SPRUCE POWER HOLDING CORP

Note 1. Organization and Description of Business

Description of Business

Spruce Power Holding Corporation and its subsidiaries (“Spruce Power” or the “Company”) is a leading owner and operator of distributed solar energy assets across the U.S., offering subscription-based services to approximately 85,000 home solar assets and customer contracts, making renewable energy more accessible to everyone. The Company is engaged in the ownership and maintenance of home solar energy systems for homeowners in the U.S.

The Company’s primary customers are homeowners and its core solar service offerings to these customers generate revenues primarily through (i) the sale of electricity generated by its home solar energy systems to homeowners pursuant to long-term Customer Agreements as defined below, which require the homeowners to make recurring monthly payments, (ii) third-party contracts to sell solar renewable energy credits (“SRECs”) generated by the Company’s home solar energy systems for contracted prices, and (iii) the servicing of third-party owned solar energy systems through the Company’s Spruce Pro servicing platform, which is contracted to offer portfolio managed services to third-party owners, as well as to the Company’s portfolio of home solar energy systems (the “Portfolio”). These portfolio managed services include (a) billing and collections/asset recovery, (b) account support services, (c) financial asset management, (d) homeowner support and servicing technology, (e) asset operations, and (f) transaction and execution services related to SRECs.

In addition to the Company’s core solar service offerings, the Company generates cash flows and earns interest income from customer contracts related to a master lease agreement, which is referred to in this Quarterly Report on Form 10-Q as the “SEMTH Master Lease”. The Company also holds subsidiary fund companies that own and operate the Company’s portfolio of home solar energy systems, which are subject to solar lease agreements (“SLAs”) and power purchase agreements (“PPAs”, together with the SLAs, “Customer Agreements”) with residential customers who benefit from the production of electricity generated by the Company’s Portfolio, which may qualify for subsidies, renewable energy credits and other incentives as provided by various states and local agencies. These benefits have generally been retained by the Company's subsidiaries that own the systems, with the exception of the investment tax credit (“ITCs”) under Section 48 of the Internal Revenue Code, as amended (the “IRC”), which were generally passed through to the various financing partners of the solar energy systems.

Historically, the Company provided fleet electrification solutions for commercial vehicles in North America, offering its systems for vehicle electrification (the “Drivetrain” business) and offering and installing charging stations to enable customers to develop charging infrastructure required for electrified vehicles (the “XL Grid” business). The Company ceased the Drivetrain and XL Grid operations in late 2022, and both are presented as discontinued operations in the unaudited condensed consolidated financial statements (see Note 14. Discontinued Operations).

Liquidity

These consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) assuming the Company will continue as a going concern.

The Company’s debt obligations under the SP1 Facility are non-recourse to the Company (see Note 7. Non-Recourse Debt) and have a maturity date of April 30, 2026 (the “SP1 Maturity Date”). Because (i) the SP1 Maturity Date is within twelve months from the date these unaudited condensed consolidated financial statements are issued, (ii) the Company has not yet entered into a commitment to refinance the SP1 Facility although the maturity date is in April 2026, (iii) the Company has determined that it is unlikely to have sufficient cash on hand or proceeds from currently available liquidity sources to satisfy the SP1 Facility at the SP1 Maturity Date, (iv) the Company had negative working capital of $121.7 million as of September 30, 2025 solely due to the current maturity of the SP1 Facility at that date, and (v) the Company has experienced recurring net losses and negative cash flows from operations for the nine months ended September 30, 2025, these conditions raise substantial doubt about the Company’s ability to continue as a going concern.

Notes to Unaudited Condensed Consolidated Financial Statements

The Company plans to refinance the SP1 facility prior to the SP1 Maturity Date consistent with the Company’s historical financing strategy for investing in solar assets on a leveraged basis. The Company has obtained term sheets from potential lenders and placement agents, which are currently being reviewed by management and the board of directors. The Company’s management believes that such refinancing will be completed prior to the SP1 Maturity Date and that any such substantial doubt is alleviated by managements plans. Should the Company be unsuccessful in refinancing the SP1 facility, this could result in a foreclosure of collateral and negatively impact operations. Further, an event of default on the SP1 facility, if not cured in the permittable time allowed under the agreement, would result in a cross default on the Second KeyBank Credit Agreement, which is non-recourse.

Note 2. Summary of Significant Accounting Policies

Basis of unaudited condensed consolidated financial statement presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) for interim financial information and Article 8 of Regulation S-X. The accompanying unaudited condensed consolidated balance sheet as of December 31, 2024 has been derived from the Company’s audited consolidated financial statements included in the Annual Report. The Company has condensed or omitted certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. As such, these interim unaudited condensed consolidated financial statements should be read in conjunction with the Company’s annual audited consolidated financial statements and accompanying notes included in its Annual Report.

The Company’s interim unaudited condensed consolidated financial statements reflect all normal and recurring adjustments and material adjustments for nonrecurring transactions and events necessary, in its opinion, to state fairly the financial position and results of operations for the reported periods. Amounts reported for interim periods may not be indicative of a full year period due to the Company’s continual growth, seasonal fluctuations in demand for power, timing of maintenance and other expenditures, changes in interest expense and other factors.

The Company's accompanying unaudited condensed consolidated financial statements include the accounts of its wholly owned subsidiaries andtwo controlled variable interest entities (“VIEs”), for which the Company is the primary beneficiary. All intercompany transactions and balances have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the Company’s presentation as of and for the quarter ended September 30, 2025, and such reclassifications had no effect on the Company’s previously reported financial position, results of operations, or cash flows.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the balance sheet date, as well as reported amounts of income and expenses during the reporting period. The Company’s most significant estimates and judgments involve (i) valuation allowance on deferred income taxes, (ii) warranty reserves, (iii) valuation of stock-based compensation, (iv) the useful lives of certain assets and liabilities, including property and equipment, and intangible assets, (v) the allowance for credit losses, (vi) asset retirement obligations, (vii) valuation of business combinations, including the fair values and useful lives of acquired assets and assumed liabilities, and the fair value of asset acquisitions, (viii) the fair value estimates of long-lived assets in impairment analysis, (viiii) valuation models used in determining future principal debt amortization on certain credit facilities, and (vix) future cash flows for the SEMTH master lease agreement. Management bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates, and such differences could be material to the Company’s financial statements.

Notes to Unaudited Condensed Consolidated Financial Statements

Variable interest entities

The Company consolidates any VIE of which it is the primary beneficiary. The Company formed or acquired VIEs which are partially funded by tax equity investors in order to facilitate the funding and monetization of certain attributes associated with solar energy systems. The typical condition for a controlling financial interest ownership is holding a majority of the voting interests of an entity; however, a controlling financial interest may also exist in entities, such as VIEs, through arrangements that do not involve controlling voting interests. A variable interest holder is required to consolidate a VIE if that party has the power to direct the activities of the VIE that most significantly impact the VIE's economic performance and the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company does not consolidate a VIE in which it has a majority ownership interest when the Company is not considered the primary beneficiary. The Company evaluates its relationships with the VIEs on an ongoing basis to determine if it is the primary beneficiary. The Company’s initial investments in Volta Solar Owner II, LLC and ORE F4 HoldCo, LLC (collectively, the “Funds”) were determined to be variable interests in VIEs and remained as such as of September 30, 2025 and December 31, 2024. See Note 11. Consolidated VIEs and Noncontrolling Interests. The Company considered the provisions within the contractual arrangements that grant it power to manage and make decisions that affect the operation of the VIEs, and the operation and maintenance of the solar energy systems. The Company considers the rights granted to the other investors under the contractual arrangements to be more protective in nature rather than substantive participating rights. As such, the Company was determined to be the primary beneficiary and the assets, liabilities and activities of the Funds were consolidated by the Company.

Cash and cash equivalents

The Company considers all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents include cash held in banks, money market accounts and U.S. Treasury securities. Cash equivalents are carried at cost, which approximates fair value due to their short-term nature. The Company’s cash and cash equivalents are placed with large financial institutions, and at times exceed federally insured limits. To date, the Company has not experienced any credit loss relating to its cash and cash equivalents.

Concentration of credit risks and revenue

Financial instruments which potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, and accounts receivable, net (discussed below). At times, the Company may hold cash balances at a single bank in excess of the Federal Deposit Insurance Corporation deposit insurance limit of $250,000. At September 30, 2025 and December 31, 2024, the Company had cash in excess of the federal deposit insurance limit. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents as most of the balances are invested in money market accounts.

For the three and nine months ended September 30, 2025, the Company hadone customer that represented 17% and 14% , respectively, of the Company’s revenues. For the three and nine months ended September 30, 2024, the Company had no customers that represented at least 10% of the Company’s revenues.

As of September 30, 2025 and December 31, 2024, the Company hadone customer that represented 29% andno customers, respectively, that represented at least 10% of the Company’s accounts receivable.

Restricted cash

Restricted cash held at September 30, 2025 and December 31, 2024 of $45.1 million and $36.3 million, respectively, primarily consists of cash that is subject to restriction due to provisions in the Company's financing agreements and the operating agreements of subsidiary fund companies. The carrying amount reported in the unaudited condensed consolidated balance sheets for restricted cash approximates its fair value.

The following table provides a reconciliation of cash and cash equivalents and restricted cash to the total amounts shown within the unaudited condensed consolidated statements of cash flows for each period ended:

Notes to Unaudited Condensed Consolidated Financial Statements

Accounts receivable, net

Accounts receivable, net primarily represent amounts due from the Company’s customers. Accounts receivable is recorded net of allowance for credit losses, which is determined by the Company’s assessment of the collectability of customer accounts based on the best available data at the time of the assessment. Management reviews the allowance for credit losses by considering factors such as historical experience, contractual term, aging category and current and forecasted economic conditions that may affect customers. The following table presents the changes in the allowance for credit losses recorded against accounts receivable, net on the unaudited condensed consolidated balance sheets:

Notes to Unaudited Condensed Consolidated Financial Statements

Investment related to SEMTH master lease agreement and interest income

The Company accounts for its investment related to the SEMTH, as defined below, master lease agreement in accordance with Accounting Standards Codification (“ASC”) 325-40, Investments—Other—Beneficial Interests in Securitized Financial Assets. The Company recognizes accretable yield as interest income over the life of the related beneficial interest using the effective yield method, which is reflected within interest income in the unaudited condensed consolidated statements of operations in the amount of $4.5 million and $13.5 million for the three and nine months ended September 30, 2025, and $4.8 million and $12.3 million for the three and nine months ended September 30, 2024, respectively. On a recurring basis, the Company evaluates changes in the cash flows expected to be collected from the cash flows previously projected, and when favorable or adverse changes are identified, the Company prospectively updates its expectation of cash flows to be collected and recalculates the amount of accretable yield for the related beneficial interest.

Favorable or adverse changes deemed other than temporary are accounted for as a change in estimate in conformity with ASC 250, Accounting Changes and Error Corrections, with the amount of periodic accretion adjusted over the remaining life of the master lease agreement. During the three and nine months ended September 30, 2025, the Company had no revisions to its estimated cash flows expected to be collected related to the SEMTH master lease agreement, and as a result, recognizedno additional accretable yield within interest income in the unaudited condensed consolidated statements of operations.

Impairment of long-lived assets

The Company reviews long-lived assets, such as property and equipment and intangible assets with definite lives, for impairment whenever events or changes in circumstances indicate that an asset group’s carrying amount may not be recoverable. The Company groups assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluates the asset group against the sum of the undiscounted future cash flows. If the undiscounted cash flows do not indicate the carrying amount of the asset group is recoverable, an impairment charge is measured as the amount by which the carrying amount of the asset group exceeds its fair value. There wereno long-lived asset impairment charges recognized during the three and nine months ended September 30, 2025 and 2024.

Contingencies

When it is probable that a loss has occurred and the loss amount can be reasonably estimated, the Company records liabilities for loss contingencies. In certain cases, the Company may be covered by one or more corporate insurance policies, resulting in insurance loss recoveries. The Company records proceeds up to the amount of the loss recognized as receivable when realization of the claim for recovery is determined to be probable. When such recoveries are in excess of a loss recognized in the Company’s financial statements, the Company recognizes a gain contingency at the earlier of when the gain has been realized or when it is realizable.

Fair value measurements

The fair value of the Company’s financial assets and liabilities reflects Management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect the Company’s assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, the Company classifies each fair value measurement as follows:

•Level 1: Observable inputs that reflect unadjusted quoted market prices in active markets for identical assets or liabilities that are accessible at the measurement date.

Notes to Unaudited Condensed Consolidated Financial Statements

•Level 2: Observable inputs other than Level 1 prices, such as quoted market prices for similar assets or liabilities in active markets, quoted market prices 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 assets or liabilities.

•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.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy must be determined based on the lowest level input that is significant to the fair value measurement. An assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to the asset or liability.

The Company’s financial instruments consist of cash and cash equivalents, restricted cash, accounts receivable, net, accounts payable, non-recourse debt, and interest rate swaps. The carrying value of cash and cash equivalents, restricted cash, accounts receivable, and accounts payable approximates fair value due to the short-term nature of those instruments. See Note 9. Fair Value Measurements for additional information on assets and liabilities measured at fair value.

The Company’s revenue is derived from its home solar energy portfolio and servicing platform, which primarily generates revenue through the sale to homeowners of power generated by home solar energy systems pursuant to long-term agreements. Pursuant to ASC 606, Revenue from Contracts with Customers(“ASC 606”), issued by the Financial Accounting Standards Board (“FASB”), the Company has elected the “right to invoice” practical expedient for energy generation and servicing revenues, and revenues for the performance obligations related to energy generation and servicing revenue are recognized as services are rendered based upon the underlying contractual arrangements.

The following table presents the detail of the Company’s revenues as reflected within the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024:

Energy generation

Customers purchase solar energy from the Company under PPAs or SLAs, both defined above. Revenue is recognized from contracts with customers as performance obligations are satisfied at a transaction price reflecting an amount of consideration based upon an estimated rate of return which is expressed as the solar rate per kilowatt hour or a flat rate per month as defined in the customer contracts.

•PPA revenues-Under ASC 606, PPA revenue is recognized when generated based upon the amount of electricity delivered as determined by remote monitoring equipment at solar rates specified under the PPAs.

Notes to Unaudited Condensed Consolidated Financial Statements

•SLA revenues -The Company has SLAs, which do not meet the definition of a lease under ASC 842, Leases, and are accounted for as contracts with customers under ASC 606. Revenue is recognized on a straight-line basis over the contract term as the obligation to provide continuous access to the solar energy system is satisfied. The amount of revenue recognized may not equal customer cash payments due to the performance obligation being satisfied ahead of cash receipt or evenly as continuous access to the solar energy system has been provided. The differences between revenue recognition and cash payments received are reflected as deferred rent assets on the unaudited condensed consolidated balance sheets. Certain SLAs contain provisions to provide customers a performance guarantee that each solar energy system will achieve certain specified minimum solar energy production output. If the solar energy system does not produce the guaranteed production amount, the Company is obligated to pay a performance guarantee calculated as the product of (a) the shortfall production amount and (b) guaranteed rate per kWh as defined in the SLA.

Solar renewable energy credit revenues

The Company enters into contracts with third parties to sell SRECs generated by the solar energy systems for fixed prices. Certain contracts that meet the definition of a derivative may be exempted as normal purchase or normal sales transactions (“NPNS”). NPNS are contracts that provide for the purchase or sale of something other than a financial instrument or derivative instrument that will be delivered in quantities expected to be used or sold over a reasonable period in the normal course of business. Certain SREC contracts meet these requirements and are designated as NPNS contracts. Such SRECs are exempted from the derivative accounting and reporting requirements, and the Company recognizes revenues in accordance with ASC 606 when the SRECs are transferred to the counterparty.

The Company recognizes revenues for SRECs based on pricing predetermined within the respective contracts at a point in time when the SRECs are transferred. As SRECs can be sold separate from the actual electricity generated by the renewable-based generation source, the Company accounts for the SRECs it generates from its solar energy systems as governmental incentives and does not consider those SRECs output of the underlying solar energy systems. The Company classifies these SRECs as inventory held until sold and delivered to third parties. As the Company uses the incremental cost method and did not incur any incremental costs beyond the costs of producing the related electricity to obtain these governmental incentives, the inventory carrying value for the SRECs was $0 as of September 30, 2025 and December 31, 2024.

Performance-based incentives

The Company participates in residential solar investment programs, which offer a performance-based incentive (“PBI”) for certain of its solar energy systems that are associated with the programs (“eligible systems”). PBIs are accounted for under ASC 606 and are earned based upon the actual electricity produced by the eligible systems.

Servicing revenues

The Company earns operating and maintenance revenue from third-party solar fund customers at pre-determined rates for various operating and maintenance and asset management services as specified in Maintenance Service Agreements (“MSAs”). The MSAs contain multiple performance obligations, including routine maintenance, nonroutine maintenance, renewable energy certificate management, inventory management, delinquent account collections and customer account management. Under ASC 606, the total transaction price is allocated to the identified performance obligation based on the relative standalone selling price, and the servicing revenues related to each performance obligation is recognized on a periodic basis over the term of the MSA.

Unfavorable solar renewable energy revenue agreements

The Company amortizes its unfavorable solar renewable energy agreements that have finite lives based on the pattern in which the economic benefit of the liability is relieved. The useful life of the Company’s liabilities generally range between three years andsix years. The useful life of these liabilities is assessed and assigned based on the facts and circumstances specific to the agreements acquired. The Company recognizes the amortization of unfavorable solar renewable energy agreements as revenues in the unaudited condensed consolidated statements of operations.

Notes to Unaudited Condensed Consolidated Financial Statements

Other revenue

Other revenue relates to revenue generating activities that do not fall into the Company’s primary revenue categories discussed above, including uniform commercial code revenues, other fees charged to the Company’s customers pursuant to the Company’s long-term Customer Agreements and servicing contracts, and other miscellaneous revenue and income.

Deferred revenue

Deferred revenue consists of amounts for which the criteria for revenue recognition have not yet been met and includes prepayments received for unfulfilled performance obligations that will be recognized on a straight-line basis over the remaining term of the respective customer agreements. Deferred revenue, in the aggregate, as of September 30, 2025 and December 31, 2024 was $4.9 million and $4.0 million, respectively.

During the three and nine months ended September 30, 2025, the Company recognized revenues of less than $0.1 million and approximately $0.2 million, respectively, related to deferred revenue as of December 31, 2024. During each of the three and nine months ended September 30, 2024, the Company recognized revenues of $0.1 million related to deferred revenue as of December 31, 2023.

Income taxes

The Company accounts for income taxes using the asset and liability method under which deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between financial statement carrying amounts and the tax basis of assets and liabilities and net operating loss and tax credit carryforwards. Deferred income taxes are provided for the temporary differences arising between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and net operating loss carry-forwards and credits. Deferred tax assets and liabilities are measured using enacted rates in effect for the year in which the differences are expected to be recovered or settled. The effect of changes in tax rates on deferred tax assets and liabilities is recognized in the unaudited condensed consolidated statements of operations in the period in which the enactment rate changes. The ultimate recovery of deferred tax assets is dependent upon the amount and timing of future taxable income and other factors, such as the taxing jurisdiction in which the asset is to be recovered. Deferred tax assets and liabilities are reduced through the establishment of a valuation allowance if, based on available evidence, it is more likely than not that the deferred tax assets will not be realized.

Uncertain tax positions taken or expected to be taken in a tax return are accounted for using the more likely than not threshold for financial statement recognition and measurement. The determination as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as consideration of the available facts and circumstances. As of September 30, 2025 and December 31, 2024, there were no uncertain tax positions taken or expected to be taken in the Company’s tax returns.

In the normal course of business, the Company is subject to regular audits by U.S. federal and state and local tax authorities. With few exceptions, the Company is no longer subject to federal, state or local tax examinations by tax authorities in its major jurisdictions for tax years prior to 2020. However, net operating loss carryforwards remain subject to examination to the extent they are carried forward and impact a year that is open to examination by tax authorities.

The Company did not recognize any tax related interest or penalties during the periods presented in the accompanying unaudited condensed consolidated financial statements, however, would record any such interest and penalties as a component of the provision for income taxes. There has historically been no federal or state provision for income taxes since the Company has historically incurred net operating losses and maintains a full valuation allowance against its net deferred tax assets. For the three and nine months ended September 30, 2025 and 2024, the Company recognizedno provision for income taxes, consistent with its losses incurred and the full valuation allowance against its deferred tax assets. As a result, the Company's effective income tax rate was 0% for the three and nine months ended September 30, 2025 and 2024.

Effective July 4, 2025, the New Tax Act was enacted. The New Tax Act extends the provisions of the 2017 Tax Cuts and Jobs Act and makes other changes to U.S. federal tax law. The Company has assessed the impact of the New Tax Act under ASC 740, Income Taxes, on its consolidated financial statements and does not expect a related material effect on its consolidated financial statements and income tax disclosures for interim and annual periods subsequent to July 4, 2025.

Notes to Unaudited Condensed Consolidated Financial Statements

Segment reporting

Segment reporting is based on the management approach, following the method that management organizes the Company’s operating segments for which separate financial information is made available to, and evaluated regularly by, the Company’s chief operating decision maker (“CODM”) in allocating resources and in assessing performance. The Company is organized and managed as a single operating and reportable segment, on a consolidated basis, which engages in the sole business of providing solar energy and related services to its customers, and as of September 30, 2025 and 2024, the Company hadone operating and reportable segment. See Note 15. Segment Information for further information.

Related parties

A party is considered to be related to the Company if the party directly or indirectly or through one or more intermediaries, controls, is controlled by, or is under common control with the Company. Related parties also include principal owners of the Company, its management, the board of directors, members of the immediate families of principal owners of the Company, its management, the board of directors and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. A party which can significantly influence the management or operating policies of the transacting parties or that has an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests is also a related party.

Notes to Unaudited Condensed Consolidated Financial Statements

Recent Accounting Pronouncements Adopted

In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvement to Reportable Segment Disclosures, (“ASU 2023-07”), which requires enhanced disclosures for reportable segments, primarily in relation to significant segment expenses, even in the event an entity has a single reportable segment in accordance with Topic 280. ASU 2023-07 was effective for the Company for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted this ASU as of December 31, 2024 and has retrospectively applied its requirements to all prior periods based on the significant segment expense categories identified and disclosed in its unaudited condensed consolidated financial statements in the period of adoption. See Note 15. Segment Information.

Recent Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires enhanced detailed disclosures about the types of expenses in commonly presented expense line items of entities. Subsequent to the issuance of ASU 2024-03, the FASB issued ASU 2025-01 of the same topic to clarify the effective date of ASU 2024-03, stating that all public entities are required to adopt the disclosure requirements in the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The Company plans to adopt this ASU in its annual financial statements for the year ending December 31, 2027 and in its interim financial statements in the subsequent year ending December 31, 2028, and is currently assessing the impact of this ASU on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, (“ASU 2023-09”), which introduces new disclosure requirements intended to enhance the transparency and decision-usefulness of income tax information. The amendments require public business entities to provide more detailed and consistently categorized information in the effective tax rate reconciliation, as well as disaggregated disclosures of income taxes paid by jurisdiction, where material. Given the nature and character of the Company’s tax payments and items that affect its effective tax rate, the Company is not expecting the adoption of this ASU to have a material effect on its income tax disclosures. ASU 2023-09 is effective for public business entities for annual periods beginning after December 15, 2024. The Company will adopt this ASU in its annual consolidated financial statements for the year ending December 31, 2025.

In July 2025, the FASB issued ASU 2025-05, Financial Instruments Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, (“ASU 2025-05”), to address challenges encountered by entities when estimating expected credit losses on current accounts receivable or current contract assets resulting from transactions accounted for under ASC 606. ASU 2025-05 introduces a practical expedient for entities which, if elected, assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is effective for annual reporting periods, including interim reporting periods within those annual reporting periods, beginning after December 15, 2025, with early adoption permitted. The Company evaluated the practical expedient and determined that it will not adopt the practical expedient in its annual consolidated financial statements for the year ending December 31, 2025.

Notes to Unaudited Condensed Consolidated Financial Statements

Note 3. Acquisitions

NJR Acquisitions

On November 22, 2024, the Company acquired approximately 9,800 solar energy systems from the subsidiary of a publicly traded, regulated utility company for $132.5 million (the “Initial NJR Acquisition”) pursuant to an asset purchase agreement (the “APA”). The solar energy systems acquired have an average remaining contract life of approximately 11 years. The Initial NJR Acquisition was funded in part by the proceeds from the concurrent issuance of the SP5 Facility and $22.7 million of the Company’s cash balances. Under the APA, the Company was obligated to acquire approximately 200 additional solar energy systems, subject to those systems having achieved operational milestones (the “Additional NJR Systems”), and assuming those milestones are achieved, the aggregate purchase consideration payable with respect to the Additional NJR Systems would be approximately $5.0 million pursuant to the APA, subject to adjustment thereof. The Initial NJR Acquisition and the Additional NJR Systems are herein termed the “NJR Acquisitions”.

During the three months ended September 30, 2025, the Company acquired 7 of the Additional NJR Systems for approximately $0.2 million in cash.

During the nine months ended September 30, 2025, the Company acquired 199 of the Additional NJR Systems for approximately $4.8 million in cash, inclusive of transaction costs of approximately $0.1 million. Subsequent to September 30, 2025, and upon achieving operational milestone, the Company purchasedone final Additional NJR System for $0.04 million.

The NJR Acquisitions have been accounted for as acquisitions of assets, wherein the total consideration paid was allocated to the assets acquired and liabilities assumed based on their relative fair value. The Company’s determination of the fair value of assets acquired and liabilities assumed was based on an independent third-party valuation, which involved significant estimates and assumptions, including Level 3 (unobservable) inputs, using the income method approach to value long-lived assets. The Company engages third-party appraisal firms to assist in the fair value determination, however management is responsible for, and ultimately determines the fair value. For the Initial NJR Acquisition in 2024, the Company estimated the fair value of the assets to be the same as the acquisition price, which was approximately $132.5 million, inclusive of transaction costs of $0.3 million, all of which was allocated to the solar energy systems. For the Additional NJR Systems acquired in 2025, the Company estimated the fair value of the assets to be the same as the acquisition price, which was approximately $5.3 million, inclusive of transaction costs of approximately $0.1 million, all of which was allocated to the solar energy systems.

Notes to Unaudited Condensed Consolidated Financial Statements

Note 4. Property and Equipment, Net

Property and equipment, net consisted of the following as of September 30, 2025 and December 31, 2024:

Cost of revenues - solar energy systems depreciation within the unaudited condensed consolidated statements of operations relates to depreciation expense of the Company’s solar energy systems. For the three and nine months ended September 30, 2025, the related amounts were $7.5 million and $22.1 million, respectively, and for the three and nine months ended September 30, 2024, the related amounts were $5.7 million and $17.1 million, respectively.

Depreciation expense related to other property and equipment is included within selling, general and administrative expenses within the unaudited condensed consolidated statements of operations, and for each of the three and nine months ended September 30, 2025 was $0.1 million and $0.2 million, respectively, and for each of the three and nine months ended September 30, 2024 was $0.1 million and $0.2 million, respectively.

Note 5. Intangible Assets, Net

The following table presents the details of intangible assets, net as recorded in the unaudited condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024:

Amortization of intangible assets for each of the three months ended September 30, 2025 and 2024 was $0.3 million for each period, of which $0.1 million and $0.2 million were recorded within revenues and selling, general and administrative expenses, respectively, within the unaudited condensed consolidated statements of operations.

Notes to Unaudited Condensed Consolidated Financial Statements

.Amortization of intangible assets for each of the nine months ended September 30, 2025 and 2024 was $0.9 million, of which $0.3 million and $0.6 million were recorded within revenues and selling, general and administrative expenses, respectively, within the unaudited condensed consolidated statements of operations.

The weighted-average remaining useful life of the intangibles identified above is approximately 15.3 years, which approximates the period over which the Company expects to utilize the estimated economic benefits.

As of September 30, 2025, expected amortization of intangible assets for each of the five succeeding fiscal years and thereafter is as follows:

Note 6. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following as of September 30, 2025 and December 31, 2024:

Notes to Unaudited Condensed Consolidated Financial Statements

Note 7. Non-Recourse Debt

The following table provides a summary of the Company’s non-recourse debt as of September 30, 2025 and December 31, 2024:

(1) Fair value adjustment is being amortized to interest expense over the life of the related debt instruments using the effective interest method. Amortization expense for the fair value adjustment and deferred financing costs for the three and nine months ended September 30, 2025, were $1.6 million and $4.9 million, respectively, and for the three and nine months ended September 30, 2024 were $1.5 million and $4.4 million, respectively.

The SP1 Facility includes debt service reserve letter of credits with related amounts outstanding of $17.1 million and $15.6 million as of September 30, 2025 and December 31, 2024, respectively. The SP2 and SP3 Facilities also include debt service reserve letter of credits with related amounts outstanding of $6.0 million, and $4.1 million, respectively, as of September 30, 2025 and December 31, 2024.

All amounts outstanding under the SP1 Facility are included in non-recourse debt, current in the unaudited condensed consolidated balance sheet as of September 30, 2025. The effective interest rate on the SP1 Facility was 7.01% and 7.16% as of September 30, 2025 and December 31, 2024, respectively.

The Company’s credit agreements related to each of its non-recourse debts require the Company to be in compliance with various covenants, and the Company was in compliance with those required covenants as of September 30, 2025.

Certain of the Company’s credit agreements require the Company, on a quarterly basis, to consider loan to value ratios when determining current and future debt principal payments, which are subject to change. As of September 30, 2025, the principal maturities of the Company’s debt were as follows:

Notes to Unaudited Condensed Consolidated Financial Statements

Note 8. Interest Rate Swaps

The purpose of the Company’s swap agreements is to convert the floating interest rate on its credit agreements, discussed above, to a fixed rate. As of September 30, 2025 and December 31, 2024, the notional amount of the interest rate swaps covered approximately 90% and 91%, respectively, of the balance of the Company’s floating rate term loans as of each period end. See Note 9. Fair Value Measurements for further information on the Company’s determination of the fair value of its interest rate swaps.

During the three and nine months ended September 30, 2025, the aggregate impact of the Company’s interest rate swaps was a gain of $0.4 million and loss of $5.8 million, respectively, of which $1.6 million and $11.9 million related to unfavorable changes in the fair value of the interest rate swaps within the unaudited condensed consolidated statements of operations, and $2.0 million and $6.2 million related to realized gains from settlements of the interest rate swaps, which are recognized within interest expense, net in the unaudited condensed consolidated statements of operations.

During the three and nine months ended September 30, 2024, the aggregate impact of the Company’s interest rate swaps was a loss of $8.3 million and a gain of $5.7 million, respectively, of which $11.3 million and $8.2 million related to unfavorable changes in the fair value of the interest rate swaps for each period within the unaudited condensed consolidated statements of operations, and $3.0 million and $13.8 million related to realized gains from settlements of the interest rate swaps, which are recognized within interest expense, net in the unaudited condensed consolidated statements of operations.

Note 9. Fair Value Measurements

The Company uses various assumptions and methods in estimating the fair values of its financial instruments.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The Company’s private warrants, which hadno minal value as of September 30, 2025 and December 31, 2024, were valued using a Black-Scholes model, pursuant to the inputs provided in the table below:

The Company’s interest rate swaps are not traded on a market exchange, and the fair values are determined using a valuation model based on a discounted cash flow analysis. This analysis reflects the contractual terms of the interest rate swap agreements and uses observable market-based inputs, including estimated future Secured Overnight Financing Rate (“SOFR”) interest rates. The fair value of the Company's interest rate swap is the net difference in the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on the expectation of future interest rates and are observable inputs available to a market participant. The interest rate swap valuation is classified as Level 2 of the fair value hierarchy.

The carrying value of the Company’s variable rate debt, which includes four senior debt facilities, approximates fair value as the underlying SOFR is redetermined monthly based on prevailing market rate. The Company engages a third-party valuation expert to assist in the fair value determination of its fixed rate debt, which includesone senior debt facility andone subordinated debt facility. The Company’s valuation of its fixed rate debt is based on information provided by Management and acceptable market pricing methods for determination of the applicable discount rate. In the aggregate, the fair value of the Company’s non-recourse debt as of September 30, 2025 and December 31, 2024 was $704.2 million and $723.8 million, respectively.

Notes to Unaudited Condensed Consolidated Financial Statements

The following table sets forth the Company’s assets and liabilities which are measured at fair value on a recurring basis by level within the fair value hierarchy:

Note 10. Stock-Based Compensation Expense

Stock-based compensation expense for stock options and restricted stock units for the three and nine months ended September 30, 2025 was $0.8 million and $2.4 million, and for the three and nine months ended September 30, 2024 was $0.7 million and $2.1 million, respectively. As of September 30, 2025, there was$7.0 million of unrecognized compensation cost related to stock options and restricted stock units which is expected to be recognized over the remaining vesting periods, with a weighted-average period of 2.8 years.

Stock Options

The Company grants stock options to certain employees that will vest over a period ofone tofour years. A summary of stock option award activity for the nine months ended September 30, 2025 was as follows:

Notes to Unaudited Condensed Consolidated Financial Statements

The aggregate intrinsic value of stock options outstanding as of September 30, 2025 was less than $0.1 million. There wereno stock options granted during the nine months ended September 30, 2025.

A summary of stock option award activity for the nine months ended September 30, 2024 was as follows:

The aggregate intrinsic value of stock options outstanding as of September 30, 2024 was $0.1 million. During the nine months ended September 30, 2024, the Company granted 295,229 stock options to its President and Chief Executive Officer (“CEO”) upon his appointment to such positions effective April 12, 2024.

Restricted Stock Units

The Company grants restricted stock units to certain employees that will generally vest over a period offour years. The fair value of restricted stock unit awards is estimated by the fair value of the Company’s common stock at the date of grant. Restricted stock units activity during the nine months ended September 30, 2025 was as follows:

Notes to Unaudited Condensed Consolidated Financial Statements

Restricted stock units activity during the nine months ended September 30, 2024 was as follows:

During the three and nine months ended September 30, 2024, the Company granted restricted stock unit awards of 88,636 shares of common stock to the CEO upon his appointment effective April 12, 2024. In addition, upon the separation of the former President and Chief Executive Officer (“Former CEO”) from the Company effective April 12, 2024,97,994 and 244,267 restricted stock units awarded to the Former CEO were vested and forfeited, respectively. The Company recorded $0.5 million of expense related to the 97,994 vested awards during the nine months ended September 30, 2024.

Former CEO's Ladder Restricted Stock Unit Award

In 2022, the Company granted the Former CEO a restricted stock unit award of 208,333 shares of common stock (the “Ladder RSUs”). The Ladder RSUs were to vest in 10% increments on the dates the plan administrator certified the applicable milestone stock prices had been achieved or exceeded, provided that the Former CEO remained employed on the date of certification and such achievement occurred withinten years of the date of the grant. The Company used a Monte Carlo simulation valuation model to determine the fair value of the award as of the grant date, which was accounted for as a liability until the separation of the Former CEO effective April 12, 2024. The following inputs were used in the simulation: grant date stock price of $9.36 per share, annual volatility of 85.0%, risk-free interest rate of 3.3% and dividend yield of 0.0%. For each tranche, a fair value was calculated as well as a derived service period which represents the median number of years it is expected to take for the Ladder RSUs to meet their corresponding milestone stock price excluding the simulation paths that result in the Ladder RSUs not vesting within the 10-year term of the agreement. Each tranche's fair value would have been amortized ratably over the respective derived service period.

Upon separation of the Former CEO from the Company effective April 12, 2024, the Ladder RSUs were terminated, and the Company recorded a gain of $0.7 million during the nine months ended September 30, 2024.

Notes to Unaudited Condensed Consolidated Financial Statements

Note 11. Consolidated VIEs and Noncontrolling Interests

The following table summarizes the Company’s noncontrolling interests as of September 30, 2025:

The tax equity entities were structured at inception so that the allocations of income and loss for tax purposes will flip at a future date. The terms of the tax equity entities’ operating agreements contain allocations of taxable income (loss), Section 48(a) ITCs and cash distributions that vary over time and adjust between the members on an agreed date (referred to as the flip date). The operating agreements specify either a date certain flip date or an internal rate of return (“IRR”) flip date. The date certain flip date is based on the passage of a fixed period of time as defined in the operating agreements for each entity. The IRR flip date is the date on which the tax equity investor has achieved a contractual rate of return. From inception through the flip date, the Class A members' allocation of taxable income (loss) and Section 48(a) ITCs is generally 99% and the Class B members' allocation of taxable income (loss) and Section 48(a) ITCs is generally 1%. After the related flip date (or, if the tax equity investor has a deficit capital account, typically after such deficit has been eliminated), the Class A members' allocation of taxable income (loss) will typically decrease to 5% (or, in some cases, a higher percentage if required by the tax equity investor) and the Class B members' allocation of taxable income (loss) will increase by an inverse amount. As of September 30, 2025, the allocations of income and loss for tax purposes had flipped for ORE F4 Holdco, LLC, while Volta Solar Owner II, LLC has not reached its flip date.

The Company’s historical noncontrolling interests are comprised of Class A units, which represent the tax equity investors' interest in the tax equity entities. Both the Class A members and Class B members may have call options to allow either member to redeem the other member's interest in the tax equity entities upon the occurrence of certain contingent events, such as bankruptcy, dissolution/liquidation and forced divestitures of the tax equity entities. Additionally, the Class B member in Volta Solar Owner II, LLC has the option of purchasing all Class A units, which are exercisable at any time during the periods specified under its governing document.

Notes to Unaudited Condensed Consolidated Financial Statements

The assets held by the Company’s VIEs can only be used to settle obligations of the VIEs, while the liabilities are the obligations of the Company’s VIEs. The following table summarizes the consolidated balance sheets of the Company’s VIEs included within assets and liabilities on the Company’s unaudited condensed consolidated balance sheets as of September 30, 2025 and December 31, 2024:

Note 12. Commitments and Contingencies

Legal Proceedings

The Company is periodically involved in legal proceedings and claims arising in the normal course of business, including proceedings relating to intellectual property, employment and other matters. Management believes the outcome of these proceedings, as outlined below, will not have a significant adverse effect on the Company’s financial position, operating results, or cash flows.

Securities Class Action Proceedings

On March 8, 2021, two putative securities class action complaints were filed against the Company, and certain of its current and former officers and directors in the federal district court for the Southern District of New York. Those cases were ultimately consolidated under C.A. No. 1:21-cv-2002, and a lead plaintiff was appointed in June 2021. On July 20, 2021, an amended complaint was filed alleging that certain public statements made by the defendants between October 2,

Notes to Unaudited Condensed Consolidated Financial Statements

2020, and March 2, 2021, violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Following negotiations with a mediator, in September 2023, the Company and the plaintiffs agreed on a settlement in principle in the aggregate amount of $19.5 million (the “Settlement Amount”), and on December 6, 2023, the lead plaintiff and the defendants entered into a stipulation and agreement of settlement requiring the Company to pay the Settlement Amount to resolve the class action litigation and the related legal fees and administration costs. On April 30, 2024, the New York Court approved a final settlement of the Class Action Litigation. The Settlement Amount was accrued as of December 31, 2023 and was subsequently offset by approximately $4.5 million of related loss recoveries from the Company’s directors and officers liability insurance policy with third parties, which was paid out in February 2024. The Company also paid the $15.0 million net settlement amount to the settlement claims administrator in February 2024.

On September 20, 2021, and October 19, 2021, two class action complaints were filed in the Delaware Court of Chancery against certain of the Company’s current officers and directors, and the Company’s sponsor of its special purpose acquisition company merger, Pivotal Investment Holdings II LLC. These actions were consolidated as in re XL Fleet Corp. (Pivotal) Stockholder Litigation, C.A. No. 2021-0808, and an amended complaint was filed on January 31, 2022. Defendants filed a motion to dismiss the amended complaint on May 13, 2022, and on July 11, 2022, plaintiffs filed a second amended complaint. The second amended complaint alleges various breaches of fiduciary duty against the Company and/or its officers, several allegedly misleading statements made in connection with the merger, and aiding and abetting breaches of fiduciary duty in connection with the negotiation and approval of the December 21, 2020 merger and organization of XL Hybrids, Inc., a Delaware corporation (“Legacy XL”) to become XL Fleet Corp. On August 19, 2022, defendants moved to dismiss the second amended complaint, which was granted in part and denied in part on June 9, 2023. The parties then engaged in discovery. On November 13, 2024, the Company filed a stipulation and settlement agreement seeking court approval to settle this matter in full for $4.75 million, which was accrued as of December 31, 2024 (see Note 6. Accrued Expenses and Other Current Liabilities). On March 26, 2025, the court approved the stipulation and settlement agreement, and in April 2025, the Company paid the settlement amount of $4.75 million.

Shareholder Derivative Actions

On June 23, 2022, the Company received a shareholder derivative complaint filed in the U.S. District Court for the District of Massachusetts, captioned Val Kay derivatively on behalf of nominal defendant XL Fleet Corp., against all current directors and former officers and directors, C.A. No. 1:22-cv-10977. The action was filed by a shareholder purportedly on XL Fleet Corp.’s behalf, and raises claims for contribution, as well as claims for breach of fiduciary duty, waste of corporate assets, unjust enrichment, and abuse of control. In March 2023, two shareholder derivative actions were filed in the U.S. District Court for the District of Delaware, namely Reali v. Griffin, et al., C.A. No. 1:23-cv-00289 and Tucci v. Ledecky, et al., C.A. 1:23-cv-00322. These actions were consolidated and captioned In re Spruce Power Holding Corporation Shareholder Derivative Litigation, C.A. No. 1:23-cv-00289. In August 2023, an additional derivative action was filed in the U.S. District Court for the Southern District of New York, captioned Boyce v. Ledecky, et al., C.A. No. 1:23-cv- 8591 (collectively, the “Derivative Matters”). On December 8, 2023, the parties reached a settlement-in-principle to settle, the Derivative Matters. The court granted preliminary approval of the settlement on May 1, 2024, and final approval in full on August 8, 2024. The settlement provides for certain corporate governance enhancements and no monetary payments. On August 14, 2024, the court awarded attorney fees of $1.0 million, which were paid in September 2024.

State Attorney Generals’ Investigations

In 2023, the Company received subpoenas from the attorneys general for the states of Connecticut, New Jersey, New York and Texas requesting information on the Company’s billing and operations practices, which are still ongoing. The Company has been timely responding to the states’ information requests and otherwise cooperating with these investigations and intends to continue to do so until they are resolved. At this time, the Company is unable to estimate potential losses, if any, related to these matters.

BMZ USA, Inc.

On February 11, 2022, BMZ USA Inc. (“BMZ”), a battery manufacturer, sued XL Hybrids for breach of contract, alleging that XL Hybrids failed to timely purchase the full allotment of batteries required under a certain master supply agreement between the parties. In January 2024, BMZ obtained a judgment for $3.9 million against XL Hybrids, Inc. In June 2024,

Notes to Unaudited Condensed Consolidated Financial Statements

BMZ sought to enforce the judgement against the Company in Massachusetts Trial Court and that enforcement action was dismissed in March 2025. BMZ appealed the ruling, however it was not successful, and BMZ subsequently filed to enforce the judgement in Colorado. As such, the Company currently estimates the potential loss to be approximately $1.2 million, which has been accrued for as of September 30, 2025 (See Note 6. Accrued Expenses and Other Current Liabilities).

ITC Recapture Provisions

The IRS may disallow and recapture some, or all, of the ITCs due to improperly calculated basis after a project was placed in service ("Recapture Event"). If a Recapture Event occurs, Spruce Power is obligated to pay the applicable Class A Member a recapture adjustment, which includes the amounts the Class A Members are required to repay the IRS, including interest and penalties, as well as any third-party legal and accounting fees incurred by the Class A Members in connection to the Recapture Event, as specified in the operating agreements. Such a payment by Spruce Power to the Class A Members would not be considered a capital contribution to the fund per the operating agreements, nor would it be considered a distribution to the Class A Members. No Recapture Event was deemed probable by the Company, therefore no accrual was recorded as of September 30, 2025 and December 31, 2024.

Parker-Hannifin

On March 11, 2024, the Company filed a lawsuit against Parker-Hannifin for a declaratory judgment, captioned XL Hybrids, Inc. v. Parker-Hannifin Corporation, No. 1:24-cv-10894-WGY (D. Mass, removed from Mass. State Court No. 2484-CV-00661). The case related to a contract for the purchase of motors designed, produced and manufactured by Parker-Hannifin for XL Hybrids, Inc. which was executed in July 2019. On April 5, 2024, Parker-Hannafin filed counterclaims, alleging that XL Hybrids, Inc. and the Company were in breach of the contract. On November 1, 2024, the parties reached a settlement in principle to settle the matter for $0.5 million, which the Company paid in January 2025.

Master SREC Purchase and Sale Agreement

The Company has forward sales agreements, which are related to a certain number of SRECs, to be generated from the Company’s solar energy systems located in Maryland, Massachusetts, Delaware, and New Jersey to be sold at fixed prices over varying terms of up to 20 years. In the event the Company does not deliver such SRECs to the counterparty, the Company could be forced to pay additional penalties and fees as stipulated within the contracts.

Indemnities and Guarantees

During the normal course of business, the Company has made certain indemnities and guarantees under which it may be required to make payments in relation to certain transactions. The duration of the Company’s indemnities and guarantees varies, however the majority of these indemnities and guarantees are limited in duration. Historically, the Company has not been obligated to make significant payments for such obligations, does not anticipate future payments, and as such, no reserve has been established and no other liabilities have been recorded for these indemnities and guarantees as of September 30, 2025 and December 31, 2024.

Insurance Claims and Recoveries related to Los Angeles Fires

In January 2025, a series of wildfires broke out in the Los Angeles area of California, resulting in real and personal property and natural resource damage, personal injuries and loss of life. Based on the Company’s current assessment, the Company wrote off approximately $0.2 million of net book value associated with the damaged solar assets during the nine months ended September 30, 2025, which is reflected within gain on asset disposal, net in the unaudited condensed consolidated statements of operations. No material loss claims have been reported or recognized within the unaudited condensed consolidated financial statements as of September 30, 2025. In addition, the Company has recordedno related insurance recoveries as of September 30, 2025. The Company subsequently received insurance proceeds of $0.3 million in October 2025 related to the Los Angeles wildfires.