SEC Filing Document

Company: ERock, Inc.
Ticker: 
CIK: 2110029
Filing Type: DRS/A
Document Type: DRS/A
Date Filed: 2026-04-01
Accession Number: 0001193125-26-138217
Exchange: 
SIC Code: 3620
SIC Description: Electrical Industrial Apparatus
URL: https://www.sec.gov/Archives/edgar/data/2110029/000119312526138217/filename1.htm

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analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage of us the trading price for our Class A common stock and other securities would be negatively affected. In the event we obtain securities or industry analyst coverage, if one or more of the analysts who covers us downgrades our securities, the price of our securities would likely decline. If one or more of these analysts ceases to cover us or fails to publish regular reports on us, interest in the purchase of our securities could decrease, which could cause the price of our Class A common stock and other securities and their trading volume to decline. We will depend on distributions from ER Holdings to pay any taxes and other expenses, including payments under the Tax Receivable Agreement.

We are a holding company and our only business is to act as the managing
member of ER Holdings, and our only material assets are Class A Units of ER Holdings, representing approximately  % of the membership interests of ER Holdings as of     , 2026. We do not have any independent means of
generating revenue. We anticipate that ER Holdings will continue to be treated as a partnership for U.S. federal income tax purposes and, as such, generally will not be subject to any entity-level U.S. federal income tax. Instead, taxable income
will be allocated to the members of ER Holdings. Accordingly, we will be required to pay income taxes on our allocable share of any net taxable income of ER Holdings. We intend to cause ER Holdings to make pro rata distributions to each of its
members, including us, in an amount intended to enable each member to pay all applicable taxes on taxable income allocable to such member and to allow us to make payments under the Tax Receivable Agreement. In addition, ER Holdings will reimburse us
for corporate and other overhead expenses. If the amount of tax distributions to be made exceeds the amount of funds available for distribution, we will receive a tax distribution payment before the other members of ER Holdings receive any
distribution and the balance, if any, of funds available for distribution shall be distributed to the other members of ER Holdings pro rata in accordance with their assumed tax liabilities. To the extent that we need funds, and ER Holdings is
restricted from making such distributions under applicable laws or regulations, or is otherwise unable to provide such funds, it could materially and adversely affect our ability to pay taxes and other expenses, including payments under the Tax
Receivable Agreement, and affect our liquidity and financial condition. Although we do not currently expect to pay dividends, such restrictions could also affect our ability to pay any dividends (if declared) in the future.

We are required to pay to the TRA Beneficiaries 85% of the tax benefits we receive from tax basis
step-ups (and certain other tax assets) attributable to our acquisition of Class B Units in connection with the IPO and in the future, and the amount of those payments is expected to be substantial.

We have entered into the Tax Receivable Agreement with the TRA Beneficiaries. The Tax Receivable Agreement
provides for payment by us to the TRA Beneficiaries of 85% of the amount of the net cash tax savings, if any, that we realize (or, under certain circumstances, are deemed to realize) as a result of (i) increases in tax basis (and use of certain
other tax benefits) resulting from our acquisition of Class B Units in ER Holdings

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in connection with the IPO and in Class B Unit future exchanges, (ii) certain favorable tax attributes (such as net operating losses attributable to
pre-merger tax periods) we acquired in the Blocker Mergers and (iii) increases in tax basis resulting from the payments we make to the TRA Beneficiaries under the Tax Receivable Agreement (as well as tax
benefits related to imputed interest). We will retain the benefit of the remaining 15% of these net cash tax savings. Generally, payments under the Tax Receivable Agreement will be made to the TRA Beneficiaries based on the tax assets, including
basis step-ups and certain other tax assets, delivered by those TRA Beneficiaries in connection with the IPO and in the future. Such payments will reduce the cash provided by the tax savings generated from the previously described transactions with
the members of ER Holdings and the TRA Beneficiaries that would otherwise have been available to ERock, Inc. for other uses, including reinvestment or dividends to holders of our Class A common stock.

The amount payable under the Tax Receivable Agreement generally will be based on an annual calculation of the reduction in our
U.S. federal, state and local taxes resulting from the use of certain pre-IPO tax attributes and tax benefits resulting from sales and exchanges by continuing members of ER Holdings. We expect that the payments that we may be required to make under
the Tax Receivable Agreement may be substantial. Assuming no material changes in the relevant tax law and that we earn sufficient taxable income to realize all tax benefits that are subject to the Tax Receivable Agreement, we expect that the
reduction in tax payments for us associated with the federal, state and local tax benefits described above would be approximately   $ million through 20   . Under such scenario we would be required to pay the TRA
Beneficiaries  % of such amount, or   $ million through 20   .

The term of the
Tax Receivable Agreement commenced upon the completion of the IPO and will continue until all tax benefits that are subject to the Tax Receivable Agreement have been used or have expired, or the Tax Receivable Agreement is terminated in accordance
with its terms. The payments under the Tax Receivable Agreement are not conditioned upon continued ownership of us by the TRA Beneficiaries. In addition, payments we make under the Tax Receivable Agreement will be increased by any interest accrued
from the due date (without extensions) of the corresponding tax return.

The actual tax benefit, as well as the amount and
timing of any payments under the Tax Receivable Agreement, will vary depending upon a number of factors, including the price of our common stock at the time of the exchange; the timing of future exchanges; the extent to which exchanges are taxable;
the amount and timing of the use of tax attributes; the amount, timing and character of our income; the U.S. federal, state and local tax rates then applicable; the depreciation and amortization periods that apply to the increases in tax basis; the
timing and amount of any earlier payments that we may have made under the Tax Receivable Agreement; and the portion of our payments under the Tax Receivable Agreement that constitute imputed interest or give rise to depreciable or amortizable tax
basis. Because of these factors, estimating the amount and timing of payments that may be made under the Tax Receivable Agreement is by its nature imprecise. We anticipate that the payments that we will be required to make to the beneficiaries under
the Tax Receivable Agreement will be substantial. We expect to receive distributions from ER Holdings in order to make any required payments under the Tax Receivable Agreement. However, we may need to incur debt to finance payments under the Tax
Receivable Agreement to the extent such distributions or our cash resources are insufficient to meet our obligations under the Tax Receivable Agreement as a result of timing discrepancies or otherwise. There may be a material negative effect on our
financial condition and liquidity if, as described below, the payments under the Tax Receivable Agreement exceed the actual benefits we receive in respect of the tax attributes subject to the Tax Receivable Agreement and/or distributions to us by ER
Holdings are not sufficient to permit us to make payments under the Tax Receivable Agreement.

For the sake of
illustration, assuming all outstanding Class B Units are exchanged for shares of Class A Common Stock, the estimated tax benefits to us subject to the Tax Receivable Agreement would be approximately $    and the
related undiscounted payment to the TRA Beneficiaries equal to 85% of the benefit would be approximately $    , assuming (i) exchanges occurred on the same day, (ii) a share price of $
per share of Class A common stock, (iii) no material changes in relevant tax law, (iv) a constant

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combined effective income tax rate of  % and (v) that we have sufficient taxable income in each year to use on a current basis the increased depreciation, amortization and other tax
benefits that are the subject of the Tax Receivable Agreement.