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 September 30, 2023

☐	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		(I.R.S. Employer
of incorporation or organization)		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 November 10, 2023 was 37,544,216.

ISUN, INC.

Form 10-Q

Table of Contents

Part I. Financial Information

Item 1. Financial Statements		3

	Condensed Consolidated Balance Sheets as of September 30, 2023 (Unaudited) and December 31, 2022	3

	Condensed Consolidated Statements of Operations for the Three and Nine months ended September 30, 2023 and 2022 (Unaudited)	4

	Condensed Consolidated Statement of Changes in Stockholders’ Equity for the Three and Nine months ended September 30, 2023 and 2022 (Unaudited)	5

	Consolidated Statements of Cash Flows for the Nine months ended September 30, 2023 and 2022 (Unaudited)	7

	Notes to Condensed Consolidated Financial Statements (Unaudited)	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		22

	Forward Looking Statements	22

	Business Introduction / Overview	22

	Critical Accounting Policies and Estimates	24

	Results of Operations	28

	Liquidity and Capital Resources	32

	Off-Balance Sheet Arrangements; Commitments and Contractual Obligations	33

Item 3. Quantitative and Qualitative Disclosures about Market Risk		33

Item 4. Controls and Procedures		33

	Evaluation of Disclosure Controls and Procedures	33

	Changes in Internal Control over Financial Reporting	34

Part II – Other Information		34

Item 1. Legal Proceedings		34

Item 1A. Risk Factors		34

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		34

Item 3. Default Upon Senior Securities		34

Item 4. Mine Safety Disclosures		34

Item 5. Other Information		34

Item 6. Exhibits		35

SIGNATURES		36

iSun, Inc.

Condensed Consolidated Balance Sheets as of

September 30, 2023 (Unaudited) and December 31, 2022

(In thousands, except number of shares)

	September 30, 2023			December 31, 2022
Assets
Current Assets:
Cash	$	5,600		$	5,455
Accounts receivable, net of allowance		13,127			8,783
Contract assets		11,485			7,324
Inventory		1,569			2,536
Other current assets		1,698			1,625
Total current assets		33,479			25,723
Other Assets:
Property and equipment, net of accumulated depreciation		8,297			8,440
Operating lease right-of-use assets, net		6,479			6,960
Captive insurance investment		629			270
Intangible assets, net		12,839			14,038
Investments		12,020			12,020
Other assets		30			30
Total other assets		40,294			41,758
Total assets	$	73,773		$	67,481
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	20,783		$	12,941
Accrued expenses		4,677			5,868
Operating lease liability		598			588
Contract liabilities		6,439			5,419
Current portion of deferred compensation		8			31
Current portion of long-term debt		8,544			5,374
Total current liabilities		41,049			30,221
Long-term liabilities:
Warrant liability		178			10
Operating lease liability, net of current portion		6,261			6,711
Other liabilities		2,448			3,026
Long-term debt, net of current portion		883			8,226
Total liabilities		50,819			48,194
Contingencies (Note 1l)		-			-
Stockholders’ equity:
Preferred stock - 0.0001 par value 1,000,000 shares authorized, 0 issued and outstanding as of September 30, 2023 and December 31, 2022		-			-
Common stock – 0.0001 par value 49,000,000 shares authorized, 34,940,885 and 15,083,109 issued and outstanding as of September 30, 2023, and December 31, 2022, respectively		3			2
Additional paid-in capital		85,492			74,070
Accumulated deficit		(62,541	)		(54,785	)
Total Stockholders’ equity		22,954			19,287
Total liabilities and stockholders’ equity	$	73,773		$	67,481

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

iSun, Inc.

Condensed Consolidated Statements of Operations

For the Three and Nine Months Ended September 30, 2023 and 2022 (Unaudited)

(In thousands, except number of shares and per share data)

	2023			2022			2023			2022
	Three Months ended						Nine Months ended
	September 30,						September 30,
	2023			2022			2023			2022
Earned revenue	$	27,909		$	19,034		$	70,274		$	50,597
Cost of earned revenue		22,481			15,417			55,360			40,057
Income before operating expenses		5,428			3,617			14,914			10,540

Warehousing and other operating expenses		183			172			634			1,539
General and administrative expenses		5,747			5,965			16,930			17,474
Stock based compensation – general and administrative		494			567			1,240			2,402
Depreciation and amortization		782			1,770			2,294			5,300
Total operating expenses		7,206			8,474			21,098			26,715
Operating loss		(1,778	)		(4,857	)		(6,184	)		(16,175	)

Other (expense) income:
Gain on forgiveness of PPP Loan		-			-			-			2,592
Change in fair value of the warrant liability		(178	)		7			(168	)		98
Loss on debt conversion		-			-			(303	)		-
Interest expense, net		(292	)		(84	)		(1,089	)		(800	)
Other (expense) income		(470	)		(77	)		(1,560	)		1,890

Loss before income taxes		(2,248	)		(4,934	)		(7,744	)		(14,285	)
Tax expense (benefit)		-			-			12			(765	)

Net loss	$	(2,248	)	$	(4,934	)	$	(7,756	)	$	(13,520	)

Net loss per share of Common Stock - Basic and diluted	$	(0.07	)	$	(0.36	)	$	(0.35	)	$	(0.98	)

Weighted average shares of Common Stock - Basic and diluted		30,898,334			13,546,624			22,222,377			13,769,564

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

iSun, Inc.

Condensed Consolidated Statement of Changes in Stockholders’ Equity

For the Three and Nine Months Ended September 30, 2023(Unaudited)

(In thousands, except number of shares)

	Shares		Amounts		Shares		Amounts		Capital		Deficit)			Total
	Preferred Stock				Common Stock				Additional Paid-In		(Accumulated
	Shares		Amounts		Shares		Amounts		Capital		Deficit)			Total
Balance as of January 1, 2023		-		-		15,083,109	$	2	$	74,070	$	(54,785	)	$	19,287

Issuance under equity incentive plan		-		-		225,169		-		373		-			373

Issuance of shares for acquisition of iSun Energy, LLC		-		-		200,000		-		-		-			-

Issuance of shares of common stock for repayment of debt		-		-		412,218		-		481		-			481

Proceeds from the sales of common stock, net		-		-		893,764		-		1,431		-			1,431

Net Loss		-		-		-		-		-		(2,997	)		(2,997	)

Balance as of March 31, 2023		-	$	-		16,814,260	$	2	$	76,355	$	(57,782	)	$	18,575

Issuance under equity incentive plan		-				-		-		373		-			373

Issuance of shares of common stock for repayment of debt		-				3,524,345				2,466					2,466

Proceeds from the sales of common stock, net		-				3,096,884				1,658					1,658

Net loss		-		-		-		-		-		(2,511	)		(2,511	)

Balance as of June 30, 2023		-	$	-		23,435,489	$	2	$	80,852	$	(60,293	)	$	20,561

Issuance under equity incentive plan		-		-