MyGrid 1A

Risk: The MYGRID team might not have (proper) knowledge of the market and/or make incorrect forecasts.

Consequence: If the team does not have sufficient knowledge of the market, it could set incorrect targets. This could lead to a lower valuation in the event of a possible exit because the business plan could not be executed as planned. In that case, there could be lower or even non-existent returns. In the worst case, there could even be a liquidation and bankruptcy of MYGRID, with partial or complete loss of the invested capital.

Note: MYGRID has completed the Start It @ KBC accelerator program and is also coached in the Mentor Me program by Netwerk Ondernemen.

Risk: Given the stage of development that project owner is in, it is likely that there will be a need for new financing.

Consequence: On the one hand, there is the risk that the company will not find investors, which would lead to the dissolution or bankruptcy of the company, causing the investor to lose part or all of his investment. On the other hand, there is the possibility that the company will find new investors, which will lead to dilution, which will be even greater if there is a lower valuation than the one currently used.

Note: Investors will have the opportunity to co-invest in new rounds, at the then current investment terms if new investors are found. In addition, MYGRID will seek professional financial advice to ensure adequate capital reserves and contingency plans in case of unexpected financial challenges.

Risk: MYGRID brings a technological product to the market, which presents development challenges.

Consequence: There may be delays in product development, increased costs and possibly ultimately no functional and competitive product.

Note: MYGRID will conduct thorough research and development, engage experienced engineers, and it will regularly test prototypes to address technological challenges. It will consider contingency plans in case of unforeseen technical obstacles.

Risk: Established players may compete with MYGRID and similar products may be developed.

Consequence: If this risk occurs, MYGRID may struggle to gain market share. This could lead to a lower valuation in the event of a possible exit because the business plan could not be executed as planned. In that case, there could be lower or even non-existent returns. In the worst case, there could even be a liquidation and bankruptcy of MYGRID, with partial or complete loss of the invested capital.

Note: MYGRID conducts a comprehensive market analysis to identify unique selling points and competitive advantages. It will develop a strong marketing and sales strategy to differentiate the product from competitors and it constantly monitors the market and will adjust the product or marketing approach accordingly.

Risk: MYGRID depends on suppliers to manufacture the product. Thus, there is a risk linked to supply chain failures and/or shortages of key components.

Consequence: There may be delayed production and higher costs, leading to possible customer dissatisfaction.

Note: MYGRID diversifies the supply chain by sourcing from multiple suppliers and regularly assesses their reliability. It will develop contingency plans to address potential interruptions, such as alternative sourcing options or buffer stocks. It will ensure open communication with suppliers and proactively address potential issues.

Risk: Given the industry in which MYGRID operates, it must comply with legal requirements and security standards. There is a risk that MYGRID may (unintentionally) fail to comply with these legal requirements and/or security standards.

Consequence: If this risk occurs, there may be legal sanctions, products may be recalled. There may also be reputational damage and barriers to market entry. This could lead to a lower valuation in the event of a possible exit because the business plan could not be executed as planned. In that case, there could be lower or even non-existent returns. In the worst case, there could even be a liquidation and bankruptcy of MYGRID, with partial or complete loss of the invested capital.

Note: MYGRID will always seek to thoroughly understand and comply with relevant regulations and safety standards for plug-in home batteries. It will engage legal experts or consultants to ensure compliance. It will conduct rigorous testing and certification processes to meet regulatory requirements. It will also keep abreast of changing regulations and make necessary adjustments by working closely with Synergrid.

Risk: The risk of insolvency means that MYGRID does not have sufficient funds to meet its payment deadlines (cessation of payments).

Consequence: If the company does not find alternative financing (shocked credit), it may go bankrupt. The insolvency or bankruptcy of MYGRID may lead to lower or non-existent returns and in the worst case to a partial or total loss of the invested capital.

Risk: Neither the shares of MYGRID nor the Participatory Notes of the MYGRID 1A compartment of Spreds Finance provide guarantees of a return or repayment of the invested capital.

Risk: Participatory Notes do not offer a fixed return. The return of the Participatory Notes depends solely on the performance of the Underlying Asset, namely the shares of MYGRID.

Consequence for both risks: If the project owner's predictions do not come true (within the predetermined timing), there is a risk of lower or non-existent returns and, in the worst case, partial or complete loss of the invested capital.

Note for both risks: Investors in Participatory Notes bear the same economic risk as if they were investing directly as shareholders of MYGRID.

Risk: Although each Spreds Finance compartment is ‘bankruptcy remote’ (meaning that no other creditor can claim a right on or against this compartment) in relation to the others and in relation to the ‘general’ liabilities of Spreds Finance itself, as a result of (i) the terms and conditions of the Notes, (ii) the articles of association of Spreds Finance and (iii) Article 4 of the Law of 18 December 2016 on crowdfunding; there is a subsidiary risk of insolvency of Spreds Finance.

Consequence: Should such insolvency occur, Noteholders may be exposed to the risk of a significant delay in the recovery of their investment.

Note: The probability of this risk occurring is extremely low given the structure and organization of Spreds Finance, in particular the compartmentalization mechanism and the "bankruptcy-remoteness" described above. Each participation taken or loan granted to a project owner is recorded in a separate compartment and is appropriately accounted for in the accounts, taking into account the fact that the accounts are kept by compartment. As a result of (i) the conditions attached to the issue of Participatory Notes, (ii) the articles of association of Spreds Finance and (iii) article 10 of the law regulating the recognition and delimitation of crowdfunding and containing various provisions relating to finance and notwithstanding articles 7 and 8 of the Mortgage Law of 16 December 1851, the assets of a particular compartment serve exclusively to guarantee the rights of investors with respect to this compartment.

Risk: Neither the project owner nor Spreds Finance organizes an exchange market for Participatory Notes. It is thus up to the investor himself to find a buyer for his Participating Notes. Given the absence of an exchange market for Participatory Notes, there is no way to adequately establish a comparative pricing methodology for Participatory Notes.

Consequence: A holder of Participatory Notes may not be able to find a buyer for the Participatory Notes it wishes to sell (at the price at which it wishes to sell).

Note: The intention is not to sell the Participatory Notes but to sell the Underlying Asset, often on the occasion of the sale of the Underlying Company itself (see Appendix B, (d)).

Risk: Any decision by Spreds Finance to sell shares of MYGRID is subject to the approval of the holders of Participatory Notes representing at least 75% of the outstanding Participatory Notes, unless Spreds Finance is required to sell them under a contractual or statutory provision.

Consequence: Investors thus bear the risk that the general meeting of the holders of Participatory Notes may refuse to approve the sale of the participation, in which case all investors are bound by this decision and thus must wait to obtain redemption of the Participatory Notes.

Risk: Investing in shares of young companies entails the risk that a buyer for the shares will not be found, or not at a fair price yielding a market return, or that a buyer will not be found within a reasonable period of time.

Consequence: If no buyer is found for the holding, redemption of the Participatory Notes is not possible.

Note: Spreds Finance will make every effort within its powers to obtain the best possible price.

Risk: Spreds Finance has not conducted an analysis of the proposed project or of the financial situation of the Underlying Company.

Consequence: Any investor considering subscribing to Participatory Notes should make its own analysis of MYGRID's solvency, activity, financial situation and prospects.

Note: Any decision to invest in Participatory Notes should be based on a comprehensive analysis of the project and of this sheet of essential investment information. Spreds Finance's model does not provide for the presentation of analyzed projects to investors but allows investors to invest based on the information made available to them, after making their own analyses.