Company: SUNE
Filing Date: 2025-01-07
Form Type: 8-K
Source: 0001213900-25-001253
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Company: SUNation Energy, Inc.
Filing Date: 2025-01-07
Form: 8-K
Item: Item 7.01
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Item 7.01 Regulation
FD Disclosure

Extension
of CVR Agreement

As
previously disclosed in earlier Securities Exchange Act filings, on March 25, 2022, the Company, then known as Communication Systems
Inc. (“ CSI”), issued non-transferable Contingent Value Rights (“ CVRs”) in connection with its merger on March
28, 2022 (the “ Merger”) with Pineapple Energy, LLC. Each CVR represents the right to receive a pro rata portion of net cash
proceeds derived from the disposition of CSI’s assets following the Merger that CSI owned at the time of the Merger. The CVRs were
issued pursuant to the terms of the Contingent Value Rights Agreement dated March 25, 2022 (“ CVR Agreement”) which governs
the rights of Pineapple and the CVR Holders. On March 27, 2024 the term of the CVR Agreement was extended from March 31, 2024 to December
31, 2024.

In November 2024 the Company distributed, pro rata, $0.35 per CVR to the
CVR holders, which represented a total distribution of $850,269. Following this distribution, the third since March 2022, the Company
continues to hold proceeds from the sale of CSI’s pre-merger assets in a restricted cash account. However, the remaining restricted
cash is subject to Pineapple’s right under the CVR Agreement to be paid for all its “ Monetization Expenses” related
to CSI’s pre-merger operations, including the resolution of pending claims, Pineapple’s rights to be reimbursed for CSI related
wind-up expenses, and other contingencies. The resolution of these matters has taken longer than anticipated and, accordingly, the Company
and the designated representative of the CVR holders have agreed to extend the term of the CVR agreement to December 31, 2025 pursuant
to the terms of a Second Amendment to the CVR agreement, which is annexed hereto as Exhibit 10.1 to this Current Report on form 8-K report.

Liquidation
of Inactive Subsidiaries

Pursuant
to the terms of the CVR Agreement, the Company has sold substantially all of the assets related to JDL Technologies, Inc. (“ JDL”)
and Ecessa Corporation (“ Ecessa”), subsidiaries which were part of CSI’s pre-Merger operations.