FTC Solar, Inc.

December 31, 2025

Note 1. Descr iption of business

FTC Solar, Inc. (the “Company”, “we”, “our”, or “us”) was founded in 2017 and is incorporated in the state of Delaware. In April 2021, we completed an initial public offering ("IPO"), and our common stock currently trades on the Nasdaq Capital Market ("Nasdaq") under the symbol “FTCI”.

We are a global provider of solar tracker systems, supported by proprietary software and value-added engineering services. Solar tracker systems move solar panels throughout the day to maintain an optimal orientation relative to the sun, thereby increasing the amount of solar energy produced at a solar installation. Our one module-in-portrait ("1P") solar tracker system is marketed under the Pioneer brand name ("Pioneer"), and our original two modules-in-portrait ("2P") solar tracker system is marketed under the Voyager brand name (“Voyager”). We also have a mounting solution to support the installation and use of U.S.-manufactured thin-film modules. Our primary software offerings include SUNPATH, which helps customers optimize solar tracking for increased energy production, and our SUNOPS real-time operations management platform. In addition, we have a team of renewable energy professionals available to assist our U.S. and worldwide clients in site layout, structural design, pile testing and other needs across the solar project development and construction cycle. Our products and services provide tracker solutions for large utility-scale solar and distributed generation projects around the world. Our customers are primarily engineering, procurement and construction companies ("EPCs") and we also contract with developers and owners. The Company is headquartered in Austin, Texas, and has international subsidiaries in Australia, China, India, South Africa and Spain.

We are an emerging growth company, as defined in the Jumpstart Our Business Startups (JOBS) Act. Under the JOBS Act, we elected to use the allowed extended transition period to delay adopting new or revised accounting standards until such time as those standards apply to private companies.

Note 2. Summary of significant accounting policies

Basis of presentation and principles of consolidation

The accompanying consolidated financial statements include the results of the Company and its wholly owned subsidiaries and have been prepared based on the assumption that the Company will continue as a going concern and are in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Intercompany balances and transactions have been eliminated in consolidation. As discussed further in "Liquidity and Going Concern" below, given the Company's current cash balances, subject to future minimum unrestricted cash covenants, and recurring losses from operations, management has concluded that there is substantial doubt about the Company's ability to continue as a going concern during the next year.

We will consolidate a Variable Interest Entity ("VIE") where it has been determined that we are the primary beneficiary of the entity's operations. The primary beneficiary is the party that has both the power to direct the activities that most significantly impact the VIE's economic performance and the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE. In evaluating whether we are the primary beneficiary, we will evaluate our power to direct the most significant activities of the VIE by considering the purpose and design of the entity and the risks the entity was designed to create and pass through to its variable interest holders. We also will evaluate our economic interests in the VIE.

We currently operate in one business segment, the manufacturing and servicing of solar tracker systems. See Note 23, "Segment information and certain concentrations" below for further discussion.

Liquidity and Going Concern

We have incurred cumulative losses since inception and have a history of cash outflows from operations, inclusive of$33.4 million in cash utilized for our operating activities during the year ended December 31, 2025. As of December 31, 2025, we had cash on hand of$21.1 million,$29.5 million of working capital,$22.6 million of net total debt and an accumulated deficit of$427.3 million.

ATM program

As of December 31, 2025, in addition to our cash on hand and working capital, we had approximately$9.0 million of remaining capacity available for future sales of our common stock under an effective prospectus supplement to our at the market facility under the At the Market Offering Agreement dated May 1, 2025 (the "Sale Agreement") with H.C. Wainwright & Co. LLC and the related prospectus covering the offering, issuance and sale of up to a maximum aggregate offering price of approximately $13.75 million of our common stock that may be sold under such At the Market Offering Agreement in at the market offerings (the "ATM program"). There can be no assurance regarding the price at which we will be able to sell such shares in the future, whether under the ATM program or other securities offerings, and any sales of our common stock under the ATM program or other securities offerings may be at prices that result in additional dilution to our existing stockholders.

Credit Agreement

As described further in Note 14, "Debt" below, on July 2, 2025 (the "Credit Agreement Closing Date"), we entered into a Credit Agreement (the "Original Credit Agreement") by and among the Company, as borrower, each lender party thereto (the "Lenders"), and Acquiom Agency Services LLC, as administrative agent for the Lenders. On November 11, 2025, we entered into the First Amendment to Credit Agreement with the administrative agent on behalf of the Lenders (the "First Amendment") to amend certain financial covenants applicable to us and in connection with our agreement to acquire 100% of the membership interests of Alpha Steel LLC ("Alpha Steel").

On March 23, 2026, we entered into a Second Amendment and Limited Waiver to Credit Agreement (the “Second Amendment” and the Original Credit Agreement as amended by the First Amendment and the Second Amendment, the “Credit Agreement”) pursuant to which: (i) the Lenders provided a waiver relating to our breach of the purchase order covenant for the fiscal quarter ended December 31, 2025; (ii) the Lenders agreed that a purchase order covenant will not apply to us until the fiscal quarter ending March 31, 2027; and (iii) we and the Lenders agreed to further amend the financial covenants under the Credit Agreement. The amended financial covenants applicable under the Credit Agreement are summarized below. Additionally, in connection with the Second Amendment, we agreed to repay a portion of the principal amount outstanding under the Credit Agreement as follows: (x) $2.5 million of principal was repaid on March 23, 2026; (y) $2.5 million of principal will be repaid on May 22, 2026; and (z) $5.0 million of principal will be repaid on September 30, 2026. The amount of each of the foregoing principal repayments is referred to as an "ECF Repayment Amount".

The Credit Agreement provides for a senior secured term facility of up to $75 million, consisting of (i) Initial Term Loans and First Delayed Draw Term Loans (both as defined in the Credit Agreement) that were funded during 2025 in an aggregate principal amount of $37.5 million, and (ii) up to $37.5 million principal amount of Second Delayed Draw Term Loans (as defined in the Credit Agreement) that may be requested by the Company and approved by the Lenders in their sole discretion (collectively, with the Initial Term Loans and the First Delayed Draw Term Loans, the "Term Loans"). The Term Loans currently outstanding mature on July 2, 2029.

As amended by the Second Amendment, the Credit Agreement includes the following financial covenants.

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Unrestricted Cash Amount. The Company is required to have unrestricted cash balances as of the last day of the fiscal quarter ending June 30, 2026 equal to the greater of (i) $15.0 million and (ii) $20.0 million minus the total ECR Repayment Amounts paid by the Company pursuant to the Credit Agreement on or prior to June 30, 2026. The Company currently anticipates that this covenant will require the Company to have at least $15.0 million in unrestricted cash as of June 30, 2026. The Company is further required to have unrestricted cash balances as of the last day of the fiscal quarter ending September 30, 2026 and each fiscal quarter thereafter equal to the greater of (i) $10.0 million and (ii) $20.0 million minus the total ECF Repayment Amounts actually paid by the Company to the Lenders pursuant to the Credit Agreement prior to such date. The Company currently anticipates that this financial covenant will require the Company to have at least $10.0 million of unrestricted cash as of September 30, 2026 and each fiscal quarter thereafter.

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Quarterly Revenue. The Company is required to have consolidated quarterly revenue of at least: (i) $25.0 million for the fiscal quarter ending June 30, 2026; (ii) $50.0 million for the fiscal quarter ending September 30, 2026; and (iii) $75.0 million for the fiscal quarter ending December 31, 2026 and the last day of each fiscal quarter thereafter. This revenue covenant does not apply for the quarter ending March 31, 2026.

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Consolidated EBITDA. For the 12-month period ending December 31, 2026, the Company’s consolidated EBITDA may not be less than $10.0 million, and for the 12-month period ending December 31, 2027 and the last day of each fiscal year thereafter, the Company’s consolidated EBITDA may not be less than $25.0 million.

Additionally, commencing with the fiscal quarter ending March 31, 2026, the Company’s direct tracker margin must exceed certain thresholds for each fiscal quarter, and the financial covenants include a requirement that the amounts due to the Company under new purchase orders must meet certain thresholds beginning with the fiscal quarter ending March 31, 2027.

Purchase of remaining interests in Alpha Steel

On November 11, 2025, we entered into a Membership Interest Purchase Agreement with Taihua New Energy (Thailand) Co. LTD. ("Taihua") and DAYV LLC (collectively, the "Selling Members") pursuant to which we agreed to purchase 100% of the Membership Interests of Alpha Steel, with such transaction closing on November 12, 2025. As consideration for the transactions under the Membership Interest Purchase Agreement, we agreed to pay the Selling Members a total of approximately $2.7 million for their Membership Interests in varying installments within five business days following each of January 1, 2026, April 1, 2026 and July 1, 2026 (the “Post-Closing Payments”). The Post-Closing Payments are evidenced by promissory notes issued by the Company to each of the Selling Members (the “Acquisition Notes”), and the Acquisition Notes have been secured by all of Alpha Steel’s assets; provided, however, the security interests granted to each of the Selling Members under the Acquisition Notes are subordinate and junior to the security interests in favor of the Lenders under the Credit Agreement.

Conclusion of substantial doubt

In view of the requirements for quarterly cash interest payments and certain specified principal payments under the Credit Agreement (including the required prepayments summarized above) and Amended and Restated Promissory Note and subsequent waiver agreement, principal and interest payments for the Acquisition Notes, as well as our prior default on the purchase order covenant under the Credit Agreement for the period ended December 31, 2025, recent financial performance, including our history of operating losses and cash outflows, and considering that the availability of additional financing provided by the Credit Agreement in the form of Second Delayed Draw Term Loans is not completely within our control, we believe these factors create uncertainty as to our ability to fully meet the financial covenant requirements under the Credit Agreement during the twelve months following issuance of this Annual Report. Therefore, we have concluded that substantial doubt exists as to our ability to continue as a going concern within the next year.

Our ability to meet our liquidity needs over the next year is dependent upon (i) our cash on hand (subject to (x) required principal repayments of $2.5 million and $5.0 million during May 2026 and September 2026, respectively, under the Credit Agreement and (y) a $15.0 million minimum unrestricted cash covenant under the Credit Agreement effective for the quarter ending June 30, 2026 and as further reduced by required principal repayments under the Credit Agreement thereafter) and our compliance with the financial covenants under the Credit Agreement, (ii) our current expectations of increased project activity and cash flow during the twelve-month period following issuance of our consolidated financial statements, (iii) the availability of additional proceeds in the form of Second Delayed Draw Term Loans that may be requested by the Company and approved by the Lenders in their sole discretion, (iv) utilization, as appropriate, of the capacity available for future sales of our common stock under the ATM program, and (v) if we determine necessary, our ability to raise additional capital through other securities offerings. In addition, we continue to remain focused on implementing additional cost savings steps, which could impact, among other things, the location of our headcount and the level of services currently provided by third parties.

Use of estimates

Preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported revenue and expenses during the period. Estimates are used for calculating the measure of progress of our solar tracker projects and deriving the standalone selling prices of the individual performance obligations when determining amounts to recognize for revenue, estimating allowances for credit losses and slow-moving and obsolete inventory, determining useful lives of long-lived assets and the estimated fair value of those assets for impairment assessments, and estimating the fair value of assets and liabilities acquired in business combinations, investments, warrants, stock compensation awards, warranty liabilities and federal and state taxes, including tax valuation allowances, as well as other contingencies. We base our estimates on historical experience and anticipated results, trends, and various other assumptions that we believe are reasonable under the circumstances, including assumptions as to future events. Actual results could differ from those estimates due to risks and uncertainties.

Concentrations of credit risk

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily cash, cash equivalents and accounts receivable.

We regularly maintain cash balances with various financial institutions that exceed federally insured amounts, but we have experienced no losses associated with these amounts to date. We periodically evaluate the financial health of the financial institutions we use and may take action in future periods, similar to past actions, to reallocate cash balances between financial institutions based on our evaluation.

We extend credit to customers in the normal course of business, often without requiring collateral. We also perform credit analyses and monitor the financial health of our customers to reduce credit risk.

Our accounts receivables are derived from revenue earned from customers primarily located in the United States, Australia and South Africa. None of our legal entities, other than the United States, accounted for 10% or more of our consolidated revenue included in these consolidated financial statements. Most of our customers are project developers, solar asset owners and engineering, procurement and construction (“EPC”) contractors that design and build solar energy projects. Often times, as discussed further in "Note 5, Accounts receivable, net" and "Note 23, Segment information and certain concentrations" below, a small number of customers account for a significant portion of our revenue for each period and our outstanding receivables at each period end.

Cash and cash equivalents

We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Certain of our cash equivalents include deposits in money market funds that invest primarily in short-term securities issued or guaranteed by the U.S. government or its agencies or instrumentalities and contain no restrictions on immediate redemption. Interest earned on cash equivalents is included in interest income in our Consolidated Statements of Comprehensive Loss.

Accounts receivable, net

Trade receivables are recorded at invoiced amounts, net of allowances for credit losses, and do not bear interest. We generally do not require collateral from our customers; however, in certain circumstances, we may require letters of credit, other collateral, additional guarantees or advance payments.

The allowance for credit losses is based on the lifetime expected credit loss of our customer accounts. To assess the lifetime expected credit loss, we utilize a loss rate method that takes into consideration historical experience and certain other factors, as appropriate, such as credit quality, current economic or other conditions and changes in project status that may affect a customer's ability to pay. Provisions for credit losses are included as a component of our selling and marketing expenses.

Receivables arising from revenue recognized in excess of billings represent our unconditional right to consideration before customers are invoiced due to the level of progress obtained as of period end on our contracts to procure and deliver tracker systems and related equipment. Further information may be found below in ourrevenue recognition policy.

Inventories

Inventories are stated at the lower of cost or net realizable value, with costs computed on a first-in, first-out basis. The Company periodically reviews its inventories for excess and obsolete items and adjusts carrying costs to estimated net realizable values when they are determined to be less than cost.

Leases

We make a determination whether a contract is a lease or contains a lease at the inception of the contract and will reassess that conclusion if the contract is modified. All leases are assessed for classification as an operating lease or a finance lease. Operating lease right-of-use (“ROU”) assets are reflected on the Company's Consolidated Balance Sheets. Operating lease liabilities are separated into a current portion, which is included in other current liabilities, and a noncurrent portion which is reflected separately on the Company's Consolidated Balance Sheets. The Company does not have any finance lease ROU assets or liabilities.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. The Company does not obtain and control its right to use the identified asset until the lease commencement date.

Our lease liabilities are recognized at the applicable lease commencement date based on the present value of the lease payments required to be paid over the lease term. Because the rate implicit in the lease is not readily determinable, we generally use our incremental borrowing rate to discount the lease payments to present value. The estimated incremental borrowing rate is derived from information available at the lease commencement date. We factor in publicly available data for instruments with similar characteristics when calculating our incremental borrowing rates. The Company's ROU assets are also recognized at the applicable lease commencement date. The ROU asset equals the carrying amount of the related lease liability, adjusted for any lease payments made prior to lease commencement and lease incentives provided by the lessor. Variable lease payments are expensed as incurred and do not factor into the measurement of the applicable ROU asset or lease liability.

The term of our leases equals the non-cancellable period of the lease, including any rent-free periods provided by the lessor, and also include options to renew or extend the lease (including by not terminating the lease) that we are reasonably certain to exercise. We establish the term of each lease at lease commencement and reassess that term in subsequent periods when one of the triggering events outlined in Accounting Standards Codification ("ASC") 842 occurs. Our operating lease cost for the lease payments is recognized on a straight-line basis over the lease term.

Our lease contracts often include lease and non-lease components. For facility leases, we elected the practical expedient offered by the standard to not separate lease from non-lease components and, therefore, account for them as a single lease component. For our other contracts that include leases, the Company accounts for the lease and non-lease components separately.

We have elected, for all classes of underlying assets, not to recognize ROU assets and lease liabilities for leases with a term of twelve months or less. Lease cost for short-term leases is recognized on a straight-line basis over the lease term.

Property and equipment, net

Cost

Property and equipment are stated at cost, net of accumulated depreciation. When assets are retired or otherwise disposed of, the cost and accumulated depreciation and amortization are removed from the accounts, and any resulting gain or loss is recorded in the Consolidated Statements of Comprehensive Loss. Maintenance and repair costs that do not extend the useful life or improve an asset, are expensed as incurred.

Third-party and internal personnel costs are capitalized during the application development stage of software developed or obtained for internal use or, for marketed software, once technological feasibility is reached. Costs incurred during the preliminary planning stage and post-implementation of new software systems projects, including data conversion and training costs, are expensed as incurred, as are costs for marketed software prior to the product reaching a stage of technological feasibility.

Depreciation

We depreciate our property and equipment using the straight-line method over their estimated useful lives, which generally are as follows:

Impairment

We review our long-lived assets that are held for use for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable or that its useful life may be shorter than previously expected. If such impairment indicators are present or other factors exist that indicate the carrying amount of the asset may not be recoverable, we determine whether an impairment has occurred through the use of an undiscounted cash flow analysis of the asset at the lowest level for which identifiable cash flows exist. If an impairment has occurred, we recognize a loss for the difference between the carrying amount and the fair value of the asset, which in most cases is estimated based upon Level 3 unobservable inputs. If the asset is determined to have a remaining useful life shorter than previously expected, an adjustment for the shorter remaining life will be made for purposes of recognizing future depreciation expense. Assets are classified as held for sale when we have a plan, approved by the appropriate levels of management, for disposal of such assets, as well as other considerations, and those assets are stated at the lower of carrying value or estimated fair value less estimated costs to sell.

Goodwill

We recognize goodwill as the excess of the purchase price over the estimated fair value of the identified assets and liabilities acquired in a business combination accounted for using the acquisition method. Goodwill is not amortized but is subject to a periodic assessment for impairment at least annually, or whenever events and circumstances indicate an impairment may exist. Our assessments may include qualitative factors such as current or expected industry and market conditions, our overall financial performance, share price trends, market capitalization and other company-specific events.

We operate in one segment, being the consolidated entity, which we have also determined is the reporting unit for goodwill impairment.

No impairment of goodwill was recognized as of December 31, 2025 or during 2024.

Equity method investment

We use the equity method of accounting for investments in which we have the ability to exercise significant influence, but not control, over operating and financial policies of the investee. Our proportionate share of the net income or loss of these investees is included in our Consolidated Statements of Comprehensive Loss. Judgment regarding the level of influence over each equity method investment includes considering key factors such as our ownership interest, legal form of the investee, representation on the board of directors or managers, participation in policy-making decisions and material intra-entity transactions.

We account for distributions received from equity method investees under the “nature of the distribution” approach based on the nature of the activity or activities of the investee that generated the distribution as either a return on investment (classified as cash inflows from operating activities) or a return of investment (classified as cash inflows from investing activities).

We evaluate equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment might not be recoverable. Factors considered by the Company when reviewing an equity method investment for impairment include the length of time and the extent to which the fair value of the equity method investment has been less than its cost, the investee’s financial condition and near-term prospects and the intent and ability to hold the investment for a period of time sufficient to allow for anticipated recovery. An impairment that is other than temporary is recognized in the period identified.

We made an accounting policy election that, upon the sale of our equity method investments, we will recognize contractual contingent gains arising from earnout provisions and project escrow releases when such amounts are realizable in periods subsequent to the disposal date.

Deferred costs

Debt discount and issue costs

Legal, consulting, accounting and other fees that are incremental and directly related to issuances of long-term debt, including any discounts on the debt, such as the fair value of associated warrants issued contemporaneously with the debt or debt original issue discounts, are capitalized and reflected as a reduction to the principal amount of our outstanding debt. These costs are amortized to interest expense over the term of the debt using the interest method. Similar costs relating to the establishment of a line of credit facility, with no current outstanding borrowings, will be capitalized and included as a component of other assets and amortized to interest expense on a straight-line basis over the term of the line of credit facility.

Equity offering costs

Legal, consulting, banking, accounting and other fees that are incremental and directly related to anticipated equity offerings are capitalized as incurred and offset against proceeds received upon consummation of the offering as a component of additional paid-in capital. In the event an anticipated offering is terminated, such costs will be expensed.

Warrants issued for the purchase of our common stock are evaluated for liability or equity classification and recorded at fair value upon issuance. Fair value may be determined using a Black-Scholes model or other valuation technique depending on the terms of the warrants, based primarily on Level 2 inputs. Warrants containing clauses that could require settlement in cash or with other assets are reflected as liabilities whereas warrants that may only be settled with the issuance of our common stock are reflected as a component of our equity. Warrants classified as liabilities are adjusted to current fair value at the end of each reporting period with changes reflected in our results of operations. Legal, consulting, accounting and other fees that are incremental and directly related to the issuance of warrants are expensed as incurred for warrants classified as liabilities or shown as a reduction to the value of our warrants as reflected in our equity.

Warranty

Typically, the sale of solar tracker projects includes parts warranties to customers as part of the overall price of the product. We provide standard assurance type warranties for our products for periods generally ranging from five toten years. We also accrue for costs relating to remediation efforts involving product issues we believe require correction. We record a provision for estimated warranty and remediation expenses in cost of sales, net of amounts recoverable from manufacturers under their warranty obligations to us. When historical claims information relating to our equipment is not sufficient, we will base our estimates on industry studies involving the nature and frequency of product failure rates for similar parts used by our competitors, as well as other related businesses. We do not maintain general or unspecified reserves; all warranty reserves are related to specific projects. All actual or estimated material costs incurred for warranty or remediation services in subsequent periods are charged to those established reserves.

While we periodically monitor our warranty activities and claims, if actual costs incurred were to be different from our estimates, we would recognize adjustments to our warranty reserves in the period in which those differences arise or are identified.

Stock-based compensation

We recognize compensation expense for all share-based payment awards made, including stock options and restricted stock units ("RSUs"), based on the estimated fair value of the award on the grant date. We calculate the fair value of stock options using the Black-Scholes option pricing model for awards with service-based vesting or through use of a lattice model or a Monte Carlo simulation for stock options and RSU awards with market conditions. The fair value of RSUs with only service or performance-based vesting is based on the estimated fair value of the Company's common stock on the date of grant. We consider the closing price of our stock, as reported on Nasdaq, to be the fair value of our stock on the grant date.

The Black-Scholes model and Monte Carlo simulations rely on various assumptions, in addition to the exercise price of the option and the value of our common stock on the date of grant. These assumptions include:

Expected Term: The expected term represents the period that the Company’s stock-based awards and warrants are expected to be outstanding and is calculated for option grants as the average of the option vesting and contractual terms, based on the simplified method, when we did not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term for options at the dates granted. The simplified method deems the term to be the average of the time-to-vesting and the contractual life of the options. The contractual life of an option may be up to 10 years. Monte Carlo simulations, as described below, estimate the derived service period of awards with market conditions.

Expected Volatility: Since the Company did not have a trading history of its common stock prior to our IPO and since such trading history subsequent to our IPO is limited and may be less than the expected term of an award or our warrants, the expected volatility is derived from a weighted average of (i) our historical volatility over our entire trading history, with respect to certain more recent awards, and, if needed, (ii) the average historical stock volatilities of several public companies within the Company’s industry that it considers to be comparable to its business over a period equivalent to the expected term of the stock option grants, or awards granted with market conditions.

Risk-Free Interest Rate: The Company bases the risk-free interest rate on the implied yield available on U.S. Treasury zero-coupon issues with a remaining term equivalent to the expected term.

Expected Dividend Yield: The Company has not issued any dividends in its history and does not expect to issue dividends over the life of the options or warrants and, therefore, has estimated the dividend yield to be zero.

We use Monte Carlo simulations for certain awards granted with market conditions which provide an estimated average present value for each award based on a simulation assuming Geometric Brownian Motion in a risk-neutral framework using up to 250,000 simulation paths to determine the derived service and vesting periods.

Forfeituresare accounted for as they occur. For service-based awards, stock-based compensation is recognized using the straight-line attribution approach over the requisite service period. For performance-based awards, stock-based compensation is recognized based on graded vesting over the requisite service period when the performance conditionis probable of being achieved. Stock compensation expense for market-based awards is recognized over the derived service period determined in the valuation model, inclusive of any vesting conditions.

Income taxes

Pursuant to ASC 740, Accounting for Income Taxes, we use the asset and liability method for accounting for income taxes. Under this method, we recognize deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the respective carrying amounts and tax basis of our assets and liabilities. Deferred tax balances are adjusted to reflect tax rates based on currently enacted tax laws, which will be in effect in the years in which the temporary differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period of the enactment date.

We establish valuation allowances when necessary to reduce deferred tax assets to the amounts expected to be realized. On a quarterly basis, we evaluate the need for, and the adequacy of, valuation allowances based on the expected realization of our deferred tax assets. The factors used to assess the likelihood of realization include our latest forecast of future taxable income, available tax planning strategies that could be implemented, reversal of taxable temporary differences and carryback potential to realize the net deferred tax assets.

We account for uncertain tax positions in accordance with authoritative guidance which prescribes a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. Our evaluations of tax positions consider various factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, information obtained during in-process audit activities and changes in facts or circumstances related to a tax position. We accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense.

Functional currency

The reporting currency of the Company is the U.S. dollar. We determine the functional currency of each subsidiary in accordance with ASC 830, Foreign Currency Matters, based on the currency of the primary economic environment in which each subsidiary operates. We translate the assets and liabilities of our non-U.S. dollar functional currency subsidiaries into U.S. dollars using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recognized as a cumulative translation adjustment in "Accumulated other comprehensive loss" in "Total stockholders’ equity (deficit)" in the Consolidated Balance Sheets.

The Company remeasures monetary assets and liabilities that are not denominated in the functional currency at exchange rates in effect at the end of each period. Foreign currency gains or losses realized or from remeasurement are reflected in "Other income, net" in our Consolidated Statements of Comprehensive Loss.

Revenue recognition

Product revenue is derived from the sale of solar tracker systems and customized components for those systems, individual part sales for certain specific transactions and the sale of term-based software licenses. Term-based licensed software is deployed on the customers’ own servers and has significant standalone functionality.

Service revenue includes revenue from shipping and handling services, engineering consulting and pile testing services, our subscription-based enterprise licensing model and maintenance and support services in connection with the term-based software licenses. Our subscription-based enterprise licensing model typically has contract terms ranging fromone totwo years and consists of subscription fees from the licensing of subscription services. Our hosted on-demand service arrangements do not provide customers with the right to take possession of the software supporting the hosted services. Support services include ongoing security updates, upgrades, bug fixes, and maintenance.

We recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which we expect to be entitled to in exchange for those goods or services by following a five-step process: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when or as the Company satisfies a performance obligation, as further described below.

Identify the contract with a customer: A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the products and services to be transferred and identifies the payment terms related to these products and services, (ii) the contract has commercial substance, and (iii) the Company determines that collection of substantially all consideration for products and services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. In assessing the recognition of revenue, we also evaluate whether two or more contracts should be combined and accounted for as one contract and if the combined or single contract should be accounted for as multiple performance obligations which could change the amount of revenue and profit (loss) recorded in a period. Change orders may include changes in specifications or design, manner of performance, equipment, materials, scope of work, and/or the period of completion of the project. We analyze change orders to determine if they should be accounted for as a modification to an existing contract or a new stand-alone contract.

Contracts we enter into with our customers for sale of solar tracker systems are generally under two different types of arrangements: (1) purchase agreements and equipment supply contracts (“Purchase Agreements”), and (2) sale of individual parts for those systems.

Change orders from our customers that are deemed to be modifications to existing contracts are included in the total estimated contract revenue when it is probable that the change order will result in additional value that can be reliably estimated and realized.

Identify the performance obligations in the contract: We enter into contracts that can include various combinations of products and services, which are either capable of being distinct and accounted for as separate performance obligations or as one performance obligation since the majority of tasks and services are part of a single project or capability. However, determining whether products or services are considered distinct performance obligations that should be accounted for separately versus together may sometimes require significant judgment.

Our Purchase Agreements typically include two performance obligations: 1) our solar tracker systems or customized components of those systems, and 2) shipping and handling services. The deliverables included as part of our solar tracker systems are predominantly accounted for as one performance obligation, as these deliverables are part of a combined promise to deliver a project.

The revenue for shipping and handling services will be recognized over time based on progress in meeting shipping terms of the arrangements, as this faithfully depicts the Company’s performance in transferring control. Revenue for stand-alone engineering consulting and pile testing services is recognized at a point in time upon completion of the services performed.

Sales of individual parts of our solar tracker systems for certain specific transactions include multiple performance obligations consisting of individual parts of those systems. Revenue is recognized for parts sales at a point in time when the obligations under the terms of the contract with our customer are satisfied. Generally, this occurs with the transfer of control of the asset, which is in line with shipping terms.

Determine the transaction price: The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring services to the customer. Such amounts are typically stated in the customer contract, and to the extent that we identify variable consideration, we will estimate the variable consideration at the onset of the arrangement as long as it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. Other than with respect to the impact of changes in tariff rates, the majority of our contracts do not contain variable consideration provisions as a continuation of the original contract. None of our contracts contain a significant financing component. Taxes collected from customers and remitted to governmental authorities are not included in revenue.

Allocate the transaction price to performance obligations in the contract: Once we have determined the transaction price, we allocate the total transaction price to each performance obligation in a manner depicting the amount of consideration to which we expect to be entitled in exchange for transferring the good(s) or service(s) to the customer. We allocate the transaction price to each performance obligation identified in the contract on a relative standalone selling price basis.

We use the expected cost-plus margin approach based on hardware, labor, and related overhead cost to estimate the standalone selling price of our solar tracker systems, customized components of those systems, and individual parts for certain specific transactions. We also use the expected cost-plus margin approach based on expected third-party shipping and transportation costs to estimate the standalone selling price of our shipping, handling and logistics performance obligations. We use the adjusted market assessment approach for all other performance obligations.

Recognize revenue when or as the Company satisfies a performance obligation: For each performance obligation identified, we determine at contract inception whether we satisfy the performance obligation over time or at a point in time. The performance obligations in the contracts for our solar tracker systems and customized components of those systems are satisfied over time as work progresses, utilizing an input measure of progress determined by cost-to-cost measures on these projects as this faithfully depicts our performance in transferring control. Additionally, our performance does not create an asset with an alternative use, due to the highly customized nature of the product, and we have an enforceable right to payment for performance completed to date. Our performance obligations for individual part sales for certain specific transactions are recognized at a point in time as and when control transfers based on the terms for the contract. Our performance obligations for engineering consulting and pile testing services are recognized at a point in time upon completion of the services. Our performance obligations for term-based software licenses are recognized at a point in time as and when control transfers, either upon delivery to the customer or the software license start date, whichever is later. Our performance obligations for shipping and handling services are satisfied over time as the services are delivered over the term of the contract. We recognize revenue for subscription and other services on a straight-line basis over the contract period. With regard to support revenue, a time-elapsed method is used to measure progress because we transfer control evenly over the contractual period. Accordingly, the fixed consideration related to support revenue is generally recognized on a straight-line basis over the contract term.

Impact of changes in tariffs on our revenue recognition: In cases where our existing contracts have legally enforceable terms that allow us to pass the increased cost of tariffs to our customers automatically, any change in the transaction price will be accounted for as a change in our estimate of variable consideration and allocated to our performance obligations on the same basis as our initial allocation at contract inception. Where price changes resulting from tariffs need to be separately negotiated and agreed to with our customers, we will apply contract modification guidance once the modification is enforceable. We will also take into account tariff rates in effect at each period end in measuring our progress toward satisfaction of our performance obligations in recognizing revenue.

Contract assets and liabilities: The timing of revenue recognition, billing, and cash collection results in the recognition of accounts receivable, unbilled receivables for revenue recognized in excess of billings, and deferred revenue in the Consolidated Balance Sheets. We have elected to use the practical expedient of expensing incremental costs of obtaining a contract for our contracts of less than one year in duration. We may receive advances or deposits from our customers before revenue is recognized, resulting in contract liabilities, which are reflected as “deferred revenue” in our Consolidated Balance Sheets. Customer deposits are short term as the related performance obligations are typically fulfilled within 12 months. Changes in deferred revenue relate to fluctuations in the timing of customer deposits and completion of performance obligations. Revenue recognized during the years ended December 31, 2025 and 2024 from amounts included in deferred revenue at each respective prior year end totaled$5.3 million and$3.6 million, respectively, and were equal to the amount of each respective prior year-end deferred revenue balance.

Cost of revenue consists primarily of costs related to raw materials, equipment manufacturing activities, net of incentives earned, freight and delivery, tariffs, product warranty, remediation and personnel costs (salaries, bonuses, benefits, and stock-based compensation). Personnel costs in cost of revenue include both direct labor costs, as well as costs attributable to any individuals whose activities relate to the procurement, installment and delivery of the finished product and services. Cost of revenue owed but not yet paid is recorded as accrued cost of revenue in the accompanying Consolidated Balance Sheets. Deferred cost of revenue, a component of our prepaid and other current assets, results from the timing differences between the costs incurred in advance of the satisfaction of all revenue recognition criteria consistent with our revenue recognition policy.

Inflation Reduction Act of 2022 (“IRA”)

The IRA was enacted into law on August 16, 2022, and provides for various clean energy credits, including an Advanced Manufacturing Production Credit under Section 45X of the Internal Revenue Code of 1986, as amended (“45X Credit”) for eligible parts, including torque tubes and structural fasteners. Prior to our acquisition of a controlling interest in Alpha Steel, as described further in Note 3, "Acquisition and disposition", below, our agreements with Alpha Steel allowed for us to receive benefit of the 45X Credits earned by Alpha Steel in the form of reductions to the purchase price of the products manufactured for us on a per-unit basis. Since the acquisition of Alpha Steel, we have continued to receive the economic benefit of the 45X Credits earned by Alpha Steel. Utilizing guidance in IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, we recognize the benefits of these reductions as they are earned during the manufacturing process and currently reflect them as receivables and a reduction of our cost of revenue.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act ("OBBB"), which accelerates the phase-outs and terminations of various eligible tax credits enacted as part of the IRA. We are evaluating the applicability of these provisions to Alpha Steel's ability to generate 45X Credits and the extent to which those credits continue to reduce our manufacturing input costs. Any reduction in the availability or monetization of these credits could increase our costs and adversely affect results of operations.

Researchand development costs are expensed as incurred and consist primarily of personnel costs, including salaries, bonuses, benefits, and stock-based compensation, along with other costs related to development of new productsand services, as well as enhancing system performance, improving product reliability, reducing product cost, and simplifying installation. Research and development costs also include depreciation and allocated overhead.

Advertising costs

Advertising costs are expensed as incurred and are included in selling and marketing expenses in the accompanying Consolidated Statements of Comprehensive Loss.

Fair value of financial instruments

Our financial instruments consist of cash, cash equivalents, accounts receivable, accounts payable, warrants and debt obligations. Cash, cash equivalents, accounts receivable and accounts payable are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. We estimate the fair value of our warrants using a Black-Scholes model involving current assumptions at each reporting period of (i) the per share value of our common stock, (ii) the expected holding period of the warrants before exercise, (iii) the estimated volatility of our stock over the expected holding period of the warrants, (iv) a risk free interest rate over the expected holding period of the warrants and, (v) an estimated dividend yield on our common stock over the expected holding period of the warrants. Each of those assumptions are subject to change over time. The fair value of our fixed-rate debt obligations is estimated based primarily on Level 2 inputs involving credit spreads on similar debt and other market participant factors involving observed secured and unsecured recovery rates for similar debt subsequent to our initial borrowings.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. A hierarchy for inputs used in measuring fair value has been defined to minimize the use of unobservable inputs by requiring the use of observable market data when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on active market data. Unobservable inputs we select reflect our assumptions about what market participants would use in pricing the asset or liability based on the best information currently available.

The fair value hierarchy prioritizes the inputs into three broad levels:

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Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities.

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Level 2: Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability.

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Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

We account for our long-term debt on an amortized cost basis.

Recent accounting and regulatory pronouncements not yet adopted

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU No. 2023-09 - Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 requires companies to disclose (i) additional categories of information about federal, state and foreign income taxes above a quantitative threshold in their rate reconciliation table and (ii) income taxes paid, net of refunds, disaggregated by federal, state and foreign taxes for annual periods, as well as other disclosure changes. As an emerging growth company, we are not required to adopt ASU 2023-09 prior to 2026. We are currently evaluating the impact of ASU 2023-09 on our existing income tax disclosures.

In November 2024, the FASB issued ASU 2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-04) ("ASU 2024-03"). ASU 2024-03 requires companies to disclose additional specific information including, among other things, (a) purchases of inventory, (b) employee compensation, (c) depreciation, and (d) intangible asset amortization included in each of its expense captions disclosed on the face of its results of operations statement, as well as total selling expenses. As clarified in ASU 2025-01, we are currently required to adopt ASU 2024-03 for our annual reporting effective December 31, 2027 and in our quarterly reporting beginning in 2028.

In May 2025, the FASB issued ASU 2025-04, Compensation - Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606). This new guidance applies to all entities that issue share-based consideration to a customer that is within the scope of Topic 606. The guidance revises the definition of a performance condition to include conditions based on a customer's purchases and eliminates the policy election allowing grantors to account for forfeitures of customer awards as they occur. It also clarifies that the guidance on constraining estimates of variable consideration does not apply to share-based consideration payable to a customer. We are currently required to adopt this new standard on either a modified retrospective or a retrospective basis beginning in the first quarter of 2027. We are evaluating the impact, if any, on the Company upon adoption and have made no determination at this time regarding the method of adoption to be used.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326) ("ASU 2025-05"). This new guidance provides companies with a practical expedient to assume that current conditions as of the balance sheet date will persist through a reasonable and supportable forecast period when adjusting historical data to be used in the estimation of credit losses. We currently anticipate adopting ASU 2025-05 on a prospective basis beginning in 2026.

In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832) ("ASU 2025-10"). This new guidance establishes the accounting for a government grant received by a business entity, including guidance for (i) a grant related to an asset and (ii) a grant related to income. The standard is effective for public business entities for annual reporting periods beginning after December 15, 2028 and, for other than public business entities, for annual reporting periods beginning after December 15, 2029. We are currently evaluating this standard in relation to our current accounting treatment of 45X Credits described above and are assessing the available transition methods for adopting this new standard.

Other standards that have been issued but not yet adopted as of December 31, 2025, are either not applicable to us or are not expected to have any material impact upon adoption.

Reclassification

Prior year amounts relating to interest income in our Consolidated Statements of Comprehensive Loss have been reclassified to conform to the current year presentation. There was no impact on our financial condition or results of operations as a result of the reclassification.

Note 3. Acquisition and disposition

Acquisition

As described further in Note 11, "Equity method investment" below, on February 9, 2023, we entered into an LLC Agreement with Taihua and DAYV LLC for the creation of Alpha Steel, an entity dedicated to producing steel components, including torque tubes and structural fasteners, for utility-scale and distributed generation solar projects. We initially held a 45% interest in Alpha Steel, accounted for under the equity method, whereas Taihua and DAYV LLC owned 51% and 4%, respectively.

On November 11, 2025, we entered into a Membership Interest Purchase Agreement with the Selling Members pursuant to which we agreed to purchase 100% of the Membership Interests of Alpha Steel, with such transaction closing on November 12, 2025. As consideration for the transactions under the Membership Interest Purchase Agreement, we agreed to pay the Selling Members a total of approximately $2.7 million for their Membership Interests in varying installments within five business days following each of January 1, 2026, April 1, 2026 and July 1, 2026. The Post-Closing Payments are evidenced by the Acquisition Notes issued by the Company to each of the Selling Members, and the Acquisition Notes have been secured by all of Alpha Steel’s assets; provided, however, the security interests granted to each of the Selling Members under the Acquisition Notes are subordinate and junior to the security interests in favor of the Lenders under the Credit Agreement. The Acquisition Notes bear interest at 3.64% per annum on outstanding balances and mature no later than five business days after July 1, 2026.

The Membership Interest Purchase Agreement includes customary representations and warranties, covenants, and indemnities, in each case under the circumstances and subject to certain limitations set forth in the Membership Interest Purchase Agreement. The indemnification obligations under the Membership Interest Purchase Agreement are subject to customary deductibles and caps. The Company’s primary source of recovery for indemnifiable damages is set off of such damages against the Post-Closing Payments.

Aspart of the transactions contemplated by the Membership Interest Purchase Agreement, we and CZT Energy (USA) Inc. (“CZT”) entered into a Transition Services and Management Agreement, pursuant to which CZT agreed to provide certain transition support and management services to Alpha Steel following the closing of the transactions under the Membership Interest Purchase Agreement. In consideration of such services, we agree to pay a lump sum of$375,000 for the transition services and a quarterly fee of $125,000 for the management services, with the quarterly fee commencing six months after the closing under the Membership Interest Purchase Agreement.

Immediately prior to the November 12, 2025, the estimated fair value of our equity method investment for our 45% ownership interest in Alpha Steel totaled approximately$2.5 million.

Following is information relating to the fair value of the net assets of Alpha Steel that have been consolidated into our financial statements as a result of our initial investment in Alpha Steel and the transactions under the Membership Interest Purchase Agreement:

Largely as a result of an increase in Alpha Steel's net assets from the date the purchase price was established to the November 12, 2025, we recognized a bargain purchase gain of$0.4 million in connection with our acquisition of the remaining interest in Alpha Steel.

Costs incurred in connection with this transaction were not material to our consolidated results. The results of operations attributable to Alpha Steel for the year ended December 31, 2025 were not material. Pro forma information has not been included as the acquisition of Alpha Steel did not have a material impact on our consolidated statements of comprehensive loss for the year ended December 31, 2025.

Disposition

On December 2, 2024, we entered into an asset purchase agreement with a third-party for the sale of certain assets, including intellectual property, associated with our Atlas web-based software platform, used by customers to organize and manage their solar project portfolios, for a price of $0.9 million, plus future potential earnout payments. We also provided certain assistance involving existing customer relationships and access to various systems, including websites, necessary to support the Atlas platform for nine months following the closing. The incremental cost for such assistance was minimal. During the year ended December 31, 2024, we recognized a gain of$0.9 million from the sale of these assets. Revenue associated with the Atlas software platform was not material to our consolidated results during 2024.

In accordance with our existing accounting policy, we recognize a gain from contingent earnout payments upon receipt. During the year ended December 31, 2025, we received and recognized a gain for such earnout payments totaling$0.1 million.

Note 4. Reduction in force

In the fourth quarter of 2024, in order to adjust our overhead costs to reflect market conditions and activity levels at that time, as well as to take advantage of process efficiencies we had gained in previous years due to our design-to-value and cost reduction efforts, we reduced our headcount by 30 employees, or approximately 12% of our existing headcount at that time. Certain of the headcount changes also reflected a shift of our employee base to more cost-effective markets with exceptional talent. We also incurred certain additional involuntary severance and termination-related costs in early 2025.

Involuntary severance and termination-related costs recognized were as follows:

All 2025 costs were paid to former employees during 2025. At December 31, 2024, we had accruals totaling approximately$0.2 million for payments that were also made to our former employees during 2025. Payments made to former employees during 2024 from a prior year reduction in force totaled approximately$3.1 million.

Note 5. Accounts receivable, net

Accounts receivable consisted of the following:

Information about our related party receivables at December 31, 2024, may be found below in Note 19, "Related party transactions".

We bill our customers for contracted amounts in accordance with agreed-upon contractual terms, which generally coincide with achievement of specified milestones on a project, such as completion of engineering, shipment, delivery or commissioning. Changes in our revenue recognized in excess of billings relate to fluctuations in the timing of billings in relation to the amount of revenue recognized over time as work progresses.

Other receivables at December 31, 2025 primarily relate to 45X Credits earned by Alpha Steel in connection with their manufacturing activity.

At December 31, 2025, three customers accounted for approximately 21%,20%, and 14%, respectively, of our customer accounts receivable. At December 31, 2024, three customers accounted for approximately 42%,21% and 11%, respectively, of our customer accounts receivable.

Activity in the allowance for credit losses in 2025 and 2024, primarily resulting from changes in collectibility estimates related to specific customer accounts, was as follows:

Note 6. Inve ntories

Inventories consisted of the following:

Activity in the allowance for slow-moving and obsolete inventory for each period was as follows:

Note 7. Prepaid and other current assets

Prepaid and other current assets consisted of the following:

At December 31, 2025 and 2024, other current assets included$2.0 million for a non-interest-bearing advance to a customer related to pre-project construction financing activities. This advance is secured by certain customer assets and is currently due.

Additional information about vendor deposits with a related party may be found below in Note 19, "Related party transactions".

Note 8. Leases

We lease office and warehouse space in various locations, including in the United States, India and Australia. Additionally, we lease space for an applications laboratory in Austin, Texas and research and development facilities in both Seguin, Texas and India. Apart from our acquisition of Alpha Steel, and the related sublease we have on the Alpha Steel facility, the remainder of our manufacturing is outsourced to contract manufacturing partners, and we currently do not own or lease any other manufacturing facilities.

We utilized a weighted average discount rate of approximately 10% in establishing our operating lease ROU assets and liabilities at lease inception. At December 31, 2025, our weighted average remaining lease term for our operating leases was approximately 2.5 years.

Our expense for our operating leases consisted of the following:

Future remaining operating lease payment obligations were as follows:

Note 9. Prop erty and equipment, net

Property and equipment consisted of the following:

We recognized depreciation expense associated with our property and equipment each period as follows:

Note 10. Goodwill

Activity in our goodwill balance, arising largely from our acquisition in 2022 of HX Tracker, a China-based supplier of tracker systems, was as follows:

Note 11. Equity method investment

On February 9, 2023, we entered into an LLC Agreement to acquire a 45% interest in Alpha Steel that we accounted for under the equity method of accounting as we were not the primary beneficiary in the operations of this entity as a result of our variable interest. The Selling Members held the remaining 55% interest in Alpha Steel.

Largely as a result of certain provisions in the OBBB, and as disclosed in Note 3, "Acquisition and disposition" above, on November 12, 2025, we purchased 100% of the Membership Interests of Alpha Steel.

In connection with the initial creation of Alpha Steel, we had also entered into an equipment supply agreement with Alpha Steel (as amended, the "Supply Agreement"), effective through June 30, 2027, the terms of which applied to our equipment purchase orders with Alpha Steel.

For the period January 1, 2025 through November 12, 2025 we recognized our share of Alpha Steel's net operating profit of$1.6 million in "Income (loss) from unconsolidated subsidiary" in our Consolidated Statements of Comprehensive Loss. Our share of Alpha Steel's net operating losses for the year ended December 31, 2024 was$1.1 million.

At December 31, 2024, we were contingently liable for issued but unsatisfied purchase orders of Alpha Steel totaling approximately$0.2 million.

Note 12. Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following:

Information about our related party accrued cost of revenue at December 31, 2024, may be found below in Note 19, "Related party transactions".

Other accrued expenses primarily include amounts due for (i) legal and other costs associated with outstanding legal matters and (ii) other professional services.

Activity by period in the Company's warranty accruals was as follows:

Note 13. Income taxes

The components of our loss before income taxes were as follows:

Theprovision for income taxes and the reasons for the differences between provision for income taxes using the U.S. federal income tax rate were as follows:

The components of deferred tax assets and liabilities were as follows:

The net change in the total valuation allowance for the year ended December 31, 2025, was an increase of$10.1 million recorded through continuing operations. The net change in the total valuation allowance for the year ended December 31, 2024, was an increase of$10.7 million recorded through continuing operations. In assessing the realizability of deferred tax assets, we considered whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. We considered the scheduled reversal of deferred tax liabilities, carryback potential, projected future taxable income and tax planning strategies in making this assessment. After consideration of these factors and based upon the level of historical taxable losses, we believe it is more likely than not that the Company will not realize the benefits of these deductible differences at December 31, 2025.

We have federal net operating loss carryforwards of approximately$358.2 million at December 31, 2025. These loss carryforwards have an indefinite carryforward period. We also have state net operating loss carryforwards of approximately$156.3 million which begin to expire in 2034.

We have federal general business credit carryforwards of approximately$2.4 million at December 31, 2025, which begin to expire in 2038.

The Internal Revenue Code of 1986, as amended, imposes restrictions on the utilization of net operating losses in the event of an “ownership change” of a corporation. Accordingly, a company’s ability to use net operating losses may be limited as prescribed under Internal Revenue Code Section 382 (“IRC Section 382”). Events which may cause limitations in the amount of the net operating losses that the Company may use in any one year include, but are not limited to, a cumulative ownership change of more than 50% over a three-year period. Utilization of the federal and state net operating losses may be subject to substantial annual limitation due to the ownership change limitations provided by the IRC Section 382 and similar state provisions. An ownership change, as defined under Section 382, occurred on December 31, 2021; however, as of the balance sheet date, all the pre-change net operating losses would not be limited by Section 382 due to the cumulative limit.

We are subject to U.S. federal income tax, as well as income tax in multiple state and foreign jurisdictions. The tax returns for years 2018 and beyond remain open for examination. As of December 31, 2025, we are not currently under audit by any taxing authority.

We account for uncertainty in taxes in accordance with authoritative guidance. Changes in our accruals for unrecognized tax benefits were as follows:

The unrecognized tax benefits would not impact the effective tax rate if recognized due to the valuation allowance. We donot anticipate a significant increase or decrease over the next twelve months in the unrecognized tax benefits reported above. As of December 31, 2025, and 2024, we havenot accrued any interest or penalties related to unrecognized tax benefits.

Note 14. Debt

Acquisition notes

As described further in Note 3, "Acquisition and disposition" above, as consideration for the transactions under the Membership Interest Purchase Agreement, we agreed to pay Post Closing Payments totaling approximately$2.7 million to the Selling Members of Alpha Steel in varying installments within five business days following each of January 1, 2026, April 1, 2026 and July 1, 2026. These payments are secured by Acquisition Notes bearing interest on any unpaid balance at a rate of 3.64% per annum, maturing no later than five business days after July 1, 2026. The short-term Acquisition Notes, as reflected above, have been discounted using a market-participant discount rate resulting in an effective interest rate of approximately 12% until maturity.

Credit agreement and warrant issuance

Onthe Credit Agreement Closing Date, we entered into the Original Credit Agreement with the Lenders, and Acquiom Agency Services LLC, as administrative agent for the Lenders. On November 11, 2025, we entered into the First Amendment to Credit Agreement to amend certain of the financial covenants applicable to us and in connection with our agreement to acquire 100% of the membership interests of Alpha Steel.

On March 23, 2026, we entered into the Second Amendment pursuant to which: (i) the Lenders provided a waiver relating to our breach of the purchase order covenant for the fiscal quarter ended December 31, 2025; (ii) the Lenders agreed that a purchase order covenant will not apply to us until the fiscal quarter ending March 31, 2027; and (iii) we and the Lenders agreed to further amend the financial covenants under the Credit Agreement. Additionally, pursuant to the Second Amendment, we agreed to repay a portion of the principal amount of the loans outstanding under the Credit Agreement as follows: (x) on the date of the Second Amendment, we repaid $2.5 million of principal and; (y) we are required to repay an additional $2.5 million of principal on May 22, 2026; and (z) $5.0 million of principal on September 30, 2026.

The Credit Agreement provides for a senior secured term facility of up to $75 million, consisting of (i) Initial Term Loans and First Delayed Draw Term Loans (both as defined in the Credit Agreement) that were funded during 2025 in an aggregate principal amount of $37.5 million, and (ii) up to $37.5 million principal amount of Second Delayed Draw Term Loans (as defined in the Credit Agreement) that may be requested by the Company and approved by the Lenders in their sole discretion (collectively, with the Initial Term Loans and the First Delayed Draw Term Loans, the "Term Loans"). The Term Loans currently outstanding mature on July 2, 2029.

The funding of the First Delayed Draw Term Loans occurred following the approval by the Company's stockholders on September 4, 2025, in accordance with Nasdaq Listing Rule 5635(d), of the issuance of an aggregate 6,836,237 shares of our common stock issuable upon exercise of certain warrants (the "New Warrants") granted to the Lenders on the Credit Agreement Closing Date, in excess of certain caps that were applicable to the exercise of New Warrants in the absence of such Company stockholder approval. The New Warrants are (i) exercisable at any time through July 2, 2035, at an exercise price of $0.01 per share, (ii) accounted for as a long-term liability, based on terms that could require cash settlement upon the occurrence of a contingent change in control event, and (iii) were valued at approximately $32.1 million in aggregate on the grant date.

In the event of a change of control of the Company, a holder of the New Warrants may, at its option, elect to exercise its New Warrants or exercise a repurchase option that requires the Company to repurchase its New Warrants upon the consummation of the change of control for a cash amount equal to the Black Scholes Value (as defined in the New Warrants). Additionally, the New Warrants provide each holder with a pro rata purchase right (based on the total number of shares of common stock held by a holder and the number of shares issuable upon exercise of the New Warrants) in the event the Company issues any equity securities, convertible securities or rights, options or warrants to purchase equity securities, subject to customary exceptions and conditions. The New Warrants include other customary terms and provisions, including adjustment provisions relating to stock splits, stock dividends, reclassifications and other recapitalization events.

The Company is utilizing the proceeds from the Credit Agreement for balance sheet support, growth acceleration and general corporate purposes.

Key terms

The Term Loans bear interest at 12.00% per annum. A portion of the interest equal to 7.00% per annum is being capitalized and added as paid-in-kind interest and will increase the outstanding principal amount of the Term Loans. The remainder of the interest will be paid in cash at the end of each fiscal quarter. Upon the occurrence and during the continuation of certain events of default under the Credit Agreement ("Events of Default") or upon the election of certain required Lenders during the occurrence and continuation of any Event of Default, the interest rate applicable to the Term Loans will be increased by a 7.00% default interest rate, which would be capitalized and added to the principal amount of the debt.

Inaddition to the required prepayments of the ECF Repayment Amounts summarized above, the Credit Agreement also provides for the mandatory prepayment of the indebtedness and other obligations outstanding under the Credit Agreement and other applicable loan documents upon the occurrence of certain events (including in connection with a change in control of the Company) and upon acceleration following an Event of Default (an "Exit Fee Event"). If an Exit Fee Event occurs, the Company shall pay an exit fee (the "Exit Fee") equal to (x) the aggregate amount of all Term Loans extended by the Lenders under the Credit Agreement, multiplied by (y) the Exit Fee

Percentage, minus (z) the amount of interest paid in cash by the Company prior to the Exit Fee Event, where the "Exit Fee Percentage" equals 25% in connection with a change of control transaction, or otherwise equals 50%

The Credit Agreement includes customary repayment and prepayment terms, affirmative and negative covenants and representations and warranties, including restrictions on payment of dividends and other covenants.

The Company and certain of its subsidiaries from time-to-time party thereto guarantee the obligations under the Credit Agreement and other Loan Documents. In addition, such obligations are secured by a first priority lien on substantially all tangible and intangible property of the Company and the guarantors and pledges of the equity of certain Company subsidiaries, in each case subject to certain exceptions, limitations and exclusions for the collateral.

Financial covenants

As amended by the Second Amendment, the Credit Agreement includes the following covenants.

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Unrestricted Cash Amount. The Company is required to have unrestricted cash balances as of the last day of the fiscal quarter ending June 30, 2026 equal to the greater of (i) $15.0 million and (ii) $20.0 million minus the total ECR Repayment Amounts paid by the Company pursuant to the Credit Agreement on or prior to June 30, 2026. The Company currently anticipates that this covenant will require the Company to have at least $15.0 million in unrestricted cash as of June 30, 2026. The Company is further required to have unrestricted cash balances as of the last day of the fiscal quarter ending September 30, 2026 and each fiscal quarter thereafter equal to the greater of (i) $10.0 million and (ii) $20.0 million minus the total ECF Repayment Amounts actually paid by the Company to the Lenders pursuant to the Credit Agreement prior to such date. The Company currently anticipates that this financial covenant will require the Company to have at least $10.0 million of unrestricted cash as of September 30, 2026 and each fiscal quarter thereafter.

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Quarterly Revenue. The Company is required to have consolidated quarterly revenue of at least: (i) $25.0 million for the fiscal quarter ending June 30, 2026; (ii) $50.0 million for the fiscal quarter ending September 30, 2026; and (iii) $75.0 million for the fiscal quarter ending December 31, 2026 and the last day of each fiscal quarter thereafter. This revenue covenant does not apply for the quarter ending March 31, 2026.

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Consolidated EBITDA. For the 12-month period ending December 31, 2026, the Company’s consolidated EBITDA may not be less than $10.0 million, and for the 12-month period ending December 31, 2027 and the last day of each fiscal year thereafter, the Company’s consolidated EBITDA may not be less than $25.0 million.

Additionally, commencing with the fiscal quarter ending March 31, 2026, the Company’s direct tracker margin must exceed certain thresholds for each fiscal quarter, and the financial covenants include a requirement that the amounts due to the Company under new purchase orders must meet certain thresholds beginning with the fiscal quarter ending March 31, 2027.

At December 31, 2025, the Company was in compliance with all the financial covenants under the Credit Agreement, other than the purchase order covenant for which the Lenders provided a limited waiver pursuant to the Second Amendment.

Debt and warrant issue costs

The Company incurred approximately$1.5 million of costs associated with the issuance of the Term Loans, including lender original issue discount and third-party fees, which are being amortized as additional interest expense over the life of the debt, and approximately$0.2 million of third-party costs were incurred associated with the issuance of the Warrants, which were expensed as incurred.

Previously existing debt and warrants

On December 4, 2024, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor as the purchaser under the Purchase Agreement (the “Investor”). Pursuant to the Purchase Agreement, we sold, and the Investor purchased, $15.0 million in principal amount of senior secured promissory notes (the “Senior Notes”) and warrants exercisable for 1,750,000 shares of our common stock (the “ Original Warrants”) (the “Offering”). A member of our Board of Directors, Pablo Barahona, invested $500,000 in the Investor, which was used to finance a portion of the purchase price of the Offering.

Pursuant to the terms of the Senior Notes, we elected to increase the outstanding principal amount of the Senior Notes by an amount of interest at a rate of 13%per annum ("paid-in-kind" interest) capitalized semiannually on the final business day in June and December of each year. As a result, our outstanding principal balance of the Senior Notes was approximately $16.1 million as of July 2, 2025. The Senior Notes were initially secured by substantially all of our assets.

The Original Warrants issued in the Offering were exercised on June 30, 2025 at an exercise price of $0.10 per share, in return for the issuance of 1,750,000 shares of our common stock. We had previously determined liability classification for the Original Warrants was required based on terms that could require cash settlement upon the occurrence of a contingent change in control event. As a result, the Original Warrants were revalued to current fair value at the date of exercise with the offsetting amount reported in our Consolidated Statements of Comprehensive Loss.

Changes in the number and value of our Original and New Warrants were as follows:

Amendment to the Purchase Agreement and Senior Notes

In connection with the Credit Agreement, the Investor entered into a Subordination Agreement, dated July 2, 2025 (the “Subordination Agreement”). Pursuant to the Subordination Agreement, the Investor agreed to the subordination of all indebtedness owed by the Company to the Investor, including under the Senior Notes issued by the Company to the Investor on December 4, 2024, to the indebtedness and obligations owed under the Credit Agreement and the other applicable loan documents.

Also, in connection with the Credit Agreement and the Subordination Agreement, the Company and Investor entered into an Amended and Restated Promissory Note, dated July 2, 2025 (the “A&R Promissory Note”). The A&R Promissory Note amends and restates the original Senior Notes to remove the seniority terms of those notes, conform the original Senior Notes to the terms of the Credit Agreement and the Subordination Agreement, amend certain prepayment and make-whole terms under the original Senior Notes, delete certain covenants and event of default terms, reduce the interest rate under the original Senior Notes to 5% per annum paid in cash and 7% per annum paid in kind, both on the final business day of June and December in each year, and to delete the financial covenants set forth in the original Senior Notes. As a result of an amendment to the Purchase Agreement entered into on July 2, 2025 (the "Purchase Agreement Amendment"), among other things, the Investor agreed to release all liens and guarantees securing the obligations under the Senior Notes, the Purchase Agreement, and the A&R Promissory Note. The A&R Promissory Note also (i) provides for additional interest to be capitalized and added to the principal amount of the debt at a rate of 5% per annum upon the occurrence and continuation of certain events of default and (ii) matures on January 2, 2030.

Included as a portion of the aggregate number of New Warrants described above, the Investor received 1,417,945 New Warrants on July 2, 2025, attributable to the Investor's agreements under the A&R Promissory Note, the Subordination Agreement, and the Purchase Agreement Amendment.

In accordance with Accounting Standards Codification 470-50, Modifications and Extinguishment, we evaluated the present value of future estimated cash flows of the Senior Notes immediately prior to the amendments described above and the present value of future estimated cash flows under the A&R Promissory Note, inclusive of the fair value of the New Warrants issued to the Investor as described above, and determined that extinguishment accounting was required with respect to the Senior Notes. This resulted in a non-cash charge of$0.2 million for the twelve months ended December 31, 2025, reflected as a "Loss on extinguishment of debt" in the accompanying Condensed Consolidated Statements of Comprehensive Loss due to the required write off of the remaining unamortized debt discount and debt issue costs of the Senior Notes in connection with the amendments described above and the estimated fair value of the A&R Promissory Note of approximately $4.4 million that was determined primarily using Level 2 inputs associated with the fair value of other third party debt issued contemporaneously with the amendment of this debt, as well as market spreads between secured and subordinated debt.

Interest

Total interest expense recognized during the years ended December 31, 2025 and 2024, was$8.2 million and$0.7 million, respectively. The effective interest rate for our long-term debt, including amortization of the discount and deferred loan costs, is approximately 29%.

Note 15. Commit ments and contingencies

We may become involved in various claims, lawsuits, investigations, and other proceedings arising in the normal course of business. We accrue a liability when information available prior to the issuance of financial statements indicates it is probable a loss has been incurred as of the date of the financial statements and the amount of loss can be reasonably estimated. If the reasonable estimate of the probable loss is a range, we record an accrual for the most likely estimate of the loss, or the low end of the range if there is not one best estimate. We adjust our accruals to reflect the impact of negotiation, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. Legal costs are expensed as incurred.

United States Customs and Border Protection assessment

In March of 2023, United States Customs and Border Protection ("CBP") issued notices of tariff assessment that indicated an action taken at the Import Specialist (i.e., the port) level with respect to merchandise imported from Thailand under entry number 004-1058562-5 (the “625 Assessment”) and entry number 004-1063793-9 (the “Original 939 Assessment”, and collectively with the 625 Assessment, the “Original CBP Assessments”). The Original CBP Assessments related to certain torque beams that are used in our Voyager+ product that were imported in 2022. In the Original CBP Assessments, CBP asserted that Section 301 China tariffs, Section 232 steel and aluminum tariffs, and antidumping and countervailing duties applied to the merchandise. Based on correspondence received to date from CBP, including a recent partial acceptance by CBP of our protest on the 625 Assessment as described below, and our calculations based on applicable duty and tariff rates, the 625 Assessment is currently estimated at approximately $0.07 million. In September of 2023, CBP informed us that the amount owed under the Original 939 Assessment was being revised downward to approximately $2.01 million (the "Revised 939 Assessment", and together with the 625 Assessment, the"Revised CBP Assessments"). In particular, CBP accepted our position that the Section 301 tariffs of 25% or 7.5% of the value of the merchandise, depending on tariff classification, as well as the antidumping and countervailing duties, previously assessed under the Original 939 Assessment are not applicable as they are only applicable to articles that are products of China and that, in this case, the finished goods are products of Thailand.

CBP has legally finalized both Revised CBP Assessments. We filed a formal protest for the 625 Assessment in September of 2023 and for the Revised 939 Assessment in March of 2024. On February 11, 2026, CBP partially approved our protest of the 625 Assessment, which reduced our estimated exposure down to $0.07 million. We were notified on March 18, 2026, that CBP had denied our protest of the Revised 939 Assessment. Based on the denial by CBP, we accrued approximately $2.7 million, inclusive of interest, in our consolidated financial results for the year ended December 31, 2025 and expect to pay that amount to CBP, as required. We are currently evaluating our options to challenge this decision by CBP in the U.S. Court of International Trade (the "Court") as to the merits of the disputed tariff classifications. However, because matters of this nature are subject to inherent uncertainties, and unfavorable rulings or developments, including future assessments of additional duties or tariffs owed in respect of other shipments or other materials beyond what is presently included in the Revised CBP Assessments, there can be no certainty that the Company might ultimately prevail in the Court and we could also be subject to future assessments of additional duties or tariffs owed in respect of other shipments or other materials beyond what is presently included in the Revised CBP Assessments, or incur charges that are not currently recorded as liabilities which could have a material adverse effect on our consolidated results of operations, financial position, or liquidity

Customer litigation

On June 11, 2025, FTC Solar, Inc. filed a lawsuit against BayWa r.e. Power Solutions, Inc. ("BayWa") in the United States District Court for the Western District of Texas (Civil Action No. 25-cv-00905-DAE). The complaint alleges breach of contract arising from BayWa’s purported cancellation of a large equipment supply agreement and purchase order for custom solar tracking systems intended for a Texas-based solar energy project. The parties engaged in a formal dispute resolution process, including pre-suit mediation without success. On August 25, 2025, BayWa filed an answer to FTC's complaint and asserted certain counterclaims against FTC. On September 15, 2025, FTC filed a response to BayWa's counterclaims. The parties are now engaged in discovery. While FTC believes it has meritorious claims and intends to vigorously pursue recovery, the outcome of litigation is inherently uncertain, and it is unclear at this time whether FTC or BayWa will recover the amounts sought in their respective claims or whether the outcome would materially affect FTC's financial condition or results of operations.

Note 16. Stoc kholders' equity

Preferred stock

Our certificate of incorporation, as amended on April 28, 2021, June 8, 2021, and November 29, 2024 (the "Certificate of Incorporation"), authorizes the Company to issue up to 10 million shares of preferred stock with a par value of $0.0001 with such designation, rights and preferences as may be determined from time to time by the Company’s board of directors. As of December 31, 2025, there were no shares of preferred stock issued or outstanding.

Common stock

The Certificate of Incorporation authorizes the Company to issue 850 million shares of $0.0001 par value of common stock. Holders of our common stock are entitled to dividends, as and when declared by the board of directors, subject to the rights of the holders of all classes of stock outstanding having priority rights as to dividends. There have beenno dividends declared to date. The holders of our common stock are entitled to one vote for each share of common stock; provided that, except as otherwise required by law, holders of our common stock (in such capacity) shall not be entitled to vote on any amendment to the Certificate of Incorporation that relates solely to the terms of one or more outstanding series of preferred stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to the Certificate of Incorporation.

Treasury stock

On July 21, 2020, the Company’s board of directors approved the acquisition of 989,667 shares (on a post-split basis) of common stock for an aggregate price of $0 from founders of the Company. The acquisition of these shares was recorded as treasury stock on the Company’s Consolidated Balance Sheet, and the shares were added to the overall pool of stock available to be utilized for future option/stock award issuances to other employees of the organization.

On January 8, 2021, the Company’s board of directors approved the acquisition of 14,844 shares (on a post-split basis) of common stock for an aggregate price of $0 from founders of the Company. The acquisition of these shares was recorded as treasury stock on the Company’s Consolidated Balance Sheet, and the shares were added to the overall pool of stock available to be utilized for future option/stock award issuances to other employees of the organization.

On April 5, 2021, the Company’s board of directors approved the acquisition of 71,746 shares (on a post-split basis) of common stock for an aggregate price of $0 from founders of the Company. The acquisition of these shares was recorded as treasury stock on the Company’s Consolidated Balance Sheet, and the shares were added to the overall pool of stock available to be utilized for future option/stock award issuances to other employees of the organization.

Reverse stock split

On November 29, 2024, we effected a 1-for-10 reverse stock split of our outstanding common stock (the "Reverse Stock Split"). The Reverse Stock Split did not impact the par value of our common stock or the authorized number of shares of our common stock. We have reflected the retroactive comparative impact of the Reverse Stock Split on (i) the activity in the number of common and treasury shares prior to the Reverse Stock Split in our Consolidated Statements of Changes in Stockholders' Equity (Deficit), and (ii) the full year 2024 net loss per share based on the weighted average number of shares outstanding prior to the Reverse Stock Split in our Consolidated Statements of Comprehensive Loss.

Note 17. ATM program

On May 16, 2025, we filed an amendment to replace an existing Form S-3 shelf registration statement relating to (a) the issuance and sale from time to time in one or more transactions, of up to $65 million in aggregate of our common stock, preferred stock, debt securities and warrants and (b) an at the market offering prospectus covering the offering, issuance and sale of up to a maximum aggregate offering price of approximately $13.75 million of our common stock that may be sold under the applicable Sale Agreement described below in at the market offerings.

On May 1, 2025, we entered into the Sale Agreement with H.C. Wainwright & Co. LLC relating to the sale from time to time of shares of our common stock in accordance with the terms of the Sale Agreement having an aggregate offering price that does not exceed the number or dollar amount of shares of common stock that we may register from time to time for the ATM program, or approximately $13.75 million.

Sales of newly issued shares of our common stock under the ATM program were as follows:

We utilize the net proceeds from offerings under the ATM program for general corporate purposes, including working capital and operating expenses. We may also use a portion of such proceeds to acquire or invest in businesses, products, services or technologies. There can be no assurance regarding the price at which we will be able to sell such shares in the future, whether under the ATM program or other securities offerings, and any sales of our common stock under the ATM program or other securities offerings may be at prices that result in additional dilution to our existing stockholders.

At December 31, 2025, approximately$9.0 million remained available for sale under the existing Sale Agreement and prospectus for the ATM program.

Note 18. Stock compensation and other employee benefit plans

Stock compensation plans

2017 Plan

On January 9, 2017, the Company’s board of directors adopted the 2017 Stock Incentive Plan (the “2017 Plan”). The Plan offered employees, directors and selected service providers the opportunity to acquire equity in the Company through grants of options, restricted stock awards, stock appreciation rights, restricted stock units (“RSUs”), and other stock awards, at exercise prices, if applicable, not less than the fair market value of the Company's common stock on the date of grant.

On July 1, 2022, we filed a registration statement on Form S-8 to register 500,000 (on a post-split basis) shares of common stock for issuance upon the settlement of RSUs and the exercise of stock options previously granted under the 2017 Plan that remain outstanding. Since April 27, 2021, no new awards have been or will be granted under the 2017 Plan.

2021 Plan

Our 2021 Stock Incentive Plan (the "2021 Plan"), which was adopted by our Board of Directors and approved by our stockholders on April 16, 2021, and became effective on April 27, 2021, provides for the grant of awards similar to the 2017 Plan, as well as stock bonuses and cash awards. The number of shares initially reserved for issuance under the 2021 Plan was 1,264,524 (on a post-split basis), which automatically increases on January 1 of each calendar year prior to the tenth anniversary of the Plan's effective date in an amount equal to the lesser of (i)4% of the total number of shares of common stock outstanding on the day prior (December 31st), and (ii) a number of shares of common stock determined by the compensation committee of the Company's board of directors.

In addition, on September 19, 2025, we filed a registration statement on Form S-8 to register an additional 2,000,000 shares of our common stock issuable under the 2021 Plan. The additional shares were approved during a Special Meeting of Stockholders held on September 4, 2025.

Through December 31, 2025, an additional 1,806,544 shares (on a post-split basis) became available for issuance pursuant to the automatic increase provisions of the 2021 Plan and the additional shares approved by stockholders, as described above, resulting in a total number of shares authorized for issuance under the 2021 Plan of 5,071,068 (on a post-split basis).

Employment Inducement Awards

On August 16, 2024, we filed a registration statement on Form S-8 to register an additional 650,000 shares (on a post-split basis) of common stock for issuance upon the vesting and settlement of time-based RSUs, in accordance with the terms of the Restricted Stock Unit Inducement Award Agreement, by and between the Company and Yann Brandt and the vesting and settlement of performance-based RSUs, in accordance with the terms of the Share Target Restricted Stock Unit Inducement Award Agreement by and between the Company and Yann Brandt (collectively, the "Employment Inducement Awards"). The Employment Inducement Awards were granted effective August 19, 2024, in connection with Mr. Brandt's commencement of employment as our President and Chief Executive Officer.

2021 ESPP Plan

Concurrent with the adoption of the 2021 Plan, we also adopted the 2021 Employee Stock Purchase Plan (the "2021 ESPP Plan") in order to provide employees of the Company and its designated subsidiaries with an opportunity to purchase the Company's common stock through accumulated payroll deductions at 85% of the stock's fair market value. As of December 31, 2025, this plan has not yet been implemented internally within the Company, andno purchases of common stock have been made pursuant to the 2021 ESPP Plan.

Information on outstanding awards

Stock options generally vest betweentwo andfour years from the date of grant, and, for those remaining outstanding as of December 31, 2025, have only service-based vesting conditions.

RSU grants may contain either (i) service-based vesting conditions or (ii) a combination of market or performance and service-based vesting conditions, which must be met in order to vest. Awards with service-based vesting conditions generally vest over a period ofthreeto four years from the date of grant. Awards with market or performance-based vesting conditions will generally vest upon achievement of the related targets, providing the employee continues to be employed at the date of vesting. Performance conditions in certain of our outstanding awards are based on the recipient achieving specified sales metrics whereas, market conditions in certain outstanding awards are based on the closing price of our common stock achieving specified levels for a period of time.

Generally, new shares of authorized common stock are issued to satisfy vesting or exercise of outstanding awards under both the 2017 and 2021 Stock Incentive Plans, although treasury shares are also available for issuance at our discretion.

Stock compensation expense for each period was as follows:

Information relating to our outstanding option awards was as follows:

Assumptions used to value option awards were as follows:

Information relating to our outstanding restricted stock unit awards was as follows:

The weighted average grant date fair value of RSUs granted during the year ended December 31, 2024 was$2.62 per RSU (on a post-split basis). The total fair value of RSUs vested was approximately$3.8 million and$8.8 million during the years ended December 31, 2025 and 2024, respectively.

Other employee benefit plans

We sponsor a 401(k) savings plan for our U.S. employees, whereby the employees can elect to make pre- or post-tax contributions, subject to certain limitations. We make matching contributions equal to 100% of the first 3% and 50% of the next 2% of an employee's contribution. Employee and company contributions are both immediately vested. Company matching contributions were approximately$0.4 million and$0.5 million for the years ending December 31, 2025 and 2024, respectively.

Employees are also eligible to participate in various employee welfare benefit plans, including medical, dental, vision, prescription and life insurance, in which the Company pays a portion of the cost. All such plans are unfunded.

Note 19. Related party transactions

Alpha Steel

As described further in Note 11, "Equity method investment" above, we acquired 100% of the Membership Interests in Alpha Steel, effective November 12, 2025, and now consolidate the operations of Alpha Steel in our consolidated financial statements as of December 31, 2025 and for the period from November 13, 2025 to December 31, 2025. Prior to that, we accounted for our 45% interest in Alpha Steel under the equity method of accounting, during which time Alpha Steel was considered a related party.

We had$3.1 million of related party receivables from Alpha Steel at December 31, 2024 for future material cost discounts contractually owed to us in connection with the expected receipt of manufacturing cost reductions due to incentives available to Alpha Steel under the IRA as costs are incurred by Alpha Steel to purchase raw materials and manufacture torque tubes and other products that will be used to fulfill purchase orders we issue to Alpha Steel.

At December 31, 2024, we also had related party liabilities to Alpha Steel totaling$1.7 million for the accrued cost of revenue recognized on certain of our customer projects associated with the cost of products that were being manufactured for us by Alpha Steel. Amounts included in our accounts payable balance at December 31, 2024 relating to Alpha Steel totaled $0.5 million.

During the period January 1, 2025 to November 12, 2025, we received invoices from Alpha Steel for purchases totaling$16.1 million and made total deposits of$0.3 million to Alpha Steel. For the year ended December 31, 2024, we received invoices from Alpha Steel for purchases totaling $7.5 million and made total deposits of $2.8 millionto

Alpha Steel, of which $2.0 million remained in our balance of related party vendor deposits at December 31, 2024, as shown in Note 7 "Prepaid and other current assets" above.

Other

As described in Note 14, "Debt", above, a member of our Board of Directors, Pablo Barahona, invested $500,000 in the entity that purchased$15.0 million of initial principal amount of our Senior Notes in December 2024. As a result of the exercise during 2025 of the Original Warrants issued in connection with the offering of Senior Notes, Mr. Barahona became the beneficial owner of 58,333 shares of our common stock issued in settlement of the warrant exercise.

Note 20. Net loss per share

For purposes of computing diluted loss per share, weighted average common shares outstanding do not include potentially dilutive securities, including warrants, which are anti-dilutive, as shown below.

Holders of the Warrants are not entitled to vote or receive dividends or be deemed to have the rights of a stockholder of the Company. Accordingly, the losses of the Company reflected above are attributed entirely to common stockholders.

Note 21. Fair value measurements

Certain of our cash equivalents include deposits in money market funds that invest primarily in short-term securities issued or guaranteed by the U.S. government or its agencies or instrumentalities and contain no restrictions on immediate redemption. The carrying value for money market fund deposits approximates fair value based on quoted prices in active markets for units held (Level 1 classification), and totaled$0.5 million at December 31, 2025 and$0.5 million at December 31, 2024.

At December 31, 2025 and 2024, we estimated the fair value of our outstanding warrants to be approximately$74.5 million and$9.5 million, respectively, utilizing a Black-Scholes model (Level 2 measurement). The estimated fair value of our warrants is primarily impacted by the closing price of our common stock on Nasdaq at each period end. Other assumptions used, as shown below, have a significantly lesser impact on the fair value of our warrants.

We estimate the carrying value of our Acquisition Notes, as shown in our Consolidated Balance Sheet, approximates fair value at December 31, 2025 due to their recent issuance and short-term nature.

We estimate the fair value of our Term Loans, based primarily on Level 2 inputs involving credit spreads on similar debt and other market participant factors involving observed secured and unsecured recovery rates, to be approximately$16.5 million at December 31, 2025. At December 31, 2024, we estimated the fair value of our long-term debt approximated carrying value due to its then-recent issuance.

We didnot hold any other financial instruments measured at fair value on a recurring basis as categorized within the fair value hierarchy at December 31, 2025 and 2024.

Note 22. Sale of investment in unconsolidated subsidiary

On June 24, 2021, we disposed of our 23% equity interest in Dimension.

The sales agreement with Dimension included an earnout provision which provided for the potential to receive additional contingent consideration earned through December 2024, based on Dimension achieving certain performance milestones. The sales agreement also included additional contingent consideration in the form of a projects escrow release based on Dimension’s completion of certain construction projects in progress at the time of the sale.

During the years ended December 31, 2025 and 2024, we received$3.2 million and$8.8 million, respectively, from final payments earned through December 31, 2024. In accordance with our accounting policy, we recognized the gain from these payments upon realization.

Note 23. Segment information and certain concentrations

Segment-related disclosures

We currently operate inone business segment, the manufacturing and servicing of solar tracker systems. We consider our segment results to be the same as our consolidated results and our segment accounting policies to be the same as those described in Note 2, "Summary of significant accounting policies".

We report our revenue based on the products and services we provide. Product revenue is derived from the sale of solar tracker systems and customized components for those systems, individual part sales for certain specific transactions and the sale of term-based software licenses. Service revenue includes revenue from shipping and handling services, engineering consulting and pile testing services, our subscription-based enterprise licensing model and maintenance and support services in connection with the term-based software licenses.

Our President and Chief Executive Officer is considered our chief operating decision maker ("CODM"). Our CODM uses consolidated net income (loss) to allocate resources, monitor budget versus actual results, evaluate our return on assets and manage our overall cost structure, as well as to assess our performance against our competitors.

Based on certain significant period cost information regularly provided to our CODM, following is a reconciliation including such costs to our consolidated net loss:

Geographic concentrations

Third-party revenue was recognized by our subsidiaries established in the following locations:

Our long-lived assets, consisting of ROU assets and property and equipment, were in the following locations:

Cash and cash equivalents concentration

At December 31, 2025, approximately 93% of our cash and cash equivalents were in financial institutions located in the United States. Certain of our cash equivalents include deposits in money market funds that invest primarily in short-term securities issued or guaranteed by the U.S. government or its agencies or instrumentalities and contain no restrictions on immediate redemption. These deposits totaled$0.5 million at December 31, 2025 and$0.5 million at December 31, 2024.

Customer concentration

During the year ended December 31, 2025, four customers accounted for approximately 28%,20%,18% and 12%, respectively, of total revenue. During the year ended December 31, 2024, four customers accounted for approximately 39%,11%,11% and 11%, respectively, of total revenue.

Note 24. Subsequent events

On March 23, 2026, we entered into the Second Amendment pursuant to which: (i) the Lenders provided a waiver relating to our breach of the purchase order covenant for the fiscal quarter ended December 31, 2025; (ii) the Lenders agreed that a purchase order covenant will not apply to us until the fiscal quarter ending March 31, 2027; and (iii) we and the Lenders agreed to further amend the financial covenants under the Credit Agreement. Additionally, pursuant to the Second Amendment, we agreed to repay a portion of the principal amount of the loans outstanding under the Credit Agreement as follows: (x) on the date of the Second Amendment, we repaid $2.5 million of principal and; (y) we are required to repay an additional $2.5 million of principal on May 22, 2026; and (z) $5.0 million of principal on September 30, 2026.

We were notified on March 18, 2026, that CBP had denied our protest of the Revised 939 Assessment. See further discussion in Note 15, "Commitments and contingencies" above.