10q10k10q10k.net

What changed in SUNation Energy, Inc.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of SUNation Energy, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+270 added−327 removedSource: 10-K (2026-03-23) vs 10-K (2025-04-15)

Top changes in SUNation Energy, Inc.'s 2025 10-K

270 paragraphs added · 327 removed · 141 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

26 edited+13 added−13 removed44 unchanged
Biggest changeThis division offers vertically integrated roofing services alongside our solar and storage options. Thanks to this distinction, our roofing services allow for the diversification of our product offerings, offering our regional business the chance for additional revenue opportunities.
Biggest changeThanks to this distinction, our roofing services allow for the diversification of our product offerings, offering our regional business the chance for additional revenue opportunities. To showcase workmanship and the Company’s commitment to quality, the Company has worked alongside General Aniline & Film (“GAF”), a respected industry leader in the roofing field, to climb up their partnership ranks.
In addition to the development of commercial projects, the Company has worked with stakeholders in the private and public sectors to offer community solar, which distributes the benefits of renewable energy that is produced on larger sites to ratepayers who have opted in at a competitively-priced market rate, as well as shaping policy actions across the local, state, and federal governments that are favorable towards the mass adoption of green technology.
In addition to the development of commercial projects, the Company has worked with stakeholders in the private and public sectors to offer community solar, which distributes the benefits of renewable energy that is produced on larger sites to ratepayers who have opted in at a competitively-priced market rate, as well as shaping policy actions across the local, state, and federal governments that are favorable towards the mass adoption of green energy.
We believe there is a tremendous opportunity for a consolidator to rapidly scale its 7 business and become one of the most recognized brands in the industry through acquiring, integrating, and growing leading local and regional solar sales and installation companies. Leverage and continue to lower our customer acquisition costs through referral programs.
We believe there is a tremendous opportunity for a consolidator to rapidly scale its business and become one of the most recognized brands in the industry through acquiring, integrating, and growing leading local and regional solar sales and installation companies. Leverage and continue to lower our customer acquisition costs through referral programs.
We also compete, on a cost basis, with traditional utilities that supply electricity to our potential customers and 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.
We also compete, on a cost basis, with traditional utilities that supply electricity to our potential customers and with companies that are not regulated like traditional utilities but that 8 have access to the traditional utility electricity transmission and distribution infrastructure pursuant to state and local pro-competitive and consumer choice policies.
We believe that our existing HEC and SUNation portfolio companies form a foundation to drive improved referral performance across the network of companies we acquire, further increasing our referral rates and lowering our overall customer acquisition cost. Continue to grow our operations to achieve economies of scale.
We believe that our existing HEC and SUNation NY portfolio companies form a foundation to drive improved referral performance across the network of companies we acquire, further increasing our referral rates and lowering our overall customer acquisition cost. Continue to grow our operations to achieve economies of scale.
The Company believes that it has historically been best for customers to own their own systems, but recognizes that some customers do not want to own their systems. For customers pursuing the home ownership model, these customers typically pursue loan financing, although a small proportion pay in cash.
The Company believes that it has historically been best for customers to own their own systems, but recognizes that some customers do not want to own their systems. 7 For customers pursuing the home ownership model, these customers typically pursue loan financing, although a small proportion pay in cash.
Government Incentives Federal, state, and local government bodies provide incentives, including rebates, tax credits, and other financial incentives, to catalyze customer acceptance of solar energy as an alternative to utility-provided power. 10 Some of the most significant federal incentives are sourced from the Inflation Reduction Act of 2022 (“IRA”).
Government Incentives Federal, state, and local government bodies provide incentives, including rebates, tax credits, and other financial incentives, to catalyze customer acceptance of solar energy as an alternative to utility-provided power. Some of the most significant federal incentives have been sourced from the Inflation Reduction Act of 2022 (“IRA”).
With scalable shared services (e.g., accounting, HR, policy, marketing, legal, IT), we believe our current approach of organic growth enhanced by acquisitions will lead to profitability and cash generation.
With scalable shared services (e.g., accounting, HR, policy, marketing, legal, IT), we believe our current approach of organic growth enhanced by acquisitions will drive profitability and cash generation.
SUNation Energy, Inc.’s markets are New York, Florida, and Hawaii, and the company operates proudly within three (3) U.S. states. Our primary customers are residential homeowners. We also provide solar energy systems to commercial owners and other municipal customers.
SUNation Energy, Inc.’s markets are New York and Hawaii, and the company operates proudly within two U.S. states. Our primary customers are residential homeowners. We also provide solar energy systems to commercial owners and other municipal customers.
Human Capital As of March 31, 2025, the Company employed 189 people. We consider our relations with our employees to be good. None of our employees are currently represented by a labor union. The Company aims to attract and retain qualified personnel and provides wages and benefits that are competitive locally to reward employees for performance.
Human Capital As of March 1, 2026, the Company employed 164 people. We consider our relations with our employees to be good. None of our employees are currently represented by a labor union. The Company aims to attract and retain qualified personnel and provides wages and benefits that are competitive locally to reward employees for performance.
Residential Customers Agreements The majority of SUNation Energy’s revenue (82% of 2024 consolidated revenue) comes from photovoltaic solar energy systems and batteries for residential homeowners. The size of our residential installations vary by location.
Residential Customers Agreements The majority of SUNation Energy’s revenue (85% of 2025 consolidated revenue) comes from photovoltaic solar energy systems and batteries for residential homeowners. The size of our residential installations vary by location.
As we continue to grow our customer base, we may have new opportunities for incremental revenue generation by cross-selling ancillary market products such as more energy storage and service contracts on orphaned systems (customers whose original solar contractor is no longer in business).
As we continue to grow our customer base, we may have new opportunities for incremental revenue generation by cross-selling 6 ancillary market products such as more energy storage and service contracts on orphaned systems (customers whose original solar contractor is no longer in business or have simply abandoned the local markets).
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 there is no clear dominant or preferred competitor in the markets in which we compete.
Competition In the solar installation market, we compete with companies that offer products like ours. 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 there is no clear dominant or preferred competitor in the markets in which we compete.
Residential solar is a fragmented industry, with over 4,000 contractors nationwide. We believe the Sunrun-Vivint merger in 2020 started an era of consolidation and the positive impact of scale-expansion. According to Wood Mackenzie, as of 2022 Q2, 70%+ of the residential solar market is served by a regional or local installer.
Residential solar is a fragmented industry, with over 4,000 contractors nationwide. We believe the Tesla-SolarCity acquisition in 2016 and the Sunrun-Vivint merger in 2020 started an era of consolidation and the positive impact of scale-expansion. According to Wood Mackenzie, as of 2025 Q4, 75%+ of the residential solar market is served by a regional or local installer.
In 2024, the average system size installed was 6.1 kilowatts for HEC customers in Hawaii and 11.4 kilowatts for SUNation’s regional customers on Long Island, New York. Historically, most residential homeowners have chosen to own their home system rather than pursue a third-party ownership model.
In 2025, the average system size installed was 6.8 kilowatts for HEC customers in Hawaii and 127 kilowatts for SUNation NY’s regional customers on Long Island, New York. Historically, most residential homeowners have chosen to own their home system rather than pursue a third-party ownership model.
Within the industry, these service operations are a unique differentiator that sets the Company apart from its peers as most solar operators in the Company’s key markets do not seek to maintain and/or monitor the performance of existing systems for their customers and/or non-customers. 9 The Company actively services and repairs the systems of competitor systems, as is technically feasible based on component type, age, and staff qualifications and training.
Within the industry, these service operations are a unique differentiator that sets the Company apart from its peers as most solar operators in the Company’s key markets do not seek to maintain and/or monitor the performance of existing systems for their customers and/or non-customers.
We already have what we believe are premier referral rates, with over 50% of installed jobs in 2023 and 2024 coming from referrals or repeat customers.
We already have what we believe are premier referral rates, with approximately 35% of installed jobs in 2025 coming from referrals or repeat customers.
Our chief executive officer grew our New York business into the third largest solar provider in one of the most dynamic markets in the country. Our chief operating officer and chief financial officer is a seasoned leader in the M&A, finance and solar spaces.
Our chief executive officer grew our New York business into the third largest solar provider in one of the most dynamic markets in the country. Our chief operating officer and chief financial officer is a seasoned leader in the M&A, finance, technology and solar markets. We have over 100 years of solar industry experience at the management level.
With over twenty years in business, the Company has found that as other solar providers have exited the market or have gone out of business, there has been ample consumer demand for these types of services, and these operations offer enhanced and diversified revenue opportunities. Competition In the solar installation market, we compete with companies that offer products like ours.
With over twenty years in business, the Company has found that as other solar providers have exited the market or have gone out of business, there has been ample consumer demand for these types of services, and these operations offer enhanced and diversified revenue opportunities. Roofing Roofing is a natural extension of SUNation Energy’s photovoltaic offerings.
Corporate History SUNation Energy is a Delaware corporation originally organized in 1969 that operates directly and through its subsidiaries located in the United States (“U.S.”).
Corporate History SUNation Energy is a Delaware corporation originally organized in 1969 that operates directly and through its subsidiaries located in the United States (“U.S.”). SUNation Energy’s vision is to power the energy transition through grass-roots growth of solar electricity paired with battery storage.
As an experienced operator in the residential solar industry, we have built relationships with these large solar product providers. Seasoned and experienced management team. We have a strong leadership team, with deep experience in residential solar and M&A.
As an experienced operator in the residential and commercial solar industries, we have built relationships with these large solar product providers.
Customers will pay for this amount financed plus a finance charge through a monthly payment to a financing supplier. Under the customer loan scenario, we receive cash payments from the loan company upon completion of various milestones during the installation process. In addition to our residential offerings, the Company has a distinct roofing business within the New York market.
Under the customer loan scenario, we receive cash payments from the loan company upon completion of various milestones during the installation process. In addition to our residential offerings, the Company has a distinct roofing business within the New York market. This division offers vertically integrated roofing services alongside our solar and storage options.
This is an emerging part of the business, but soon we believe we will be able to help homeowners generate ongoing revenue streams by aggregating their batteries into a fleet, thus creating a “virtual power plant” and selling grid services to the utility. We have proprietary technology in this area, strong relationships with regulators and utilities.
In the Hawaiian market we also offer energy management control devices on solar systems that are paired with batteries that help homeowners generate ongoing revenue streams by aggregating their batteries into a fleet, thus creating a “virtual power plant” and selling grid services to the utility. We have proprietary technology in this area, and strong relationships with regulators and utilities.
Pineapple assists customers in obtaining loan financing options through our relationships with diverse funding sources. Under these loan financing agreements, there is typically no down-payment or upfront cost to the homeowner. A “dealer fee” is typically rolled into the principal balance, and that amount is amortized over the tenure of the loan.
The Company assists customers in obtaining loan financing options through our relationships with diverse funding sources. Under these loan financing agreements, there is typically no down-payment or upfront cost to the homeowner. Customers will pay for this amount financed plus a finance charge through a monthly payment to a financing supplier.
The home can continue utilizing the electricity generated by the panels, as well as electricity stored in the battery when the sun is not shining.
The home can continue utilizing the electricity generated by the panels, as well as electricity stored in the battery when the sun is not shining. In addition, the excess production from the panels during the day can be used to recharge a battery that was depleted overnight.
To showcase workmanship and the Company’s commitment to quality, the Company has worked alongside General Aniline & Film (“GAF”), a respected industry leader in the roofing field, to climb up their partnership ranks. Since launch, the Company has reached the upper echelon of GAF installer status tiers and is being recognized for its quality work in the field.
Since launch, the Company has reached the upper echelon of GAF installer status tiers and is being recognized for its quality work in the field.
Removed
On March 28, 2022, the Company completed its previously announced merger transaction with Pineapple Energy LLC (“Pineapple Energy”) in accordance with the terms of that certain Agreement and Plan of Merger dated March 1, 2021, as amended by an Amendment No. 1 to Merger Agreement dated December 16, 2021 (collectively the “merger agreement”), by and among the Company, Helios Merger Co., a Delaware corporation and a wholly-owned subsidiary of the Company (the “Merger Sub”), Pineapple Energy LLC, a Delaware limited liability company, Lake Street Solar LLC as the Members’ Representative, and Randall D.
Added
The Company is a domestic operator and consolidator of residential solar, battery storage, and grid services solutions. Our strategy is focused on acquiring, integrating, and growing leading local and regional solar, storage, and energy services companies nationwide.
Removed
Sampson as the Shareholders’ Representative, pursuant to which Merger Sub merged with and into Pineapple Energy, with Pineapple Energy surviving the merger as a wholly-owned subsidiary of the Company (the “merger”).
Added
Our current business units, Hawaii Energy Connection, LLC (“HEC”), and New York-based subsidiaries, the SUNation entities (collectively, “SUNation NY”) are engaged in the design, installation, and maintenance of solar energy systems across residential, commercial, and municipal sectors. Our team specializes in providing tailored solar solutions that meet the specific energy needs of each client, ensuring both efficiency and sustainability.
Removed
Following the closing of the merger (the “Closing”) the Company changed its name from Communications Systems, Inc. to Pineapple Holdings, Inc. and commenced doing business using the Pineapple name, and subsequently, on April 13, 2022, changed its name to Pineapple Energy Inc.
Added
In addition to our core solar services, we also offer energy storage systems to optimize energy use and increase reliability. Our New York business unit further integrates a broader range of services, including residential roofing solutions, to ensure seamless solar installations and long-term durability.
Removed
In addition, on March 28, 2022 and immediately prior to the closing of the merger, Pineapple Energy completed its acquisition (“HEC Asset Acquisition”) of substantially all of the assets of two Hawaii-based solar energy companies, HEC and E-Gear.
Added
Additionally, we provide community solar services that allow groups of individuals, businesses, or organizations to share the benefits of a single solar array, making renewable energy accessible to more people in the community.
Removed
On November 9, 2022, the Company purchased the equity of New York-based SUNation Solar Systems, Inc. and five of its affiliated entities (collectively “SUNation”).
Added
In 2026, we will be expanding this product offering to include the Generac full home ecosystem, which includes their new power electronics, whole home batteries, standby generators, and smart thermostat that control the entire system.  Seasoned and experienced management team. We have a strong leadership team, with deep experience in residential and commercial solar and M&A.
Removed
On November 14, 2024, the Company filed articles of conversion with the Secretary of State of the State of Minnesota and filed a certificate of conversion with the Secretary of State of the State of Delaware changing its jurisdiction of incorporation from Minnesota to Delaware (the “Reincorporation”), as well as having filed a Certificate of Incorporation with the Secretary of State of the State of Delaware on this same date.
Added
The Company actively services and repairs the systems of competitor systems, as is technically feasible based on component type, age, and staff qualifications and training.
Removed
Concurrently with the Reincorporation, the Company also effectuated a change to its name from Pineapple Energy, Inc. to SUNation Energy, Inc., and to its stock trading symbol from PEGY to SUNE, effective November 19, 2024. Pursuant to the merger agreement, the Company sold substantially all of its JDL Technologies, Inc. (“JDL”) and Ecessa Corporation (“Ecessa”) businesses on June 30, 2023.
Added
While the market within the northeast is competitive, SUNation Energy’s solar and service operations allow nearly unprecedented access to homeowners in need of roofing solutions.
Removed
Because the Company was working to divest such assets pursuant to the merger agreement, it previously met the criteria to report the operations of these businesses as discontinued operations.
Added
Over the years, the company has invested heavily in the hiring of talented roof installers, and deepening relationships with industry leaders in the roofing space such as GAF, the largest roofing and waterproofing manufacturer in North America. SUNation NY is currently a GAF Master Elite installer, and been recognized in GAF’s President’s Club awards.
Removed
See Note 6 of the Notes to the Consolidated Financial Statements, “Discontinued Operations.” As a result, unless otherwise noted, all information in this Form 10-K related to the JDL and Ecessa businesses is discussed and presented as discontinued operations and the Company’s remaining business operations are reported as continuing operations.
Added
Within the competitive New York market, SUNation NY ranked first among solar contractors in total installed solar energy in the region in 2025, as per publicly available utility interconnection data.
Removed
In addition, the excess production from the panels during the day can be used to recharge a battery that was depleted overnight. 8 In the Hawaiian market we also offer energy management control devices on solar systems that are paired with batteries.
Added
In addition, utility interconnection data shows that SUNation NY’s aggregate installed capacity on Long Island increased approximately 29% year over year in 2025, highlighting continued growth in system deployments and reinforcing the Company’s position within one of the most active solar markets in the Northeast.
Removed
As a result of the U.S. Inflation Reduction Act, which was passed by Congress and signed into law by then-President Joe Biden in 2022, commercial solar opportunities have grown as more institutional uses, including churches, private schools, and non-profit organizations, have become both eligible and aware of governmental incentives to enhance solar adoption across the country.
Added
On July 4, 2025, the President signed H.R. 1, the “One Big Beautiful Bill Act,” or “OBBBA”, into law, which accelerates the phase-outs and terminations of various eligible tax credits enacted as part of the Inflation Reduction Act and places restrictions on continued receipt of tax credits by specified foreign entities and foreign influenced entities.
Removed
This 30% tax credit lasts until 2033 before stepping down to 26% in 2033, 22% in 2034, and 0% in 2035, unless extended again by Congress. Since its inception in 2005, the ITC has already been extended three times.
Added
The OBBBA terminates several consumer-facing tax credits, including the Residential Clean Energy Credit (Section 25D) and the Energy Efficient Home 9 Improvement Credit (Section 25C), effective at the end of 2025. The Section 25D credit previously allowed homeowners to claim a 30% credit for installing rooftop solar panels and related equipment.
Removed
In addition to net metering, many states have enacted programs to further compensate homeowners who generate their own clean electricity for their contributions to society via their production of carbon-free renewable electricity. The mechanisms can vary, but solar renewable energy certificates (“SREC”) or production credits are two of the more common paths.
Added
The OBBBA also has an accelerated phaseout of the Clean Electricity Investment Tax Credit (Section 48E) and the Clean Electricity Production Tax Credit (45Y). In this accelerated phase out, projects must begin construction by July 4, 2026, or be placed in service by December 31, 2027, to qualify for these credits.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

61 edited+90 added−126 removed172 unchanged
Biggest changeOn April 11, 2025, we received a new non-compliance notice notifying the Company that, for the 30 consecutive business day period immediately preceding deficiency letter, the Company’s common stock had not maintained a minimum closing bid price of $1.00 per share (the “Minimum Bid Price Requirement”) and, as a result, does not comply with Listing Rule 5550(a)(2) (the “Rule”).
Biggest changeIn the past, from time to time, we have received certain notices from Nasdaq of non-compliance items. 10 For example, as previously reported, the Company had received respective Nasdaq non-compliance letters regarding: (i) a Minimum Bid Price Deficiency notice from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market notifying the Company that, for the 30 consecutive business day period immediately preceding April 11, 2025 deficiency letter, the Company’s common stock had not maintained a minimum closing bid price of $1.00 per share (the “Minimum Bid Price Requirement”) and, as a result, did not comply with Listing Rule 5550(a)(2); and (ii) the Staff’s additional delisting notice pursuant to its discretionary authority under Listing Rule 5101 based on public interest concerns related to the Company’s securities offering announced on February 27, 2025.
In addition to the other risks described in this section, the following factors could cause the Company’s operating results to fluctuate: expiration or initiation of any governmental rebates or incentives; significant fluctuations in customer demand for the Company’s solar energy systems; our ability to continue to expand the Company’s operations and the amount and timing of expenditures related to this expansion; announcements by the Company or its competitors of significant acquisitions; strategic partnerships, joint ventures or capital-raising activities or commitments; price of materials and supplies; availability and cost of labor; changes in the Company’s pricing policies or terms or those of its competitors, including centralized electric utilities; actual or anticipated developments in the Company’s competitors’ businesses; technology or the competitive landscape; and natural disasters or other weather or meteorological conditions. ‎ For these or other reasons, past performance should not be relied upon as indications of the Company’s future performance.
In addition to the other risks described in this section, the following factors could cause the Company’s operating results to fluctuate: expiration or initiation of any governmental rebates or incentives; significant fluctuations in customer demand for the Company’s solar energy systems; our ability to continue or to expand the Company’s operations and the amount and timing of expenditures related to this expansion; announcements by the Company or its competitors of significant acquisitions; strategic partnerships, joint ventures or capital-raising activities or commitments; price of materials and supplies; availability and cost of labor; changes in the Company’s pricing policies or terms or those of its competitors, including centralized electric utilities; actual or anticipated developments in the Company’s competitors’ businesses; technology or the competitive landscape; and natural disasters or other weather or meteorological conditions. ‎ For these or other reasons, past performance should not be relied upon as indications of the Company’s future performance.
The price of electricity from utilities could decrease for any one or more reasons, including but not limited to: the construction of a significant number of new power generation plants, whether generated by natural gas, nuclear power, coal or renewable energy; the construction of additional electric transmission and distribution lines; a reduction in the price of natural gas or other natural resources as a result of increased supply due to new drilling techniques or other technological developments; a relaxation of associated regulatory standards or broader economic or policy developments; less demand for electricity due to energy conservation technologies and public initiatives to reduce electricity consumption or to recessionary economic conditions; and development of competing energy technologies that provide less expensive energy. ‎ A reduction in electric utilities’ rates or changes to peak hour pricing policies or rate design (such as the adoption of a fixed or flat rate or adding fees to homeowners that have residential solar systems) could also make the Company’s offerings less competitive with the 23 price of electricity from the electrical grid.
The price of electricity from utilities could decrease for any one or more reasons, including but not limited to: the construction of a significant number of new power generation plants, whether generated by natural gas, nuclear power, coal or renewable energy; the construction of additional electric transmission and distribution lines; a reduction in the price of natural gas or other natural resources as a result of increased supply due to new drilling techniques or other technological developments; a relaxation of associated regulatory standards or broader economic or policy developments; less demand for electricity due to energy conservation technologies and public initiatives to reduce electricity consumption or to recessionary economic conditions; and development of competing energy technologies that provide less expensive energy. ‎ A reduction in electric utilities’ rates or changes to peak hour pricing policies or rate design (such as the adoption of a fixed or flat rate or adding fees to homeowners that have residential solar systems) could also make the Company’s offerings less competitive with the price of electricity from the electrical grid.
Many factors may affect the demand for solar energy systems, including, but not limited to, the following: availability, substance and magnitude of solar support programs, including government targets; subsidies, incentives, renewable portfolio standards and residential net metering rules; the relative pricing of other conventional and non-renewable energy sources, such as natural gas, coal, oil and other fossil fuels, wind, utility-scale solar, nuclear, geothermal and biomass; performance, reliability and availability of energy generated by solar energy systems compared to conventional and other non-solar renewable energy sources; availability and performance of energy storage technology, the ability to implement this technology for use in conjunction with solar energy systems and the cost competitiveness this technology provides to customers as compared to costs for those customers that rely solely on the conventional electrical grid; and general economic conditions, supply chain conditions and the level of interest rates.
Many factors may affect the demand for solar energy systems, including, but not limited to, the following: availability, substance and magnitude of solar support programs, including government targets; subsidies, incentives, renewable portfolio standards and residential net metering rules; the relative pricing of other conventional and non-renewable energy sources, such as natural gas, coal, oil and other fossil fuels, wind, utility-scale solar, nuclear, geothermal and biomass; performance, reliability and availability of energy generated by solar energy systems compared to conventional and other non-solar renewable energy sources; 23 availability and performance of energy storage technology, the ability to implement this technology for use in conjunction with solar energy systems and the cost competitiveness this technology provides to customers as compared to costs for those customers that rely solely on the conventional electrical grid; and general economic conditions, supply chain conditions and the level of interest rates.
These risks include the following, among others: ‎ Failure to satisfy the required conditions and otherwise complete a planned acquisition, joint venture or other strategic transaction on a timely basis or at all; Legal or regulatory proceedings, if any, relating to a planned acquisition, joint venture or other strategic transaction and the outcome of such legal proceedings; 17 Difficulty in assimilating the operations, systems, and personnel of the acquired company; Difficulty in effectively integrating the acquired technologies or products with our current products and technologies; Difficulty in maintaining controls, procedures and policies during the transition and integration; Disruption of our ongoing business and distraction of our 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 our results of operations; Significant post-acquisition investments which may lower the actual benefits realized through the acquisition; Potential failure of the due diligence processes to identify significant issues with product quality, legal, and financial liabilities, among other things; Moderating and anticipating the impacts of inherent or emerging seasonality in acquired customer agreements; 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. ‎ Our failure to address these risks, or other problems encountered in connection with our past or future investments, strategic transactions, or acquisitions, could cause us to fail to realize the anticipated benefits of these acquisitions or investments, cause us to incur unanticipated liabilities, and harm our business generally.
These risks include the following, among others: ‎ Failure to satisfy the required conditions and otherwise complete a planned acquisition, joint venture or other strategic transaction on a timely basis or at all; Legal or regulatory proceedings, if any, relating to a planned acquisition, joint venture or other strategic transaction and the outcome of such legal proceedings; Difficulty in assimilating the operations, systems, and personnel of the acquired company; 16 Difficulty in effectively integrating the acquired technologies or products with our current products and technologies; Difficulty in maintaining controls, procedures and policies during the transition and integration; Disruption of our ongoing business and distraction of our 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 our results of operations; Significant post-acquisition investments which may lower the actual benefits realized through the acquisition; Potential failure of the due diligence processes to identify significant issues with product quality, legal, and financial liabilities, among other things; Moderating and anticipating the impacts of inherent or emerging seasonality in acquired customer agreements; 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. ‎ Our failure to address these risks, or other problems encountered in connection with our past or future investments, strategic transactions, or acquisitions, could cause us to fail to realize the anticipated benefits of these acquisitions or investments, cause us to incur unanticipated liabilities, and harm our business generally.
The Company’s supply chain and operations could be subject to natural disasters and other events beyond its control, such as earthquakes, wildfires, flooding, hurricanes, tsunamis, typhoons, volcanic eruptions, droughts, tornadoes, power outages or other natural disasters, the effects of climate change and related extreme weather, public health issues and pandemics, war, terrorism, government restrictions or limitations on trade, and geo-political unrest and uncertainties.
The Company’s supply chain and operations could be subject to natural disasters and other events beyond its control, such as earthquakes, wildfires, flooding, hurricanes, tsunamis, typhoons, volcanic eruptions, droughts, tornadoes, power outages or other 14 natural disasters, the effects of climate change and related extreme weather, public health issues and pandemics, war, terrorism, government restrictions or limitations on trade, and geo-political unrest and uncertainties.
If the Company were subject to the same state 24 or federal regulatory authorities as centralized electric utilities in the U.S. and its territories or if new regulatory bodies were established to oversee its business in the U.S. and its territories or in foreign markets it enters, its operating costs would materially increase or it might have to change its business in ways that could have a material adverse effect on its business, financial condition and results of operations.
If the Company were subject to the same state or federal regulatory authorities as centralized electric utilities in the U.S. and its territories or if new regulatory bodies were established to oversee its business in the U.S. and its territories or in foreign markets it enters, its operating costs would materially increase or it might have to change its business in ways that could have a material adverse effect on its business, financial condition and results of operations.
The Company’s articles of incorporation authorize the board of directors, without the approval of the Company shareholders, to issue up to 3,000,000 shares of preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions 14 of the articles of incorporation, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof.
The Company’s articles of incorporation authorize the board of directors, without the approval of the Company shareholders, to issue up to 3,000,000 shares of preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions of the articles of incorporation, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof.
The consummation and timing of any future acquisitions will depend upon, among other things, whether the Company is able to: identify attractive acquisition candidates that are accretive and net profitable; negotiate economically acceptable purchase agreements; obtain any required governmental or third-party consents; obtain financing for these acquisitions on economically acceptable terms; which may be more difficult at times when the capital markets are less accessible; and outbid any competing bidders. ‎ Additionally, any acquisition involves potential risks, including, among other things: mistaken assumptions about assets, revenues and expenses of the acquired company, including synergies and potential growth; an inability to successfully integrate the assets or businesses the Company acquires; coordinating geographically disparate organizations, systems and facilities; the assumption of unknown liabilities for which the Company is not indemnified or for which its indemnity is inadequate; mistaken assumptions about the acquired company’s suppliers or other vendors; the diversion of management’s and employees’ attention from other business concerns; unforeseen difficulties operating in new geographic areas and business lines; customer or key employee losses at the acquired business; and poor quality assets or installation. ‎ If the Company consummates future acquisitions, its capitalization, results of operations and future growth may change significantly and its shareholders may not have the opportunity to evaluate the economic, financial and other relevant information considered in deciding to engage in these future acquisitions.
The consummation and timing of any future acquisitions will depend upon, among other things, whether the Company is able to: identify attractive acquisition candidates that are accretive and net profitable; negotiate economically acceptable purchase agreements; obtain any required governmental or third-party consents; obtain financing for these acquisitions on economically acceptable terms which may be more difficult at times when the capital markets are less accessible; and outbid any competing bidders. ‎ Additionally, any acquisition, joint venture, or merger involves potential risks, including, among other things: mistaken assumptions about assets, revenues and expenses of the acquired company, including synergies and potential growth; an inability to successfully integrate the assets or businesses the Company acquires; coordinating geographically disparate organizations, systems and facilities; the assumption of unknown liabilities for which the Company is not indemnified or for which its indemnity is inadequate; mistaken assumptions about the acquired company’s suppliers or other vendors; the diversion of management’s and employees’ attention from other business concerns; unforeseen difficulties operating in new geographic areas and business lines; customer or key employee losses at the acquired business; and poor quality assets or installation. ‎ If the Company consummates future acquisitions, its capitalization, results of operations and future growth may change significantly and its shareholders may not have the opportunity to evaluate the economic, financial and other relevant information considered in deciding to engage in these future acquisitions.
This 22 may limit the Company’s ability to acquire new customers, particularly those who have an objection to putting solar panels on their roofs. The Company also competes with solar companies with business models similar to its own, that market to similar potential customers. Some of these competitors specialize in the distributed residential solar energy market.
This may limit the Company’s ability to acquire new customers, particularly those who have an objection to putting solar panels on their roofs. The Company also competes with solar companies with business models similar to its own, that market to similar potential customers. Some of these competitors specialize in the distributed residential solar energy market.
However, these programs may expire on a particular date, end when the allocated funding is exhausted or be reduced or terminated as solar energy adoption rates increase. 25 A loss or reduction in such incentives could decrease the attractiveness of new solar energy systems to customers, which could adversely impact the Company’s business.
However, these programs may expire on a particular date, end when the allocated funding is exhausted or be reduced or terminated as solar energy adoption rates increase. A loss or reduction in such incentives could decrease the attractiveness of new solar energy systems to customers, which could adversely impact the Company’s business.
If the Company cannot manage its hiring and training processes to avoid or minimize these issues to the extent possible, its reputation may be harmed and its ability to attract new customers would suffer. 19 The loss of one or more members of the Company’s senior management or key employees may adversely affect its ability to implement its strategy.
If the Company cannot manage its hiring and training processes to avoid or minimize these issues to the extent possible, its reputation may be harmed and its ability to attract new customers would suffer. The loss of one or more members of the Company’s senior management or key employees may adversely affect its ability to implement its strategy.
For example, then President Biden’s administration increased Section 301 tariffs on imports of wafers, polysilicon and certain tungsten products from China. Solar wafers and polysilicon imports, critical components for solar energy development, now face a 50% tariff rate. Tungsten products, such as bars and sheets, will be subject to a 25% tariff rate.
For example, then President Biden’s administration increased Section 301 tariffs on imports of wafers, polysilicon and certain tungsten products from China. As a result, solar wafers and polysilicon imports, critical components for solar energy development, now face a 50% tariff rate. Tungsten products, such as bars and sheets, will be subject to a 25% tariff rate.
The successful assertion 18 of product liability claims against the Company could result in potentially significant monetary damages, potential increases in insurance expenses, penalties or fines, subject it to adverse publicity, damage its reputation and competitive position and adversely affect sales of solar energy systems.
The successful assertion of product liability claims against the Company could result in potentially significant monetary damages, potential increases in insurance expenses, penalties or fines, subject it to adverse publicity, damage its reputation and competitive position and adversely affect sales of solar energy systems.
Any failure, or perceived failure, by the Company to comply with any regulatory requirements or international privacy or consumer protection-related laws and regulations could result in proceedings or actions against it by governmental entities or others, subject it to significant penalties and negative 20 publicity and adversely affect us.
Any failure, or perceived failure, by the Company to comply with any regulatory requirements or international privacy or consumer protection-related laws and regulations could result in proceedings or actions against it by governmental entities or others, subject it to significant penalties and negative publicity and adversely affect us.
As a result, the Company requires a dditional funding and seeks to raise 15 capital through sources that may include public or private equity offerings, debt financings and/or strategic alliances. However, additional funding may not be available on terms acceptable to the Company, or at all.
As a result, the Company requires a dditional funding and seeks to raise capital through sources that may include public or private equity offerings, debt financings and/or strategic alliances. However, additional funding may not be available on terms acceptable to the Company, or at all.
However, during the fourth quarter of fiscal 2024, we performed an interim quantitative assessment as of December 31, 2024 related to the recoverability of our goodwill for our two reporting units as a result of a material decline in our stock price and forecasted revenues and operating results.
During the fourth quarter of fiscal 2024, we performed an interim quantitative assessment as of December 31, 2024 related to the recoverability of our goodwill for our two reporting units as a result of a material decline in our stock price and forecasted revenues and operating results.
Any disruptions to these specific states or regional areas may impact the Company’s operations and financial results. Litigation brought by third parties claiming breach of contract, contractual defaults or other claims for may be costly and time consuming.
Any disruptions to these specific states or regional areas may impact the Company’s operations and financial results. 22 Litigation brought by third parties claiming breach of contract, contractual defaults or other claims for may be costly and time consuming.
For example, the May 2021 ransomware attack on the owners of the Colonial Pipeline system forced a shutdown of its operations for multiple days, requiring significant capital outlays and concerns by customers and regulators of the reliability of the electricity provision.
For example, the May 2021 ransomware attack on the owners of the Colonial Pipeline system forced 25 a shutdown of its operations for multiple days, requiring significant capital outlays and concerns by customers and regulators of the reliability of the electricity provision.
These and other similar trade restrictions that may be imposed in the future could cause delivery and installation delays and restrict the global supply of polysilicon and solar products.
These and similar trade restrictions that may be imposed in the future could cause delivery and installation delays, and restrict the global supply of polysilicon and solar products.
The Company’s success and ability to further scale its business will depend, in part, on its ability to manage these changes in a cost-effective and efficient manner.
The 13 Company’s success and ability to further scale its business will depend, in part, on its ability to manage these changes in a cost-effective and efficient manner.
Factors that may have a significant impact on the market price and marketability of the Company’s common stock include, among others: public reaction to the Company’s press releases, announcements and filings with the SEC; the Company’s operating and financial performance; fluctuations in broader securities market prices and volumes, particularly among securities of technology and solar companies; changes in market valuations of similar companies; departures of key personnel; 13 commencement of or involvement in material litigation; variations in the Company’s quarterly results of operations or those of other technology and solar companies; changes in general economic conditions, financial markets or the technology and solar industries; announcements by the Company or its competitors of significant acquisitions or other transactions; changes in accounting standards, policies, guidance, interpretations or principles; speculation in the press or investment community; actions by the Company’s shareholders, particularly relating to the Company’s common stock; the failure of securities analysts to cover the Company’s common stock or changes in their recommendations and estimates of its financial performance; future sales of the Company’s common stock; the delisting of the Company’s common stock or halting or suspension of trading in its common stock by the Nasdaq Stock Market; economic and other external factors such as global conflicts, trade wars and the impacts of domestic and foreign tariffs on supplies, parts and other solar related materials and components; and general market conditions.
Factors that may have a significant impact on the market price and marketability of the Company’s common stock include, among others: public reaction to the Company’s press releases, announcements and filings with the SEC; the Company’s operating and financial performance; fluctuations in broader securities market prices and volumes, particularly among securities of technology and solar companies; changes in market valuations of similar companies; departures of key personnel; commencement of or involvement in material litigation; variations in the Company’s quarterly results of operations or those of other technology and solar companies; changes in general economic conditions, financial markets or the technology and solar industries; announcements by the Company or its competitors of significant acquisitions or other transactions; changes in accounting standards, policies, guidance, interpretations or principles; speculation in the press or investment community; actions by the Company’s shareholders, particularly relating to the Company’s common stock; the failure of securities analysts to cover the Company’s common stock or changes in their recommendations and estimates of its financial performance; future sales of the Company’s common stock; the delisting of the Company’s common stock or halting or suspension of trading in its common stock by the Nasdaq Stock Market; economic and other external factors such as global conflicts, trade wars and the impacts of domestic and foreign tariffs on supplies, parts and other solar related materials and components; and general market conditions. 12 The Company may issue additional common stock resulting in stock ownership dilution.
The Company relies on information technology systems and infrastructure to support its business. Any of these systems may be susceptible to damage or interruption due to fire, floods, power loss, telecommunication failures, usage errors by employees, computer viruses, cyberattacks or other security breaches or similar events.
The Company may be subject to interruptions or failures in its information technology systems. The Company relies on information technology systems and infrastructure to support its business. Any of these systems may be susceptible to damage or interruption due to fire, floods, power loss, telecommunication failures, usage errors by employees, computer viruses, cyberattacks or other security breaches or similar events.
The powers, preferences and rights of these series of preferred stock may be senior to or on parity with our common stock, which may reduce its value. Risks Relating to the Company’s Business The Company’s growth strategy depends on the continued origination of solar installation agreements. The Company’s growth strategy depends on the continued origination of solar installation agreements.
The powers, preferences and rights of these series of preferred stock may be senior to or on parity with our common stock, which may reduce its value. Risks Relating to the Company’s Business The Company’s continued success and viability depends on the continued origination of solar installation agreements.
In addition, product liability claims, injuries, defects or other problems experienced by other companies in the residential solar industry could lead to unfavorable market conditions to the industry as a whole and may have an adverse effect on the Company’s ability to expand its portfolio of solar installation agreements, thus affecting its business, financial condition and results of operations.
In addition, product liability claims, injuries, defects or other problems experienced by other companies in the residential solar industry could lead to unfavorable market conditions to the industry as a whole and may have an adverse effect on the Company’s ability to expand its portfolio of solar installation agreements, thus affecting its business, financial condition and results of operations. 18 Changes in our business strategy or restructuring of our businesses may increase our costs or otherwise affect our businesses.
Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.
This could have an adverse effect on the price of our common stock. Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.
In any of these events our costs may increase, and we may have significant charges or losses associated with the write-down or divestiture of assets and our business may be materially and adversely affected. We may not fully realize the anticipated benefits from our restructuring efforts begun in 2024, which continue into 2025.
Any of these events our costs may increase, and we may have significant charges or losses associated with the write-down or divestiture of assets and our business may be materially and adversely affected. We may not fully realize the anticipated benefits from our restructuring or diversification efforts.
Our ability to achieve the anticipated cost savings, increased revenue, increased margins and other benefits from our restructuring, or other efforts within expected time frames is subject to many estimates and assumptions, and may vary materially based on factors such as market conditions and the effect of our efforts on our workforce.
Our ability to achieve the anticipated cost savings and other benefits from our restructuring, or other strategic diversification or expansion efforts within expected time frames is subject to many estimates and assumptions, and may vary materially based on factors such as market conditions and the effect of our efforts on our work force.
If the Company is unable to make net profitable acquisitions on economically acceptable terms, its future growth would be limited, and any acquisitions it may make could reduce, rather than increase, its cash flows.
If the Company is unable to make net profitable acquisitions, successful joint ventures, mergers, or other diversification strategies on economically acceptable terms, its future growth would be limited, and any acquisitions it may make could reduce, rather than increase, its cash flows.
The Company’s operating results and its ability to grow may fluctuate from quarter to quarter and year to year, which could make its future performance difficult to predict and could cause its operating results for a particular period to fall below expectations. The Company’s quarterly and annual operating results are difficult to predict and may fluctuate significantly in the future.
The Company’s operating results and its ability to grow or viability continue may fluctuate from quarter to quarter and year to year, which could make its future performance difficult to predict and could cause its operating results for a particular period to fall below expectations.
As new entrants continue to enter into these markets, the Company may be unable to grow or maintain its operations and it may be unable to compete with companies that earn revenue in both the residential market and non-residential markets.
There is intense competition in the residential solar energy sector in the markets in which the Company operates. As new entrants continue to enter into these markets, the Company may be unable to grow or maintain its operations and it may be unable to compete with companies that earn revenue in both the residential market and non-residential markets.
With regard to interconnection limits, the Federal Energy Regulatory Commission, (“FERC”), in promulgating the first form of small generator interconnection procedures, recommended limiting customer-sited intermittent generation resources, such as the Company’s solar energy systems, to a certain percentage of peak load on a given electrical feeder circuit.
The Company’s solar energy systems generally do not provide power to homeowners until they are interconnected to the grid. 27 With regard to interconnection limits, the Federal Energy Regulatory Commission, (“FERC”), in promulgating the first form of small generator interconnection procedures, recommended limiting customer-sited intermittent generation resources, such as the Company’s solar energy systems, to a certain percentage of peak load on a given electrical feeder circuit.
As noted in Note 17, Subsequent Events, the Company raised capital and satisfied certain outstanding debt obligations subsequent to year end, however there remains uncertainty related to our future cash flows as it relies on the ability to generate enough cash flow from its operating segments to cover the Company’s corporate overhead costs.
As noted in Note 11, Equity, and Note 8, Commitments and Contingencies, the Company raised capital and satisfied certain outstanding debt obligations during 2025, however there remains uncertainty related to our future cash flows as it relies on the ability to generate enough cash flow from its operating segments to cover the Company’s corporate overhead costs.
Increases in the cost of the Company’s solar energy systems due to tariffs and other trade restrictions imposed by the U.S. and foreign governments could have a material adverse effect on its business, financial condition and results of operations. The United States has often considered tariffs on industry-related goods imported from other countries.
Increases in the cost of the Company’s solar energy systems due to tariffs and other trade restrictions imposed by the U.S. and foreign governments could have a material adverse effect on its business, financial condition and results of operations.
In regard to our realigned strategy and exploration of accretive and net profitable acquisitions, as well as strategic alternatives, we may not achieve the expected benefits of such activities.
In regard to our realigned strategy and continued exploration of strategic alternatives, we may not achieve the expected benefits of such activities.
We may not realize the anticipated benefits of past or future investments, strategic transactions, or acquisitions, and integration of these acquisitions may disrupt our business and our management. We have in the past and may in the future, acquire companies, projects, products, or technologies or enter into joint ventures or other strategic transactions.
We have in the past and may in the future, acquire companies, projects, products, or technologies or enter into joint ventures or other strategic transactions. We may not realize the anticipated benefits of past or future investments, strategic transactions, or acquisitions, and these transactions involve numerous risks that are not within our control.
During 2024 through March 15, 2025, the sale price of common stock ranged from $0.16 to $480 per share, and our daily trading volume ranged from 11 to approximately 514.0 million shares. This volatility may, in part, be the result of broad market and industry factors.
During 2025 through March 1, 2026, the sale price of common stock ranged from $0.68 to $539 per share, and our daily trading volume ranged from 79 to approximately 69.6 million shares. This volatility may, in part, be the result of broad market and industry factors.
As a result of infrequent or sparse interpretations, ambiguities in these laws and regulations may create uncertainty with respect to what type of conduct is permitted or restricted under such laws and regulations.
These laws and regulations are subject to change and modification by statute, administrative rules and orders, and judicial interpretation. As a result of infrequent or sparse interpretations, ambiguities in these laws and regulations may create uncertainty with respect to what type of conduct is permitted or restricted under such laws and regulations.
Utilities throughout the country follow different rules and regulations regarding interconnection and regulators or utilities have or could cap or limit the amount of solar energy that can be interconnected to the grid. The Company’s solar energy systems generally do not provide power to homeowners until they are interconnected to the grid.
Utilities throughout the country follow different rules and regulations regarding interconnection and regulators or utilities have or could cap or limit the amount of solar energy that can be interconnected to the grid.
Changes in our business strategy or restructuring of our businesses may increase our costs or otherwise affect our businesses. We continually review our operations with a view toward reducing our cost structure, including, but not limited to, reducing our labor cost-to-revenue ratio, improving process and system efficiencies and increasing our revenues and operating margins.
We continually review our operations with a view toward reducing our cost structure, including, but not limited to, reducing our labor cost-to-revenue ratio, improving process and system efficiencies and increasing our revenues and operating margins.
The distributed residential solar energy market is at a relatively early stage of development in comparison to fossil fuel-based electricity generation. If additional demand for distributed residential solar energy systems fails to develop sufficiently or takes longer to develop than the Company anticipates, it may negatively impact the Company’s business.
If sufficient additional demand for residential solar energy systems does not develop or takes longer to develop than the Company anticipates, its ability to originate solar installation agreements may decrease. The distributed residential solar energy market is at a relatively early stage of development in comparison to fossil fuel-based electricity generation.
If the Company is unable to raise additional funds, it would have a negative impact on the Company’s business, results of operations and financial condition.
If the Company is unable to raise additional funds, it would have a negative impact on the Company’s business, results of operations and financial condition. Our ability to operate as a going concern is contingent upon successfully obtaining additional financing.
Our business is or may also be subject to federal and state laws that regulate consumer credit report information, data privacy, debt collection, electronic fund transfers, service contracts, home improvement contracting and marketing activities (such as telemarketing, door-to-door sales, and e-mails).
Our business is or may also be subject to federal and state laws that regulate consumer credit report information, data privacy, debt collection, electronic fund transfers, service contracts, home improvement contracting and marketing activities (such as telemarketing, door-to-door sales, and e-mails). 28 While we have developed policies and procedures designed to assist in compliance with these laws and regulations, no assurance is given that our compliance policies and procedures will be effective.
When these changes or events occur, we may incur costs to change our business strategy and may need to write down the value of assets or sell certain assets. Additionally, any of these events could result in disruptions or adversely impact our relationships with our workforce, suppliers and customers.
When these changes or events occur, we may incur costs to change our business strategy and may need to write down the value of assets or sell certain assets.
If a license is not available at all or not available on commercially reasonable terms, the Company may be required to develop or license a non-violating alternative, either of which could adversely affect its business, results of operations, financial condition and cash flows. The Company may be subject to interruptions or failures in its information technology systems.
To avoid a prohibition, the Company could seek a license from third parties, which could require it to pay significant royalties, increasing its operating expenses. 21 If a license is not available at all or not available on commercially reasonable terms, the Company may be required to develop or license a non-violating alternative, either of which could adversely affect its business, results of operations, financial condition and cash flows.
There are an additional 264 shares reserved for issuance upon the settlement of outstanding restricted stock units, 12,482 shares available for grant under the 2022 Equity Incentive Plan, and 400 shares available for issuance under the 2022 Employee Stock Purchase Plan.
As of March 1, 2026, we had 3,406,616 shares of common stock outstanding. There are an additional 60 shares reserved for issuance upon the settlement of outstanding restricted stock units, 3 shares available for grant under the 2022 Equity Incentive Plan, and 2 shares available for issuance under the 2022 Employee Stock Purchase Plan.
If a judgment is entered against us, and we are unable to satisfy the judgment, a plaintiff may attempt to levy on our assets.
If a judgment is entered against us, and we are unable to satisfy the judgment, a plaintiff may attempt to levy on our assets. We may be forced to sell material assets to satisfy such judgment, which may, in turn, force us to reduce or discontinue our operations.
As utility companies offer increasingly renewable portfolios to retail customers, those customers might be less inclined to install a solar energy system at their home, which could adversely affect the Company’s growth.
As utility companies offer increasingly renewable portfolios to retail customers, those customers might be less inclined to install a solar energy system at their home, which could adversely affect the Company’s growth. 24 The Company competes with companies that sell solar energy systems and services in the commercial, industrial and government markets, in addition to the residential market, in the U.S. and foreign markets.
Based on the Company’s current financial position, which includes approximately $0.3 million of restricted cash, cash equivalents and investments that are restricted under the CVR agreement and cannot be used by the Company for its own working capital needs, and the Company’s forecasted future cash flows for twelve months beyond the date of issuance of these financial statements, substantial doubt exists around the Company’s ability to continue as a going concern for a reasonable period of time.
Based on the Company’s current financial position and the Company’s forecasted future cash flows for twelve months beyond the date of issuance of these financial statements, substantial doubt exists around the Company’s ability to continue as a going concern for a reasonable period of time.
Failure to maintain our listing, or de-listing from Nasdaq, would make it more difficult for shareholders to dispose of our common stock and more difficult to obtain accurate price quotations 11 on our common stock. This could have an adverse effect on the price of our common stock.
Nasdaq has rules for continued listing, including, without limitation, minimum market capitalization and other requirements. Failure to maintain our listing, or de-listing from Nasdaq, would make it more difficult for shareholders to dispose of our common stock and more difficult to obtain accurate price quotations on our common stock.
The Company relies on net metering and related policies to sell solar systems to its customers in most of its current markets, and changes to policies governing net metering may significantly reduce demand for electricity from residential solar energy systems and thus for the Company’s installation services.
Furthermore, any effort to overturn federal and state laws, regulations or policies that support solar energy generation or that remove costs or other limitations on other types of energy generation that compete with solar energy projects could materially and adversely affect the Company’s business. 26 The Company relies on net metering and related policies to sell solar systems to its customers in most of its current markets, and changes to policies governing net metering may significantly reduce demand for electricity from residential solar energy systems and thus for the Company’s installation services.
Individuals hired by or on behalf of the Company may have workplace accidents and receive citations from OSHA regulators for alleged safety violations, resulting in fines.
Individuals hired by or on behalf of the Company may have workplace accidents and receive 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 the Company to adverse publicity, damage its reputation and competitive position and adversely affect its business.
We must comply with various international, federal, state, and local regulatory regimes, including those applicable to consumer credit transactions, leases, and marketing activities. These laws and regulations are subject to change and modification by statute, administrative rules and orders, and judicial interpretation.
Our business is subject to consumer protection laws. Such laws and regulatory enforcement policies and priorities are subject to change, which may negatively impact our business. We must comply with various international, federal, state, and local regulatory regimes, including those applicable to consumer credit transactions, leases, and marketing activities.
If our estimates and assumptions are incorrect or if other unforeseen events occur, we may not achieve the cost savings expected from such strategic alternative efforts, and our business and results of operations could be adversely affected. The Company will not be able to insure against all potential risks and it may become subject to higher insurance premiums.
If our estimates and assumptions are incorrect or if other unforeseen events occur, we may not achieve the cost savings, increased margins, diversification or expected revenues from such strategic alternative efforts, and our business and results of operations could be adversely affected. We need to obtain substantial additional financing arrangements to provide working capital, expansion and growth capital.
Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors, including those factors discussed below. Risks Related to the Company’s Common Stock Our shares will be subject to potential delisting if we do not maintain the listing requirements of the Nasdaq Capital Market.
Actual events and results may differ materially from those expressed or forecasted in forward-looking statements due to a number of factors, including those factors discussed below.
These estimates and assumptions are subject to significant economic, competitive and other uncertainties, some of which are beyond our control. There can be no assurance that we will fully realize the anticipated positive impacts to our operations, liquidity or future financial results from our current or future efforts.
There can be no assurance that we will fully realize the anticipated positive impacts to our operations, liquidity or future financial results from our current or future cost saving, or the potential benefits of any such expansions or business diversification efforts.
Dilution and potential dilution, the availability of a large number of shares for sale, and the possibility of additional issuances and sales of the Company’s common stock may negatively affect both the trading price and liquidity of the Company’s common stock.
Dilution and potential dilution, the availability of a large number of shares for sale, and the possibility of additional issuances and sales of the Company’s common stock may negatively affect both the trading price and liquidity of the Company’s common stock. 11 Our management concluded that our disclosure controls and procedures and our internal control over financial reporting were not effective as of December 31, 2025 and 2024 due to material weaknesses in internal control over financial reporting.
We may be required to record additional impairment expense on our goodwill in the future. For further information regarding the assessment please see Note 8, Goodwill and Intangible Assets , in this Annual Report on Form 10-K.
For further information regarding the assessment please see Note 7, Goodwill and Intangible Assets , in this Annual Report on Form 10-K. We may not realize the anticipated benefits of past or future investments, strategic transactions, or acquisitions, and integration of these acquisitions may disrupt our business and our management.
As of October 1, 2024, we conducted our annual goodwill impairment test and concluded that the fair value of our reporting units exceeded its carrying value.
We performed a quantitative analysis as of September 30, 2025 and October 1, 2025 and concluded that the fair values of the SUNation NY and HEC reporting units exceeded its carrying value and no impairment charge was necessary. We may be required to record additional impairment expense on our goodwill in the future.
The shares of our common stock are listed on the Nasdaq Capital Market, or Nasdaq. Nasdaq has rules for continued listing, including, without limitation, minimum market capitalization and other requirements.
Risks Related to the Company’s Common Stock Our shares will be subject to potential delisting if we do not maintain the listing requirements of the Nasdaq Capital Market; new and additional proposed Nasdaq listing rules create more stringent listing compliance and risk for more delistings. Our shares of common stock are listed on the Nasdaq Capital Market, or Nasdaq.
For example, in response to allegations regarding forced labor in the Xinjiang Uyghur Autonomous Region of China, the Biden Administration in 2021 passed the Uyghur Forced Labor Prevention Act. This Act has led to intensive examinations, withhold release orders, and other governmental procedures that have caused supply chain and operational delays.
Customs and Border Protection (“CBP”) issued on June 24, 2021, applicable to certain silica-based products manufactured in the Xinjiang Uyghur Autonomous Region of China. Intensive examinations, withhold release orders, and related governmental procedures have resulted in supply chain and operational delays throughout the industry, and we have implemented policies and procedures to maintain compliance and minimize delays.
Removed
Normally, a company would be afforded a 180-calendar day period (“Cure Period”) to demonstrate compliance with such deficiency; however, pursuant to Listing Rule 5810(c)(3)(A)(iv), the Company is not eligible for a customary Cure Period specified in Rule 5810(c)(3)(A) due to the fact that the Company has effected a reverse stock split over the prior one-year period or has effected one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one..
Added
Following receipt of the April 2025 deficiency notice, the Company timely requested a hearing before the Nasdaq Hearing Panel. The hearing request automatically stayed any suspension or delisting action pending the outcome of the hearing. The Company appeared before the Nasdaq Hearing Panel on May 27, 2025 to address the above-noted compliance matters.
Removed
Instead, the Company is offered an opportunity to appeal any deficiency related to a delisting determination to Nasdaq within seven days from receipt of the non-compliance notice. Accordingly, unless the Company timely requests a hearing before a Hearings Panel, the Company’s securities would be subject to suspension/delisting. The Company intends to timely request a hearing before the Hearing Panel.
Added
As of the hearing date, the Company had been in Compliance with the Minimum Bid Price for not less than twenty-five (25) consecutive trading days, and has since maintained Minimum Bid Price compliance to date.
Removed
While the hearing request will automatically stay any suspension or delisting action pending the hearing and the expiration of any additional extension period if granted by the Panel following the hearing, there can be no assurance that the Panel will grant the Company an additional extension period or that the Company will ultimately regain compliance with all applicable requirements for continued listing on The Nasdaq Capital Market.
Added
On June 10, 2025, the Company received the Nasdaq Hearing Panel’s decision in which it notified the Company that it did not find the Company to be in violation of Listing Rules 5100 and 5550(a)(2), the “Public Interest Concern” and “Bid Price Rule”, respectively.
Removed
Additionally, to this end, the stockholders of the Company had approved a share consolidation on April 3, 2025 that has been effectuated within the discretion of the board of directors of the Company and, if such action ultimately resolves the above noted Nasdaq listing compliance deficiency prior to such hearing date, then we may be mooted out of the hearing; however, there can be no assurance that this action by us will result n regaining compliance with the deficiency for a sufficiently long period, or that the we may be delisted despite taking all such remedial actions to avoid such a negative result.
Added
Accordingly, the June 10, 2025 letter further provided that the Company is deemed to be in full compliance with the applicable Nasdaq Listing Rules, and that the above-referenced matter was closed.
Removed
There is no public market for the common warrants or pre-funded warrants issued and outstanding. There is no established public trading market for the common warrants or pre-funded warrants previously issued by us, and we do not expect a market to develop.
Added
While we are currently in compliance with Nasdaq’s listing rules, there is no guarantee that we may not become subject to future non-compliance or delisting notices, any of which could have a serious negative effect on our stock price, volatility, ability to remain listed, liquidity, among other similar adverse effects on our stock and shareholders.
Removed
In addition, we do not intend to apply to list any of our outstanding warrants on any securities exchange or nationally recognized trading system, including The Nasdaq Stock Market. Without an active market, the liquidity of our issued and outstanding warrants will be limited.
Added
Despite the Company’s current compliance with Nasdaq’s existing listing standards, the Nasdaq Stock Market has implemented and proposed additional new rules that require existing Nasdaq listed companies to comply with more stringent continued listing rules. For example, proposed Nasdaq rule changes significantly increase delisting risks by removing grace periods for compliance, targeting low-priced stocks, and raising market value requirements.
Removed
Holders of our common warrants and pre-funded warrants will have no rights as a common stockholder until they acquire our common stock.
Added
Key changes include immediate suspension for falling below a $5 million market value of listed securities (MVLS) and for stocks trading at or below $0.10. Key risks include the elimination of cure periods: previously, companies had an initial automatic 180-day grace period to regain compliance with certain listing standards.
Removed
Until holders of our issued and outstanding warrants acquire shares of our common stock upon exercise of such warrants, the holders will have no rights with respect to shares of our common stock issuable upon exercise of such warrants.
Added
The proposed changes allow for immediate suspension and delisting, particularly when a company's MVLS falls below $5 million for 10 consecutive trading days. Nasdaq is implementing accelerated delisting for stocks trading at or below $0.10 per share for ten consecutive trading days, ultimately targeting companies in severe financial distress.
Removed
Upon exercise of the warrants, holders will be entitled to exercise the rights of a common stockholder only as to matters for which the record date occurs after the exercise date. We may be required to repurchase the common warrants issued in February 2025, which may prevent or deter a third party from acquiring us.
Added
Additionally, Nasdaq has proposed limited appeal rights, including the ability to stay a delisting during an appeal process is being restricted, leaving companies with little to no time to fix deficiencies.
Removed
The February 2025 issued common warrants provide that in the event of a “Fundamental Transaction” (as defined in the related warrant agreement, each common warrant holder will have the right at any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental Transaction), to require us to repurchase the common warrant for a purchase price in cash equal to the Black-Scholes value (as calculated under the warrant agreement) of the then remaining unexercised portion of such common warrant on the date of such 12 Fundamental Transaction, which may materially adversely affect our financial condition and/or results of operations and may prevent or deter a third party from acquiring us.

… 197 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

2 edited+0 added−0 removed4 unchanged
Biggest changeThe COO in conjunction with senior management conducts periodic reviews of cybersecurity control, policies, and procedures to ensure relevance and effectiveness for the Company’s needs and operating environment. The COO has previously led IT programs in his past work experiences and is able to apply those experiences to the Company.
Biggest changeThe CFO in conjunction with senior management conducts periodic reviews of cybersecurity control, policies, and procedures to ensure relevance and effectiveness for the Company’s needs and operating environment. The CFO has previously led IT programs in his past work experiences and is able to apply those experiences to the Company.
ITEM 1C. CYBERSECURITY The Company has an information security program designed to identify, mitigate, respond to and manage reasonably foreseeable cybersecurity risks and threats. The program is overseen by the Chief Operating Officer .
ITEM 1C. CYBERSECURITY The Company has an information security program designed to identify, mitigate, respond to and manage reasonably foreseeable cybersecurity risks and threats. The program is overseen by the Chief Financial Officer .

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−1 removed0 unchanged
Biggest changeITEM 2. PROPERTIES The following is a summary of the Company’s leased property: The Company leases 10,000 square feet of office and warehouse space in Aiea, Hawaii. SUNation leases 20,000 square feet of office and warehouse space in Ronkonkoma, New York and 3,000 square feet of office and warehouse space in Tampa, FL.
Biggest changeITEM 2. PROPERTIES The following is a summary of the Company’s leased property: The Company leases 10,000 square feet of office and warehouse space in Aiea, Hawaii. SUNation NY leases 20,000 square feet of office and warehouse space in Ronkonkoma, New York. The Company believes these facilities will be adequate to accommodate its needs for the foreseeable future.
Removed
The Company believes these facilities will be adequate to accommodate its needs for the foreseeable future.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

4 edited+2 added−1 removed3 unchanged
Biggest changeThe claims against SUNation Energy, Inc. based upon vague allegations of fraud are likely unsustainable. The claims are baseless and frivolous and defendants intend to vigorously defend them. 32 From time to time, we also face threatened legal actions or claims in the ordinary course of our business.
Biggest changeFrom time to time, we also face threatened legal actions or claims in the ordinary course of our business.
Sunation Solar Systems denies that it has an obligation to insure the entire building under the express terms of the lease which is not a “triple net lease.” The landlord has asserted three causes of action for breach of contract, declaratory judgment that the lease requires Sunation to insure the building itself, and a third vague “fraud” theory.
Sunation Solar Systems denies that it has an obligation to insure the entire building under the express terms of the lease, which is not a “triple net lease.” The landlord had asserted three causes of action for breach of contract, declaratory judgment that the lease requires Sunation Solar Systems to insure the building itself, and a third vague “fraud” theory.
In February 2025, an action by a landlord to recover approximately $34,000 plus attorneys’ fees and punitive damages based upon an alleged breach of the lease between Remington Industrial Management LLC and Sunation Solar Systems, Inc.
In early 2025, an action by a landlord was brought to recover approximately $34,000 plus attorneys’ fees and punitive damages based upon an alleged breach of the lease between Remington Industrial Management LLC and Sunation Solar Systems, Inc.
One such matter involves a residential customer who has informally alleged that Sunation Solar Systems is responsible for the cost to replace certain equipment by a third-party manufacturer that was found to be admittedly defective (by the manufacturer), the cost of which may be substantial.
One such matter involved a residential customer who has informally alleged that our subsidiary, Sunation Solar Systems, was responsible for the cost to replace certain equipment by a third-party manufacturer that was found to be admittedly defective (by the manufacturer), the cost of which 29 may be substantial.
Removed
At the moment, SUNation Energy, Inc. has not been included in the claim or allegations; however, to the extent that litigation is commenced, the Company intends to vigorously defend against these as yet unasserted claims. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. PART II
Added
The claims against SUNation Energy, Inc. based upon vague allegations of fraud are likely unsustainable. We have since come to agreement with the Landlord on this matter and a stipulation of discontinuance with prejudice has been filed with the court. As a result, the action has been dismissed.
Added
We have since come to agreement with this residential customer in this matter and, as a result, no litigation or threatened claims relating to this matter remain, and no formal action was filed. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. ‎ 30 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+0 added−1 removed2 unchanged
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The following table presents information about the Company’s equity compensation plans, under which equity securities of the Company are authorized for issuance, as of December 31, 2024: Equity Compensation Plan Information Number of securities Number of securities to be issued upon remaining available exercise of Weighted-average for future issuance under outstanding exercise price of equity compensation options, warrants outstanding options plans (excluding shares Plan Category and rights (1) warrants and rights (2) in first column) Equity compensation plans approved by security holders: (3) 2022 Employee Stock Purchase Plan — $ — 400 2022 Equity Incentive Plan 237 $ — 12,482 Equity compensation plans not approved by security holders: SUNation Inducement Grants 60 $ — — TOTAL 297 $ — 12,882 (1) Includes outstanding awards under the 2022 Equity Incentive Plan, as well as restricted stock units outstanding under inducement grants made to the Company’s newly-hired Chief Financial Officer in October 2022 and to newly-hired employees in connection with the SUNation acquisition in November 2022, in each case in accordance with Nasdaq Listing Rule 5635(c)(4).
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plans The following table presents information about the Company’s equity compensation plans, under which equity securities of the Company are authorized for issuance, as of December 31, 2025: Equity Compensation Plan Information Number of securities Number of securities to be issued upon remaining available exercise of Weighted-average for future issuance under outstanding exercise price of equity compensation options, warrants outstanding options plans (excluding shares Plan Category and rights (1) warrants and rights (2) in first column) Equity compensation plans approved by security holders: (3) 2022 Employee Stock Purchase Plan — $ — 2 2022 Equity Incentive Plan 3 $ — 60 TOTAL 3 $ — 62 (1) Includes outstanding awards under the 2022 Equity Incentive Plan.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Company’s common stock trades on the Nasdaq Capital Market under the trading symbol SUNE. Holders At March 31, 2025, there were approximately 84 registered holders of record of SUNation Energy, Inc. common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Company’s common stock trades on the Nasdaq Capital Market under the trading symbol SUNE. Holders At March 1, 2026, there were approximately 82 registered holders of record of SUNation Energy, Inc. common stock.
The number of shares of Company common stock available for issuance under the Equity Plan initially was 1,000 and was increased to 13,333 after shareholder approvals on December 7, 2022 and July 19, 2024.
The number of shares of Company common stock available for issuance under the Equity Plan initially was 5 and was increased to 67 after shareholder approvals on December 7, 2022 and July 19, 2024.
The ESPP was approved by shareholders on December 7, 2022, and provides for the purchase by eligible employees of shares of the Company’s common stock at a discount to the market price.
The ESPP was approved by shareholders on December 7, 2022, and provides for the purchase by eligible employees of shares of the Company’s common stock at a discount to the market price. The number of shares authorized for issuance under the ESPP was initially 2 and was increased to 4 by shareholder approval on December 14, 2023.
Removed
The number of shares authorized for issuance under the ESPP was initially 267 and was increased to 667 by shareholder approval on December 14, 2023. 33 ITEM 6. [RESERVED] 34

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

42 edited+24 added−44 removed37 unchanged
Biggest changeResults of Operations Consolidated Results The following table summarizes our consolidated results for the years ended December 31, 2024 and 2023: 2024 2023 Change Amount % of Sales Amount % of Sales $ % Sales $ 56,861,753 100% $ 79,632,709 100% $ (22,770,956) -28.6% Cost of sales 36,435,509 64% 51,936,519 65% (15,501,010) -29.8% Gross profit 20,426,244 36% 27,696,190 35% (7,269,946) -26.2% Operating expenses: Selling, general and administrative expenses 27,054,166 48% 29,074,578 37% (2,020,412) -6.9% Amortization expense 2,837,500 5% 4,738,477 6% (1,900,977) -40.1% Fair value remeasurement of SUNation earnout consideration (1,000,000) -2% 1,350,000 2% (2,350,000) -174.1% Goodwill impairment loss 3,101,981 5% — 0% 3,101,981 Intangible asset impairment loss 750,000 1% — 0% 750,000 Total operating expenses 32,743,647 58% 35,163,055 44% (2,419,408) -6.9% Operating loss from continuing operations (12,317,403) -22% (7,466,865) -9% (4,850,538) 65.0% Other (expense) income: Investment and other income 144,529 0% 191,584 0% (47,055) -24.6% (Loss) gain on sale of assets (822) 0% 437,116 1% (437,938) -100.2% Fair value remeasurement of warrant liability (974,823) -2% — 0% (974,823) Fair value remeasurement of embedded derivative liability (65,617) 0% — 0% (65,617) Fair value remeasurement of contingent value rights 522,257 1% 2,674,966 3% (2,152,709) -80.5% Interest expense (3,087,450) -5% (2,657,517) -3% (429,933) 16.2% Loss on debt extinguishment (35,657) 0% — 0% (35,657) Other (expense) income, net (3,497,583) -6% 646,149 1% (4,143,732) -641.3% Operating loss from continuing operations before income taxes (15,814,986) -28% (6,820,716) -9% (8,994,270) 131.9% Income tax expense 34,819 0% 119,176 0% (84,357) -70.8% Net loss from continuing operations (15,849,805) -28% (6,939,892) -9% (8,909,913) 128.4% Net loss from discontinued operations, net of tax — 0% (1,192,275) -1% 1,192,275 -100.0% Net loss $ (15,849,805) -28% (8,132,167) -10% $ (7,717,638) 94.9% 39 Consolidated sales decreased 29% to $56,861,753 in 2024 from $79,632,709 in 2023, with declines in all revenue streams.
Biggest changeResults of Operations 2025 Consolidated Results The following table summarizes our consolidated results for the years ended December 31, 2025 and 2024: 2025 2024 Change Amount % of Sales Amount % of Sales $ % Sales $ 71,905,527 100% $ 56,861,753 100% $ 15,043,774 26% Cost of sales 44,361,314 62% 36,435,509 64% 7,925,805 22% Gross profit 27,544,213 38% 20,426,244 36% 7,117,969 35% Operating expenses: Selling, general and administrative expenses 26,979,750 38% 27,054,166 48% (74,416) 0% Amortization expense 2,237,500 3% 2,837,500 5% (600,000) -21% Fair value remeasurement of SUNation NY earnout consideration — 0% (1,000,000) -2% 1,000,000 -100% Goodwill impairment loss — 0% 3,101,981 5% (3,101,981) -100% Intangible asset impairment loss — 0% 750,000 1% (750,000) -100% Total operating expenses 29,217,250 41% 32,743,647 58% (3,526,397) -11% Operating loss from continuing operations (1,673,037) -2% (12,317,403) -22% 10,644,366 -86% Other (expense) income: Investment and other income 106,625 0% 144,529 0% (37,904) -26% Loss on sale of assets — 0% (822) 0% 822 -100% Fair value remeasurement of warrant liability (7,531,044) -10% (974,823) -2% (6,556,221) 673% Fair value remeasurement of embedded derivative liability — 0% (65,617) 0% 65,617 -100% Fair value remeasurement of contingent forward contract 899,080 1% — 0% 899,080 Fair value remeasurement of contingent value rights 36,079 0% 522,257 1% (486,178) -93% Financing fees (1,294,090) -2% — 0% (1,294,090) Interest expense (1,041,835) -1% (3,087,450) -5% 2,045,615 -66% Loss on debt extinguishment (343,471) 0% (35,657) 0% (307,814) 863% Other expense, net (9,168,656) -13% (3,497,583) -6% (5,671,073) 162% Operating loss from continuing operations before income taxes (10,841,693) -15% (15,814,986) -28% 4,973,293 -31% Income tax expense 51,140 0% 34,819 0% 16,321 47% Net loss $ (10,892,833) -15% (15,849,805) -28% $ 4,956,972 -31% 35 Consolidated sales increased 26% to $71,905,527 in 2025 from $56,861,753 in 2024, with a 31% increase within residential contract revenue and a 19% increase in service revenue, partially offset by a 1% decrease in commercial revenue.
Additionally, pursuant to the terms of that certain Senior Secured Contingent Note Instrument, entered into on April 10, 2025, the unearned 2024 earnout was rescheduled and shall be based on the earnout terms set forth therein pursuant to the financial conditions and terms covering each of fiscal years 2024 and 2025 and, if attained, shall be payable in fiscal year 2026, which payment is further conditioned on the continued employment of the note holders at the time of such earnout payment trigger date.
Additionally, pursuant to the terms of that certain Senior Secured Contingent Note Instrument, entered into on April 10, 2025, the unearned 2024 earnout was rescheduled and is based on the earnout terms set forth therein pursuant to the financial conditions and terms covering each of fiscal years 2024 and 2025 and, if attained, shall be payable in fiscal year 2026, which payment is further conditioned on the continued employment of the note holders at the time of such earnout payment trigger date.
We test goodwill for impairment annually on October 1 or more frequently if events and circumstances warrant. Such events and circumstances may be a significant change 37 in our business climate, economic and industry trends, legal factors, negative operating performance indicators, significant competition or changes in strategy.
We test goodwill for impairment annually on October 1 or more frequently if events and circumstances warrant. Such events and circumstances may be a significant change in our business climate, economic and industry trends, legal factors, negative operating performance indicators, significant competition or changes in strategy.
The preparation of these financial statements requires us to make estimates and judgments 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 amount of revenues and expenses during the reporting period.
The preparation of these financial statements requires us to make estimates and judgments 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 amount 33 of revenues and expenses during the reporting period.
New Accounting Pronouncements See Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements included elsewhere in this report for a discussion of new accounting standards. Off Balance Sheet Arrangements None.
New Accounting Pronouncements See Note 2, Summary of Significant Accounting Policies, to the Consolidated Financial Statements included elsewhere in this report for a discussion of new accounting standards. 38 Off Balance Sheet Arrangements None.
Our current business units, Hawaii Energy Connection, LLC (“HEC”), and New York-based subsidiaries, the SUNation entities (collectively, “SUNation”). are engaged in the design, installation, and maintenance of solar energy systems across residential, commercial, and municipal sectors. Our team specializes in providing tailored solar solutions that meet the specific energy needs of each client, ensuring both efficiency and sustainability.
Our current business units, Hawaii Energy Connection, LLC (“HEC”), and New York-based subsidiaries, the SUNation entities (collectively, “SUNation NY”). are engaged in the design, installation, and maintenance of solar energy systems across residential, commercial, and municipal sectors. Our team specializes in providing tailored solar solutions that meet the specific energy needs of each client, ensuring both efficiency and sustainability.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with the Company’s Consolidated Financial Statements and the related notes that appear elsewhere in this report. Overview SUNation Energy Inc. (formerly Communications Systems, Inc.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with the Company’s Consolidated Financial Statements and the related notes that appear elsewhere in this report. Overview SUNation Energy Inc.
Of this amount, $368,138 was invested in short-term money market funds that are not considered to be bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or other government agency.
Of this amount, $665,582 was invested in short-term money market funds that are not considered to be bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or other government agency.
On October 1, 2024, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-50 ratio (the “October Reverse Stock Split”) and approved an amendment (“October Reverse Stock Split Amendment”) to the Fourth Amended and Restated Articles of Incorporation of the Company to effect the October Reverse Stock Split.
On October 1, 2024, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-50 ratio (the “October Reverse Stock Split”) and approved an amendment (“October Reverse Stock Split Amendment”) to the Fourth Amended and Restated Articles of Incorporation of the Company to effect the October Reverse Stock Split. 32 Effective October 17, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the October Reverse Stock Split.
Effective June 12, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the June Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on June 12, 2024 (the "June Effective Date"). As a result of the June Reverse Stock Split, at 12:01 a.m.
Effective June 12, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the June Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on June 12, 2024 (the "June Effective Date").
On April 10, 2025, the original Long-Term Note was amended and restated as follows: The principal amount of $5,486,000 previously due and payable under the original Long Term Note, together with all accrued and unpaid interest owing thereunder, shall be due and payable on May 1, 2028 (the “Maturity Date”), and such amended note shall become a senior secured instrument.
On April 10, 2025, the Long-Term Note was amended and restated whereby the principal amount of $5,486,000 previously due and payable under the original Long-Term Note, together with all accrued and unpaid interest owing thereunder, shall be due and payable on May 1, 2028, and such amended note became a senior secured instrument.
Central Time on the June Effective Date, every 15 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share.
As a result of the June Reverse Stock Split on the June Effective Date, every 15 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share.
Central Time on the October Effective Date, every 50 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share.
As a result of the October Reverse Stock Split on the October Effective Date, every 50 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share.
As noted in Note 17, Subsequent Events, the Company raised capital and satisfied certain outstanding debt obligations subsequent to year end, however there remains uncertainty related to our future cash flows as it relies on the ability to generate enough cash flow from its operating segments to cover the Company’s corporate overhead costs.
As noted in Notes 8 and 11, the Company raised capital and satisfied certain outstanding debt obligations during 2025, however there remains uncertainty related to our future cash flows as it relies on the ability to generate enough cash flow from its operating segments to cover the Company’s corporate overhead costs.
Liquidity and Capital Resources As of December 31, 2024, the Company had approximately $1,151,348 in cash, restricted cash and cash equivalents, and liquid investments, compared to $5,396,343 at December 31, 2023.
Liquidity and Capital Resources As of December 31, 2025, the Company had approximately $7,182,344 in cash, restricted cash and cash equivalents, and liquid investments, compared to $1,151,348 at December 31, 2024.
Principal and interest payments under the amended Long-Term Note shall be payable monthly on the first day of each month commencing with June 1, 2025 for thirty-six (36) consecutive months thereafter pursuant to the terms thereunder.
Principal and interest payments under the amended Long-Term Note are payable monthly on the first day of each month commencing on June 1, 2025 for thirty-six consecutive months thereafter.
The total number of shares authorized for issuance was reduced from 133,333,333 to 2,666,667 in proportion to the October Reverse Stock Split ratio. The number of shares authorized for issuance was later increased to 25,000,000 as a result of the Reincorporation.
The total number of shares authorized for issuance was reduced from 133,333,333 to 2,666,667 in proportion to the October Reverse Stock Split ratio.
Cash flow used in operating activities was approximately $6,302,686 in 2024 compared to $667,177 used in 2023. The negative cash flow from operations is primarily driven by the decrease in the Company’s operating profit and the increase in interest expense.
Cash flow provided by operating activities was approximately $954,978 in 2025 compared to $6,302,686 used in operating activities in 2024. The positive cash flow from operations is primarily driven by the decrease in the Company’s operating loss and the decrease in interest expense.
Consolidated operating loss from continuing operation s before income taxes in 2024 was $15,814,986, compared to a consolidated operating loss from continuing operations before income taxes of $6,820,716 in 2023. Net loss from continuing operations attributable to shareholders in 2024 (after taking into effect $11,587,121 in deemed dividends) was $27,436,926, or ($50.58) per diluted share.
Consolidated operating loss before income taxes in 2025 was $10,841,693, compared to a consolidated operating loss before income taxes of $15,814,986 in 2024. Net loss in 2025 was $10,892,833, or ($4.38) per diluted share. Net loss attributable to shareholders in 2024 (after taking into effect $11,587,121 in deemed dividends) was $27,436,926, or ($10,110.93) per diluted share from continuing operations.
The Company also recorded a $3,101,981 goodwill impairment loss within the HEC segment and a $750,000 intangible asset impairment loss during 2024 related to technology related intangible assets within the HEC segment. Consolidated other income decreased $5,031,926 to expense of $(4,385,777) in 2024 as compared to income of $646,149 in 2023.
The Company also recorded a $3,101,981 goodwill impairment loss within the HEC segment and a $750,000 intangible asset impairment loss during 2024 related to technology related intangible assets within the HEC segment. Consolidated other expense increased $5,671,073 to expense of $9,168,656 in 2025 as compared to income of $3,497,583 in 2024.
It carried an annual interest rate of 4% until the first anniversary of issuance, then 8% thereafter until the Long-Term Note is paid in full. The Company was required to make a principal payment of $2.74 million on the second anniversary of the Long- Term Note. The Long-Term Note may be prepaid at our option at any time without penalty.
The Company was required to make a principal payment of $2.74 million on the second anniversary of the Long- Term Note. The Long-Term Note may be prepaid at our option at any time without penalty.
Effective as of the same time as the June 2024 Reverse Stock Split and October 2024 Reverse Stock Split (collectively known as the “Reverse Stock Splits”), the number of shares of common stock available for issuance under the Company's equity compensation plans were automatically reduced in proportion to the Reverse Stock Splits ratio.
Following each of the Reverse Stock Splits, the number of shares of common stock available for issuance under the Company's equity compensation plans were automatically reduced in proportion to the Reverse Stock Splits ratio.
Additionally, we provide community solar services that allow groups of individuals, businesses, or organizations to share the benefits of a single solar array, making renewable energy accessible to more people in the community. On June 30, 2023, the Company divested its legacy operations and operating assets through the sale of substantially all of the assets of its JDL Technologies, Inc.
Additionally, we provide community solar services that allow groups of individuals, businesses, or organizations to share the benefits of a single solar array, making renewable energy accessible to more people in the community.
Based on the Company’s current financial position, which includes approximately $0.3 million of restricted cash, cash equivalents and investments that are restricted under the CVR agreement and cannot be used by the Company for its own working capital needs, and the Company’s forecasted future cash flows for twelve months beyond the date of issuance of these financial statements, substantial doubt exists around the Company’s ability to continue as a going concern for a reasonable period of time .
Based on the Company’s current financial position and the Company’s forecasted future cash flows for twelve months beyond the date of issuance of these financial statements, substantial doubt exists around the Company’s ability to continue as a going concern for a reasonable period of time .
Gross margin increased slightly to 31.1% in 2024 compared to 30.5% in 2023. Selling, general and administrative expenses decreased 17% to $4,530,879 in 2024 (26% as a percentage of sales) as compared to $5,448,385 in 2023 (20% as a percentage of sales), due primarily to a decrease in commissions expense and gross excise taxes on lower revenue.
Selling, general and administrative expenses increased 5% to $4,766,477 in 2025 (21% as a percentage of sales) as compared to $4,530,879 in 2024 (26% as a percentage of sales), due primarily to an increase in commissions expense and gross excise taxes on higher revenue.
The Company had working capital of $(16,051,658), consisting of current assets of approximately $11,110,385 and current liabilities of $27,162,043 at December 31, 2024 compared to working capital of $(6,594,834), consisting of current assets of $15,778,648 and current liabilities of $22,373,482 at the end of 2023.
The Company had working capital of $1,066,408, consisting of current assets of approximately $16,473,979 and current liabilities of $15,407,571 at December 31, 2025 compared to a working capital deficit of $(16,051,658), consisting of current assets of $11,110,385 and current liabilities of $27,162,043 at December 31, 2024.
In the first half of 2024, the Battery Bonus program in Hawaii ended. Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Commercial contract sales decreased $951,207, or 32%, due to timing of projects.
Under this program, customers were paid a cash incentive and provided energy bill credits to add energy storage to an existing or new rooftop solar system. Commercial contract sales decreased $239,565, or 56%, due to timing of projects. HEC has limited commercial projects and the revenue from this revenue stream can fluctuate year over year.
Effective October 17, 2024, the Company amended its Fourth Amended and Restated Articles of Incorporation to implement the October Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on October 17, 2024 (the "October Effective Date"). 36 As a result of the October Reverse Stock Split, at 12:01 a.m.
On April 16, 2025, the Company amended its Certificate of Incorporation to implement the April Reverse Stock Split. The Company's common stock began trading on a split-adjusted basis when the market opened on April 21, 2025 (the "April Effective Date").
It carried an annual interest rate of 4% until the three-month anniversary of issuance, 8% thereafter until the six-month anniversary of issuance, then 12% thereafter until the Short-Term Note is paid in full. The Short-Term Note was paid in full in conjunction with the Decathlon loan. The Long-Term Note is unsecured and initially matured on November 9, 2025.
In connection with the SUNation NY acquisition, on November 9, 2022, the Company issued a $5,486,000 Long-Term Promissory Note (the “Long-Term Note”). The Long-Term Note was unsecured and matured on November 9, 2025. It carried an annual interest rate of 4% until the first anniversary of issuance, then 8% thereafter until the Long-Term Note was paid in full.
This was extended again through December 31, 2025 by the Second Amendment to the Contingent Value Rights Agreement entered into on December 30, 2024.
This was extended again through December 31, 2025 by the Second Amendment to the Contingent Value Rights Agreement entered into on December 30, 2024. The CVRs were settled during the fourth quarter of 2025, with a final distribution payment of $276,000 in December 2025. There are no further obligations during the CVRs.
Consolidated gross profit decreased 26% to $20,426,244 in 2024 as compared to gross profit of $27,696,190 in 2023 due primarily to the decrease in revenue at both SUNation and HEC. Gross margin increased to 35.9% in 2024 compared to 34.8% in 2023. Consolidated operating expenses decreased 6.9% to $32,743,647 in 2024 as compared to $35,163,055 in 2023.
Consolidated gross profit increased 35% to $27,544,213 in 2025 as compared to gross profit of $20,426,244 in 2024 due primarily to the increase in revenue an improvement in residential margins. Gross margin increased to 38.3% in 2025 compared to 35.9% in 2024. Consolidated operating expenses decreased 10.8% to $29,217,250 in 2025 as compared to $32,743,647 in 2024.
Consolidated selling, general and administrative expenses decreased 6.9% to $27,054,166 in 2024 from $29,074,578 in 2023, due primarily to a $1,830,189 decrease in selling, general and administrative costs associated with SUNation and HEC.
Consolidated selling, general and administrative expenses decreased 0.3% to $26,979,750 in 2025 from $27,054,166 in 2024, due primarily to a decrease in Corporate selling, general and administrative costs, partially offset by increases at HEC and SUNation NY.
Therefore, we consider an understanding of the variability and judgment required in making these estimates and assumptions to be critical in fully understanding and evaluating our reported financial results. Income Taxes: In the preparation of the Company’s consolidated financial statements, management calculates income taxes.
Therefore, we consider an understanding of the variability and judgment required in making these estimates and assumptions to be critical in fully understanding and evaluating our reported financial results. Goodwill: Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the assets acquired and liabilities assumed from acquisitions.
Amortization expense decreased by $1,900,977 to $2,837,500 in 2024 due to the completion of the amortization of certain intangible assets in late 2023. The fair value remeasurement related to the SUNation acquisition earnout consideration in 2024 was a gain of $1,000,000 compared to a loss of $1,350,000 in 2023.
Amortization expense decreased by $600,000 to $2,237,500 in 2025 due to the write down of the technology intangible asset at HEC at December 31, 2024, resulting in lower amortization expense in the current year. There was a $1,000,000 decrease in a fair value remeasurement gainrelated to the SUNation NY acquisition earnout consideration in 2025 as compared to 2024.
Sales in 2024 and 2023 by type were as follows: Revenue by Type 2024 2023 Residential contracts $ 30,715,255 $ 39,326,408 Commercial contracts 6,700,469 9,903,437 Service revenue 2,317,638 3,133,865 $ 39,733,362 $ 52,363,710 Residential contract sales decreased $8,611,153, or 22%, due to a 12% reduction in residential kilowatts installed and a decrease in average price per system installed as result of lower financing fees.
Sales in 2025 and 2024 by type were as follows: Revenue by Type 2025 2024 Residential contracts $ 40,215,497 $ 30,715,255 Commercial contracts 6,894,923 6,700,469 Service revenue 2,489,891 2,317,638 $ 49,600,311 $ 39,733,362 Residential contract sales increased $9,500,242, or 31%, due to a 25% increase in systems installed and a 40% increase in kilowatts installed.
Selling, general and administrative expenses decreased 6% to $15,265,443 in 2024 (38% as a percentage of sales) as compared to $16,178,126 in 2023 (31% as a percentage of sales), due primarily to a decrease in personnel costs on lower headcount. 40 Amortization expense decreased 40% to $812,500 in 2024 as compared to $1,362,500 in 2023 due to certain intangible assets becoming fully amortized at the end of 2023.
The higher residential margins are driven by lower material costs as a percentage of sales. 36 Selling, general and administrative expenses increased 6% to $16,237,256 in 2025 (33% as a percentage of sales) as compared to $15,265,443 in 2024 (38% as a percentage of sales), due primarily to an increase in selling and marketing expenses on higher residential contract revenue, partially offset by a decrease in personnel costs on lower headcount.
Sales in 2024 and 2023 by type were as follows: Revenue by Type 2024 2023 Residential contracts $ 15,984,618 $ 24,855,946 Commercial contracts 429,259 1,380,466 Service revenue 714,514 673,544 Software revenue — 347,550 Other — 11,493 $ 17,128,391 $ 27,268,999 Residential contract sales decreased $8,871,328, or 36%, due to a 12% reduction in residential kilowatts installed and a decrease in average price per system installed as result of a 51% decrease in battery capacity installed.
Sales in 2025 and 2024 by type were as follows: Revenue by Type 2025 2024 Residential contracts $ 20,993,980 $ 15,984,618 Commercial contracts 189,694 429,259 Service revenue 1,121,542 714,514 $ 22,305,216 $ 17,128,391 Residential contract sales increased $5,009,362, or 31%, despite a 2% decrease in systems installed, due to a 9% increase in kilowatts installed, a 66% increase in battery capacity installed and a 20% increase in price per watt installed.
There was no impairment indication within our SUNation reporting unit as there was adequate cushion of 80% between the fair value and carrying value of the reporting unit. No goodwill impairment was recorded during the year ended December 31, 2023.
Based on the results of this analysis, we concluded that there was no impairment indication within our HEC and SUNation NY reporting units between the fair value and carrying value of the reporting units.
Corporate general and administrative expenses decreased 2.6% or $190,223 to $7,257,844 due primarily to a $1,103,039 decrease in expenses associated with Legacy CSI assets and a $1,183,954 decrease in stock compensation expense, partially offset by $1,300,000 in expense on loss contingencies related to certain prior securities issuances and an increase in legal and professional fees on the corporate restructuring efforts during 2024.
Corporate general and administrative expenses decreased 17.7% or $1,281,827 to $5,976,017 due primarily to $1,300,000 in expense in the prior year on loss contingencies related to certain prior securities issuances.
Gross profit decreased 22% to $15,093,668 in 2024 as compared to gross profit of $19,370,809 in 2023 due primarily to the decrease in revenue. Gross margin increased to 38.0% in 2024 compared to 37.0% in 2023 due primarily to an increase in residential gross margins on lower financing fees in 2024.
Gross profit increased 34% to $20,166,363 in 2025 as compared to gross profit of $15,093,667 in 2024 due primarily to the increase in revenue and additional increase in gross margin.
Concurrently with the Reincorporation, the Company also effectuated a change to its name from Pineapple Energy, Inc. to SUNation Energy, Inc., and to its stock trading symbol from PEGY to SUNE, effective November 19, 2024. SUNation Energy’s vision is to power the energy transition through grass-roots growth of solar electricity paired with battery storage.
(herein referred to as “SUNation Energy,” “SUNE,” “our,” “we” or the “Company”) is a Delaware corporation, whose shares of Common Stock are listing on the Nasdaq Stock Market under its trading symbol “SUNE”. SUNation Energy’s vision is to power the energy transition through grass-roots growth of solar electricity paired with battery storage.
Cash used in investing activities was $26,667 in 2024 compared to $3,567,278 provided in 2023.
Cash used in investing activities was $48,594 in 2025 compared to $26,667 used in 2024 primarily related to capital expenditures. Net cash provided by financing activities was $5,124,612 in 2025 compared to $2,084,358 provided in 2024.
Removed
(“CSI”), Pineapple Holdings, Inc. and Pineapple Energy Inc.) (herein referred to as “SUNation Energy,” “SUNE,” “our,” “we” or the “Company”) was originally organized as a Minnesota corporation in 1969.
Added
The Company's common stock began trading on a split-adjusted basis when the market opened on October 17, 2024 (the "October Effective Date").
Removed
On March 28, 2022, the Company completed its previously announced merger transaction with Pineapple Energy LLC (“Pineapple Energy”) in accordance with the terms of a merger agreement, pursuant to which a subsidiary of the Company merged with and into Pineapple Energy, with Pineapple Energy surviving the merger as a wholly owned subsidiary of the Company (the “merger”).
Added
April 2025 Reverse Stock Split On April 3, 2025, the Company’s shareholders approved a reverse stock split of the Company’s common stock at a ratio within a range of 1-for-2 and 1-for-200 and granted the Company’s board of directors the discretion to determine the timing and ratio of the split within such range.
Removed
Following the closing of the merger (the “Closing”) the Company changed its name from Communications Systems, Inc. to Pineapple Holdings, Inc. and subsequently, on April 13, 2022, changed its name to Pineapple Energy Inc.
Added
Additionally, the shareholders also approved an increase in authorized shares to 1,000,000,000 shares.
Removed
On November 14, 2024, the Company filed articles of conversion with the Secretary of State of the State of Minnesota and filed a certificate of conversion with the Secretary of State of the State of Delaware changing its jurisdiction of incorporation from Minnesota to Delaware (the “Reincorporation”), as well as having filed a Certificate of Incorporation with the Secretary of State of the State of Delaware on this same date.
Added
On April 9, 2025, the Company’s board of directors determined to effect the reverse stock split of the common stock at a 1-for-200 ratio (the “April Reverse Stock Split”) and approved an amendment (“April Reverse Stock Split Amendment”) to its Certificate of Incorporation to effect the April Reverse Stock Split.
Removed
(“JDL”) and Ecessa Corporation (“Ecessa”) businesses. See Note 5, Discontinued Operations. As a result, unless otherwise noted, all information in this report on Form 10-K related to the JDL and Ecessa businesses are discussed and presented as discontinued operations and the Company reports its remaining business operations as continuing operations.
Added
As a result of the April Reverse Stock Split on the April Effective Date, every 200 shares of common stock then issued and outstanding automatically were combined into one share of common stock, with no change in par value per share.
Removed
Bitcoin Strategy WE ARE NOT REGISTERED AS AN INVESTMENT COMPANY UNDER THE INVESTMENT COMPANY ACT OF 1940 AND STOCKHOLDERS DO NOT HAVE THE PROTECTIONS ASSOCIATED WITH OWNERSHIP OF SHARES IN A REGISTERED INVESTMENT COMPANY NOR THE PROTECTIONS AFFORDED BY THE COMMODITIES EXCHANGE ACT.
Added
No fractional shares were outstanding following the April Reverse Stock Split, and any fractional shares that would have resulted from the April Reverse Stock Split were rounded up to the nearest whole share. The number of shares of common stock outstanding was reduced from 672,799,910 to 3,406,614.
Removed
In January 2025, our board of directors approved and adopted a corporate treasury strategy, adopting the inclusion of bitcoin (“BTC”) as a treasury reserve asset on an ongoing basis, subject to, among other factors, market conditions, the Company’s operational requirements, including in support of its planned expansion strategy, and our anticipated cash needs, instead of solely looking to keep cash in short and intermediate-term, interest-bearing obligations, investment-grade instruments, certificates of deposit or direct or guaranteed obligations of the U.S. federal government.
Added
The effects of the June 2024 Reverse Stock Split, October 2024 Reverse Stock Split, and April 2025 Reverse Stock Split (collectively known as the “Reverse Stock Splits”) have been applied retroactively and are reflected in this Annual Report on Form 10-K for all periods presented.
Removed
As part of this strategy, we may allocate a minority portion of our excess cash, calculated based on our estimated six-month operating expenses, toward BTC purchases. 35 Since 2003, we have been designing, developing, and providing solar energy solutions tailored to customers in the information technology and technology sectors.
Added
During the third quarter of 2025, as a result of a material decline forecasted revenues and operating results due to the implications of the OBBBA, we performed an interim quantitative analysis as of September 30, 2025.
Removed
The Company believes this BTC initiative further solidifies its role in supporting the new digital economy and its expanding energy needs in an environmentally conscious manner. Accordingly, this strategic initiative aligns with the Company’s goal to enable BTC as a possible payment option for its customers and suppliers as part of its core mission to make solar power more accessible.
Added
There was no impairment indication within our SUNation NY reporting unit. 34 Recoverability of Long-Lived Assets and Intangible Assets: The Company reviews its long-lived assets and definite lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable.
Removed
We believe it has unique characteristics as a scarce and finite asset that can serve as a reasonable inflation hedge and safe haven amid global instability. Bitcoin is often compared by some to gold, the latter of which has been viewed as a dependable store of value throughout history.
Added
If indicators of impairment exist, management identifies the asset group that includes the potentially impaired long-lived asset, at the lowest level at which there are separate, identifiable cash flows.
Removed
As of January 3, 2025, the total market capitalization of gold was approximately $17.8 trillion compared to nearly $1.95 trillion for bitcoin. Bitcoin is a highly volatile asset that has traded below $38,000 per bitcoin and above $108,000 per bitcoin on Coinbase in the 12 months preceding the date of this annual report.
Added
If the fair value for the asset is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset.
Removed
While highly volatile, bitcoin’s price has also appreciated significantly since bitcoin’s inception in January 2009 (at zero per bitcoin). We believe that a substantial portion of bitcoin’s appreciation is attributable to the view that bitcoin is or will become a reliable store of value.
Added
During the third quarter of 2025, as a result of the OBBBA, the Company performed an impairment test on the tradenames and trademarks intangible assets associated with both the HEC and SUNation NY reporting units as of September 30, 2025. The Company performed the analysis under ASC 360 and no impairment charge was realized.
Removed
Like gold, bitcoin is also viewed as a scarce asset; the ultimate supply of bitcoin is limited to 21 million coins and approximately 94.5% of its supply already exists. We believe that bitcoin’s finite, digital and decentralized nature as well as its architectural resilience make it a highly attractive and potentially highly appreciable asset.
Added
On a consolidated basis, overall kilowatts installed on residential projects increased 31% and revenue per residential installation increased 31% in 2025 as compared to 2024.
Removed
We also believe that the growing global acceptance across sectors, public and private companies and other “institutionalization” of bitcoin, including in some governments integrating bitcoin into their financial strategies as a hedge against inflation, macro-economic instability, and geopolitical risks facing global economies, supports our view that bitcoin is a reliable store of value.
Added
The overall increase in residential revenue is driven by increased customer demand to install solar systems prior to the expiration of federal tax credits at December 31, 2025 under the passing of the One Big Beautiful Bill Act.
Removed
We believe that bitcoin’s unique attributes discussed above not only differentiate it from fiat money, but also from other cryptocurrency assets, and for that reason, we have no plans to purchase cryptocurrency assets other than bitcoin.
Added
The increase was primarily related to a $6,556,221 increase in the fair value remeasurement loss on the warrant liability, $1,294,090 in financing fees primarily on the issuance of the contingent forward contract and issuance of Series A and Series B warrants, a $486,178 decrease in fair value remeasurement gain on the contingent value rights (“CVRs”), and a $307,814 increase in loss on debt extinguishment, partially offset by a $65,617 decrease in fair value remeasurement loss on the embedded derivative liability, a $899,080 increase in fair value remeasurement gain on the contingent forward contract, and a $2,045,615 decrease in interest expense.
Removed
This includes estimating the Company’s current tax liability as well as assessing temporary differences resulting from different treatment of items for tax and book accounting purposes. These differences result in deferred tax assets and liabilities, which are recorded on the balance sheet.
Added
SUNation NY Operating Results SUNation NY sales increased 25% or $9,866,949, to $49,600,311 in 2025 as compared to $39,733,362 in 2024.
Removed
These assets and liabilities are analyzed regularly and management assesses the likelihood it will realize these deferred assets from future taxable income. We determine the valuation allowance for deferred income tax benefits based upon the expectation of whether the benefits are more likely than not to be realized.
Added
The overall increase in residential revenue is driven by increased customer demand to install solar systems prior to the expiration of federal tax credits at December 31, 2025 under the passing of the One Big Beautiful Bill Act. Commercial contract sales increased $194,454, or 3%, due primarily to the timing of commercial projects.
Removed
The Company records interest and penalties related to income taxes as income tax expense in the consolidated statements loss and comprehensive loss. Goodwill: Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the assets acquired and liabilities assumed from acquisitions.
Added
Gross margin increased to 40.7% in 2025 compared to 38.0% in 2024 due primarily to revenue mix with higher margin residential revenue making a larger percentage of the total revenue in 2025 as compared to 2024.
Removed
As of October 1, 2024, we performed a qualitative assessment to evaluate any circumstances and events impacting our reporting units to determine the likelihood of goodwill impairment. We concluded it was more likely than not that the fair value of our reporting units exceeded its carrying value.
Added
Amortization expense remained flat at $812,500 in 2025 as compared to 2024. HEC Operating Results HEC sales increased 30% or $5,176,825, to $22,305,216 in 2025 as compared to $17,128,391 in 2024.

… 30 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed1 unchanged
Biggest changeThe Company’s investments are in money markets that earn interest at prevailing market rates and as such do not have material risk exposure. Based on the Company’s operations, in the opinion of management, the Company is not exposed to material future losses due to market risk. ‎ 43
Biggest changeThe Company’s investments are in money markets that earn interest at prevailing market rates and as such do not have material risk exposure. Based on the Company’s operations, in the opinion of management, the Company is not exposed to material future losses due to market risk. ‎ 39

Other SUNE 10-K year-over-year comparisons