder projects that contributed meaningfully to the prior-year quarter which did not recur in the current
period as we are rebuilding our pipeline. We are also building this business which we acquired out of bankruptcy in 2024 as part of the
SunPower Businesses acquisition.

Dealer
revenues and costs in the thirteen week period ended March 29, 2026 are attributable to the acquisition of Sunder on September 24, 2025.

Cost
of revenues and gross margins

Thirteen Weeks Ended

March 29,

March 30,

$

%

2026

2025

Change

Change

Residential Solar Installation

$

18,011

$

22,615

$

(4,604

)

(20

)%

New Homes Business

9,961

28,422

(18,461

)

(65

)%

Dealer

134

—

134

*

Total cost of revenues

$

28,106

$

51,037

$

(22,931

)

(45

)%

Gross margin

61

%

35

%

*

Percentage
change is not meaningful.

Residential
Solar Installation cost of revenues decreased primarily attributable to lower installation activity resulting from softer consumer demand.
Higher interest rates increased financing costs for homeowners, and the expiration of certain ITCs reduced the economic incentive to
adopt residential solar. As a result, installation volumes declined, leading to lower associated material, labor, and subcontractor costs.

New
Homes Business cost of revenues decreased primarily driven by reduced solar installation option due to the demands of keeping home prices
down demanded by home buyers. Homebuilders slowed construction primarily reducing optional features due to elevated mortgage rates, affordability
pressures on buyers, and the reduced benefit of ITCs for solar-equipped new homes.

48

Sales
commissions

Thirteen
Weeks Ended

March
29,

2026

March
30,

2025

$

Change

%

Change

Residential
Solar Installation

$

6,553

$

6,667

$

(114

)

(2

)%

New
Homes Business

1,166

1,017

149

15

%

Dealer

20,845

—

20,845

*

Total
sales commissions

$

28,564

$

7,684

$

20,880

272

%

*

Percentage
change is not meaningful.

Residential
Solar Installation sales commissions decreased slightly primarily due to lower residential installation volumes. Softer consumer demand
driven by higher interest rates increased financing costs and the expiration of certain ITCs resulted in fewer closed sales, which reduced
commissionable activity.

New
Homes Business sales commissions increased modestly due to changes in the mix of homebuilder programs and compensation structures, including
higher per-unit commission rates on certain projects. Timing of community launches and sales cycles also contributed to the year-over-year
variance.

Sales
and marketing

Thirteen
Weeks Ended

March
29,

2026

March
30,

2025

$

Change

%

Change

Residential
Solar Installation

$

3,539

$

8,522

$

(4,983

)

(58

)%

New
Homes Business

876

—

876

*

Dealer

578

—

578

*

Total
sales and marketing

$

4,993

$

8,522

$

(3,529

)

(41

)%

*

Percentage
change is not meaningful.

Residential
Solar Installation sales and marketing expenses decreased reflecting reduced spending on lead generation, advertising, and promotional
programs as we scaled back customer-acquisition efforts in response to softer demand. Higher interest rates increased financing costs
for homeowners, and the expiration of certain ITCs reduced the economic incentive to adopt residential solar. As a result, we intentionally
moderated mark

[Excerpt truncated for page length; source filing is linked above.]

Latest 10-K MD&A

Extracted from Item 7 to the first post-MD&A boundary after HTML sanitization. Confidence: high. Filing date: 2026-04-14. Report date: 2025-12-28.

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

You
should read the following discussion and analysis of our financial condition and results of operations together with the consolidated
financial statements and related notes included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking
statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that
could cause or contribute to such differences include those identified below and those discussed in the section titled “Risk Factors”
included elsewhere in this Annual Report on Form 10-K. Please also see the section titled “Special Note Regarding Forward-Looking
Statements.”

Overview

SunPower Inc. is the rebranded name of Complete Solaria, Inc. The rebranding
was effective April 22, 2025 and our legal name change became effective on October 16, 2025. We are headquartered in Orem, Utah.

40

Our
Company was originally incorporated in Delaware as Complete Solar, Inc. on February 22, 2010. In 2022, Complete Solar, Inc. implemented
a holding company reorganization creating Complete Solar Holding Corporation (“Complete Solar Holding”) as successor to Complete
Solar, Inc. Complete Solar Holding then acquired The Solaria Corporation in November 2022 and we changed our name to Complete Solaria,
Inc. We created a technology platform to offer clean energy products to homeowners by enabling a national network of sales partners and
build partners. Our sales partners generate solar installation contracts with homeowners on our behalf. To facilitate this process, we
provide the software tools, sales support and brand identity to our sales partners, making them competitive with national providers.
This turnkey solution makes it easy for anyone to sell solar.

On
July 18, 2023, we consummated a series of merger transactions contemplated by an Amended and Restated Business Combination Agreement
entered into with wholly-owned subsidiaries of Freedom Acquisition I Corp. (“FACT”) (“Mergers”), equating to
a reverse recapitalization for accounting purposes. Under the reverse recapitalization of accounting, FACT was treated as the acquired
company for financial statement reporting purposes. This determination was based on us having a majority of the voting power of the post-combination
company, our senior management comprising substantially all of the senior management of the post-combination company, and our operations
comprising the ongoing operations of the post-combination company. Accordingly, for accounting purposes, the Mergers were treated as
the equivalent of a capital transaction in which we issued stock for the net assets of FACT. The net assets of FACT were stated at historical
cost, with no goodwill or other intangible assets recorded.

In October 2023, we completed the sale of our solar panel business.
On September 30, 2024, we acquired certain assets relating to the Blue Raven Solar business, New Homes business and Non-Installing Dealer
network (collectively the “SunPower Businesses”) from the SunPower Debtors, the successor entity in bankruptcy to SunPower
Corporation and its direct and indirect subsidiaries. The acquired SunPower Businesses sell products to residential customers and home
builders through a network of installing and non-installing dealers and resellers and internal sales team. On September 24, 2025, we completed
the acquisition of Sunder Energy, LLC, (“Sunder”), which contracts with customers for solar installations performed by third-party
installation companies through a dealer network. On November 21, 2025, we completed the acquisition of Ambia Energy LLC, (“Ambia”)
a residential solar energy system installer.

We
fulfill our customer contracts by using in-house installation experts and by engaging with local construction specialists. We manage
the customer experience and complete all pre-construction activities prior to delivering build-ready projects including hardware, engineering
plans, and building permits to our builder partners. We manage and coordinate this process through our proprietary software system.

There
is substantial doubt about our ability to continue as a going concern within one year after the date that the consolidated financial
statements are issued. The consolidated financial statements included in this Annual Report on Form 10-K have been prepared assuming
that we will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the
normal course of business. They do not include any adjustments to reflect the possible future effects on the recoverability and classification
of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a
going concern.

41

Growth
Strategy and Outlook

Our
growth strategy contains the following elements:

●

Increase revenue by
expanding installation capacity and developing new geographic markets – We continue to expand our network of partners who
will install systems resulting from sales generated by our sales partners. By leveraging this network of skilled builders in addition
to our in-house installation experts, we aim to increase our installation capacity in our traditional markets and expand our offering
into new geographies throughout the U.S. This will enable greater sales growth in existing markets and create new revenue in expansion
markets.

●

Increase revenue and
margin by engaging national-scale sales partners – We aim to offer a turnkey solar solution to prospective sales partners
with a national footprint. These include electric vehicle manufacturers, national home security providers, and real estate brokerages.
We expect to create a consistent offering with a single execution process for such sales partners throughout their geographic territories.
These national accounts have unique customer relationships that we believe will facilitate meaningful sales opportunities and low
cost of acquisition to both increase revenue and improve margin.

●

Increase revenue and
margin by executing on a battery storage opportunity – We have an opportunity to increase our revenue and margin in the
battery space through our partnership with Enphase. By providing homeowners with an option to include battery storage as part of
their solar system install, we believe there will be a greater need for battery storage as the demand and costs of energy will increase.

The
Mergers

We
entered into an Amended and Restated Business Combination Agreement with FACT, First Merger Sub, Second Merger Sub, and Solaria on October
3, 2022. The Merger was consummated on July 18, 2023. Upon the terms and subject to the conditions of the Merger, (i) First Merger Sub
merged with and into Complete Solaria with Complete Solaria surviving as a wholly-owned subsidiary of FACT (the “First Merger”),
(ii) immediately thereafter and as part of the same overall transaction, Complete Solaria merged with and into Second Merger Sub, with
Second Merger Sub surviving as a wholly-owned subsidiary of FACT (the “Second Merger”), and FACT changed its name
to “Complete Solaria, Inc.” and Second Merger Sub changed its name to “CS, LLC” and (iii) immediately after the
consummation of the Second Merger and as part of the same overall transaction, Solaria merged with and into a newly formed Delaware limited
liability company and wholly-owned subsidiary of FACT and changed its name to “The SolarCA LLC” (“Third Merger Sub”),
with Third Merger Sub surviving as a wholly-owned subsidiary of FACT (the “Additional Merger”, and together with the First
Merger and the Second Merger, the “Mergers”).

The
Mergers between Complete Solaria and FACT were accounted for as a reverse recapitalization. Under this method of accounting, FACT was
treated as the acquired company for financial statement reporting purposes. This determination was primarily based on the Company having
a majority of the voting power of the post-combination company, the Company’s senior management comprising substantially all of
the senior management of the post-combination company, and the Company’s operations comprising the ongoing operations of the post-combination
company. Accordingly, for accounting purposes, the Mergers were treated as the equivalent of a capital transaction in which Complete
Solaria issued stock for the net assets of FACT. The net assets of FACT were stated at historical cost, with no goodwill or other intangible
assets recorded.

42

Disposal
Transaction

In October 2023, we completed
the divestiture of our solar panel business to Maxeon (“Divestiture”), pursuant to the terms of the Disposal Agreement.
Under the terms of the Disposal Agreement, Maxeon agreed to acquire certain assets and employees of Complete Solaria, for an aggregate
purchase price of approximately $11.0 million consisting of 1,100,000 shares of Maxeon ordinary shares. We determined that the criteria
were met for discontinued operations classification as the divestiture represented a strategic shift in our business. In connection with
the Divestiture, we recognized a loss from discontinued operations of $1.1 million, $2.0 million and $173.4 million in the fiscal years
ended December 28, 2025, December 29, 2024 and December 31, 2023, respectively. We also sold all the Maxeon shares in the year ended
December 31, 2023, and recorded a $4.2 million loss on the sale of these shares in our consolidated statements of operations and comprehensive
loss.

Acquisitions

Certain
Assets of SunPower Debtors

On September 30, 2024, we acquired the SunPower Businesses for consideration
of $54.5 million which we financed through the issuance of $66.8 million of 7.0% senior unsecured convertible notes in September 2024.
These notes mature on July 1, 2029 and are convertible into shares of the Company’s common stock at the option of the holder at
a current conversion rate of $1.71 per share. The SunPower Businesses operated as a solar technology and energy services provider that
offered fully integrated solar, storage, and home energy solutions to customers in the United States through an array of hardware, software,
and “Smart Energy” solutions. This transaction was accounted for as a business combination under Accounting Standards Codification
(“ASC”) 805, Business Combinations.

Sunder
Energy LLC

On
September 24, 2025, we acquired all of the membership interests in Sunder Energy LLC (“Sunder”) for consideration of $57.8
million. We financed this transaction through (1) $20.7 million in cash, subject to certain working capital and other adjustments; (2)
a promissory note to the seller in the principal amount of $20.0 million (“Seller Note”); and (3) 10.0 million shares of
the Company’s common stock valued at $17.1 million (based on the $1.71 closing share price of the Company’s common stock
on September 24, 2025). We issued 3.3 million shares at the acquisition date and will issue the remining shares in two equal tranches
of 3.3 million shares at 12 months and 18 months following the date of acquisition. Sunder is a solar sales company. Sunder provides
a third-party solar energy sales force to initiate and execute contracts with customers throughout the United States. Sunder’s
sales force works with solar installation companies in which Sunder acts as the agent for each transaction entered. Sunder earns revenue
from contracts sold to customers for solar installations performed by third-party installation companies. We acquired Sunder as a strategic
acquisition to expand its overall market share and its penetration into more U.S. states. We accounted for this transaction as a business
combination under ASC 805.

Ambia
Energy LLC

On November 21, 2025, we acquired all of the membership interests in
Ambia Energy LLC (“Ambia”) for consideration of $33.4 million. We financed this acquisition through the issuance of 10.2 million
shares of our common stock with a fair value of $16.5 million on the date of acquisition and an agreement to issue an additional $16.9
million in shares of our common stock in two tranches with the final issuance on the 12-month anniversary of the Ambia closing. Ambia
is a residential solar energy system installer and operates in various markets throughout the United States.

43

Supply
Chain Constraints and Risk

The
global supply chain and our industry have experienced significant disruptions in recent periods. We have seen supply chain challenges
and logistics constraints increase, including shortages of panels, inverters, batteries and associated component parts for inverters
and solar energy systems available for purchase, which materially impacted our results of operations. These shortages and delays can
be attributed in part to the broader macroeconomic conditions and have been exacerbated by the conflicts in Ukraine and Israel. If any
of our suppliers of solar modules experienced disruptions in the supply of the modules’ component parts, for example semiconductor
solar wafers or inverters, this may decrease production capabilities and restrict our inventory and sales. In addition, we have experienced
and are experiencing varying levels of volatility in costs of equipment and labor resulting in part from disruptions caused by general
global economic conditions. While inflationary pressures have resulted in higher costs of products, in part due to an increase in the
cost of the materials and wage rates, these additional costs have been offset by the related rise in electricity rates.

We
cannot predict the full effects the supply chain constraints will have on our business, cash flows, liquidity, financial condition and
results of operations at this time due to numerous uncertainties. Given the dynamic nature of these circumstances on our ongoing business,
results of operations and overall financial performance, the full impact of macroeconomic factors, including the conflicts in Ukraine
and Israel, cannot be reasonably estimated at this time. In the event we are unable to mitigate the impact of delays or price volatility
in solar energy systems, raw materials, and freight, it could materially adversely affect our business, prospects, financial condition
and results of operations.

For
additional information on risk factors that could impact our results, please refer to “Risk Factors” located elsewhere
in this Annual Report on Form 10-K.

Key
Financial Definitions/Components of Results of Operations

Revenues

We
recognize revenue for the Residential Solar Installation and New Homes Business reportable segments when installation is substantially
complete, the system is capable of interconnection to the local power grid, and control has transferred to the customer.

Installation
activities—including system design, equipment delivery, installation, and grid interconnection—are treated as a single performance
obligation. For most contracts, revenue is recognized over time beginning upon installation, using an input method based on direct installation
costs. Installation costs incurred prior to this point are deferred.

Residential
Solar Installation revenue is generated through cash sales, third-party financing arrangements, and power purchase or lease structures.
Homeowners are the customers in cash and financing arrangements, while leasing partners are the customers in power purchase and lease
arrangements. New Homes Business revenue is primarily generated from sales to homebuilders, with limited lease arrangements recognized
upon system acceptance.

Revenue
is recorded at the transaction price, net of customer incentives and financing-related fees, and may include estimated variable consideration.
Deferred revenue represents amounts billed or collected in advance of performance. None of the Company’s arrangements contain a
significant financing component.

With
respect to our Dealer reportable segment, we earn revenue from contracts in which solar installations are performed by third-party installation
companies. In these arrangements, our performance obligation is to facilitate the transaction and arrange for installation services rather
than provide those services directly. As a result, we act as an agent and recognize revenue on a net basis, representing the fee retained
by us.

Dealer
revenue is recognized at a point in time when Permission to Operate (“PTO”) is obtained, which indicates that installation
is complete and the system is authorized for operation. These arrangements do not include significant financing components, and we do
not provide warranty services related to dealer-installed systems.

Costs
to Obtain and Fulfill Contracts

Our
costs to obtain and fulfill contracts, when recognized, associated with systems sales are expensed as sales commission and cost of revenue,
respectively. In addition, incentives we provide to our customers, such as discounts and rebates, are recorded net to the revenue we
have recognized on the solar power system.

44

Costs
of Revenues

Cost
of revenues is comprised primarily of cost of material, internal labor costs, third-party subcontractors, design services, engineering
personnel and employee-related expenses associated with permitting services, associated warranty costs, freight and delivery costs, depreciation,
amortization of internally developed software and amortization of developed technology. Cost of revenues from these services is recognized
when we transfer control of the product to the customer, which is generally upon installation.

Operating
Expenses

Sales
Commissions

Sales
commissions are direct and incremental costs of obtaining customer contracts. These costs are paid to internal sales teams and third-party
vendors who source residential customer contracts for the sale of solar energy systems.

Sales
and Marketing

Sales
and marketing expenses primarily consist of personnel related costs, including salaries and employee benefits, stock-based compensation,
and other advertising and promotional expenses. We expense certain sales and marketing, including promotional expenses, as incurred.

General
and Administrative

General
and administrative expenses consist primarily of personnel and related expenses for employees, in our finance, research, engineering,
and administrative teams including salaries, bonuses, payroll taxes, and stock-based compensation. It also consists of legal, consulting,
and professional fees, rent expenses pertaining to our offices, depreciation expense, business insurance costs and other costs.

Other
(Expense) Income, Net

Other
non-operating income, net

We
classify changes in the fair value of (i) derivative liabilities associated with our debt, (ii) warrant liabilities, (iii) Simple Agreements
for Future Equity (“SAFE”), and (iv) forward purchase agreements (“FPAs”) as non-operating gains and losses within
this category.

Critical
Accounting Estimates

Our
discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been
prepared in accordance with GAAP. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities,
revenue, expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe
to be reasonable under the circumstances. In many instances, we could have reasonably used different accounting estimates, and in other
instances, changes in the accounting estimates are reasonably likely to occur from period-to-period. Actual results could differ significantly
from our estimates. Our future financial statements will be affected to the extent that our actual results materially differ from these
estimates. For further information on all of our significant accounting policies, see Note 2 – Summary of Significant Accounting
Policies, to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

We
believe that policies associated with our revenue recognition and business combination have the greatest impact on our consolidated financial
statements. Therefore, we consider these to be our critical accounting policies and estimates.

45

Revenue
Recognition

Revenue
recognition involves significant judgment in determining the timing of control transfer, identification of the customer, estimation of
variable consideration, and measurement of progress toward completion. For the Residential Solar Installation and New Homes Business
segments, the Company’s performance obligation is the design and installation of a fully functioning solar energy system, which
includes design, equipment delivery, installation, and grid interconnection services. These activities are combined into a single performance
obligation.

Revenue
is generally recognized over time using an input method based on direct installation costs, beginning when installation is complete and
control of the system begins to transfer to the customer. This approach requires management to estimate total expected installation costs,
and changes in these estimates may impact the timing and amount of revenue recognized. Installation costs incurred prior to the transfer
of control are deferred.

For
certain New Homes Business lease arrangements, revenue is recognized at a point in time upon system acceptance. In arrangements involving
financing partners or leasing partners, judgment is required to determine the appropriate customer, which affects revenue timing and
presentation. Dealer segment revenue is recognized on a net basis at the point in time when Permission to Operate is obtained.

The
transaction price may include variable consideration, which is estimated using the most likely amount and constrained to amounts for
which a significant revenue reversal is not probable. Estimates are reassessed each reporting period, and changes are recognized prospectively.
Revenue is recorded net of customer incentives and does not include a significant financing component. Changes in assumptions related
to these estimates could materially affect reported revenue and deferred balances.

Dealer
revenue is recognized at a point in time when PTO is obtained, which indicates that installation is complete and the system is authorized
for operation. These arrangements do not include significant financing components, and we do not provide warranty services related to
dealer-installed systems.

 Accounting
for Business Combinations

We
record all acquired assets and liabilities, including goodwill, and other identifiable intangible assets at fair value. The initial recognition
of identifiable intangible assets, requires certain estimates and assumptions concerning the determination of the fair values and useful
lives. The judgments made in the context of the purchase price allocation can materially affect our future results of operations. Accordingly,
when valuing identifiable intangible assets, we obtain assistance from third-party valuation specialists. The valuations calculated from
estimates are based on information available at the acquisition date. Goodwill is not amortized but is subject to annual tests for impairment
or more frequent tests if events or circumstances indicate it may be impaired. Other intangible assets are amortized over their estimated
useful lives and are subject to impairment if events or circumstances indicate a possible inability to realize the carrying amount.

46

Recent
Accounting Pronouncements

A
discussion of recently issued accounting standards applicable to our Company is described in Note 2 – Summary of Significant
Accounting Policies, in the accompanying notes to the consolidated financial statements.

Results
of Operations

Fiscal
year ended December 28, 2025 (“2025”) compared to the fiscal year ended December 29, 2024 (“2024”)

In
this section, we discuss the results of our operations for fiscal 2025 compared to fiscal 2024. We discuss our cash flows and current
financial condition under “Liquidity and Capital Resources”.

The
following table sets forth our statements of operations data for the fiscal years ended December 28, 2025 and December 29, 2024, respectively.
We have derived this data from our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. This information
should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on
Form 10-K. The results of historical periods are not necessarily indicative of the results of operations for any future period. Within
the tables presented, percentages are calculated based on the underlying whole-dollar amounts and, therefore, may not recalculate exactly
from the rounded numbers used for disclosure purposes.

Fiscal Year Ended

December 28,

December 29,

$

%

(in thousands)

2025

2024

Change

Change

Revenues

$

300,000

$

108,742

$

191,258

176

%

Cost of revenues(1)

170,788

69,240

101,548

147

Gross profit

129,212

39,502

89,710

227

Gross margin %

43

%

36

%

Operating expenses:

Sales commissions

37,009

24,590

12,419

51

Sales and marketing(1)

29,030

6,827

22,203

325

General and administrative(1)

90,104

76,594

13,510

18

Total operating expenses

156,143

108,011

48,132

41

Loss from continuing operations

(26,931

)

(68,509

)

41,578

61

Interest expense(2)

(25,095

)

(16,223

)

(8,872

)

55

Interest income

3

19

(16

)

(84

)

Other non-operating income, net(3)

9,347

7,932

1,415

18

Gain on troubled debt restructuring(4)

—

22,337

(22,337

)

(100

)

Loss from continuing operations before taxes

(42,676

)

(54,444

)

11,768

22

Income tax (provision)

(1,578

)

—

(1,578

)

*

Net loss from continuing operations

$

(44,254

)

$

(54,444

)

$

10,190

19

47

(1)

Includes
stock-based compensation expense as follows (in thousands):

Fiscal Year Ended

December 28

December 29,

2025

2024

Cost of revenues

$

3,003

$

157

Sales and marketing

2,618

598

General and administrative

4,867

2,312

Total stock-based compensation expense

$

10,488

$

3,067

(2)

Includes
interest expense and amortization of debt discount costs with related parties of $5.7 million
and $7.6 million in 2025 and 2024, respectively.

(3)

Includes
the following related party transactions in 2025 (i) a gain of $3.5 million due to the change in the fair value of derivative
liabilities; and (ii) $0.1 million of other income due to a change in the fair value of a forward purchase agreement.

Includes
the following related party transactions in 2024; (i) $0.7 million of expense in connection with the conversion of SAFE Agreements
into shares of common stock and the change in the fair value of SAFE Agreements, (ii) $3.0 million of expense in connection with
the loss on issuance of a derivative liability and $0.3 million of income due to the change in the value of derivative liabilities,
and (iii) $0.1 million of income in connection with the change in the fair value of forward purchase agreements.

(4)

Gain
includes $12.5 million with a related party in 2024.

*

Percentage
change not meaningful.

Revenues

We
disaggregate our revenues based on the following reportable segments (in thousands):

Fiscal Year Ended

December 28,

December 29,

$

%

2025

2024

Change

Change

Residential Solar Installation

$

160,987

$

67,460

$

93,527

139

%

New Homes Business

124,595

41,282

83,313

202

Dealer

14,418

—

14,418

*

Total revenues

$

300,000

$

108,742

$

191,258

176

*

Percentage change not meaningful.

Residential
Solar Installation revenue increased primarily attributed to a full year of Solar Installation due to the acquisition of SunPower Businesses
at the beginning of our fourth quarter in fiscal year ended December 29, 2024. New Homes Business increased due to the sale of solar
system sales to home builders and the completion of backlog projects acquired with the SunPower Businesses. Dealer revenues are attributable
to the acquisition of Sunder.

Cost
of Revenues and Gross Margin

Fiscal Year Ended

December 28,

December 29,

$

%

2025

2024

Change

Change

Residential Solar Installation

$

88,400

$

45,266

$

43,134

95

%

New Homes Business

82,288

23,974

58,314

243

Dealer

100

—

100

—

Total cost of revenues

$

170,788

$

69,240

$

101,548

147

Gross Margin

43

%

36

%

*

Percentage change not meaningful.

48

Residential Solar Installation
cost of revenue increase is primarily attributed to a full year of Solar Installation as described above. New Homes Business cost of
revenue increased as a result of a full year of completing backlog and the inventory costs associated with each solar system sale. Cost
of revenues attributable to the Dealer network is attributable to the acquisition of Sunder.

The
increase in gross margins is attributed to operational efficiencies gained through the synergies created by consolidating the various
lines of business and streamlining direct overhead costs attributed to each solar installation.

Sales
Commissions

Fiscal Year Ended

December 28,

December 29,

$

%

2025

2024

Change

Change

Residential Solar Installation

$

26,298

$

23,388

$

2,910

12

%

New Homes Business

5,032

1,202

3,830

319

Dealer

5,679

—

5,679

*

Total sales commissions

$

37,009

$

24,590

$

12,419

51

*

Percentage change not meaningful.

Residential
Solar and New Homes Business sales commission increased from the prior fiscal year ended December 28, 2025 is primarily attributable
to the increase in revenue.

Sales
and Marketing

Fiscal Year Ended

December 28,

December 29,

$

%

2025

2024

Change

Change

Residential Solar Installation

$

25,154

$

6,827

$

18,327

268

%

New Homes Business

3,253

—

3,253

*

Dealer

623

—

623

*

Total sales & marketing

$

29,030

$

6,827

22,203

325

*

Percentage change not meaningful.

Residential
Solar Installation expense increased in fiscal 2025 compared to fiscal 2024 due to increase in overall headcount due to combined business
and increasing sales and marketing footprint. New Homes Business increased when compared to prior year primarily attributable to our
decision to invest in sales and marketing efforts in fiscal 2025.

General and Administrative

Fiscal Year Ended

December 28,

December 29,

$

%

2025

2024

Change

Change

Residential Solar Installation

$

58,597

$

57,641

$

956

2

%

New Homes Business

29,648

18,953

10,695

56

Dealer

1,859

—

1,859

*

Total general and administrative

$

90,104

$

76,594

$

13,510

18

*

Percentage change not meaningful.

49

Residential
Solar Installation expenses decreased as a result of declines in our legacy operations following a strategic resizing of this reportable
segment including reduction of personnel costs. New Homes Business increased due a full year of operations in fiscal 2025. Dealer reportable
segment expenses increased entirely attributable to our acquisition of Sunder.

Interest
Expense

Interest expense inclusive of amortization of debt issuance costs was
$25.1 million in fiscal 2025 and principally consisted of $20.4 million attributable to our 7.0% senior unsecured convertible notes and
$3.4 million attributable to our 12.0% senior unsecured convertible notes with the remainder attributable to interest expense on our other
obligations.

Interest
expense inclusive of amortization of debt issuance costs was $16.2 million in fiscal 2024 and principally consisted of (i) $5.5 million
related to our 7.0% senior unsecured convertible notes, (ii) $3.5 million related to our 12.0% senior unsecured convertible notes, (iii)
$5.8 million relating to obligations that were exchanged during fiscal 2024 for 12.0% senior unsecured convertible notes, and (iv) other
of $1.4 million.

Other
Non-Operating Income, Net

Other non-operating income, net, was $9.3 million in in fiscal 2025.
Other income principally consisted of $11.5 million of gains from changes in the fair value of derivative liabilities associated with
our 12.0% and 7.0% senior unsecured convertible notes and other non-cash income and other of $1.3 million. These gains were partially
offset by a $2.8 million increase in the fair value of our public, private placement and working capital warrants accounted for as liabilities,
$0.5 million increase in the fair value of our forward purchase agreements liabilities, and $0.2 million increase in the fair value of
a SAFE Agreement liability.

Other
non-operating income, net was $7.9 million in fiscal 2024. The amounts consisted primarily of a $34.0 million gain on remeasurement of
derivative liabilities associated with our 12.0% and 7.0% senior unsecured convertible notes, a $2.9 million net gain due to changes
in fair values of warrants accounted for as liabilities, a $0.6 million gain due to the change in the fair value of SAFE Agreements and
net other of $0.2 million partially offset by a $24.7 million loss on issuance of a derivative liabilities, $3.8 million of other financing
costs and $1.3 million loss on the conversion of SAFE Agreements.

Net
Loss from Continuing Operations

Our net loss from continuing operations in 2025, was $44.3 million, a decrease
in net loss of $10.1 million, as compared to a net loss from continuing operations of $54.4 million in 2024.

Liquidity
and Capital Resources

Sources
of Liquidity

Since inception, we have incurred
losses and negative cash flows from operations. We incurred net losses of $41.7 million and $56.5 million, in 2025 and 2024, respectively,
and had an accumulated deficit of $453.1 million and current debt of $24.3 million as of December 28, 2025. We had cash and cash equivalents
(excluding restricted cash) of $9.6 million as of December 28, 2025, which is held for working capital expenditures. We believe our operating
losses and negative operating cash flows will continue into the foreseeable future.

50

We finance our continuing
operations through the revenue we collect and through the issuance of debt and equity instruments. For expenses related to mergers and
acquisition and payments on our debt obligation we rely on sales of equity securities, the issuance of debt instruments, SAFE Agreements,
leases and cash generated from operations. Our cash equivalents are on deposit with major financial institutions. Our cash position raises
substantial doubt regarding our ability to continue as a going concern for 12 months following the issuance of the accompanying consolidated
financial statements. In the fiscal year ended December 28, 2025, we issued a $20.0 million Seller note and $22.0 million of 7.0% senior
unsecured convertible notes to finance our acquisition of Sunder. We also issued $7.0 million in 12.0% senior unsecured convertible notes
to entities related to our CEO in fiscal 2025 to finance our operations.

As of December 28, 2025, we had negative working capital, including
cash and cash equivalents, of $38.0 million.

Borrowings

Our
contractual debt obligations consist of the following principal amounts excluding unamortized debt issuance costs and accrued interest
(in thousands):

As
of

December
28,

December 29,

$

%

2025

2024

Change

Change

12.0% senior unsecured
convertible notes (1)

$

63,801

$

59,587

$

4,214

7

%

7.0% senior unsecured convertible
notes

87,293

79,800

7,493

9

Seller note – related party

20,000

—

20,000

*

Loan
with related party

1,500

1,500

—

*

Total
amount of debt outstanding

$

172,594

$

140,887

$

31,707

23

*

Not
meaningful.

(1)

In
connection with an exchange of debt in fiscal 2024 for $18.0 million of the principal amount
of the 12% senior unsecured convertible notes, we also capitalized all future interest (including
coupon interest, default interest and failure to file interest) associated with this portion
of the notes which amounts to $10.8 million and $13.6 million as of December 28, 2025 and
December 29, 2024, respectively. These amounts are included in the above table.

In the fiscal year ended December
28, 2025, we issued $7.0 million principal amount of 12.0% senior unsecured convertible notes to an entity controlled by our CEO, for
an aggregate related party principal balance of $25.0 million principal amount of the 12.0% senior unsecured convertible notes. In the
fiscal year ended December 28, 2025, we issued $22.0 million principal amount of 7% senior unsecured convertible notes and $14.7 million
principal amount of 7% senior unsecured convertible notes were converted into approximately 8.6 million shares of our common stock. We
pay interest on both the 7.0% and 12.0% senior unsecured convertible notes semi-annually on January 1 and July 1. The principal amount
of these senior unsecured convertible notes is due in full on July 1, 2029.

In September 2025, we issued the Seller note in the principal amount
of $20.0 million in connection with our acquisition of Sunder Energy LLC. Interest accrues under the Seller note at a rate of 7.0%. Principal
and interest are payable upon maturity on the earlier of May 15, 2026, subject to certain terms that defer the maturity date to September
30, 2026, depending on the amount of outstanding indebtedness under our Yorkville facilities.

51

Refer
to Note 10 – Borrowings and Derivative Liabilities, in Part II, Item 8 of this Annual Report on Form 10-K for more information
on our debt obligations.

We received a deposit of $2.0 million from the Rodgers Revocable Trust,
a party to our CEO, in the fiscal year ended December 28, 2025. In January 2026, we received an additional $1.3 million in proceeds from
the Rodgers Revocable Trust and together with the $2.0 million, we issued a convertible promissory note in the principal amount of $3.3
million (the “January 2026 Note”). The January 2026 Note will mature on July 1, 2029, unless earlier converted, redeemed or
repurchased. Interest on the January 2026 Note is payable semiannually in arrears on January1 and July 1 of each year, beginning on July
1, 2026.

Common
stock purchase agreement with White Lion Capital LLC (“White Lion”)

We
have a common stock purchase agreement with White Lion for an equity line of credit financing facility (“White Lion SPA”).
Pursuant to the White Lion SPA, we have the right, but not the obligation, to require White Lion to purchase, from time to time, up to
$30 million in aggregate gross purchase price of newly issued shares of our common stock, subject to the caps and certain limitations
and conditions set forth in the White Lion SPA, including terms that restrict our ability to issue shares of common stock to White Lion
that would result in White Lion beneficially owning more than 9.99% of our outstanding common stock. On August 14, 2024, we entered into
Amendment No. 2 to the White Lion SPA (collectively with the White Lion SPA “White Lion Amended SPA”). The White Lion Amended
SPA provides that we may notify White Lion to exercise our right to sell shares of our common stock by delivering an Hour Rapid Purchase
Notice. If we deliver an Hour Rapid Purchase Notice, we shall deliver to White Lion shares of our common stock not to exceed the lesser
of (i) five percent of the Average Daily Trading Volume on the date of an Hour Rapid Purchase Notice and (ii) 100,000 shares of common
stock. The closing of the transactions under an Hour Rapid Purchase Notice will occur one Business Day following the date on which the
Hour Rapid Purchase Notice is delivered. At such closing, White Lion will pay us the Hour Rapid Purchase Investment Amount equal to the
number of shares of our common stock subject to the applicable Hour Rapid Purchase Notice multiplied by the lowest traded price of our
common stock during the one-hour period following White Lion’s consent to the acceptance of the applicable Hour Rapid Purchase
Notice. Under this arrangement, we received proceeds of $6.7 million and $6.7 million in the years ended December 28, 2025 and December
29, 2024, respectively. Refer to Note 14 – Common Stock and Common Stock Warrants, in Part II, Item 8 of this Annual Report
on Form 10-K for more information on our lease obligations.

On
January 11, 2026, we and White Lion entered into Amendment No. 3 (“Amendment No. 3”) to the White Lion SPA. Amendment No.
3 extends the commitment period under the White Lion SPA (the “Commitment Period”) to the earlier of December 31,2027 and
the date on which White Lion has purchased an aggregate number of shares of our common stock equal to the Commitment Amount (as defined
below). Further, Amendment No. 3 increases, subject to approval by our stockholders, the commitment amount under the Purchase Agreement
to $55.0 million of shares of our common stock (the “Commitment Amount”), which we may elect to sell to White Lion pursuant
to the White Lion SPA, from time to time in our sole discretion, during the Commitment Period. As a result of our total sales of common
stock to White Lion as of January 12, 2026, we may receive up to an additional $48.5 million in gross proceeds after such date under
the White Lion Purchase Agreement (assuming the shares to be issued are sold at a price of $1.00 per share) if our stockholders authorize
the increase in the White Lion Commitment Amount to $55.0 million.

In
addition, Amendment No. 3 adds an option for us to submit three hour rapid purchase notices to White Lion that, if accepted by White
Lion and otherwise delivered in accordance with the Purchase Agreement, would enable us to sell shares of our common stock to White Lion
based on the lowest traded price of our common stock during the three-hour valuation period following White Lion’s written acceptance
of a three hour purchase notice.

52

Forward
Purchase Agreements

On and around July 13, 2023,
FACT entered into separate Forward Purchase Agreements (the “Forward Purchase Agreements”) with each of (i) Meteora
Special Opportunity Fund I, LP (“MSOF”), Meteora Capital Partners, LP (“MCP”) and Meteora Select Trading Opportunities
Master, LP (“MSTO”) (with MSOF, MCP, and MSTO collectively as “Meteora”); (ii) Polar Multi-Strategy Master
Fund (“Polar”), and (iii) Diametric True Alpha Market Neutral Master Fund, LP, Diametric True Alpha Enhanced Market Neutral
Master Fund, LP, and Pinebridge Partners Master Fund, LP (collectively, “Sandia”, and each of Meteora, Polar, and Sandia,
individually, an “FPA Investor”, and together, the “FPA Investors”), pursuant to which FACT (now SunPower (f/k/a
Complete Solaria, Inc.) following the closing of the Business Combination) agreed to purchase in the aggregate, on the date that was originally
24 months after the closing date of the Forward Purchase Agreements, up to 5,618,488 shares of common stock then held by the FPA Investors
(subject to certain conditions and purchase limits set forth in the Forward Purchase Agreements). Pursuant to the terms of the Forward
Purchase Agreements, each FPA Investor further agreed not to redeem any of the FACT Class A Ordinary Shares owned by it at such time.
The per price at which the FPA Investors have the right to sell the shares to us on the original maturity date will not be less than $5.00
per share.

On December 18, 2023, we and
each FPA Investor entered into separate amendments to the Forward Purchase Agreements (the “First Amendments”). The First
Amendments lower the reset floor price of each Forward Purchase Agreement from $5.00 to $3.00 and allow us to raise up to $10.0 million
of equity from existing stockholders without triggering certain anti-dilution provisions contained in the Forward Purchase Agreements;
provided, the insiders pay a price per share for their initial investment equal to the closing price per share as quoted on the Nasdaq
on the day of purchase; provided, further, that any subsequent investments are made at a price per share equal to the greater of (a) the
closing price per share as quoted by Nasdaq on the day of the purchase or (b) the amount paid in connection with the initial investment.

On May 7 and 8, 2024, respectively,
we entered into separate amendments to the Forward Purchase Agreements (the collectively the “Second Amendments”) with Sandia
(the “Sandia Second Amendment”) and Polar (the “Polar Second Amendment”). The Second Amendments lower the reset
price of each Forward Purchase Agreement from $3.00 to $1.00 per share and amend the VWAP (as defined below) Trigger Event provision to
read: “After December 31, 2024, an event that occurs if the VWAP Price, for any 20 trading days during a 30 consecutive trading
day-period, is below $1.00 per Share.” The Sandia Second Amendment is not effective until we execute similar amendments with both
Polar and Meteora. Subsequently, on June 14, 2024, we entered into an amendment to the Forward Purchase Agreement with Sandia (the
“Sandia Third Amendment”). The Sandia Third Amendment sets the reset price of each Forward Purchase Agreement to $1.00 per
share and amends the VWAP Trigger Event provision to read: “After December 31, 2024, an event that occurs if the VWAP Price, for
any 20 trading days during a 30 consecutive trading day-period, is below $1.00 per Share.” In the event either Polar or Meteora
amend their Forward Purchase Agreements to include different terms from the $1.00 reset price and VWAP trigger adjustment, or file a notice
of a VWAP trigger event, as referenced herein, the Sandia Forward Purchase Agreement will be retroactively amended to reflect those improved
terms and liquidity on the Sandia Forward Purchase Agreement, including any of the 1,050,000 shares that were sold upon execution of the
Sandia Forward Purchase Agreement.

On July 17, 2024, we entered
into the third amendment to the Forward Purchase Agreement with Polar (the “Polar Third Amendment”), pursuant to which we
and Polar agreed that Section 2 (Most Favored Nation) of the Forward Purchase Agreement is applicable to all 2,450,000 shares subject
to the Forward Purchase Agreement. On July 15, 2025, we and Meteora entered into an amendment to the FPA between Meteora and us, on July
16, 2025, we and Sandia entered into an amendment to the FPA between Sandia and us, and on August 1, 2025, we and Polar entered in an
amendment to the FPA between Polar and us (collectively, the “FPA Amendments”). The FPA Amendments extend the valuation date
applicable to the Forward Purchase Agreements (the “Valuation Date”) to the earliest to occur of (a) July 17, 2026, (b) the
date specified by Meteora or Sandia, as applicable, in a written notice to be delivered to us at their discretion and (c) 90 days after
delivery by us of a written notice in the event that for any 20 trading days during a 30 consecutive trading day-period that occurs at
least six months after the closing date of the transactions under the Amended and Restated Business Combination Agreement entered into
on May 26, 2023, the applicable volume-weighted average price (“VWAP Price”) is less than the then applicable reset price,
provided that a registration statement was effective and available for the entire measurement period and remains continuously effective
and available during the entire 90 day notice period. The FPA Amendments further amend the definition of “Settlement Amount Adjustment”
to provide that if the expected Settlement Amount (as defined in the FPA Amendments) determined by the VWAP Price over the 15 scheduled
trading days ending on but excluding the valuation date exceeds the Settlement Amount Adjustment, then the Settlement Amount Adjustment
shall be deemed to be zero, and that if the Settlement Amount Adjustment exceeds the Settlement Amount, then the Settlement Amount Adjustment
shall be paid, at the Company’s option, in cash or shares of our common stock. The FPA Amendments also amend the definition of “Cash
Settlement Payment Date” to provide that if the Settlement Amount Adjustment exceeds the Settlement Amount, we shall remit to the
applicable seller the difference between (i) the Settlement Amount Adjustment and (ii) the Settlement Amount. The FPA Amendments further
provide that the Settlement Amount will be used solely as a calculation mechanism to determine any liability we may owe to the applicable
seller via the Settlement Amount Adjustment, and notwithstanding anything to the contrary, the applicable seller shall not be required
to remit the Settlement Amount to the Company or return any portion of the Prepayment Amount. 

As a result of these terms, the Forward Purchase Agreements represent
a potential use of liquidity that is sensitive to future trading prices of the Company’s common stock. If, on the applicable maturity
date or an earlier valuation date triggered by applicable VWAP-based events, our stock price is below the amended reset price, the FPA
investors are expected to exercise their contractual repurchase rights. In such circumstances, we could be required to make substantial
cash payments or issue additional shares, which would reduce liquidity and, in the case of share settlement, result in further dilution
to existing stockholders.

Any required repurchase of shares pursuant to the Forward Purchase
Agreements or early settlement obligations could materially reduce the cash available to fund operations, capital expenditures, and strategic
initiatives. These obligations may also limit our ability to raise additional capital on favorable terms. We continue to evaluate the
potential impacts of the Forward Purchase Agreements on future liquidity needs, and the Company’s ability to satisfy any required
cash settlements will depend on market conditions, operating performance, access to financing, and the market price of our common stock
during the applicable measurement periods.

In connection with the Forward Purchase Agreements, we have recorded
a liability on our consolidated balance sheets of $4.0 million and $3.5 million as of December 28, 2025 and December 29, 2024, respectively.

53

SAFE
Agreements

SAFE
obligations are a source of financing received which may be converted into shares of our common stock in an equity financing transaction,
or upon a change in control arising from a liquidity event, the holder of a SAFE is entitled to a portion of the proceeds. We entered
into three SAFE Agreements with the Rodgers Massey Freedom and Free Markets Charitable Trust, a related party affiliated with our CEO
for an aggregate amount of $6.0 million in fiscal 2024. Two of the SAFEs with an original amount of $5.0 million were converted to shares
of our common stock in fiscal 2024. As of December 28, 2025 and December 29, 2024, we had SAFE obligations recorded on our consolidated
balance sheets of $0.5 million and $0.4 million, respectively. Refer to Note 9 – SAFE Agreements, in Part II, Item 8 of
this Annual Report on Form 10-K for more information.

Leases

We
enter into various non-cancelable operating and finance leases. Current operating leases are primarily for our facilities with original
lease periods expiring through the year 2030. We had total operating lease obligations recorded on our consolidated balance sheets of
$5.2 million and $3.7 million as of December 28, 2025 and December 29, 2024, respectively. We have entered into various non-cancelable
finance leases for vehicles used in operations with original lease periods expiring through the year 2029. We had total finance lease
obligations recorded on our consolidated balance sheets of $3.1 million and $3.9 million as of December 28, 2025 and December 29, 2024,
respectively. Refer to Note 12 – Commitments and Contingencies, in Part II, Item 8 of this Annual Report on Form 10-K for
more information on our lease obligations.

Standby Equity Purchase Agreement; Convertible Note, and Convertible
Debenture

On
January 27, 2026 (the “Effective Date”), we entered into a Standby Equity Purchase Agreement (the “SEPA”) with
YA IIPN, LTD., a Cayman Islands exempt limited company (the “Investor”). Pursuant to the SEPA, the Investor will advance
up to $20.0 million to us in the form of a promissory note (“Promissory Note”). Promissory Notes will accrue interest on
the outstanding principal balance at an annual rate equal to 0%, which will increase to an annual rate of 18% upon the occurrence of
an Event of Default (as defined in the Promissory Notes) for so long as such event remains uncured. The Promissory Notes will mature
on January 27, 2027, which may be extended at the option of the Investor. Each tranche of a Promissory Note will be advanced less a discount
in the amount equal to 10% of the principal amount of such tranche. The first tranche was disbursed on January 27, 2026 in the principal
amount of $1.9 million. Subject to the conditions set forth in the SEPA, a second tranche in a principal amount of up to $18.1 million
may be advanced on the second trading day after the initial registration statement relating to the resale of the shares of our common
stock issuable upon conversion of the Promissory Notes first becomes effective.

The
Promissory Notes are convertible into shares of our common stock, $0.0001 par value per share at a conversion price equal to the lower
of (i) a price per share equal to 125% of the VWAP of our common stock on the trading day prior to the issuance date of each Promissory
Note, or (ii) 93% of the lowest daily VWAP during the five consecutive trading days immediately preceding the conversion date (but no
lower than the “floor price” then in effect, subject to adjustment from time to time in accordance with the terms contained
in the Promissory Notes).

Pursuant
to the SEPA, we will have the right, from time to time, until January 27, 2029 (unless the SEPA is terminated earlier), to require the
Investor to purchase up to $25.0 million of shares of our common stock (“Commitment Amount”) subject to certain limitations
and conditions set forth in the SEPA.

We
may not issue or sell any shares of our common stock to the Investor under the SEPA or under the Promissory Notes, which, when aggregated
with all other shares of our common stock then beneficially owned by the Investor and its affiliates would result in the Investor and
its affiliates beneficially owning more than 4.99% of the then-outstanding shares of our common stock.

We
paid the Investor a structuring and due diligence fee of $0.05 million and agreed to issue to the Investor 175,000 shares of our common
stock within three days of the Effective Date as a commitment fee.

The SEPA will automatically terminate on the earliest to occur of (i)
January 27, 2029 or (ii) the date on which the Investor has purchased from us under the SEPA the Commitment Amount in full. We may terminate
the SEPA at any time upon five trading days’ prior written notice to the Investor, provided that there are no outstanding advance
notices under which we are yet to issue shares of our common stock, there are no amounts outstanding under the Promissory Notes, and provided
that we have paid all amounts owed to the Investor pursuant to the SEPA. We and the Investor may also agree to terminate the SEPA by mutual
written consent.

54

On March 6, 2026 we entered
into a further Purchase Agreement pursuant to which the Investor purchased and we issued a convertible debenture in the principal amount
of $10.0 million (the “Debenture”). At the closing under such purchase agreement, we issued the Debenture to the Investor
in the original principal amount of $10.0 million for a purchase price of $9.0 million, less certain fees payable under the purchase agreement.
The Debenture accrues interest on the outstanding principal balance at an annual rate equal to 0%, which will increase to an annual rate
of 18% upon the occurrence of an event of default under the Debenture for so long as such event remains uncured. The Debenture will mature
on March 6, 2027, which may be extended at the option of the Investor.

On each of May 6, 2026, June
6, 2026, July 6, 2026, August 6, 2026 and September 6, 2026 (each an “Installment Date”), the Company is required to
pay an installment amount under the Debenture equal to (i) $2.0 million, plus (ii) a $0.06 million payment premium, and plus (iii) any
accrued and unpaid interest (collectively, the “Installment Amount”). We may repay each applicable Installment Amount,
at our option, (a) in cash on or before the applicable Installment Date or (b) by submitting an advance notice under the SEPA, or a combination
of a payment in cash and delivery of such advance notice. At any time after the Effective Date, the Investor may convert any portion of
the outstanding balance under the Debenture into shares of our common stock at a fixed price of $2.50 per share (the “Fixed Price”).
Additionally, at any time on or after any Installment Date, the Investor may convert any portion of any due and unpaid Installment Amount
outstanding under the Debenture into shares of our common stock at a price equal to 95% of the volume weighted average price (“VWAP”)
of our common stock during the five trading days prior to the conversion date (but the conversion price will not be lower than the “Floor
Price” then in effect).

The Company, at our option,
shall have the right to redeem early all or a portion of the amounts outstanding under the Debenture upon written notice to the Investor
(an “Optional Redemption”), provided, that we may only deliver a notice of Optional Redemption if the VWAP of our
common stock at the time the notice is delivered is less than the Fixed Price. In connection with an Optional Redemption, the redemption
price payable by us will be equal to (i) the outstanding principal amount of the Debenture being redeemed, plus (ii) a payment premium
equal to 3% of the principal amount being repaid, and plus (iii) accrued and unpaid interest under the Debenture; however, the prepayment
premium shall not apply to any Optional Redemption of the Debenture if the redemption price is paid on or before April 30, 2026.

Sunder Seller Note – related party 

On September 24, 2025, we issued a promissory note to the selling member
of Sunder (as amended, the “Seller Note”) in connection with the acquisition of 100% of the membership interests in Sunder.
The Seller Note has an original principal amount of $20.0 million. The Seller Note bears interest at 7.0% per annum, compounded at the
end of each calendar quarter. Interest is due and payable concurrent with the payment of the principal balance. The maturity date of the
Seller Note is the earlier of (i) May 15, 2026 and (ii) the date on which all amounts under the Seller Note otherwise become due and payable
following an event of default. The Seller Note must also be repaid in the event of a change of control of the Company or the sale of all
or substantially all of the consolidated assets of the Company and our subsidiaries. We concluded that since the sellers joined the Company
and have a level of influence that is not insignificant, they are related parties of the Company and therefore the Seller Note is a related
party obligation.

On March 5, 2026, we entered into an amendment of the Seller Note (“Amendment”)
that if the SEPA Debenture restricts repayment of the Seller Note on May 15, 2026, then the maturity date of the Seller Note will be extended
to the earlier of (a) the date that is two business days following the date on which the Seller Note may be repaid pursuant to the restrictions
set forth in the Debenture and (b) September 30, 2026 (or, if the registration statement required to be filed pursuant to the Registration
Rights Agreement has not been declared effective prior to April 30, 2026, then the outside maturity date will extend to December 31, 2026).
Additionally, the interest rate applicable to the Seller Note will increase to 10.0% per annum if the principal amount of the Seller Note
remains outstanding after May 15, 2026. As an inducement to agree to the foregoing, the Amendment also provides that, within two business
days following approval by our stockholders of the issuance of shares under the purchase agreement in accordance with applicable Nasdaq
rules, we will issue the remaining shares of common stock otherwise issuable to the seller pursuant to the purchase agreement. On April
8, 2026, we issued the remaining shares due under the Seller Note, 6.7 million shares of our common stock.

Proceeds
from Warrant Exercises

We will receive the proceeds from any cash exercise of any warrants.
The aggregate amount of proceeds could be up to $257.2 million if all the warrants are exercised for cash. However, to the extent the
warrants are exercised on a “cashless basis,” the amount of cash we would receive from the exercise of the warrants will decrease.
The Private Warrants and Working Capital Warrants may be exercised for cash or on a “cashless basis.” The Public Warrants
and the Mergers Warrants may only be exercised for cash provided there is then an effective registration statement registering the shares
of common stock issuable upon the exercise of such warrants. If there is not a then-effective registration statement, then such warrants
may be exercised on a “cashless basis,” pursuant to an available exemption from registration under the Securities Act. We
expect to use any such proceeds for general corporate and working capital purposes, which would increase our liquidity. As of April 13,
2026, the price of our common stock was $1.20 per share. The weighted average exercise price of the warrants was $10.52 as of December
28, 2025. We believe the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds that
we would receive, is dependent upon the market price of our common stock. If the market price for our common stock remains less than the
exercise price, we believe warrant holders will be unlikely to exercise. In which case we will not receive any proceeds from the cash
exercise of the warrants.

55

Cash
Flows

We
expect that our principal short-term (over the next 12 months) cash needs related to our operations will be to fund working capital,
acquisitions, payments on our outstanding debt, and legal settlements. We plan to fund any cash requirements for the next 12 months from
our existing cash and cash equivalents, cash generated from operations and debt and equity financings. For the long-term period (beyond
12 months), we aim to generate cash flows from operations to support our ongoing business operations and strategic investment plans.
We regularly evaluate our liquidity position, debt obligations and expected cash requirements. As part of this ongoing assessment, we
may pursue additional financing through the issuance of equity or the debt financing, as necessary, to meet our operational and investment
needs. Our ability to obtain debt or any other additional financing that we may choose to, or need to, obtain will depend on, among other
things, our development efforts, business plans, operating performance and the condition of the capital markets at the time we seek financing.

As a result of not timely filing our Annual Report on Form 10-K for
the fiscal year ended December 29, 2024, we are not currently eligible to use a registration statement on Form S-3 that
would allow us to continuously incorporate by reference our SEC reports into the registration statement, to use “shelf” registration
statements to conduct offerings, or to use our at-the-market offering facility until approximately one year from the date we have regained
and maintained status as a current filer. Our inability to use Form S-3 significantly impairs our ability to raise the necessary capital
to fund our operations and execute our strategy. If we seek to access to the capital markets through a registered offering during the
period of time that we are unable to use Form S-3, we may be required to publicly disclose the proposed offering and the material terms
thereof before the offering commences, we may experience delays in the offering process due to SEC review of a Form S-1 registration statement
and we may incur increased offering and transaction costs and other considerations. If we are unable to raise capital through a registered
offering, we would be required to conduct our equity financing transactions on a private placement basis, which may be subject to pricing,
size and other limitations imposed under the Nasdaq rules, or seek other sources of capital. The foregoing limitations on our financing
approaches could prevent us from pursuing transactions or implementing business strategies that would be beneficial to our business.

Cash
Flows for the Fiscal Years Ended December 28, 2025 and December 29, 2024

The
following table summarizes our cash flows from operating, investing, and financing activities for the fiscal years ended (in thousands):

Fiscal Year Ended

December 28,

December 29,

2025

2024

Net cash used in operating activities from continuing operations

$

(15,327

)

$

(54,662

)

Net cash used in investing activities from continuing operations

(19,339

)

(54,657

)

Net cash provided by financing activities from continuing operations

30,905

120,100

Net (decrease) increase in cash, cash equivalents and restricted cash

(3,761

)

10,803

Cash
Flows from Operating Activities

Net cash used in operating activities from continuing operations of $15.3
million for the fiscal year ended December 28, 2025 was primarily due to the net loss from continuing operations, net of tax of $44.3
million and net cash outflows of $3.1 million from changes in our operating assets and liabilities which was partially offset by non-cash
adjustments of $32.1 million. The main drivers of non-cash charges of $31.3 million consisted of $15.3 million of amortization of
debt issuance costs, $10.5 million of stock-based compensation expense, $9.1 million of depreciation and amortization expense, $3.6 million
provision for credit losses, $2.8 million loss due to the changes in the fair value warrant liabilities, $1.4 million of non-cash lease
expense, and $1.3 million of deferred tax expense, partially offset by an $11.5 million change in the fair value of derivative liabilities,
a $0.5 million change in the fair value of our forward purchase agreement liabilities, and a $0.6 million change in the fair value of
deferred consideration in connection with our acquisition of Sunder. The main drivers of net cash outflows from changes in operating assets
and liabilities consisted of a $38.8 million increase in trade accounts receivable, an $15.9 million decrease in accrued expenses and
other current liabilities, a $1.5 million decrease in operating lease liabilities, a $5.6 million increase in prepaid expenses and other
assets and a $3.1 million decrease in contract liabilities, partially offset by a $38.4 million decrease in inventories, a $15.3 million
increase in accounts payable and an $8.5 million decrease in contract assets.

Net
cash used in operating activities from continuing operations of $54.6 million for the fiscal year ended December 29, 2024 was primarily
due to the net loss from continuing operations, net of tax of $54.4 million and net cash outflows of $6.6 million from changes in our
operating assets and liabilities which was partially offset by non-cash adjustments of $6.4 million. Non-cash charges primarily consisted
of $24.7 million for loss on issuance of derivative liability, $9.1 million provision for credit losses, $5.8 million of amortization
of debt issuance costs, $9.2 million of non-cash expense in connection with warrants issued for vendor services, $3.1 million of stock-based
compensation expense, $3.9 million accretion of debt in CS Solis, $3.8 million for asset impairment and disposals, $2.7 million for depreciation
and amortization, $1.8 million for non-cash interest expense, $0.8 million for lease expense, and $1.3 million for loss on conversion
of SAFE Agreements to shares of common stock, and $0.4 million of other financing costs, partially offset by a decrease of $34.0 million
for the change in fair value of derivative liabilities, $22.3 million gain on troubled debt restructuring, $2.9 million change in fair
value of warrant liabilities, and $1.0 million change due to fair value adjustments. The main drivers of net cash outflows derived from
the changes in operating assets and liabilities were related to an increase in contract assets of $21.5 million, a $10.4 million decrease
in accounts payable, a $0.8 million decrease in operating lease liabilities, and a $0.2 million increase in prepaid expenses and other
current assets, partially offset by an $8.7 million decrease in inventories, a $3.3 million decrease in accounts receivable, a $14.1
million increase in accrued expenses and $0.2 million of other.

56

Cash
Flows from Investing Activities

Net cash used in investing activities from continuing operations of
$19.3 million in 2025 is principally attributable to the cash paid for the acquisition of Sunder. 

Net
cash used by investing activities from continuing operations of $54.7 million for the fiscal year ended December 29, 2024 was primarily
due to the acquisition of SunPower of $53.5 million (net of $1.0 million of cash) and $1.2 million in capital expenditures.

Cash
Flows from Financing Activities

Net cash provided by financing activities from continuing operations in
2025 was $30.9 million and consisted of $19.8 million received in exchange for 7.0% senior unsecured convertible notes, $7.0 million received
from related party trusts of T.J. Rodgers, our Chairman and CEO, in exchange for 12% senior unsecured convertible notes, an investor deposit
of $2.0 million received from a related party trust of T.J. Rodgers, $6.7 million in proceeds from the issuance of shares of our common
stock, and $0.6 million in proceeds from the exercise of stock options and a warrant in exchange for shares of our common stock, partially
offset by $2.3 million of finance lease payments, $2.2 million in payments on our debt obligations and $0.7 million for taxes paid related
to net share settlement of equity awards.

Net
cash provided by financing activities from continuing operations in 2024 was of $120.1 million and consisted of $107.7 million in proceeds
from the issuance of convertible notes, $6.0 million in proceeds from the issuance of SAFE agreement, $6.7 million in proceeds from the
issuance of common stock and $0.5 million in proceeds from the exercise of common stock options. The proceeds were partially offset by
finance lease payments and the payment of a note aggregating $0.8 million.

Emerging
Growth Company Status

Section
102(b)(1) of the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, exempts emerging growth companies from being required
to comply with new or revised financial accounting standards until private companies are required to comply with the new or revised financial
accounting standards. The JOBS Act provides that a company can choose not to take advantage of the extended transition period
and comply with the requirements that apply to non-emerging growth companies, and any such election to not take advantage of
the extended transition period is irrevocable.

SunPower
is an “emerging growth company” as defined in Section 2(a) of the Securities Act and has elected to take advantage of the
benefits of the extended transition period for new or revised financial accounting standards. Following the closing of the Mergers, our
post-combination company remains an emerging growth company until the earliest of (i) the last day of the fiscal year in which the market
value of common stock that is held by non-affiliates exceeds $700 million as of the end of that year’s second fiscal
quarter, (ii) the last day of the fiscal year in which we have total annual gross revenue of $1.235 billion or more during such fiscal
year (as indexed for inflation), (iii) the date on which we have issued more than $1.0 billion in non-convertible debt in the
prior three-year period, or (iv) the last day of the fiscal year ending after the fifth anniversary of our IPO. We expect to continue
to take advantage of the benefits of the extended transition period, although we may decide to early adopt such new or revised accounting
standards to the extent permitted by such standards. This may make it difficult or impossible to compare our financial results with the
financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen
not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.