Tecnoglass Inc. (TGLS) Risk Factors

Item 1A. Risk Factors.

You
should carefully consider the risks and uncertainties described below, together with the financial and other information contained in
this Annual Report on Form 10-K. Our business may also be adversely affected by risks and uncertainties not presently known to us or
that we currently believe to be immaterial. If any of the following risks, such other risks or the risks described elsewhere in this
Annual Report on Form 10-K, including in the section entitled “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” actually occur, our business, financial condition, operating results, cash flow and prospects could
be materially adversely affected. This could cause the trading price of our ordinary shares to decline.

Risks
Related to Our Business Operations

We
operate in competitive markets, and our business could suffer if we are unable to adequately address potential downward pricing pressures
and other factors that may reduce operating margins.

The
principal markets that we serve are highly competitive. Competition is based primarily on the precision and range of achievable tolerances,
quality, price and the ability to meet delivery schedules dictated by customers. Our competition comes from companies of various sizes,
some of which have greater financial and other resources than we do and some of which have more established brand names in the markets
that we serve. We currently compete with companies such as Viracon (a subsidiary within the Apogee Enterprises Inc. Group), PGT, Cardinal
Glass and Oldcastle Glass among others in the United States and companies such as Vitro, Vitelco and others in the Colombia and Latin
America. Any of these competitors may foresee the course of market development more accurately than we will, develop products that are
superior to ours, have the ability to produce similar products at a lower cost than us or adapt more quickly than we can to new technologies
or evolving customer requirements. Increased competition could force us to lower our prices or to offer additional services at a higher
cost to us, which could reduce gross profit and net income. Accordingly, we may not be able to adequately address potential downward
pricing pressures and other factors, which may adversely affect our financial condition and results of operations.

Failure
to maintain the performance, reliability and quality standards required by our customers could have a materially negative impact on our
financial condition and results of operation.

If
our products or services have performance, reliability or quality problems, or products are installed with incompatible glazing materials,
we may experience additional warranty and service expenses, reduced or canceled orders, diminished pricing power, higher manufacturing
or installation costs or delays in the collection of accounts receivable. Additionally, performance, reliability, or quality claims from
our customers, with or without merit, could result in costly and time-consuming litigation that could require significant time and attention
of management and involve significant monetary damages that could negatively affect our financial results.

The
volatility of the cost of raw materials used to produce our products could materially adversely affect our results of operations in the
future.

The
cost of raw materials included in our products, including aluminum extrusion and polyvinyl butyral, are subject to significant fluctuations
derived from changes in price or volume. A variety of factors over which we have no control, including global demand for aluminum, fluctuations
in oil prices, speculation in commodities futures and the creation of new laminates or other products based on new technologies, impact
the cost of raw materials which we purchase for the manufacture of our products.

We
quote our prices of aluminum products based on the price of aluminum in the London Metal Exchange plus a premium, and our suppliers of
glass and polyvinyl butyral provide us with price lists that are updated annually, thus reducing the risk of changing prices for orders
in the short term. While we may attempt to minimize the risk from severe price fluctuations by entering into aluminum forward contracts
to hedge these fluctuations in the purchase price of aluminum extrusion we use in production, substantial, prolonged upward trends in
aluminum prices could significantly increase the cost of our aluminum needs and have an adverse impact on our results of operations.
If we are not able to pass on significant cost increases to our customers, our results in the future may be negatively affected by a
delay between the cost increases and price increases in our products. Accordingly, the price volatility of raw materials could adversely
affect our financial condition and results of operations in the future.

We
depend on third-party suppliers for our raw materials and any failure of such third-party suppliers in providing raw materials could
negatively affect our ability to manufacture our products.

Our
ability to offer a wide variety of products to our customers depends on receipt of adequate material supplies from manufacturers and
other suppliers. It is possible in the future that our competitors or other suppliers may create products based on new technologies that
are not available to us or are more effective than our products at surviving hurricane-force winds and wind-borne debris or that they
may have access to products of a similar quality at lower prices. Although in some instances we have agreements with our suppliers, these
agreements are generally terminable by us or the supplier counterparties on limited notice. We have a fixed set of maximum price rates,
and from those prices we negotiate with the supplier of the material depending on the project. We source raw materials and glass necessary
to manufacture our products from a variety of domestic and foreign suppliers. During the year ended December 31, 2025, two suppliers
accounted for more than 10% of total raw material purchases, and in aggregate both account for 37.3% of total raw material purchases.
Failures of third-party suppliers to provide raw materials to us in the future could have an adverse impact on our operating results
or our ability to manufacture our products.

We
rely on third-party transportation, which subjects us to risks and costs that we cannot control, and which risks and costs may materially
adversely affect our operations.

We
rely on third party trucking companies to transport raw materials to the manufacturing facilities used by each of our businesses and,
to a lesser degree, to ship finished products to customers. These transport operations are subject to various hazards and risks, including
extreme weather conditions, work stoppages and operating hazards, as well as interstate transportation regulations. In addition, the
methods of transportation we utilize may be subject to additional, more stringent and more costly regulations in the future. If we are
delayed or unable to ship finished products or unable to obtain raw materials as a result of any such new regulations or public policy
changes related to transportation safety, or these transportation companies fail to operate properly, or if there were significant changes
in the cost of these services due to new or additional regulations, or otherwise, we may not be able to arrange efficient alternatives
and timely means to obtain raw materials or ship goods, which could result in a material adverse effect on our revenues and costs of
operations. Transportation costs represent a significant part of our cost structure. If our transportation costs increased substantially,
due to prolonged increases in fuel prices or otherwise, we may not be able to control them or pass the increased costs onto customers,
and our profitability would be negatively impacted.

We
may not realize the anticipated benefit through our joint venture with Saint-Gobain as the construction of a new plant as part of the
joint venture may not be completed as planned.

On
May 3, 2019, we acquired an approximately 25.8% minority interest in Vidrio Andino’s float glass plant in the outskirts of Bogota,
Colombia in connection with our joint venture agreement with Saint-Gobain. We believe this joint venture has solidified our vertical
integration strategy by providing us with an interest in the first stage of our production chain, while securing ample glass supply for
our expected production needs. Although our glass supply ran smoothly during 2023, we may be unable to fully realize the planned synergies
and fail to integrate some aspects of the facility’s production capacity into our manufacturing process, which may have a negative
impact on our financial condition in the future. Additionally, the joint venture agreement includes plans to build a new plant in Galapa,
Colombia that will be located approximately 20 miles from our primary manufacturing facility in which we will also have a 25.8% interest.
The new plant will be funded with the original cash contribution made by the Company, operating cash flows from the Bogota plant, and
debt incurred at the joint venture level that will not consolidate into the Company.

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There
can be no assurance that the anticipated joint venture cost synergies, increases in capacity or production and optimization of certain
manufacturing processes associated with the reduction of raw material waste, and supply chain synergies, including purchasing raw materials
at more advantageous prices, will be achieved, or that they might not be significantly and materially less than anticipated, or that
the completion of the joint venture with Saint-Gobain will be timely or effectively accomplished. In addition, our ability to realize
the anticipated cost synergies and production capacity increases are subject to significant business, economic and competitive uncertainties
and contingencies, many of which are beyond our control, such as changes to government regulation governing or otherwise impacting our
industry, operating difficulties, client preferences, changes in competition and general economic or industry condition.

Constructing
a new manufacturing facility involves risks, including financial, construction and governmental approval risks. If Vidrio Andino’s
plant fails to produce the anticipated cash flow, if we are unable to allocate the required capital to the new plant, if we are unable
to secure the necessary permits, approvals or consents or if we are unable to enter into a contract for the construction of the plant
on suitable terms, we will fail to realize the expected benefits of the joint venture.

The
success of our business depends, in part, on our ability to execute on our acquisition strategy, to successfully integrate acquisitions
and to retain key employees of our acquired businesses.

A
portion of our historical growth has occurred through acquisitions, and we may enter into additional acquisitions in the future. We may
at any time be engaged in discussions or negotiations with respect to possible acquisitions, including transactions that would be significant
to us. We regularly make, and we expect to continue to make, acquisition proposals, and we may enter into letters of intent for acquisitions.
We cannot predict the timing of any contemplated transactions. To successfully finance such acquisitions, we may need to raise additional
equity capital and indebtedness, which could increase our leverage level. We cannot assure you that we will enter into definitive agreements
with respect to any contemplated transactions or that transactions contemplated by any definitive agreements will be completed on time
or at all. Our growth has placed, and will continue to place, significant demands on our management and operational and financial resources.
Acquisitions involve risks that the businesses acquired will not perform as expected and that business judgments concerning the value,
strengths and weaknesses of acquired businesses will prove incorrect.

Acquisitions
may require integration of acquired companies’ sales and marketing, distribution, purchasing, finance and administrative organizations,
as well as exposure to different legal and regulatory regimes in jurisdictions in which we have not previously operated. We may not be
able to successfully integrate any business we may acquire or have acquired into our existing business, and any acquired businesses may
not be profitable or as profitable as we had expected. Our inability to complete the integration of new businesses in a timely and orderly
manner could increase costs and lower profits. Factors affecting the successful integration of acquired businesses include, but are not
limited to, the following:

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We
may not be able to realize the expected return on our growth and efficiency capital expenditure plan.

In
recent years, we have made significant capital expenditures which include:

There
can be no assurance that the anticipated cost saving initiatives will be achieved, or that they will not be significantly and materially
less than anticipated, or that the completion of such cost savings initiatives will be effectively accomplished. In addition, our ability
to realize the anticipated cost savings are subject to significant business, economic and competitive uncertainties and contingencies,
many of which are beyond our control, such as changes to government regulation governing or otherwise impacting our industry, operating
difficulties, client preferences, changes in competition and general economic or industry condition. If we fail to realize the anticipated
cost savings it could have a negative impact on our financial position.

Our
success depends upon our ability to develop new products and services, integrate acquired products and services and enhance existing
products and services through product development initiatives and technological advances. Any failure to make such improvements could
harm our future business and prospects.

We
have continuing programs designed to develop new products and to enhance and improve our existing products. We are expending resources
for the development of new products in all aspects of our business, including products that can reach a broader customer base. Some of
these new products must be developed due to changes in legislative, regulatory or industry requirements or in competitive technologies
that render certain of our existing products obsolete or less competitive. The successful development of our products and product enhancements
are subject to numerous risks, both known and unknown, including unanticipated delays, access to significant capital, budget overruns,
technical problems and other difficulties that could result in the abandonment or substantial change in the design, development and commercialization
of these new products. The events could have a materially adverse impact on our results of operations.

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Given
the uncertainties inherent with product development and introduction, including lack of market acceptance, we cannot provide assurance
that any of our product development efforts will be successful on a timely basis or within budget, if at all. Failure to develop new
products and product enhancements on a timely basis or within budget could harm our business and prospects. In addition, we may not be
able to achieve the technological advances necessary for us to remain competitive, which could have a materially negative impact on our
financial condition.

The
home building industry and the home repair and remodeling sector are regulated, and any increased regulatory restrictions could negatively
affect our sales and results of operations.

The
home building industry and the home repair and remodeling sector are subject to various local, state, and federal statutes, ordinances,
rules and regulations concerning zoning, building design and safety, hurricane and floods, construction, and similar matters, including
regulations that impose restrictive zoning and density requirements in order to limit the number of homes that can be built within the
boundaries of a particular area. Increased regulatory restrictions could limit demand for new homes and home repair and remodeling products,
which could negatively affect our sales and results of operations. We may not be able to satisfy any future regulations, which consequently
could have a negative effect on our sales and results of operations.

Changes
in building codes could lower the demand for our impact-resistant windows and doors.

The
market for our impact-resistant windows and doors depends in large part on our ability to satisfy state and local building codes that
require protection from wind-borne debris. If the standards in such building codes are raised, we may not be able to meet such requirements,
and demand for our products could decline. Conversely, if the standards in such building codes are lowered or are not enforced in certain
areas, demand for impact-resistant products may decrease. If we are unable to satisfy future regulations, including building code standards,
it could negatively affect our sales and results of operations. Further, if states and regions that are affected by hurricanes but do
not currently have such building codes fail to adopt and enforce hurricane protection building codes, our ability to expand our business
in such markets may be limited.

We
are subject to labor, and health and safety regulations, and may be exposed to liabilities and potential costs for lack of compliance.

We
are subject to labor and health and safety laws and regulations that govern, among other things, the relationship between us and our
employees and the health and safety of our employees. If we are found to have violated any labor or health and safety laws, we may be
exposed to penalties and sanctions, including the payment of fines. In particular, most of our employees are hired through temporary
staffing companies and are employed under one-year fixed-term employment contracts. According to applicable labor law regarding temporary
staffing companies, if we exceed the limits for hiring temporary employees and the Colombian Ministry of Labor identifies the existence
of illegal outsourcing, sanctions may be imposed along with probable lawsuits by employees claiming the existence of a labor relationship.
Our subsidiaries could also be subject to work stoppages or closure of operations.

The
above could result in cancellation or suspension of governmental registrations, authorizations and licenses issued by other authorities,
any one of which may result in interruption or discontinuity of business, and could, consequently, materially and adversely affect our
business, financial condition or results of operation.

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Equipment
failures, delays in deliveries and catastrophic loss at our manufacturing facility could lead to production curtailments or shutdowns
that prevent us from producing our products.

An
interruption in production capabilities at any of our facilities because of equipment failure or other reasons could result in our inability
to produce our products, which would reduce our sales and earnings for the affected period. In addition, we generally manufacture our
products only after receiving the order from the customer and thus do not hold large inventories. If there is a stoppage in production
at our manufacturing facilities, even if only temporarily, or if they experience delays because of events that are beyond our control,
delivery times could be severely affected. Any significant delay in deliveries to our customers could lead to increased product returns
or cancellations and cause us to lose future sales. Our manufacturing facilities are also subject to the risk of catastrophic loss due
to unanticipated events such as fires, explosions, or violent weather conditions. If we experience plant shutdowns or periods of reduced
production because of equipment failure, delays in deliveries or catastrophic loss, it could have a material adverse effect on our results
of operations or financial condition. Further, we may not have adequate insurance to compensate for all losses that result from any of
these events.

Our
reliance for a majority of our business on a single facility subjects us to concentrated risks.

We
currently operate the vast majority of our business from a single production facility in Barranquilla, Colombia. Due to the lack of diversification
in our assets and geographic location, an adverse development at or impacting our facility or in local or regional economic or political
conditions could have a significantly greater impact on our results of operations and financial condition than if we maintained more
diverse assets and locations. While we implement preventative and proactive maintenance at our facility, it is possible that we could
experience prolonged periods of reduced production and increased maintenance and repair costs due to equipment failures. In addition,
because of our single facility and location, in certain cases we rely on limited or single suppliers for significant inputs, such as
electricity. We are also reliant on the adequacy of the local skilled labor force to support our operations. Supply interruptions to
or labor shortages or stoppages at our facility could be caused by any of the aforementioned factors, many of which are beyond our control,
and would adversely affect our operations and we would not have any ability to offset this concentrated impact with activities at any
alternative facilities or locations.

Customer
concentration and related credit, commercial and legal risk may adversely impact our future earnings and cash flows.

Our
ten largest third-party customers worldwide collectively accounted for 33.9% of our total sales revenue for the year ended December 31,
2025, though no single customer accounted for more than 10% of annual revenues. We also do not have any long-term requirements contracts
pursuant to which we would be required to fulfill customer orders on an as-needed basis.

Although
the customary terms of our arrangements with customers in Latin America and the Caribbean typically require a significant upfront payment
ranging from between 30% and 50% of the cost of an order, if a large customer were to experience financial difficulty, or file for bankruptcy
or similar protection, or if we were unable to collect amounts due from customers that are currently under bankruptcy or similar protection,
it could adversely impact our results of operations, cash flows and asset valuations. Therefore, the risk we face in doing business with
these customers may increase. Financial problems experienced by our customers could result in the impairment of our assets, a decrease
in our operating cash flows and may also reduce or curtail our customers’ future use of our products and services, which may have
an adverse effect on our revenues.

Disagreements
between the parties can arise as a result of the scope and nature of the relationship and ongoing negotiations. Although we do not have
any disputes with any major customers as of the date hereof that are expected to have a material adverse effect on our financial position,
results of operations or cash flows, we cannot predict whether such disputes will arise in the future.

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Our
results may not match our provided guidance or the expectations of securities analysts or investors, which likely would have an adverse
effect on the market price of our securities.

Our
results may fall below provided guidance and the expectations of securities analysts or investors in future periods. Our results may
vary depending on a number of factors, including, but not limited to, fluctuating customer demand, delay or timing of shipments, construction
delays or cancellations due to lack of financing for construction projects or market acceptance of new products. Manufacturing or operational
difficulties that may arise due to quality control, capacity utilization of our production equipment or staffing requirements may also
adversely affect annual net sales and operating results. Moreover, where we participate in fixed-price contracts for installation services,
changes in timing of construction projects or difficulties or errors in their execution caused by us or other parties, could result in
a failure to achieve expected results. In addition, competition, including new entrants into our markets, the introduction of new products
by competitors, adoption of improved technologies by competitors and competitive pressures on prices of products and services, could
adversely affect our results. Finally, our results may vary depending on raw material pricing, the potential for disruption of supply
and changes in legislation that could have an adverse impact on labor or other costs. Our failure to meet our provided guidance or the
expectations of securities analysts or investors would likely adversely affect the market price of our securities.

If
new construction levels and repair and remodeling markets decline, such market pressures could negatively affect our results of operations.

The
architectural glass industry is subject to the cyclical market pressures of the larger new construction and repair and remodeling markets.
In turn, these larger markets may be affected by adverse changes in economic conditions such as demographic trends, employment levels,
interest rates, commodity prices, availability of credit and consumer confidence, as well as by changing needs and trends in the markets,
such as shifts in customers’ preferences and architectural trends. Any future downturn or any other negative market pressures could
negatively affect our results of operations in the future, as margins may decrease as a direct result of an overall decrease in demand
for our products. Additionally, we may have idle capacity which may have a negative effect on our cost structure.

We
may be adversely affected by disruptions to our manufacturing facilities or disruptions to our customer, supplier or employee base.

Any
disruption to our facilities resulting from weather-related events, fire, an act of terrorism or any other cause could damage a significant
portion of our inventory, affect our distribution of products and materially impair our ability to distribute products to customers.
We could incur significantly higher costs and longer lead times associated with distributing our products to customers during the time
that it takes for us to reopen or replace a damaged facility. In addition, if there are disruptions to our customer and supplier base
or to our employees caused by weather-related events, acts of terrorism, pandemics, or any other cause, our business could be temporarily
adversely affected by higher costs for materials, increased shipping and storage costs, increased labor costs, increased absentee rates
and scheduling issues. Any interruption in the production or delivery of our supplies could reduce sales of our products and increase
costs.

Our
business involves complex manufacturing processes that may cause personal injury or property damage, subjecting us to liabilities, possible
losses, and other disruptions of our operations in the future, which may not be covered by insurance.

Our
business involves complex manufacturing processes. Some of these processes involve high pressures, temperatures, hot metal and other
hazards that present certain safety risks to workers employed at our manufacturing facilities. The potential exists for accidents involving
death or serious injury. Although our management is highly committed to health and safety, since January 2014, two fatalities have occurred
at our operations. The potential liability resulting from any such accident to the extent not covered by insurance could result in unexpected
cash expenditures, thereby reducing the cash available to operate our business. Such an accident could disrupt operations at any of our
facilities, which could adversely affect our ability to deliver products to our customers on a timely basis and to retain our current
business.

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Operating
hazards inherent in our business, some of which may be outside of our control, can cause personal injury and loss of life, damage to
or destruction of property, plant and equipment and environmental damage. We maintain insurance coverage in amounts and against the risks
we believe are consistent with industry practice, but this insurance may not be adequate or available to cover all losses or liabilities
we may incur in our operations. Our insurance policies are subject to varying levels of deductibles. Losses up to our deductible amounts
accrue based upon our estimates of the ultimate liability for claims incurred and an estimate of claims incurred but not reported. However,
liabilities subject to insurance are difficult to estimate due to unknown factors, including the severity of an injury, the determination
of our liability in proportion to other parties, the number of incidents not reported and the effectiveness of our safety programs. If
we were to experience insurance claims or costs above our estimates, we might also be required to use working capital to satisfy these
claims.

The
nature of our business exposes each of our subsidiaries to product liability and warranty claims that, if adversely determined, could
negatively affect our financial condition and results of operations and the confidence of customers in our products.

Our
subsidiaries are, from time to time, involved in product liability and product warranty claims relating to the products they manufacture
and distribute that, if adversely determined, could adversely affect our financial condition, results of operations and cash flows. In
addition, they may be exposed to potential claims arising from the conduct of homebuilders and home remodelers and their sub-contractors.
We may not be able to maintain insurance on acceptable terms or insurance may not provide adequate protection against potential liabilities
in the future. Product liability claims can be expensive to defend and can divert the attention of management and other personnel for
significant periods, regardless of the ultimate outcome. Claims of this nature could also have a negative impact on customer confidence
in our products and us.

We
are subject to potential exposure to environmental liabilities and are subject to environmental regulation and any such liabilities or
regulation may negatively affect our costs and results of operations in the future.

Our
subsidiaries are subject to various national, state and local environmental laws, ordinances and regulations that are frequently changing
and becoming more stringent. Although we believe that our facilities are materially in compliance with such laws, ordinances and regulations,
we cannot be certain that we will, at all times, be able to maintain compliance. Furthermore, as owners of real property, our subsidiaries
can be held liable for the investigation or remediation of contamination on such properties, in some circumstances, without regard to
whether we knew of or were responsible for such contamination. Remediation may be required in the future because of spills or releases
of petroleum products or hazardous substances, the discovery of unknown environmental conditions, or more stringent standards regarding
existing residual contamination. Environmental regulatory requirements may become more burdensome, increase our general and administrative
costs, the availability of construction materials, raw materials and energy, and increase the risk that our subsidiaries incur fines
or penalties or be held liable for violations of such regulatory requirements. New regulations regarding climate change may also increase
our expenses and eventually reduce our sales.

Weather
can materially affect our business and we are subject to seasonality.

Seasonal
changes and other weather-related conditions can adversely affect our business and operations through a decline in both the use and production
of our products and demand for our services. Adverse weather conditions, such as extended rainy and cold weather in the spring and fall,
can reduce demand for our products and reduce sales or render our distribution operations less efficient. Major weather events such as
hurricanes, tornadoes, tropical storms and heavy snows with quick rainy melts could adversely affect sales in the near term.

Construction
materials production and shipment levels follow activity in the construction industry, which typically occurs in the spring, summer and
fall. Warmer and drier weather during the second and third quarters typically result in higher activity and revenue levels during those
quarters. The first quarter typically has lower levels of activity partially due to inclement weather conditions. The activity level
during the second quarter varies greatly with variations in temperature and precipitation.

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Our
results of operations could be significantly affected by foreign currency fluctuations and currency regulations.

We
are subject to risks relating to fluctuations in currency exchange rates that may affect our sales, cost of sales, operating margins
and cash flows. During the year ended December 31, 2025, approximately 3.2% of our revenues and 25% of our expenses were in Colombian
pesos. The remainder of our expenses and revenues were denominated, priced and realized in U.S. Dollars. In the future, and especially
as we further expand our sales in other markets, our customers may increasingly make payments in non-U.S. currencies. In addition, currency
devaluation can result in a loss to us if we hold monetary assets in that currency. Hedging foreign currencies can be difficult and costly,
especially if the currency is not actively traded. We cannot predict the effect of future exchange rate fluctuations on our operating
results.

In
addition, we are subject to risks relating to governmental regulation of foreign currency, which may limit our ability to:

Furthermore,
the Colombian government and the Colombian Central Bank intervene in the country’s economy and occasionally make significant changes
in monetary, fiscal and regulatory policy, which may include the following measures:

For
a more detailed description of foreign exchange regulations in Colombia, see “Risk factors – Risks Related to Colombia and
Other Countries Where We Operate – The Colombian government and the Central Bank exercise significant influence on the Colombian
economy”.

As
we continue to increase our operations in foreign countries, there is an increased risk that foreign currency controls may create difficulty
in repatriating profits from foreign countries in the form of taxes or other restrictions, which could restrict our cash flow.

We
are dependent on certain key personnel, the loss of whom could materially affect our financial performance and prospects in the future.

Our
continued success depends largely upon the continued services of our senior management and certain key employees. Each member of our
senior management teams has substantial experience and expertise in his or her industry and has made significant contributions to our
growth and success. However, we do not have employment agreements in place for any of our executive officers. Accordingly, we face the
risk that members of our senior management may not continue in their current positions and the loss of the services of any of these individuals
could cause us to lose customers and reduce our net sales, lead to employee morale problems and the loss of other key employees or cause
disruptions to production. In addition, we may be unable to find qualified individuals to replace any senior executive officers who leave
our employ or that of our subsidiaries.

Members
of our management team have been, may be, or may become, involved in litigation, investigations or other proceedings. The defense or
prosecution of these matters could be time-consuming and could divert our management’s attention, and may have an adverse effect
on us.

During
the course of their careers, our officers and directors have been, may be or may in the future become involved in litigation, investigations
or other proceedings. Our officers and directors also may become involved in litigation, investigations or other proceedings involving
claims or allegations related to or as a result of their personal conduct, either in their capacity as a corporate officer or director
or otherwise, and may be personally named in such actions and potentially subject to personal liability. Any such liability may or may
not be covered by insurance and/or indemnification, depending on the facts and circumstances. The defense or prosecution of these matters
could be time-consuming. Any litigation, investigations or other proceedings and the potential outcomes of such actions may divert the
attention and resources of our officers and directors away from our operations and may negatively affect our reputation, which may adversely
impact our operations and profitability.

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We
have entered into significant transactions with affiliates or other related parties, which may result in conflicts of interest.

We
have entered into transactions with affiliates or other related parties in the past and may do so again in the future. While we believe
such transactions have been and will continue to be negotiated on an arm’s length basis, giving us a competitive advantage with
vertical integration, there can be no assurance that such transactions could not give rise to conflicts of interest that could adversely
affect our financial condition and results of operations.

The
interests of our controlling shareholders could differ from the interests of our other shareholders.

Energy
Holding Corporation exercises significant influence over us as a result of its majority shareholder position and voting rights. As of
the date of this Form 10-K, Energy Holding Corporation beneficially owned approximately 44.1% of our outstanding ordinary shares. Energy
Holding Corporation, in turn, is controlled by members of the Daes family, who together own 100% of the shares of Energy Holding Corporation.
See “Principal Securityholders”. Accordingly, our controlling shareholders would have considerable influence regarding the
outcome of any transaction that requires shareholder approval. In addition, if we are unable to obtain requisite approvals from Energy
Holding Corporation, we may be prevented from executing critical elements of our business strategy.

We
conduct all of our operations through our subsidiaries and will rely on payments from our subsidiaries to meet all of our obligations
and may fail to meet our obligations if our subsidiaries are unable to make payments to us.

We
are a holding company and derive substantially all of our operating income from our subsidiaries. All of our assets are held by our subsidiaries,
and we rely on the earnings and cash flows of our subsidiaries to meet our debt service obligations or dividend payments. The ability
of our subsidiaries to make payments to us will depend on their respective operating results and may be restricted by, among other things,
the laws of their jurisdiction of organization including Colombian foreign exchange regulations (which may limit the amount of funds
available for distributions to us), the terms of existing and future indebtedness and other agreements of our subsidiaries, including
their credit facilities, and the covenants of any future outstanding indebtedness we or our subsidiaries incur. See “Risk Factors
– Risks Related to Colombia and Other Countries Where We Operate – The Colombian government and the Central Bank exercise
significant influence on the Colombian economy.” If our subsidiaries are unable to declare dividends, our ability to meet debt
service or dividend payments may be impacted. The ability of our subsidiaries in Colombia to declare dividends up to the total amount
of their capital is not restricted by current laws, covenants in debt agreements or other agreements but could be restricted pursuant
to applicable law in the future or if our Colombian subsidiaries undergo a transformation to other types of corporate entities.

Increasing
interest rates could materially adversely affect our ability to generate positive cashflows and secure financing required to carry out
our strategic plans.

Historically,
portions of our debt have been indexed to variable interest rates. A variety of factors impact prevailing interest rates of which we
have no control over. A rise in interest rates could negatively impact the cost of financing for a portion of our debt with variable
interest rates which could negatively impact our cash flow generation. Furthermore, a rise in interest rates could limit our ability
to obtain financing required to support our growth through our continuing programs designed to develop new products, the expand of the
installed capacity of our manufacturing facilities and execute our acquisition strategy. While we may mitigate the risk derived from
interest rate fluctuations by entering into derivative contracts or by obtaining fixed rate financing, general increases in interest
rates would still have an impact on the cost of financing and our ability to obtain appropriate funding.

Furthermore,
the architectural glass industry is directly impacted by general construction activity trends. In turn, these markets may be affected
by adverse changes in economic conditions such as interest rates, and availability of credit. Any future downturn or any other negative
market pressures could negatively affect our results of operations in the future, as margins may decrease as a direct result of an overall
decrease in demand for our products.

25

Our
indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations.

As
of December 31, 2025, we and our subsidiaries on a consolidated basis had $174.4 million principal amount of debt outstanding. Our indebtedness
could have negative consequences to our financial health. For example, it could:

Any
of the above listed factors could have a material adverse effect on our business, financial condition and results of operations. Further,
the terms of our existing debt agreements do not, and any future debt may not, fully prohibit us from incurring additional debt. If new
debt is added to our current debt levels, the related risks that we now face could intensify.

Risks
Related to Colombia and Other Countries Where We Operate

Our
operations are located in Colombia, which may make it more difficult for U.S. investors to understand and predict how changing market
and economic conditions will affect our financial results.

Our
operations are located in Colombia and, consequently, are subject to the economic, political and tax conditions prevalent in that country.
The economic conditions in Colombia are subject to different growth expectations, market weaknesses and business practices than economic
conditions in the U.S. market. We may not be able to predict how changing market conditions in Colombia will affect our financial results.

During
2025, Moody’s, S&P and Fitch, three of the main rating agencies worldwide, downgraded Colombia’s credit profile due to
weakening public finances, with Moody’s lowering its rating to “Baa3” while keeping a stable outlook as fiscal metrics
deteriorated beyond original plans, S&P cutting its sovereign rating to “BB” with a negative look, and Fitch also downgrading
the long-term foreign currency rating to “BB” amid persistently large fiscal deficits, rising public debt and challenges
in fiscal consolidation, mirroring market concerns over the country’s fiscal trajectory even as moderate growth continued and inflation
pressures eased during the year. Colombia’s macroeconomic performance in 2025 showed a moderation in growth and inflation dynamics.
Official data and projections indicate the country’s GDP is expected to increase around 2%-3%, while inflation closed at 5.1%,
above the central bank’s 3% target, and similar to the 5.2% inflation rate of 2024. In addition, Colombia’s central bank
(Banco de la República) is maintaining a restrictive monetary stance, raising its monetary policy interest rate 100 basis points
to 10.25%, largely due to strong internal demand and cost pressures including significant labor cost increases from a higher minimum
wage declared for 2026.

Colombia’s
economy, just like most of Latin-American countries, continues suffering from the effects of high volatility in commodity prices, mainly
oil, reflected in its elevated level of external debt. Even though the country has taken measures to stabilize the economy, it is uncertain
how will these measures be perceived and if the intended goal of increasing investor’s confidence will be achieved.

26

Economic
and political conditions in Colombia may have an adverse effect on our financial condition and results of operations.

Our
financial condition and results of operations depend significantly on macroeconomic and political conditions prevailing in Colombia.
Decreases in the growth rate, periods of negative growth, increases in inflation, changes in law, regulation, policy, or future judicial
rulings and interpretations of policies involving exchange controls and other matters such as (but not limited to) currency depreciation,
foreign exchange regulations, inflation, interest rates, taxation, employment and labor laws, banking laws and regulations and other
political or economic developments in or affecting Colombia may affect the overall business environment and may, in turn, adversely impact
our financial condition and results of operations in the future. Colombia’s fiscal deficit and growing public debt could adversely
affect the Colombian economy. See “Disclosure Regarding Foreign Exchange Rates in Colombia” and “Risk Factors –
Risks Related to Colombia and Other Countries Where We Operate – The Colombian government and the Central Bank exercise significant
influence on the Colombian economy”.

The
Colombian government frequently intervenes in Colombia’s economy and from time to time makes significant changes in monetary, fiscal
and regulatory policy. Our business and results of operations or financial condition may be adversely affected by changes in government
or fiscal policies, and other political, diplomatic, social, and economic developments that may affect Colombia. We cannot predict what
policies the Colombian government will adopt and whether those policies would have a negative impact on the Colombian economy or on our
business and financial performance in the future. We cannot assure you as to whether current stability in the Colombian economy will
be sustained. If the conditions of the Colombian economy were to deteriorate, our financial conditions and results of operations would
be adversely affected.

The
Colombian government has historically exercised substantial influence on the local economy, and governmental policies are likely to continue
to have an important effect on companies operating in Colombia like our Colombian subsidiaries, market conditions and the prices of the
securities of local issuers. The President of Colombia has considerable power to determine governmental policies and actions relating
to the economy and may adopt policies that may negatively affect us. We cannot predict which policies will be adopted by the new government
and whether those policies would have a negative impact on the Colombian economy in which we operate or our business and financial performance.

In
2026, Colombia will hold national elections, including Congressional elections on March 8, 2026 and the first round of presidential elections
on May 31, 2026. We cannot assure you that measures adopted by the Colombian government under its new regime continue to be consistent
with former policy and will not affect the country’s overall economic outlook and performance. The new leadership may have negative
effects on macroeconomic stability and therefore on the construction industry as a whole and finally, on the company’s operations
and future prospects. Recent events also underscore the potential for policy volatility and legal uncertainty: in January 2026, Colombia’s
Constitutional Court provisionally suspended Decree 1390 of December 22, 2025, which declared a state of economic and social emergency,
pending a final decision on its constitutionality, and any similar measures—whether adopted, modified, suspended or invalidated—could
create uncertainty and impact economic conditions relevant to our business. Although we don’t estimate a significant effect in
the short term based on current backlog and ongoing activity, it is uncertain as to how a new regime could affect our business in the
longer term. In addition, we cannot predict the effects that such policies will have on the Colombian economy. Furthermore, we cannot
assure you that the Colombian peso will not depreciate relative to the US dollar or other currencies in the future, which could have
a materially adverse effect on our financial condition.

The
Colombian Government and the Central Bank exercise significant influence on the Colombian economy.

Although
the Colombian government has not imposed foreign exchange restrictions since 1990, Colombia’s foreign currency markets have historically
been extremely regulated. Colombian law permits the Central Bank to impose foreign exchange controls to regulate the remittance of dividends
and/or foreign investments in the event that the foreign currency reserves of the Central Bank fall below a level equal to the value
of three months of imports of goods and services into Colombia. An intervention that precludes our Colombian subsidiaries from possessing,
utilizing or remitting U.S. Dollars would impair our financial condition and results of operations, and would impair the Colombian subsidiary’s
ability to convert any dividend payments to U.S. Dollars.

The
Colombian government and the Central Bank may also seek to implement new policies aimed at controlling further fluctuation of the Colombian
peso against the U.S. Dollar and fostering domestic price stability. The Central Bank may impose certain mandatory deposit requirements
in connection with foreign-currency denominated loans obtained by Colombian residents, including TG and ES. We cannot predict or control
future actions by the Central Bank in respect of such deposit requirements, which may involve the establishment of a different mandatory
deposit percentage. The U.S. Dollar/Colombian peso exchange rate has shown some instability in recent years. Please see “Disclosure
Regarding Foreign Exchange Controls and Exchange Rates in Colombia” for actions the Central Bank could take to intervene in the
exchange market.

27

The
Colombian Government has considerable power to shape the Colombian economy and, consequently, affect the operations and financial performance
of businesses. The Colombian Government may seek to implement new policies aimed at controlling further fluctuation of the Colombian
peso against the U.S. Dollar and fostering domestic price stability. The president of Colombia has considerable power to determine governmental
policies and actions relating to the economy and may adopt policies that are inconsistent with those of the prior government or that
negatively affect us.

Factors
such as Colombia’s growing public debt and fluctuating exchange rates could adversely affect the Colombian economy.

Colombia’s
fiscal deficit and growing public debt could adversely affect the Colombian economy. During 2024, Colombia’s fiscal deficit represented
6.8% of its GDP, related to increased government spending to fund new social and environmental reforms, and lower expected tax collections
during the year. in 2025 the deficit widened even further, driven by sustained high spending and weaker revenues, with estimates suggesting
Colombia’s fiscal deficit could reach around 7.1% of GDP, its highest level outside the pandemic era, even as tax revenue projections
were revised and the statutory fiscal rule was suspended to accommodate larger deficits. This persistent and growing fiscal gap has added
pressure on sovereign credit profiles, contributed to credit rating downgrades and could lead to higher interest rates on new Colombian
sovereign debt issuances.

In
recent years, the Colombian currency had shown some short-term volatility vis-à-vis the U.S. Dollar. The Colombian Peso appreciated
14.8% in 2025, after a 15.4% depreciation during 2024. Any international conflicts or related events have the potential to create an
exchange mismatch, given the vulnerability and dependence of the Colombian economy on external financing and its vulnerability to any
disruption in its external capital flows and its trade balance.

We
cannot assure you that any measures taken by the Colombian government and the Central Bank would be sufficient to control any resulting
fiscal or exchange imbalances. Any further disruption in Colombia’s fiscal and trade balance may therefore cause Colombia’s
economy to deteriorate and adversely affect our business, financial condition and results of operations.

Economic
instability in Colombia could negatively affect our ability to sell our products.

A
significant decline in economic growth of any of Colombia’s major trading partners - in particular, the United States, China, and
Mexico - could have a material adverse effect on each country’s balance of trade and economic growth. In addition, a “contagion”
effect, where an entire region or class of investments becomes less attractive to, or subject to outflows of funds by, international
investors could negatively affect the Colombian economy.

Even
though exports from Colombia, principally petroleum and petroleum products, and gold, have grown in recent years, fluctuations in commodity
prices pose a significant challenge to their contribution to the country’s balance of payments and fiscal revenues. Unemployment
continues to be high in Colombia compared to other economies in Latin America. Furthermore, recent political and economic actions in
the Latin American region, including actions taken by United States in relation to the Venezuelan government, may negatively affect international
investor perception of the region. We cannot assure you that growth achieved over the past decade by the Colombian economy will continue
in future periods. The long-term effects of the global economic and financial crisis on the international financial system remain uncertain.
In addition, the effect on consumer confidence of any actual or perceived deterioration of household incomes in the Colombian economy
may have a material adverse effect on our results of operations and financial condition.

28

We
are dependent on sales to customers outside Colombia and any failure to make these sales may adversely affect our operating results in
the future.

In
the year ended December 31, 2025, 96.8% of our sales were to customers outside Colombia, including to the United States and Panama, and
we expect sales into the United States and other foreign markets to continue to represent a significant portion of our net sales. Foreign
sales and operations are subject to changes in local government regulations and policies, including those related to tariffs and trade
barriers, investments, property ownership rights, taxation, exchange controls and repatriation of earnings. An increase in tariffs on
products shipped to countries like the United States, or changes in the relative values of currencies occur from time to time and could
affect our operating results. This risk and the other risks inherent in foreign sales and operations could adversely affect our operating
results in the future.

Our
business could be negatively impacted by potential tariffs imposed by the U.S government and trade tensions between the U.S. and Colombia.

The
United States has imposed import tariffs on certain steel and aluminum articles under Section 232 of the Trade Expansion Act of 1962,
and these measures have been adjusted over time through proclamations and related administrative actions (including changes to product
coverage, rates, exclusions and enforcement). In addition, on April 2, 2025, the President issued Executive Order 14257, which directed
that imported articles be subject to an additional 10% ad valorem duty pursuant to a declared national emergency under the International
Emergency Economic Powers Act (IEEPA), with specified effective dates. Multiple lawsuits have challenged the President’s authority
to impose tariffs under IEEPA and stays and ongoing appeals have contributed to uncertainty regarding the ultimate outcome and any related
changes to scope, duration, or potential refunds. The adoption, modification or escalation of these or other tariff regimes, as well
as retaliatory measures by other countries, could materially and adversely affect our business, financial condition and results of operations.

Given
that our primary manufacturing facilities are located in Colombia and approximately 94.8% of our sales for the fiscal year ended December
31, 2025, were generated in the United States, these tariffs directly increase our costs and may pressure our profit margins.

In
response to these trade barriers, we have strategically shifted our supply chain to source U.S.-casted aluminum, which has allowed us
to mitigate a portion of the financial impact. However, despite these mitigation efforts, any further escalation in tariff rates, the
potential removal of U.S.-Colombia Trade Promotion Agreement benefits, or retaliatory measures by the Colombian government could still
disrupt our supply chain and reduce our price competitiveness. Such developments could have a material adverse effect on our financial
condition and results of operations.

We
are subject to trade investigations conducted by U.S. authorities over Colombian products that may result in additional duties for our
products.

In
2024 a coalition of U.S. producers of aluminum extrusions filed a petition with U.S. trade authorities requesting the imposition of anti-dumping
duties against imports of aluminum extrusions from Colombia. As we are the main extruder of aluminum in Colombia, we volunteered as a
mandatory respondent in the investigation and provided certain requested information. As a result of this investigation, imports of some
of our goods which are considered subject merchandise were subject to anti-dumping duties, until the International Trade Commission concluded
in October 21, 2024 that American Aluminum producers were not being harmed and revoked said anti-dumping duty which as of today remain
in zero.

If
such an anti-dumping measure were to be imposed, it might adversely impact our results of operations

We
are subject to regional and national economic conditions in the United States.

The
economy in Florida and throughout the United States could negatively impact demand for our products as it has in the past, and macroeconomic
forces such as employment rates and the availability of credit could have an adverse effect on our sales and results of operations. Our
U.S. business is concentrated geographically in Florida, which optimizes manufacturing efficiencies and logistics, but further concentrates
our business, and another prolonged decline in the economy of the state of Florida or of nearby coastal regions, a change in state and
local building code requirements for hurricane protection, or any other adverse condition in the state or certain coastal regions, could
cause a decline in the demand for our products, which could have an adverse impact on our sales and results of operations. Our strategy
of continued geographic diversification seeks to reduce our exposure to such region-specific risks.

29

Armed
conflicts around the globe, including sanctions and tensions between United States, NATO allies and several eastern countries, may adversely
affect the results of our operations.

Armed
conflicts around the globe, including sanctions and heightened geopolitical tensions involving the United States, NATO allies and other
countries, may adversely affect the results of our operations.

The
Russian invasion of Ukraine starting in February 2022 has contributed to elevated global tensions and the imposition of economic sanctions
and trade restrictions between the United States, the European Union and other countries.

In
addition, attacks and security threats in and around the Red Sea associated with Yemen’s Houthi group, and related military tensions
involving the United States and certain allies, have disrupted maritime trade and affected shipping patterns for certain carriers, including
through the Suez Canal corridor, resulting in rerouting, longer transit times and increased freight costs in certain periods.

These
measures, together with broader conflict-related uncertainty, can lead to severe constraints on global supply chains, raw material price
increases and shortages, and higher energy costs. Disruptions in global supply chains can adversely affect our ability to manufacture
and deliver products to our customers. Additionally, fluctuating foreign currency exchange rates could impact on the profitability of
our foreign subsidiaries which are at the core of our business.

Geopolitical
instability in the Americas may also increase regional volatility. On January 3, 2026, U.S. forces captured Venezuelan President Nicolás
Maduro in a military operation, which has heightened uncertainty regarding regional stability, diplomatic relations and sanctions policy.

Colombia
has experienced and continues to experience internal security issues that have had or could have a negative effect on the Colombian economy
and our financial condition.

Colombia
has experienced, and continues to experience, internal security challenges that could adversely affect the Colombian economy and our
business, results of operations and financial condition. These challenges include the activities of illegal armed groups—including
the National Liberation Army (ELN), dissident factions formerly associated with the Revolutionary Armed Forces of Colombia (FARC), paramilitary
successor groups and criminal organizations involved in narcotrafficking—which in certain regions engage in intimidation, extortion,
and attacks that can disrupt commerce, transportation and governmental presence. Although Colombia has implemented peace and related
security initiatives over time, violence and criminal activity persist and may escalate, and the government’s evolving security
strategy may affect operating conditions for businesses in Colombia. Any deterioration in security conditions could negatively affect
demand in the construction industry, the safety and availability of our employees and contractors, our logistics and supply chain, and
overall economic and foreign-exchange stability in Colombia.

Despite
efforts by the Colombian government, drug-related crime, guerrilla paramilitary activity and criminal bands continue to exist in Colombia,
and allegations have surfaced regarding members of the Colombian congress and other government officials having ties to guerilla and
paramilitary groups. Although the Colombian government and ELN have been in talks since February 2017 to end a five-decade war, the Colombian
government has suspended the negotiations after a series of rebel attacks. This situation could result in escalated violence by the ELN
and may have a negative impact on the credibility of the Colombian government which could in turn have a negative impact on the Colombian
economy.

Tensions
with neighboring countries, including Venezuela and other Latin American countries, may affect the Colombian economy and, consequently,
our results of operations and financial condition in the future.

Diplomatic
relations with Venezuela and other neighboring countries have from time to time been tense, including due to developments along Colombia’s
border with Venezuela. Political and diplomatic uncertainty in Venezuela increased following the country’s presidential election
held on July 28, 2024, which produced disputed results and mixed international recognition. In addition, on January 3, 2026, U.S. forces
captured Venezuelan President Nicolás Maduro in a military operation, which has contributed to heightened regional uncertainty
and could affect diplomatic relations, sanctions policy, cross-border commerce, and overall economic conditions in the region. Moreover,
in November 2012, the International Court of Justice placed a sizeable area of the Caribbean Sea within Nicaragua’s exclusive economic
zone. As of the date of this Annual Report, Colombia continues to deem this area as part of its own exclusive economic zone. Any future
deterioration in relations with Venezuela and Nicaragua may result in the closing of borders, risk of financial condition.

Government
policies and actions and judicial decisions in Colombia could significantly affect the local economy and, as a result, our results of
operations and financial condition in the future.

Our
results of operations and financial condition may be adversely affected by changes in Colombian governmental policies and actions and
judicial decisions involving a broad range of matters, including interest rates, exchange rates, exchange controls, inflation rates,
taxation, banking and pension fund regulations and other political or economic developments affecting Colombia. The Colombian government
has historically exercised substantial influence over the economy, and its policies are likely to continue to have a significant effect
on Colombian companies, including our subsidiaries. The President of Colombia has considerable power to determine governmental policies
and actions relating to the economy and may adopt policies that negatively affect our subsidiaries. Future governmental policies and
actions, or judicial decisions, could adversely affect our results of operations or financial condition.

We
are subject to money laundering and terrorism financing risks.

Third
parties may use us as a conduit for money laundering or terrorism financing. If we were to be associated with money laundering (including
illegal cash operations) or terrorism financing, our reputation could suffer, or we could be subject to legal enforcement (including
being added to “blacklists” that would prohibit certain parties from engaging in transactions with us). Our Colombian subsidiaries
could also be sanctioned pursuant to criminal anti-money laundering rules in Colombia.

We
have adopted a Code of Conduct, Compliance Manual which includes policies and procedures and help surveil and control our activities
and a hotline to receive anonymous reports. However, such measures, procedures and compliance may not be completely effective in preventing
third parties from using us as a conduit for money laundering or terrorism financing without our knowledge, which could have a material
adverse effect on our business, financial condition and results of operations.

30

Changes
in Colombia’s customs, import and export laws and foreign policy, may have an adverse effect on our financial condition and results
of operations.

Our
business depends significantly on Colombia’s customs and foreign exchange laws and regulations, including import and export laws,
as well as on fiscal and foreign policies. In the past we have benefited from, and now currently benefit from, certain customs and tax
benefits granted by Colombian laws, such as free trade zones and Plan Vallejo which incentivizes the import of machinery and equipment
by providing tax breaks, as well as from Colombian foreign policy, such as free trade agreements with countries like the United States.
As a result, our business and results of operations or financial condition may be adversely affected by changes in government or fiscal
policies, foreign policy or customs and foreign exchange laws and regulations. We cannot predict what policies the Colombian government
will adopt and whether those policies would have a negative impact on the Colombian economy or on our business and financial performance
in the future.

It
may be difficult or impossible to enforce judgments of courts of the United States and other jurisdictions against our Colombian subsidiaries
or any of their directors, officers and controlling persons.

Most
of our assets are located in Colombia. As such, it may be difficult or impossible for you to effect service of process on, or to enforce
judgments of United States courts against our Colombian subsidiaries and/or against their directors and officers based on the civil liability
provisions of the U.S. federal securities laws.

Colombian
courts will enforce a U.S. judgment predicated on the U.S. securities laws through a procedural system known under Colombian law as exequatur.
Colombian courts will enforce a foreign judgment, without reconsideration of the merits, only if the judgment satisfies the requirements
set out in Articles 605 through 607 of Law 1564 of 2012, or the Colombian General Code of Procedure (Código General del Proceso),
which provides that the foreign judgment will be enforced if certain conditions are met.

New
or higher taxes resulting from changes in tax regulations or the interpretation thereof in Colombia could adversely affect our results
of operations and financial condition in the future.

New
tax laws and regulations, and uncertainties with respect to future tax policies pose risks to us. In recent years, the Colombian Congress
approved different tax reforms imposing additional taxes and enacted modifications to existing taxes related to financial transactions,
dividends, income, value added tax (VAT), and taxes on net worth.

On
December 13, 2022, a tax reform was enacted by means of Law 2277, which maintained corporate income tax rate at 35%, and increased income
taxes to Free Trade Zones with single enterprise users and non-exporters, from 20% to 35%. We cannot predict whether Colombia will adopt
additional tax reforms, surcharges, or other fiscal measures in the future, or how any such measures may be interpreted or applied to
us, any of which could materially adversely affect our business, results of operations and financial condition.

Changes
in tax-related laws and regulations, and interpretations thereof, can create additional tax burdens on us and our businesses by increasing
tax rates and fees, creating new taxes, limiting tax deductions, and/or eliminating tax-based incentives and non-taxed income. In addition,
tax authorities and competent courts may interpret tax regulations differently than us, which could result in tax litigation and associated
costs and penalties in part due to the novelty and complexity of new regulation.

Beyond
taxation, regulatory changes to labor laws in Colombia may also impact our cost structure. A new labor reform, passed on October 17,
2024, introduced changes to night and weekend pay, including an earlier start for nightly surcharges and increased extra pay for these
shifts. Additionally, the ongoing phased reduction of the workweek, which is set to reach 42 hours by 2026, may further impact labor
costs. These changes could increase our operational expenses and affect profitability and workforce management.

As
regulatory environments evolve, new or heightened financial and operational obligations could materially and adversely affect our business.

31

We
are subject to various U.S. export controls and trade and economic sanctions laws and regulations that could impair our ability to compete
in international markets and subject us to liability if we are not in full compliance with applicable laws.

Our
business activities are subject to various U.S. export controls and trade and economic sanctions laws and regulations, including, without
limitation, the U.S. Commerce Department’s Export Administration Regulations and the U.S. Treasury Department’s Office of
Foreign Assets Control’s (“OFAC”) trade and economic sanctions programs (collectively, “Trade Controls”).
Such Trade Controls may prohibit or restrict our ability to, directly or indirectly, conduct activities or dealings in or with certain
countries that are the subject of comprehensive embargoes (presently, Cuba, Iran, North Korea, Syria, and the Crimea region of Ukraine
(collectively, “Sanctioned Countries”)), as well as with individuals or entities that are the target of Trade Controls-related
prohibitions and restrictions (collectively, “Sanctioned Parties”).

Although
we have implemented compliance measures designed to prevent transactions with Sanctioned Countries and Sanctioned Parties, our failure
to successfully comply with applicable Trade Controls may expose us to negative legal and business consequences, including civil or criminal
penalties, government investigations, and reputational harm.

Natural
disasters in Colombia could disrupt our business and affect our results of operations and financial condition in the future.

Our
operations are exposed to natural disasters and extreme weather events in Colombia, such as earthquakes, volcanic eruptions, floods,
landslides, tornadoes, tropical storms and hurricanes. Climate variability, including El Niño and La Niña conditions, can
contribute to higher temperatures and reduced rainfall (or, in La Niña periods, heavier rainfall), which may increase the risk
of droughts, water restrictions, floods, landslides, wildfires, or other natural disasters on an equal or greater scale in the future.
Because Colombia’s electricity generation relies heavily on hydropower, drought conditions may increase the risk of higher electricity
costs or supply constraints. In the event of a natural disaster, our disaster recovery plans may prove to be ineffective, which could
have a material adverse effect on our ability to conduct our businesses. In addition, if a significant number of our employees and senior
managers were unavailable because of a natural disaster, our ability to conduct our businesses could be compromised. Natural disasters
or similar events could also result in substantial volatility in our results of operations for any fiscal quarter or year.

Risks
Related to Us and Our Securities

Because
we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to
protect your rights through the U.S. Federal courts may be limited.

We
are a company incorporated under the laws of the Cayman Islands, and substantially all of our assets are located outside the United States.
In addition, a majority of our directors and officers are nationals or residents of jurisdictions other than the United States and all
or substantial portions of their assets are located outside the United States. As a result, it may be difficult for investors to effect
service of process within the United States upon our directors or executive officers, or enforce judgments obtained in the United States
courts against our directors or officers.

Our
corporate affairs are governed by our third amended and restated memorandum and articles of association, the Companies Law (2018 Revision)
of the Cayman Islands (as the same may be supplemented or amended from time to time) and the common law of the Cayman Islands. The rights
of shareholders to take action against the directors, actions by minority shareholders and the fiduciary responsibilities of our directors
to us under Cayman Islands law are largely governed by the common law of the Cayman Islands. The common law of the Cayman Islands is
derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, the decisions
of whose courts are of persuasive authority, but are not binding on a court in the Cayman Islands. The rights of our shareholders and
the fiduciary responsibilities of our directors under Cayman Islands law are different from what they would be under statutes or judicial
precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws as compared
to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate
law. In addition, Cayman Islands companies may not have standing to initiate a shareholder’s derivative action in a Federal court
of the United States.

32

We
have been advised that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the
United States predicated upon the civil liability provisions of the securities laws of the United States or any State; and (ii) in original
actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the securities
laws of the United States or any State, so far as the liabilities imposed by those provisions are penal in nature. In those circumstances,
although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman
Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits
based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for
which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such
judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent
with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, and or be
of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or
multiple damages may well be held to be contrary to public policy). A Cayman Islands Court may stay enforcement proceedings if concurrent
proceedings are being brought elsewhere. There is recent Privy Council authority (which is binding on the Cayman Islands Court) in the
context of a reorganization plan approved by the New York Bankruptcy Court which suggests that due to the universal nature of bankruptcy/insolvency
proceedings, foreign money judgments obtained in foreign bankruptcy/insolvency proceedings may be enforced without applying the principles
outlined above. However, a more recent English Supreme Court authority (which is highly persuasive but not binding on the Cayman Islands
Court), has expressly rejected that approach in the context of a default judgment obtained in an adversary proceeding brought in the
New York Bankruptcy Court by the receivers of the bankruptcy debtor against a third party, and which would not have been enforceable
upon the application of the traditional common law principles summarized above and held that foreign money judgments obtained in bankruptcy/insolvency
proceedings should be enforced by applying the principles set out above, and not by the simple exercise of the Courts’ discretion.
Those cases have now been considered by the Cayman Islands Court. The Cayman Islands Court was not asked to consider the specific question
of whether a judgment of a bankruptcy court in an adversary proceeding would be enforceable in the Cayman Islands, but it did endorse
the need for active assistance of overseas bankruptcy proceedings. We understand that the Cayman Islands Court’s decision in that
case has been appealed and it remains the case that the law regarding the enforcement of bankruptcy/insolvency related judgments is still
in a state of uncertainty.

If
we fail to maintain proper and effective internal controls, our ability to produce accurate financial statements could be impaired, which
could adversely affect our business.

Our
financial reporting obligations as a public company place a significant strain on our management, operational and financial resources,
and systems. We may not be able to implement effective internal controls and procedures to detect and prevent errors in our financial
reports, file our financial reports on a timely basis in compliance with SEC requirements, or prevent and detect fraud. Our management
may not be able to respond adequately to changing regulatory compliance and reporting requirements. If we are not able to adequately
implement the requirements of Section 404, we may not be able to assess whether internal controls over financial reporting are effective,
which may subject us to adverse regulatory consequences and could harm investor confidence, the market price of our ordinary shares and
our ability to raise additional capital.

Anti-takeover
provisions in our organizational documents and Cayman Islands law may discourage or prevent a change of control, even if an acquisition
would be beneficial to our shareholders, which could depress the price of our ordinary shares and prevent attempts by our shareholders
to replace or remove our current management.

Our
memorandum and articles of association contain provisions that may discourage unsolicited takeover proposals that shareholders may consider
to be in their best interests. Our board of directors is divided into three classes with staggered, three-year terms. Our board of directors
has the ability to designate the terms of and issue preferred shares without shareholder approval. We are also subject to certain provisions
under Cayman Islands law that could delay or prevent a change of control. Together these provisions may make more difficult the removal
of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our
ordinary shares.

We
cannot assure you that we will continue to pay dividends on our ordinary shares, and our indebtedness, future investments or cashflow
generation could limit our ability to continue to pay dividends on our ordinary shares.

Prior
to August 2016, we had not paid any dividends on our ordinary shares. Since such time, we have paid regular quarterly dividends. However,
the payment of dividends in the future, if any, will be contingent upon our revenues and earnings, if any, capital requirements and our
general financial condition and limitations imposed by our outstanding indebtedness.

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If
securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price
and trading volume could decline.

The
trading market for our ordinary shares relies in part on the research and reports that industry or financial analysts publish about us
or our business. We do not control these analysts. Furthermore, if one or more of the analysts who do cover us downgrade our stock or
our industry, or the stock of any of our competitors, or publish inaccurate or unfavorable research about our business, the price of
our stock could decline. If one or more of these analysts ceases coverage of us or fail to publish reports on us regularly, we could
lose visibility in the market, which in turn could cause our stock price or trading volume to decline.

If
a United States person is treated as owning at least 10% of the value or voting power of our shares, such holder may be subject to adverse
U.S. federal income tax consequences.

If
a United States person is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of our
shares, such person may be treated as a “United States shareholder” with respect to each “controlled foreign corporation”
in our group (if any). While our parent company owns one or more U.S. subsidiaries, we, and certain of our non-U.S. subsidiaries, could
be treated as controlled foreign corporations. Furthermore, while our group includes one or more U.S. subsidiaries, certain of our non-U.S.
subsidiaries could be treated as controlled foreign corporations (regardless of whether or not we are treated as a controlled foreign
corporation). A United States shareholder of a controlled foreign corporation generally is required to report annually and include in
its U.S. taxable income its pro rata share of “Subpart F income,” “global intangible low-taxed income” and investments
in U.S. property by controlled foreign corporations, regardless of whether we make any such United States shareholder receives any actual
distributions. An individual that is a United States shareholder with respect to a controlled foreign corporation generally would not
be allowed certain tax deductions or foreign tax credits that would be allowed to a United States shareholder that is a U.S. corporation.
Failure to comply with these reporting obligations may subject a United States shareholder to significant monetary penalties and may
prevent the statute of limitations with respect to such shareholder’s U.S. federal income tax return for the year for which reporting
was due from starting. We cannot provide any assurances that we will assist investors in determining whether any of our non-U.S. subsidiaries
are treated as a controlled foreign corporation or whether any investor is treated as a United States shareholder with respect to any
of such controlled foreign corporations or furnish to any United States shareholders information that may be necessary to comply with
the aforementioned reporting and tax paying obligations. There is substantial uncertainty as to the application of each of the foregoing
rules as well as the determination of any relevant calculations in applying the foregoing rules. United States persons are strongly advised
to avoid acquiring, directly, indirectly or constructively, 10% or more of the value or voting power of our shares. A United States investor
should consult its advisors regarding the potential application of these rules to an investment in the ordinary shares.

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We
may be adversely affected by any disruption in our information technology systems. Our operations are dependent upon our information
technology systems, which encompass all of our major business functions.

Increased
global information technology security requirements, vulnerabilities, threats and a rise in sophisticated and targeted cybercrime pose
a risk to the security of our systems, our information networks, and to the confidentiality, availability and integrity of our data,
as well as to the functionality of our manufacturing process. Introduced or increased risk associated with remote work transition pose
threats to workforce disruption, cybersecurity attacks and dissemination of sensitive personal data or proprietary confidential information
to our business. A disruption in our information technology systems for any prolonged period could result in delays in executing certain
production activities, logging and processing operational and financial data, communication with employees and third parties or fulfilling
customer orders resulting in potential liability or reputational damage or otherwise adversely affect our financial results. We employ
a number of measures to prevent, detect and mitigate these threats, which include employee education, password encryption, frequent password
change events, firewall detection systems, anti-virus software in-place and frequent backups; however, there is no guarantee such efforts
will be successful in preventing a cyber-attack.