SEC Filing Document

Company: ERock, Inc.
Ticker: 
CIK: 2110029
Filing Type: S-1
Document Type: S-1
Date Filed: 2026-05-15
Accession Number: 0001193125-26-227199
Exchange: 
SIC Code: 3620
SIC Description: Electrical Industrial Apparatus
URL: https://www.sec.gov/Archives/edgar/data/2110029/000119312526227199/d12401ds1.htm

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Agreement). Under applicable tax rules, ER Holdings is required to allocate net taxable income disproportionately to its members in certain circumstances. As a result of potential differences in the amount of net taxable income allocable to us and to other members of ER Holdings, as well as the use of an assumed tax rate in calculating ER Holdings’ tax distribution obligations, we may receive distributions significantly in excess of our tax liabilities and obligations to make payments under the Tax Receivable Agreement. We may choose to manage these excess distributions through a number of different approaches, including through the payment of dividends to holders of our Class A common stock or by reinvesting the proceeds. Funds used by ER Holdings to satisfy its tax distribution obligations generally will not be available for reinvestment in its business and the tax distributions ER Holdings will be required to make may be substantial.

To the extent that we do not distribute such excess cash as dividends on our Class A common stock and instead, for example,
hold such cash balances or lend them to ER Holdings, the Continuing Equity Unitholders and Continuing Profits Interest Unitholders would benefit from any value attributable to such cash balances as a result of their ownership of Class A common stock
following a redemption or exchange of their Class B Units or Class M Units, notwithstanding that such holders may have participated previously as holders of Class B Units or Class M Units in distributions by ER Holdings that resulted in such excess
cash balances at ERock. Specifically, because any such retained proceeds would increase the value of the Class A common stock but would not correspondingly increase the value of the Class B Units, a Continuing Equity Unitholder who exchanges
their Class B Units (or a Continuing Profits Interest Unitholder who first exchanges their Class M Units for Class B Units) at a time when we have retained proceeds could receive Class A common stock that is worth more than the exchanged
Class B Units.

The A&R LLCA will include mechanisms designed to reduce or eliminate any such benefit.
Specifically, the A&R LLCA will provide that we generally will be required to either distribute any such proceeds to our stockholders or reinvest any such proceeds (other than immaterial proceeds). Additionally, ER Holdings may adjust either the
number of Class A Units, Class B Units, and Class M Units then outstanding or the exchange ratio between Class B Units and shares of Class A common stock to maintain parity between the Class B Units and the

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Class A common stock (i.e., to ensure, to the extent possible, that the value of the Class B Unit exchanged equals the value of the shares of Class A Common Stock received in that
exchange). There can be no assurance, however, that these mechanisms will fully prevent in whole or in part the economic benefit described above. Holders of our Class A common stock should be aware that this structural feature of our
organization may result in the Continuing Equity Unitholders receiving disproportionate economic benefits relative to pre-exchange holders of our Class A common stock, particularly during periods of significant distributions by ER Holdings.

The IRS might challenge the tax basis step-ups and other tax benefits we receive in
connection with the IPO and the related transactions and in connection with future acquisitions of membership interests in ER Holdings.

The Blocker Mergers and future Exchanges may result in increases in the tax basis of the assets of ER Holdings that otherwise
would not have been available. These increases in tax basis are expected to increase, or deemed to increase (for U.S. federal income tax purposes) our depreciation and amortization and, together with other tax benefits, reduce the amount of tax that
we would otherwise be required to pay, although it is possible that the Internal Revenue Service (the “IRS”) might challenge all or part of these tax basis increases or other tax benefits, and a court might sustain such a challenge. Our
ability to achieve benefits from any tax basis increases or other tax benefits will depend upon a number of factors, as discussed above and below, including the timing and amount of our future income. We will not be reimbursed for any payments
previously made under the Tax Receivable Agreement if the basis increases or other tax benefits described above are successfully challenged by the IRS or another taxing authority (other than by an offset against future payments under the Tax
Receivable Agreement). As a result, in certain circumstances, payments could be made under the Tax Receivable Agreement in excess of our ultimate cash tax savings.

We may incur tax and other liabilities attributable to the Blocked Unitholders as a result of certain reorganization transactions.

In connection with the Blocker Mergers, we will issue shares of Class A common stock as merger consideration
to the Blocked Unitholders. As the successor to these merged entities, we generally will succeed to and be responsible for any outstanding or historical tax or other liabilities of the Blocker Companies, including any liabilities incurred as a
result of the Blocker Mergers. Any such liabilities for which we are responsible could have an adverse effect on our liquidity and financial condition.

We may be required to pay additional taxes because of the U.S. federal partnership audit rules and potentially also state and local tax
rules.

Under the U.S. federal partnership audit rules, subject to certain exceptions, audit adjustments to items
of income, gain, loss, deduction, or credit of an entity treated as a partnership for U.S. federal income tax purposes (and any holder’s share thereof) are determined, and taxes, interest, and penalties attributable thereto, are assessed and
collected at the entity level. ER Holdings (or any of its applicable subsidiaries or other entities in which ER Holdings directly or indirectly invests that are classified as partnerships for U.S. federal income tax purposes) may be required to pay
additional taxes, interest, and penalties as a result of an audit adjustment, and us, as a member of ER Holdings (or such other entities), could be required to indirectly bear the economic burden of those taxes, interest, and penalties even though
we may not otherwise have been required to pay additional corporate-level taxes as a result of the related audit adjustment. Audit adjustments for state or local tax purposes similarly could result in ER Holdings (or any of its applicable
subsidiaries or other entities in which it directly or indirectly invests) being required to pay or indirectly bear the economic burden of state or local taxes and associated interest and penalties.

Under certain circumstances, ER Holdings or an entity in which ER Holdings directly or indirectly invests may be eligible to
make an election to cause members of ER Holdings (or such other entity) to take into account the amount of any underpayment, including any interest and penalties, in accordance with such member’s share

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in ER Holdings in the year under audit. We will decide whether to cause ER Holdings to make this election (subject to the terms of the A&R LLCA); however, there are circumstances in which the
election may not be available and, in the case of an entity in which ER Holdings directly or indirectly invests, such decision may be outside of our control. If ER Holdings or an entity in which ER Holdings directly or indirectly invests does not
make this election, the then-current members of ER Holdings (including us) could economically bear the burden of the underpayment.

If ER Holdings is or were to become a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes, we and
ER Holdings might be subject to potentially significant tax inefficiencies, and we would not be able to recover payments previously made by us under the Tax Receivable Agreement, even if the corresponding tax benefits were subsequently determined to
have been unavailable due to such status.

We intend to operate such that ER Holdings is not and does not become a
publicly traded partnership taxable as a corporation for U.S. federal income tax purposes. A “publicly traded partnership” is an entity that otherwise would be treated as a partnership for U.S. federal income tax purposes, the interests
of which are traded on an established securities market or are readily tradable on a secondary market or the substantial equivalent thereof.