Company: WKSP
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000850
Chunk: 99

Company: Worksport Ltd
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1
Chunk 99
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 stored energy capacity and price point but also to upgrade their COR system over time based on their evolving
needs.

Supply
of Components

Production
of our soft and hard cover product lines requires components including but not limited to injection molded plastics, rubber hinges, rubber
seals, foam corners, aluminum coils, aluminum extrusions, and metal brackets. For raw materials that are manufactured by third parties
per our specifications and designs, we believe we have the proper network, team, and purchasing/stocking strategy to readily source such
materials from alternative suppliers for domestic tonneau cover production without major delays in production.

13

For
our domestically assembled products, we have developed an extensive network of suppliers based in a diverse range of countries, including
but not limited to the U.S., China, Romania, Türkiye, and Canada, and we are continuously working to further diversity our supply
chain and network of suppliers to mitigate supply chain risks . For our COR and SOLIS components, we are establishing relationships
with suppliers based in countries, including but not limited to the U.S., Canada, China, Germany, Romania, Türkiye, Philippines,
and India . We actively seek to lower reliance on any country deemed a potential geo-political supply chain risk.

Research
and Development

We
invest in research and development activities on an ongoing basis; we are actively acquiring new engineering and design assets. Our design
engineers are based in the United States, and they have developed and are further developing unique tonneau cover designs with enhanced
user experience, cost-effective and sustainable materials, and automatable manufacturing potential. Additionally, we work with research
and development consultants from other countries including Canada. We allocate resources to support the continued development of portable
energy storage and home heating solutions that are competitive in the market and efficiently produced to maximize profitability.

Governmental
Programs, Incentives and Regulations

Globally,
both the operation of our business and the ownership of our products by our customers are impacted by various government programs, incentives,
and other arrangements. Our business and products are also subject to numerous governmental regulations that vary among jurisdictions.

Programs
and Incentives

We
have applied for and been granted tax, mortgage, wage, and energy cost relief in New York in addition to wage cost and R&D cost relief
in Ontario. These programs are provided by several agencies including the Erie County Industrial Development Agency, Empire State Development,
NY Power Authority, and The Canada Revenue Agency. Each of these incentive programs includes its own