SEC Filing Document

Company: ERock, Inc.
Ticker: 
CIK: 2110029
Filing Type: DRS/A
Document Type: DRS/A
Date Filed: 2026-04-24
Accession Number: 0001193125-26-177695
Exchange: 
SIC Code: 3620
SIC Description: Electrical Industrial Apparatus
URL: https://www.sec.gov/Archives/edgar/data/2110029/000119312526177695/filename1.htm

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requirements within the next twelve months include accounts payable and accrued liabilities, other current liabilities, and other obligations. We expect the cash required to meet these obligations to be primarily generated through a combination of cash from operations and our borrowing capacity under our 2025 Credit Agreement. Our long-term cash requirements under our various contractual obligations and commitments include: • Debt Obligations and Interest Payments—See Note 11—Debt, to our consolidated financial statements included in this prospectus for further detail of our debt and the timing of expected future principal and interest payments. • Operating Leases—See Note 9—Leases, in the Notes to our consolidated financial statements included in this prospectus for further detail of our obligations and the timing of expected future payments. believe the following sources will be sufficient to meet our anticipated cash requirements for at least the next twelve months while maintaining sufficient liquidity for normal operating purposes:

• our cash flows from operations; and

• availability of additional capital under our 2025 Credit Agreement.

Tax Receivable Agreement

Concurrently with the closing of the IPO, we will enter into the Tax Receivable Agreement with the TRA Beneficiaries and a
designated TRA representative. The Tax Receivable Agreement will provide for payment by us to the TRA Beneficiaries of 85% of the amount of the net cash tax savings, if any, that we actually realize or are deemed to realize (calculated using certain
assumptions) as a result of our use of certain tax benefits resulting from (i) certain increases in, or adjustments to, the tax basis of assets of ER Holdings and its subsidiaries resulting from exchanges of ER Holdings membership interests in the
future, (ii) certain tax attributes available

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to us as a result of the Reorganization, and (iii) certain other tax benefits related to our entering into the Tax Receivable Agreement, including tax benefits attributable to payments that we
make under the Tax Receivable Agreement. We will retain the remaining 15% of such amount of the net cash tax savings. See “Certain Relationships and Related Person Transactions—Proposed Transactions with ERock, Inc.—Tax
Receivable Agreement.”

The payments that we will be required to make under the Tax Receivable Agreement are
expected to be substantial. If we were to acquire all of the Class B Units and Class M Units (after the Class M Units have been first converted into Class B Units) held by the Continuing Equity Unitholders and Continuing Profits Interest
Unitholders, respectively, 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) that the Continuing Equity Unitholders redeemed or exchanged all of their Class B Units immediately after the consummation of the IPO at $     per share of our
Class A common stock, (ii) that the Continuing Profits Interest Unitholders converted all of their Class M Units for Class B Units of equivalent value at the time of the conversion immediately after the IPO, and the resulting Class B Units were
redeemed or exchanged in accordance with clause (i), (iii) no material changes in relevant tax law, (iv) a constant combined effective income tax rate of   % and (v) that we have sufficient taxable income in each year to realize on a
current basis the increased depreciation, amortization and other tax benefits that are the subject of the Tax Receivable Agreement. The actual future payments to the TRA Beneficiaries will vary based on the factors discussed above, and estimating
the amount of payments that may be made under each Tax Receivable Agreement is by its nature imprecise, insofar as the calculation of amounts payable depends on a variety of factors and future events. See “Risk Factors—Risks Related to
Our Corporate Structure, Our Class A Common Stock and this Offering.”

Payments under the Tax Receivable Agreement
are generally intended to partially compensate TRA Beneficiaries for tax savings that we realize as a result of the tax attributes that these TRA Beneficiaries deliver to us in connection with the UP-C structure. As such, we generally expect
payments to the TRA Beneficiaries to affect our liquidity in a manner comparable to the payment of taxes we would have owed in the absence of the UP-C structure. Because payments under the Tax Receivable Agreement are generally determined with
reference to the cash tax savings we actually realize based on our filed tax returns, they generally arise on an annual basis following the end of each taxable year in which we realize the relevant tax savings, and we retain 15% of such savings.
Taken together, this means that, on a current-pay basis and setting aside the acceleration scenarios described below, the Tax Receivable Agreement is not expected to require payments that exceed those that would have been required in the absence of
the UP-C structure; instead, it redirects a portion of a tax expense we would in any event have incurred, while leaving ERock with an incremental 15% cash benefit that would not otherwise have been available to it. Accordingly, we do not expect the
Tax Receivable Agreement payments, in the ordinary course of business, to impair our ability to meet other operating or financing needs to any greater extent than our income tax obligations would in the absence of the UP-C structure.

However, the timing and amount of the Tax Receivable Agreement payments may be affected by a number of factors. The amount of
payments in any given year will depend on, among other things, the extent to which Continuing Equity Unitholders and Continuing Profits Interest Unitholders exchange their units, our taxable income in that year and any prior years, applicable tax
rates, and the outcome of any tax audits or other proceedings. In addition, under the Tax Receivable Agreement, if we exercise our right to terminate the Tax Receivable Agreement early, or we breach any of our material obligations under the Tax
Receivable Agreement, our obligations under the Tax Receivable Agreement to make payments would be accelerated and based on certain assumptions, including an assumption that we would have sufficient taxable income to fully use all potential future
tax benefits that are subject to the Tax Receivable Agreement. As a result, the amount we are required to pay under the Tax Receivable Agreement may significantly exceed 85% of the actual cash tax benefits that we realize in respect of the tax
attributes subject to the Tax Receivable Agreement or the amounts may need to be paid prior to the actual realization, if any, of such future tax benefits. See “Risk Factors—Risks Related to Our Corporate Structure, Our Class A Common
Stock and this Offering.”

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Critical Accounting Estimates

Our financial statements, included elsewhere in this prospectus, are prepared in accordance with generally accepted accounting
principles (“GAAP”). The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures. These estimates
are based on historical experience, current facts, and other assumptions that management considers reasonable under the circumstances. We regularly evaluate these estimates and assumptions, but actual results may differ materially from our
estimates. Any such differences could impact our future financial statement presentation, financial condition, results of operations, and cash flows.

Our significant accounting policies are described in Note 2—Summary of Significant Accounting Policies, to our
consolidated financial statements included in this prospectus. The discussion below focuses on our most critical accounting estimates that materially affect our consolidated financial statements and require management to make difficult, subjective,
or complex judgments. We believe that understanding these critical accounting estimates is essential to fully appreciating our consolidated financial condition and results of operations.

Revenue Recognition

We recognize revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts
with Customers, which requires revenue to be recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration we expect to receive in exchange for those goods or services. We generate
revenue primarily from the design, installation, and operation of distributed generation power systems that provide resiliency power for commercial and industrial customers in the United States.

Significant judgment is required in identifying and evaluating performance obligations, estimating standalone selling prices,
and determining the timing of revenue recognition. Many of our customer contracts include multiple performance obligations. In such cases, we account for each performance obligation separately if it is distinct. The transaction price is allocated to
separate performance obligations based on their relative standalone selling prices (“SSP”). Because determining SSP requires judgment, we generally estimate the SSP for our installation services using an expected cost plus a margin
approach. When ongoing maintenance services are included in a contract, their SSP is also estimated using this same approach.