Financial Performance - Consolidated sales increased by $4,275,250, or 29.0%, to $18,993,636 in Q3 2025 from $14,718,386 in Q3 2024, driven by a 54% increase in residential contract revenue and a 72% increase in service revenue [215]. - Gross profit rose to $7,211,685 in Q3 2025, up from $5,235,725 in Q3 2024, with gross margin increasing to 38% from 36% [216]. - The net loss for Q3 2025 was $392,975, a significant improvement from a net loss of $3,298,609 in Q3 2024, reflecting an 88.1% reduction in losses [215]. - Consolidated sales for the first nine months of 2025 increased by $3,207,525, or 7.7%, to $44,694,528 compared to the same period in 2024 [226]. - Consolidated gross profit for the first nine months of 2025 was $16,482,527, an increase of 11.1% from $14,833,527 in 2024 [228]. - Net loss for the first nine months of 2025 was $13,496,822, or $(6.19) per diluted share, compared to a net loss of $20,617,094, or $(25,596.09) per diluted share in the same period of 2024 [231]. Operating Expenses - Operating expenses increased by 9% to $7,457,416 in Q3 2025 compared to $6,842,462 in Q3 2024, with selling, general and administrative expenses rising by 12% to $6,898,041 [217]. - Selling, general and administrative expenses for the first nine months of 2025 were $19,381,068, a slight increase of 0.3% from $19,321,037 in 2024 [229]. - Selling, general and administrative expenses remained flat at $3,117,988 in the first nine months of 2025, representing 25% of sales, compared to 27% in the same period of 2024 [238]. Revenue Growth - The overall kilowatts installed on residential projects increased by 52%, with revenue per residential installation increasing by 25% in Q3 2025 compared to Q3 2024 [215]. - SUNation NY revenue increased by 22%, or $2,375,056, to $13,014,951 in Q3 2025, driven by a 52% increase in residential contract revenue [220]. - HEC sales increased by 47%, or $1,900,194, to $5,978,685 in Q3 2025, with residential contract sales up 59% [223]. - HEC sales for the first nine months of 2025 increased by 8%, or $951,683, to $12,314,174, with residential contract sales up 7% [235]. - Service revenue increased by $423,382, or 77%, due to an increase in repair and replacement installations in the first half of 2025 [236]. Cash Flow and Financing - Cash used in operating activities decreased to $1,146,338 in the first nine months of 2025 from $4,393,846 in the same period of 2024 [242]. - Net cash provided by financing activities was $5,716,316 in the first nine months of 2025, significantly up from $1,183,220 in the same period of 2024 [244]. - The company raised $20.0 million in securities through a purchase agreement with institutional investors, using proceeds to pay off approximately $12.6 million in outstanding debt [247]. - The company issued a $5,486,000 Long-Term Promissory Note in connection with the SUNation NY acquisition, which was amended to extend the maturity to May 1, 2028 [245]. Other Financial Metrics - Consolidated other expenses decreased by $1,560,798 to $130,565 in Q3 2025 compared to $1,691,363 in Q3 2024, primarily due to a decrease in interest expense [218]. - Amortization expense decreased by $150,000 to $559,375 in Q3 2025 due to the write-down of a technology intangible asset [217]. - The overall price per watt on residential projects increased slightly by 2% in Q3 2025 compared to Q3 2024 [215]. - The estimated fair value of the Contingent Value Rights (CVR) liability as of September 30, 2025, was $288,948, representing the legacy assets to be distributed to CVR holders [248]. Company Outlook - The company anticipates increased customer demand for solar systems prior to the expiration of federal tax credits at the end of 2025 [215]. - Substantial doubt exists regarding the company's ability to continue as a going concern due to uncertainty around future cash flows and the need for additional funding [246]. - The company had a working capital deficit of $(1,848,119) as of September 30, 2025, compared to $(16,051,658) at December 31, 2024 [241]. Losses and Improvements - Consolidated operating loss in Q3 2025 was $245,731, significantly improved from a loss of $1,606,737 in Q3 2024 [219]. - Net loss in Q3 2025 was $392,975, or $(0.12) per diluted share, compared to a net loss of $3,563,091, or $(2,350.12) per diluted share in Q3 2024 [219].

[Sales Agreement Overview](index=1&type=section&id=Sales%20Agreement%20Overview) Details the agreement between SUNation Energy, Inc. and Needham & Company, LLC for an "at-the-market" common stock offering [1. Issuance and Sale of Shares](index=1&type=section&id=1.%20Issuance%20and%20Sale%20of%20Shares) Outlines the terms for SUNation Energy to sell up to $30,000,000 of common stock through an ATM offering via Needham & Company ATM Offering Details | Item | Detail | | :--- | :--- | | **Company** | SUNation Energy, Inc. | | **Sales Agent** | Needham & Company, LLC | | **Agreement Date** | August 18, 2025 | | **Security** | Common Stock, par value $0.05 per share | | **Aggregate Offering Amount** | Up to $30,000,000 | - The issuance and sale of shares are contingent upon several limitations, collectively referred to as the "Maximum Amount", including the amount registered on the effective Registration Statement, the number of authorized but unissued shares, and limits under Form S-3[2](index=2&type=chunk) - The offering will be conducted pursuant to the Company's Registration Statement on Form S-3 (File No. 333-267066), which was declared effective by the SEC on April 29, 2025[2](index=2&type=chunk)[3](index=3&type=chunk) [2. Placements](index=2&type=section&id=2.%20Placements) Describes the process for the Company to initiate share sales by sending a Placement Notice to the Sales Agent - To initiate a sale, the Company must deliver a Placement Notice to the Sales Agent specifying the terms of the desired sale, including volume, timing, and minimum price[5](index=5&type=chunk) - The Sales Agent is not obligated to proceed with any Placement and may decline the terms of a Placement Notice in its sole discretion[5](index=5&type=chunk) - The compensation for the Sales Agent is determined according to Schedule 2 of the agreement[5](index=5&type=chunk) [3. Sale of Placement Shares by the Sales Agent](index=2&type=section&id=3.%20Sale%20of%20Placement%20Shares%20by%20the%20Sales%20Agent) Specifies the Sales Agent's commitment to use commercially reasonable efforts for "at the market" share sales - The Sales Agent will use commercially reasonable efforts consistent with its normal trading practices to sell the Placement Shares[6](index=6&type=chunk) - Sales methods are those permitted for an "at the market offering" under Rule 415(a)(4), including sales on the Nasdaq Capital Market or in negotiated transactions[6](index=6&type=chunk) - The Sales Agent is not obligated to purchase shares as a principal and bears no liability for not selling shares, other than for a failure to use commercially reasonable efforts[6](index=6&type=chunk) [4. Suspension of Sales](index=3&type=section&id=4.%20Suspension%20of%20Sales) Allows either party to suspend sales, mandating cessation when the Company holds material non-public information - Both the Company and the Sales Agent have the right to suspend sales by giving notice to the other party[7](index=7&type=chunk) - Sales are prohibited, and the Company must not request sales, during any period in which the Company is in possession of material non-public information[8](index=8&type=chunk) [5. Settlement and Delivery](index=3&type=section&id=5.%20Settlement%20and%20Delivery) Details the T+1 settlement process for share sales, including net proceeds calculation and electronic delivery - Settlement for sales typically occurs on the first trading day following the trade date[9](index=9&type=chunk) - Net Proceeds are calculated as the aggregate gross sales price less the Sales Agent's commission and any transaction fees[9](index=9&type=chunk) - The Company is obligated to deliver the Placement Shares electronically via its transfer agent on the Settlement Date. Failure to do so will result in the Company holding the Sales Agent harmless for any resulting losses[10](index=10&type=chunk) [6. Representations and Warranties of the Company](index=4&type=section&id=6.%20Representations%20and%20Warranties%20of%20the%20Company) The Company provides assurances regarding its SEC filings, corporate status, financial health, and legal compliance [SEC Filings and Compliance](index=4&type=section&id=SEC%20Filings%20and%20Compliance) The Company warrants its SEC filings, Form S-3 eligibility, and the absence of material misstatements or stop orders - The Company confirms its eligibility to use Form S-3 and that the Registration Statement for the offering has been declared effective by the SEC[13](index=13&type=chunk) - It is warranted that the Registration Statement and Prospectus comply with SEC rules and do not contain any untrue statements of a material fact or omit material facts[13](index=13&type=chunk)[14](index=14&type=chunk) - The Company represents that no stop order suspending the effectiveness of the Registration Statement has been issued or is being threatened by the SEC[13](index=13&type=chunk) [Corporate Structure and Capitalization](index=6&type=section&id=Corporate%20Structure%20and%20Capitalization) The Company assures its corporate standing, validly issued shares, and compliance with public float requirements - The Company and its subsidiaries are duly organized, validly existing, and in good standing in their respective jurisdictions[21](index=21&type=chunk) - The Placement Shares have been duly authorized and, upon issuance and payment, will be validly issued, fully paid, and nonassessable[22](index=22&type=chunk) - The Company meets the public float requirement of at least **$75 million** for the use of Form S-3, as calculated within 60 days of its most recent annual report filing[23](index=23&type=chunk) [Financial Matters and Disclosures](index=8&type=section&id=Financial%20Matters%20and%20Disclosures) The Company warrants its financial statements conform to GAAP, auditors are independent, and no Material Adverse Effect has occurred - The financial statements incorporated by reference in the Registration Statement and Prospectus fairly present the Company's financial condition in accordance with GAAP[25](index=25&type=chunk) - The Company's auditors, CBIZ LLC and UHY LLP, are independent registered public accounting firms as required by the Act and PCAOB[25](index=25&type=chunk) - There has been no Material Adverse Effect or Material Adverse Change in the Company's business, financial condition, or prospects since the date of the latest financial information provided in the Prospectus[27](index=27&type=chunk) [Legal and Operational Compliance](index=9&type=section&id=Legal%20and%20Operational%20Compliance) The Company represents compliance across litigation, intellectual property, tax, environmental, anti-corruption, and SOX - The Company is not involved in any pending or threatened litigation that would reasonably be expected to have a Material Adverse Effect[30](index=30&type=chunk) - The Company and its subsidiaries own or have adequate rights to all Intellectual Property necessary to conduct their business[40](index=40&type=chunk) - The Company is in compliance with the Sarbanes-Oxley Act, and its principal officers have made all required certifications under Sections 302 and 906[46](index=46&type=chunk) - The Company maintains effective internal controls over financial reporting and disclosure controls and procedures[48](index=48&type=chunk)[49](index=49&type=chunk) - The Company represents that it is not a party to any other "at the market" or continuous equity transaction agreement[59](index=59&type=chunk) [7. Agreements of the Company](index=15&type=section&id=7.%20Agreements%20of%20the%20Company) The Company commits to ongoing filing, reporting, financial covenants, and due diligence support for the Sales Agent [Filing and Reporting Obligations](index=15&type=section&id=Filing%20and%20Reporting%20Obligations) The Company agrees to maintain registration effectiveness, file amendments, and notify the Sales Agent of SEC communications - The Company will promptly notify the Sales Agent of any SEC requests for amendments, the issuance of any stop order, or any other significant communication from the Commission[64](index=64&type=chunk) - If any event occurs that requires an amendment or supplement to the Prospectus to ensure it is not misleading, the Company will promptly prepare and file such amendment and suspend sales until it is effective[67](index=67&type=chunk) - The Company agrees to file a prospectus supplement with the SEC detailing the number of shares sold, net proceeds, and compensation, which may be satisfied by inclusion in its periodic Form 10-K or 10-Q reports[82](index=82&type=chunk) [Financial Covenants and Expenses](index=18&type=section&id=Financial%20Covenants%20and%20Expenses) The Company commits to paying all offering expenses and using proceeds as disclosed, with caps on Sales Agent reimbursement Expense Reimbursement Caps for Sales Agent | Expense Category | Reimbursement Cap | | :--- | :--- | | Establishment of ATM Program | **$100,000** | | Each Periodic Update of ATM Program | **$7,500** | - The Company will use the net proceeds from the offering in the manner described under the "Use of Proceeds" section of the Prospectus[76](index=76&type=chunk) [Due Diligence and Certification](index=20&type=section&id=Due%20Diligence%20and%20Certification) The Company agrees to provide ongoing officer certificates, legal opinions, and comfort letters on Representation Dates - The Company must provide an officer's certificate reaffirming its representations and warranties on each "Representation Date," which includes the filing of annual (10-K) and quarterly (10-Q) reports[83](index=83&type=chunk) - Within five trading days of each Representation Date, the Company must cause its counsel to furnish a legal opinion and negative assurance letter to the Sales Agent[84](index=84&type=chunk) - Similarly, within five trading days of each Representation Date, the Company must cause its independent accountants to furnish a "Comfort Letter" to the Sales Agent[85](index=85&type=chunk) [8. Conditions of the Obligations of the Sales Agent](index=22&type=section&id=8.%20Conditions%20of%20the%20Obligations%20of%20the%20Sales%20Agent) Outlines prerequisites for the Sales Agent's obligation to sell shares, including effective registration and accurate company warranties - The Registration Statement must be effective, and no stop order from the SEC can be pending or threatened[89](index=89&type=chunk)[90](index=90&type=chunk) - The Company's representations and warranties must remain true and correct, and it must have performed all its covenants under the agreement[95](index=95&type=chunk) - The Sales Agent must have received all required deliverables, including the officer's certificate (Section 7(s)), legal opinions (Section 7(t)), and accountant's Comfort Letter (Section 7(u))[96](index=96&type=chunk)[97](index=97&type=chunk)[98](index=98&type=chunk) - There must not have been any Material Adverse Effect or Material Adverse Change in the Company's business or a suspension of trading of its stock on the Exchange[93](index=93&type=chunk)[101](index=101&type=chunk) [9. Indemnification and Contribution](index=24&type=section&id=9.%20Indemnification%20and%20Contribution) Details mutual indemnification provisions, with the Company providing broad coverage and the Sales Agent limited to its furnished information - The Company provides broad indemnification to the Sales Agent against losses from material misstatements or omissions in the offering documents[106](index=106&type=chunk) - The Sales Agent's indemnification to the Company is limited to losses arising from information furnished in writing by the Sales Agent specifically for use in the offering documents[107](index=107&type=chunk) - The agreement includes contribution provisions, which allocate liability based on relative benefits and fault if direct indemnification is unavailable[110](index=110&type=chunk) [10. Reimbursement of Certain Expenses](index=27&type=section&id=10.%20Reimbursement%20of%20Certain%20Expenses) The Company agrees to quarterly reimbursement of the Sales Agent's reasonable legal and other defense expenses - The Company agrees to reimburse the Sales Agent quarterly for reasonable legal and other expenses incurred in defending claims related to the offering[114](index=114&type=chunk) [11. Termination](index=27&type=section&id=11.%20Termination) Specifies conditions for agreement termination by either party, including immediate termination for adverse events or 10-day notice - The Sales Agent can terminate the agreement immediately for causes such as a Material Adverse Effect, trading suspension, or a general banking moratorium[115](index=115&type=chunk) - Both the Company and the Sales Agent can terminate the agreement in their sole discretion with 10 days' prior notice[116](index=116&type=chunk)[117](index=117&type=chunk) - Obligations related to expenses (Section 7(i)), indemnification (Section 9), and reimbursement (Section 10) survive the termination of the agreement[118](index=118&type=chunk) [12. No Fiduciary Relationship](index=28&type=section&id=12.%20No%20Fiduciary%20Relationship) Clarifies that the Sales Agent acts solely as an agent in an arm's-length transaction, without fiduciary duties - The agreement is defined as an arm's-length commercial transaction, and the Sales Agent is not acting as a fiduciary or advisor to the Company[120](index=120&type=chunk) [13. Miscellaneous](index=28&type=section&id=13.%20Miscellaneous) Covers standard legal clauses, including New York governing law, jury trial waiver, and the agreement constituting the entire understanding - The agreement is governed by the laws of the State of New York[126](index=126&type=chunk) - Both parties waive their right to a trial by jury in any claim arising from the agreement[131](index=131&type=chunk) - The agreement constitutes the entire understanding between the parties and supersedes all prior agreements[125](index=125&type=chunk) [Schedules and Forms](index=33&type=section&id=Schedules%20and%20Forms) Provides templates and specific details for operational aspects of the sales agreement, including notices and compensation [Schedule 1: Form of Placement Notice](index=33&type=section&id=Schedule%201%3A%20Form%20of%20Placement%20Notice) Template for the Company to instruct the Sales Agent on share sales, specifying volume, price, and period [Schedule 2: Compensation](index=34&type=section&id=Schedule%202%3A%20Compensation) Details the Sales Agent's compensation, set at 3% of the aggregate gross proceeds from share sales Sales Agent Compensation | Metric | Rate | | :--- | :--- | | Commission Rate | **3%** of aggregate gross proceeds | [Schedule 3: Notice Parties](index=35&type=section&id=Schedule%203%3A%20Notice%20Parties) Lists authorized contacts for official communications between the Company and the Sales Agent [Schedule 4: Permitted Free Writing Prospectus](index=36&type=section&id=Schedule%204%3A%20Permitted%20Free%20Writing%20Prospectus) States that no Permitted Free Writing Prospectuses are associated with this offering - No Permitted Free Writing Prospectuses are listed for this offering[150](index=150&type=chunk) [Form of Representation Date Certificate](index=37&type=section&id=Form%20of%20Representation%20Date%20Certificate) Template for the officer's certificate reaffirming company representations and warranties on Representation Dates

[Part I. Financial Information](index=2&type=section&id=Part%20I.%20Financial%20Information) This section presents the unaudited condensed consolidated financial statements and management's analysis of financial condition and operations [Item 1. Financial Statements (Unaudited)](index=2&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, changes in equity, and cash flows, along with detailed notes explaining the company's business, accounting policies, revenue recognition, intangible assets, commitments, related party transactions, equity, income taxes, segment information, fair value measurements, and going concern status [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's assets, liabilities, and equity at specific reporting dates Balance Sheet Summary | Metric | June 30, 2025 | December 31, 2024 | | :----------------------------------- | :-------------- | :------------------ | | **Assets** | | | | Total Current Assets | $10,951,412 | $11,110,385 | | Property, Plant and Equipment, net | $1,107,372 | $1,238,898 | | Goodwill | $17,443,869 | $17,443,869 | | Intangible assets, net | $11,102,083 | $12,220,833 | | Total Assets | $44,129,850 | $45,712,732 | | **Liabilities & Equity** | | | | Total Current Liabilities | $12,801,792 | $27,162,043 | | Total Long-Term Liabilities | $9,226,016 | $10,003,273 | | Total Stockholders' Equity | $22,102,042 | $8,547,416 | - Total Current Liabilities significantly decreased from **$27,162,043** at December 31, 2024, to **$12,801,792** at June 30, 2025, primarily due to reductions in current portions of loans payable and earnout consideration[10](index=10&type=chunk) - Total Stockholders' Equity increased substantially from **$8,547,416** at December 31, 2024, to **$22,102,042** at June 30, 2025[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's revenues, expenses, and net loss over specific reporting periods Consolidated Statements of Operations Summary | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Sales | $13,064,254 | $13,549,420 | $25,700,892 | $26,768,617 | | Gross profit | $4,839,517 | $4,792,354 | $9,270,842 | $9,597,802 | | Operating loss | $(2,163,587) | $(2,025,944) | $(4,330,935) | $(4,208,898) | | Net loss | $(9,607,415) | $(6,934,015) | $(13,103,847) | $(5,731,364) | | Basic net loss per share | $(3.14) | $(11,022.91) | $(8.42) | $(38,216.49) | | Diluted net loss per share | $(3.14) | $(11,022.91) | $(8.42) | $(38,216.49) | - Net loss increased by **$2,673,400** (38.6%) for the three months ended June 30, 2025, compared to the same period in 2024, primarily due to a significant increase in fair value remeasurement loss on warrant liability and financing fees[14](index=14&type=chunk)[218](index=218&type=chunk) - Basic and diluted net loss per share improved significantly from **$(11,022.91)** to **$(3.14)** for the three months ended June 30, 2025, largely due to an increase in weighted average shares outstanding following reverse stock splits[14](index=14&type=chunk)[44](index=44&type=chunk) [Condensed Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Redeemable%20Convertible%20Preferred%20Stock%20and%20Stockholders'%20Equity%20(Deficit)) This section outlines changes in the company's equity, including stock issuances, warrant exercises, and reverse stock splits - Total Stockholders' Equity increased from **$8,547,416** at December 31, 2024, to **$22,102,042** at June 30, 2025, driven by significant issuances of common stock under registered direct offerings and Series B warrant exercises[16](index=16&type=chunk) Common Stock and Additional Paid-in Capital Changes (Six Months Ended June 30, 2025) | Activity | Common Stock Shares | Common Stock Amount | Additional Paid-in Capital | | :------------------------------------------ | :-------------------- | :------------------ | :------------------------- | | Balance at December 31, 2024 | 9,343 | $467 | $51,445,995 | | Issuance of common stock (registered direct offering) | 31,564 | $1,578 | $8,697,706 | | Issuance of common stock (pre-funded warrant exercises) | 55,392 | $2,770 | $8,308 | | Issuance of common stock (Series B warrant exercises) | 3,260,870 | $163,044 | $16,499,663 | | Issuance of common stock (At-the-Market sales) | 762 | $37 | $351,335 | | Issuance of common stock (settlement of loss contingencies) | 6,065 | $304 | $880,452 | | Effect of reverse stock splits | 42,614 | $2,131 | $(2,131) | | Share based compensation | — | — | $53,276 | | Balance at June 30, 2025 | 3,406,614 | $170,331 | $77,934,604 | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary (Six Months Ended June 30) | Cash Flow Activity | 2025 | 2024 | | :----------------------------------- | :------------- | :------------- | | Net cash used in operating activities | $(3,533,533) | $(3,425,726) | | Net cash used in investing activities | $(8,817) | $(11,461) | | Net cash provided by financing activities | $5,864,389 | $172,899 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $2,322,039 | $(3,264,288) | | Cash, cash equivalents and restricted cash at end of period | $3,473,387 | $2,132,055 | - Net cash provided by financing activities increased significantly to **$5,864,389** in the first six months of 2025, up from **$172,899** in 2024, primarily due to proceeds from common stock issuances and warrant exercises[23](index=23&type=chunk)[24](index=24&type=chunk) - The company experienced a net increase in cash, cash equivalents, and restricted cash of **$2,322,039** in the first six months of 2025, a reversal from a decrease of **$3,264,288** in the same period of 2024[24](index=24&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the condensed consolidated financial statements [NOTE 1 – NATURE OF OPERATIONS](index=13&type=section&id=NOTE%201%20%E2%80%93%20NATURE%20OF%20OPERATIONS) This note describes the company's business, its Nasdaq listing, and the impact of recent reverse stock splits - SUNation Energy, Inc. (SUNE) is a Delaware corporation listed on Nasdaq, focused on powering the energy transition through residential solar, battery storage, and grid services, primarily through its Hawaii Energy Connection (HEC) and SUNation (New York) business units[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - The company executed three reverse stock splits: 1-for-15 (June 2024), 1-for-50 (October 2024), and 1-for-200 (April 2025), retroactively adjusting all prior period financial statements[29](index=29&type=chunk)[33](index=33&type=chunk)[37](index=37&type=chunk)[41](index=41&type=chunk) Impact of Reverse Stock Splits on Common Stock and Additional Paid-in Capital | Metric | June 30, 2024 (As Previously Reported) | June 30, 2024 (Impact of Reverse Stock Split) | June 30, 2024 (As Adjusted) | | :----------------------- | :------------------------------------- | :------------------------------------ | :-------------------------- | | Common Stock shares | 7,243,258 | (7,242,531) | 727 | | Common Stock amount | $362,163 | $(362,127) | $36 | | Additional Paid-in Capital | $21,520,759 | $362,127 | $21,882,886 | | Metric | December 31, 2024 (As Previously Reported) | December 31, 2024 (Impact of Reverse Stock Split) | December 31, 2024 (As Adjusted) | | :----------------------- | :------------------------------------- | :------------------------------------ | :-------------------------- | | Common Stock shares | 1,868,638 | (1,859,295) | 9,343 | | Common Stock amount | $93,432 | $(92,965) | $467 | | Additional Paid-in Capital | $51,353,030 | $92,965 | $51,445,995 | [NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=15&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the key accounting principles, revenue recognition methods, and new accounting standards adopted by the company - The financial statements are prepared in conformity with GAAP, with certain information condensed or omitted for interim reporting, and include the accounts of the Company and its wholly-owned subsidiaries[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) - The Company classifies warrants as equity or liability based on specific terms and authoritative guidance, remeasuring liability-classified warrants to fair value at each balance sheet date with changes recognized in other income (expense)[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - Revenue from residential contracts is recognized at the point-in-time when systems are placed into service, while commercial contracts use the percentage of completion method based on hours incurred[61](index=61&type=chunk)[62](index=62&type=chunk) - New accounting standards issued by FASB, including ASU 2023-06, ASU 2023-09, ASU 2024-03, ASU 2024-04, and ASU 2025-05, are currently being evaluated for their potential impact on the consolidated financial statements[70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk)[73](index=73&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) [NOTE 3 – REVENUE RECOGNITION](index=20&type=section&id=NOTE%203%20%E2%80%93%20REVENUE%20RECOGNITION) This note details the company's revenue breakdown by segment and contract type for residential, commercial, and service activities Revenue by Type (Three Months Ended June 30) | Revenue Type | SUNation 2025 | SUNation 2024 | HEC 2025 | HEC 2024 | | :------------------- | :------------ | :------------ | :------- | :------- | | Residential contracts | $8,016,690 | $8,484,744 | $2,727,495 | $3,665,952 | | Commercial contracts | $1,261,992 | $492,202 | $139,319 | $(13,143) | | Service revenue | $542,167 | $754,701 | $376,591 | $164,964 | | **Total** | **$9,820,849** | **$9,731,647** | **$3,243,405** | **$3,817,773** | Revenue by Type (Six Months Ended June 30) | Revenue Type | SUNation 2025 | SUNation 2024 | HEC 2025 | HEC 2024 | | :------------------- | :------------ | :------------ | :------- | :------- | | Residential contracts | $15,912,812 | $16,616,452 | $5,466,295 | $6,893,831 | | Commercial contracts | $2,537,880 | $1,489,395 | $139,319 | $(13,143) | | Service revenue | $914,711 | $1,378,770 | $729,875 | $403,312 | | **Total** | **$19,365,403** | **$19,484,617** | **$6,335,489** | **$7,284,000** | - SUNation's commercial contract revenue increased significantly by **156%** (three months) and **70%** (six months) YoY, while residential contract revenue decreased by **6%** and **4%** respectively[76](index=76&type=chunk)[77](index=77&type=chunk)[220](index=220&type=chunk)[232](index=232&type=chunk) - HEC's residential contract sales decreased by **26%** (three months) and **21%** (six months) YoY, partly due to the end of the Battery Bonus program in Hawaii, while service revenue increased by **128%** and **81%** respectively[76](index=76&type=chunk)[77](index=77&type=chunk)[223](index=223&type=chunk)[235](index=235&type=chunk) [NOTE 4 – CONTRACTS IN PROGRESS](index=21&type=section&id=NOTE%204%20%E2%80%93%20CONTRACTS%20IN%20PROGRESS) This note presents the financial status of uncompleted contracts, including billings, costs, and estimated earnings Billings in Excess of Costs and Estimated Earnings | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------------- | :-------------- | :------------------ | | Billings to date | $647,062 | $3,055,354 | | Costs incurred on uncompleted contracts | $121,498 | $1,120,213 | | Estimated earnings | $104,090 | $1,490,831 | | Costs plus estimated earnings | $225,588 | $2,611,044 | | Billings in excess of costs plus estimated earnings | $421,474 | $444,310 | Costs and Estimated Earnings in Excess of Billings | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------------- | :-------------- | :------------------ | | Costs incurred on uncompleted contracts | $2,895,293 | $1,233,151 | | Estimated earnings | $2,802,369 | $1,219,234 | | Total costs and estimated earnings | $5,697,662 | $2,452,385 | | Billings to date | $5,093,585 | $1,891,737 | | Costs and estimated earnings in excess of billings | $604,077 | $560,648 | [NOTE 5 – INTANGIBLE ASSETS](index=22&type=section&id=NOTE%205%20%E2%80%93%20INTANGIBLE%20ASSETS) This note provides details on the company's identifiable intangible assets, their net values, and estimated future amortization expenses Identifiable Intangible Assets (Net) | Asset Type | June 30, 2025 (Net) | December 31, 2024 (Net) | | :-------------------- | :------------------ | :-------------------- | | Tradenames & trademarks | $11,102,083 | $12,220,833 | | Developed technology | $0 | $0 | | **Total** | **$11,102,083** | **$12,220,833** | - Amortization expense for identifiable intangible assets decreased to **$559,375** for the three months ended June 30, 2025, from **$709,375** in the prior year, and to **$1,118,750** for the six months ended June 30, 2025, from **$1,418,750** in the prior year, primarily due to the write-down of the technology intangible asset at HEC[81](index=81&type=chunk)[217](index=217&type=chunk)[229](index=229&type=chunk) Estimated Future Amortization Expense | Period | Amount | | :------------- | :------------- | | Q3 - Q4 2025 | $1,118,750 | | 2026 | $2,237,500 | | 2027 | $2,237,500 | | 2028 | $2,237,500 | | 2029 | $2,237,500 | | Thereafter | $1,033,333 | | **Total** | **$11,102,083** | [NOTE 6 – COMMITMENTS AND CONTINGENCIES](index=22&type=section&id=NOTE%206%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) This note discloses the company's various debt agreements, credit lines, and settlements of loss contingencies - The Company entered into a **$1.0 million** Secured Revolving Line of Credit Agreement with MBB Energy, LLC (an affiliate) on April 14, 2025, maturing April 14, 2026, with an **8%** annual interest rate; no amounts were drawn as of June 30, 2025[83](index=83&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk) - The Hercules Term Loan Agreement was fully repaid on March 3, 2025, resulting in a loss on extinguishment of debt of **$455,308**[91](index=91&type=chunk) - The Decathlon Fixed Loan was fully repaid on March 3, 2025, resulting in a gain on extinguishment of debt of **$230,924**[97](index=97&type=chunk) - The SUNation Long-Term Promissory Note was amended on April 10, 2025, extending its maturity to May 1, 2028, and becoming a senior secured instrument with monthly principal and interest payments[101](index=101&type=chunk) - The unearned 2024 SUNation earnout was rescheduled into a Senior Secured Contingent Note Instrument on April 10, 2025, with a balance of **$512,821** at June 30, 2025, and related compensation expense of **$512,821** for the three and six months ended June 30, 2025[103](index=103&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk) - The Conduit Capital Bridge Loan and MBB Energy Bridge Loan were both fully repaid on February 28, 2025, resulting in losses on extinguishment of debt of **$57,716** and **$61,370**, respectively[114](index=114&type=chunk)[123](index=123&type=chunk) - The Company settled **$1,300,000** in accrued loss contingencies related to prior securities issuances during the first six months of 2025 by issuing common stock and cash, with no remaining balance at June 30, 2025[128](index=128&type=chunk) [NOTE 7 – RELATED PARTY TRANSACTIONS](index=29&type=section&id=NOTE%207%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) This note outlines transactions and balances with related parties, including advances to employees and lease agreements Related Party Receivables | Metric | June 30, 2025 | December 31, 2024 | | :---------------------- | :-------------- | :------------------ | | Advances to employees | $23,039 | $23,471 | - The Company leases its Hawaii offices from a company owned by a prior HEC owner and had leased its New York office from a company owned by prior SUNation owners until September 12, 2024[130](index=130&type=chunk) - As of June 30, 2025, outstanding related party debt includes the SUNation Long-Term Note and the Revolving Credit Agreement; the MBB Note was paid in full in Q1 2025[131](index=131&type=chunk) [NOTE 8 – SHARE-BASED COMPENSATION](index=29&type=section&id=NOTE%208%20%E2%80%93%20SHARE-BASED%20COMPENSATION) This note details the company's equity incentive plan, RSU activity, and share-based compensation expense - The 2022 Equity Incentive Plan authorizes up to **67 shares** of common stock for incentive awards; as of June 30, 2025, **4 shares** were issued, **3 RSUs** were outstanding, and **60 shares** were available for future grants[132](index=132&type=chunk) Changes in Restricted Stock Units (RSUs) Outstanding (Six Months Ended June 30, 2025) | Metric | RSUs | Weighted Average Grant Date Fair Value Per Share | | :-------------------------- | :--- | :--------------------------------------------- | | Outstanding – Dec 31, 2024 | 9 | $246,833.33 | | Shares Issued | (4) | $150,221.25 | | Outstanding – Jun 30, 2025 | 5 | $288,900.00 | - Share-based compensation expense was **$22,461** for the three months ended June 30, 2025 (vs. $(11,583) in 2024) and **$53,276** for the six months ended June 30, 2025 (vs. $185,723 in 2024)[136](index=136&type=chunk) [NOTE 9 – EQUITY](index=30&type=section&id=NOTE%209%20%E2%80%93%20EQUITY) This note describes significant changes in the company's equity, including preferred stock reclassifications, warrant activities, and stock offerings - The Series A Preferred Stock was reclassified to mezzanine equity and its waiver resulted in a **$751,125** deemed dividend in Q1 2024[139](index=139&type=chunk)[140](index=140&type=chunk) - PIPE Warrants were reclassified from equity to liability in February 2024 due to insufficient authorized shares, resulting in a **$10.6 million** deemed dividend[142](index=142&type=chunk)[143](index=143&type=chunk) - All **28,041 shares** of Series C Preferred Stock, issued in September 2024, were converted into **6,229 shares** of common stock during 2024 and are no longer outstanding[145](index=145&type=chunk) - The February 2025 Offering raised **$20.0 million** in gross proceeds across two tranches, involving common stock, pre-funded warrants, Series A warrants, and Series B warrants[149](index=149&type=chunk)[154](index=154&type=chunk) - The contingent forward contract related to the second tranche of the February 2025 Offering was initially recorded as a **$5,515,525** liability and derecognized on April 7, 2025, resulting in a remeasurement gain of **$899,080** for the six months ended June 30, 2025[151](index=151&type=chunk)[152](index=152&type=chunk)[155](index=155&type=chunk) - Series B warrants were fully exercised in Q2 2025, resulting in the issuance of **3,260,870** common shares and a remeasurement loss of **$8,025,504**. Series A warrants were terminated on June 26, 2025, for a payment of **$267,391**, resulting in a gain of **$494,460**[157](index=157&type=chunk)[158](index=158&type=chunk)[159](index=159&type=chunk) [NOTE 10 – INCOME TAXES](index=34&type=section&id=NOTE%2010%20%E2%80%93%20INCOME%20TAXES) This note explains the company's effective income tax rate and the potential impact of recent tax law changes Effective Income Tax Rate | Period | 2025 | 2024 | | :-------------------------------- | :--- | :--- | | Three Months Ended June 30 | (0.1%) | 0.1% | | Six Months Ended June 30 | (0.2%) | 0.0% | - The effective tax rate differs from the federal rate of **21%** due to state income taxes and changes in valuation allowances related to deferred tax assets[162](index=162&type=chunk) - The 'One Big Beautiful Bill Act,' signed into law on July 4, 2025, includes tax law changes (e.g., restoration of immediate R&D expensing, 100% bonus depreciation) that the Company is currently evaluating for impact on its financial statements[163](index=163&type=chunk) [NOTE 11 – SEGMENT INFORMATION](index=34&type=section&id=NOTE%2011%20%E2%80%93%20SEGMENT%20INFORMATION) This note provides financial information for the company's two reportable segments: SUNation and Hawaii Energy Connection - The Company operates two reportable segments: SUNation (New York and Florida) and Hawaii Energy Connection (HEC) (Hawaii), providing solar power, battery storage, and related services[164](index=164&type=chunk) - Management determined in 2024 that the two operating segments no longer met aggregation criteria due to changes in economic forecasts and integration plans, leading to distinct reportable segments[165](index=165&type=chunk) Segment Sales (Three Months Ended June 30) | Segment | 2025 Sales | 2024 Sales | | :-------- | :----------- | :----------- | | SUNation | $9,820,849 | $9,731,647 | | HEC | $3,243,405 | $3,817,773 | | **Total** | **$13,064,254** | **$13,549,420** | Segment Sales (Six Months Ended June 30) | Segment | 2025 Sales | 2024 Sales | | :-------- | :----------- | :----------- | | SUNation | $19,365,403 | $19,484,617 | | HEC | $6,335,489 | $7,284,000 | | **Total** | **$25,700,892** | **$26,768,617** | [NOTE 12 – FAIR VALUE MEASUREMENTS](index=37&type=section&id=NOTE%2012%20%E2%80%93%20FAIR%20VALUE%20MEASUREMENTS) This note details the company's fair value measurements for financial instruments, including cash equivalents and contingent value rights - The Company uses a three-level valuation hierarchy for fair value measurements, with Level 3 inputs requiring significant management judgment[171](index=171&type=chunk)[172](index=172&type=chunk)[173](index=173&type=chunk) Fair Value Measurements (June 30, 2025) | Financial Instrument | Level 1 | Level 2 | Level 3 | Total Fair Value | | :--------------------- | :-------- | :-------- | :-------- | :--------------- | | Cash equivalents | $1,535,022 | — | — | $1,535,022 | | Contingent value rights | — | — | $(286,630) | $(286,630) | | **Total** | **$1,535,022** | **—** | **$(286,630)** | **$1,248,392** | Fair Value Measurements (December 31, 2024) | Financial Instrument | Level 1 | Level 2 | Level 3 | Total Fair Value | | :--------------------- | :-------- | :-------- | :-------- | :--------------- | | Cash equivalents | $368,138 | — | — | $368,138 | | Contingent value rights | — | — | $(312,080) | $(312,080) | | Embedded derivative liability | — | — | $(82,281) | $(82,281) | | Earnout consideration | — | $(2,500,000) | — | $(2,500,000) | | **Total** | **$368,138** | **$(2,500,000)** | **$(394,361)** | **$(2,526,223)** | - The Company recorded a remeasurement loss of **$7,531,044** for the three and six months ended June 30, 2025, on warrant liability, which was settled as of June 30, 2025[187](index=187&type=chunk) [NOTE 13 – GOING CONCERN](index=40&type=section&id=NOTE%2013%20%E2%80%93%20GOING%20CONCERN) This note addresses the substantial doubt about the company's ability to continue as a going concern and management's plans to raise capital - Substantial doubt exists about the Company's ability to continue as a going concern due to its current financial position, including restricted cash and reliance on future cash flows from operating segments to cover corporate overhead[190](index=190&type=chunk) - Management plans to raise additional capital through public or private equity offerings, debt financings, and/or strategic alliances, but cannot provide assurances of success[191](index=191&type=chunk) [NOTE 14 – SUBSEQUENT EVENTS](index=40&type=section&id=NOTE%2014%20%E2%80%93%20SUBSEQUENT%20EVENTS) This note confirms the evaluation of events occurring after the balance sheet date, with no material disclosures required - The Company has evaluated subsequent events through the filing date and does not believe there are any material subsequent events requiring further disclosure beyond those already provided in the financial statement footnotes[192](index=192&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, including an overview of the business, the impact of reverse stock splits, detailed analysis of operating results by segment and period, liquidity and capital resources, and critical accounting estimates. It highlights a net loss increase, significant financing activities, and ongoing concerns about the Company's ability to continue as a going concern [Forward-Looking Statements](index=41&type=section&id=Forward-Looking%20Statements) This section highlights the inherent risks and uncertainties associated with the company's forward-looking statements - The report contains forward-looking statements subject to significant risks and uncertainties, including stock price volatility, dilution from additional stock issuance, anti-takeover provisions, dependence on solar installation agreements, and the need for additional capital[194](index=194&type=chunk) - Key risks include potential delisting from Nasdaq, claims for monetary damages, reliance on limited suppliers, impacts of tariffs and trade restrictions, changes in solar energy regulations (e.g., One Big Beautiful Bill Act), and the ability to manage growth and acquisitions[194](index=194&type=chunk) [Overview](index=43&type=section&id=Overview) This section provides a general description of SUNation Energy's business, strategy, and operating segments - SUNation Energy, Inc. (SUNE) is a Delaware corporation listed on Nasdaq, focused on residential solar, battery storage, and grid services, with a strategy to acquire, integrate, and grow local and regional energy services companies nationwide[197](index=197&type=chunk)[198](index=198&type=chunk) - Current business units, Hawaii Energy Connection (HEC) and SUNation (New York), specialize in designing, installing, and maintaining solar energy systems for residential, commercial, and municipal sectors, also offering energy storage and residential roofing solutions[199](index=199&type=chunk) [Reverse Stock Splits](index=43&type=section&id=Reverse%20Stock%20Splits) This section explains the company's recent reverse stock splits and their retroactive impact on financial reporting - The Company implemented three reverse stock splits: 1-for-15 (June 12, 2024), 1-for-50 (October 17, 2024), and 1-for-200 (April 21, 2025), which retroactively adjusted all financial periods presented[203](index=203&type=chunk)[207](index=207&type=chunk)[211](index=211&type=chunk)[213](index=213&type=chunk) - The April 2025 reverse stock split reduced outstanding common stock from **672,799,910** to **3,406,614 shares**, with fractional shares rounded up[212](index=212&type=chunk) [Results of Operations](index=45&type=section&id=Results%20of%20Operations) This section analyzes the company's consolidated financial performance for the three and six months ended June 30, 2025 and 2024 [Comparison of the Three Months Ended June 30, 2025 and 2024](index=45&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030,%202025%20and%202024) This section compares the company's sales, gross profit, operating loss, and net loss for the three-month periods Consolidated Results (Three Months Ended June 30) | Metric | 2025 Amount | 2024 Amount | Change ($) | Change (%) | | :------------------------------------------------- | :------------ | :------------ | :--------- | :--------- | | Sales | $13,064,254 | $13,549,420 | $(485,166) | -3.6% | | Gross profit | $4,839,517 | $4,792,354 | $47,163 | 1.0% | | Operating loss | $(2,163,587) | $(2,025,944) | $(137,643) | 6.8% | | Other expense, net | $(7,429,592) | $(4,914,704) | $(2,514,888) | 51.2% | | Net loss | $(9,607,415) | $(6,934,015) | $(2,673,400) | 38.6% | - Consolidated sales decreased by **3.6%** YoY, driven by a **12%** decline in residential contract revenue, partially offset by a **193%** increase in commercial revenue[215](index=215&type=chunk) - Consolidated gross margin improved to **37%** in Q2 2025 from **35%** in Q2 2024, primarily due to improved residential margins[216](index=216&type=chunk) - Consolidated other expense increased by **$2,514,888**, mainly due to a **$4,263,473** increase in fair value remeasurement loss on warrant liability and **$559,939** in financing fees, partially offset by decreases in embedded derivative liability remeasurement loss and interest expense[218](index=218&type=chunk) [Comparison of the Six Months Ended June 30, 2025 and 2024](index=47&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) This section compares the company's sales, gross profit, operating loss, and net loss for the six-month periods Consolidated Results (Six Months Ended June 30) | Metric | 2025 Amount | 2024 Amount | Change ($) | Change (%) | | :------------------------------------------------- | :------------ | :------------ | :--------- | :--------- | | Sales | $25,700,892 | $26,768,617 | $(1,067,725) | -4.0% | | Gross profit | $9,270,842 | $9,597,802 | $(326,960) | -3.4% | | Operating loss | $(4,330,935) | $(4,208,898) | $(122,037) | 2.9% | | Other expense, net | $(8,744,061) | $(1,522,937) | $(7,221,124) | 474.2% | | Net loss | $(13,103,847) | $(5,731,364) | $(7,372,483) | 128.6% | - Consolidated sales decreased by **4.0%** YoY, primarily due to declines in residential contract and service revenue, partially offset by increased commercial contract revenue[227](index=227&type=chunk) - Consolidated other expense increased significantly by **$7,221,124**, mainly driven by a **$7,992,066** increase in fair value remeasurement on warrant liability, a **$343,471** loss on debt extinguishment, and **$1,136,532** in financing fees[230](index=230&type=chunk) - Net loss increased by **128.6%** to **$13,103,847** for the first six months of 2025, compared to **$5,731,364** in the prior year[231](index=231&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, working capital, and financing activities, noting ongoing going concern doubts Liquidity Metrics | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------------- | :-------------- | :------------------ | | Cash, restricted cash and cash equivalents | $3,473,387 | $1,151,348 (beginning of period) | | Working capital deficit | $(1,850,380) | $(16,051,658) | | Net cash used in operating activities (six months) | $(3,533,533) | $(3,425,726) | | Net cash provided by financing activities (six months) | $5,864,389 | $172,899 | - The Company's working capital deficit significantly improved from **$(16,051,658)** at December 31, 2024, to **$(1,850,380)** at June 30, 2025[240](index=240&type=chunk) - Net cash provided by financing activities increased substantially in the first six months of 2025 to **$5,864,389**, driven by **$17,871,964** in net proceeds from common stock issuances and **$351,372** from at-the-market offerings, partially offset by debt and contingent consideration payments[243](index=243&type=chunk) - Despite recent capital raises and debt repayments, substantial doubt remains about the Company's ability to continue as a going concern, as future cash flows rely on operating segments covering corporate overhead costs[245](index=245&type=chunk) [Contingent Value Rights and Impact on Cash](index=51&type=section&id=Contingent%20Value%20Rights%20and%20Impact%20on%20Cash) This section explains the contingent value rights liability and its restriction on the company's cash usage - The CVR liability was estimated at **$286,630** as of June 30, 2025, representing the fair value of legacy CSI assets to be distributed to CVR holders[248](index=248&type=chunk) - Funds restricted under the CVR agreement (**$286,630**) cannot be used for the SUNation Energy business's working capital needs[239](index=239&type=chunk)[248](index=248&type=chunk) [Critical Accounting Estimates](index=51&type=section&id=Critical%20Accounting%20Estimates) This section confirms no changes to the company's critical accounting estimates from its prior annual report - There have been no changes to the Company's critical accounting estimates as described in its Annual Report on Form 10-K for the year ended December 31, 2024[249](index=249&type=chunk) [Recently Issued Accounting Pronouncements](index=51&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) This section refers to Note 2 for details on new accounting standards and their potential financial statement impact - Information on recently issued accounting standards and their estimated effect on the Company's condensed consolidated financial statements is described in Note 2, Summary of Significant Accounting Policies[250](index=250&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=51&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section states that there are no applicable quantitative and qualitative disclosures about market risk for the Company - The Company states that this item is not applicable[251](index=251&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of the Company's disclosure controls and procedures, identifying material weaknesses in internal control over financial reporting due to limited accounting and finance resources. It outlines a remediation plan, including implementing a new ERP system, and acknowledges the inherent limitations of control systems [Evaluation of Disclosure Controls and Procedures](index=51&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section details management's conclusion on the effectiveness of the company's disclosure controls and procedures - Management concluded that the Company's disclosure controls and procedures were not effective as of June 30, 2025, due to material weaknesses in internal control over financial reporting[254](index=254&type=chunk) [Material Weakness in Internal Control over Financial Reporting](index=52&type=section&id=Material%20Weakness%20in%20Internal%20Control%20over%20Financial%20Reporting) This section identifies material weaknesses in the company's internal control over financial reporting due to resource limitations - Material weaknesses were identified due to limited accounting and finance resources, leading to inappropriate preparation, review, and maintenance of critical documentation and information for internal controls[256](index=256&type=chunk) - These weaknesses could result in a reasonable possibility of material misstatement in annual or interim financial statements not being prevented or detected timely[256](index=256&type=chunk) [Remediation Plan](index=52&type=section&id=Remediation%20Plan) This section outlines the company's strategy to address and remediate identified material weaknesses in internal controls - The Company is formalizing a remediation plan to address limited resources, including implementing a new Enterprise Resource Planning (ERP) system to enhance control environment, segregation of duties, user permissions, and automated processes[257](index=257&type=chunk) - Remediation efforts are ongoing and require validation and testing; additional analyses and procedures will be performed until weaknesses are fully remediated[257](index=257&type=chunk) [Inherent Limitations on Control Systems](index=52&type=section&id=Inherent%20Limitations%20on%20Control%20Systems) This section acknowledges the intrinsic limitations of any control system, preventing absolute assurance against all potential issues - Control systems have inherent limitations, meaning absolute assurance against all control issues, fraud, or misstatements cannot be provided due to faulty judgments, simple errors, circumvention by individuals or collusion, or management override[258](index=258&type=chunk) [Changes in Internal Controls over Financial Reporting](index=53&type=section&id=Changes%20in%20Internal%20Controls%20over%20Financial%20Reporting) This section reports on any changes in internal control over financial reporting during the period - No changes in internal control over financial reporting occurred during the three months ended June 30, 2025, that materially affected or are reasonably likely to materially affect internal control over financial reporting[259](index=259&type=chunk) - As reported in the Annual Report on Form 10-K for 2024, the Company's internal control over financial reporting was concluded to be ineffective[259](index=259&type=chunk) [Part II. Other Information](index=54&type=section&id=Part%20II.%20Other%20Information) This section covers legal proceedings, risk factors, equity sales, defaults, mine safety, and other miscellaneous disclosures [Item 1. Legal Proceedings](index=54&type=section&id=Item%201.%20Legal%20Proceedings) This section states that there are no updates to the legal proceedings previously reported in the Company's annual report on Form 10-K - There are no updates to the legal proceedings previously reported in the Company's annual report on Form 10-K filed on April 15, 2025[261](index=261&type=chunk) [Item 1A. Risk Factors](index=54&type=section&id=Item%201A.%20Risk%20Factors) This section updates the risk factors, highlighting new or changed risks related to regulatory changes in the solar energy sector, potential Nasdaq delisting, and the need for substantial additional financing. It emphasizes the impact of the 'One Big Beautiful Bill Act' on tax credits and the ongoing challenges in securing capital for operations and growth - The 'One Big Beautiful Bill Act,' signed into law on July 4, 2025, accelerates phase-outs and terminations of various tax credits from the Inflation Reduction Act, potentially reducing demand for solar energy systems and harming the business[264](index=264&type=chunk) - The Company's shares are subject to potential delisting from the Nasdaq Capital Market if listing requirements are not maintained, although the Company was found in compliance with the Minimum Bid Price and Public Interest Concern rules as of June 10, 2025[265](index=265&type=chunk)[269](index=269&type=chunk) - The Company requires substantial additional financing for working capital and growth, with the 'One Big Beautiful Bill Act' adding complexity to operating and finance costs and impacting the availability of tax credits for residential customers[272](index=272&type=chunk) - Inability to secure financing on acceptable terms could materially adversely impact the business, liquidity, financial condition, and growth prospects, potentially leading to delays in installations or business expansion[274](index=274&type=chunk)[276](index=276&type=chunk) - Litigation, including claims for breach of contract or contractual defaults, may be costly and time-consuming, diverting management's attention and potentially resulting in significant monetary damages or injunctive relief[277](index=277&type=chunk)[278](index=278&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=57&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section states that there are no applicable disclosures regarding unregistered sales of equity securities and use of proceeds - This item is not applicable[281](index=281&type=chunk) [Item 3. Defaults Upon Senior Securities](index=57&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section states that there are no applicable disclosures regarding defaults upon senior securities - This item is not applicable[281](index=281&type=chunk) [Item 4. Mine Safety Disclosures](index=57&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that there are no applicable disclosures regarding mine safety - This item is not applicable[281](index=281&type=chunk) [Item 5. Other Information](index=57&type=section&id=Item%205.%20Other%20Information) This section confirms that no directors or officers adopted, modified, or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2025 - No directors or officers adopted, modified, or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[281](index=281&type=chunk) [Item 6. Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications (31.1, 31.2, 32) and Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104) - The exhibits include certifications (31.1, 31.2, 32) and various Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[282](index=282&type=chunk) [SIGNATURES CERTIFICATIONS](index=57&type=section&id=SIGNATURES%20CERTIFICATIONS) This section contains the required signatures and certifications for the financial report

Financial Performance - Consolidated revenue for Q1 2025 declined by 4% to $12.6 million from $13.2 million in Q1 2024, with Commercial revenue rising 28% while Residential revenue fell by 3% due to seasonality[8] - Sales for the three months ended March 31, 2025, were $12,636,638, a decrease of 4.4% compared to $13,219,197 in the same period of 2024[19] - Gross profit decreased to $4,431,325, down 7.8% from $4,805,448 year-over-year[19] - Operating loss for the quarter was $2,167,348, slightly improved from a loss of $2,182,954 in the prior year[19] - Net loss attributable to common shareholders was $3,496,432, compared to a loss of $10,119,988 in the same quarter of 2024, indicating a significant reduction in losses[19] - Basic and diluted net loss per share was $106.71, reflecting the reverse stock split adjustments[19] - Adjusted EBITDA for the quarter was $(1,464,215), an improvement from $(1,509,570) in the prior year[25] Cost Management - SG&A expenses decreased by 9% to $6.0 million from $6.6 million, reflecting cost optimization measures implemented in 2024[8] - Total operating expenses decreased to $6,598,673, down from $6,988,402 year-over-year, showing a reduction in costs[19] - Interest expense declined by 25% to $0.6 million from $0.8 million, demonstrating management's commitment to debt repayment[8] - Interest expense decreased to $571,240 from $764,870, indicating improved financing conditions[25] Debt and Liquidity - Total debt decreased by 51% to $9.2 million from $19.1 million at December 31, 2024, significantly improving the company's financial position[8] - Cash and cash equivalents increased to $1.4 million from $0.8 million at December 31, 2024, indicating enhanced liquidity[8] Future Outlook - The company expects total sales for 2025 to be between $65 million and $70 million, representing a projected increase of 14% to 23% from $56.9 million in 2024[12] - Adjusted EBITDA is projected to be between $0.5 million and $0.7 million, a significant improvement from an Adjusted EBITDA loss in 2024[12] - Future outlook includes continued focus on cost management and potential market expansion strategies[21] Business Development - SUNation's Commercial backlog rose more than 30% compared to the same period last year, driven by various projects in development with institutional partners[3] - The company plans to expand its Service and Maintenance business in the New York metro region, targeting homeowners with orphaned solar systems[4] - SUNation has secured $20 million in aggregate gross proceeds through a securities purchase agreement with institutional investors, enhancing its capital structure[8]

Financial Performance - Sales for the three months ended March 31, 2025, were $12.64 million, a decrease of 4.4% compared to $13.22 million for the same period in 2024[15]. - Gross profit for Q1 2025 was $4.43 million, down from $4.81 million in Q1 2024, reflecting a decrease of 7.2%[15]. - Operating loss for the three months ended March 31, 2025, was $2.17 million, slightly improved from a loss of $2.18 million in Q1 2024[15]. - Net loss attributable to common shareholders for Q1 2025 was $3.50 million, compared to a net loss of $10.12 million in Q1 2024, indicating a significant reduction in losses[15]. - Basic net loss per share for Q1 2025 was $106.71, compared to $38,414.84 for Q1 2024, reflecting the impact of reverse stock splits[15]. - Total revenues for SUNation were $9,544,554 in Q1 2025, down from $9,752,970 in Q1 2024, reflecting a decrease of 2.1%[74]. - For the three months ended March 31, 2025, SUNation reported residential contract revenues of $7,896,122, a decrease of 2.9% from $8,131,708 in the same period of 2024[74]. - Commercial contract revenues increased to $1,275,888 in Q1 2025 from $997,193 in Q1 2024, representing a growth of 28%[74]. - Net loss before income taxes for Q1 2025 was $(3,481,817), compared to a net income of $1,208,813 in Q1 2024, highlighting a significant decline in profitability[152]. - Selling, general and administrative expenses for Q1 2025 totaled $6,039,298, compared to $6,629,027 in Q1 2024, indicating a reduction in overhead costs[151]. Assets and Liabilities - Total assets decreased to $44.43 million as of March 31, 2025, from $45.71 million as of December 31, 2024, representing a decline of approximately 2.8%[10]. - Total current liabilities decreased to $20.27 million as of March 31, 2025, from $27.16 million as of December 31, 2024, a reduction of approximately 25.5%[10]. - The company reported cash and cash equivalents of $1.45 million as of March 31, 2025, up from $839,268 as of December 31, 2024, an increase of approximately 72.5%[10]. - Inventories decreased to $2.51 million as of March 31, 2025, from $2.71 million as of December 31, 2024, a decline of approximately 7.2%[10]. - The balance of accumulated deficit as of March 31, 2025, was $(46,395,478), an increase from $(25,850,588) as of March 31, 2024[18]. Capital and Financing Activities - The company raised $9,473,398 from the issuance of common stock and pre-funded warrants under a registered direct offering during the three months ended March 31, 2024[22]. - The company raised approximately $20.0 million in aggregate gross proceeds from a securities offering, with $5 million from the second tranche closing on April 7, 2025[168]. - The company issued 9,825 shares of common stock under a registered direct offering, netting $8,481,892[17]. - The At the Market Offering Agreement allows the Company to sell up to $10,000,000 in common stock, with 762 shares sold for gross proceeds of $362,269 during the three months ended March 31, 2025[136]. - The Company executed a reverse stock split at a 1-for-50 ratio on October 1, 2024, reducing outstanding shares from 67,260,696 to 1,344,841[33]. - A subsequent reverse stock split at a 1-for-200 ratio was approved on April 3, 2025, reducing outstanding shares from 672,799,910 to 3,406,614[39]. - The Company increased its authorized shares to 1,000,000,000 as part of the April 2025 reverse stock split approval[36]. Debt and Interest Obligations - The loan payable to Hercules Capital, Inc. was originally $7,500,000, with an interest rate of 10%, and was due on December 31, 2024, after amendments to the Term Loan Agreement[80][81]. - The Term Loan Agreement was amended on May 31, 2023, resulting in a remaining balance of $3,375,742, with a new maturity date of June 2, 2027, and an interest rate of 10%[82]. - The Company recorded a loss on extinguishment of debt of $455,308 upon full repayment of the Term Loan on March 3, 2025[85]. - The Company recorded interest and accretion expense of $33,312 for the three months ended March 31, 2025, compared to $0 for the same period in 2024[105]. - Interest paid increased to $1,077,033 from $416,504 in the previous year[22]. Strategic Initiatives - The company’s strategy focuses on acquiring and integrating leading local and regional solar, storage, and energy services companies nationwide[26]. - The company aims to expand its operations by acquiring and integrating leading local and regional solar, storage, and energy services companies nationwide[26]. - The company plans to raise capital through public or private equity offerings, debt financings, and/or strategic alliances[166]. Accounting and Compliance - The Company is currently evaluating the impact of new accounting standards issued by the FASB, including ASU 2023-06 and ASU 2023-09, which may affect its consolidated financial statements[69][71]. - The effective income tax rate from continuing operations was (0.4%) for the three months ended March 31, 2025, differing from the federal tax rate of 21% due to state income taxes[145]. - The Company’s segment structure now includes distinct reportable segments for SUNation and Hawaii Energy Connection (HEC) due to changes in economic forecasts[148]. Market and Operational Challenges - The company received a Nasdaq delisting notice on April 11, 2025, due to not maintaining a minimum closing bid price of $1.00 per share[172]. - The company has substantial doubt about its ability to continue as a going concern, requiring additional capital resources[165].

Company Operations and Strategy - SUNation Energy completed a merger with Pineapple Energy LLC on March 28, 2022, and subsequently changed its name from Communications Systems, Inc. to SUNation Energy, Inc.[224] - The company divested its legacy operations by selling substantially all assets of JDL Technologies, Inc. and Ecessa Corporation on June 30, 2023, reporting these as discontinued operations[228]. - The company’s strategy focuses on acquiring and integrating local and regional solar, storage, and energy services companies nationwide[226]. - SUNation Energy offers tailored solar solutions, energy storage systems, and community solar services to enhance accessibility to renewable energy[227]. Financial Performance - Consolidated sales decreased 28.6% to $56,861,753 in 2024 from $79,632,709 in 2023, attributed to an overall industry contraction in the residential solar market[260]. - Consolidated gross profit decreased 26.2% to $20,426,244 in 2024, with a gross margin increase to 35.9% compared to 34.8% in 2023[262]. - Consolidated operating expenses decreased 6.9% to $32,743,647 in 2024, with selling, general and administrative expenses also decreasing by 6.9% to $27,054,166[263]. - Net loss from continuing operations attributable to shareholders in 2024 was $27,436,926, or ($50.58) per diluted share, compared to a net loss of $6,939,892, or ($521.89) per diluted share in 2023[265]. - SUNation sales decreased 24% to $39,733,362 in 2024, with residential contract sales down 22% due to a reduction in installed kilowatts[266]. - HEC sales decreased 37% to $17,128,391 in 2024, with residential contract sales down 36% due to a significant decrease in battery capacity installed[271]. - Consolidated other income decreased to an expense of $(4,385,777) in 2024, down from income of $646,149 in 2023[264]. Asset and Cash Flow Management - As of December 31, 2024, the Company had approximately $1,151,348 in cash, restricted cash, and cash equivalents, a decrease from $5,396,343 at December 31, 2023[274]. - The Company reported working capital of $(16,051,658) at December 31, 2024, compared to $(6,594,834) at the end of 2023, indicating a worsening liquidity position[276]. - Cash flow used in operating activities was approximately $6,302,686 in 2024, significantly higher than $667,177 used in 2023, primarily due to decreased operating profit and increased interest expense[277]. - Net cash provided by financing activities was $2,084,358 in 2024, compared to $2,760,236 used in 2023, driven by proceeds from stock issuances and borrowings[278]. - The Company raised $20.0 million in securities through a purchase agreement with institutional investors, but this was insufficient to cover all current and future obligations[281]. - Cash used in investing activities was $26,667 in 2024, a significant decrease from $3,567,278 provided in 2023, reflecting a shift in investment strategy[277]. - The Company’s current assets were approximately $11,110,385 against current liabilities of $27,162,043 at the end of 2024, highlighting a significant liquidity challenge[276]. Goodwill and Impairment - The company recorded a goodwill impairment loss of $3.1 million in the HEC segment, reducing the HEC goodwill balance to $6.7 million[255]. - The company performed an interim quantitative analysis and recorded an impairment loss of $3.1 million as of December 31, 2024, due to a material decline in stock price and forecasted revenues[255]. - The company’s goodwill impairment testing is conducted annually, with significant changes in business climate or performance potentially triggering more frequent assessments[250]. Market and Economic Conditions - As of January 3, 2025, the total market capitalization of bitcoin was approximately $1.95 trillion, with prices fluctuating between $38,000 and $108,000 per bitcoin in the preceding 12 months[232]. - The company approved a corporate treasury strategy in January 2025 to include bitcoin as a treasury reserve asset, potentially allocating a minority portion of excess cash for BTC purchases[230]. - The company believes bitcoin serves as a reliable store of value and a potential inflation hedge amid global instability[233]. Share Structure and Corporate Governance - Following the June 2024 reverse stock split, the number of shares outstanding was reduced from 108,546,773 to 7,235,731, and the total number of authorized shares was reduced to 7,500,000[237]. - The October 2024 reverse stock split reduced the number of shares outstanding from 67,260,696 to 1,344,841, with authorized shares later increased to 25,000,000[241]. - The Long-Term Promissory Note was amended to extend the maturity date to May 1, 2028, with monthly principal and interest payments commencing June 1, 2025[279]. Going Concern and Future Outlook - The Company has substantial doubt about its ability to continue as a going concern due to forecasted cash flow uncertainties and reliance on operating segments to cover corporate overhead costs[280].

Financial Performance - Residential contract sales decreased by $4,699,412, or 31%, due to a 22% reduction in residential kilowatts installed and a decrease in average price per system installed [208]. - Consolidated sales decreased by $18,703,410, or 31.1%, to $41,487,003 in the first nine months of 2024 from $60,190,413 in the first nine months of 2023 [209]. - Consolidated gross profit decreased to $14,833,527 in the first nine months of 2024 compared to $22,175,708 in the same period of 2023, with gross margin slightly decreasing to 36% [210]. - Consolidated operating loss from continuing operations in the first nine months of 2024 was $5,815,635, compared to a loss of $5,129,195 in the same period of 2023 [210]. - Net loss from continuing operations attributable to shareholders in the first nine months of 2024 was $20,617,094, or $(128.25) per diluted share, compared to a net loss of $5,262,534, or $(395.75) per diluted share, in the first nine months of 2023 [210]. - Consolidated selling, general and administrative expenses decreased by $3,123,771, or 14%, to $19,321,037 in the first nine months of 2024 from $22,444,808 in the same period of 2023 [210]. Corporate Actions - The company divested its legacy operations and operating assets through the sale of substantially all assets of JDL Technologies, Inc. and Ecessa Corporation on June 30, 2023 [205]. - The company has made several amendments to its Articles of Incorporation, with the latest being effective as of October 17, 2024 [3.4]. - A Certificate of Designation for Series C Convertible Preferred Stock was filed on September 9, 2024 [3.9]. - The company canceled the Certificate of Designation for Series B Preferred Stock effective August 14, 2024 [3.8]. - The restated bylaws of the company were amended and became effective on April 13, 2022 [3.6]. - The company filed a Certificate of Correction to the Certificate of Designation on September 23, 2024 [3.10]. - The company has undergone a name change from Communications Systems, Inc. to Pineapple Energy Inc. [3.5]. Compliance and Financial Needs - The company is in the process of formalizing a remediation plan to address material weaknesses in internal control over financial reporting [214]. - The company has raised over $2 million from an ATM Offering Agreement to sell shares up to $10,000,000, but additional funding may not be available on acceptable terms [212]. - The company needs to obtain substantial additional financing arrangements to provide working capital and growth capital, with potential adverse impacts if financing is not available [220]. - The company’s interim Chief Financial Officer, Andrew Childs, signed the report on November 14, 2024 [226]. - The company has filed multiple reports on Form 8-K and Form 10-Q throughout 2024, indicating ongoing compliance with SEC regulations [224]. - The company’s financial documents include various amendments and designations related to its preferred stock offerings [3.1]. - The company’s Articles of Amendment have been updated multiple times in 2024, reflecting changes in corporate governance [3.2].

Financial Performance - Consolidated sales decreased by $6,286,871, or 31.7%, to $13,549,420 in Q2 2024 from $19,836,291 in Q2 2023[134] - Residential contract sales decreased by $2,691,079, or 18%, due to a 7% reduction in residential kilowatts installed and a decrease in average price per system[134] - Commercial contract sales decreased by $3,268,061, or 87%, due to delays in the start of commercial pipeline projects[134] - Consolidated gross profit decreased to $4,792,354 in Q2 2024 from $7,136,934 in Q2 2023, with a gross margin of 35%[135] - Consolidated operating expenses decreased to $6,818,298 in Q2 2024 from $8,552,254 in Q2 2023, with selling, general and administrative expenses down by 18%[136] - Consolidated operating loss from continuing operations was $2,025,944 in Q2 2024 compared to $1,415,320 in Q2 2023[137] - Net loss from continuing operations attributable to shareholders was $6,934,015, or $(1.11) per diluted share, in Q2 2024[137] - Consolidated sales decreased by $15,133,099, or 36.1%, to $26,768,617 in the first six months of 2024 from $41,901,716 in the same period of 2023[138] - Residential contract sales decreased by $9,434,879, or 28%, due to a 19% reduction in residential kilowatts installed[138] - Consolidated gross profit decreased to $9,597,802 in the first six months of 2024 compared to $15,143,250 in the same period of 2023, with a gross margin remaining flat at 36%[139] - Consolidated operating expenses decreased to $13,806,700 in the first six months of 2024 from $18,708,095 in the same period of 2023, a reduction of $4,901,395, or 26.2%[140] - Consolidated operating loss from continuing operations was $4,208,898 in the first six months of 2024, compared to a loss of $3,564,845 in the same period of 2023[141] - Net loss from continuing operations attributable to shareholders was $17,054,003, or $(3.83) per diluted share, in the first six months of 2024, compared to a net loss of $2,933,481, or $(4.43) per diluted share, in the same period of 2023[141] Working Capital and Cash Flow - As of June 30, 2024, the company had a working capital deficit of $(11,600,420), compared to $(6,594,834) at December 31, 2023[144] - Cash used in operating activities was $3,425,726 in the first six months of 2024, compared to $1,660,982 in the same period of 2023[144] - The company requires additional funding and seeks to raise capital through public or private equity offerings, debt financings, and/or strategic alliances[149] Internal Controls and Compliance - The Company concluded that its internal control over financial reporting was not effective as of December 31, 2023, due to material weaknesses identified[156] - Material weaknesses were attributed to limited accounting and finance resources, leading to inappropriate preparation and maintenance of critical documentation[157] - A remediation plan is being formalized, which includes implementing a new Enterprise Resource Planning (ERP) system to enhance internal controls[158] - The design and implementation of the remediation efforts are ongoing and will require validation and testing over a sustained period[158] - There were no changes in internal control over financial reporting during the three months ended June 30, 2024, that materially affected the controls[160] - The Company plans to continue performing additional analyses to ensure consolidated financial statements are prepared in accordance with U.S. GAAP until weaknesses are remediated[158] - Inherent limitations in control systems mean that not all control issues or instances of fraud can be detected[159] Nasdaq Compliance - The Company received a notice from Nasdaq on October 27, 2023, regarding non-compliance with the minimum closing bid price requirement, as the stock price was below $1.00 for 31 consecutive business days[162] - The Company has until April 24, 2024, to regain compliance with the Nasdaq Minimum Bid Rule[162] - The failure to maintain compliance with Nasdaq's listing requirements could negatively impact the market price of the common stock and the Company's liquidity[161] Strategic Focus - The company is focused on acquiring, integrating, and growing leading local and regional solar, storage, and energy services companies nationwide[129] - The company sold substantially all of the remaining assets of its JDL Technologies and Ecessa businesses on June 30, 2023, reporting these as discontinued operations[131] - A reverse stock split at a ratio of 1-for-15 was approved, reducing the number of shares outstanding from 108,546,773 to 7,235,731[133] CVR Liability - The CVR liability as of June 30, 2024, was estimated at $1,198,212, representing the estimated fair value of legacy CSI assets to be distributed to CVR holders[150]

Group 1 - Pineapple Energy Inc. has successfully completed its first round of capital fundraising, focusing on sustainable solar energy and backup power for households and small businesses [1] - The company aims to grow local and regional solar, storage, and energy services companies nationwide, emphasizing grassroots growth of solar electricity paired with battery storage [2] - Pineapple's portfolio includes brands such as SUNation Energy, Hawaii Energy Connection, and E-Gear, offering end-to-end products in solar, battery storage, and grid services [2] Group 2 - Conduit Capital's collaboration with MBB Energy can provide Pineapple over $1 million, with the first tranche of the new loan funded on July 23, 2024 [4] - The funding is intended to address Pineapple's short-term needs and is part of a strategy to reimagine, restructure, recapitalize, and rebuild shareholder equity [7] - Conduit Capital aims to activate capital at scale to prove the financial viability of impact investment strategies, contributing to a sustainable future [3][6]

Core Insights - SUNation has been recognized as the number one solar + storage installer in New York by Solar Power World, having installed five times the battery storage capacity compared to local peers in 2023 [1][3] - The company is committed to helping New York State reduce its energy-related carbon footprint, as stated by the Interim CEO of Pineapple Energy [2] - SUNation's battery installations are trending upward in 2024, indicating the growing importance of battery storage in the renewable energy landscape [4][6] Company Overview - Pineapple Energy focuses on growing local and regional solar, storage, and energy services companies across the nation, aiming to facilitate the energy transition through grassroots solar and battery storage growth [5] - SUNation Energy has been trusted by over 9,000 customers since 2003, providing a comprehensive range of sustainable energy solutions including solar installation, battery storage, and EV charging [6] Industry Context - The solar market is experiencing growth in project size and complexity, making the achievements of top installation companies particularly noteworthy [3] - The recognition of SUNation in the Top Solar Contractors List serves as a benchmark for assessing the strength of individual companies in their local markets [3]