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 UNITED
STATES

 SECURITIES
AND EXCHANGE COMMISSION

 WASHINGTON,
D.C. 20549

 FORM

 ANNUAL
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the fiscal year ended December 31, 2023

 OR

 TRANSITION
 REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For
the transition period from to

 Commission
File No. 001-37707

 iSUN,
INC.

 (Exact
name of registrant as specified in its charter)

 Delaware

 47-2150172

 (State
 or other jurisdiction of

 incorporation
 or organization)

 (I.R.S.
 Employer

 Identification
 Number)

 Avenue D, Suite 10

 Williston,
 Vermont

 05495

 (Address
 of Principal Executive Offices)

 (Zip
 Code)

 (802) 658-3378

 (Registrant's
telephone number)

 Securities
registered pursuant to Section 12(b) of the Act:

 Title
 of each class

 Trading
 Symbol(s)

 Name
 of each exchange on which registered

 Common
 Stock, $0.0001 par value

 ISUN

 Nasdaq
 Capital Market

 Common
Stock, Par Value $0.0001

 (Title
of class)

 Securities
registered pursuant to Section 12(g) of the Act: NONE

by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes
 No

by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and, (2)
has been subject to such filing requirements for the past 90 days. Yes No

by check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted pursuant
to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit). Yes No

by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained
herein and, will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated
by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company,
or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller
reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large
 accelerated filer

 Accelerated
 filer

 Non-accelerated
 filer

 Smaller
 reporting company

 Emerging
 growth company

 If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness
of internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262 (b)) by the registered public
accounting firm that prepared or issued its audit report.

 If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.

 YES
 NO

by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

 YES
 NO

by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES NO

 The
aggregate market value of the Common Stock held by non-affiliates as of June 30, 2023 was $ 7.6 million.

 The
number of shares of the Registrant's Common Stock outstanding as of April 12, 2024 was 47,384,672.

 TABLE
OF CONTENTS

 Item
 1.

 Business

 Item
 1A.

 Risk Factors

 Item
 1B.

 Unresolved Staff Comments

 Item
 1C.

 Cybersecurity

 Item
 2.

 Properties

 Item
 3.

 Legal Proceedings

 Item
 4.

 Mine Safety Disclosures

 Item
 5.

 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item
 6.

 Reserved

 Item
 7.

 Management's Discussion and Analysis of Financial Condition and Results of Operations

 Item
 7A.

 Quantitative and Qualitative Disclosures About Market Risk

 Item
 8.

 Financial Statements and Supplementary Data

 Item
 9.

 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 Item
 9A.

 Controls and Procedures

 Item
 9B.

 Other Information

 Item
 9C.

 Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

 Item
 10.

 Directors, Executive Officers and Corporate Governance

 Item
 11.

 Executive Compensation

 Item
 12.

 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item
 13.

 Certain Relationships and Related Transactions and Director Independence

 Item
 14.

 Principal Accountant Fees and Services

 Item
 15.

 Exhibits and Financial Statement Schedules

 Item
 16.

 Form 10-K Summary

 SUMMARY
RISK FACTORS

 Investing
in our shares of Common Stock involves numerous risks, including the risks described in "Part I—Item 1A. Risk Factors"
of this Annual Report on Form 10-K. Below are some of our principal risks, any one of which could materially adversely affect our business,
financial condition, results of operations, and prospects:

 If
 there is a subsequent wave of the coronavirus pandemic (COVID-19) it will likely impact general market and economic conditions and
 is likely to have a material adverse effect on our business and results of operations.

 The
 Russia-Ukraine conflict and the impact of related sanctions may impact our business.

 The
 Mideast conflict and related shipping disruptions may impact our business.

 We
 operated at a loss in 2023 and 2022, and cannot predict when or if we will achieve profitability.

 Our
 management discovered a material weakness in our disclosure controls and procedures and internal control over financial reporting
 as required to be implemented by Section 404 of the Sarbanes-Oxley Act of 2002.

 We
 might not be able to continue as a going concern, which would likely cause our stockholders
 to lose most or all of their investment.

 A
 material reduction in the retail price of traditional utility generated electricity or electricity from other sources could harm
 our business, financial condition, results of operations and prospects.

 Existing
 electric utility industry regulations, and changes to regulations, may present technical, regulatory and economic barriers to the
 purchase and use of solar energy systems that may significantly reduce demand for our solar energy systems.

 Our
 growth strategy depends on the widespread adoption of solar power technology.

 Our
 business currently depends on the availability of rebates, tax credits and other financial incentives. The expiration, elimination
 or reduction of these rebates, credits and incentives would adversely impact our business.

 Our
 business depends in part on the regulatory treatment of third-party owned solar energy systems.

 Our
 ability to provide solar energy systems to residential customers on an economically viable basis depends on our ability to help customers
 arrange financing for such systems.

 We
 may not realize the anticipated benefits of completed and potential future acquisitions, and integration of these acquisitions may
 disrupt our business and operations.

 We
 will require additional financing to sustain our operations, without which we may not be able to maintain our business and operations,
 and the terms of subsequent financings may adversely impact our stockholders.

 The
 share price of our Common Stock is subject to fluctuation, has been and may continue to be volatile and may decline regardless of
 our operating performance, resulting in substantial losses for investors who have purchased shares of our Common Stock.

 If
 we experience a significant disruption in our information technology systems or if we fail to implement new systems and software
 successfully, our business could be adversely affected. A cyberattack could lead to a material disruption of our information technology
 systems or the IT systems of our third-party providers and the loss of business information, which may hinder our ability to conduct
 our business effectively and may result in lost revenues and additional costs.

 PART
I

 Item
 1.

 Business.

 Forward-looking
Statements

 Statements
in this Annual Report on Form 10-K that are not historical facts constitute forward-looking statements. Examples of forward-looking statements
include statements relating to industry prospects, our future economic performance including anticipated revenues and expenditures, results
of operations or financial position, and other financial items, our business plans and objectives, and may include certain assumptions
that underlie forward-looking statements. Risks and uncertainties that may affect our future results, levels of activity, performance
or achievements expressed or implied by these forward-looking statements include, among other things, those listed under "Risk
Factors" and elsewhere in this Annual Report.

 These
risks and uncertainties include but are not limited to:

 the
 potential impact of a subsequent wave of the COVID-19 pandemic on our business;

 Geopolitical risks related to the conflicts in Ukraine and the Middle East.

 our
 limited operating history;

 our
 ability to raise additional capital to maintain our business and operations and meet our objectives;

 our
 ability to compete in the solar power industry;

 our
 ability to sell solar power systems;

 our
 ability to arrange financing for our residential customers;

 government
 incentive programs related to solar energy;

 our
 ability to increase the size of our company and manage growth;

 our
 ability to acquire and integrate other businesses;

 disruptions
 to our supply chain from protective tariffs on imported components, supply shortages and/or fluctuations in pricing;

 our
 ability or inability to attract and/or retain competent employees;

 relationships
 with employees, consultants, customers, and suppliers; and

 the
 concentration of our business in one industry in limited geographic areas;

 In
some cases, you can identify forward-looking statements by terminology such as "may," "will," "should,"
"expects," "intends," "plans," "anticipates," "believes," "estimates,"
"predicts," "potential" or "continue" or the negative of these terms or other comparable terminology.

 These
statements are subject to business and economic risk and reflect management's current expectations and involve subjects that are
inherently uncertain and difficult to predict. Actual events or results may differ materially. Moreover, neither we nor any other person
assumes responsibility for the accuracy or completeness of these statements. We are under no duty to update any of the forward-looking
statements after the date of this Annual Report to conform these statements to actual results.

 Business
Introduction/Summary

 Throughout
our 50-year history, we have always embraced innovative change. There has never been a more meaningful, or impactful time to be a leader
in the innovation that will help fight climate change. We have built a team that is passionate about transitioning American power generation
and consumption to clean solar energy. We are passionately focused on our mission to accelerate the adoption of solar energy.

 We
are one of the largest solar energy services and infrastructure deployment companies in the country and are expanding across the United
States. Our services include solar, storage and electric vehicle infrastructure, design, development and professional services, engineering,
procurement, installation, O&M and storage. We uniquely target all solar markets including residential, commercial, industrial and
utility segments.

 Prior
to becoming a public company, we were a second-generation family business founded under the name Peck Electric Co. in 1972 as a
traditional electrical contractor. Our core values were and still are to align people, purpose, and profitability, and since taking
leadership in 1994, Jeffrey Peck, our Chief Executive Officer and Interim Chief Financial Officer, applied such core values to
expand into the solar industry. We are guided by the mission to facilitate the reduction of carbon emissions through the expansion
of clean, renewable energy and we believe that leveraging such core values to deploy resources to facilitate the adoption of solar
energy is the only sustainable strategy to achieve these objectives. We have positioned the company to serve all segments of the
rapidly evolving solar energy markets. We are able to originate valuable solar assets through our development and design services
team. We are able to leverage our digital sales and marketing capabilities to generate high quality leads for our Residential,
Commercial and Industrial and Utility divisions. Our experience provides for the high-quality craftsmanship required for installing
long-term assets for all customers. Our team approach allows us to collaborate across divisions in order to efficiently utilize our
internal labor resources. The diversity of our service offerings allows us to serve our customer needs in the evolving solar energy
environment.

 On
January 19, 2021, we completed a business combination (the "Merger Agreement") pursuant to which we acquired iSun Energy
LLC ("iSun Energy"). The Business Combination was an acquisition treated as a merger and reorganization and iSun Energy became
a wholly owned subsidiary of The Peck Company Holdings, Inc. Immediately prior to the business combination, we changed our name to iSun,
Inc. (the "Company").

 On
April 6, 2021, iSun Utility, LLC ("iSun Utility"), a Delaware limited liability company and wholly-owned subsidiary of the
Company, Adani Solar USA, Inc., a Delaware corporation (Adani"), and Oakwood Construction Services, Inc., a Delaware corporation
("Oakwood") entered into an Assignment Agreement (the "Assignment"), pursuant to which iSun Utility acquired
all rights to the intellectual property of Oakwood and its affiliates (the "Project IP"). Oakwood was a utility-scale solar
Engineering, Procurement, Construction, Development and Design company and a wholly-owned subsidiary of Adani. The Project IP included
all of the intellectual property, project references, templates, client lists, agreements, forms and processes of Adani's U.S.
solar business.

 On
September 8, 2021, iSun, Inc. entered into an Agreement and Plan of Merger (the "Merger Agreement") by and among the Company,
iSun Residential Merger Sub, Inc., a Vermont corporation (the "Merger Sub") and wholly-owned subsidiary of iSun Residential,
Inc., a Delaware corporation ("iSun Residential") and wholly-owned subsidiary of the Company, SolarCommunities, Inc., d/b/a
SunCommon, a Vermont benefit corporation ("SunCommon"), and Jeffrey Irish, James Moore, and Duane Peterson as a "Shareholder
Representative Group" of the holders of SunCommon's capital stock (the "SunCommon Shareholders"), pursuant to
which the Merger Sub merged with and into SunCommon (the "Merger") with SunCommon as the surviving company in the Merger
and SunCommon became a wholly-owned subsidiary of iSun Residential. The Merger was effective on October 1, 2021.

 We
now conduct all of our business operations exclusively through our direct and indirect wholly-owned subsidiaries, iSun Residential, Inc.,
SolarCommunities, Inc. iSun Industrial, LLC, Peck Electric Co., Liberty Electric, Inc., iSun Utility, LLC, iSun Energy, LLC and iSun
Corporate, LLC.

 The
world recognizes the need to transition to a reliable, renewable energy grid in the next 50 years. States from Vermont to Hawaii are
leading the way in the U.S. with renewable energy goals of 75% by 2032 and 100% by 2045, respectively. California committed to 100% carbon-free
energy by 2045. The majority of the other states in the U.S. also have renewable energy goals, regardless of current Federal solar policy.
We are a member of Renewable Energy Vermont, an organization that advocates for clean, practical and renewable solar energy. The benefits
of the newly enacted Inflation Reduction Act of 2022 ("IRA") provide stability and certainty of incentives for the next 10
years that create value to our shareholders and provides a long-term commitment for the energy transformation. Prior to the enactment
of the IRA, the federal investment tax credits associated with solar projects had a planned reduction to 22% and 10% in 2023 and 2024.
The IRA offers a stable tax rate over the next ten years as well as several potential adders to the fixed investment tax credit. These
credits increase the valuation of solar assets which provides margin protection on future projects. Our triple bottom line, which is
geared towards people, environment, and profit, has always been our guide since we began installing renewable energy and we intend that
it remain our guide over the next 50 years as we construct our energy future.

 We
primarily provide services to solar energy customers for projects ranging in size from several kilowatts for residential loads to multi-megawatt
systems for commercial, industrial and utility projects. To date, we have installed over 600 megawatts of solar systems since inception
and are focused on contracting projects that meet our margin objectives. We believe that we are well-positioned for what we believe to
be the coming transformation to an all renewable energy economy. We are expanding across the United States to serve the fast-growing
demand for clean renewable energy. We are open to partnering with others to accelerate our growth process, and we are planning to expand
our portfolio of company-owned solar arrays to establish recurring revenue streams for many years to come. We have established a leading
presence in the market after five decades of successfully serving our customers, and we are now ready for new opportunities and the next
five decades of success.

 The
diverse nature of our service offerings allows us to manage our operations based on the maximization of value for our customers in
the evolving energy market. Our core revenue stream is generated from our engineering, procurement and installation services and
products consisting of solar, electrical and data installations but has expanded to include project origination, design and
development services as well. Approximately 85% of our revenue is derived from our solar Engineering, Procurement and Construction
business, approximately 10% of revenue is derived from our electrical and data business and approximately 5% of revenue is derived
from our project origination, development and design services. Recently our growth has been derived by increasing our solar customer
base, realizing the full benefit of our mergers and acquisitions and expansion into new territories. We currently
operate in Vermont, Maine, New Hampshire, New York, Massachusetts, Maryland, Alabama, Georgia and North and South Carolina. Our
union crews are expert constructors, and union access to an additional workforce makes us ready for rapid expansion to other states
while maintaining control of operating costs. The skillset provided by our workforce is transferable among our service offerings
depending on current demand.

 We
also plan to make investments in solar development projects and currently own approximately three megawatts of operating solar arrays
operating under long-term power purchase agreements. Our joint ventures allow for a retained ownership in originated projects. These
long-term recurring revenue streams, combined with our in-house development and construction capabilities, make this asset class a strategic
long-term investment opportunity for us.

 Market
Overview

 We
believe that domestic solar capacity and production will experience explosive growth over the short (through 2035) and long (2050) terms.
Both short-term and long-term solar production estimates by research groups vary, however even the most conservative estimates project
significant growth in domestic solar deployment through 2035 and again through 2050. Current domestic production is estimated at 100GW,
which services only 3% of the rapidly growing US electricity demand. According to an October 2021 US DOE Solar Futures Study i,
absent any concerted policy efforts towards decarbonization, domestic solar capacity is projected to increase by 700% by 2050. Modest
decarbonization efforts such as those incorporated in the current administration's Inflation Reduction Act would require cumulative
solar deployment to increase much more significantly from current levels - 100 GW serving ~3% of US electricity demand in 2021 to 760-1000
GW serving 37-42% by 2035, an increase of 1150%, according to Solar Power World. The International Energy Agency (IEA) projects 270 GW
of domestic solar capacity by 2026 – nearly 3x the current domestic production levels. As incentives increase and technology costs
fall, the EIA also predicts renewables could account for nearly 60 percent of capacity additions through 2050. S&P Global Market
Intelligence's projections are significantly more aggressive, projecting that domestic production will achieve 87% of the IEA's
2050 projection within the next 5 years ii.

 We
agree with the conclusions of the aforementioned reports suggesting that broader decarbonization initiatives involving the decarbonization
of the broader U.S. energy system through large-scale electrification of buildings, transportation, and industry will have an impact
on both supply (solar deployment) and demand (electricity consumed). The EIA forecasts electricity demand growth owing to electrification
of fuel-based building demands (e.g., heating), vehicles, and industrial processes of 30% from 2020 to 2035, and an additional 34% increase
in energy demand from 2035 to 2050.

 The
Inflation Reduction Act of 2022 ("IRA") legislation will invest nearly $370 billion in energy security and climate change
programs over the next decade. The IRA renews the full 30% credit rate for Investment Tax Credit ("ITC") eligible facilities
that meet the prevailing wage and apprenticeship requirements. The IRA provides a direct pay provision for tax exempt entities including
local government, tribal nations, nonprofits, cooperative and municipal utilities while also allowing for the transferability of those
tax credits. The IRA allows for additional bonus credits for qualifications related to domestic content, energy communities and low-
and moderate-income communities. The ITC will step down to 26% in 2033 and 22% in 2034.

 While
these efforts will further accelerate growth, iSun also concurs with the conclusions of these reports that domestic solar capacity and
production will grow regardless of legislative efforts supporting the aforementioned decarbonization efforts. Each report concludes that
decarbonization efforts occurring within specific geographic markets and select industries are already underway and are driving demand
for additional domestic solar capacity accordingly:

 Targeted
High-Value Geographic Markets: These markets offer:

 1.

 A
 higher internal rate of return ("IRR") on solar investments:

 2.

 Statewide
 legislation promoting decarbonization efforts that will in-turn increase electricity demand:

 3.

 High
 concentrations of consumers who are proactively taking steps towards decarbonization by electrifying their homes, appliances, small
 businesses, and automobiles; and

 4.

 Utilities
 with a favorable composition of interconnection requests and transmission and distribution capacity.

 Targeted
Rapidly Growing Industry Sectors: The anticipated widespread adoption of electric vehicles in the U.S. will dramatically change
the landscape for domestic energy consumption and production. Mercedes, Ford, and General Motors have all committed to moving to electric
or EV hybrid platforms within the decade, ensuring that by 2035, it will be difficult – if not impossible – for consumers
to purchase a new car with an internal combustion engine. The average electric vehicle requires 30 kilowatt-hours to travel 100 miles
- essentially the same amount of electricity an average American home uses each day. This will have a profound impact on electricity
demand across each segment of the marketplace. Overnight, household electricity demand could double for the average American 2-car family.
As widespread EV adoption begins to accelerate, consumers will begin looking for ways to reduce their electric bills, increasing demand
for household solar solutions. Although consumer behaviors may change with EV adoption expectations will not. Consumers will still
expect that they will be able to recharge their cars quickly and easily at the places they most often frequent. This will in turn prompt
commercial enterprises small and large to also look for ways to manage such expectations at reasonable costs. Expectations will be even
greater at destination locations such as hotels, municipal facilities, or even remote trailheads or parks, prompting asset owners and
municipalities to explore scalable solutions that may not be able to be addressed on-site. And of course, all this activity will in turn
be met with an increase in electricity demand, prompting utilities to begin exploring ways of rapidly increasing their capacity.

 Strategy

 iSun
is uniquely positioned in the marketplace to address the generational opportunity presented by automotive electrification and decarbonization.
iSun's Solar Platform serves the evolving energy needs and increased energy demands presented by automotive electrification and
decarbonization within each segment of the solar marketplace. Our:

 1.

 solar brand, SunCommon: Supports EV purchases with at-home charging, promotes residential solar + storage installation, and provides
 other smart home energy upgrades.

 2.

 & Industrial Division: Supports EV fleet and workplace charging adoption, promotes solar projects at the workplace to help
 employers and businesses provide for their customers and employees, and stabilize their energy costs. Enables municipalities, destination
 locations, and communities and/or dwellings where on-site or roof-top installation may not be a viable option to adopt EV charging
 and solar solutions via resilient microgrid and community solar projects.

 3.

 and Development Division: Helps utilities meet increased demand and upgrade their infrastructure to with utility-scale solar
 projects and utilize current design and development services to originate solar projects for all divisions.

 i
 US Residential PV Customer Acquisition Costs and Trends, Woods Mackenzie Power & Renewables, October 2021 (Connelly, White).

 ii
 Solar Power World Reference.

 Some
of the customer needs that will result from automotive electrification and decarbonization are agnostic to scale and will be universal
across all segments. A customer-centric organization, iSun has created cross-division service teams to proactively address these needs.
iSun's:

 1.

 EV
 Charging Services provides proprietary, solar-powered charging hardware and software solutions that enable grid-tied or off-grid
 EV charging.

 2.

 Development
 and Professional Services provide solar developers with an a la carte menu of services they can use to help accelerate the development
 process, and more quickly bring their projects on-line, all without having to scale their operation.

 3.

 Solar
 Installation, Operations and Management Services incorporates iSun's expertise as one of the largest solar contractors
 into a comprehensive suite of services solar asset owners can use to keep their arrays operating at peak performance levels.

 Because
we provide services to each segment of the marketplace, our Solar Platform enables us to adapt to the evolving range of customer demand
and energy innovations resulting from decarbonization and vehicle electrification.

 Customer
Acquisition: iSun's growth and new customer acquisition strategies are unique to each division.

 Residential:
 SunCommon values high-touch customer service capabilities that foster long-term customer relationships. Our focus ideally suits
the contemporary market environment, where recent technologies like EV charging, energy storage and grid management are arriving early
and often. The rapid pace of these deployments mean consumers will be looking to enhance their systems more regularly, increasing long-term
customer value. We can cultivate and maintain these relationships at an exceptionally low cost. SunCommon reported new customer acquisition
costs of $0.13/sales for the 12 months ended December 31, 2023.

and Industrial: We continue to experience organic growth from our established relationships with national developers requesting
development and EPC services. Additionally, we have made strategic investments in entities capable of providing a robust pipeline of
industrial-scale EPC projects. Additionally, the transaction has provided insights into new prospective geographic markets, which has
informed iSun's geographic growth strategy for its Residential and Commercial divisions.

 Utility:
 With the acquisition of Oakwood Construction Services intellectual property, we were able to expand our utility-scale capabilities
to include EPC as well as our development and professional services. Unlike EPC services, development and professional services occur
prior to the commencement of construction and are not contingent upon a project proceeding to construction status. Development and professional
services not only enhance cash-flows and margins on a month-to-month basis, but also afford us the rights to construction services for
each project that proceeds to construction, effectively transforming the lead generation funnel for iSun. Immediate success of this strategy
is demonstrated by contracts for development and professional services work on 1.3G of solar projects across 4 project sites across the
US.

 Ancillary
Markets

 Our
capabilities allow for expansion into high-growth adjacent markets. We began operations as a traditional electric contractor and hold
a wide range of capabilities to install electric equipment for a variety of end uses. Today, these core capabilities have developed our
business in solar array installation, traditional electric, and data services. We can deploy these capabilities to other large, rapidly
growing clean/renewable end market within each segment; namely electric vehicle ("EV") charging stations, data centers, energy
storage and other markets. The rapid proliferation of EV charging stations has followed the shift in auto sales to electronic vehicles,
and the EV charging market is expected to expand to over $30 billion by 2024 with a CAGR of 40% over the next 2-year period. Energy
storage measured by megawatts expanded by 44% year-over-year in 2018 and is projected to grow into a $4.7 billion market by 2024.
Both markets represent adjacent, high growth expansion opportunities for us, and both require minimal investment of resources, infrastructure
or capital spend given its complementary nature to our existing capabilities.

 Employees

 As
of April 16, 2024, we employed approximately 275 full-time employees. We may also utilize outside subcontractors to assist with installing
solar systems for our commercial and residential customers. Our direct installation labor is a combination of employees and contract
labor.

 We
have direct access to unionized labor, which provides a unique advantage for growth, because workforce resources can be scaled efficiently
utilizing local labor unions in other states to meet specific project needs in other states without increasing fixed labor costs for
us.

 Financing

 To
promote residential sales, we assist customers in obtaining financing options. Our objective is to arrange the most flexible terms that
meet the needs and wants of the customer. Although we do not yet directly provide financing, we have relationships to arrange financing
with numerous private and public sources, including Mosaic, and the Vermont State Employees Credit Union, which offers VGreen financing
to maximize solar investment savings.

 We
believe it is best for customers to own their own systems, but some customers prefer not to own their systems. We also have the ability
to arrange financing with third parties through power purchase agreements and leases for our customers.

 Suppliers

 We
purchase solar panels, inverters and materials directly from multiple manufacturers and through distributors. We intend to further coordinate
purchases across all business segments and to optimize supply relationships to realize the advantages of greater scale.

 If
one or more of our suppliers fail to meet our supply needs, ceases or reduces production due to its financial condition, acquisition
by a competitor or otherwise, it may be difficult to quickly identify alternate suppliers or to qualify alternative products on commercially
reasonable terms, and our ability to satisfy this demand may be adversely affected. We do not, however, rely on any single supplier and
our management believes that we can obtain needed solar panels and materials from a number of different suppliers. Accordingly, we believe
that the loss of any single supplier would not materially affect our business.

 We
also utilize companies with subcontractors for electrical installations, for racking and solar panel installations, as well as numerous
subcontractors for grading, landscaping, and construction for our commercial, and industrial customers.

 Installation

 We
are a licensed contractor in the markets that we serve, and we are responsible for every customer installation. We manage the entire
process from permitting through inspection to interconnection to the power grid, thereby making the system installation process simple
and seamless for its customers. Controlling every aspect of the installation process allows us to minimize costs, ensure quality and
deliver high levels of customer satisfaction.

 Even
with controlling every aspect of the installation process, the ability to perform on a contract is subject to limitations. There remain
jurisdictional approval processes outside our immediate control including, but not limited to, approvals of city, county, state or Federal
government bodies or one of their respective agencies. Other aspects outside of our direct control include approvals from various utility
companies and weather conditions.

 After-Sales
Support

 It
is our intent to provide continuing operation and maintenance services for our installed residential and commercial solar systems. We
provide extended factory equipment technical support and act as a service liaison using our proprietary knowledge, technology, and solar
electric energy engineering staff. We do this through a 5-year limited workmanship warranty and operations and maintenance program, which
among other things, provides a service and technical support line to our customers. We generally respond to our job site related issues
within 24 hours and offer assistance as long as required to maintain customer satisfaction. Our price to customers includes this warranty,
and also includes the pass through of various manufacturers' warranties that are typically up to 25 years.

 Customers

 Historically,
the majority of our revenue came from commercial and industrial solar installations ranging in size from 100 kilowatts to 10 megawatts.
In 2023, we continued to expand our capabilities to serve customers across the residential, commercial, industrial and utility markets.
We expanded our services based on customer demand to include development and professional services, engineering, procurement, installation,
storage, monitoring and electric vehicle infrastructure support.

 In
2023, approximately 35% of revenues were generated by residential installations, approximately 50% of revenues were generated by commercial
and industrial installations, 11% of revenues were generated from electrical and data contracts, and 4% of revenues were generated by
project origination services. In 2022, approximately 52% of our revenues were generated by residential installations, approximately 33%
of revenues were generated by commercial and industrial installations, 10% of revenue were generated from our electrical and data contracts,
and 5% of revenues were generated by project origination services.

 We
believe that we have an advantage in the commercial solar market in New England given our extensive contact list, resulting from our
experience in the commercial and industrial construction market, which also provides access to customers that trust us. Through our network
of vendors, participation in variety of industry trade associations and independent sales consultants, we now have a growing list of
repeat clients, as well as an active and loyal referral network. As new markets open in other key geographic regions, we are able to
leverage our reputation and long-term customer relationships for market entry.

 Competitors

 In
the solar installation market, we compete with companies that offer products similar to our products. Some of these companies have greater
financial resources, operational experience, and technical capabilities than we do. When bidding for solar installation projects, however,
our current experience suggests that we are the dominant or preferred competitor in the markets in which we compete. We do not believe
that any competitor has more than 10% of the market across all the areas in which we currently operate. We compete with other solar installers
on our expertise and proven track record of performance. Also, pricing, service and the ability to arrange financing may be important
for a project award.

 Seasonality

 We
often find that some customers tend to book projects by the end of a calendar year to realize the benefits of available subsidy programs
prior to year-end. This results in third and fourth quarter sales being more robust usually at the expense of the first quarter. In the
future, this seasonality may cause fluctuations in financial results. In addition, other seasonality trends may develop and the existing
seasonality that we experience may change. Weather can also be an important factor affecting project timelines.

 Technology
and Intellectual Property

 Generally,
the solar EPC business is not dependent on intellectual property. We did acquire the intellectual property of Oakwood Construction Services,
LLC which provides proprietary capabilities for solar asset development and execution of large utility scale solar projects at a significant
value to our customers.

 Government
Regulation and Incentives

 Government
Regulation

 We
are not regulated as a public utility in the United States under applicable national, state or other local regulatory regimes where we
conduct business.

 To
operate our systems, we obtain interconnection permission from the applicable local primary electric utility. Depending on the size of
the solar energy system and local law requirements, interconnection permission is provided by the local utility and we and/or our customer.
In almost all cases, interconnection permissions are issued on the basis of a standard process that has been pre-approved by the local
public utility commission or other regulatory body with jurisdiction overnet metering procedures. As such, no additional regulatory approvals
are required once interconnection permission is given.

 Our
operations are subject to stringent and complex federal, state and local laws, including regulations governing the occupational health
and safety of our employees and wage regulations. For example, we are subject to the requirements of OSHA, the DOT and comparable state
laws that protect and regulate employee health and safety.

 Government
Incentives

 Federal,
state and local government bodies provide incentives to owners, end users, distributors, system integrators and manufacturers of solar
energy systems to promote solar energy in the form of rebates, tax credits and other financial incentives such as system performance
payments, payments for renewable energy credits associated with renewable energy generation and exclusion of solar energy systems from
property tax assessments. These incentives enable iSun to lower the price it charges customers to own or lease, our solar energy systems,
helping to catalyze customer acceptance of solar energy as an alternative to utility-provided power.

 The
Inflation Reduction Act of 2022 ("IRA") legislation will invest nearly $370 billion in energy security and climate change
programs over the next decade. The Act renews the full 30% credit rate for Investment Tax Credit ("ITC") of eligible facilities
that meet the prevailing wage and apprenticeship requirements. The IRA provides a direct pay provision for tax exempt entities including
local governments, tribal nations, nonprofits, cooperative and municipal utilities while also allowing for the transferability of those
tax credits. The IRA allows for additional bonus credits for qualifications related to domestic content, energy communities and low-
and moderate-income communities. The ITC will step down to 26% in 2033 and 22% in 2034.

 The
economics of purchasing a solar energy system are also improved by eligibility for accelerated depreciation, also known as the modified
accelerated cost recovery system, or MACRS depreciation, which allows for the depreciation of equipment according to an accelerated schedule
set forth by the Internal Revenue Service. The acceleration of depreciation creates a valuable tax benefit that reduces the overall cost
of the solar energy system and increases the return on investment.

 Approximately
50% of states in the U.S. offer a personal and/or corporate investment or production tax credit for solar energy that is additive to
the ITC. Further, these states, and many local jurisdictions, have established property tax incentives for renewable energy systems that
include exemptions, exclusions, abatements, and credits. Many state governments, traditional utilities, municipal utilities and co-operative
utilities offer a rebate or other cash incentive for the installation and operation of a solar energy system or energy efficiency measures.
Capital costs or "up-front" rebates provide funds to solar customers based on the cost, size or expected production of a
customer's solar energy system. Performance-based incentives provide cash payments to a solar energy system owner based on the
energy generated by their solar energy system during a pre-determined period, and they are paid over that time period. Depending on the
cost of the system and other site-specific variables, tax incentives can typically cover 30-40% of the cost of a commercial or residential
solar system.

 Many
states also have adopted procurement requirements for renewable energy production that requires regulated utilities to procure a specified
percentage of total electricity delivered to customers in the State from eligible renewable energy sources, such as solar energy systems,
by a specified date.

 Environmental,
Social and Corporate Governance

 Governance
and Strategic Overview

 In
2023, iSun built upon its historic foundation of environmentally and socially responsible business by formalizing an enterprise-level
ESG strategy. This strategy is overseen by an ESG Executive Committee and guided by the Corporate Governance Committee on the Board of
Directors. Our governance efforts have included developing and publishing a core set of policies that speak to our position on and approach
to a range of environmental, social, and governance issues. Through a stakeholder engagement process and iSun employee interviews, we
have identified a set of material issues that are critical to both our business and to our key stakeholders. As such, we have developed
policies and are implementing initiatives related to climate change and environmental stewardship, diversity, equity and inclusion (DEI),
labor management and human rights, and stakeholder engagement. We are also formalizing and implementing a Business Code of Conduct as
well as a Supplier Code of Conduct.

 Our
strategic plan is designed to mitigate the risks and capitalize on the opportunities associated with these issues, with an explicit focus
on aligning our commercial goals and impact aspirations to drive both shareholder and broader stakeholder value. This strategy will be
guided by cross-functional working groups comprised of leaders from across the company and will have explicit goals, key performance
indicators (KPIs), and timelines for implementing the initiatives that address each issue.

 iSun
will be focused on integrating, aligning, and scaling the impact programs developed over the years by SunCommon, our recently purchased
subsidiary, which is a Vermont benefit corporation and a certified B corporation and a recognized leader in the world of socially responsible
business.

 iSun
is currently in compliance with all ESG-related requirements of the SEC and of Nasdaq including the Board Diversity Disclosure Matrix
provided below.

 iSun,
Inc. Board Diversity Matrix

 Total
Number of Directors: 5

 Female

 Male

 Non-Binary

 Did Not
 Disclose
 Gender

 Part 1: Gender Identity

 Directors

 Part 2: Demographic Background

 African American or Black

 Alaskan Native or Native American

 Asian

 Hispanic or Latin

 Native Hawaiian or Pacific Islander

 White

 Two or more Races/Ethnicities

 LGBTQ+

 Did Not Disclose Demographic Background

 Risks
and Opportunities

 Climate
change, and its associated issues like emissions, energy management, waste, and water management – have been identified as critical
to our social mission and the concerns of our commercial customers, employees, and investors. Our mission to accelerate the world's
transition from dirty to clean energy can only be achieved if we are also decarbonizing our own operations and supply chains. We will
be setting long-term goals on climate change and these associated environmental issues after we conduct our first enterprise Greenhouse
Gas (GHG) accounting exercise to determine our scopes 1, 2, and 3 emissions.

 Human
capital, and diversity, equity, and inclusion (DEI), have been identified as critical to our long-term success and social impact aspirations.
Human capital has become an increasingly important topic for investors and society at large. It is also integral to the long-term success
of our business as we rely heavily on our installation teams and the union members we employ. In turn, we will be ramping up our focus
on workforce development and upward mobility opportunities for our employees, advancing work opportunities for diverse and at-risk populations,
as well as supporting economic inclusion within our supply chains through a minority-owned business procurement program.

 Governance
and corporate transparency, both internally and externally, is another core risk and opportunity to address. Our revamped ESG governance
structure and utilization of the ESG project management platform, ESGProgram.io, will ensure alignment and integration of these efforts
across the iSun enterprise. An internal and external ESG communications plan will also ensure our intentions, efforts, and outcomes are
well understood by our external stakeholders and greater operational alignment with our internal teams. Lastly, we will be providing
ESG education to our executive leaders and Board to ensure they can actively contribute to the success of our ESG strategy.

 Climate
Change and Human Capital Management

 Climate
change and human capital management are two leading ESG issues across industries. From investor expectations to SEC disclosure regulations,
climate risk management and human capital management have emerged as the two most critical issues from a stakeholder and general public
perspective.

 Our
objectives for climate change include measuring and reducing our emissions, waste, and water, enhancing our operational climate risk
resilience, and developing service offerings that support the climate risk resilience of our customers. We will be setting long-term
climate change goals, KPI's, and timelines for achievement, as well as reporting our progress in a 2024 Task Force for Climate-Related
Financial Disclosures (TCFD) report.

 Our
objectives for human capital management include increasing the diversity of our workforce and procurement partners, creating upward mobility
opportunities for diverse employees and field staff, as well as increasing the visibility and importance of the trades in the communities
we live and work. We will be setting long-term human capital goals, KPI's, and timelines for achievement, as well as reporting
our progress in 2023 with the relevant metrics from the Sustainable Accounting Standards Boards (SASB).

 Commitments

 We
will be implementing our enterprise ESG strategic plan across our operations. As our cross-functional working groups get up and running,
we will begin our enterprise GHG emissions assessment and develop the internal infrastructure for consistent ESG data collection. All
material issues will be overseen by their relevant functional leaders and will have explicit and quantified goals, KPI's, and timelines
for achievement. We will be reporting on our progress throughout the year, culminating in a ESG report and complete with a Sustainable
Accounting Standards Boards (SASB) and Task Force for Climate-related Financial Disclosures (TCFD) reports. Our progress will be actively
communicated externally on our website and in governance documents to ensure full visibility into our ESG intentions, efforts, and results.

Information

 Our
address is 400 Avenue D, Suite 10, Williston, VT 05495 and our telephone number is (802) 658-3378. Our corporate website is: www.isunenergy.com.
The content of our website shall not be deemed incorporated by reference in this Annual Report.

 Item
 1A.

 Risk
 Factors.

 An
investment in our Common Stock involves significant risks. You should carefully consider the risk factors contained in this Annual Report
and in our filings with the SEC before you decide to invest in our Common Stock. Our business, prospects, financial condition and results
of operations may be materially and adversely affected as a result of any of such risks. The value of our Common Stock could decline
as a result of any of these risks. You could lose all or part of your investment in our Common Stock. Some of our statements in sections
entitled "Risk Factors" are forward-looking statements. The risks and uncertainties we have described are not the only ones
we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business,
prospects, financial condition and results of operations.

 The
impact of a subsequent wave of the coronavirus pandemic (COVID-19) on general market and economic conditions has yet to be determined
and if it occurs it is likely to have a material adverse effect on our business and results of operations.

 As
of the date of this Annual Report on Form 10-K, the coronavirus pandemic (COVID-19) had resulted in widespread disruption to capital
markets and general economic and business climate. The extent to which COVID-19 affects our future results, or those of our suppliers,
will depend on future developments, which are highly uncertain and cannot be predicted. At this time, no material impact to our business
and operations is anticipated.

 The
Russian-Ukraine conflict and the impact of related sanctions may impact our business.

 As
of the date of this Annual Report on Form 10-K, the Russia-Ukraine conflict and related sanctions have not had any impact on our business.
However, we may be impacted by the disruptions of the global supply chain.

 The
Mideast conflict and related shipping disruptions may impact our business.

 As
of the date of this Annual Report on Form 10-K, the Mideast conflict and related shipping disruptions have not had any impact on our
business. However, we may be impacted by the disruptions of the global supply chain.

 Risks
Related to Our Financial Position and Capital Requirements

 We might not be able
to continue as a going concern, which would likely cause our stockholders to lose most or all of their investment

 Our
audited financial statements for the year ended December 31, 2023 were prepared under the assumption that we would continue as a going
concern. However, we have concluded that there is substantial doubt about our ability to continue as a going concern, therefore our independent
registered public accounting firm included a "going concern" explanatory paragraph in its report on our financial statements
for the year ended December 31, 2023, indicating that, without additional sources of funding, our cash at December 31, 2023 is not sufficient
for us to operate as a going concern for a period of at least one year from the date that the financial statements included in this Annual
Report on Form 10-K are issued. Management's plans concerning these matters, including our need to raise additional capital, are
described in Note 3 – Liquidity and Going Concern of our financial statements included within this Annual Report on Form 10-K,
however, management cannot assure you that its plans will be successful. If we cannot continue as a viable entity, our stockholders would
likely lose most or all of their investment in us.

 We
operated at a loss in 2023 and 2022 and cannot predict when we will achieve profitability.

 Our
management believes that achieving profitability will depend in large part on our ability to increase market share in our existing
market segments and expand our geographic foot print and to consummate synergistic acquisitions. No assurance can be given that we
will achieve profitably or that we will have adequate working capital to meet our obligations as they become due. We have generated
losses since we began operations, including net losses of approximately $19.4 million and $53.8 million for the years ended December
31, 2023 and 2022. The Company has also taken steps to reduce overhead through the consolidation of certain shared services,
Finance, IT, HR and administrative functions. Our residential division has customer orders of approximately $13.4 million expected
to be completed within four to six months, our commercial division has a contracted backlog of approximately $26.8 million expected
to be completed within six to eight months and our industrial division has a contracted backlog of approximately $120.0 million
expected to be completed within twelve to eighteen months. The Company is projecting revenue to stabilize at approximately $100M which
will provide sufficient cash flow from operations.

 We
may require substantial additional funding which may not be available to it on acceptable terms, or at all. If we fail to raise the necessary
additional capital, we may be unable to maintain our business and operations.

 The
Company was not profitable in 2023 and 2022. The Company intends to decrease our spending for our operating expenses.

 We
cannot be certain that additional funding will be available on acceptable terms, or at all. If we are unable to raise additional capital
in sufficient amounts or on terms acceptable to us, we may have to significantly delay, scale back or discontinue our organic growth
or corporate acquisitions. Any of these events could significantly harm our business, financial condition, and strategy.

 In
order to carry out our business plan and implement our strategy, we anticipate that we will need to obtain additional financing from
time to time, and we may choose to raise additional funds through strategic collaborations, public or private equity or debt financing,
bank lines of credit, asset sales, government grants, or other arrangements. Our management cannot be sure that any additional funding,
if needed, will be available on favorable terms or at all. Furthermore, any additional equity or equity-related financing obtained may
be dilutive to our stockholders, and debt or equity financing, if available, may subject us to restrictive covenants and significant
interest costs.

 An
inability to raise capital when needed could harm our business, financial condition and results of operations, and could cause our stock
price to decline or require that we cease operations.

 Our
management discovered material weaknesses in our disclosure controls and procedures and internal control over financial reporting as
required to be implemented by Section 404 of the Sarbanes-Oxley Act of 2002.

 We
are currently subject to Section 404 of the Sarbanes-Oxley Act of 2002 and are required to provide management's attestation on
internal controls. Our management has identified control deficiencies and the need for a stronger internal control environment relating
to the financial statement close process. The ineffectiveness of the design, implementation and operation of the controls surrounding
these matters creates a reasonable possibility that a material misstatement to the consolidated financial statements would not be prevented
or detected on a timely basis. Accordingly, our management concluded that this deficiency represents a material weakness in our internal
control over financial reporting as of December 31, 2023. Although our management has taken significant steps to remediate this weakness,
our management can give no assurance that all the measures it has taken will on a permanent and sustainable basis remediate the material
weaknesses in our disclosure controls and procedures and internal control over financial reporting or that any other material weaknesses
or restatements of financial results will not arise in the future. We plan to take additional steps to remedy this material weakness.
If we are not able to implement the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 in the future, we will not be able
to assess whether our internal controls over financial reporting are effective, which may subject us to adverse regulatory consequences
and could harm investor confidence and the market price of our Common Stock.

 Risks
Related to Our Business and Industry

 A
material reduction in the retail price of traditional utility generated electricity or electricity from other sources could harm our
business, financial condition, results of operations and prospects.

 Our
management believes that a significant number of our customers decide to buy solar energy because they want to pay less for electricity
than what is offered by the traditional utilities.

 The
customer's decision to choose solar energy may also be affected by the cost of other renewable energy sources. Decreases in the
retail prices of electricity from the traditional utilities or from other renewable energy sources would harm our ability to offer competitive
pricing and could harm our business. The price of electricity from traditional utilities could decrease as a result of:

 construction
 of a significant number of new power generation plants, including plants utilizing natural gas, nuclear, coal, renewable energy or
 other generation technologies;

 relief
 of transmission constraints that enable local centers to generate energy less expensively;

 reductions
 in the price of natural gas;

 utility
 rate adjustment and customer class cost reallocation;

 energy
 conservation technologies and public initiatives to reduce electricity consumption;

 development
 of new or lower-cost energy storage technologies that have the ability to reduce a customer's average cost of electricity by
 shifting load to off-peak times; or

 development
 of new energy generation technologies that provide less expensive energy.

 A
reduction in utility electricity prices would make the purchase or the lease of our solar energy systems less economically attractive.
If the retail price of energy available from traditional utilities were to decrease due to any of these reasons, or other reasons, we
would be at a competitive disadvantage, may be unable to attract new customers and our growth would be limited.

 Existing
electric utility industry regulations, and changes to regulations, may present technical, regulatory and economic barriers to the purchase
and use of solar energy systems that may significantly reduce demand for our solar energy systems.

 Federal,
state and local government regulations and policies concerning the electric utility industry, and internal policies and regulations promulgated
by electric utilities, heavily influence the market for electricity generation products and services. These regulations and policies
often relate to electricity pricing and the interconnection of customer-owned electricity generation. In the United States, governments
and utilities continuously modify these regulations and policies. These regulations and policies could deter customers from purchasing
renewable energy, including solar energy systems. This could result in a significant reduction in the potential demand for our solar
energy systems. For example, utilities commonly charge fees to larger, industrial customers for disconnecting from the electric grid
or for having the capacity to use power from the electric grid for back-up purposes. These fees could increase our customers' cost
to use our systems and make them less desirable, thereby harming our business, prospects, financial condition and results of operations.
In addition, depending on the region, electricity generated by solar energy systems competes most effectively with expensive peak-hour
electricity from the electric grid, rather than the less expensive average price of electricity. Modifications to the utilities'
peak hour pricing policies or rate design, such as to a flat rate, would require us to lower the price of our solar energy systems to
compete with the price of electricity from the electric grid.

 In
addition, any changes to government or internal utility regulations and policies that favor electric utilities could reduce our competitiveness
and cause a significant reduction in demand for our products and services. For example, certain jurisdictions have proposed assessing
fees on customers purchasing energy from solar energy systems or imposing a new charge that would disproportionately impact solar energy
system customers who utilize net metering, either of which would increase the cost of energy to those customers and could reduce demand
for our solar energy systems. It is possible charges could be imposed on not just future customers but our existing customers, causing
a potentially significant consumer relations problem and harming our reputation and business. Due to the current concentration of our
business in Vermont, any such changes in these markets would be particularly harmful to our business, results of operations, and future
growth.

 Our
growth strategy depends on the widespread adoption of solar power technology.

 The
market for solar power products is emerging and rapidly evolving, and our future success is uncertain. If solar power technology proves
unsuitable for widespread commercial deployment or if demand for solar power products fails to develop sufficiently, we would be unable
to generate enough revenues to achieve and sustain profitability and positive cash flow. The factors influencing the widespread adoption
of solar power technology include but are not limited to:

 cost-effectiveness
 of solar power technologies as compared with conventional and non-solar alternative energy technologies;

 performance
 and reliability of solar power products as compared with conventional and non-solar alternative energy products;

 fluctuations
 in economic and market conditions which impact the viability of conventional and non-solar alternative energy sources, such as increases
 or decreases in the prices of oil and other fossil fuels;

 continued
 deregulation of the electric power industry and broader energy industry; and

 availability
 of governmental subsidies and incentives.

 Our
business currently depends on the availability of rebates, tax credits and other financial incentives. The expiration, elimination or
reduction of these rebates, credits and incentives would adversely impact our business.

 U.S.
federal, state and local government bodies provide incentives to end users, distributors, system integrators and manufacturers of solar
energy systems to promote solar electricity in the form of rebates, tax credits and other financial incentives such as system performance
payments and payments for renewable energy credits associated with renewable energy generation. These governmental rebates, tax credits
and other financial incentives enhance the return on investment for our customers and incent them to purchase solar systems. These incentives
enables us to lower the price that we charge customers for energy and for solar energy systems. However, these incentives may expire
on a particular date, end when the allocated funding is exhausted, or be reduced or terminated as solar energy adoption rates increase.
These reductions or terminations often occur without warning.

 Reductions
in, or eliminations or expirations of, governmental incentives could adversely impact our results of operations and our ability to compete
in our industry, causing us to increase the prices of our solar energy systems, and reducing the size of our addressable market. In addition,
this would adversely impact our ability to attract investment partners and to form new financing funds and our ability to offer attractive
financing to prospective customers.

 Our
business depends in part on the regulatory treatment of third-party owned solar energy systems.

 Our
leases and any power purchase agreements are third-party ownership arrangements. Sales of electricity by third parties face regulatory
challenges in some states and jurisdictions. Other challenges pertain to whether third-party owned systems qualify for the same levels
of rebates or other non-tax incentives available for customer-owned solar energy systems, whether third-party owned systems are eligible
at all for these incentives, and whether third-party owned systems are eligible for net metering and the associated significant cost
savings. Reductions in, or eliminations of, this treatment of these third-party arrangements could reduce demand for our systems, adversely
impact our access to capital and could cause us to increase the price that we charge our customers for energy.

 Our
ability to provide solar energy systems to customers on an economically viable basis depends on our ability to help customers arrange
financing for such systems.

 Our
solar energy systems have been eligible for federal investment tax credits or U.S. Treasury grants, as well as depreciation benefits.
We have relied on, and will continue to rely on, financing structures that monetize a substantial portion of those benefits and provide
financing for our solar energy systems. With the lapse of the U.S. Treasury grant program, we anticipate that our customers' reliance
on these tax-advantaged financing structures will increase substantially. If, for any reason, our customers were unable to continue to
monetize those benefits through these arrangements, we may be unable to provide and maintain solar energy systems for new customers on
an economically viable basis.

 The
availability of this tax-advantaged financing depends upon many factors, including, but not limited to:

 the
 state of financial and credit markets;

 changes
 in the legal or tax risks associated with these financings; and

 non-renewal
 of these incentives or decreases in the associated benefits.

 U.S.
Treasury grants are no longer available for new solar energy systems. Changes in existing law and interpretations by the Internal Revenue
Service and the courts could reduce the willingness of funding sources to provide funds to customers of these solar energy systems. We
cannot assure you that this type of financing will be available to our customers. If, for any reason, we are unable to find financing
for solar energy systems, we may no longer be able to provide solar energy systems to new customers on an economically viable basis.
This would have a material adverse effect on our business, financial condition, and results of operations.

 Rising
interest rates could adversely impact our business.

 Increases
in interest rates could have an adverse impact on our business by increasing our cost of capital, which would increase our interest expense
on any variable rate indebtedness and make acquisitions more expensive to undertake.

 Further,
rising interest rates may negatively impact our ability to arrange financing for our customers on favorable terms to facilitate our customers'
purchases of our solar energy systems. The majority of our cash flows to date have been from the sales of solar energy systems. Rising
interest rates may have the effect of depressing the sales of solar energy systems because many consumers finance their purchases.

 As
a result, an increase in interest rates may negatively affect our costs and reduce our revenues, which would have an adverse effect on
our business, financial condition, and results of operations.

 If
we cannot compete successfully against other solar and energy companies, we may not be successful in developing our operations and our
business may suffer.

 The
solar and energy industries are characterized by intense competition and rapid technological advances, both in the United States and
internationally. We compete with solar companies with business models that are similar to ours. In addition, we compete with solar companies
in the downstream value chain of solar energy. For example, we face competition from purely finance driven organizations that acquire
customers and then subcontract out the installation of solar energy systems, from installation businesses that seek financing from external
parties, from large construction companies and utilities, and increasingly from sophisticated electrical and roofing companies. Some
of these competitors specialize in the residential solar energy market, and some may provide energy at lower costs than we do. Further,
some competitors are integrating vertically in order to ensure supply and to control costs. Many of our competitors also have significant
brand name recognition and have extensive knowledge of our target markets.

 If
we are unable to compete in the market, we will experience an adverse effect on our business, financial condition, and results of operations.

 Adverse
economic conditions may have material adverse consequences on our business, results of operations and financial condition.

 Unpredictable
and unstable changes in economic conditions, including recession, inflation, increased government intervention, or other changes, may
adversely affect our general business strategy. We rely upon our ability to generate additional sources of liquidity and we may need
to raise additional funds through public or private debt or equity financings in order to fund existing operations or to take advantage
of opportunities, including acquisitions of complementary businesses or technologies. Any adverse event would have a material adverse
impact on our business, results of operations and financial condition.

 Our
business is concentrated in certain markets, putting it at risk of region-specific disruptions.

 As
of December 31, 2023, a vast majority of our total solar installations were in the Northeast. Our management expects our near-term future
growth to occur throughout the Eastern United States, and to further expand our customer base and operational infrastructure. Accordingly,
our business and results of operations are particularly susceptible to adverse economic, regulatory, political, weather and other conditions
in such markets and in other markets that may become similarly concentrated.

 If
we are unable to retain and recruit qualified technicians and advisors, or if our key executives, key employees or consultants discontinue
their employment or consulting relationship with us, we may delay our development efforts or otherwise harm our business.

 We
may not be able to attract or retain qualified management or technical personnel in the future due to the intense competition for qualified
personnel among solar, energy, and other businesses. Our industry has experienced a high rate of turnover of management personnel in
recent years. If we are not able to attract, retain, and motivate necessary personnel to accomplish our business objectives, we may experience
constraints that will significantly impede the successful development of any product candidates, our ability to raise additional capital,
and our ability to implement our overall business strategy.

 We
are highly dependent on members of our management and technical staff. Our success also depends on our ability to continue to attract,
retain and motivate highly skilled junior, mid-level, and senior managers as well as junior, mid-level, and senior technical personnel.
The loss of any of our executive officers, key employees, or consultants and our inability to find suitable replacements could potentially
harm our business, financial condition, and prospects. We may be unable to attract and retain personnel on acceptable terms given the
competition among solar and energy companies. Certain of our current officers, directors, and/or consultants hereafter appointed may
from time to time serve as officers, directors, scientific advisors, and/or consultants of other solar and energy companies. We do not
maintain "key man" insurance policies on any of our officers or employees. Other than certain members of our senior management
team, all of our employees are employed "at will" and, therefore, each employee may leave our employment and join a competitor
at any time.

 We
plan to grant stock options, restricted stock grants, or other forms of equity awards in the future as a method of attracting and retaining
employees, motivating performance, and aligning the interests of employees with those of our stockholders. If we are unable to implement
and maintain equity compensation arrangements that provide sufficient incentives, we may be unable to retain our existing employees and
attract additional qualified candidates. If we are unable to retain our existing employees and attract additional qualified candidates,
our business and results of operations could be adversely affected.

 The
execution of our business plan and development strategy may be seriously harmed if integration of our senior management team is not successful.

 As
our business continues to grow and in the event that we acquire new businesses, we may experience significant changes in our senior management
team. Failure to integrate our Board of Directors and senior management teams may negatively affect the operations of our business.

 We
may not successfully implement our business model.

 Our
business model is predicated on our ability to build and sell solar systems at a profit, and through organic growth, geographic expansion
and strategic acquisitions. Our management intends to continue to operate our business as it has previously, with sourcing and marketing
methods that we have used successfully in the past. However, our management cannot assure you that our methods will continue to attract
new customers nor that we can achieve profitability in the very competitive solar systems marketplace.

 We
may not be able to effectively manage our growth.

 Our
future growth, if any, may cause a significant strain on our management and our operational, financial, and other resources. Our ability
to manage our growth effectively will require us to implement and improve our operational, financial, and management systems and to expand,
train, manage, and motivate our employees. These demands may require the hiring of additional management personnel and the development
of additional expertise by our management. Any increase in resources used without a corresponding increase in our operational, financial,
and management systems could have a material adverse effect on our business, financial condition, and results of operations.

 We
may not realize the anticipated benefits of completed and future acquisitions, and integration of these acquisitions may disrupt our
business and management.

 We
have acquired and, in the future, we may acquire companies, project pipelines, products or technologies or enter into joint ventures
or other strategic initiatives. We may not realize the anticipated benefits of these acquisition and any acquisition has numerous risks.
These risks include the following:

 difficulty
 in assimilating the operations and personnel of the acquired company;

 difficulty
 in effectively integrating the acquired technologies or products with our current technologies;

 difficulty
 in maintaining controls, procedures and policies during the transition and integration;

 disruption
 of our ongoing business and distraction of management and employees from other opportunities and challenges due to integration issues;

 difficulty
 integrating the acquired company's accounting, management information, and other administrative systems;

 inability
 to retain key technical and managerial personnel of the acquired business;

 inability
 to retain key customers, vendors, and other business partners of the acquired business;

 inability
 to achieve the financial and strategic goals for the acquired and combined businesses;

 incurring
 acquisition-related costs or amortization costs for acquired intangible assets that could impact operating results;

 potential
 failure of the due diligence processes to identify significant issues with product quality, legal and financial liabilities, among
 other things;

 potential
 inability to assert that internal controls over financial reporting are effective; and

 potential
 inability to obtain, or obtain in a timely manner, approvals from governmental authorities, which could delay or prevent such acquisitions.

 Mergers
and acquisitions of companies are inherently risky and, if we do not complete the integration of acquired businesses successfully and
in a timely manner, we may not realize the anticipated benefits of the acquisitions to the extent anticipated, which could adversely
affect our business, financial condition, or results of operations.

 With
respect to providing electricity on a price-competitive basis, solar systems face competition from traditional regulated electric utilities,
from less-regulated third party energy service providers and from new renewable energy companies.

 The
solar energy and renewable energy industries are both highly competitive and continually evolving as participants strive to distinguish
themselves within their markets and compete with large traditional utilities. We believe that our primary competitors are the traditional
utilities that supply electricity to our potential customers. Traditional utilities generally have substantially greater financial, technical,
operational and other resources than we do. As a result, these competitors may be able to devote more resources to the research, development,
promotion, and sale of their products or respond more quickly to evolving industry standards and changes in market conditions than we
can. Traditional utilities could also offer other value-added products or services that could help them to compete with us even if the
cost of electricity they offer is higher than that of ours. In addition, a majority of utilities' sources of electricity is non-solar,
which may allow utilities to sell electricity more cheaply than electricity generated by our solar energy systems.

 We
also compete with companies that are not regulated like traditional utilities, but that have access to the traditional utility electricity
transmission and distribution infrastructure pursuant to state and local pro-competitive and consumer choice policies. These energy service
companies are able to offer customers electricity supply-only solutions that are competitive with our solar energy system options on
both price and usage of renewable energy technology while avoiding the long-term agreements and physical installations that our current
fund-financed business model requires. This may limit our ability to attract new customers; particularly those who wish to avoid long-term
contracts or have an aesthetic or other objection to putting solar panels on their roofs.

 As
the solar industry grows and evolves, we will also face new competitors who are not currently in the market. Low technological barriers
to entry characterize our industry and well-capitalized companies could choose to enter the market and compete with it. Our failure to
adapt to changing market conditions and to compete successfully with existing or new competitors will limit our growth and will have
a material adverse effect on our business and prospects.

 Developments
in alternative technologies or improvements in distributed solar energy generation may materially adversely affect demand for our offerings.

 Significant
developments in alternative technologies, such as advances in other forms of distributed solar power generation, storage solutions such
as batteries, the widespread use or adoption of fuel cells for residential or commercial properties or improvements in other forms of
centralized power production may materially and adversely affect our business and prospects in ways management does not currently anticipate.
Any failure by us to adopt new or enhanced technologies or processes, or to react to changes in existing technologies, could materially
delay deployment of our solar energy systems, which could result in product obsolescence, the loss of competitiveness of our systems,
decreased revenue and a loss of market share to competitors.

 Due
to the limited number of suppliers in our industry, the acquisition of any of these suppliers by a competitor or any shortage, delay,
price change, imposition of tariffs or duties or other limitation in our ability to obtain components or technologies that we use could
result in sales and installation delays, cancellations, and loss of market share.

 While
we purchase our products from several different suppliers, if one or more of the suppliers on which we rely to meet anticipated demand
ceases or reduces production due to its financial condition, is acquired by a competitor or otherwise is unable to increase production
as industry demand increases, or is otherwise unable to allocate sufficient production to us, it may be difficult for us to quickly identify
alternate suppliers or to qualify alternative products on commercially reasonable terms, and our ability to satisfy this demand may be
adversely affected. There are a limited number of suppliers of solar energy system components and technologies. While we believe there
are other sources of supply for these products available, transitioning to a new supplier may result in additional costs and delays in
acquiring our solar products and deploying our systems. These issues could harm our business or financial performance.

 In
addition, the acquisition of a component supplier or technology provider by one of our competitors could limit our access to such components
or technologies and require significant redesigns of our solar energy systems or installation procedures and have a material adverse
effect on our business.

 There
have also been periods of industry-wide shortages of key components, including solar panels, in times of industry disruption. The manufacturing
infrastructure for some of these components has a long lead-time, requires significant capital investment and relies on the continued
availability of key commodity materials, potentially resulting in an inability to meet demand for these components. The solar industry
is frequently experiencing significant disruption and, as a result, shortages of key components, including solar panels, may be more
likely to occur, which in turn may result in price increases for such components. Even if industry-wide shortages do not occur, suppliers
may decide to allocate key components with high demand or insufficient production capacity to more profitable customers, customers with
long-term supply agreements or customers other than us and our supply of such components may be reduced as a result.

 Typically,
we purchase the components for our solar energy systems on an as-needed basis and do not operate under long-term supply agreements. The
vast majority of our purchases are denominated in U.S. dollars. Since our revenue is also generated in U.S. dollars, we are mostly insulated
from currency fluctuations. However, since our suppliers often incur a significant amount of their costs by purchasing raw materials
and generating operating expenses in foreign currencies, if the value of the U.S. dollar depreciates significantly or for a prolonged
period of time against these other currencies, this may cause our suppliers to raise the prices they charge us, which could harm our
financial results. Any supply shortages, delays, price changes or other limitation in our ability to obtain components or technologies
that we use could limit our growth, cause cancellations or adversely affect our profitability, and result in loss of market share and
damage to our brand.

 We
act as the licensed general contractor for our customers and are subject to risks associated with construction, cost overruns, delays,
regulatory compliance and other contingencies, any of which could have a material adverse effect on our business and results of operations.

 We
are a licensed contractor and we are normally the general contractor, electrician, construction manager, and installer for our solar
energy systems. We may be liable to customers for any damage that we cause to the home, business premises, belongings or property of
our customers during the installation of our systems. For example, we penetrate our customers' roofs during the installation process
and may incur liability for the failure to adequately weatherproof such penetrations following the completion of installation of solar
energy systems. In addition, because the solar energy systems that we deploy are high-voltage energy systems, we may incur liability
for the failure to comply with electrical standards and manufacturer recommendations. Because our profit on a particular installation
is based in part on assumptions as to the cost of such project, cost overruns, delays, or other execution issues may cause us to not
achieve our expected results or cover our costs for that project.

 In
addition, the installation of solar energy systems is subject to oversight and regulation in accordance with national, state, and local
laws and ordinances relating to building, fire and electrical codes, safety, environmental protection, utility interconnection and metering,
and related matters. We also rely on certain employees to maintain professional licenses in many of the jurisdictions in which we operate,
and our failure to employ properly licensed personnel could adversely affect our licensing status in those jurisdictions. It is difficult
and costly to track the requirements of every authority having jurisdiction over our operations and our solar energy systems. Any new
government regulations or utility policies pertaining to our systems, or changes to existing government regulations or utility policies
pertaining to our systems, may result in significant additional expenses to our customers and, as a result, could cause a significant
reduction in demand for our systems.

 If
we experience a significant disruption in our information technology systems or if we fail to implement new systems and software successfully,
our business could be adversely affected. A cyberattack could lead to a material disruption of our information technology systems or
the IT systems of our third-party providers and the loss of business information, which may hinder our ability to conduct our business
effectively and may result in lost revenues and additional costs.

 We
depend on information systems throughout our company to process orders, manage inventory, process and bill shipments and collect cash
from our customers, respond to customer inquiries, contribute to our overall internal control processes, maintain records of our property,
plant and equipment, and record and pay amounts due vendors and other creditors. If we were to experience a prolonged disruption in our
information systems that involve interactions with customers and suppliers, it could result in the loss of sales and customers and/or
increased costs, which could adversely affect our overall business operation.

 Compliance
with occupational safety and health requirements and best practices can be costly, and noncompliance with such requirements may result
in potentially significant monetary penalties, operational delays, and adverse publicity.

 The
installation of solar energy systems requires our employees to work at heights with complicated and potentially dangerous electrical
systems. The evaluation and modification of buildings as part of the installation process requires our employees to work in locations
that may contain potentially dangerous levels of asbestos, lead, mold or other materials known or believed to be hazardous to human health.
We also maintain a fleet of trucks and other vehicles to support our installers and operations. There is substantial risk of serious
injury or death if proper safety procedures are not followed. Our operations are subject to regulation under the U.S. Occupational Safety
and Health Act ("OSHA"), the U.S. Department of Transportation ("DOT"), and equivalent state laws. Changes to
OSHA or DOT requirements, or stricter interpretation or enforcement of existing laws or regulations, could result in increased costs.

 If
we fail to comply with applicable OSHA regulations, even if no work-related serious injury or death occurs, we may be subject to civil
or criminal enforcement and be required to pay substantial penalties, incur significant capital expenditures or suspend or limit operations.
While we have not experienced a high level of injuries to date, high injury rates could expose us to increased liability. In the past,
we have had workplace accidents and received citations from OSHA regulators for alleged safety violations, resulting in fines. Any such
accidents, citations, violations, injuries or failure to comply with industry best practices may subject us to adverse publicity, damage
our reputation and competitive position and adversely affect our business.

 Problems
with product quality or performance may cause us to incur warranty expenses, damage our market reputation, and prevent us from maintaining
or increasing our market share.

 If
our products fail to perform as expected while under warranty, or if we are unable to support the warranties, sales of our products may
be adversely affected, or our costs may increase, and our business, results of operations, and financial condition could be materially
and adversely affected.

 We
may also be subject to warranty or product liability claims against us that are not covered by insurance or are in excess of our available
insurance limits. In addition, quality issues can have various other ramifications, including delays in the recognition of revenue, loss
of revenue, loss of future sales opportunities, increased costs associated with repairing or replacing products, and a negative impact
on our goodwill and reputation. The possibility of future product failures could cause us to incur substantial expenses to repair or
replace defective products. Furthermore, widespread product failures may damage our market reputation and reduce our market share causing
sales to decline.

 Seasonality
may cause fluctuations in our financial results.

 We
often find that some customers tend to book projects by the end of a calendar year to realize the benefits of available subsidy programs
prior to year-end. This results in third and fourth quarter sales being more robust usually at the expense of the first quarter. In the
future, this seasonality may cause fluctuations in financial results. In addition, other seasonality trends may develop and the existing
seasonality that we experience may change. Weather can also be an important factor affecting project timelines.

 A
failure to comply with laws and regulations relating to our interactions with current or prospective commercial or residential customers
could result in negative publicity, claims, investigations, and litigation, and adversely affect our financial performance.

 Our
business includes contracts and transactions with commercial and residential customers. We must comply with numerous federal, state,
and local laws and regulations that govern matters relating to our interactions with residential consumers, including those pertaining
to privacy and data security, consumer financial and credit transactions, home improvement contracts, warranties, and door-to-door solicitation.
These laws and regulations are dynamic and subject to potentially differing interpretations, and various federal, state and local legislative
and regulatory bodies may expand current laws or regulations, or enact new laws and regulations, regarding these matters. Changes in
these laws or regulations or their interpretation could dramatically affect how we do business, acquire customers, and manage and use
information that we collect from and about current and prospective customers and the costs associated therewith. We strive to comply
with all applicable laws and regulations relating to our interactions with residential customers. It is possible, however, that these
requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other
rules or our practices. Non-compliance with any such law or regulations could also expose us to claims, proceedings, litigation and investigations
by private parties and regulatory authorities, as well as substantial fines and negative publicity, each of which may materially and
adversely affect our business.

 Changes
in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results
of operations.

 We
are subject to laws and regulations enacted by national, regional and local governments, including non-U.S. governments. In particular,
we are required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations
may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from
time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition,
a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business
and results of operations.

 Risks
Related to the Regulation of Our Company

 We
are an "emerging growth company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth
companies will make our Common Stock less attractive to investors.

 We
are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"),
and we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies
that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation
requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and
stockholder approval of any golden parachute payments not previously approved. We will remain an "emerging growth company"
for up to five years, although we will cease to be an "emerging growth company" upon the earliest of (i) the last day of
the fiscal year following the fifth anniversary of our initial public offering ("IPO"), (ii) the last day of the first fiscal
year in which our annual gross revenues are $1.07 billion or more, (iii) the date on which we have, during the previous rolling three-year
period, issued more than $1 billion in non-convertible debt securities or (iv) the date on which we are deemed to be a "large accelerated
filer" as defined in the Exchange Act. We cannot predict if investors will find shares of our Common Stock less attractive or us
less comparable to certain other public companies because we will rely on these exemptions. If some investors find our Common Stock less
attractive as a result, there may be a less active trading market for our Common Stock and our Common Stock price may be more volatile.

 Pursuant
to the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal
control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act for so long as we are an "emerging growth company."

 Section
404 of the Sarbanes-Oxley Act requires annual management assessments of the effectiveness of our internal control over financial reporting,
and generally requires in the same report a report by our independent registered public accounting firm on the effectiveness of our internal
control over financial reporting. However, under the JOBS Act, our independent registered public accounting firm is not required to attest to the effectiveness of
our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act until we are no longer an "emerging
growth company." We will be an "emerging growth company" until the earlier of (1) the last day of the fiscal year (a)
following the fifth anniversary of our IPO, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which
we are deemed to be a large accelerated filer, which means the market value of our Common Stock that is held by non-affiliates exceeds
$700 million as of the last business day of our prior second fiscal quarter, and (2) the date on which we have issued more than $1.0
billion in non-convertible debt during the prior three-year period.

 In
addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended
transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An "emerging
growth company" can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to
private companies. However, we have chosen to "opt out" of such extended transition period and, as a result, we must comply
with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth
companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new
or revised accounting standards is irrevocable.

 If
we are not able to comply with the applicable continued listing requirements or standards of Nasdaq, Nasdaq could delist our Common Stock.

 Our
Common Stock is currently listed on Nasdaq. In order to maintain such listing, we must satisfy minimum financial and other continued
listing requirements and standards, including those regarding director independence and independent committee requirements, minimum stockholders'
equity, minimum share price, and certain corporate governance requirements. There can be no assurances that we will be able to comply
with the applicable listing standards. Although we are currently in compliance with such listing standards, we may in the future fall
out of compliance with such standards. If we are unable to maintain compliance with these Nasdaq requirements, our Common Stock will
be delisted from Nasdaq.

 Our
Common Stock currently trades on Nasdaq, and, to date, trading of our Common Stock has been limited. If a more active market does not
develop, it may be difficult for you to sell the Common Stock you own or result in your sale at a price that is less than the price you
paid.

 To
date, trading of our Common Stock on Nasdaq has been limited and there can be no assurance that there will be a more active market for
our Common Stock either now or in the future. If a more active and liquid trading market does not develop or if developed cannot be sustained,
you may have difficulty selling any of the shares of Common Stock that you purchased. The market price for our Common Stock may decline
below the price you paid, and you may not be able to sell your shares of Common Stock at or above the price you paid, or at all.

 Notice
of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing

 On
May 16, 2023, the Company received a delisting notice from The Nasdaq Stock Market that it is no longer in compliance with Listing Rule
5550(a)(2), which requires listed securities to maintain a minimum bid price of $1 per share over a period of 30 consecutive business
days. Pursuant to Listing Rule 5810(c)(3)(A), the Company has a period of 180 calendar days following the receipt of the Delisting Notice
to regain compliance with the Bid Price Requirement, with the possibility of extension at the discretion of Nasdaq. Pursuant to the request
of the Company, Nasdaq extended the cure period to May 13, 2024. The Company can regain compliance with the Bid Price Requirement if
at any time during the cure period, the closing bid price of the Company's security is at least $1 for a minimum of ten consecutive
business days. The Delisting Notice does not affect the Company's business operations or its Securities and Exchange Commission
reporting requirements.

 In
the event that our Common Stock is delisted from Nasdaq, U.S. broker-dealers may be discouraged from effecting transactions in shares
of our Common Stock because they may be considered penny stocks and thus be subject to the penny stock rules.

 The
SEC has adopted a number of rules to regulate "penny stock" that restricts transactions involving stock which is deemed to
be penny stock. Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). These rules may have the effect of reducing the liquidity of penny stocks.
"Penny stocks" generally are equity securities with a price of less than $5.00 per share (other than securities registered
on certain national securities exchanges or quoted on NASDAQ if current price and volume information with respect to transactions in
such securities is provided by the exchange or system). Our shares of Common Stock have in the past constituted, and may again in the
future constitute, "penny stock" within the meaning of the rules. The additional sales practice and disclosure requirements
imposed upon U.S. broker-dealers may discourage such broker-dealers from effecting transactions in shares of our Common Stock, which
could severely limit the market liquidity of such shares of common stock and impede their sale in the secondary market.

 A
U.S. broker-dealer selling penny stock to anyone other than an established customer or "accredited investor" (generally,
an individual with a net worth in excess of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse)
must make a special suitability determination for the purchaser and must receive the purchaser's written consent to the transaction
prior to sale, unless the broker-dealer or the transaction is otherwise exempt. In addition, the "penny stock" regulations
require the U.S. broker-dealer to deliver, prior to any transaction involving a "penny stock", a disclosure schedule prepared
in accordance with SEC standards relating to the "penny stock" market, unless the broker-dealer or the transaction is otherwise
exempt. A U.S. broker-dealer is also required to disclose commissions payable to the U.S. broker-dealer and the registered representative
and current quotations for the securities. Finally, a U.S. broker-dealer is required to submit monthly statements disclosing recent price
information with respect to the "penny stock" held in a customer's account and information with respect to the limited
market in "penny stocks".

 Stockholders
should be aware that, according to the SEC, the market for "penny stocks" has suffered in recent years from patterns of fraud
and abuse. Such patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to
the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press
releases; (iii) "boiler room" practices involving high-pressure sales tactics and unrealistic price projections by inexperienced
sales persons; (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and (v) the wholesale dumping
of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, resulting in investor losses.
Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a
position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the
confines of practical limitations to prevent the described patterns from being established with respect to our securities.

 Anti-takeover
provisions contained in our Third Amended and Restated Certificate of Incorporation and Bylaws, as well as provisions of Delaware law,
could impair a takeover attempt.

 The
Company's Third Amended and Restated Certificate of Incorporation and Bylaws contain provisions that could have the effect of delaying
or preventing changes in control or changes in our management without the consent of our Board of Directors. These provisions include:

 A
 classified Board of Directors with three-year staggered terms, which may delay the ability
 of stockholders to the change the membership of a majority of our Board of Directors;

 no
 cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

 the
 exclusive right of our Board of Directors to elect a director to fill a vacancy created by the expansion of the Board of Directors
 or the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our Board of
 Directors;

 the
 ability of our Board of Directors to determine whether to issue shares of our preferred stock and to determine the price and other
 terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly
 dilute the ownership of a hostile acquirer;

 the
 requirement that an Annual Meeting of Stockholders may be called only by the Chairman of the Board of Directors, the Chief Executive
 officer, or the Board of Directors, which may delay the ability of our stockholders to force consideration of a proposal or to take
 action, including the removal of directors;

 limiting
 the liability of, and providing indemnification to, our directors and officers;

 controlling
 the procedures for the conduct and scheduling of stockholder meetings;

 providing
 that directors may be removed prior to the expiration of their terms by stockholders only for cause; and

 advance
 notice procedures that stockholders must comply with in order to nominate candidates to our Board of Directors or to propose matters
 to be acted upon at a stockholders' meeting, which may discourage or deter a potential acquirer from conducting a solicitation
 of proxies to elect the acquirer's own slate of directors or otherwise attempting to obtain control of the Company.

 These
provisions, alone or together, could delay hostile takeovers and changes in control of the Company or changes in our Board of Directors
and management.

 As
a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the General Corporation Law of the
State of Delaware ("DGCL"), which prevents some stockholders holding more than 15% of our outstanding Common Stock from engaging
in certain business combinations without approval of the holders of substantially all of our outstanding Common Stock. Any provision
of our Third Amended and Restated Certificate of Incorporation or Bylaws or Delaware law that has the effect of delaying or deterring
a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Common Stock and could
also affect the price that some investors are willing to pay for our Common Stock.

 Risks
Related to Offerings and Ownership of Our Common Stock

 The
issuance of our Common Stock pursuant to Form S-3 Registration Statements filed in the future may cause dilution and could cause the
price of our Common Stock to fall.

 A
substantial majority of the outstanding shares of our Common Stock and exercisable options are freely tradable without restriction or
further registration under the Securities Act of 1933, as amended.

 The Company filed an S-3 Registration Statement on
December 8, 2023. This Registration Statement has not been declared effective by the SEC. However, if deemed effective by the SEC, the
Registration Statement contains a Base Prospectus, which covers the offering, issuance and sale by iSun of up to $50,000,000 in the aggregate
of our shares of Common Stock from time to time in one or more offerings.

 Sales
of a substantial number of shares of our Common Stock in the public market, future sales of substantial amounts of shares of our Common
Stock in the public market, or the perception that these sales could occur, could cause the market price of our Common Stock to decline.
Increased sales of our Common Stock in the market for any reason could exert significant downward pressure on our stock price.

 The
share price of our Common Stock is subject to fluctuation, has been and may continue to be volatile and may decline regardless of our
operating performance, resulting in substantial losses for investors who have purchased shares of our Common Stock.

 We
expect that the market price of our Common Stock may continue to be volatile for the foreseeable future. The market price of our Common
Stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including the factors listed
below and other factors described in this "Risk Factors" section:

 actual
 or anticipated fluctuations in our operating results;

 the
 financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;

 failure
 of securities analysts to initiate or maintain coverage of our company, changes in financial estimates by any securities analysts
 who follow our company, or our failure to meet these estimates or the expectations of investors;

 ratings
 changes by any securities analysts who follow our company;

 announcements
 by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;

 changes
 in operating performance and Common stock market valuations of other technology companies generally;

 price
 and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;

 changes
 in our Board of Directors or management;

 sales
 of large blocks of our Common Stock, including sales by our executive officers, directors and significant stockholders;

 potential
 lawsuits threatened or filed against us;

 short
 sales, hedging and other derivative transactions involving our Common Stock;

 general
 economic conditions in the United States and abroad; and

 other
 events or factors, including those resulting from war, incidents of terrorism or responses to these events.

 In
addition, stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices
of equity securities of many energy companies. Stock prices of many energy companies have fluctuated in a manner unrelated or disproportionate
to the operating performance of those companies. In the past, stockholders have instituted securities action litigation following periods
of market volatility. If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources
and the attention of management from our business and adversely affect our business, operating results, financial condition and cash
flows.

 We
have no history of paying dividends on our Common Stock, and we do not anticipate paying dividends in the foreseeable future.

 We
have not previously paid dividends on our Common Stock. We currently anticipate that we will retain all of our available cash, if any,
for use as working capital and for other general corporate purposes. Any payment of future dividends will be at the discretion of our
Board of Directors and will depend upon, among other things, our earnings, financial condition, capital requirements, level of indebtedness,
statutory and contractual restrictions applicable to the payment of dividends and other considerations that our Board of Directors deems
relevant. Investors must rely on sales of their Common Stock after price appreciation, which may never occur, as the only way to realize
a return on their investment.

 Our
Third Amended and Restated Certificate of Incorporation authorizes us to issue shares of blank check preferred stock, and issuances of
such preferred stock, or securities convertible into or exercisable for such preferred stock, may result in immediate dilution to existing
stockholders.

 If
we raise additional funds through future issuances of preferred stock or debt securities convertible into preferred stock, our stockholders
could suffer significant dilution, and any new preferred stock or debt securities that we issue could have rights, preferences and privileges
superior to those of holders of shares of Common Stock. Although we have no present plans to issue any additional shares of preferred
stock, in the event that we issue additional shares of our preferred stock, or securities convertible into or exercisable for such preferred
stock, the holders of Common Stock will be diluted. We may choose to raise additional capital using such preferred stock or debt securities
because of market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future
operating plans.

 A
market for our securities may not continue, which would adversely affect the liquidity and price of our securities.

 The
price of our securities may fluctuate significantly due to general market and economic conditions. An active trading market for our securities
may never develop or, if developed, it may not be sustained. In addition, the price of our securities can vary due to general economic
conditions and forecasts, our general business condition and the release of our financial reports. Additionally, if our securities become
delisted from Nasdaq for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity
securities that is not a national securities exchange, the liquidity and price of our securities may be more limited than if we were
quoted or listed on Nasdaq or another national securities exchange. You may be unable to sell your securities unless a market can be
established or sustained.

 If
securities or industry analysts do not publish or cease publishing research or reports about us, our business, or our market, or if they
change their recommendations regarding our Common Stock adversely, the price and trading volume of our Common Stock could decline.

 The
trading market for our Common Stock will be influenced by the research and reports that industry or securities analysts may publish about
us, our business, our market, or our competitors. Securities and industry analysts do not currently, and may never, publish research
on us. If no securities or industry analysts provide coverage of us, our stock price and trading volume would likely be negatively impacted.
If any of the analysts who may cover us change their recommendation regarding our Common Stock adversely, or provide more favorable relative
recommendations about our competitors, the price of our Common Stock would likely decline. If any analyst who may cover us were to cease
coverage of us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our Common
Stock price or trading volume to decline.

 Our
executive officers, directors and principal stockholders own a significant percentage of our Common Stock and will be able to exert significant
control over matters subject to stockholder approval.

 As
of April 16, 2024 our directors, executive officers and holders of more than 5% of our equity securities, together with their affiliates,
beneficially own approximately 11.6% of our outstanding shares of Common Stock. As a result, these stockholders have significant influence
to determine the outcome of matters submitted to our stockholders for approval, including the ability to control the election of our
directors, amend or prevent amendment of our Third Amended and Restated Certificate of Incorporation or Bylaws or effect or prevent a
change in corporate control, merger, consolidation, takeover or other business combination. In addition, any sale of a significant amount
of our Common Stock held by our directors, executive officers and principal stockholders, or the possibility of such sales, could adversely
affect the market price of our Common Stock. Our management's stock ownership may also discourage a potential acquirer from making
a tender offer or otherwise attempting to obtain control of us, which in turn could reduce our Common Stock price or prevent our stockholders
from realizing any gains from our Common Stock.

 Implications
of Being an "Emerging Growth Company"

 As
a public reporting company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an "emerging growth
company" under the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). An emerging growth company may take
advantage of specified reduced reporting requirements that are otherwise generally applicable to public companies. In particular, as
an emerging growth company, we:

 are
 not required to obtain an attestation and report from our auditors on our management's assessment of our internal control over
 financial reporting pursuant to the Sarbanes-Oxley Act (the "Sarbanes-Oxley Act");

 are
 not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing
 how those elements fit with our principles and objectives (commonly referred to as "compensation discussion and analysis");

 are
 not required to obtain a non-binding advisory vote from our stockholders on executive compensation or golden parachute arrangements
 (commonly referred to as the "say-on-pay," "say-on-frequency" and "say-on-golden-parachute" votes);

 are
 exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratio disclosure;

 may
 present only two years of audited financial statements and only two years of related Management's Discussion and Analysis of
 Financial Condition and Results of Operations ("MD&A") disclosure; and

 are
 eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under §107 of the
 JOBS Act.

 We
intend to take advantage of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the
adoption of new or revised financial accounting standards under §107 of the JOBS Act. Our election to use the phase-in periods may
make it difficult to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that
have opted out of the phase-in periods under §107 of the JOBS Act.

 Certain
of these reduced reporting requirements and exemptions were already available to us due to the fact that we also qualify as a "smaller
reporting company" under the SEC's rules. For instance, smaller reporting companies are not required to obtain an auditor
attestation and report regarding internal control over financial reporting, are not required to provide a compensation discussion and
analysis, are not required to provide a pay-for-performance graph or CEO pay ratio disclosure, and may present only two years of audited
financial statements and related MD&A disclosure.

 Under
the JOBS Act, we may take advantage of the above-described reduced reporting requirements and exemptions for up to five years after our
initial sale of common equity pursuant to a registration statement declared effective under the Securities Act, or such earlier time
that we no longer meet the definition of an emerging growth company. In this regard, the JOBS Act provides that we would cease to be
an "emerging growth company" if we have more than $1.07 billion in annual revenue, have more than $700 million in market
value of our Common Stock held by non-affiliates, or issue more than $1 billion in principal amount of non-convertible debt over a three-year
period. Under current SEC rules, however, we will continue to qualify as a "smaller reporting company" for so long as we
have a public float (i.e., the market value of common equity held by non-affiliates) of less than $700 million and annual revenue of
less than $100 million as of the last business day of our most recently completed second fiscal quarter.

 Item
 1B.

 Unresolved
 Staff Comments.

 None.

 Item
 1C.

 Cybersecurity
 & Governance

 Cybersecurity
Risk Management

 We,
like other companies in our industry, face several cybersecurity risks in connection with our business. Our business strategy, results
of operations, and financial condition have not, to date, been affected by risks from cybersecurity threats. During the reporting period,
we have not experienced any material cyber incidents, nor have we experienced a series of immaterial incidents, which would require disclosure.

 In
the ordinary course of our business, we use, store and process a bare minimum of data. To effectively prevent, detect, and respond to
cybersecurity threats, we maintain a cyber risk management program, which is comprised of data segregation, penetration testing, and
training. The cyber risk management program falls under the responsibility of a third party IT consultant, who has cross-functional expertise
in IT management, cybersecurity, and engineering with more than 30 years of experience (the "IT Consultant"), who reports
directly to our Chief Financial Officer. Under the guidance of the IT Consultant, we have minimized our data footprint to keep our cyber
risk low.

 We
have implemented a cybersecurity risk management program that is designed to limit and mitigate risks from cybersecurity threats. Our
cybersecurity risk management program incorporates several components, including employee training, periodic penetration tests, and multifactor
authentications.

 Governance

 Under
the ultimate direction of our CFO, with oversight from the Board, we maintain a security governance structure to evaluate and address
cyber risk.

 Our
Board is responsible for the oversight of cybersecurity risk management. The Board delegates oversight of the cybersecurity risk management
program to the Audit Committee. On a quarterly and as-needed basis, the CFO reports to the Audit Committee on our cybersecurity risk
management program, including any critical cybersecurity risks, ongoing cybersecurity initiatives and strategies, and applicable regulatory
requirements and industry standards. The CFO also provides updates to the Audit Committee of any cybersecurity incidents (suspected or
actual) and provides updates on the incidents as well as cybersecurity risk mitigation activities as appropriate.

 Item
 2.

 Properties.

 We
leased and occupy 6,250 square feet of office space and 6,750 square feet of warehouse space at 400 Avenue D, Suite 10, Williston, VT
05495. Solar Communities, Inc. our indirect wholly-owned subsidiary leases and occupies 8,640 square feet of office space and 5,360 square
feet of warehouse space in Waterbury, Vermont and 15,000 square feet of warehouse space, 10,000 square feet of shop space and 5,000 square
feet of office space in Rhinebeck, New York. The Company also leases approximately 3,000 square feet of office and warehouse space in
Salem NH. We believe that these spaces are sufficient to meet our current needs across all business segments.

 Item
 3.

 Legal
 Proceedings

 On
January 27, 2022, the Company became aware of pending litigation in the U.S. District Court for the District of Vermont, entitled Sassoon
Peress and Renewz Sustainable Solutions, Inc. v. iSun, Inc., alleging various claims including breach of contract, defamation, and unjust
enrichment arising out of the acquisition of iSun Energy, LLC, the sole owner of which was Mr. Peress. The litigation seeks legal and
equitable remedies. The Company was granted an extension of time to plead to Plaintiffs' Amended Complaint until April 29, 2022.
On January 17, 2023, the Company entered into a settlement agreement effectively resolving all claims with no additional consideration
paid as a result of settlement.

 On
February 13, 2024, the Company became aware of pending litigation in the U.S. District Court for the District of Vermont, entitled Duane
Peterson, James Moore and Jeffrey Irish, solely in their capacity as Shareholder Representative Group v. iSun Inc., alleging breach of
contract/collection. iSun Inc.'s responsive pleading was made on March 15, 2024. iSun, Inc. plans to vigorously contest this litigation.
At this stage it is not possible to evaluate the likelihood of an unfavorable outcome or provide an estimate of the range of potential
loss.

 On
January 2, 2024, the Company became aware of pending litigation in the U.S. District Court for the District of North Carolina,
entitled Alpha Engineering Services, P.A. d/b/a Alpha Environmental v. iSun Corporate, LLC, alleging breach of contract and a second
alternative claim for relief in Quantum Meruit. The Company filed a responsive pleading by March 20, 2024. The
Company's responses to the first set of interrogatories and request for production of documents is currently due April
15 th. iSun Corporate, LLC. plans to vigorously contest this litigation. At this stage it is not possible to evaluate the
likelihood of an unfavorable outcome or provide an estimate of the range of potential loss.

 Item
 4.

 Mine
 Safety Disclosures.

 Not
applicable.

 PART
II

 Item
 5.

 Market
 for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

 Our
Common Stock is traded on Nasdaq under the symbol "ISUN." The last reported sale price of our Common Stock on April 12,
2024 on Nasdaq was $0.22 per share

 Holders
of Common Stock.

 On
April 8, 2024, we had 461 registered holders of record of our Common Stock.

 Dividends
and dividend policy.

 We
have never declared or paid any cash dividend on our Common Stock, nor do we currently intend to pay any cash dividend on our Common
Stock in the foreseeable future. We expect to retain our earnings, if any, for the growth and development of our business.

 Item
 6.

 Reserved

 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 our consolidated
financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K. This discussion and analysis contains
forward-looking statements that involve risks, uncertainties and assumptions. The actual results may differ materially from those anticipated
in these forward-looking statements as a result of certain factors, including, but not limited to, those set forth under "Risk
Factors" and elsewhere in this Annual Report on Form 10-K.

 Business
Introduction / Overview

 Throughout
our 50-year history, we have always embraced innovative change. There has never been a more meaningful, or impactful time to be a leader
in the innovation that will help fight climate change. We have built a team that is passionate about transitioning American power generation
and consumption to clean solar energy, we are passionately focused on our mission to accelerate the adoption of solar energy.

 We
are one of the largest solar energy services and infrastructure deployment companies in the country and are expanding across the United
States. Our services include solar, storage and electric vehicle infrastructure, design, development and professional services, engineering,
procurement, installation, O&M and storage. We uniquely target all solar markets including residential, commercial, industrial and
utility segments.

 Prior
to becoming a public company, we were a second-generation family business founded under the name Peck Electric Co. in 1972 as a
traditional electrical contractor. Our core values were and still are to align people, purpose, and profitability, and since taking
leadership in 1994, Jeffrey Peck, our Chief Executive Officer and Interim Chief Financial Officer, has applied such core values to
expand into the solar industry. Today, we are guided by the mission to facilitate the reduction of carbon emissions through the
expansion of clean, renewable energy and we believe that leveraging such core values to deploy resources toward profitable business
is the only sustainable strategy to achieve these objectives. We have positioned the company to serve all segments of the rapidly
evolving energy markets. We are able to originate valuable solar assets through our development and design services team. We are
able to leverage our digital sales and marketing capabilities to generate high quality leads for our Residential, Commercial and
Industrial divisions. Our experience provides for the high-quality craftsmanship required for installing long-term assets for all
customers. Our team approach allows us to collaborate across divisions in order to efficiently utilize our internal labor resources.
The diversity of our service offerings allows us to serve our customer needs in the evolving energy environment.

 On
January 19, 2021, we completed a business combination (the "Merger Agreement") pursuant to which we acquired iSun Energy
LLC ("iSun Energy"). The Business Combination was an acquisition treated as a merger and reorganization and iSun Energy became
a wholly owned subsidiary of The Peck Company Holdings, Inc. Immediately prior to the business combination, we changed our name to iSun,
Inc. (the "Company").

 On
April 6, 2021, iSun Utility, LLC ("iSun Utility"), a Delaware limited liability company and wholly-owned subsidiary of the
Company, Adani Solar USA, Inc., a Delaware corporation (Adani"), and Oakwood Construction Services, Inc., a Delaware corporation
("Oakwood") entered into an Assignment Agreement (the "Assignment"), pursuant to which iSun Utility acquired
all rights to the intellectual property of Oakwood and its affiliates (the "Project IP"). Oakwood was a utility-scale solar
EPC, Development and Design company and a wholly-owned subsidiary of Adani. The Project IP included all of the intellectual property,
project references, templates, client lists, agreements, forms and processes of Adani's U.S. solar business.

 On
September 8, 2021, iSun, Inc. entered into an Agreement and Plan of Merger (the "Merger Agreement") by and among the Company,
iSun Residential Merger Sub, Inc., a Vermont corporation (the "Merger Sub") and wholly-owned subsidiary of iSun Residential,
Inc., a Delaware corporation ("iSun Residential") and wholly-owned subsidiary of the Company, SolarCommunities, Inc., d/b/a
SunCommon, a Vermont benefit corporation ("SunCommon"), and Jeffrey Irish, James Moore, and Duane Peterson as a "Shareholder
Representative Group" of the holders of SunCommon's capital stock (the "SunCommon Shareholders"), pursuant to
which the Merger Sub merged with and into SunCommon (the "Merger") with SunCommon as the surviving company in the Merger
and SunCommon became a wholly-owned subsidiary of iSun Residential. The Merger was effective on October 1, 2021.

 We
now conduct all of our business operations exclusively through our direct and indirect wholly-owned subsidiaries, iSun Residential, Inc.,
SolarCommunities, Inc. iSun Industrial, LLC, Peck Electric Co., Liberty Electric, Inc., iSun Utility, LLC, iSun Energy, LLC and iSun
Corporate, LLC.

 The
world recognizes the need to transition to a reliable, renewable energy grid in the next 50 years. States from Vermont to Hawaii are
leading the way in the U.S. with renewable energy goals of 75% by 2032 and 100% by 2045, respectively. California committed to 100% carbon-free
energy by 2045. The majority of the other states in the U.S. also have renewable energy goals, regardless of current Federal solar policy.
We are a member of Renewable Energy Vermont, an organization that advocates for clean, practical and renewable solar energy. The benefits
of the newly enacted Inflation Reduction Act of 2022 ("IRA") provide stability and certainty of incentives for the next 10
years that create value to our shareholders and provides a long-term commitment for the energy transformation. Our triple bottom line,
which is geared towards people, environment, and profit, has always been our guide since we began installing renewable energy and we
intend that it remain our guide over the next 50 years as we construct our energy future.

 We
primarily provide services to solar energy customers for projects ranging in size from several kilowatts for residential loads to multi-megawatt
systems for commercial, industrial and utility projects. We have installed over 600 megawatts of solar systems since inception and are
focused on profitable growth opportunities. We believe that we are well-positioned for what we believe to be the coming transformation
to an all renewable energy economy. We are expanding across the United States to serve the fast-growing demand for clean renewable energy.
We are open to partnering with others to accelerate our growth process, and we are expanding our portfolio of company-owned solar arrays
to establish recurring revenue streams for many years to come. We have established a leading presence in the market after five decades
of successfully serving our customers, and we are now ready for new opportunities and the next five decades of success.

 The
diverse nature of our service offerings allows us to manage our operations based on the maximization of value for our customers in the
evolving energy market. Our core revenue stream is generated from our engineering, procurement and installation services and products
consisting of solar, electrical and data installations but has expanded to include project origination, design and development services
as well.. Approximately 85% of our revenue is derived from our solar EPC business, approximately 10% of revenue is derived from our
electrical and data business and approximately 5% of revenue is derived from our project origination, development and design services.
Recently our growth has been derived by increasing our solar customer base starting in 2013, mergers and acquisitions and expansion into
new territories. We currently operate in Vermont, Maine, New Hampshire, New York, Massachusetts, Maryland, Alabama, Georgia and North
and South Carolina. Our union crews are expert constructors, and union access to an additional workforce makes us ready for rapid expansion
to other states while maintaining control of operating costs. The skillset provided by our workforce is transferrable among our service
offerings depending on current demand.

 We
also make investments in solar development projects and currently own approximately three megawatts of operating solar arrays operating
under long-term power purchase agreements. Our joint ventures allow for a retained ownership in originated projects. These long-term
recurring revenue streams, combined with our in-house development and construction capabilities, make this asset class a strategic long-term
investment opportunity for us.

 Critical
Accounting Estimates

 The
preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events
that affect the amounts reported in the financial statements and accompanying notes. Future events and their effects cannot be determined
with absolute certainty. Therefore, the determination of estimates requires the exercise of judgment. Actual results inevitably will
differ from those estimates, and such differences may be material to the financial statements. The most significant accounting estimates
inherent in the preparation of our financial statements include estimates used to review the Company's impairment analysis of its
intangible assets, impairment on investment, the valuation of the Company's Series A Preferred Stock using the Monte Carlo simulation
and revenue recognition utilizing a cost-to-cost method.

 In
order to get a full understanding of our financial statements, one must have a clear understanding of the critical accounting estimates
employed by the Company. A summary of our critical accounting estimates are as follows:

Recognition

 In
general, we provide the sale of solar power systems, Engineering, Procurement and Construction ("EPC") services, and other
construction type contracts over time, as performance obligations are satisfied, due to the continuous transfer of control to the customer.
Construction contracts, such as the sale of a solar power system combined with EPC services, are generally accounted for as a single
unit of account (a single performance obligation) and are not segmented between types of services. Our contracts often require significant
services to integrate complex activities and equipment into a single deliverable, and are therefore generally accounted for as a single
performance obligation, even when delivering multiple distinct services. For such services, the Company recognizes revenue using the
cost to cost method, based primarily on contract cost incurred to date compared to total estimated contract cost. The cost to cost method
(an input method) is the most faithful depiction of the Company's performance because it directly measures the value of the services
transferred to the customer. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are
determined as assessed at the contract level. Pre-contract costs are expensed as incurred unless they are expected to be recovered from
the customer.

 The
nature of the Company's contracts gives rise to several types of variable consideration, including claims and unpriced change orders;
award and incentive fees; and liquidated damages and penalties. The Company recognizes revenue for variable consideration when it is
probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount
of revenue to be recognized on variable consideration using the expected value (i.e., the sum of a probability-weighted amount) or the
most likely amount method, whichever is expected to better predict the amount.

 Remaining
performance obligations, or backlog, represents the aggregate amount of the transaction price allocated to the remaining obligations
that the Company has not performed under its customer contracts. The Company has elected to use the optional exemption in ASC 606-10-50-14,
which exempts an entity from such disclosures if a performance obligation is part of a contract with an original expected duration of
one year or less.

 Valuation
of the Company's Series A Preferred Stock

 On
December 12, 2023, we issued an aggregate amount of 300,000 of our Series A Convertible Preferred Stock that resulted in a $3,882 addition
to derivative liabilities due to the Company not having enough authorized shares in the event of a full redemption. The Company utilized
a Monte Carlo simulation to determine the fair value at the time of issuance. We used two scenarios to calculate the fair value of the
Series A Convertible Preferred Stock which included: a) The Preferred Shares are held until Redemption and b) The Preferred Shares are
Converted to Common Shares. We determined that 6,694 simulations out of 20,000 simulations had a Common stock price that was equal to
or greater than $0.857. Therefore, there is a 33.47% probability that shareholders will convert to Common shares. Conversely, there is
a 66.53% probability that shareholders will hold the Preferred shares until the redemption date. We then applied the present value of
holding the Preferred shares until the redemption date and converting the Preferred shares to Common shares to their respective probabilities.
This results in a total present value of $3,882 and a per share value of $12.94.

 RESULTS
OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2023 COMPARED TO THE YEAR ENDED DECEMBER 31, 2022

 REVENUE
AND COST OF EARNED REVENUE

 For
the year ended December 31, 2023, our revenue increased 25.2% to a record of high of $95.7 million compared to $76.5 million for the
year ended December 31, 2022. Cost of earned revenue for the year ended December 31, 2023, was 28.7% higher at $77.8 million compared
to $60.5 million for the year ended December 31, 2022. Our revenue increased as a result of the deployment of our robust suite of services
over a full year. In addition to our historical commercial and industrial customer base, we added the capabilities to serve residential,
small commercial and utility customers as well as support the demand for electric vehicle infrastructure across all our customer demographics.
For the year ended December 31, 2023, our residential division represented 35% of our revenue mix compared to 52% for the year ended
December 31, 2022. For the year ended December 31, 2023, our commercial and industrial division represented 65% of our revenue mix compared
to 43% for the year ended December 31, 2022 For the year ended December 31, 2023, our utility, design and development division represented
1% of our revenue mix compared to 5% for the year ended December 31, 2022.

 Income before operating expenses was $17.9 million for the year ended December 31, 2023. This compares to 16.0 million of income before operating expenses for the year ended December
31, 2022. The gross margin was 18.7% in the year ended December 31, 2023 compared to 20.9% in the year ended December 31, 2022. Approximately
84% and 90% of revenues for the years ended December 31, 2023 and 2022 were from solar installations. The residential revenue, on an
annualized basis, grew at a higher rate than the commercial and industrial revenue. The margin decrease was driven by a decrease
in the residential installation revenue mix which operates at a higher margin than our commercial and industrial division. Since the
residential backlog is completed on a more frequent basis than the other divisions, it is anticipated that the higher margin will be
maintained on a go-forward basis.

 For
2024, we anticipate an approximately 5% increase in revenue over 2023 due to several factors. The demand for solar and electric
vehicle infrastructure continues to increase across all customer groups. Our residential division has customer orders of
approximately $13.4 million expected to be completed within four to six months, our commercial division has a contracted backlog of
approximately $26.8 million expected to be completed within six to eight months and our industrial division has a contracted backlog
of approximately $120.0 million expected to be completed within twelve to eighteen months. Historically, we have engaged with
existing customers throughout the Northeast. The capabilities of our development and professional services team have allowed us to
engage in project development in new geographic regions which will further our expansion opportunities.

 SELLING
AND MARKETING EXPENSES

 We
rely on referrals from customers and on our industry reputation, and therefore have not historically incurred significant selling and
marketing expenses. Total selling and marketing expenses, included in general and administrative expenses, decreased to $1.1 million
for the year ended December 31, 2023 compared to $1.2 million for the year ended December 31, 2022. Selling and marketing expenses were
incurred by SunCommon. SunCommon is a wholly-owned subsidiary and our residential division brand and will incur marketing expenses as
a means to generate sales demand.

 GENERAL
AND ADMINISTRATIVE EXPENSES

 Total
general and administrative ("G&A") expenses were $21.6 million for the year ended December 31, 2023, compared to
$22.4 million for the year ended December 31, 2022. As a percentage of revenue, G&A expenses decreased 6.7% to 22.6% for the
year ended December 31, 2023 compared to
29.3% in the year ended December 31, 2022. The decrease in G&A for the year ended December 31, 2023 was attributable to
efficiencies resulting from the second full year of operations of our newly acquired subsidiaries. As we continue to generate
efficiencies through shared services and a consolidation of overhead, we expect our G&A expenses to remain consistent
through our next revenue scale but decrease as a percentage of revenue.

 WAREHOUSE
AND OTHER OPERATING EXPENSES

 Warehousing
and other operating expenses decreased to $0.8 million for the year ended December 31, 2023, compared to $1.8 million for the year ended
December 31, 2022. The decrease was due to efficiencies generated by two full years of operations of the entities acquired in 2021.

 IMPAIRMENT
OF GOODWILL

the year ended December 31, 2022, we experienced a significant decline in our market capitalization, which continued into the first quarter
of 2023, and management deemed such decline a triggering event related to goodwill. As a result, we performed an impairment assessment
as of December 31, 2022 and determined that impacts of supply chain shortage, the anti-circumvention investigation and labor shortages
have depressed market capitalizations across our peer group in the solar industry.

 We
utilized a weighted combination of the income-based approach and market-based approach to determine the fair value. Key assumptions used
in the income-based approach included forecasts of revenue, operating income, cash flows, terminal growth rates and discount rates associated
for the risks associated with the operations at the time of the assessment. Key assumptions used in the market-based approach included
the selection of recent acquisitions by appropriate peer companies and associated valuation multiples. Our assessment, which was largely
based on backlog of $164.2 million of revenue, yielded a range of valuations that were approximately 15% to 20% above carrying value.
Due to the depressed market capitalizations across our peer groups, we believe that the current market capitalization is not an appropriate
indicator of our valuation. Our income-based valuation, as well as that of independent analysts, provided results in excess of our carrying
value. As we continue our growth towards cash flow positive operations, we believe that our market capitalization will appreciate to
reflect our appropriate valuation. Although we believe, but we cannot say with a high degree of certainty that the decline in our market
capitalization is temporary, in reconciling our current market capitalization to our carrying value, an impairment in the amount of $37.2
million was recorded consistent with U.S. GAAP.

 IMPAIRMENT
OF INVESTMENTS

the year ended December 31, 2023, management deemed the value of certain investments to be impaired and the Company recorded impairment
expense of $4.0 million. Reasonable attempts by management to obtain updated financial information related to these investments, including
financial statements, forecasts and dividend information were unsuccessful.

 DEPRECIATION
AND AMORTIZATION

 Depreciation
and amortization expense for the year ended December 31, 2023 was $3.1 million compared to $7.1 million for the same period of the
prior year, due to intangibles relating to backlog being completely amortized in 2022.

 OTHER
INCOME (EXPENSE)

 Interest
expense for the year ended December 31, 2023 was $1.7 million compared to $1.4 million for the same period of the prior year. For the
year ended December 31, 2023, we recognized a loss on extinguishment of debt of $3.1 million, which was associated with the repayment of the Anson debt. We recognized a gain on the forgiveness
of PPP loan of $2.6 million for the year December 31, 2022. We recognized
a loss for the change in fair value of the warrant liability of $0.2 million for the year ended December 31, 2023 and a gain $0.1 million
for the year ended December 31, 2022.

 INCOME
(BENEFIT) TAX EXPENSE

 The
U.S. GAAP effective tax rate for the years ended December 31, 2023 was 0.23% and December 31, 2022 was 4.36%. The proforma effective
tax rate for the years ended December 31, 2023 was 21.0% and December 31, 2022 was 21.0%. At December 31, 2023 and 2022, the change in
the effective tax rate ("ETR") is driven by the non-taxable income generated from the forgiveness of a loan under the CARES
Act Payroll Protection Program ("PPP") of $0 million and $2.6 million, respectively.

 NET
LOSS

 The
net loss for the year ended December 31, 2023 was $19.4 million compared to a net loss of $53.8 million for the year ended December 31,
2022.

 Certain
Non-GAAP Measures

 We
periodically review the following key non-GAAP measures to evaluate our business and trends, measure our performance, prepare financial
projections, and make strategic decisions.

 EBITDA
and Adjusted EBITDA

 Included
in this presentation are discussions and reconciliations of earnings before interest, income tax and depreciation and amortization ("EBITDA")
and EBITDA adjusted for certain non-cash, non-recurring or non-core expenses ("Adjusted EBITDA") to net loss in accordance
with GAAP. Adjusted EBITDA excludes certain non-cash and other expenses, certain legal services costs, professional and consulting fees
and expenses. We believe that these non-GAAP measures illustrate the underlying financial and business trends relating to our results
of operations and comparability between current and prior periods. We also use these non-GAAP measures to establish and monitor operational
goals.

 These
non-GAAP measures are not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute
or superior to, the other measures of financial performance prepared in accordance with GAAP. Using only the non-GAAP financial measures,
particularly Adjusted EBITDA, to analyze our performance would have material limitations because such calculations are based on a subjective
determination regarding the nature and classification of events and circumstances that investors may find significant. We compensate
for these limitations by presenting both the GAAP and non-GAAP measures of our operating results. Although other companies may report
measures entitled "Adjusted EBITDA" or similar in nature, numerous methods may exist for calculating a company's Adjusted
EBITDA or similar measures. As a result, the methods that we use to calculate Adjusted EBITDA may differ from the methods used by other
companies to calculate their non-GAAP measures.

 The
reconciliations of EBITDA and Adjusted EBITDA to net loss, the most directly comparable financial measure calculated and presented in
accordance with GAAP, are shown in the table below:

 Year ended

 2023

 2022

 $
 (19,417
)

 $
 (53,779
)

 Depreciation and amortization

 3,069

 7,071

 Impairment of goodwill

 -

 Impairment of Investment

 4,020

 -

 Interest expense

 1,694

 1,351

 Stock based compensation

 1,079

 2,981

 Change in fair value of warrant liability

 (138
)

 Loss on extinguishment of debt

 3,076

 -

 Financing costs

 -

 Other financing costs

 -

 Other expense

 Income tax expense (benefit)

 (752
)

 EBITDA

 (4,526
)

 (5,612
)

 Other costs (1)

 Adjusted EBITDA

 $
 (4,176
)

 $
 (5,098
)

 Weighted Average shares outstanding

 26,703,958

 14,089,499

 Adjusted EPS

 $
 (0.16
)

 $
 (0.36
)

 (1)

 For
 the years ended December 31, 2023 and 2022, other costs consisted of one-time expenses incurred related to the settlement of a
 lawsuit and fees related to a financing that did not go through

 LIQUIDITY
AND GOING CONCERN

 We
had $3.5 million in unrestricted cash at December 31, 2023, as compared to $5.5 million at December 31, 2022.

 As
of December 31, 2023, we had a working capital deficiency of $3.9 million. During the years ended December 31, 2023 and 2022, we
incurred net losses of $19.4 million and $53.8 million, respectively, and used cash in operations of $8.9 million and $6.3 million, respectfully. We have historically incurred operating losses and may continue to incur operating losses for the foreseeable future.

 We
believe that these conditions raise substantial doubt about our ability to continue as a going concern for at least one year from
the date these financial statements are issued. This may hinder our future ability to obtain new financing or may force us to obtain
financing on less favorable terms than would otherwise be available. Our plans include continued efforts to raise additional
capital through debt and equity financings. There is no assurance that these funds will be sufficient to enable us to achieve
profitable operations. If we are unable to obtain such additional financing on a timely basis it may have a material
adverse effect on our business, financial condition and results of operations, and ultimately we could be
forced to discontinue our operations and liquidate.

 Cash
flows used in operating activities was $8.9 million and $6.3 million for the years ended December 31, 2023 and 2022, respectively.
The net cash used in operating activities for the year ended December 31, 2023 was primarily due to cash used to fund a net loss of
$19.4 million, adjusted for net non-cash expenses in the aggregate amount of $13.2 million, partially offset by $2.7 million of net
cash provided by the changes in the levels of operating assets and liabilities.

 Net
cash used in investing activities was $0.8 million for the year ended December 31, 2023, compared to $1.2 million of net cash
used in investing activities in the year ended December 31, 2022. The change was largely attributable to the purchase of
equipment in 2023 for $0.6 million. In addition, there were proceeds from the sale of property and equipment of $1.3 million during the year ended December
31, 2022.

 Net
cash provided by financing activities was $7.8 million for the year ended December 31, 2023 compared to $8.4 million of cash provided
by financing activities for the year ended December 31, 2022. Cash flow provided by financing activities for the year ended December
31, 2023 was primarily driven by proceeds from the sale of common stock of $7.7 million and proceeds from the issuance of notes payable
of $7.9 million offset by the repayments of long-term debt of $7.9 million.

 Item
 7A.

 Quantitative
 and Qualitative Disclosures about Market Risk

 Interest
Rate Risk

 As
of December 31, 2023, our fixed interest rate debt of $13.6 million aggregate principal amount of which accrued interest at a weighted
average interest rate of approximately 5.0%. None of this debt subjects us to interest rate risk, but we may be subject to changes in
interest rates if and when we refinance this debt at maturity or otherwise.

 Off-Balance
Sheet Arrangements

 The
Company does not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on its financial
condition, revenues, results of operations, liquidity, or capital expenditures.

 Item
 8.

 Financial
 Statements and Supplementary Data.

to Consolidated Financial Statements

 Report of Independent Registered Public Accounting Firm (PCAOB ID: 688)

 Consolidated Balance Sheets

 Consolidated Statements of Operations

 Statements of Changes in Stockholder's Equity

 Consolidated Statements of Cash Flows

 Notes to Consolidated Financial Statements

 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To
the Stockholders and Board of Directors of

 iSun,
Inc.

 Opinion
on the Financial Statements

 We
have audited the accompanying consolidated balance sheets of iSun, Inc. (the "Company") as of December 31, 2023 and 2022,
the related consolidated statements of operations, changes in stockholders' equity and cash
flows for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the "financial
statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the
Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the two years in the period
ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

 Explanatory Paragraph – Going Concern

 The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As more fully described in Note 3, the Company has a significant working capital deficiency,
has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions
raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters are
also described in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this
uncertainty.

 Basis
for Opinion

 These
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's
financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits
we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.

 /s/
Marcum llp

 Marcum LLP

 We
have served as the Company's auditor since 2019.

 New
York, NY
April 16, 2024

 iSun,
Inc.

Balance Sheets

31, 2023 and 2022

 (In
thousands, except number of shares)

 2023

 2022

 Current Assets:

 Cash

 $
 3,463

 $
 5,455

 Accounts receivable, net of credit losses of $ 163 and $ 302 respectively

 12,987

 8,783

 Contract assets,

 12,560

 7,324

 Inventory

 1,494

 2,536

 Other current assets

 1,625

 Total current assets

 31,477

 25,723

 Other assets:

 Property and equipment, net of accumulated depreciation

 7,808

 8,440

 Operating lease right-of-use asset, net

 6,318

 6,960

 Captive insurance investment

 Intangible assets, net

 12,439

 14,038

 Investments

 8,000

 12,020

 Other assets

 Total assets

 $
 66,701

 $
 67,481

 Liabilities, Temporary Equity and Stockholders' Equity

 Current Liabilities:

 Accounts payable

 $
 20,532

 $
 12,941

 Accrued expenses

 5,382

 5,868

 Operating lease liability

 Contract liabilities

 7,024

 5,419

 Current portion of deferred compensation

 -

 Current portion of long-term debt

 1,820

 5,374

 Total current liabilities

 35,354

 30,221

 Long-term liabilities:

 Warrant liability

 Operating lease liability, net of current portion

 6,114

 6,711

 Other liabilities

 3,026

 Long-term debt, net of current portion

 7,962

 8,226

 Derivative liability

 3,882

 -

 Total liabilities

 53,581

 48,194

 Commitments and Contingencies (Note 10)

 -

 -

 Temporary Equity:

 Series A Preferred stock – 0.0001 par value; $ 3,000,000 and $ 0 liquidation
value; 300,000 and 0 shares authorized, issued and outstanding as of December 31, 2023 and 2022, respectively

 -

 -

 Stockholders' equity:

 Common stock – 0.0001 par value 49,000,000 shares authorized, 47,317,508 and 15,083,109 issued and outstanding as of December 31, 2023 and 2022, respectively

 Additional paid-in capital

 87,317

 74,070

 Accumulated deficit

 ( 74,202
)

 ( 54,785
)

 Total Stockholders' equity

 13,120

 19,287

 Total liabilities, temporary equity and stockholders' equity

 $
 66,701

 $
 67,481

 The
accompanying notes are an integral part of these consolidated financial statements.

 iSun,
Inc.

Statements of Operations

 For
the Years Ended December 31, 2023 and 2022

 (In
thousands, except number of shares)

 2023

 2022

 Earned revenue

 $

 $

 Cost of earned revenue

 77,767

 60,481

 Income before operating expenses

 17,916

 15,972

 Warehouse and other operating expenses

 1,765

 General and administrative expenses

 21,618

 22,411

 Stock based compensation - general and administrative

 1,079

 2,981

 Impairment of goodwill

 -

 Impairment of investment

 4,020

 -

 Depreciation and amortization

 3,069

 7,071

 Total operating expenses

 30,610

 71,378

 Operating loss

 ( 12,694
)

 ( 55,406
)

 Other income (expense)

 Gain on forgiveness of PPP loan

 -

 2,592

 Change in fair value of warrant liability

 ( 238
)

 Loss on extinguishment of debt

 ( 3,076
)

 -

 Other expense

 ( 500
)

 ( 504
)

 Financing costs

 ( 308
)

 -

 Other financing costs

 ( 863
)

 -

 Interest expense

 ( 1,694
)

 ( 1,351
)

 Loss before income taxes

 ( 19,373
)

 ( 54,531
)

 Income tax expense (benefit)

 ( 752
)

 $
 ( 19,417
)

 $
 ( 53,779
)

 Weighted average shares of common stock outstanding

 Basic and diluted

 26,703,958

 14,089,499

 Basic and diluted

 $
 ( 0.73
)

 $
 ( 3.82
)

 The
accompanying notes are an integral part of these consolidated financial statements.

 iSun,
Inc.

Statements of Changes in Stockholders' Equity

 For
the Years Ended December 31, 2023 and 2022

 (In
thousands, except number of shares)

 Shares

 Amounts

 Capital

 Deficit)

 Total

 Common Stock

 Additional

 Paid-In

 (Accumulated

 Shares

 Amounts

 Capital

 Deficit)

 Total

 Balance as of January 1, 2022

 11,825,878

 $

 $
 60,863

 $
 ( 1,006
)

 $
 59,858

 Issuance under equity incentive plan

 619,300

 -

 3,866

 -

 3,866

 Redemption of Put Agreements

 ( 575,966
)

 -

 ( 5,079
)

 -

 ( 5,079
)

 Sale of Common Stock pursuant to S-3 registration statement

 3,213,897

 14,420

 -

 14,421

 -

 -

 -

 ( 53,779
)

 ( 53,779
)

 Balance as of December 31, 2022

 15,083,109

 $

 $
 74,070

 $
 ( 54,785
)

 $
 19,287

 Balance

 15,083,109

 $

 $
 74,070

 $
 ( 54,785
)

 $
 19,287

 Issuance under equity incentive plan

 621,450

 -

 1,079

 -

 1,079

 Issuance of shares for acquisition of iSun Energy, LLC

 200,000

 -

 -

 -

 -

 Issuance of shares for debt amortization

 6,340,411

 -

 3,825

 -

 3,825

 Proceeds from the sale of Common Stock, net

 21,572,538

 7,713

 -

 7,714

 Issuance of Common Stock in connection with repayment of Anson Loan

 3,500,000

 -

 -

 -

 -

 ( 19,417
)

 ( 19,417
)

 Balance as of, December 31, 2023

 47,317,508

 $

 $
 87,317

 $
 ( 74,202
)

 $
 13,120

 Balance

 47,317,508

 $

 $
 87,317

 $
 ( 74,202
)

 $
 13,120

 The
accompanying notes are an integral part of these consolidated financial statements.

 iSun,
Inc.

Statements of Cash Flows

 For
the Years Ended December 31, 2023 and 2022

 (In
thousands, except number of shares)

 2023

 2022

 Cash flows from operating activities

 $
 ( 19,417
)

 $
 ( 53,779
)

 Adjustments to reconcile net loss to net cash used in operating activities:

 Impairment of goodwill

 -

 Impairment of investment

 4,020

 -

 Depreciation of property and equipment

 1,471

 2,252

 Bad debt expense

 Amortization of intangible assets

 1,599

 4,820

 Amortization of right-of-use asset

 Gain on forgiveness of PPP loan

 -

 ( 2,592
)

 Gain on sale of property and equipment

 ( 36
)

 Change in fair value of warrant liability

 ( 138
)

 Stock based compensation

 1,079

 3,866

 Deferred finance charge amortization

 1,049

 Loss on extinguishment of debt

 3,076

 -

 Deferred income taxes

 -

 ( 772
)

 Changes in operating assets and liabilities:

 Accounts receivable

 ( 4,271
)

 5,409

 Other current assets

 ( 554
)

 Contract assets

 ( 5,236
)

 ( 3,320
)

 Inventory

 1,042

 ( 56
)

 Accounts payable

 7,591

 ( 247
)

 Accrued expenses

 ( 486
)

 ( 1,760
)

 Contract liabilities

 1,605

 3,030

 Other assets

 -

 Other liabilities

 ( 3,005
)

 ( 349
)

 Deferred compensation

 ( 31
)

 ( 28
)

 Operating lease liability

 ( 589
)

 ( 564
)

 Net cash used in operating activities

 ( 8,940
)

 ( 6,318
)

 Cash flows from investing activities:

 Purchase of property and equipment

 ( 616
)

 ( 512
)

 Proceeds from sale of property and equipment

 1,267

 Dividend receivable

 -

 Investment in captive insurance

 ( 359
)

 -

 Net cash (used in) provided by investing activities

 ( 806
)

 1,155

 Cash flows from financing activities:

 Proceeds from line of credit

 -

 20,453

 Payments to line of credit

 -

 ( 24,921
)

 Proceeds from long-term debt

 7,935

 ( 12,500
)

 Payments of deferred finance charges

 -

 ( 1,654
)

 Payments of long-term debt

 ( 7,895
)

 ( 7,344
)

 Proceeds from sales of common stock, net

 7,714

 14,421

 Redemption of Put agreements

 -

 ( 5,079
)

 -

 -

 Net cash provided by financing activities

 7,754

 8,376

 Net (decrease) increase in cash

 ( 1,992
)

 3,213

 Cash, beginning of year

 5,455

 2,242

 Cash, end of year

 $
 3,463

 $
 5,455

 Supplemental disclosure of cash flow information

 Cash paid during the year for:

 Interest

 $
 1,512

 $
 1,351

 Income taxes

 -

 Supplemental schedule of non-cash investing and financing activities:

 Accrued employee incentive compensation settled in stock

 $
 -

 $

 Operating right-of-use lease asset and operating lease liability upon adoption of ASU 2016-02, Leases (Topic 842)

 $
 -

 $

 Vehicles purchased and financed

 $

 $

 Issuance of Series A Preferred Stock in connection with Anson loan repayment

 $
 3,882

 $
 -

 Issuance of Common Stock in connection with Anson loan

 $

 $
 -

 Issuance of shares of Common Stock for repayment of debt

 $
 3,825

 $
 -

 The
accompanying notes are an integral part of these consolidated financial statements.

 iSUN,
INC.

 NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS

 (in
thousands, except share and per share data)

 1.
 SUMMARY OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES

 a)
 Organization

 iSun,
Inc. is a solar energy company providing design, development, engineering, procurement, installation, storage and electric vehicle infrastructure
services for residential, commercial, industrial and utility customers across the United States. The Company also provides electrical
contracting services and data and communication services. The work is performed under fixed-price and modified fixed-price contracts
and time and materials contracts. The Company is incorporated in the State of Delaware and has its corporate headquarters in Williston,
Vermont.

 b)
 Principles of Consolidation

 The
accompanying consolidated financial statements include the accounts of iSun, Inc. and its direct and indirect wholly owned operating
subsidiaries, iSun Residential, Inc., SolarCommunities, Inc., iSun Industrial, LLC, Peck Electric Co., Liberty Electric, Inc., iSun Utility,
LLC, iSun Corporate, LLC and iSun Energy, LLC. All material intercompany transactions have been eliminated upon consolidation of these
entities.

 c)
 Emerging Growth Company Status

 The
Company is an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, (the "Securities
Act"), as modified by the Jumpstart Our Business Startups Act of 2012, (the "JOBS Act"). Section 102(b)(1) of the JOBS
Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private
companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities
registered under the Securities Exchange Act of 1934, as amended) are required to comply with the new or revised financial accounting
standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of
such extended transition period which means that when a standard is issued or revised and it has different application dates for public
or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies
adopt the new or revised standard.

 The
Company would cease to be an "emerging growth company" upon the earliest to occur of: the last day of the fiscal year in
which it has more than $ 1.07 billion in annual revenue; the date it qualifies as a "large accelerated filer," with at least
$ 700 million of equity securities held by non-affiliates; the issuance, in any three-year period, by it of more than $ 1.0 billion in
non-convertible debt or December of 2024.

 d)
 Revenue Recognition

 The
majority of the Company's revenue arrangements generally consist of a single performance obligation to transfer promised goods
or services.

 1)
Revenue Recognition Policy

 Solar
Power Systems Sales and Engineering, Procurement, and Construction Services

 The
Company recognizes revenue from the sale of solar power systems, Engineering, Procurement and Construction ("EPC") services,
and other construction type contracts over time, as performance obligations are satisfied, due to the continuous transfer of control
to the customer. Construction contracts, such as the sale of a solar power system combined with EPC services, are generally accounted
for as a single unit of account (a single performance obligation) and are not segmented between types of services. Our contracts often
require significant services to integrate complex activities and equipment into a single deliverable, and are therefore generally accounted
for as a single performance obligation, even when delivering multiple distinct services. For such services, the Company recognizes revenue
using the cost to cost method, based primarily on contract cost incurred to date compared to total estimated contract cost. The cost
to cost method (an input method) is the most faithful depiction of the Company's performance because it directly measures the value
of the services transferred to the customer. Cost of revenue includes an allocation of indirect costs including depreciation and amortization.
Subcontractor materials, labor and equipment, are included in revenue and cost of revenue when management believes that the Company is
acting as a principal rather than as an agent (i.e., the Company integrates the materials, labor and equipment into the deliverables
promised to the customer). Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are
determined as assessed at the contract level. Pre-contract costs are expensed as incurred unless they are expected to be recovered from
the customer. As of December 31, 2023 and 2022, the Company had $ 0 in pre-contract costs classified as a current asset under contract
assets on the Consolidated Balance Sheet. Project mobilization costs are generally charged to project costs as incurred when they are
an integrated part of the performance obligation being transferred to the client. Customer payments on construction contracts are typically
due within 30 to 45 days of billing, depending on the contract. Sales and other taxes the Company collects concurrent with revenue-producing
activities are excluded from revenue.

 For
sales of solar power systems in which the Company sells a controlling interest in the project to a customer, revenue is recognized for
the consideration received when control of the underlying project is transferred to the customer. Revenue may also be recognized for
the sale of a solar power system after it has been completed due to the timing of when a sales contract has been entered into with the
customer.

 Energy
Generation

from net metering credits is recorded as electricity is generated from the solar arrays and billed to customers (PPA off-taker) at the
price rate stated in the applicable power purchase agreement (PPA).

 Operation
and Maintenance and Other Miscellaneous Services

for time and materials contracts is recognized as the service is provided.

 2)
Disaggregation of Revenue from Contracts with Customers

 The
following table disaggregates the Company's revenue, all recognized over time, based on the timing of satisfaction of performance
obligations for the years ended December 31:

 (In
thousands)

 SCHEDULE OF DISAGGREGATION OF REVENUE

 2023

 2022

 Performance obligations satisfied over time

 Solar

 $
 80,615

 $
 68,936

 Electric

 13,672

 6,354

 Data and Network

 1,396

 1,163

 Totals

 $

 $

 $

 $

 The
following table disaggregates the Company's revenue based operational division for the years ended December 31:

 (In
thousands)

 SCHEDULE OF REVENUE BASED OPERATIONAL SEGMENT

 2023

 2022

 Operations

 $
 33,039

 $
 39,513

 Commercial and Industrial

 61,470

 32,750

 1,174

 4,190

 Totals

 $

 $

 $

 $

 3)
Variable Consideration

 The
nature of the Company's contracts gives rise to several types of variable consideration, including claims and unpriced change orders;
award and incentive fees; and liquidated damages and penalties. The Company recognizes revenue for variable consideration when it is
probable that a significant reversal in the amount of cumulative revenue recognized will not occur. The Company estimates the amount
of revenue to be recognized on variable consideration using the expected value (i.e., the sum of a probability-weighted amount) or the
most likely amount method, whichever is expected to better predict the amount. Factors considered in determining whether revenue associated
with claims (including change orders in dispute and unapproved change orders in regard to both scope and price) should be recognized
include the following: (a) the contract or other evidence provides a legal basis for the claim, (b) additional costs were caused by circumstances
that were unforeseen at the contract date and not the result of deficiencies in the Company's performance, (c) claim-related costs
are identifiable and considered reasonable in view of the work performed, and (d) evidence supporting the claim is objective and verifiable.
If the requirements for recognizing revenue for claims or unapproved change orders are met, revenue is recorded only when the costs associated
with the claims or unapproved change orders have been incurred. Back charges to suppliers or subcontractors are recognized as a reduction
of cost when it is determined that recovery of such cost is probable and the amounts can be reliably estimated. Disputed back charges
are recognized when the same requirements described above for claims accounting have been satisfied.

 4)
Remaining Performance Obligation

 Remaining
performance obligations, or backlog, represents the aggregate amount of the transaction price allocated to the remaining obligations
that the Company has not performed under its customer contracts. The Company has elected to use the optional exemption in ASC 606-10-50-14,
which exempts an entity from such disclosures if a performance obligation is part of a contract with an original expected duration of
one year or less.

 5)
Warranties

 The
Company generally provides limited workmanship warranties up to five years for work performed under its construction contracts. The warranty
periods typically extend for a limited duration following substantial completion of the Company's work on a project. Historically,
warranty claims have not resulted in material costs incurred, and any estimated costs for warranties are included in the individual contract
cost estimates for purposes of accounting for long-term contracts.

 e)
 Cash and Cash Equivalents

 The
Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash
equivalents. Cash and cash equivalents consist of cash on deposit with banks and money market funds. The Company maintains cash in bank
accounts which, at times, may exceed federally insured limits. As part of its cash management process, the Company periodically reviews
the relative credit standing of these banks. The Company has not experienced any losses in such accounts and periodically evaluates the
credit worthiness of the financial institutions and has determined the credit exposure to be negligible. The Company did not have any
cash equivalents as of December 31, 2023.

 e)
 Accounts Receivable

 Accounts
receivable are recorded when invoices are issued and presented on the balance sheet net of the allowance for credit losses. The allowance,
which was $ 163 at December 31, 2023 and $ 302 at December 31, 2022, is estimated based on historical losses, the existing economic condition,
and the financial stability of the Company's customers. Accounts are written off against the reserve when they are determined to
be uncollectible.

 Concentration
of accounts receivable consist of the following:

OF CONCENTRATION
OF ACCOUNTS RECEIVABLE

 December 31, 2023

 December 31, 2022

 Customer A

 %

 %

 Customer B

 %

 %

 Customer C

 %

 %

 Customer D

 %

 %

 Customer E

 %

 %

 Customer F

 %

 %

 Customer G

 %

 %

 Customer H

 %

 %

 Concentration Risk Percentage

 %

 %

 f)
 Contract Assets and Liabilities

 Contract
assets consist of (i) the earned, but unbilled, portion of a project for which payment is deferred by the customer until certain met;
(ii) direct costs, including commissions, labor related costs and permitting fees paid prior to recording revenue, and (iii) unbilled
receivables which represent revenue that has been recognized in advance of billing the customer, which is common for larger construction
contracts. Contract liabilities consist of deferred revenue, customer deposits and customer advances, which represent consideration received
from a customer prior to transferring control of goods or services to the customer under the terms of a contract. Total contract assets
and contract liabilities balances as of the respective dates are as follows:

 SCHEDULE OF CONTRACT ASSET AND LIABILITIES

 2023

 2022

 (In thousands)

 Contract Assets

 $
 12,560

 $
 7,324

 Contract Liabilities

 7,024

 5,419

 Contract
assets are presented net of credit losses, which were immaterial for the years ended December 31, 2023 and 2022.

 Project

 Project
assets primarily consist of costs related to solar power projects that are in various stages of development that are capitalized prior
to the completion of the sale of the project, and are actively marketed and intended to be sold. In contrast to contract assets, the
Company holds a controlling interest in the project itself. These project related costs include costs for land, development, and construction
of a PV solar power system. Development costs may include legal, consulting, permitting, transmission upgrade, interconnection, and other
similar costs. The Company typically classifies project assets as noncurrent due to the nature of solar power projects (long-lived assets)
and the time required to complete all activities to develop, construct, and sell projects, which is typically longer than 12 months.
Once the Company enters into a definitive sales agreement, such project assets are classified as current until the sale is completed
and the Company has met all of the criteria to recognize the sale as revenue. Any income generated by a project while it remains within
project assets is accounted for as a reduction to the basis in the project. If a project is completed and begins commercial operation
prior to the closing of a sales arrangement, the completed project will remain in project assets until placed in service. All expenditures
related to the development and construction of project assets, whether fully or partially owned, are presented as a component of cash
flows from operating activities. Project assets are reviewed for impairment whenever events or changes in circumstances indicate that
the carrying amount may not be recoverable. A project is considered commercially viable or recoverable if it is anticipated to be sold
for a profit once it is either fully developed or fully constructed. A partially developed or partially constructed project is considered
to be commercially viable or recoverable if the anticipated selling price is higher than the carrying value of the related project assets.
The Company examines a number of factors to determine if the project is expected to be recoverable, including whether there are any changes
in environmental, permitting, market pricing, regulatory, or other conditions that may impact the project. Such changes could cause the
costs of the project to increase or the selling price of the project to decrease. If a project is not considered recoverable, we impair
the respective project assets and adjust the carrying value to the estimated fair value, with the resulting impairment recorded within
"Selling, general and administrative" expense.

 Project
Asset were $ 0 for the years ended December 31, 2023 and 2022, respectively.

 g)
 Property and Equipment

 Property
and equipment greater than $ 5 are recorded at cost. Cost includes the price paid to acquire or construct the assets, required installation
costs, and any expenditures that substantially add to the value or substantially extend the useful life of the assets.

 The
solar arrays represent project assets that the Company may temporarily own and operate after being placed into service. The Company reports
solar arrays at cost, less accumulated depreciation. The Company begins depreciation on the solar arrays when they are placed in service.

 Depreciation
is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows:

 SCHEDULE OF ESTIMATED USEFUL LIVES

 Buildings
 and improvements

 years

 Vehicles

 3 - 5
 years

 Tools
 and equipment

 3 - 7
 years

 Solar
 arrays

 years

 Software

 3 - 7
 years

 The
cost of assets sold, retired, or otherwise disposed of, and the related allowance for depreciation are eliminated from the accounts and
any resulting gain or loss is included in operations. The cost of maintenance and repairs are charged to expense as incurred, while significant
renewals or betterments are capitalized.

 h)
 Intangible Assets

 Intangible
assets primarily consist of trademarks, intellectual property and backlog They are amortized ratably over a range of 1
to 10
years. The Company assesses the carrying value of its intangible assets for impairment each year. Based on its assessments, the
Company has not recorded any impairment charges during the years ended December 31, 2023 and 2022, respectively.

 i)
 Goodwill

 The
Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805, "Business Combinations,"
where the total purchase price is allocated to the tangible and identified intangible assets acquired and liabilities assumed based on
their estimated fair values. The purchase price is allocated using the information currently available, and may be adjusted, up to one
year from acquisition date, after obtaining more information regarding, among other things, asset valuations, liabilities assumed and
revisions to preliminary estimates. The purchase price in excess of the fair value of the tangible and identified intangible assets acquired
less liabilities assumed is recognized as goodwill.

 The
Company tests goodwill for potential impairment at least annually, or more frequently if an event or other circumstance indicates that
the Company may not be able to recover the carrying amount of the net assets of the reporting unit. The Company has determined that the
reporting unit is the entire company, due to the integration of all of the Company's activities. In evaluating goodwill for impairment,
the Company may assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that
the fair value of a reporting unit is less than its carrying amount. If the Company bypasses the qualitative assessment, or if the Company
concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then the Company performs
a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount.

 The
Company calculates the estimated fair value of a reporting unit using a weighting of the income and market approaches. For the income
approach, the Company uses internally developed discounted cash flow models that include the following assumptions, among others: projections
of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments
to grow new units; and estimated discount rates. For the market approach, the Company uses internal analyses based primarily on market
comparables. The Company bases these assumptions on its historical data and experience, third party appraisals, industry projections,
micro and macro general economic condition projections, and its expectations. However, due to the decline in Company's market price,
it was determined that it was more likely and not that the Goodwill was fully impaired as of December 31, 2022 and recorded an impairment
of $ 37.2 million, a nonrecurring fair value measurement.

 j)
 Long-Lived Assets

 The
Company assesses long-lived assets, including property and equipment, for impairment whenever events or changes in circumstances arise,
including consideration of technological obsolescence, that may indicate that the carrying amount of such assets may not be recoverable.
These events and changes in circumstances may include a significant decrease in the market price of a long-lived asset; a significant
adverse change in the extent or manner in which a long-lived asset is being used or in its physical condition; a significant adverse
change in the business climate that could affect the value of a long-lived asset; an accumulation of costs significantly in excess of
the amount originally expected for the acquisition or construction of a long-lived asset; a current period operating or cash flow loss
combined with a history of such losses or a projection of future losses associated with the use of a long-lived asset; or a current expectation
that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated
useful life. For purposes of recognition and measurement of an impairment loss, long-lived assets are grouped with other assets and liabilities
at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities.

 When
impairment indicators are present, the Company compares undiscounted future cash flows, including the eventual disposition of the asset
group at market value, to the asset group's carrying value to determine if the asset group is recoverable. If the carrying value
of the asset group exceeds the undiscounted future cash flows, the Company measures any impairment by comparing the fair value of the
asset group to its carrying value. Fair value is generally determined by considering (i) internally developed discounted cash flows for
the asset group, (ii) third-party valuations, and/or (iii) information available regarding the current market value for such assets.

 If
the fair value of an asset group is determined to be less than its carrying value, an impairment in the amount of the difference is recorded
in the period that the impairment indicator occurs. Estimating future cash flows requires significant judgment, and such projections
may vary from the cash flows eventually realized.

 The
Company considers a long-lived asset to be abandoned after the Company has ceased use of such asset and it has no intent to use or repurpose
the asset in the future. Abandoned long-lived assets are recorded at their salvage value, if any.

 k)
 Asset Retirement Obligations

 The
Company develops, constructs, and operates certain solar arrays with land lease agreements that include a requirement for the removal
of the assets at the end of the term of the agreement. The Company recognizes such asset retirement obligations ("ARO") in
the period in which they are incurred based on the present value of estimated third-party recommissioning costs, and it capitalizes the
associated asset retirement costs as part of the carrying amount of the related assets. Once an asset is placed into service, the asset
retirement cost is subsequently depreciated on a straight-line basis over the estimated useful life of the asset. Changes in AROs resulting
from the passage of time are recognized as an increase in the carrying amount of the liability and as accretion expense. The AROs were
not deemed material to the financial statements and as a result a liability was not recorded at December 31, 2023 and 2022.

 l)
 Concentration and Credit Risks

 The
Company occasionally has cash balances in a single financial institution during the year in excess of the Federal Deposit Insurance Corporation
(FDIC) limit of up to $ 250 per financial institution. The differences between book and bank balances are outstanding checks and deposits
in transit. At December 31, 2023 and 2022, the uninsured balances were approximately $ 1,895 and $ 3,300, respectively.

 m)
 Income Taxes

 The
Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and
their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to be applied to taxable
income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and
liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense
represents the change during the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a
valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets
will not be realized. The financial statements of the Company account for deferred tax assets and liabilities in accordance with Accounting
Standards Codification ("ASC") 740, Income taxes.

 The
Company also uses a more-likely-than-not measurement for all tax positions taken or expected to be taken on a tax return in order for
those tax positions to be recognized in the financial statements. If the Company were to incur interest and penalties related to income
taxes, these would be included in the provision for income taxes. Generally, the three tax years previously filed remain subject to examination
by federal and state tax authorities.

 n) Preferred Stock

 The
Company applies the accounting standards for distinguishing liabilities from equity when determining the classification and
measurement of its preferred stock. Preferred shares subject to mandatory redemption are classified as liability instruments and are
measured at fair value. Conditionally redeemable preferred shares (including preferred shares that feature redemption rights that
are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the
Company's control) are classified as temporary equity. At all other times, preferred shares are classified as
stockholders' equity.

 o)
 Sales Tax

 The
Company's accounting policy is to exclude state sales tax collected and remitted from revenues and costs of sales, respectively.

 p)
 Use of Estimates

 The
preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities
at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates
include estimates used to review the Company's impairment analysis of its intangible assets, impairment on investment, the valuation of the Company's Series A Preferred Stock using the Monte Carlo simulation and revenue
recognition utilizing a cost-to-cost method. The Company bases its estimates on historical experience and on various other assumptions
that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying
values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under
different assumptions or conditions.

 q)
 Recently Issued Accounting Pronouncements

 The
Company is an emerging growth company until at minimum December 31, 2024. The Company will maintain the election available to an emerging
growth company to use any extended transition period applicable to non-public companies when complying with a new or revised accounting
standard. The Company retains its emerging growth status and therefore elects to adopt new or revised accounting standards on the adoption
date required for a private company.

 In
March 2023, the FASB issued ASU No. 2014-01, Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments
in Qualified Affordable Housing Projects, which amended Subtopic 323-740, Investments—Equity Method and Joint Ventures—Income
Taxes, introduced the option to apply the proportional amortization method to account for investments made primarily for the purpose
of receiving income tax credits and other income tax benefits when certain requirements are met. This guidance is effective for fiscal
years beginning after December 15, 2023 with early adoption permitted. The Company adopted ASU 2014-01 on January 1, 2023. The adoption
of ASU 2014-01 did not have a material impact on the Company's financial position, results of operations or cash flows.

 In
June 2016, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2016-13 "Financial
Instruments - Credit Losses (Topic 326)" and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04
and ASU 2019-05 (collectively Topic 326). Topic 326 requires the measurement and recognition of expected credit losses for financial
assets held at amortized cost. This replaces the existing incurred loss model with an expected loss model and requires the use of forward-looking
information to calculate credit loss estimates. The Company adopted ASU 2016-13 on January 1, 2023. The adoption of ASU 2016-13 did not
have a material impact on the Company's financial position, results of operations or cash flows.

 On
November 27, 2023, FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures",
which requires public entities to consider relevant qualitative and quantitative factors when determining whether segment expense categories
and amounts are significant, and identify segment expenses on the basis of amounts that are regularly provided to the chief operating
decision maker (CODM), and included in reported segment profit or loss. The ASU is effective for fiscal years beginning after December
15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company is currently evaluating the effect that
adopting this new accounting guidance will have on its consolidated financial statements and related disclosures.

 On
December 14, 2023, the FASB issued ASU 2023-09 which establishes new income tax disclosure requirements in addition to modifying and
eliminating certain existing requirements. Under the new guidance, entities must consistently categorize and provide greater disaggregation
of information in the rate reconciliation. The Company is currently evaluating the effect that adopting this new accounting guidance
will have on its consolidated financial statements and related disclosures.

 r)
 Deferred Finance Costs

 Deferred
financing costs relate to the Company's debt and equity instruments. Deferred financing costs relating to debt instruments are
amortized over the terms of the related instrument using the effective interest method. The Company incurred $ 308 and $ 0 of deferred
financing costs during the years ended December 31, 2023 and 2022, respectively. Amortization expense associated with deferred financing
costs, which is included in interest expense, totaled $ 1,049 and $ 413 for the years ended December 31, 2023 and 2022, respectively.

 s)
 Fair Value of Financial Instruments

 The
Company's financial instruments include cash, accounts receivable, cash collateral deposited with insurance
carriers, deferred compensation plan liabilities, accounts payable and other current liabilities, and debt obligations.

 Fair
value is the price that would be received to sell an asset or the amount paid to transfer a liability (an exit price) in the principal
or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
The fair value guidance establishes a valuation hierarchy, which requires maximizing the use of observable inputs when measuring fair
value. The three levels of inputs that may be used are: (i) Level 1 - quoted market prices in active markets for identical assets or
liabilities; (ii) Level 2 - observable market-based inputs or other observable inputs; and (iii) Level 3 - significant unobservable inputs
that cannot be corroborated by observable market data, which are generally determined using valuation models incorporating management
estimates of market participant assumptions. In instances in which the inputs used to measure fair value fall into different levels of
the fair value hierarchy, the fair value measurement classification is determined based on the lowest level input that is significant
to the fair value measurement in its entirety. Management's assessment of the significance of a particular item to the fair value
measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

 Fair
values of financial instruments are estimated using public market prices, quotes from financial institutions and other available information.
Due to their short-term maturity, the carrying amounts of cash, accounts receivable, accounts payable and other current liabilities approximate
their fair values. Management believes the carrying values of notes and other receivables, cash collateral deposited with insurance carriers,
and outstanding balances on its line of credit and long-term debt approximate their fair values as these amounts are estimated using
public market prices, quotes from financial institutions and other available information.

 t)
 Debt Extinguishment

 Under
ASC 470, debt should be derecognized when the debt is extinguished, in accordance with the guidance in ASC 405-20, Liabilities:
Extinguishments of Liabilities. Under this guidance, debt is extinguished when the debt is paid, or the debtor is legally
released from being the primary obligor by the creditor. On January 21, 2022, SunCommon received notification from Citizens Bank
N.A. that the Small Business Administration has approved the forgiveness of the PPP loan in its entirety and as such, the full
$ 2,592
has been recognized in the income statement as a gain upon debt extinguishment for the year ended December 31, 2022. On December 12,
2023, the Company entered into an agreement with Anson Investments Master Fund LP and Anson East Master Fund LP (together, the
"Investors") pursuant to which the Company redeemed all amounts due under those certain Senior Secured Convertible
Promissory Notes issued to the Investors. The loss on the debt extinguishment of $ 3.1
million has been recognized in the statement of operations for the year ended December 31, 2023.

 u)
 Inventory

 Inventory
is valued at lower of cost or net realizable value determined by the first-in, first-out method. Inventory primarily consists of solar
panels and other materials. The Company reviews the cost of inventories against their estimated net realizable value and records write-downs
if any inventories have costs in excess of their net realizable values. No inventory allowance exists at December 31, 2023 and December
31, 2022, respectively.

 v)
 Warrant liability

 The
Company accounts for warrants to acquire shares of Common Stock as liabilities held at fair value on the consolidated balance sheets.
The warrants are subject to remeasurement at each balance sheet date and any change in fair value is recognized as a change in fair value
of warrant liabilities in the Company's consolidated statements of operations. The Company will continue to adjust the liability
for changes in fair value until the earlier of the exercise or expiration of the warrants. At that time, the warrant liability will be
reclassified to additional paid-in capital.

 w)
 Segment Information

 Operating
segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by
the chief operating decision maker, or decision-making group, in deciding the method to allocate resources and assess performance.
The Company currently has two
reportable segments with different product offerings for financial reporting purposes, which represents the Company's core
business (see note 6).

 x)
 Legal Contingencies

 The
Company accounts for liabilities resulting from legal proceedings when it is possible to evaluate the likelihood of an unfavorable outcome
in order to provide an estimate for the contingent liability. At December 31, 2023 and 2022, there are no material contingent liabilities
arising from pending litigation.

 y)
 Sequencing Policy

 On December 12,
2023, as a result of entering into a Letter Agreement with Certain Investors (see Note 7) which resulted in the issuance of common
stock and Series A Convertible Preferred Stock, the Company adopted a sequencing policy in accordance with ASC 815-40-35-12 whereby
all instruments issued subsequent to that date, the Company's Series A Convertible Preferred Stock and warrants will be
classified as a derivative liability. If an additional offering occurs in the future, the Company will evaluate
instruments issued prior to December 12, 2023 as to whether such instruments would result in a classification modification and determine
what the respective accounting treatment would occur at such time.

 3.
 LIQUIDITY AND GOING CONCERN

 As of December
31, 2023, the Company had a working capital deficiency of $ 3.9 million. During the years ended December 31, 2023 and 2022, the Company
incurred net losses of $ 19.4 million
and $ 53.8 million,
respectively, and used cash in operations of $ 8.9
 million and $ 6.3
 million, respectfully. The Company has historically incurred operating losses and
may continue to incur operating losses for the foreseeable future. These conditions raise substantial doubt about our ability to continue
as a going concern for at least one year from the date these financial statements are issued. This may hinder the Company's future
ability to obtain new financing or may force us to obtain financing on less favorable terms than would otherwise be available. The Company's
plans include continued efforts to raise additional capital through debt and equity financings. There is no assurance that these funds
will be sufficient to enable the Company to achieve profitable operations. If the Company is unable to obtain such additional financing
on a timely basis it may have a material adverse effect on it's business, financial condition and results of operations, and ultimately
the Company could be forced to discontinue our operations and liquidate.

 The accompanying consolidated financial statements have been
prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP"), which
contemplate continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal
course of business. The carrying amounts of assets and liabilities presented in the financial statements do not necessarily purport to
represent realizable or settlement values. The consolidated financial statements do not include any adjustment that might result from
the outcome of this uncertainty.

 4.
 ACCOUNTS RECEIVABLE

 Accounts
receivable consist of:

 SCHEDULE OF ACCOUNTS RECEIVABLE

 2023

 2022

 Accounts receivable - contracts in progress

 $
 13,892

 $
 8,502

 Accounts receivable - retainage

 ( 742
)

 Accounts receivable

 13,150

 9,085

 Allowance for credit losses

 ( 163
)

 ( 302
)

 Total

 $
 12,987

 $
 8,783

 Bad
debt expense was $ 67 and $ 145 for the years ended December 31, 2023 and 2022, respectively.

 Contract
assets represent revenue recognized in excess of amounts billed, unbilled receivables, and retainage. Unbilled receivables represent
an unconditional right to payment subject only to the passage of time, which are reclassified to accounts receivable when they are billed
under the terms of the contract. Contract assets were as follows at December 31, 2023 and 2022:

 SCHEDULE OF CONTRACT ASSETS AND LIABILITIES

 2023

 2022

 Contract assets

 $
 11,300

 $
 7,231

 Unbilled receivables, included in costs in excess of billings

 ( 490
)

 Costs and estimated earnings
 in excess of billings

 11,818

 6,741

 Retainage, included in Accounts Receivable

 Total

 $
 12,560

 $
 7,324

 Contract
liabilities represent amounts billed to clients in excess of revenue recognized to date, billings in excess of costs, and retainage.
The Company anticipates that substantially all incurred costs associated with contract assets as of December 31, 2023 will be billed
and collected within one year. Contract liabilities were as follows at December 31, 2023 and 2022:

 2023

 2022

 Contract Liabilities

 $
 7,024

 $
 5,419

 Retainage

 -

 -

 Total

 $
 7,024

 $
 5,419

 5.
 CONTRACTS IN PROGRESS

 Information
with respect to contracts in progress are as follows:

 SCHEDULE OF CONTRACTS IN PROGRESS

 2023

 2022

 Expenditures to date on uncompleted contracts

 $
 56,642

 $
 31,215

 Estimated earnings thereon

 2,029

 2,509

 Contract costs

 58,671

 33,724

 Less billings to date

 ( 53,654
)

 ( 31,912
)

 Contract costs, net of billings

 5,017

 1,812

 Plus under billings remaining on contracts 100% complete

 Total

 $
 5,536

 $
 1,905

 Included
in accompany balance sheets under the following captions:

 2022

 2021

 Contract assets

 $
 12,560

 $
 7,324

 Contract liabilities

 ( 7,024
)

 ( 5,419
)

 Total

 $
 5,536

 $
 1,905

 6.
 PROPERTY AND EQUIPMENT

 Information
with respect to property and equipment are as follows:

OF PROPERTY AND EQUIPMENT

 2023

 2022

 Building and improvements

 $

 $

 Vehicles

 4,196

 3,824

 Tools and equipment

 2,551

 2,152

 Software

 Solar arrays

 6,562

 6,708

 Property plant and equipment gross

 6,562

 6,708

 Less accumulated depreciation

 ( 6,311
)

 ( 5,035
)

 Property plant and equipment,
 net

 $
 7,808

 $
 8,440

 Total
depreciation expense for the years ended December 31, 2023 and 2022 was $ 1,471 and $ 2,252, respectively.

 7.
 OPERATING SEGMENTS

 Beginning
in 2023, in conjunction with the implementation of a new ERP system, the Company assessed its operating segment disclosure based on
ASC 280, Segment Reporting, guidance. As determined by ASC 280, Segment Reporting, the Company determined that it has
more than one reportable segment for which financial information is available and regularly evaluated by the chief operating
decision maker, or decision-making group, in deciding the method to allocate resources and assess performance. As a result, the
following segments were established: Residential, Commercial and Industrial, Utility and Corporate.

 Through
its SunCommon operating subsidiary, the Company designs, arranges financing, integrates, installs, and manages systems, primarily for
residential homeowners. The Company sells residential solar systems through its direct sales and marketing channel strategy. The Company
operates in the New York and Vermont residential markets. It has direct sales and/or operations personnel in New York and Vermont.

and Industrial

 Through
our iSun Industrial subsidiary, the Company designs, integrates, installs, and manages systems ranging in size from 50kW (kilowatt) to
multi-MW (megawatt) systems primarily for larger commercial and industrial projects. Commercial installations have included installations
at office buildings, manufacturing plants, warehouses, service stations, churches, and other consumer facing businesses. Industrial installations
have included school districts, local municipalities, federal facilities, higher education institutions as well as green and brown fields.
It has operations personnel in New York, New Hampshire, Maine and Vermont.

 Through
its iSun Utility subsidiary, the Company develops, designs, engineers, arranges financing, installs, and manages systems ranging in size
from 500 kW (kilowatt) to multi-MW (megawatt) systems primarily for asset owners, business and municipalities. The Utility segment is
originating projects in Vermont, North Carolina, South Carolina, Ohio, California, Georgia, Alabama and Colorado. It has operations personnel
in Vermont and Pennsylvania.

 Segment
net revenue, segment operating expenses and segment contribution (loss) information consisted of the following for years ended December
31, 2023 and 2022.

 SCHEDULE OF SEGMENT NET REVENUE

 and
 Industrial

 Total

 Year ended December 31, 2023

 and
 Industrial

 Total

 Net revenue

 $
 33,039

 $
 61,470

 $
 1,174

 $
 -

 $

 Cost of earned revenue

 23,631

 52,667

 1,469

 -

 77,767

 Income (loss) before operating expenses

 9,408

 8,803

 ( 295
)

 -

 17,916

 Operating expenses

 Warehousing and other operating expenses

 -

 -

 -

 Impairment of investment

 -

 -

 -

 4,020

 4,020

 General and administrative expenses

 10,453

 5,180

 1,027

 4,958

 21,618

 Segment (loss) gain

 ( 1,045
)

 2,799

 ( 1,322
)

 ( 8,978
)

 ( 8,546
)

 Stock based compensation – general and administrative

 -

 -

 -

 1,079

 1,079

 Depreciation and amortization

 1,978

 1,091

 -

 -

 3,069

 Operating (loss) gain

 $
 ( 3,023
)

 $
 1,708

 $
 ( 1,322
)

 ( 10,057
)

 $
 ( 12,694
)

 and
 Industrial

 Total

 Year ended December 31, 2022

 and
 Industrial

 Total

 Net revenue

 $
 39,513

 $
 32,746

 $
 4,194

 $
 -

 $

 Cost of earned revenue

 29,834

 28,457

 2,190

 -

 60,481

 Income before operating expenses

 9,679

 4,289

 2,004

 -

 15,972

 Income (loss) before operating expenses

 9,679

 4,289

 2,004

 -

 15,972

 Operating expenses

 Warehousing and other operating expenses

 -

 1,765

 -

 -

 1,765

 Impairment of goodwill

 -

 -

 -

 General and administrative expenses

 13,471

 4,679

 1,394

 2,867

 22,411

 Segment contribution (loss)

 ( 3,792
)

 ( 2,155
)

 ( 40,017
)

 ( 45,354
)

 Stock based compensation – general and administrative

 -

 -

 -

 2,981

 2,981

 Depreciation and amortization

 6,017

 1,054

 -

 -

 7,071

 Operating (loss) income

 $
 ( 9,809
)

 $
 ( 3,209
)

 $

 ( 42,998
)

 $
 ( 55,406
)

by operating segment are as follows:

 2023

 2022

 $
 19,631

 23,685

 Commercial and Industrial

 45,201

 41,831

 1,284

 $
 66,701

 67,481

 8.
 LEASES

 The company follows guidance of ASU 842, Accounting for Leases, where the company recognizes a right-of-use asset
and lease liability, at present value of future lease payments, for leases that are either classified as an operating or financing lease
under the guidance. The Company considers leases of 12 months or less as short-term leases and does not record a right-of-use asset or lease liability
for such leases. The
Company has operating leases for offices, warehouse, vehicles, office equipment and land leases for its solar assets. The Company's
leases have remaining lease terms of 1 year to 18 years, some of which include options to extend.

 The
Company's lease expense for the year ended December 31, 2023 was entirely comprised of operating leases as disclosed below.

OF LEASE EXPENSE

 2023

 2022

 Lease cost

 Operating lease cost

 $

 $
 1,029

 Total lease cost

 $

 $
 1,029

 Right of use asset, net

 $
 6,318

 $
 6,960

 Other information

 Cash paid for amounts included in the measurement of lease liabilities

 Operating cash flows from operating leases

 $
 ( 816
)

 $
 ( 834
)

 Weighted average remaining lease term – operating leases

 10.12

 10.94

 Weighted average discount rate – operating leases

 3.33
 %

 3.33
 %

 Estimated
minimum future lease obligations are as follows:

 SCHEDULE OF ESTIMATED FUTURE MINIMUM LEASE

 Year ending December 31:

 Amount

 2024

 $

 2025

 2026

 2027

 2028

 Thereafter

 4,084

 Total lease payments

 8,082

 Less: interest

 ( 1,372
)

 Total
 operating leases liability

 6,710

 operating
 leases liability Current

 operating
 leases liability Non Current

 $
 6,114

 9.
 LONG-TERM DEBT

 A
summary of long-term debt is as follows:

 SUMMARY OF LONG-TERM DEBT

 2023

 2022

 NBT Bank, National Association, 4.25% interest rate, secured by all business assets, payable in monthly installments of $5,869 through September 2026, with a balloon payment at maturity.

 $

 $

 NBT Bank, National Association, 4.25 % interest rate, secured by certain business assets, payable in monthly installments of $ 5,869 through September 2026, with a balloon payment at maturity.

 NBT Bank, National Association, 4.15 % interest rate, secured by certain business assets, payable in monthly installments of $ 3,677 through April 2026.

 NBT Bank, National Association, 4.20 % interest rate, secured by certain business assets, payable in monthly installments of $ 5,598 through October 2026, with a balloon payment at maturity.

 NBT Bank, National Association, 4.85 % interest rate, secured by a piece of equipment, payable in monthly installments of $ 2,932, repaid in May 2023.

 -

 Various vehicle loans, interest ranging from 0 % to 10.09 %, total current monthly installments of approximately $ 34,878 secured by vehicles, with varying terms through 2027.

 1,233

 1,271

 National Bank of Middlebury, 3.95 % interest rate for the initial 5 years, after which the loan rate will adjust equal to the Federal Home Loan Bank of Boston 5 / 10 – year Advance Rate plus 2.75 %, loan is subject to a floor rate of 3.95 %, secured by solar panels and related equipment, payable in monthly installments of $ 2,388 including interest, through December 2024.

 -

 Senior secured convertible notes payable, 5 % interest rate, monthly payments of 1/26 th of the original purchase amount plus accrued but unpaid interest beginning March 1, 2023 until maturity date of May 4, 2025. (See letter agreement with certain investors below)

 12,500

 Revenue loan with 48 month amortization period secured by all assets of the Company, no conversion provisions.

 8,000

 -

 CSA 36: Payable in monthly installments of $ 2,414, including interest at 5.5 %. The interest rate will become variable at the VEDA Prime Rate from June 2025 through maturity in June 2027.

 CSA 36: Payable in monthly interest only installments of $ 1,104 through June 2020; then payments of $ 552, representing half of monthly interest only payments, through June 2027 with other half of interest only payments capitalized into principal; then $ 2,485 monthly payments of principal and interest, with a balloon payment of $ 20,142 due June 2035; interest at 11.25 % throughout the loan term.

 Equipment loans

 Long-term debit

 10,385

 15,155

 Less current portion

 ( 1,820
)

 ( 5,374
)

 Long-term debt, including
 debt issuance costs

 8,565

 9,781

 Less debt issuance costs

 ( 603
)

 ( 1,555
)

 Long-term debt

 $
 7,962

 $
 8,226

 Maturities
of long-term debt are as follows:

 SCHEDULE OF MATURITIES OF LONG-TERM DEBT

 Year ending December 31:

 Amount

 2024

 $
 1,821

 2025

 2,043

 2026

 2,423

 2027

 3,898

 2028

 Thereafter

 Total

 $
 10,385

 Decathlon
Specialty Finance Revenue Loan

 On
December 12, 2023, the Company and its Subsidiaries entered into a Revenue Loan and Security Agreement (the "Loan Agreement")
with Decathlon Specialty Finance, LLC providing for a loan facility for the Company in the maximum amount of $ 8.0 million.

 The
Loan Agreement requires monthly payments in a fixed amount of $ 165 for the period from January 1, 2024 through December 31, 2024, and
$ 225 for the period from January 1, 2025 through December 5, 2027, at which time all remaining principal and accrued interest will come
due. The loaned amount will bear interest at a rate necessary to generate "Minimum Interest" as that term is defined in the
Loan Agreement, which is between 0.25 times the advanced amount and 0.65 the advanced amount depending on the number of months elapsed
following the effective date of the Loan Agreement. The minimum amount of interest to be received over the loan term is $ 5.2 million.
The amount is determined by the difference between the total payments required of $ 13.2 million and the total amount of the advance of
$ 8.0 million. Using this data long with the payment dates, the Company calculated an imputed interest rate for the loan at approximately
 16.25 %. In using the imputed interest rate, the Company noted the present value of future payments is not materially different than the
cash proceeds received; therefore, the Company will record the proceeds received as the carrying value of the loan. On an at least quarterly
basis, the Company will calculate the present value of lease payments to determine the fair value of the outstanding RSLA balance.
Additionally, the Company will update the estimated future revenues as more data becomes available. The Company will use the prospective
method to adjust the imputed interest rate and recognize interest adjustments prospectively. The advances are secured by all property
of the Borrower and is guaranteed by the Company and certain of the Company's Subsidiaries.

 Letter
Agreement with Certain Investors

 On
December 12, 2023, iSun, Inc., a Delaware corporation (the "Company"), entered into a Letter Agreement (the
"Letter Agreement") by and between the Company and each of Anson Investments Master Fund LP and Anson East Master Fund
LP (together, the "Investors") pursuant to which the Company redeemed all amounts due under those certain Senior Secured
Convertible Promissory Notes issued to the Investors, dated November 4, 2022 (the "Notes"). Pursuant to the Letter
Agreement, the Company made cash payments to the Investors in the aggregate amount of $ 6,000 and
issued an aggregate amount of 3,500,000 shares
of the Company's Common Stock, par value $ 0.0001 per
share ("Common Stock") adding a total of $ 632 to
stockholders' equity to the Investors and 300,000 shares
of the Company's Series A Convertible Redeemable Preferred Stock, par value $ 0.0001 per
share ("Preferred Stock") to the Investors in a private placement transaction resulting in a $ 3,882 addition
to derivative liabilities due to the Company not having enough authorized shares in the event of a full redemption. The Company
evaluated the impact of ASU 470 and determined that the new debt and the fair value of the preferred stock and common stock issued did exceed the 10% test and therefore should be treated as a loss of debt extinguishment. For the year end
December 31, 2023, a loss on debt extinguishment of $ 3.1 million
was included in the statement of operations.

 Cash
Advance Funding

 In
September 2023, the Company agreed to two cash advance funding agreements totaling $ 1,500. At December 31, 2023, the amount of $ 600 is
included in accrued expenses as a current liability.

 10.
 COMMITMENTS AND CONTINGENCIES

 On January 27, 2022, the Company became aware of pending litigation in the U.S. District Court for the District of
Vermont, entitled Sassoon Peress and Renewz Sustainable Solutions, Inc. v. iSun, Inc., alleging various claims including breach of contract,
defamation, and unjust enrichment arising out of the acquisition of iSun Energy, LLC, the sole owner of which was Mr. Peress. The litigation
seeks legal and equitable remedies. The Company was granted an extension of time to plead to Plaintiffs' Amended Complaint until
April 29, 2022. On January 17, 2023, the Company entered into a settlement agreement effectively resolving all claims with no additional
consideration paid as a result of settlement.

 On
February 13, 2024, the Company became aware of pending litigation in the U.S. District Court for the District of Vermont, entitled Duane
Peterson, James more and Jeffrey Irish, solely in their capacity as Shareholder Representative Group v. iSun Inc., alleging breach of
contract/collection. iSun Inc.'s responsive pleading was made on March 15, 2024. iSun, Inc. plans to vigorously contest this litigation.
At this stage it is not possible to evaluate the likelihood of an unfavorable outcome or provide an estimate of the range of potential
loss.

 On
January 2, 2024, the Company became aware of pending litigation in the U.S. District Court for the District of North Carolina,
entitled Alpha Engineering Services, P.A. d/b/a Alpha Environmental v. iSun Corporate, LLC, alleging breach of contract and a second
alternative claim for relief in Quantum Meruit. The Company filed a responsive pleading by March 20, 2024. The
Company's responses to the first set of interrogatories and request for production of documents is currently due April
15 th. iSun Corporate, LLC. plans to vigorously contest this litigation. At this stage it is not possible to evaluate the
likelihood of an unfavorable outcome or provide an estimate of the range of potential loss.

 11. WARRANTS

the year ended December 31, 2023, 1,000,000 warrants to acquire shares of Common Stock were granted. The warrants were issued on August
30, 2023 resulting from a failure to fulfill the EBITDA financial covenant of the Senior Secured Notes. The warrants were issued to the
Investor in order to waive the Event of Default. The Company issued warrants to acquire
an aggregate of 1,000,000 shares of Common Stock with an exercise price of $ 1.00 per share and a term of 5 years.
 During the year ended December 31, 2023, no warrants to acquire shares of Common Stock
were exercised or redeemed. At December 31, 2023, 1,069,144 private warrants to acquire shares of Common Stock that were outstanding
at the time of the Company became a public company remain outstanding.

OF WARRANTS ACQUIRED

 2023

 2022

 Beginning balance

 69,144

 69,144

 Granted

 1,000,000

 -

 Exercised

 -

 -

 Redeemed

 -

 Ending balance

 1,069,144

 69,144

 12.
 FAIR VALUE MEASUREMENTS

 The
Public Warrants were traded under the symbol ISUNW and the fair values were based upon the closing price of the Public Warrants at each
measurement date. The Private Warrants were valued using a Black-Scholes model, pursuant to the inputs provided in the table below:

 SCHEDULE OF FAIR VALUE MEASUREMENT INPUTS

 Input

 Mark-to-Market
 Measurement at
 December 31, 2023

 Mark-to-Market
 Measurement at
 December 31, 2022

 Risk-free rate

 3.88
 %

 3.88
 %

 Remaining term in years

 0.47 - 4.66

 1.47

 Expected volatility

 139.50
 %

 147.02
 %

 Exercise price

 $
 1 - 11.50

 $
 11.50

 Fair value of common stock

 $
 0.22

 $
 1.30

 The
following table sets forth the Company's assets and liabilities which are measured at fair value on a recurring basis by level
within the fair value hierarchy:

 SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS

 Fair Value Measurement as of
 December 31, 2023

 Total

 Level 1

 Level 2

 Level 3

 Liabilities:

 Series A Convertible Preferred Stock

 3,882

 -

 -

 3,882

 Private Warrants

 -

 -

 Fair Value Measurement as of
 December 31, 2022

 Total

 Level 1

 Level 2

 Level 3

 Liabilities:

 Private Warrants

 -

 -

 The
following is a roll forward of the Company's Level 3 instruments:

 SCHEDULE OF ROLL FORWARD OF LEVEL 3 INSTRUMENTS

 2023

 2022

 Beginning balance

 $

 $

 Series A Convertible Preferred Stock

 3,882

 -

 Fair value adjustment – Warrant liability

 ( 138
)

 Ending balance

 $
 4,130

 $

and Liabilities Not Measured at Fair Value on a Recurring Basis

 In
addition to assets and liabilities that are measured at fair value on a recurring basis, the Company also measures certain assets and
liabilities at fair value on a nonrecurring basis. Our non-financial assets, including goodwill, intangible assets, investments, operating
lease right of use assets, and property, plant and equipment, are measured at fair value when there is an indication of impairment and
the carrying amount exceeds the asset's projected undiscounted cash flows. These assets are recorded at fair value only when an
impairment charge is recognized.

 As
of December 31, 2023 and 2022, the fair values of cash, accounts receivable, contract assets, other current assets, accounts payable,
contract liabilities, and accrued expenses approximated their carrying values because of the short-term nature of these instruments.

 For the year ended December 31, 2023, the Company determined there were indicators that would cause a 100 % impairment
of the GSI and SPP investments due to the fair
value of the investments remaining at a level below its cost. The Company therefore recorded an impairment expense of $ 4.0 million for its investments in GSI and SPP during the year ended December 31, 2023, as reflected in the accompanying consolidated
statements of operations.

the year ended December 31, 2022, the Company calculated the estimated fair value of a reporting unit using a weighting of the income
and market approaches. For the income approach, the Company uses internally developed discounted cash flow models that include the following
assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand
trends; expected future investments to grow new units; and estimated discount rates. For the market approach, the Company used internal
analyses based primarily on market comparables. The Company based these assumptions on its historical data and experience, third party
appraisals, industry projections, micro and macro general economic condition projections, and its expectations. However, due to the decline
in Company's market price, it was determined that it was more likely and not that the Goodwill was fully impaired as of December
31, 2022 and recorded an impairment of $ 37.2 million, a nonrecurring fair value measurement.

 13.
 UNION ASSESSMENTS

 The
Company employs members of the International Brotherhood of Electrical Workers Local 300 (IBEW). The union fee assessments payable are
both withholdings from employees and employer assessments. Union fees are for monthly dues, defined contribution pension, health and
welfare funds as part of multi-employer plans. All union assessments are based on the number of hours worked or a percentage of gross
wages as stipulated in the agreement with the Union.

 The
Company has an agreement with the IBEW in respect to rates of pay, hours, benefits, and other employment conditions that expires May
31, 2025. During the years ended December 31, 2023 and 2022, the Company incurred the following union assessments (in thousands):

OF UNION ASSESSMENTS

 2023

 2022

 Pension fund

 $

 $

 Welfare fund

 1,602

 1,120

 National employees benefit fund

 Joint apprenticeship and training committee

 401(k) matching

 Total

 $
 2,744

 $
 1,785

 Multiemployer
Plans

 The
Company is party to collective bargaining agreements with unions representing certain of their employees, which require the Company to
pay specified wages, provide certain benefits to their union employees and contribute certain amounts to Multi-Employer Pension Plans
("MEPP"). The Pension Plan Agreement ("PPA") defines the funding rules for defined benefit pension plans and
establishes funding classifications for U.S.-registered multiemployer pension plans. Under the PPA, plans are classified into one of
the following five categories, based on multiple factors, also referred to as a plan's "zone status": Green (safe),
Yellow (endangered), Orange (seriously endangered), and Red (critical or critical and declining). Factors included in the determination
of a plan's zone status include: funded percentage, cash flow position and whether the plan is projecting a minimum funding deficiency.

 A
multiemployer plan that is so underfunded as to be in "endangered," "seriously endangered," "critical,"
or "critical and declining" status (as determined under the PPA) is required to adopt a funding improvement plan ("FIP")
or a rehabilitation plan ("RP"), which, among other actions, could include decreased benefits and increased employer contributions,
which could take the form of a surcharge on benefit contributions. These actions are intended to improve their funding status over a
period of years. If a pension fund is in critical status, a participating employer must pay an automatic surcharge in addition to contributions
otherwise required under the collective bargaining agreement ("CBA"). With some exceptions, the surcharge is equal to 5%
of required contributions for the initial critical year and 10% for each succeeding plan year in which the plan remains in critical status.
The surcharge ceases on the effective date of a CBA (or other agreement) that includes contribution and benefit terms consistent with
the rehabilitation plan. Certain plans in which the Company participates are in "endangered," "seriously endangered,"
"critical," or "critical and declining" status. The amount of additional funds, if any, that the Company may
be obligated to contribute to these plans in the future cannot be estimated due to the uncertainty of the future levels of work that
could be required of the union employees covered by these plans, as well as the required future contribution rates and possible surcharges
applicable to these plans.

 Details
of significant multiemployer pension plans as of and for the periods indicated, based upon information available to the Company from
plan administrators as well as publicly available information on the U.S. Department of Labor website, are provided in the following
table:

OF MULTIEMPLOYER PLANS

 Multiemployer

 Employer
 Identification

 Plan

 Contributions
 For the Years

 Ended

 Expiration
 Date of

 Pension Protection Act Zone Status

 FIP/RP

 Pension Plan

 Number

 Number

 2023

 2022

 CBA

 2023

 As of

 2022

 As of

 Status

 Surcharge

 National Electrical Benefit Fund

 53-0181657

 99,907

 91,180

 5/31/2023

 Green

 12/31/2022

 Green

 12/31/2021

 NA

 No

 14. RELATED PARTY TRANSACTIONS

 In
January 2022, two former shareholders of SolarCommunities, Inc. lent proceeds to SolarCommunities, Inc to support the subsidiary's
working capital. At December 31, 2023, the amount of $ 933 is included in accrued expenses as a current liability. The unsecured amount
due is not subject to a repayment schedule.

 15.
 INCOME TAXES

 The
provision for income taxes for the years ended December 31, 2023 and 2022 consists of the following:

OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT)

 2023

 2022

 Current

 Federal

 $
 -

 $
 -

 State

 Total Current

 Deferred

 Federal

 -

 ( 585
)

 State

 -

 ( 187
)

 Total Deferred

 $
 -

 ( 772
)

 Provision (Benefit) for Income Taxes

 $

 $
 ( 752
)

 The
Company's total deferred tax assets and liabilities at December 31, 2023 and 2022 are as follows:

OF DEFERRED TAX ASSETS AND LIABILITIES

 2023

 2022

 Deferred tax assets (liabilities)

 Accruals and reserves

 $

 $

 Tax credits

 Net operating loss

 12,252

 9,272

 Asset Impairments

 1,114

 -

 Stock-based compensation

 Less valuation allowance

 ( 10,222
)

 ( 4,771
)

 Total deferred tax assets

 4,815

 5,335

 Property and equipment

 ( 1,776
)

 ( 1,903
)

 Intangibles

 ( 3,039
)

 ( 3,432
)

 Total deferred tax liabilities

 ( 4,815
)

 ( 5,335
)

 Net deferred tax liability

 $
 -

 $
 -

 The
Company uses a more-likely-than-not measurement for all tax positions taken or expected to be taken on a tax return in order for those
tax positions to be recognized in the financial statements. There were no uncertain tax positions as of December 31, 2023 and 2022. If
the Company were to incur interest and penalties related to income taxes, these would be included in the provision for income taxes,
there were none for the years ended December 31, 2023 and 2022 respectively. Generally, the three tax years previously filed remain subject
to examination by federal and state tax authorities. The Company does not expect a material change in uncertain tax positions to occur
within the next 12 months.

 For
the years ended December 31, 2023 and 2022, respectively, the reconciliation between the effective tax of ( 0.23 %) and 1.38 % on income
from operations and the statutory tax rate of 21 % and 21 % is as follows:

OF EFFECTIVE INCOME TAX RATE RECONCILIATION

 2023

 2022

 Income tax expense at federal statutory rate

 $
 ( 4,069
)

 $
 ( 11,450
)

 Paycheck Protection Program tax exempt loan forgiveness

 -

 ( 544
)

 Permanent differences

 Permanent differences for change in fair value of warrants

 ( 29
)

 Goodwill Impairment

 -

 10,400

 Non-deductible intangible assets

 -

 -

 Other adjustments

 -

 -

 State and local taxes net of federal benefit

 ( 1,329
)

 ( 3,902
)

 Valuation allowance

 5,388

 4,771

 Income tax expense (benefit)

 $

 $
 ( 752
)

 The
Company has federal net operating losses of approximately $ 44,300
of which $ 2,200
will expire beginning in 2035, $ 42,100
of the net operating losses do not expire. The Company has state Net operating losses of approximately $ 43,600
which will expire beginning in 2029. Federal net operating losses incurred beginning in 2018 are not subject to expiration under the
Tax Cuts and Jobs Act, but the annual usage is limited to 80% of pre net operating loss taxable income for years beginning after
December 31, 2020. The Company has tax credit carryforwards of approximately $ 592
which will expire beginning in 2034. A valuation allowance has been recorded for a portion of the tax credits and net operating
losses. Thus, the Company increased the valuation allowance by $ 617 and
$ 4,771 during the years ended December 31, 2023 and 2022, respectively. The deferred tax assets for the net operating losses
are presented net with deferred tax liabilities, which primarily consist of book and tax depreciation differences. Utilization of
net operating losses and tax credit carryforward may be limited by ownership change rules, as defined in section 382 and 383 of the
Internal Revenue Code.

 16.
 CAPTIVE INSURANCE

 The
Company and other companies are members of an offshore heterogeneous group captive insurance holding company entitled Navigator Casualty,
LTD. (NCL). NCL is located in the Cayman Islands and insures claims relating to workers' compensation, general liability, and auto
liability coverage.

 Premiums
are developed through the use of an actuarially determined loss forecast. Premiums paid totalled $ 359 and $ 235 for the years ended December
31, 2023 and 2022, respectively. The loss funding, derived from the actuarial forecast, is broken-out into two categories by the actuary
known as the "A & B" Funds. The "A" Fund pays for the first $ 100,000 of any loss and the "B"
Fund contributes to the remainder of the loss layer up to $ 300,000 total per occurrence.

 Each
shareholder has equal ownership and invests a one-time cash capitalization of $ 36,000. This is broken out into two categories, $ 35,900
of redeemable preference shares and $ 100 for a single common share. Each shareholder represents a single and equal vote on NCL's
Board of Directors.

 Summary
financial information on NCL as of September 30, 2023 is:

 SUMMARY
OF FINANCIAL INFORMATION

 Total assets

 $
 194,375

 Total liabilities

 $
 100,145

 Comprehensive income

 $

 NCL's
fiscal year end is September 30, 2023.

 2023

 2022

 Investment in NCL

 Capital

 $

 $

 Cash security

 Investment income in excess of losses (incurred and reserves)

 Total

 $

 $

 17.
 EARNINGS (LOSS) PER SHARE

 Basic
earnings (loss) per share ("EPS") is computed by dividing net income (loss) available to common stockholders by the weighted
average number of shares of Common Stock outstanding during the period, excluding the effects of any potentially dilutive securities.
Diluted EPS gives effect to the potential dilution that could occur if securities or other contracts to issue Common Stock were exercised
or converted into Common Stock.

OF POTENTIAL SHARE ISSUANCES EXCLUDED FROM COMPUTATION OF EARNINGS (LOSS) PER SHARE

 2023

 2022

 Years Ended December 31,

 2023

 2022

 Option to purchase Common Stock, from Jensyn's IPO

 429,000

 429,000

 Warrants to purchase Common Stock, from Jensyn's IPO

 34,572

 34,572

 Unvested restricted stock awards

 202,305

 305,023

 Unexercised options to purchase Common Stock

 888,084

 225,666

 Unvested options to purchase Common Stock

 -

 350,667

 Private warrants to purchase common shares from Anson Note

 1,000,000

 -

 Series A Convertible Preferred Stock

 300,000

 -

 Totals

 2,853,961

 1,344,928

 The
Company has contingent share arrangements and warrants with the potential issuance of additional shares of Common Stock from these arrangements
which were excluded from the diluted EPS calculation because the prevailing market and operating conditions at the present time do not
indicate that any additional shares of Common Stock will be issued. These instruments could result in dilution in future periods.

 18.
 RESTRICTED STOCK AND STOCK OPTIONS

 Options

 As
of December 31, 2023, the Company has 605,249 non-qualified stock options outstanding to purchase 605,249 shares of Common Stock, per
the terms set forth in the option agreements. The stock options vest at various times and are exercisable for a period of five years
from the date of grant at an exercise price of $ 2.84 per share, the fair market value of the Company's Common Stock on the date
of each grant. The Company determined the fair market value of these options to be $ 294 by using the Black Scholes option valuation
model. The key assumptions used in the valuation of the options were as follows; a) volatility of 146.38 %, b) term of 2 years, c) risk
free rate of 4.41 % and d) a dividend yield of 0 %.

OF SHARE BASED PAYMENT ARRANGEMENT, OPTION, ACTIVITY

 December 31, 2023

 Number of
 Options

 Weighted average
 exercise price

 Outstanding, beginning January 1, 2023

 576,334

 $
 3.80

 Granted

 410,000

 $
 1.03

 Exercised

 -

 $
 -

 Forfeited

 98,250

 $
 -

 Outstanding, ending December 31, 2023

 888,084

 $
 2.94

 Exercisable at December 31, 2023

 605,249

 $
 2.84

 December 31, 2022

 Number of
 Options

 Weighted average
 exercise price

 Outstanding, beginning January 1, 2022

 201,334

 $
 1.49

 Granted

 375,000

 $
 5.04

 Exercised

 -

 $
 1.49

 Outstanding, ending December 31, 2022

 576,334

 $
 3.80

 Exercisable at December 31, 2022

 225,666

 $
 3.46

 The
above table does not include the 429,000 options issued as part of the Jensyn IPO.

 Aggregate
intrinsic value of options outstanding was $ 0 at December 31, 2023 and 2022.
Aggregate intrinsic value represents the difference between the Company's closing stock price on the last trading day of the
fiscal period which was $ 0.31
as of December 31, 2023 and the exercise price multiplied by the number of options outstanding.

the years ended December 31, 2023 and 2022, the Company charged a total of $ 362
 and $ 1,359,
respectively to operations to recognize stock based compensation expense for stock options. As of December 31, 2023, the Company had
$ 169
 in unrecognized stock-based compensation expense
related to 207,834
 stock option awards, which is expected to be
recognized over a weighted average period of less than three
years. All options are expected to vest.

 Restricted
Stock Grant to Executives

 With
an effective date of January 3, 2023, subject to the iSun, Inc. 2020 Equity Incentive Plan, (the "2020 Plan"), the
Company entered into a Restricted Stock Grant Agreement with our Chief Executive Officer and Chief Financial Officer Jeffrey Peck,
Former Chief Financial Officer John Sullivan, and Kenneth Merritt in January 2023 (the January 2023 RSGAs). All shares issuable
under the January 2023 RSGA are valued as of the grant date at $ 1.32
per share representing the fair market value. The January 2023 RSGA provides for the issuance of up to 180,000
shares of the Company's Common Stock. During 2023, 93,334
of the restricted shares vested, and the remaining unvested shares shall vest as follows, 43,333
of the restricted shares shall vest on December 31, 2024, and the balance, or 43,333
restricted shares, shall vest on December 31, 2025.

 With an effective date of January 24, 2022, subject to the iSun, Inc.
2020 Equity Incentive Plan, (the "2020 Plan"), the Company entered into a Restricted Stock Grant Agreement with our Chief
Executive Officer and Chief Financial Officer Jeffrey Peck, Former Chief Financial
Officer John Sullivan, Executive Vice President Fredrick Myrick, and Chief Strategy Officer Michael dAmato in January 2022 (the
January 2022 RSGAs). All shares issuable under the January 2022 RSGA are valued as of the grant date at $ 5.04
per share representing the fair market value. The January 2022 RSGA provides for the issuance of up to 187,500
shares of the Company's Common Stock. The restricted shares shall vest as follows: 62,500
of the restricted shares shall vest immediately, 62,500
of the restricted shares shall vest on the one (1) year anniversary of the effective date, and the balance, or 62,500
restricted shares, shall vest on the two (2) year anniversary of the effective date. The remaining unvested shares and non-forfeited shares of 37,499 shall vest in the year ending December 31, 2024.

 With an effective date of April 18, 2022, subject to the iSun, Inc.
2020 Equity Incentive Plan, (the "2020 Plan"), the Company entered into a Restricted Stock Grant Agreement with our Chief
Executive Officer and Chief Financial Officer Jeffrey Peck, Former Chief Financial
Officer John Sullivan, Executive Vice President Fredrick Myrick, and Chief Strategy Officer Michael dAmato in April 2022 (the April
2022 RSGAs). All shares issuable under the April 2022 RSGA are valued as of the grant date at $ 3.63
per share representing the fair market value. The April 2022 RSGA provides for the issuance of up to 337,033
shares of the Company's Common Stock. The restricted shares shall vest as follows: 112,345
of the restricted shares shall vest on December 31, 2022, 112,345
of the restricted shares shall vest on December 31, 2023, and the balance, or 112,343
restricted shares, shall vest on December 31, 2024. The remaining unvested and non-forfeited shares of 78,120 shall vest in the year ending December 31, 2024.

the years ended December 31, 2023 and 2022, stock-based compensation expense of $ 717 and $ 1,359 was recognized for the January 2021 RSGA,
January 2022 RSGA and April 2022 RSGA, respectively.

 19.
 SERIES A CONVERTIBLE PREFERRED STOCK

 Pursuant
to the Letter Agreement dated December 12,2023, the Company issued 300,000
shares of the Series A Convertible Redeemable Preferred Stock, par value $ 0.0001
per share ("Preferred Stock") to the Investors in a private placement transaction (see note #7). The shares of Preferred
Stock are convertible, at a conversion price equal to 90 %
of the lowest Volume Weighted Average Price during the 10 trading days immediately prior to conversion, into Common Stock, at the
option of the holders, provided that the Company will not effect any conversion that would result in the holders owning in excess of
9.99% of the Company's outstanding Common Stock. The Letter Agreement contains customary representations, warranties and
agreements. As of December 31, 2023, there were 300,000
shares authorized, issued and outstanding with a par value of $ 0.0001
per share. The shares feature a liquidation preference and had a liquidation value of $ 3,000,000
as of December 31, 2023. Dividends in-kind at the rate per annum
of 7 % of the stated value per share shall accrue on each outstanding share of the Preferred Stock from and after the date of the original
issuance of such share of Preferred Stock.

 Under
ASC 470, a difference between the reacquisition price of debt and the net carrying amount of the extinguished debt shall be recognized
currently in income of the period of extinguishment as losses or gains and identified as a separate item. If upon extinguishment of debt
the parties also exchange unstated (or stated) rights or privileges, the portion of the consideration exchanged allocable to such unstated
(or stated) rights or privileges shall be given appropriate accounting recognition. Moreover, extinguishment transactions between related
entities may be in essence capital transaction. The Preferred Stock is classified as a derivative liability due to the Company not having
enough authorized shares in the event of a full redemption and has a carrying value of $ 3.9
 million as of December 31, 2023. The Company
utilized a Monte Carlo simulation to determine the fair value at the time of issuance. The Company used two scenarios to calculate the
fair value of the Series A Convertible Preferred Stock which included: a) The Preferred Shares are held until Redemption and b) The Preferred
Shares are Converted to Common Shares. The Company determined that 6,694 simulations out of 20,000 simulations had a Common stock price
that was equal to or greater than $ 0.857. Therefore, there is a 33.47 % probability that shareholders will convert to Common shares. Conversely,
there is a 66.53 % probability that shareholders will hold the Preferred shares until the redemption date. The Company then applied the
present value of holding the Preferred shares until the redemption date and converting the Preferred shares to Common shares to their
respective probabilities. This results in a total present value of $ 3,882 and a per share value of $ 12.94.

 20.
 SALES OF COMMON STOCK PURSUANT TO S-3 REGISTRATION STATEMENT

 The
Company issued 21,572,538 shares and 3,213,897 shares of common stock during the years ended 2023 and 2022, resulting in increases of
$ 7,714 and $ 14,421 to stockholders' equity, respectively.

 21.
 INVESTMENTS

 Investments
consist of:

 SCHEDULE OF INVESTMENT

 2022

 2022

 GreenSeed Investors, LLC

 $
 -

 $
 3,924

 Investment in Solar Project Partners, LLC

 -

 Investment in Gemini Electric Mobility Co.

 2,000

 2,000

 Investment in NAD Grid Corp. d/b/a Amp Up

 1,000

 1,000

 Investment in Encore Renewables

 5,000

 5,000

 Total

 $
 8,000

 $
 12,020

 GreenSeed
Investors, LLC ("GSI") and Solar Project Partners, LLC ("SPP")

 For the year ended December 31, 2023, the Company determined there were indicators that would cause a 100 % impairment of the GSI and SPP investments due to the fair value of the investments remaining at a level below its cost. The Company therefore recorded an impairment expense of $ 4.0 million for its investments in GSI and SPP during the year ended December 31, 2023, as reflected in the accompanying
consolidated statements of operations.

 The
GSI and SPP investments are measured at cost, less impairment, if any, plus or minus changes resulting from observable price changes
in ordinary transactions for the identical or similar investment of the same issuer. As the Company does not have significant influence
over operating or financial policies of GSI and SPP, the cost method of accounting for the investment was determined to be appropriate.
Changes in the fair value of the investment are recorded as net appreciation in fair value of investment in the Consolidated Statements
of Operations. No net appreciation or depreciation in fair value of the investments was recorded during the year ended December 31, 2023,
as there were no observable price changes.

 22.
 INTANGIBLES

 The
Company's intangible assets at December 31, 2023 consist of:

OF FINITE LIVED INTANGIBLE ASSETS

 Amortization
 periods

2023

2022

 iSun Trademark and Brand

 10 Years

 $
 3,007

 $
 3,007

 Intellectual property

 10 Years

 1,000

 1,000

 Backlog of projects

 12 Months

 3,220

 3,220

 SunCommon Trademark and Brand

 10 Years

 11,980

 11,980

 Intangible assets, gross

 10 Years

 11,980

 11,980

 Accumulated amortization

 ( 6,768
)

 ( 5,169
)

 Total

 $
 12,439

 $
 14,038

 At
December 31, 2023 and 2022, amortization expense was $ 1,599 and $ 4,820, respectively.

 Estimated
future amortization expense for the Company's intangible assets as of December 31, 2023 is as follows:

 SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS, FUTURE AMORTIZATION
EXPENSE

 Cost

 2024

 $
 1,599

 2025

 1,599

 2026

 1,599

 2027

 1,599

 2028

 1,599

 Thereafter

 4,444

 Total

 $
 12,439

 The
estimated weighted average remaining period of amortization is 9 years.

 23.
 REVISIONS OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

the year ended December 31, 2022, the company recognized an impairment loss related to goodwill for the year ended December 31,
2022. The tax provision included this impairment loss as a deduction for tax purposes and part of the deferred tax asset for
"Net operating loss", and a separate valuation allowance in the same amount. The total included as a deferred tax asset
and valuation allowance was $ 10,400
and ($ 10,400)
respectively. The Net Deferred tax asset balance as of December 31, 2022 as a result of these changes remains at $ 5,335
with no change to the net deferred tax asset balance.

 In
accordance with Staff Accounting Bulletin ("SAB") 99, Materiality, and SAB 108, Considering the Effects of Prior
Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the materiality of
the error from qualitative and quantitative perspectives, and concluded that the error was immaterial to any prior annual or interim
financial statements. Notwithstanding this conclusion, management has revised the accompanying financial statements and related notes
included herein to correct this error for all periods presented.

 The
following table presents the effect of correcting this error on the Company's previously issued footnotes related the deferred
tax assets and liabilities at December 31, 2022. There were no changes to the statements of stockholders' equity, balance sheets
or statements of operations.

OF CORRECTING ERROR

 As previously reported

 Adjustment

 As revised

 As of December 31, 2022

 As previously reported

 Adjustment

 As revised

 Deferred tax assets (liabilities)

 Net operating loss

 19,673

 ( 10,400
)

 9,273

 Less Valuation Allowance

 ( 15,171
)

 10,400

 ( 4,771
)

 Total Deferred tax assets

 5,335

 5,335

 24.
 SUBSEQUENT EVENTS

 The
Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the financial statements
were issued. Other than as described below, the Company did not identify any subsequent events that would have required adjustment or
disclosure in the financial statements.

 Cash Advance Funding

 In
September 2023, the Company agreed to two cash advance funding agreements totaling $ 1,500. At December 31, 2023, the amount of $ 600 is
included in accrued expenses as a current liability. On January 4 th 2024, the Company refinanced these two cash advance funding
agreements, bringing the outstanding balance to $ 2.4 million.

 Item
 9.

 Changes
 in and Disagreements with Accountants on Accounting and Financial Disclosure.

 None.

 Item
 9A.

 Controls
 and Procedures.

 Evaluation
of Disclosure Controls and Procedures

 Our
management, including our principal executive officer and principal financial and accounting officer, did not carry out an
evaluation of the effectiveness of our disclosure controls and procedures as of December 31, 2023, as such term is defined in Rules
13a-15(e) and 15d-15(e) under the Exchange Act. Management has determined there is a lack of supervisory review of the financial
statement closing process due to limited resources and formal documentation of procedures and controls and a lack of segregation of duties and access with the IT environment. These control deficiencies
constitute material weaknesses in internal control over financial reporting. As a result, our principal executive officer and
principal financial and accounting officer have concluded that during the period covered by this report, our disclosure controls and
procedures were not effective. We plan to take steps to remedy this material weakness in with the implementation of an
"Internal Control-Integrated Framework"

 Disclosure
controls and procedures are designed to ensure that the information that is required to be disclosed by us in our Exchange Act report
is recorded, processed, summarized, and reported within the time periods specified in the SEC's rules and forms, and that such
information is accumulated and communicated to our management, including our principal executive officer and principal financial and
accounting officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 Limitations
on the Effectiveness of Controls

 Our
management, including our principal executive officer and principal financial officer, do not expect that our disclosure controls and
procedures or our internal controls will prevent all errors or fraud. A control system, no matter how well conceived and operated, can
provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control
system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs.
Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues
and instances of fraud, if any, have been detected.

 Management's
Report on Internal Control Over Financial Reporting

 Our
management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f)
under the Securities Exchange Act of 1934, as amended. Our management assessed the effectiveness of our internal control over financial
reporting as of December 31, 2023. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission ("COSO") in Internal Control-Integrated Framework (2013).

 Management
previously identified control deficiencies regarding the need for a stronger internal control environment relating to the financial statement
closing process, formal documentation and designed disclosure controls and procedures and testing of the operating effectiveness of the
controls. In 2023 Management took additional steps to remediate these control deficiencies as part of the expansion of the internal control
environment. Management implemented a new Enterprise Resource Planning ("ERP") system which provides the necessary control
environment to mitigate the potential for misstatements in the financial reporting. In addition, specific procedures were implemented
to enhance overall controls, dual authorization of payments, purchase order approval process and authorization matrix, segregation of
duties related to financial reporting and user permissions and controls within the ERP. Management continues to enhance the internal
control environment but has not completed the implementation and testing of the new and revised internal controls. Management believes
that these control deficiencies constitute material weaknesses in internal control over financial reporting for the year ended December
31, 2023.

 Based
upon the criteria established in "Internal Control-Integrated Framework" issued by the COSO, management believes that the
controls currently in place are not adequate. As such, material weaknesses existed as of December 31, 2023.

 Changes
in Internal Control Over Financial Reporting

 Other
than the control improvements discussed in Management's Report on Internal Control Over Financial Reporting above, there was no
change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the
quarter ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over
financial reporting.

 No
Attestation Report by Independent Registered Accountant

 The
effectiveness of our internal control over financial reporting as of December 31, 2023 has not been audited by our independent registered
public accounting firm by virtue of our exemption from such requirement as a non-accelerated smaller reporting company.

 Item
 9B.

 Other
 Information.

 None.

 Item
 9C.

 Disclosure
 Regarding Foreign Jurisdictions that Prevent Inspections.

 None.

 PART
III

 Item
 10.

 Directors,
 Executive Officers and Corporate Governance

 The
information required for item is incorporated by reference from our Proxy Statement to be filed in connection with our 2024 Annual Meeting
of Shareholders.

 Item
 11.

 Executive
 Compensation

 The
information required for this item is incorporated by reference from our Proxy Statement to be filed in connection with our 2024 Annual
Meeting of Shareholders.

 Item
 12.

 Security
 Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 The
information required for this item is incorporated by reference from our Proxy Statement to be filed in connection with our 2024 Annual
Meeting of Shareholders.

 Item
 13.

 Certain
 Relationships and Related Transactions and Director Independence

 The
information required for this item is incorporated by reference from our Proxy Statement to be filed in connection with our 2024 Annual
Meeting of Shareholders.

 Item
 14.

 Principal
 Accounting Fees and Services

 The
information required for this item is incorporated by reference from our Proxy Statement to be filed in connection with our 2023 Annual
Meeting of Shareholders.

 PART
IV

 Item
 15.

 Exhibits,
 Financial Statement Schedules.

 (1)
 Financial Statements.

 The
financial statements required by Item 15 are submitted in a separate section of this report, beginning on Page F-1, incorporated herein
and made a part hereof.

 (2)
 Financial Statement Schedules.

 Schedules
have been omitted because of the absence of conditions under which they are required or because the required information is included
in the financial statements or notes thereto.

 (3)
 Exhibits.

 The
following exhibits are filed with this report, or incorporated by reference as noted:

 (a)

 101.INS

 101.SCH

 101.CAL

 101.DEF

 101.LAB

 101.PRE

 *

 Filed
herewith.

 (b)

 Exhibits.

 See
(a)(3) above.

 (c)
Financial Statement Schedules.

 See
(a)(2) above.

 See
(a)(2) above.

 Exhibits

 Exhibit

 No.

 Description

 Included

 Form

 Filing
 Date

 1.1

 Underwriting Agreement, dated March 2, 2016, between Jensyn Acquisition Corp. and Chardan Capital Markets, LLC, as representative of the underwriters named on Schedule A thereto.

 By

 March
 10, 2016

 1.2

 Sales Agreement, dated December 4, 2020, between The Peck Company Holdings, Inc. and A.G.P./Alliance Global Partners

 By

 S-3

 4, 2020

 3.1

 Certificate of Designation, Preferences and Rights of Preferred Stock of The Peck Company Holdings, Inc.

 By

 April

 3.2

 Third Amended & Restated Certificate of Incorporation of iSun, Inc.

 By

 February
 2, 2022

 3.3

 First Amended and Restated Certificate of Designation, Preferences and Rights of Preferred Stock of iSun, Inc.

 By

 February
 26, 2021

 3.4

 Certificate of Cancellation of Series A Convertible Preferred Stock of iSun, Inc.

 By

 30, 2021

 3.5

 Bylaws.

 By

 S-1

 23, 2015

 3.6

 Certificate of Designation of Series A Convertible Redeemable Preferred Stock

 By

 13, 2023

 4.1

 Specimen Common Stock Certificate.

 By

 S-1

 23, 2015

 4.2

 Promissory Note, dated September 17, 2019, issued to NBT Bank, National Association

 By

 18, 2019

 4.3

 Warrant Agreement, dated March 2, 2016, between Jensyn Acquisition Corp. and Continental Stock Transfer & Trust Company.

 By

 March
 10, 2016

 4.4

 Warrant, dated April 22, 2020, issued by The Peck Company Holdings, Inc. to GreenSeed Investors, LLC

 By

 April

 4.5

 Promissory Note, dated January 13, 2020, issued by Peck Electric Co. to NBT Bank, National Association

 By

 April

 4.6

 Paycheck Protection Program Note and Disbursement Authorization, dated April 24, 2020 issued by Peck Electric Co. to NBT Bank, National Association

 By

 April

 4.7

 Amendment No. 1 to Warrant Agreement, dated March 9, 2021

 By

 March
 9, 2021

 4.8

 Notice of Redemption, dated March 9, 2021

 By

 March
 9, 2021

 4.9

 Form of Securities Purchase Agreement, dated January 8, 2021 between The Peck Company Holdings, Inc. and certain investors

 By

 January
 12, 2021

 4.10

 Senior Secured Convertible Notes, issued by iSun, Inc. dated November 4, 2022

 By

 4.11

 Warrant to Purchase Common Stock, dated August 30, 2023, by and between iSun, Inc. and Anson Investments Master Fund LP.

 By

 1, 2023

 4.12

 Warrant to Purchase Common Stock, dated August 30, 2023, by and between iSun, Inc. and Anson East Master Fund LP.

 By

 1, 2023

 10.1

 Voting Agreement, dated June 20, 2019, between Peck Company Holdings
Inc. and Jeffrey Peck

 By

 April
 14, 2020

 10.2

 Lease Agreement, dated December 7, 2020, between Peck Electric Co. and Unsworth Properties, LLC as agent for Meach, LLC, 306 West Indian, LLC, Cooper Two, LLC, Trek Communities, LLC, Masthead, LLC and Stephen and Shona Unsworth

 By

 10, 2020

 10.3

 2020 Equity Incentive Plan

 By

 S-8

 October

 10.4

 Placement Agent Agreement, dated January 8, 2021, between The Peck Company Holdings, Inc. and A.G.P./Alliance Global Partners

 By

 January
 12, 2021

 10.5

 Irrevocable Proxy between The Peck Company Holdings, Inc. and Sassoon M. Peress, dated January 19, 2021

 By

 January
 25, 2021

 10.6

 Assignment Agreement by and among Adani Solar USA, Inc., Oakwood Construction Services, Inc. and iSun Utility, LLC, dated April 6, 2021

 By

 April
 8, 2021

 10.7

 Sales Agreement, dated June 21, 2021, between iSun, Inc. and B. Riley Securities, Inc.

 By

 June
 22, 2021

 10.8

 Form of Put Agreement between iSun, Inc. and certain SunCommon Shareholders

 By

 13, 2021

 10.9

 Form of Employment Agreement between iSun, Inc. and each of Jeffrey Irish, James Moore, and Duane Peterson

 By

 13, 2021

 10.10

 First Amended and Restated Letter Agreement, by and among iSun, Inc., iSun Residential, Inc., iSun Residential Merger Sub, Inc., SolarCommunities, Inc. d/b/a SunCommon, Duane Peterson, James Moore, and Jeffrey Irish, dated September 30, 2021

 By

 October
 5, 2021

 10.11

 Employment Agreement between iSun, Inc. and Frederick Myrick, dated July 1, 2021

 By

 10.12

 Change of Control Agreement between iSun, Inc. and Frederick Myrick, dated July 1, 2021

 By

 10.13

 Employment Agreement between iSun, Inc. and Jeffrey Peck, dated July 1, 2021

 By

 10.14

 Change
 of Control Agreement between iSun, Inc. and Jeffrey Peck, dated July 1, 2021

 By

 10.15

 Employment Agreement between iSun, Inc. and John Sullivan, dated July 1, 2021

 By

 10.16

 Change of Control Agreement between iSun, Inc. and John Sullivan, dated July 1, 2021

 By

 10.17

 Employment Agreement between John Stark Electric, Inc. and John P. Comeau, dated as of October 31, 2021

 By

 19, 2021

 10.18

 Irrevocable Proxy between iSun, Inc. and John P. Comeau, dated as of October 31, 2021

 By

 19, 2021

 10.19

 Membership Unit Purchase Agreement between iSun, Inc. and Encore Redevelopment, LLC, dated November 24, 2021

 By

 1, 2021

 10.20

 Sixth Amended and Restated Operating Agreement of Encore Redevelopment, Inc, dated November 24, 2021

 By

 1, 2021

 10.21

 Industrial Building Lease by and Between Industry Landing 115 LLC and SolarCommunities, Inc., dated August 1, 2021

 By

 April
 15, 2022

 10.22

 Lease Agreement between Malone Route 2 Waterbury Properties, LLC and SolarCommunities, Inc., dated October 19, 2015

 By

 April
 15, 2022

 10.23

 Addendum #1 to Lease Agreement between Malone Route 2 Waterbury Properties, LLC and SolarCommunities, Inc., dated July 19, 2016

 By

 April
 15, 2022

 10.24

 Addendum #2 to Lease Agreement between Malone Route 2 Waterbury Properties, LLC and SolarCommunities, Inc., dated March 2, 2019

 By

 April
 15, 2022

 10.25

 Securities Purchase Agreement between iSun, Inc. and certain Purchasers, dated November 4, 2022

 By

 10.26

 Security Agreement between iSun, Inc. and certain Purchasers, dated November 4, 2022

 By

 10.27

 Trademark Security Agreement between iSun, Inc. and certain Purchasers, dated November 4, 2022

 By

 10.28

 Subsidiary Guaranty by and among iSun, Inc. and its direct and indirect subsidiaries, dated November 4, 2022

 By

 10.29

 Registration Rights Agreement between iSun, Inc. and certain Purchasers, dated November 4, 2022

 By

 10.30

 Voting Agreement by and among iSun, Inc. and certain other parties, dated November 4, 2022

 By

 10.31

 First Amendment to Agreement and Plan of Merger and Reorganization by and among iSun, Inc., iSun Energy LLC, and Sassoon M. Peress, dated November 28, 2022

 By

 April
 17, 2023

 10.32

 Letter Agreement, dated August 30, 2023, by and between iSun, Inc., Anson Investments Master Fund LP, and Anson East Master Fund LP.

 By

 1, 2023

 10.33

 Letter Agreement, dated August 30, 2023, by and between iSun, Inc., Anson Investments Master Fund LP, and Anson East Master Fund LP.

 By

 1, 2023

 10.34

 Revenue Loan and Security Agreement with Decathlon Specialty Finance, LLC, dated December 12, 2023

 By

 13, 2023

 10.35

 Letter Agreement, dated December 12, 2023, by and between iSun, Inc., Anson Investments Master Fund LP, and Anson East Master Fund LP.

 By

 13, 2023

 10.36

 Lock-Up Agreement, dated December 12, 2023, by and between iSun, Inc., Anson Investments Master Fund LP, and Anson East Master Fund LP.

 By

 13, 2023

 10.37

 Loan Agreement, dated April 4, 2023, between iSun, Inc. and Lendspark Corporation

 10.38

 Standard Merchant Cash Advance Agreement, dated January 4, 2024, between iSun Industrial, LLC and Cedar Advance LLC

 10.39

 Standard Merchant Cash Advance Agreement, dated January 4, 2024, between iSun Industrial, LLC and Pawn Funding

 Form of Code of Ethics.

 By

 S-1

 23, 2015

 List of subsidiaries of iSun, Inc.

 23.1

 Independent Registered Public Accounting Firm's Consent

 31.1

 Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 31.2

 Certification of Principal Financial and Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 32.1

 Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 97.1

 iSun, Inc. Clawback Policy

 101.INS

 101.SCH

 101.CAL

 101.DEF

 101.LAB

 101.PRE

 Cover

 Item
 16.

 Form
 10-K Summary.

 Not
applicable

 SIGNATURES

 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

 iSUN,
 INC.

 By:

 /s/
 Jeffrey Peck

 Jeffrey
 Peck

 Chief Executive Officer and Interim Chief Financial Officer

 (Principal
 Executive Officer)

 Dated:
 April 16, 2024

 POWER
OF ATTORNEY

 The undersigned directors and officers of iSun, Inc., hereby constitute
and appoint Jeffrey Peck, with full power to act without the other and with full power of substitution and resubstitution, our true and
lawful attorneys-in-fact with full power to execute in our name and on behalf in the capacities indicated below, this annual report on
Form 10-K and any and all amendments thereto and to file the same, with all exhibits thereto and other documents in connection therewith
with the Securities and Exchange Commission, and hereby ratify and confirm all that such attorneys-in-fact, or any of them, or their substitutes
shall lawfully do or cause to be done by virtue hereof.

 In
accordance with the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant
and in such capacities and on the dates indicated.

 By:

 /s/
 Jeffrey Peck

 Chief Executive Officer and Interim Chief Financial Officer

 (Principal Executive Officer)

 By:

 /s/
 Fredrick Myrick

 Fredrick
 Myrick

 Executive
 Vice President and Director

 By:

 /s/
 Stewart Martin

 Stewart
 Martin

 Director

 By:

 /s/
 Andrew Matthy

 Andrew
 Matthy

 Director

 By:

 /s/
 Claudia Meer

 Claudia
 Meer

 Director

 Dated:
 April 16, 2024