UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to

Commission File No. 001-37707

iSUN, INC.

(Exact name of registrant as specified in its charter)

Delaware		47-2150172
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

400 Avenue D, Suite 10

Williston, Vermont

05495

(Address of Principal Executive Offices)

(Zip Code)

(802) 658-3378

(Registrant’s telephone number)

N/A

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		ISUN		Nasdaq Capital Market

Common Stock, Par Value $0.0001

(Title of class)

Securities registered pursuant to Section 12(g) of the Act: NONE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

The number of shares of the Registrant’s Common Stock outstanding at May 13, 2022 was 14,048,192 .

ISUN, INC.

Form 10-Q

Table of Contents

Part I. Financial Information

Item 1. Financial Statements		3

	Condensed Consolidated Balance Sheets (Unaudited)	3

	Condensed Consolidated Statements of Operations (Unaudited)	4

	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)	5

	Condensed Consolidated Statements of Cash Flows (Unaudited)	7

	Notes to Condensed Consolidated Financial Statements (Unaudited)	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		31

	Forward Looking Statements	31

	Business Introduction / Overview	31

	Critical Accounting Policies and Estimates	33

	Results of Operations	35

	Liquidity and Capital Resources	38

	Off-Balance Sheet Arrangements; Commitments and Contractual Obligations	38

Item 3. Quantitative and Qualitative Disclosures about Market Risk		39

Item 4. Controls and Procedures		39

	Evaluation of Disclosure Controls and Procedures	39

	Changes in Internal Control over Financial Reporting	39

Part II – Other Information		39

Item 1. Legal Proceedings		39

Item 1A. Risk Factors		39

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		39

Item 3. Default Upon Senior Securities		39

Item 4. Mine Safety Disclosures		39

Item 5. Other Information		39

Item 6. Exhibits		40

SIGNATURES		41

iSun, Inc.

Consolidated Balance Sheets

March 31, 2022 and December 31, 2021

(In thousands, except number of shares)

	March 31, 2022 (Unaudited)			December 31, 2021
Assets
Current Assets:
Cash	$	1,344		$	2,242
Accounts receivable, net of allowance		13,754			14,337
Costs and estimated earnings in excess of billings		3,527			4,004
Inventory		2,950			2,480
Other current assets		1,304			1,071
Total current assets		22,879			24,134
Property and equipment:
Building and improvements		336			967
Vehicles		2,942			2,908
Tools and equipment		2,405			3,127
Software		234			234
Construction in process		14			3
Solar arrays		6,708			6,859
Property, Plant and Equipment, Gross		12,639			14,098
Less accumulated depreciation		(3,341	)		(3,056	)
Property and equipment, net of accumulated depreciation		9,298			11,042
Other Assets:
Captive insurance investment		270			270
Goodwill		36,907			36,907
Intangible assets		17,651			18,907
Investments		12,320			12,420
Other assets		48			48
Total other assets		67,196			68,552
Total assets	$	99,373		$	103,728
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	9,712		$	13,188
Accrued expenses		6,256			7,628
Billings in excess of costs and estimated earnings on uncompleted contracts		3,221			2,389
Line of credit		5,433			4,468
Current portion of deferred compensation		31			31
Current portion of long-term debt		562			6,694
Total current liabilities		25,215			34,398
Long-term liabilities:
Deferred compensation, net of current portion		21			28
Deferred tax liability		-			772
Warrant liability		85			148
Other liabilities		3,328			3,375
Long-term debt, net of current portion		2,127			5,149
Total liabilities		30,776			43,870
Commitments and Contingencies (Note 8)		-			-
Stockholders’ equity:
Common stock – 0.0001 par value 49,000,000 shares authorized, 13,739,154 and 11,825,878 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively		1			1
Additional paid-in capital		72,507			60,863
Accumulated deficit		(3,911	)		(1,006	)
Total Stockholders’ equity		68,597			59,858
Total liabilities and stockholders’ equity	$	99,373		$	103,728

The accompanying notes are an integral part of these unaudited consolidated financial statements.

iSun, Inc.

Condensed Consolidated Statements of Operations (Unaudited)

For the Three Months Ended March 31, 2022 and 2021

(In thousands, except number of shares)

	2022			2021
	Three Months ended
	March 31,
	2022			2021

Earned revenue	$	15,087		$	7,261
Cost of earned revenue		11,917			7,142
Gross profit		3,170			119

Warehousing and other operating expenses		607			184
General and administrative expenses		7,022			1,465
Stock based compensation – general and administrative		1,244			1,071
Total operating expenses		8,873			2,719
Operating loss		(5,703	)		(2,601	)

Other income (expenses)
Gain on forgiveness of PPP Loan		2,592			-

Change in fair value of the warrant liability		63			(262	)

Interest expense, net		(629	)		(36	)

Loss before income taxes		(3,677	)		(2,899	)
(Benefit) provision for income taxes		(772	)		214

Net loss		(2,905	)		(3,113	)

Net income applicable to preferred shareholders		-			(70	)
Net loss available to shares of common stockholders	$	(2,905	)	$	(3,183	)


Net loss per share of Common Stock - Basic and diluted	$	(0.23	)	$	(0.41	)

Weighted average shares of Common Stock - Basic and diluted		12,646,446			7,695,279

The accompanying notes are an integral part of these unaudited consolidated financial statements.

iSun, Inc.

Condensed Consolidated Statement of Changes in Stockholders’ Equity (Unaudited)

For the Three Months Ended March 31, 2022

(In thousands, except number of shares)

	Shares		Amounts		Shares		Amounts		Capital		Deficit)			Total
	Preferred Stock				Common Stock				Additional Paid-In		Retained Earnings/ (Accumulated
	Shares		Amounts		Shares		Amounts		Capital		Deficit)			Total
Balance as of January 1, 2022		-		-		11,825,878	$	1	$	60,863	$	(1,006	)	$	59,858

Issuance under equity incentive plan		-		-		164,067		-		1,244		-			1,244

Sale of common stock		-		-		1,749,209		-		10,400		-			10,400

Net loss		-		-		-		-		-		(2,905	)		(2,905	)

Balance as of March 31, 2022		-		-		13,739,154	$	1	$	72,507

SEC Form 10-Q filed by iSun Inc.