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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legal settlements). We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues. The table below presents a reconciliation of net loss and net loss margin to Adjusted EBITDA and Adjusted EBITDA Margin: For the Year Ended December 31, (in thousands) Net loss $ $ (56,926 ) Interest expense 14,331 Depreciation and amortization expense 1,859 Income tax expense 158 Stock-based compensation 2,662 Change in fair value of warrants (1) 1,398 Non-recurring professional fees (2) 1,606 Adjusted EBITDA $ $ (34,912 ) Total revenues $ $ 128,490 Net loss margin % (44.3 )% Adjusted EBITDA margin % (27.2 )% (1) Non-cash change in fair value of our warrant liability at December 31, 2024. See Note 13—Equity—Warrant Units, to our consolidated financial statements included in this prospectus for more details. (2) Professional fees associated with our evaluation of potential capital market transactions in 2024. Operational Measures Contracted Power System Sales Backlog

Contracted Power System Sales Backlog represents the actual contracted value for purchases of power systems and ESI services,
whether invoiced or not, to be invoiced and recognized as revenue as a result of performing our obligations over the term of the contract, assuming no exceptions or contingencies are exercised, and includes adjustments for contract modifications
entered into after period-end and prior to the issuance of the related financial disclosures.

As of December 31,

(in thousands)

Contracted power system sales backlog $	1,219,121 $	227,656

Annualized Recurring Service Revenue

Annualized Recurring Service Revenue represents the annualized value of recurring revenue under contracted operations and
maintenance service and asset management agreements as of the measurement date, including both fixed contractual payments and variable payments based on typical utilization of such services.

As of December 31,

(in thousands)

Annualized recurring service revenue $	22,370 $	19,636

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Installed Base

Installed Base represents the total installed megawatt capacity of our power systems that have been deployed and are currently operational.

As of December 31,

Installed base in megawatts 997 931

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RISK FACTORS

Investing in our Class A common stock involves risks. The risks described below are not the only ones that we face.
Additional risks not presently known to us or that we currently deem immaterial individually or in the aggregate may also impair our business operations. We urge you to carefully consider the information in this prospectus, including the matters
addressed under “Cautionary Statement Regarding Forward-Looking Statements” and the following risks before making an investment decision. If any of these risks were to materialize, our business, financial condition, results of operations
and future prospects could be materially adversely affected. The trading price of our Class A common stock could consequently decline due to any of these risks, and you may lose all or part of your investment. For a summary of these risks, see
“Prospectus Summary—Summary of Our Risk Factors.”

Risks Related to Our Business, Industry and Sales

Our business depends on demand for distributed energy generation in the United States, which is an emerging and rapidly evolving market.
The development of this market, and demand for our power system solutions from data center, utility, C&I, healthcare and retail end markets, is uncertain and may not proceed as we expect. If distributed energy generation or our power system
solutions do not achieve widespread acceptance or demand is lower than anticipated, our business, prospects, financial condition and results of operations could be materially and adversely affected.

Distributed energy generation is still an emerging market, and it is uncertain whether potential customers will embrace
distributed generation in general or our power systems in particular. Enterprises may be unwilling to adopt our power systems over traditional or competing power sources such as distributed solar or grid-supplied electricity due to perceptions that
our company is unproven, lack of confidence in our business model, limited awareness of our power system solutions or concerns regarding regulatory or political challenges associated with technologies that use natural gas fuel or produce carbon
emissions.

Our business depends on demand for distributed power system solutions from data center, utility, C&I,
healthcare and retail end markets in the United States, and demand in these end markets depends on demand for electricity generated by distributed power systems and on the level of customer capital spending to design, construct and operate those
systems. Such demand and associated capital spend has primarily been driven by increases in demand for reliable power that has outpaced grid-sourced power supply, including due to the transition towards the electrification of transportation and
buildings, reshoring of manufacturing and the rapid adoption of artificial intelligence technologies and data center growth. However, customer investment decisions and the overall viability and demand for our power system solutions may be impacted
by many factors outside of our control, including changes in actual or projected power demand; changes in electricity price expectations; technological or operational shifts in energy usage, including artificial intelligence-driven load growth that
may not materialize as expected; changes in consumer consumption behaviors; changes in data-center siting trends, energy-efficiency measures and decarbonization initiatives; interconnection constraints, permitting timelines or the availability of
utility-scale or grid-connected alternatives, including as a result of accelerated grid interconnection, transmission expansion or other grid infrastructure upgrades, that increase grid-sourced power availability that may reduce the relative
attractiveness of distributed power systems and lead customers to redirect or defer capital spending; overall market acceptance of our power system solutions (including anti-natural-gas sentiment or misalignment with renewable and zero-carbon
procurement goals); the cost competitiveness, reliability and performance of our power systems relative to traditional or competing power sources; the availability and amount of government subsidies and incentives; the emergence, continuance or
success of, or increased government support for, other alternative energy or hydrogen-based technologies; prices and availability of traditional or competing power solutions; changes in laws, regulations or policies (including tariffs, taxes or
reshoring incentives); changes in internal budget priorities; geopolitical and macroeconomic instability, including wars, terrorism, political unrest, public health emergencies, inflation, recessionary conditions, boycotts, trade restrictions and
other business disruptions; and availability and cost of capital,

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including increases in interest rates or tightening in global capital markets (such as reduced tax-equity availability). Any of these factors may adversely impact demand for our power systems and
services or cause customers to reduce, delay or cancel planned projects requiring our power systems or alter or terminate our services. In addition, actual or anticipated reductions in demand in our core markets for reliable power, or increases in
grid-sourced power supply, could adversely impact demand for distributed power solutions and therefore demand for our power systems and services, which could result in lower capital expenditures, project modifications, delays or cancellations,
general business disruptions, and delays in payment of, or nonpayment of, amounts that are owed to us. Any such reductions in demand or effects could have a material adverse effect on our business, prospects, financial condition and results of
operations.

If the market for our power system solutions does not continue to develop as we anticipate, our business will
be harmed. As a result, predicting our future revenue and appropriately budgeting for our expenses is difficult, and we have limited insight into trends that may emerge and affect our business. If actual results differ from our estimates, or if we
adjust our estimates in future periods, our financial position and results of operations could be materially and adversely affected.

Certain estimates of market opportunity and forecasts of market growth included in this prospectus may prove to be inaccurate.

This prospectus includes several estimates by us and third parties of the potential addressable market for
electricity and for our power systems and services in the United States. Market opportunity estimates and growth forecasts, whether obtained from third-party sources or developed internally, are subject to significant uncertainty and are based on
assumptions and estimates that may not prove to be accurate. In particular, estimates and forecasts relating to the size and expected growth of electricity demand in our target markets, the adoption of our power system solutions, our capacity to
address this demand and our pricing may prove to be inaccurate. In addition, third-party estimates of the addressable market for commercial, industrial and public services electricity reflect the opportunity available from all participants and
potential participants in the market. Any inaccuracies or errors in third-party estimates of market opportunity may cause us to misallocate capital and other business resources, which could divert resources from more valuable alternative projects
and harm our business.

The addressable market we estimate may not materialize for many years, if ever, and even if the
markets in which we compete meet the size estimates and growth forecasts in this prospectus, our business could fail to grow at similar rates, if at all. Our growth is subject to many factors, including our success in implementing our business
strategy, which is subject to many risks and uncertainties. Accordingly, the forecasts of market size or growth included in this prospectus should not be taken as indicative of our future growth.