EX-99.2 5 exhibit992atsauditedstat.htm EXHIBIT 99.2
ALPHA TECHNOLOGIES SERVICES, INC. CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2017 AND 2016

CONTENTS INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS Consolidated balance sheet 3 Consolidated statement of income and comprehensive income 4 Consolidated statement of stockholder's equity and comprehensive income 5 Consolidated statement of cash flows 6 Notes to consolidated financial statements 7‐22

April 27, 2018 To the Stockholder Alpha Technologies Services, Inc. Bellingham, Washington Independent Auditors' Report We have audited the accompanying consolidated financial statements of Alpha Technologies Services, Inc., which comprise the consolidated balance sheet as of December 31, 2017 and 2016, and the related consolidated statements of income and comprehensive income, stockholder's equity and comprehensive income and cash flows for the years then ended, and the related notes to the consolidated financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We did not audit the financial statements of Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda., a wholly owned subsidiary, which statements reflect total assets of $4,721,441 and $3,530,968 as of December 31, 2017 and 2016, respectively, and total revenues of $6,141,251 and $5,012,956, respectively, for the years then ended. Those statements were audited by other auditors, whose reports have been furnished to us, and our opinion, insofar as it relates to the amounts included for Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda., is based solely on the report of the other auditors. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Berntson Porter & Company, PLLC 11100 NE 8th St Ste 400 — Bellevue, WA 98004 www.bpcpa.com voice: 425.454.7990 fax: 425.454.7742 toll free: 800.876.6931

Alpha Technologies Services, Inc. Page 2 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, based on our audits and the reports of the other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Alpha Technologies Services, Inc. as of December 31, 2017 and 2016 and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America. Other Auditors' Report on the Financial Statement of Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda. The opinion of the other auditors on the 2017 and 2016 financial statements of Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda. was qualified because Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda. has excluded the calculation of transfer pricing for transactions with foreign related parties, the evaluation of tax, labor and social security processes from previous years, and the compensation of management personnel by the company. However, in our opinion, the effects of excluding such matters are not material in relation to the consolidated financial statements. Accordingly, our opinion on the consolidated financial statements is not modified with respect to these matters. Berntson Porter & Company, PLLC Certified Public Accountants

Alpha Technologies Services, Inc. Consolidated Balance Sheet ASSETS December 31, 2017 2016 CURRENT ASSETS Cash $ 1,873,864 $ 2,083,156 Receivables, net 59,281,885 49,074,797 Unbilled receivables 5,112,715 6,034,551 Inventory, net 14,692,147 11,156,971 Income tax deposits 535,760 155,567 Prepaid expenses and other current assets 3,752,711 3,524,120 TOTAL CURRENT ASSETS 85,249,082 72,029,162 PROPERTY AND EQUIPMENT, net 7,091,464 5,858,479 INVESTMENTS 2,195,731 1,018,134 INTANGIBLE ASSETS, net 136,356 ‐ GOODWILL, net 8,324,387 9,938,345 DEFERRED FEDERAL INCOME TAXES 367,000 906,000 TOTAL ASSETS $ 103,364,020 $ 89,750,120 LIABILITIES AND STOCKHOLDER'S EQUITY CURRENT LIABILITIES Checks issued in excess of bank balance $ 950,032 $ 600,270 Line of credit 771,819 8,104,499 Accounts payable 40,046,544 33,955,757 Accrued payroll and related liabilities 3,697,152 3,114,288 Business taxes payable and other current liabilities 21,142,664 14,009,944 Income taxes payable 203,529 670,007 Provision for losses on contracts in progress 23,760 158,174 Deferred revenue 2,435,982 2,288,047 Warranty provision 881,067 947,568 Current portion of long‐term debt 2,316,263 ‐ Current portion of notes payable to related parties 2,325,167 ‐ Current portion of deferred rent 71,731 64,972 TOTAL CURRENT LIABILITIES 74,865,710 63,913,526 LONG‐TERM DEBT, less current portion 399,701 ‐ NOTES PAYABLE TO RELATED PARTIES, less current portion 13,889,980 14,211,491 DEFFERED RENT, less current portion 101,288 173,376 TOTAL LIABILITIES 89,256,679 78,298,393 STOCKHOLDER'S EQUITY 14,107,341 11,451,727 TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 103,364,020 $ 89,750,120 The accompanying notes are an integral part of these financial statements. 3

Alpha Technologies Services, Inc. Consolidated Statement of Income and Comprehensive Income Years Ended December 31, 2017 2016 Revenue, net $ 271,453,012 100.0 % $ 301,224,523 100.0 % Cost of revenue 188,794,479 69.5 221,601,549 73.6 GROSS PROFIT 82,658,533 30.5 79,622,974 26.4 Operating expenses Personnel 40,114,320 14.8 36,397,499 12.1 Management fees 22,450,865 8.3 17,071,708 5.7 Other general and administrative 10,077,480 3.7 15,506,812 5.1 Depreciation and amortization 2,506,300 0.9 2,410,245 0.8 Rent 1,549,504 0.6 1,719,857 0.6 Legal and audit 755,807 0.3 673,689 0.2 Bad debt, net of recoveries 98,909 0.0 686,857 0.2 Total operating expenses 77,553,185 28.6 74,466,667 24.7 INCOME FROM OPERATIONS 5,105,348 1.9 5,156,307 1.7 Other income (expense) Foreign currency transaction gain 408,660 0.2 555,556 0.2 Other income 383,564 0.1 470,954 0.2 Gain on disposal of property and equipment 44,443 0.0 5,764 0.0 Interest income 27,933 0.0 77,189 0.0 Other expense (206,668) (0.1) (602,804) (0.2) Interest expense (1,209,929) (0.4) (851,240) (0.3) Loss on business combinations ‐ ‐ (2,571,841) (0.9) Total other income (expense), net (551,997) (0.2) (2,916,422) (1.0) INCOME BEFORE TAXES 4,553,351 1.7 2,239,885 0.7 Income tax expense (benefit) Current 1,487,890 0.5 2,035,162 0.7 Deferred 539,000 0.2 (220,000) (0.1) Total income tax expense (benefit), net 2,026,890 0.7 1,815,162 0.6 NET INCOME 2,526,461 1.0 424,723 0.1 Net loss attributable to non‐controlling interest ‐ ‐ 150,721 0.1 NET INCOME ATTRIBUTABLE TO ALPHA TECHNOLOGIES SERVICES, INC. $ 2,526,461 1.0 % $ 575,444 0.2 % Other comprehensive income (loss) Foreign currency translation income (loss) 129,153 (398,769) TOTAL COMPREHENSIVE INCOME $ 2,655,614 $ 176,675 The accompanying notes are an integral part of these financial statements. 4

Alpha Technologies Services, Inc. Consolidated Statement of Stockholder's Equity and Comprehensive Income Total Common stock * Accumulated Alpha Number of other Technologies Non‐ shares issued & Retained comprehensive Services, Inc. controlling outstanding Amount earnings income (loss) equity interest Total Balance at January 1, 2016 1,000 $ 1,000 $ 11,174,064 $ 99,988 $ 11,275,052 $ (290,515) $ 10,984,537 Net income (loss) ‐ ‐ 575,444 ‐ 575,444 (150,721) 424,723 Foreign currency translation loss ‐ ‐ ‐ (398,769) (398,769) ‐ (398,769) Acquisition of stock in NavSemi Energy Pte. Ltd. (Note 20) ‐ ‐ ‐ ‐ ‐ 441,236 441,236 Balance at December 31, 2016 1,000 1,000 11,749,508 (298,781) 11,451,727 ‐ 11,451,727 Net income ‐ ‐ 2,526,461 ‐ 2,526,461 ‐ 2,526,461 Foreign currency translation gain ‐ ‐ ‐ 129,153 129,153 ‐ 129,153 Balance at December 31, 2017 1,000 $ 1,000 $ 14,275,969 $ (169,628) $ 14,107,341 $ ‐ $ 14,107,341 * Authorized 50,000 shares, no par value. The accompanying notes are an integral part of these financial statements. 5

Alpha Technologies Services, Inc. Consolidated Statement of Cash Flows Years Ended December 31, 2017 2016 CASH FLOW FROM OPERATING ACTIVITIES Net income $ 2,526,461 $ 424,723 Adjustments to reconcile net income to net cash provided by (used in) operating activities Depreciation and amortization 2,506,300 2,410,245 Loss on business combinations ‐ 2,571,841 Gain on disposal of property and equipment (44,443) (5,764) Deferred federal income taxes 539,000 (220,000) Deferred rent (65,329) (58,516) Allowance for doubtful accounts (32,191) 523,925 Allowance for inventory obsolescence (293,501) (109,499) (Increase) decrease in: Receivables (10,174,897) (6,541,104) Unbilled receivables 921,836 (3,462,432) Inventory (3,241,675) 6,950,137 Income tax deposits (380,193) 786,203 Prepaid expenses and other current assets (224,427) 1,196,470 Increase (decrease) in: Accounts payable 10,633,842 3,135,203 Accrued payroll and related liabilities 582,864 691,248 Business taxes payable and other current liabilities 7,132,720 (901,319) Income taxes payable (466,478) 670,007 Provision for losses on contracts in progress (134,414) (1,167,511) Deferred revenue 147,935 (21,650,420) Warranty provision (66,501) 104,842 Net cash provided by (used in) operating activities 9,866,909 (14,651,721) CASH FLOW FROM INVESTING ACTIVITIES Purchase of property and equipment (2,116,945) (351,488) Investment in corporation (1,182,421) ‐ Purchase of non‐compete agreement (144,078) ‐ Proceeds from the disposal of property and equipment 44,443 160,589 Net liabilities assumed through business combinations ‐ (1,703,993) Net cash used in investing activities (3,399,001) (1,894,892) CASH FLOW FROM FINANCING ACTIVITIES Net borrowings (repayments) on line of credit (7,332,680) 3,255,585 Proceeds from issuance of notes payable to related parties 2,003,656 545,053 Principal payments on long‐term debt (1,827,091) ‐ Checks issued in excess of bank balance 349,762 600,270 Net cash provided by (used in) financing activities (6,806,353) 4,400,908 Foreign currency translation adjustment 129,153 (398,769) NET CHANGE IN CASH (209,292) (12,544,474) CASH AT BEGINNING OF YEAR 2,083,156 14,627,630 CASH AT END OF YEAR $ 1,873,864 $ 2,083,156 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Accounts payable converted to long‐term debt $ 4,543,055 $ ‐ Cash paid during the year for income taxes $ 2,334,561 $ 578,952 Cash paid during the year for interest $ 1,130,872 $ 969,323 Assignment of note payable to related party $ ‐ $ 108,862 The accompanying notes are an integral part of these financial statements. 6

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 1 - OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES OPERATIONS Alpha Technologies Services, Inc. specializes in offering engineering, furnishing and installation (EF&I), preventative maintenance, and equipment repair/refurbishment services as well as battery distribution to its customers. Alpha Energy is a division of the company. Alpha Energy is an integrator of Photovoltaic and other distributed generation power systems for residential, small commercial and institutional applications. Alpha Energy may also construct solar power systems for the future sale of alternative energy to customers. Outback Power Technologies, Inc. develops power conversion solutions that provide reliable electric power for renewable energy, backup and mobile applications. Alpha Alternative Energy, Inc. provides engineering, procurement, and construction (EPC) as well as operations and maintenance (O&M) services to developers and operators of photovoltaic (PV) power generation systems. Coppervale Enterprises, Inc. provides energy‐related business intelligence, delivered through financial, energy and environmental auditing and analytics. The work is performed under contracts with a fixed price or cost plus a profit sharing fee with a guaranteed maximum. Alpha Broadband Services, Inc. is a customer service organization that was created to provide on‐ site power services including power system installation, preventative maintenance and technical support to customers. NavSemi Energy Pte. Ltd. develops off‐grid and grid‐interactive power solutions for a more efficient transfer of energy from solar power sources and provides first‐in‐kind solutions for expanding solar capabilities. Alpha Technologies Pty. Ltd. provides end to end sales, service and support to customers for a complete range of integrated powering solutions. Alpha Innovations Indústria E Comércio De Produtos Electrônicos Ltda. (Alpha Innovations Pty. Ltd.) provides manufacturing and technical support for Alpha products in the industrial and telecommunications field. Alpha Innovations Mexico S. de R.L. de C.V. (Alpha Innovations Mexico) provides end to end sales, service and support to customers for a complete range of integrated powering solutions. The companies operate throughout the United States, as well as provide services to entities in foreign markets. PRINCIPLES OF CONSOLIDATION The accompanying consolidated financial statements include the accounts of Alpha Technologies Services, Inc., its wholly owned subsidiaries Outback Power Technologies, Inc. Alpha Alternative Energy, Inc., Coppervale Enterprises, Inc., Alpha Broadband Services, Inc., NavSemi Energy Pte. Ltd., Alpha Technologies Pty. Ltd., Alpha Innovations Pty. Ltd. Alpha Innovations Mexico S. de R.L. de C.V. 7

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements (collectively "the company"). All significant intercompany accounts and transactions have been eliminated in consolidation. USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and 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. Actual results could differ from those estimates. CONCENTRATIONS OF CREDIT RISK The company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Additionally, the company maintains money market accounts which are not insured. The company has not experienced any losses in such accounts. The company believes it is not exposed to any significant credit risk on cash. The company grants credit to its customers, some of which are located in foreign markets. Such receivables are generally unsecured. CASH MANAGEMENT The company reduces its cash balance when checks are disbursed. Due to the time delay in checks clearing the bank, the company may maintain a negative cash balance on its books, which is reported as a liability in the accompanying financial statements. Checks issued in excess of bank balance includes $950,032 and $600,270 of checks not yet presented for payment drawn in excess of cash balances at December 31, 2017 and 2016, respectively. INVENTORY The company adopted the provisions of FASB ASU 2015‐11, Inventory (Topic 330): Simplifying the Measurement of Inventory. The provisions of ASU 2015‐11 require inventory, for which cost is measured using a method other than the LIFO or retail method, to be subsequently measured at the lower of cost or net realizable value. The adoption of these provisions have been prospectively applied and did not have a material impact on the accompanying financial statements. Supplies and parts, solar panels and finished goods inventory is based on a physical count and stated at the lower of cost, using a standard costing system, or net realizable value. Finished goods include costs for direct labor, materials and allocated production overhead. Battery inventory is based on physical count and stated at the lower of cost, using the moving average cost method, or net realizable value. DEPRECIATION AND AMORTIZATION Depreciation of property and equipment is provided on the straight‐line method using the following estimated useful lives: Solar power systems 25 years Machinery and equipment 3‐7 years Motor vehicles 3‐5 years Furniture and office equipment 3 years 8

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Leasehold improvements are being amortized using the straight‐line method over the lesser of the estimated length of the related lease or estimated useful life of the asset. Costs related to long‐term capital asset projects are recorded as assets under construction. Once the underlying project is complete and the asset is placed in service, the costs will be depreciated. INVESTMENTS The company owns a 10% membership interest in Silicon Energy, LLC. During 2016, the company owned a 2% interest in Mojo Networks, Inc. (formally known as AirTight Networks, Inc.). During 2017, the company purchased additional stock in Mojo Networks, Inc. for $1,182,421 which increased the company's interest in Mojo Networks, Inc. to 3.2205%. These investments are accounted for using the cost method. The company periodically evaluates their investment for potential impairment. An impairment loss would be recognized as the amount by which the cost of the investments exceeds the fair market value. INTANGIBLE ASSETS Amortization of intangible assets is provided on the straight‐line method using the following expected benefit period: Non‐compete agreement 5 years GOODWILL The excess of the purchase price over the fair market value of intangible assets, tangible assets and assumed liabilities in a business combination is allocated to goodwill. Goodwill is analyzed upon the occurrence of events or circumstances indicating that an impairment may exist. Impairment losses, if any, are recorded in the consolidated statement of income as part of income from operations. The company has adopted the provisions of FASB ASC 350‐20, Goodwill and Other. The provisions allow for the company to assess qualitative factors to determine whether it is more likely than not that evidence of goodwill impairment exists. The company has adopted the accounting alternative provisions of FASB ASC 350‐20, Goodwill and Other, relating to the subsequent measurement of goodwill. Under the alternative provisions of ASC 350‐20, goodwill is amortized on a straight‐line basis over the shorter of the estimated useful life or ten years (Note 7). Goodwill is amortized on a straight‐line basis over ten years. WARRANTIES The company records a liability for an estimate of costs that it expects to incur under its basic limited warranty when product revenue is recognized. Factors affecting the company's warranty liability include the number of units sold and historical and anticipated rates of claims and costs per claim. The company periodically assesses the adequacy of its warranty liability based on changes in these factors. 9

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements FOREIGN OPERATIONS The accounting records of NavSemi Energy Pte. Ltd. are maintained in the local currencies of the Republic of India (Rupee) and Singapore (Singapore dollar). The accounting records of Alpha Technologies Pty. Ltd. are maintained in the local currency of Australia (AUD). The accounting records of Alpha Innovations Pty. Ltd. are maintained in the local currency of the Federature Republic of Brazil (Real). The accounting records of Alpha Innovations Mexico are maintained in the local currency of Mexico (Peso). Accounting standards require the financial statements of these foreign subsidiaries, be remeasured into U.S. dollars (reporting currency). The accompanying financial statements include amounts attributable to the foreign subsidiaries that have been translated into U.S. dollars using an average annual exchange rate for the statement of income, the exchange rate at December 31, 2017 and 2016 for the balance sheet, and the historical exchange rate for equity transactions. Exchange gains and losses from remeasurement into the reporting currency are recognized as a component of other comprehensive income. Foreign operations related to foreign subsidiaries consist of net sales equivalent to approximately $10,946,000 and $8,348,000 and a net loss of approximately $1,958,000 and $1,292,000 for the years ended December 31, 2017 and 2016, respectively. Assets located outside of the United States totaled approximately $9,967,000 and $7,104,000 at December 31, 2017 and 2016, respectively. Foreign operations are subject to risks inherent in operating under different legal systems and various political and economic environments. Among the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price or foreign exchange controls and restrictions on currency exchange. NON-CONTROLLING INTEREST Non‐controlling interest on the consolidated balance sheet, and consolidated statements of income and comprehensive income and stockholder's equity and comprehensive income represents the minority owner's proportionate share of equity and loss of NavSemi Energy Pte. Ltd. During 2016, the company purchased the remaining shares of NavSemi Energy Pte. Ltd. from the minority stockholder (Note 20). REVENUE RECOGNITION Revenue for the sale of finished goods, batteries and certain solar panels is recognized upon shipment of products to customers when all significant contractual obligations have been satisfied and collection is reasonably assured. Service and repair revenue is recorded as customers are invoiced for work performed. Revenue from software licensing agreements is recognized over the length of the contract, typically one to three years. Revenue from utility audits, carbon audits and other energy management services is recognized when earned which is when the company has persuasive evidence of an arrangement, services have been performed, the sales price has been fixed or determinable and collectability is reasonably assured. Revenues from fixed price contracts are recorded on the basis of management's estimates of the percentage‐of‐completion of individual contracts, commencing when progress reaches a point where experience is sufficient to estimate final results with reasonable accuracy. Management's estimates of the percentage‐of‐completion of individual contracts are based primarily upon the 10

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements relationship of costs incurred to date compared with total estimated costs. Estimated total cost is a significant estimate which affects the recognition of contract profit or loss for each contract. Changes in job performance, job conditions and estimated profitability may result in revisions to costs and revenues in the succeeding year. Because of the inherent uncertainties in estimating costs, it is at least reasonably possible that the estimates used will change in the near term. Revisions in cost and profit estimates during the course of the work are reflected in the accounting period in which the facts which require the revisions become known. When it becomes apparent that a loss on a contract will be incurred, the entire estimated loss is recorded. Work performed under fixed price contracts are generally less than one year in duration. Contract costs include all direct materials, subcontractor and labor costs, and those indirect costs related to contract performance, such as equipment rental, supplies, tools and repairs. Included in inventory are certain direct solar panel and product materials purchased but not yet installed and charged to the job. General and administrative costs are charged to expense as incurred. Unbilled receivables represent revenues earned in excess of amounts billed. Deferred revenue represents amounts invoiced or collected in excess of revenues recognized. FAIR VALUE OF FINANCIAL INSTRUMENTS The company estimates that the carrying amount of all financial instruments approximate fair value, a Level 1 input under ASC 820. SHIPPING AND HANDLING COSTS The company classifies shipping and handling as operating expenses in the accompanying consolidated financial statements. Total shipping and handling costs were approximately $2,160,000 and $2,816,000 for the years ended December 31, 2017 and 2016, respectively. TAXES COLLECTED FROM CUSTOMERS AND REMITTED TO GOVERNMENTAL AUTHORITIES The company accounts for the collection and remittance of all taxes on a net basis. As a result, these amounts are not reflected in the consolidated statement of income and comprehensive income. NEW ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU 2014‐09, Revenue from Contracts with Customers. In general, this standard will require the company to recognize revenue when it transfers goods or services to customers in the amount of anticipated consideration in which the company is entitled. This standard also requires additional disclosure requirements that result in the company providing financial statement users comprehensive information regarding the nature, amount, timing and uncertainty of revenue and cash flow from the company's contracts with customers. This standard will be effective for the calendar year ending December 31, 2019 with retrospective application required. The company has not determined the impact of adopting this standard on the accompanying financial statements. In February 2016, the FASB issued ASU 2016‐02, Leases. In general, this standard requires a lessee to record a right‐of‐use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. This standard will be effective for the calendar year ending December 31, 2020 with retrospective application required. The company has not determined the impact of adopting this standard on the accompanying financial statements. 11

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 2 - RECEIVABLES Receivables are stated at the amount management expects to collect from outstanding balances. Management provides for probable uncollectible amounts through a charge to income and an increase in the valuation allowance based on its assessment of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the valuation allowance and a reduction of accounts receivable. Receivables at December 31 consists of the following: 2017 2016 Receivables $ 60,543,592 $ 50,368,695 Less allowance for doubtful accounts (1,261,707) (1,293,898) Receivables, net $ 59,281,885 $ 49,074,797 Amounts due from two customers comprise 68% and 49% of receivables at December 31, 2017 and 2016, respectively. Note 3 - INVENTORY Inventory at December 31 consists of the following: 2017 2016 Batteries $ 6,896,504 $ 5,692,626 Supplies and parts 6,441,587 5,806,588 Finished goods 2,095,203 795,498 Solar panels 311,853 208,760 Less allowance for inventory obsolescence (1,053,000) (1,346,501) Total $ 14,692,147 $ 11,156,971 Note 4 - CONTRACTS IN PROGRESS Information with respect to contracts in progress at December 31 is as follows: 2017 2016 Costs incurred on contracts in progress $ 32,233,972 $ 40,194,892 Estimated gross profit 7,249,202 3,999,293 Earned revenue 39,483,174 44,194,185 Less billings to date (35,351,382) (40,012,607) Unbilled receivables, net $ 4,131,792 $ 4,181,578 12

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Backlog on contracts in progress was $21,646,329 and $12,520,270 at December 31, 2017 and 2016, respectively. Note 5 - PROPERTY AND EQUIPMENT Property and equipment at December 31 consists of the following: 2017 2016 Solar power systems $ 4,260,608 $ 4,260,608 Machinery and equipment 3,792,265 2,791,994 Leasehold improvements 2,004,966 1,990,354 Assets under construction 693,593 148,063 Motor vehicles 650,434 307,679 Furniture and office equipment 552,973 456,683 Total property and equipment, at cost 11,954,839 9,955,381 Less accumulated depreciation and amortization (4,863,375) (4,096,902) Net property and equipment $ 7,091,464 $ 5,858,479 The accompanying consolidated financial statements include depreciation expense of $680,932 and $589,322 related to property and equipment for the years ended December 31, 2017 and 2016, respectively. Depreciation and amortization expense related to property and equipment totaled $883,960 and $795,627 for the years ended December 31, 2017 and 2016, respectively. Note 6 - INTANGIBLE ASSETS Intangible assets at December 31 consist of the following: 2017 2016 Non‐compete agreement $ 144,078 $ ‐ Less accumulated amortization (7,722) ‐ Intangible assets, net $ 136,356 $ ‐ The company incurred amortization expense of $7,722 for the year ended December 31, 2017. Future estimated amortization expense related to intangible assets is as follows: Year ending December 31, 2018 $ 28,816 2019 28,816 2020 28,816 2021 28,816 2022 21,092 13

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 7 - GOODWILL The change in the carrying value of goodwill during the year ended December 31 is as follows: 2017 2016 Carrying value, beginning of period $ 9,938,345 $ 11,552,303 Amortization expense (1,613,958) (1,613,958) Carrying value, net, end of period $ 8,324,387 $ 9,938,345 Goodwill at December 31 consists of the following: 2017 2016 Goodwill $ 16,139,567 $ 16,139,567 Less accumulated amortization (7,815,180) (6,201,222) Net goodwill $ 8,324,387 $ 9,938,345 Future estimated amortization expense of goodwill is $1,613,958 for each of the next five years. Note 8 - LINE OF CREDIT The company maintains a $15,000,000 revolving line of credit agreement with Bank of America, N.A. which is based on eligible collateral. The interest rate was 3.06% at December 31, 2017 and varies at the LIBOR Daily Floating Rate plus 1.50%. The line of credit matures January 31, 2019 and is collateralized by substantially all company assets. The outstanding balance was $771,819 and $8,104,499 at December 31, 2017 and 2016, respectively. The line of credit includes provisions for standby letters of credit. The maximum amount of all letters of credit, including any partial draws under the letters of credit, is limited to $3,000,000 and have terms not to exceed 365 days beyond the maturity of the line of credit. There was $2,400,000 in letters of credit outstanding at December 31, 2016. There were no letters of credit outstanding at December 31, 2017. The line of credit agreement contains covenants which require the company to maintain certain financial ratios. The company was in compliance with the financial covenants at December 31, 2017. Note 9 - WARRANTY PROVISION The company maintains a warranty provision on certain product sales for a maximum period of five years from completion of the work. The company recognizes warranty expense for claims incurred and estimated future claims. Approximate warranty costs at December 31 are as follows: 14

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements 2017 2016 Balance, beginning of year $ 948,000 $ 843,000 Claims paid during the year (193,000) (163,000) Additional warranties issued 126,000 268,000 Balance, end of year $ 881,000 $ 948,000 Note 10 - LONG-TERM DEBT Long‐term debt at December 31 consists of the following: 2017 2016 Note payable to Altair Advanced Industries, Inc., 6%, due in monthly installments of $201,351 including interest, matures March 2019 with option to extend for one additional year, unsecured $ 2,715,964 $ ‐ Less current portion (2,316,263) ‐ Long‐term portion $ 399,701 $ ‐ Future payments to be made on long‐term debt are as follows: Year ending December 31, Principal Interest Total 2018 $ 2,316,263 $ 99,949 $ 2,416,212 2019 399,701 3,000 402,701 Total $ 2,715,964 $ 102,949 $ 2,818,913 Note 11 - NOTES PAYABLE TO RELATED PARTIES Notes payable to related parties at December 31 consists of the following: 2017 2016 Outback Power Technologies, Inc. Note payable to Alpha Technologies, Inc., 5%, interest payments due annually, principal and accrued interest due June 2019, unsecured, subordinated to Bank of America, N.A. $ 10,000,000 $ 10,000,000 Coppervale Enterprises, Inc. Note payable to Alpha Technologies, Inc., 5%, interest payments due annually, principal and accrued interest due July 2019, unsecured, subordinated to Bank of America, N.A. 400,000 400,000 15

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements NavSemi Energy Pte. Ltd. Revolving note payable to Alpha Technologies, Inc., 5%, maximum principal sum of $1,500,000 available at December 31, 2017, interest payments due annually, principal and accrued interest due December 2020, unsecured 1,340,000 425,000 Alpha Innovations Pty. Ltd. Notes payable to Alpha Technologies, Inc., 5%, interest payments due annually, principal and accrued interest due on maturity dates ranging from May 2018 to August 2019, unsecured 4,425,833 3,386,491 Alpha Innovations Mexico Revolving note payable to Alpha Technologies, Inc., 5%, maximum principal sum of $100,000 available at December 31, 2017, interest payments due annually, principal and accrued interest due November 2018, unsecured 49,314 ‐ Total notes payable to related parties 16,215,147 14,211,491 Less current portion (2,325,167) ‐ Long‐term portion $ 13,889,980 $ 14,211,491 The accompanying financial statements include interest payable of approximately $331,000 and $263,000 and interest expense of approximately $749,000 and $674,000 related to these notes for the years ended December 31, 2017 and 2016, respectively. Future payments to be made on notes payable to related parties are as follows: Year ending December 31, Principal Interest Total 2018 $ 2,325,167 $ 746,844 $ 3,072,011 2019 12,549,980 686,166 13,236,146 2020 1,340,000 67,000 1,407,000 Total $ 16,215,147 $ 1,500,010 $ 17,715,157 Subsequent to December 31, 2017, the maximum principal amount available under the NavSemi Energy Pte. Ltd. revolving note payable to Alpha Technologies, Inc. was increased to $2,250,000. 16

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 12 - FEDERAL AND STATE TAXES ON INCOME The company has adopted the provisions of FASB ASC 740‐10, Income Taxes, relating to accounting for uncertain tax positions. ASC 740‐10 defines a recognition threshold and measurement process for accounting for uncertain tax positions and also provides guidance on various related matters such as interest, penalties, derecognition and disclosures. The company does not have any entity level uncertain tax positions. The company files income tax returns in the U.S. federal jurisdiction and various state jurisdictions. The company is no longer subject to U.S. federal or state and local income tax examinations by tax authorities for years before 2014. The company utilizes the asset and liability method of accounting for deferred income taxes. Under this method, the current year deferred income tax expense or benefit is determined by the net change in the deferred tax liabilities or assets during the year. The deferred tax liabilities or assets are determined by comparison of the financial statement bases of all assets and liabilities to their corresponding tax bases and applying enacted tax rates to these temporary differences. The company has early adopted the provisions of FASB ASU 2015‐17, Income Taxes. The provisions of ASU 2015‐17 simplified the presentation of deferred income taxes which required that deferred tax liabilities and assets be classified as noncurrent in a classified balance sheet. The adoption of this ASU was retrospectively applied. The adoption of this standard did not have a material impact on the accompanying financial statements. The Tax Cuts and Jobs Act of 2017 was signed into law on December 22, 2017. The law includes significant changes to the U.S. corporate income tax system, including a federal corporate rate reduction from 35% to 21% and a transition of U.S. International taxation from a worldwide tax system to a territorial tax system. As a result of the federal corporate rate reduction, the company has revalued their deferred assets and liabilities and recorded tax expense of $226,000, which is included in deferred tax expense (benefit) as of December 31, 2017. The company is in the process of analyzing the final legislation and has not determined the impact of the transition tax on deemed repatriation of deferred foreign income. Financial statement bases and tax bases of assets differ due to the company utilizing accelerated depreciation methods for tax purposes on certain assets which are being depreciated less rapidly for financial statement purposes, the use of allowances for financial statement purposes, and other timing differences. These approximate temporary differences at December 31 are summarized as follows: 2017 2016 Deferred tax asset Capital loss carryforwards, expiring in 2020 $ 1,027,000 $ ‐ Difference in financial statement bases of goodwill over tax bases 372,000 586,000 Financial statement inventory reserve 256,000 441,000 Financial statement allowance for doubtful accounts 222,000 444,000 Financial statement accrual of bonuses and vacation 160,000 332,000 17

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Financial statement warranty reserve 67,000 140,000 Financial statement deferred rent 36,000 81,000 Financial statement provision for losses on contracts in progress 5,000 54,000 Total deferred tax asset 2,145,000 2,078,000 Less valuation allowance (1,027,000) ‐ Net deferred tax asset $ 1,118,000 $ 2,078,000 Deferred tax liability Excess of financial statement bases of property and equipment over tax bases (751,000) (1,172,000) Total net deferred tax asset $ 367,000 $ 906,000 Realization of the deferred tax assets is dependent on generating sufficient taxable income. A valuation allowance of $1,027,000 has been recorded based on management's evaluation that it is more likely than not that the benefit from the capital loss carryforwards will not be realized. Although realization is not assured, management believes, based upon available information, it is more likely than not that the net deferred assets will be realized in the normal course of operations. The amount of the net deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future income are reduced. Federal and state income tax expense does not bear a normal relationship to income before taxes primarily due to the effects of general business credits, the change in the effective rate and nondeductible items for federal income tax purposes. Effective January 1, 2017, the company made a check the box election to classify NavSemi Energy Pte. Ltd. as a disregarded entity and include the results of operations in the consolidated tax return. Alpha Technologies Pty. Ltd., Alpha Innovations Pty. Ltd. and Alpha Innovations Mexico are treated as controlled foreign corporations under the Internal Revenue Code. As such, each subsidiary pays taxes in accordance with its local tax law. Note 13 - REVENUE Two customers comprised approximately 64% of the company's revenues for the year ended December 31, 2017. Three customers comprised approximately 57% of the company's revenue for the year ended December 31, 2016. Note 14 - SUPPLIER CONCENTRATION The company obtained approximately 13% of its inventory purchases from one supplier during each of the years ended December 31, 2017 and 2016. Management believes other suppliers could provide similar products on comparable terms. A change in suppliers, however, could cause a delay in shipping and a possible loss of sales, which could affect operating results adversely. 18

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 15 - LEASE COMMITMENTS The company leases service depot facilities in Washington, Arizona, Florida, Georgia, New Jersey, and Texas and warehouse facilities in New Mexico, from various parties. The leases expire from October 2018 to March 2027. The leases currently call for combined monthly payments of approximately $88,000, with scheduled annual increases. The company is responsible for all expenses related to occupancy including taxes, insurance, utilities and maintenance. Under the terms of the lease for facilities in Arlington, Washington, the company received $300,000 in rent abatement from February 2013 through September 2014. The lease also calls for scheduled rent increases. Accounting principles generally accepted in the United States of America require lease payments to be recognized on a straight‐line basis over the term of the lease. The difference between the actual lease payments and the amount that is required to be recognized as expense is recorded as deferred rent on the consolidated balance sheet. NavSemi Energy Pte. Ltd. leases office and warehouse facilities in Bangalore, India, under operating agreements expiring through April 2021. The leases currently call for combined monthly rental payments of approximately $8,000 with scheduled annual increases. The company is responsible for all expenses related to occupancy including taxes, insurance, utilities and maintenance. During 2017, Alpha Innovations Mexico entered into an operating agreement to lease office space in Toluca, Mexico, expiring January 2020. The lease calls for monthly payments of approximately $1,000. The company is responsible for all expenses related to occupancy, including taxes, insurance, utilities and maintenance. The company leases vehicles under noncancellable operating leases with terms ranging from 24 months to 48 months. The leases currently call for combined monthly payments of approximately $14,000. The accompanying consolidated financial statements include total rent expense of approximately $1,547,000 and $1,741,000 relating to these leases for the years ended December 31, 2017 and 2016, respectively. Future minimum lease payments under noncancellable leases are as follows: Year ending December 31, 2018 $ 1,497,691 2019 1,327,507 2020 1,126,847 2021 543,997 2022 190,162 Thereafter 618,175 Total $ 5,304,379 19

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements Note 16 - EMPLOYEE BENEFIT PLAN The company participates in a defined contribution profit‐sharing plan, including 401(k) provisions, covering qualified employees which allows for contributions by the company and voluntary contributions by employees. The company matches 50% of employee contributions to the plan limited to a match of $5,000 per eligible employee. Employer contributions to the plan were approximately $227,000 and $237,000 for the years ended December 31, 2017 and 2016, respectively. Note 17 - RELATED PARTY TRANSACTIONS The company maintains the following service agreements with Alpha Technologies, Inc. (ATI) and Comm/Net, Inc. (CNN) for general management support and product management support, respectively, to the company: a) Management Support Services Agreement between ATI and Alpha Technologies Services, Inc. effective as of July 1, 2000, and amended on January 8, 2016 with an effective date of January 1, 2016. b) Management Support Services between ATI and Outback Power Technologies, Inc. effective as of July 13, 2010, and amended January 14, 2014 with an effective date of January 1, 2014. c) Product Management Services Agreement between CNN and Alpha Technologies Services, Inc. effective as of January 1, 2002, and amended January 8, 2016 with an effective date of January 1, 2016. d) Management Support Services Agreement between ATI and Coppervale Enterprises, Inc. effective as of January 1, 2010. e) Management support services agreement between ATI and Alpha Innovations Mexico effective as of January 1, 2017. The agreements continue for successive yearly terms. Either party may terminate the agreements at any time upon 90 days written notice. Total management fees paid during the year in relation to the above agreements were $22,450,865 and $17,071,708 for the years ended December 31, 2017 and 2016, respectively. At December 31, 2017 and 2016, $486,305 and $489,857, respectively, is due from ATI and CNN and is included in accounts receivable. At December 31, 2017 and 2016, $19,874,141 and $11,566,156, respectively, is due to ATI and CNN and is included in accounts payable. During the years ended December 31, 2017 and 2016, the company recorded revenues of approximately $1,713,000 and $1,933,000, respectively, for services provided to Alphatec Ltd., the stockholder. At December 31, 2017 and 2016, $52,773 and $262,595, respectively, is due from Alphatec Ltd., and is included in accounts receivable. 20

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements During the year ended December 31, 2016, the company sold approximately $199,000 of equipment to ATI. These related party transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties. The balances outstanding are unsecured, non‐interest bearing have no stated terms of repayment and have arisen as a result of services referred to above. Note 18 - OTHER INCOME Between 2009 and 2013, the company completed the installation of several company‐owned solar panel systems. These solar panel systems are considered renewable energy systems. Under federal law, there are certain environmental credits associated with each kilowatt‐hour (kWh) of electricity produced by the solar panel systems. Under the terms of the sale and installation agreements, the company has assigned title and ownership of any and all environmental credits associated with the solar panel systems to certain utility agencies in exchange for one time incentive payments. The incentive payments related to the assignment of these rights totaled $83,655 and $79,196 in 2017 and 2016, respectively. Under terms of the sale agreements, the company must maintain and operate the solar panel systems for 20 years. If the systems are not appropriately maintained, the company could be charged penalties and damages by the utility agencies. Note 19 - EMPLOYEE AGREEMENTS The company maintains a Supplemental Executive Bonus Plan (the "plan") for key employees. Admittance into the plan is at management's discretion. Contributions to the plan are based on an annual bonus amount that varies by participant (as defined in the plan) and subject to continued employment by the key employee, vesting requirements and continuation of the plan at the discretion of the company. Contributions are paid out to participants following a five year vesting period and before the due date of the company's federal income tax return. At December 31, 2017 and 2016, the deferred compensation liability related to this agreement was $90,000 and $308,000, respectively Note 20 - BUSINESS COMBINATIONS On December 2, 2016, Alpha Technologies Services, Inc. acquired 100% of the outstanding shares of Coppervale Enterprises, Inc., a company incorporated in Washington from a related party. The purchase price was $1,600,000 paid at closing. The acquisition was made for the purpose of expanding current services to include energy‐related consulting services to their existing customer base. The accompanying financial statements include the results of operations for the years ending December 31, 2017 and 2016. 21

Alpha Technologies Services, Inc. Notes to Consolidated Financial Statements The following is a condensed balance sheet showing the fair value of assets acquired and liabilities assumed as of the beginning of the period, January 1, 2016: Cash $ 86,907 Receivables 121,797 Accounts payable (138,899) Other current liabilities (109,510) Notes payable (300,000) Net liabilities assumed $ (339,705) A loss in the amount of $1,939,705 was recognized as a result of the acquisition during the year ended December 31, 2016. On October 10, 2016, Alpha Technologies Services, Inc. acquired the remaining outstanding shares of NavSemi Energy Pte. Ltd., The additional purchase price was $190,900 paid at closing. A loss of $632,136 was recognized as a result of the acquisition. Note 21 - CONTINGENCIES The company may be involved in various legal matters and subject to certain contingencies in the normal course of business, some of which are covered by insurance. Management believes that the outcome of any matters will not have a material impact on the company's financial position. Note 22 - SUBSEQUENT EVENTS Effective April 10, 2018, NavSemi Energy Pte. Ltd. changed its name to Alpha Tech Energy Solutions India Pte. Ltd. Management has evaluated subsequent events through April 27, 2018, the date the financial statements were available to be issued. 22