SEC Filing Document

Company: ERock, Inc.
Ticker: 
CIK: 2110029
Filing Type: DRS
Document Type: DRS
Date Filed: 2026-02-17
Accession Number: 0001193125-26-054926
Exchange: 
SIC Code: 3620
SIC Description: Electrical Industrial Apparatus
URL: https://www.sec.gov/Archives/edgar/data/2110029/000119312526054926/filename1.htm

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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. See Note 3 — Fair Value, for additional information on fair value measurements. Leases The Company has operating leases for real estate, forklifts, vehicles and trucks, and other equipment under noncancelable agreements whose initial terms typically range from three to 20 years, including renewal options that the Company is reasonably certain to exercise. The Company determines if these contracts are or contain a lease at inception and reviews the facts and circumstances of the arrangement to classify the leased asset as operating or finance under the lease standard. To assess whether a contract is or contains a Table of Contents Enchanted Rock Holdings, LLC Notes to Consolidated Financial Statements December

lease, the Company considers whether (i) explicitly or implicitly identified assets have been deployed in the contract and (ii) whether the Company obtains substantially all the
economic benefits from the use of the underlying asset and directs how and for what purpose the asset is used during the term of the contract.

The portion of active leases within the Company’s portfolio classified as operating leases under the standard are
included in right-of-use (“ROU”) assets, net, lease liabilities and noncurrent lease liabilities in the consolidated balance sheet. The ROU assets represent
the Company’s right to use the underlying asset for the lease term and lease liabilities represent the Company’s obligation to make minimum lease payments arising from the lease for the duration of the lease term.

The Company has evaluated all lease agreements in accordance with ASC 842, Leases (“ASC 842”) and
determined that none meet the criteria for classification as a finance lease. Specifically, none of the Company’s lease contracts transfer ownership of the underlying asset by the end of the lease term, provide a purchase option that is
reasonably certain to be exercised, have lease terms that constitute a major part of the remaining economic life of the asset, or result in the present value of lease payments equaling or exceeding substantially all of the fair value of the
underlying asset. As a result, all active leases are accounted for as operating leases.

Certain of the Company’s
leases include one or more options to renew, with renewal terms that can extend the lease term from two to five years. The exercise of lease renewal options is typically at the Company’s discretion. Additionally, many leases contain early
termination clauses; however, in active lease agreements, early termination typically requires the concurrence of both parties to the lease. The measurement of the lease term includes options to extend or renew the lease when it is reasonably
certain that the Company will exercise that option.

The Company uses the rate implicit in the lease when such rate
readily determinable to determine the present value of future minimum lease payments for the Company’s operating leases. If the rate implicit in the lease contracts is not readily determinable, the Company determines the present value of
future minimum lease payments by using its incremental borrowing rate based on the information available at commencement date of the lease.

Under ASC 842, minimum lease payments are expensed on a straight-line basis over the term of the lease, including renewal
options the Company is reasonably certain to exercise. In addition, some leases may require additional contingent or variable lease payments based on factors specific to the individual agreement. Variable lease payments for which the Company is
typically responsible include payments of real estate taxes, insurance, maintenance, and other operating costs in addition to rent. These payments are expensed as incurred and recorded as variable lease costs.

The Company elected the short-term expedient and will not record ROU assets and lease liabilities onto its balance sheet for
leases with terms of 12 months or less (ASC 842-20-25-2). The Company also elected the practical expedient of not allocating
consideration between lease and non-lease components for all asset classes except for real estate leases. For real estate leases, the Company accounts for leases and
non-lease components separately.

Segments

The Company operates as one operating segment that designs, installs, and operates distributed generation power systems
designed to provide resiliency power for commercial and industrial customers located within

Table of Contents

Enchanted Rock Holdings, LLC

Notes to Consolidated Financial Statements

December

the United States. See Note 4—Revenue Recognition, for additional information about the Company’s products and services. The Company’s operations are managed as a unified
business, with integrated processes for product development, marketing, sales, and customer support. As such, the Company reflects its financial results as one reportable segment, which reflects the consolidated performance of its business
activities. Management has determined that the Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer who has the ultimate responsibility for strategic decision making and resource allocation. The CODM
uses consolidated net loss to allocate resources, as well as to assess the performance, primarily by monitoring actual results compared to prior periods and expected results. The primary measure of profit or loss used by the CODM to make these
decisions is consolidated net loss. Significant expenses presented to the CODM are at the consolidated level and are the same as those on the face of the consolidated statement of operations. The Company’s CODM does not use any segment assets
measure to assess performance or decide how to allocate resources.

All of the Company’s assets are located in the
United States.

Recent Pronouncements

Segment Reporting

Effective January 1, 2024, the Company adopted Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The update enhances segment reporting transparency by requiring public entities to disclose significant segment expenses and
other segment items used by the CODM to assess performance and allocate resources. The Company applied the ASU retrospectively to all periods presented, as required.

Recently Issued Pronouncements Not Yet Adopted

Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which
modernizes the accounting for internal-use software costs by increasing the operability of the recognition guidance considering different methods of software development. ASU
2025-06, which can be applied prospectively, retrospectively, or with a modified transition approach, will be effective for annual and interim periods within fiscal years beginning after December 15,
2027, with early adoption permitted. The Company is currently evaluating the effects that the adoption of this standard will have on its consolidated financial statements and disclosures.

Income Statement Presentation

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting
Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which increases the transparency of expense information presented in the statement
of operations through disclosures of expanded disaggregation of relevant expense captions. This guidance will be effective for annual periods beginning after December 15, 2026, and interim periods thereafter, with early adoption permitted. The
Company is currently evaluating the effects that the adoption of this standard will have on its consolidated financial statements and disclosures.

Table of Contents

Enchanted Rock Holdings, LLC

Notes to Consolidated Financial Statements

December

Income Taxes

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):
Improvements to Income Tax Disclosures, which enhances the transparency and decision usefulness of income tax disclosures. The amendments require, among other things, expanded rate reconciliation disclosures with specific categories and greater
disaggregation of income taxes paid by jurisdiction.

For public business entities, the amendments are effective for
annual periods beginning after December 15, 2024 (i.e., the Company’s fiscal year beginning January 1, 2025). The amendments are effective for interim periods within fiscal years beginning after December 15, 2025 (i.e.,
beginning with interim periods in fiscal year 2026). Early adoption is permitted.

The Company has not yet adopted this
guidance and is currently evaluating the impact the adoption will have on its consolidated financial statements and related disclosures. The Company expects the adoption will result in expanded income tax disclosures but does not expect a material
impact on its consolidated financial position, results of operations, or cash flows.

3. FAIR VALUE

The Company’s financial instruments consist primarily of notes payable and warrants. The Company records its financial
assets and liabilities at fair value in accordance with the framework for measuring fair value in GAAP.

The
Company’s contingent warrant liability related to the 2024 Credit Agreement (see Note 11 — Debt — 2024 Credit Agreement), and the warrant liability and derivative liability related to the December 2024 Convertible Note (see
Note 11 — Debt — 2024 Note Purchase Agreement), measured at fair value on a recurring basis as of December 31, 2024, were as follows:

Level 1 Level 2 Level 3

Current Liabilities

Contingent warrant unit liabilities $	— $	— $	2,727

Total $	— $	— $	2,727

Noncurrent Liabilities

Warrant unit liabilities $	— $	— $	13,979

Derivative liabilities — — 1,492