UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K


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

For the fiscal year ended March 31, ~~2025~~2026


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

For the transition period from to

Commission File Number: 001-33887

Orion Energy Systems, Inc.

(Exact name of Registrant as specified in its charter)


Wisconsin		39-1847269
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
2210 Woodland Drive, Manitowoc, WI		54220

(Address of principal executive offices)		(Zip Code)

(920) 892-9340

(Registrant’s telephone number, including area code)

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, no par value

     OESX

     The Nasdaq Stock Market LLC
(NASDAQ Capital Market)

Securities registered pursuant to Section 12(g) of the act:

None

Indicate by check mark if the Registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

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 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 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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

The aggregate market value of shares of the Registrant’s common stock held by non-affiliates as of September 30, ~~2024~~2025, the last business day of the Registrant’s most recently completed second fiscal quarter, was ~~approximately~~ $2829,~~196~~734,~~921~~234.

As of May 3029, ~~2025~~2026, there were 334,~~305~~056,~~699~~528 shares of the Registrant’s common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's Proxy Statement for the ~~2025~~2026 Annual Meeting of Shareholders to be held on August 76, ~~2025~~2026 are incorporated herein by reference in Part III of this Annual Report on Form 10-K.

ORION ENERGY SYSTEMS, INC.

ANNUAL REPORT ON FORM 10-K

FOR THE YEAR ENDED MARCH 31, ~~2025~~2026

Table of Contents

	Page
PART I
Item 1 Business	6
Item 1A Risk Factors	12
Item 1B Unresolved Staff Comments	2725
Item 1C Cybersecurity	2725
Item 2 Properties	2825
Item 3 Legal Proceedings	2825
Item 4 Mine Safety Disclosures	2825
PART II
Item 5 Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities	2826
Item 6 [Reserved]	2927
Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations	3028
Item 7A Quantitative and Qualitative Disclosures About Market Risk	4641
Item 8 Financial Statements and Supplementary Data	4742
Item 9 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	8478
Item 9A Controls and Procedures	8478
Item 9B Other Information	8579
Item 9C Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	8579
PART III
Item 10 Directors, Executive Officers and Corporate Governance	8680
Item 11 Executive Compensation	8680
Item 12 Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters	8680
Item 13 Certain Relationships and Related Transactions, and Director Independence	8680
Item 14 Principal Accountant Fees and Services	8680
PART IV
Item 15 Exhibits and Financial Statement Schedules	8781
Item 16 Form 10-K Summary	9084
Signatures	9185

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K includes forward-looking statements that are based on Orion Energy Systems, Inc.'s ("Orion", "we", "us", "our" and similar references) beliefs and assumptions and on information currently available to us. When used in this Form 10-K, the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” and similar expressions identify forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in any forward-looking statements are reasonable, these plans, intentions or expectations are based on assumptions, are subject to risks and uncertainties, and may not be achieved. These statements are based on assumptions made by us based on our experience and perception of historical trends, current conditions, expected future developments and other factors that we believe are appropriate under the current circumstances. Such statements are subject to a number of risks and uncertainties, many of which are beyond our control. Our actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements contained in this Form 10-K. Important factors could cause actual results to differ materially from our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our beliefs and assumptions only as of the date of this Form 10-K, including particularly the Risk Factors described under Part I. Item 1A. of this Form 10-K. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth in this Form 10-K. Actual events, results and outcomes may differ materially from our expectations due to a variety of factors. Although it is not possible to identify all of these factors, they include, among others, the following:

•

Our ~~existing~~ability ~~liquidity~~to ~~and~~achieve ~~capital~~our ~~resources~~budgeted ~~may~~fiscal ~~not~~2027 berevenue ~~sufficient~~expectations, toand ~~allow~~related uspublic tofiscal ~~fund~~2027 orrevenue ~~sustain~~guidance, will have a significant impact on our ~~working~~cash ~~capital~~flow ~~requirements~~and orstock ~~pay~~price and ability to fund our ~~contractual~~operations orand satisfy our debt obligations;

•

~~Our~~We ~~payment~~are ofcurrently ~~the~~implementing ~~remaining~~a ~~Voltrek~~new ~~acquisition~~ERP ~~earn-out obligations may involve either payments in cash or our issuance of our common stock~~system, which ~~could~~will ~~materially~~involve ~~affect~~substantial ~~our~~cost ~~liquidity~~ and~~/or~~ ~~result~~potential indisruption ~~significant dilution~~ to our ~~shareholders~~normal operations. InOur ~~addition~~inability to ~~the~~successfully $1manage ~~million of our common stock issuable on~~ the ~~14th~~implementation ~~trading day after the public announcement~~ of our ~~fiscal~~new ~~2025~~ERP ~~financial~~system ~~results,~~could weadversely ~~also~~affect ~~have~~our ~~the~~ability ~~option~~ to ~~pay~~operate upour tobusiness ~~20%~~and ofotherwise ~~the~~negatively ~~then~~affect ~~remaining earn-out obligation at maturity in shares of~~ our ~~outstanding~~financial ~~common~~reporting ~~stock.~~and ~~Such~~the ~~issuances~~effectiveness of our ~~common~~internal ~~stock~~control ~~likely~~over ~~will~~financial ~~be materially dilutive to our shareholders~~reporting;

•

The amount of our remaining Voltrek acquisition earn-out obligations will likely be subject to resolution by an independent accounting firm. Such finally determined earn-out amount may exceed our current accrued liability for such earn-out amount and could materially affect our future liquidity;

We may need to raise additional equity capital or subordinated or convertible debt to provide us with additional liquidity and capital resources to help fund our operations, pay our senior debt obligations and pay our remaining Voltrek earn-out obligations. At our current stock price, any such equity capital raise would likely be materially dilutive to our shareholders;

Over the past several years, we have incurred substantial net losses and negative cash flow. If these trends continue, our liquidity and financial condition will be further materially adversely affected;

We are experiencing ongoing increasing pressures to reduce the selling price of our lighting products and incur the related negative impact on our gross margins, driven largely by the ongoing increase in competition from foreign competitors;

If we are unable to comply with NASDAQ’s minimum bid price requirement, including by effecting a reverse stock split, prior to September 15, 2025, our common stock may be delisted from NASDAQ. A reverse stock split may result in decreased trading volume and liquidity for our shares;

Our ability to achieve our budgeted fiscal 2026 revenue expectations, and related public fiscal 2026 revenue guidance, will have a significant impact on our cash flow and stock price and ability to fund our operations and satisfy our debt obligations;

Government tariffs and other actions have adversely affected, and may continue to adversely affect, our business, resulting in increased costs and reduced gross margins;

•

The reduction or elimination of incentives from the United States government for investments in electric vehicle ("EV") charging infrastructure may reduce demand for public EV charging products, in addition to reducing overall demand for EVs;

•

We do not have major sources of recurring revenue, a substantial portion of our revenues are derived from major project-based retrofit work that is awarded through a competitive bid process and we depend upon a limited number of customers in any given period to generate a substantial portion of our revenue. The reduction of revenue from our most significant customer over the past several fiscal years has had, and the potential future loss of other significant customers or a major customer would likely have, a materially adverse effect on our results of operations, financial condition and cash flows, and it is generally difficult to predict the timing of projects that will be awarded, which can impact our ability to achieve our expected financial results;

•

The reduction or elimination of investments in, or incentives to adopt, LED lighting or the elimination of, or changes in, policies, incentives or rebates in certain states or countries that encourage the use of LEDs over some traditional lighting technologies, including due to federal funding restrictions in the United States, could cause the demand for our lighting products to slow;

•

We are ~~currently~~experiencing ~~implementing~~ongoing aincreasing ~~new~~pressures ~~ERP system, which will involve substantial cost and potential disruption~~ to ~~our~~reduce ~~normal~~the ~~operations.~~average ~~Our~~selling ~~inability~~price ~~to successfully manage the implementation~~ of our ~~new~~products ~~ERP~~and ~~system~~related ~~could~~negative ~~adversely~~impact ~~affect~~on our ~~ability~~gross tomargins ~~operate~~driven ~~our~~largely ~~business~~by ~~and otherwise negatively affect our financial reporting and~~ the ~~effectiveness~~ongoing ofincrease ~~our~~in ~~internal~~competition ~~control~~from ~~over~~foreign ~~financial reporting~~competitors;

•

A substantial portion of our revenues are derived from major project-based retrofit work that is awarded through a competitive bid process. It is generally difficult to predict the timing of projects that will be awarded, which can impact our ability to achieve our expected financial results;

Our continued emphasis on indirect distribution channels to sell our products and services to supplement our direct distribution channels has had limited success to date;

Goodwill and other intangibles acquired through acquisitions could be impacted by our continued net losses and low levels of liquidity, thus resulting in a potential valuation impairment;

Our products use components and raw materials that may be subject to price fluctuations, shortages or interruptions of supply, particularly resulting from tariffs and other trade restrictions;

•

We increasingly rely on third-party manufacturers for the manufacture and development of our products and product components;

•

We are subject to the risk of a cybersecurity breach;

•

Macroeconomic pressures in the markets in which we operate may adversely affect our financial results;

•

Adverse conditions in the global economy, including due to changes in diplomatic and trade relationships, have negatively impacted, and could in the future negatively impact, our customers, suppliers and business; and

•

The success of our LED lighting retrofit solutions depends, in part, on our ability to claim market share away from our competitors.

You are urged to carefully consider these factors and the other factors described under Part I. Item 1A. “Risk Factors” when evaluating any forward-looking statements, and you should not place undue reliance on these forward-looking statements.

Except as required by applicable law, we assume no obligation to update any forward-looking statements publicly or to update the reasons why actual results could differ materially from those anticipated in any forward-looking statements, even if new information becomes available in the future.

ITEM 1. BUSINESS

As used herein, unless otherwise expressly stated or the context otherwise requires, all references to “Orion,” “we,” “us,” “our,” “Company” and similar references are to Orion Energy Systems, Inc. and its consolidated subsidiaries.

Overview

We provide state-of-the-art light emitting diode (“LED”) lighting systems, wireless Internet of Things (“IoT”) enabled control solutions, commercial and industrial electric vehicle ~~"EV"~~ charging infrastructure solutions and lighting and electrical maintenance services. We help our customers achieve their sustainability, energy savings and carbon footprint reduction goals through innovative technology and exceptional service. We sell our products and services into many vertical markets within the broader commercial and industrial market segment. Primary verticals include: big box retail, manufacturing, warehousing/logistics, commercial office, federal and municipal government, healthcare and schools. Our services consist of turnkey installation (lighting and EV) and system maintenance. Virtually all of our sales occur within North America.

Our principal ~~lighting~~ customers include large national account end-users, electrical distributors, electrical contractors and energy service companies (“~~ESCOS~~ESCOs”). ~~Currently,~~Our ~~a significant amount of our~~ lighting products are either manufactured at our leased production facility located in Manitowoc, Wisconsin, ~~although~~or assourced ~~the~~through ~~LED~~our ~~and~~global ~~related~~supply ~~IoT~~chain ~~market~~with ~~continues~~contract tomanufacture ~~evolve, we are increasingly sourcing products and components from third parties in order to diversify our product offerings~~partners.

We differentiate ourselves from our competitors by offering very efficient light fixtures (measured in lumens per watt) coupled with our project management services to national account customers to retrofit their multiple locations. Our comprehensive services include initial site surveys and audits, utility incentive and government subsidy management, engineering design, and project management from delivery through to installation and controls integration and commissioning. In addition, we began to offer lighting and electrical maintenance services in fiscal 2021. We ~~believe~~In ~~that~~October ~~providing~~2022, ~~these~~we ~~services~~acquired ~~enables~~Voltrek usLLC to("Voltrek"), ~~support~~which aleveraged ~~long-term~~our ~~business~~project ~~relationship~~management ~~with~~and ~~our~~maintenance ~~customers~~expertise ~~and~~into ~~results~~the inEV ansector. ~~increase~~In infiscal 2026, we expanded our ~~recurring~~services ~~revenue.~~to Weinclude ~~completed~~electrical ~~the~~contracting, ~~acquisition~~which ofis ~~Stay-Lite~~an ~~Lighting~~increasingly ongrowing ~~January~~area 1,of ~~2022,~~customer ~~which~~activity. ~~further~~We ~~expanded~~believe ~~our~~that ~~maintenance~~providing ~~services~~all ~~capabilities.~~of Onthese ~~October~~services 5,enables ~~2022,~~us weto ~~acquired~~support ~~Voltrek~~a ~~LLC~~long-term ~~("Voltrek"),~~business ~~which~~relationship ~~leveraged~~with our ~~project~~customers ~~management~~ and ~~maintenance~~results ~~expertise~~in ~~into~~an ~~the~~increase EVin ~~sector~~our recurring revenue.

Our lighting products consist primarily of LED lighting fixtures, many of which include IoT enabled control systems provided by third parties. We believe the market for LED lighting products continues to grow. Due to their size and flexibility in application, we also believe that LED lighting systems can address opportunities for retrofit applications that cannot be satisfied by other lighting technologies.

Other than our multi-year maintenance service contracts, we generally do not have long-term contracts with our customers for product or turnkey services that provide us with recurring annual revenue. We typically generate substantially all of our lighting revenue from sales of lighting systems and related services to governmental, commercial and industrial customers on a project-by-project basis. We also perform work under global services or product purchasing agreements with major customers with sales completed on a purchase order basis. The loss of, or substantial reduction in sales to, any of our significant customers, or our current single largest customer, or the termination or delay of a significant volume of purchase orders by one or more key customers, could have a material adverse effect on our results of operations in any given future period.

We typically sell our lighting systems in replacement of our customers’ existing lighting fixtures. We call this replacement process a "retrofit". We frequently sell our products and services directly to our customers and in many cases we provide design and installation services as well as project management services. We also sell our lighting systems on a wholesale basis, principally to electrical distributors, electrical contractors and ESCOs which then resell to their own customers.

The gross margins of our products can vary significantly depending upon the types of products we sell, with gross margins typically ranging from 10% to 50%. As a result, a change in the total mix of our sales among higher or lower gross margin products can cause our profitability to fluctuate from period to period.

Our fiscal year ends on March 31. We refer to our current fiscal year which ends on March 31, ~~2026~~2027 as "fiscal ~~2026~~2027". We refer to our most recently completed fiscal year, which ended on March 31, ~~2025~~2026, as “fiscal ~~2025~~2026”, and our prior fiscal year which ended on

March 31, ~~2024~~2025 as "fiscal ~~2024~~2025". ~~Our~~In each fiscal year, our fiscal first quarter of each fiscal year ends on June 30, our fiscal second quarter ends on September 30, our fiscal third quarter ends on December 31, and our fiscal fourth quarter ends on March 31.

Reportable Segments

Reportable segments are components of an entity that have separate financial data that the entity's chief operating decision maker ("CODM") regularly reviews when allocating resources and assessing performance. Our CODM is our chief executive officer. Previously, we had four reportable segments: Orion Services Group Segment, Orion Distribution Services Segment, Orion U.S. Markets Segment and Orion Electric Vehicle Charging Segment. Effective during the first quarter of fiscal 2024, we began to evaluate and report the business using three segments: lighting segment, maintenance segment and the electric vehicle charging segment (the "EV segment").

For financial results by reportable segment, please refer to Note 17 – Segment Data in our consolidated financial statements included in Item 8. of this Annual Report.

Lighting Segment

Our lighting segment develops and sells lighting products and provides construction and engineering services for our commercial lighting and energy management systems. Our lighting segment provides engineering, design, lighting products and in many cases turnkey solutions for large national accounts, governments, municipalities, schools and other customers. Our lighting segment sells mostly through direct sales and also through manufacturer representative agencies and to the wholesale contractor markets through ESCOs and contractors.

Maintenance Segment

Our maintenance segment provides retailers, distributors and other businesses with maintenance, repair and replacement services for the lighting and related electrical components deployed in their facilities.

EV Segment

Our EV segment offers leading electric vehicle charging expertise and provides EV turnkey installation solutions with ongoing support to all commercial verticals.

Products and Services

Our historical primary focus has been the sale of our LED lighting fixtures with integrated controls technology and related installation services. We will continue to focus on these products and services, as well as on expanding our maintenance service offerings and our EV charging station solutions.

Currently, a significant amount of our lighting products are manufactured at our leased production facility location in Manitowoc, Wisconsin, although as the LED market continues to evolve but subject to tariff impacts, we are increasing the sourcing of products and components from third parties in order to expand our product offerings. We are focused on researching, developing and/or acquiring new innovative LED products and technologies for the retrofit markets. We plan to continue developing creative new LED retrofit products in order to offer our customers a variety of integrated energy management services, such as system design, project management and installation. We third party source all of the EV charging stations and components that are installed by our EV segment.

Products

Our lighting and maintenance segments market fixtures for both interior and exterior use, including our LED high bay fixtures, LED troffer retrofits and smart lighting controls. Our smart lighting controls provide both lighting control options and data intelligence capabilities for building managers to log, monitor and analyze use of space, energy savings, and provide physical security of space.

In addition, in October 2022, we acquired Voltrek, which offers leading EV charging expertise and provides turnkey EV installation solutions with ongoing support to all commercial verticals. We believe there are growth opportunities for Voltrek both in its existing northeast geographic market, as well as on a national basis. We also plan to continue attempting to cross sell our EV charging solutions to our historical market channels and customers and vice versa.

existing northeast geographic market, as well as on a national basis. We also plan to continue attempting to cross sell our EV charging solutions to our historical market channels and customers and vice versa.

Other Products. We also offer our customers a variety of other LED fixtures to address their lighting and energy management needs, including fixtures designed for agribusinesses, parking lots, retail, mezzanine, outdoor applications and private label resale.

Warranty Policy. Our warranty policy generally provides for a limited five-year warranty on our LED products, although we do offer warranties ranging up to 10 years for certain LED products. Drivers, LED chips, EV charging stations and other electrical components are excluded from our standard warranty as they are covered by separate warranties offered by the original equipment manufacturers. We coordinate and process customer warranty inquiries and claims, including inquiries and claims relating to ballast and lamp components, through our customer service department.

Services

We provide a range of lighting-related energy management, EV installation and electrical contracting services to customers, including:

•

comprehensive site assessment, which includes a review of the current lighting and controls including IoT enabled devices requirements and energy usage at the customer’s facility;

•

services to EV charging customers including site audit, engineering, grant filing, installation, commissioning and network services;

•

site field verification, or SFV, during which we perform a test implementation of our energy management system at a customer’s facility;

•

utility incentive and government subsidy management, where we assist our customers in identifying, applying for and obtaining available utility incentives or government subsidies;

•

engineering design, which involves designing a customized system to suit our customers' facility lighting and energy management needs, and providing the customer with a written analysis of the potential energy savings and lighting and environmental benefits associated with the designed system;

•

project management, which involves us working with or serving as the electrical contractor in overseeing and managing all phases of implementation from delivery through installation for a single facility or through multi-facility roll-outs tied to a defined project schedule;

•

installation services, for our products, which we provide through our national network of qualified third-party installers;

•

complete facility design commissioning of IoT enabled control devices

•

recycling in connection with our retrofit installations, where we remove, dispose of and recycle our customer’s legacy lighting fixtures; ~~and~~

•

~~lighting~~electrical ~~and~~services, ~~electrical~~which ~~system~~include ~~maintenance~~battery ~~services~~storage ~~both~~installation, ~~preventative~~new ~~and~~construction ~~reactive~~electrical incontracting, ~~nature.~~electrical infrastructure management;

•

~~We also provide similar turnkey services to our EV customers that include site audit~~lighting, ~~engineering,~~electrical ~~grant~~system ~~filing, installation, commissioning~~ and ~~network~~EV ~~services. Our~~ maintenance ~~business provides~~ services ~~that~~including ~~includes~~ both preventative and reactive services.; ~~We also provide other services that comprise a small amount of our revenue.~~ and

•

other services that comprise a small amount of our revenue.

Our Customers

We primarily target commercial, institutional and industrial customers who have warehousing, retail, manufacturing and office facilities. In fiscal ~~2025~~2026, one customer accounted for 2426.30% of our total revenue. In fiscal ~~2024~~2025, that same customer accounted for 2518.21% of our total revenue, and in fiscal ~~2023~~2024, this same customer accounted for 1625.26% of our total revenue. ~~In fiscal 2026, we expect that our customer concentration will continue at the approximate level experienced in fiscal 2025.~~ As we continue to attempt to diversify our customer base by expanding our reach to national accounts, ESCOs, the agent-driven distribution channel, lighting maintenance customers and the EV market, we expect to continue to derive a significant percentage of our revenue from contracts with one or a limited number of customers. These contracts are entered into in the ordinary course of business and typically provide that we will deliver products and services on a work order or purchase order basis and any purchase order may be terminated prior to shipment. Our maintenance work orders or contracts may be for discrete projects or may have multi-year terms. These contracts generally do not guarantee that the customer will buy our products or services.

maintenance work orders or contracts may be for discrete projects or may have multi-year terms. These contracts generally do not guarantee that the customer will buy our products or services.

The amount and concentration of our revenues with one or more customers may fluctuate on a year to year or quarter to quarter basis depending on the number of purchase orders issued by our customers. The loss of a significant customer or the termination of a material volume of purchase orders (or the underlying agreements) could have a material adverse effect on our results of operations.

Sales and Marketing

We sell our ~~lighting~~ products and services in one of three ways: (i) directly as a result of Orion/Voltrek offering turnkey installation services; (ii) indirectly selling lighting products through independent sales agencies and broadline North American distributors; and (iii) through ESCOs. As of the end of fiscal ~~2025~~2026, we had 36 ESCO partners and independent lighting agencies representing us in substantially all of North America. We work cooperatively with our indirect channels through participation in national trade organizations and by providing product and sales training.

We have historically focused our marketing efforts on ~~traditional direct advertising, as well as~~ developing brand awareness through customer education, ~~and active~~ participation in trade shows and energy management seminars. These efforts have included participating in national, regional and local trade organizations, exhibiting at trade shows, executing targeted digital campaigns, advertising in select publications, public relations campaigns, social media and other lead generation and brand-building initiatives.

Competition

The market for energy-efficient lighting products, EV charging solutions and maintenance services is fragmented. We face strong competition primarily from manufacturers and distributors of lighting products and services as well as electrical contractors. We compete primarily on the basis of technology, cost, performance, quality, customer experience, energy efficiency, customer service and marketing support. We compete against other value-added resellers and electrical contractors in the EV charging market. We compete against a variety of service providers for lighting maintenance.

There are a number of lighting fixture manufacturers that sell LED products that compete with our lighting product lines. Lighting companies such as Acuity Brands, Inc., Signify Co., Cree Lighting, LSI Industries, Inc. and Current Lighting Solutions, LLC, are some of our main competitors within the commercial office, retail and industrial markets. We are also facing increased competition from manufacturers in low-cost countries.

Intellectual Property

As of March 31, ~~2025~~2026, we had been issued over ~~100~~90 United States patents and have applied for a number of additional United States patents. The patented and patent pending technologies cover various innovative elements of our products, including our ~~HIF and~~ LED fixtures and controls. Our patented LDRTM product ~~allows~~enables ~~for a~~ significantly ~~quicker~~faster installation ~~when~~than ~~compared to~~ competitor's commercial office lighting products. WeOur ~~offer~~ smart lighting ~~controls~~control ~~that~~offerings ~~allow~~enable our lighting fixtures to ~~selectively~~deliver ~~provide~~the adesired ~~targeted~~ amount of light ~~where and~~ when it is needed most.

We believe that our patent portfolio as a whole is material to our business. ~~We also believe that our patents covering our ability to manage the thermal~~ and ~~optical performance of our lighting products are material to our business, and~~ that the loss of these patents could significantly and adversely affect our business, operating results, and prospects.

Backlog

Backlog represents the amount of revenue that we expect to realize in the future as a result of firm, committed orders. Our backlog as of March 31, ~~2025~~2026 and March 31, ~~2024~~2025 totaled $1730.31 million and $2217.03 million, respectively. We generally expect our backlog to be recognized as revenue within one year. Backlog does not include any amounts for contracted maintenance services.

Manufacturing and Distribution

We lease an approximately 266,000 square foot primary manufacturing and distribution facility located in Manitowoc, Wisconsin, where ~~most~~many of our products are manufactured. We utilize both solar and wind power to support the energy requirements for our manufacturing facility, allowing us to reduce our carbon footprint.

We generally maintain a significant supply of raw material and purchased and manufactured component inventory. We contract with transportation companies to ship our products and manage all aspects of distribution logistics. We generally ship our products directly to the end user.

Research and Development

Our research and development efforts are centered on developing new LED products and technologies and enhancing existing products. The products, technologies and services we are developing are focused on increasing end user energy efficiency and enhancing lighting output. Over the last three fiscal years, we have focused on developing additional LED products, resulting in our development and commercialization of several new suites of LED interior high bay products. Some of the products we have developed are designed to be produced in our manufacturing facility in Manitowoc, Wisconsin while others are sourced from contract manufacturers.

We operate a research and development lab and test facilities in our Jacksonville, Florida and Manitowoc, Wisconsin locations.

Regulatory Matters

Our operations are subject to federal, state, and local laws and regulations governing, among other things, emissions to air, discharge to water, the remediation of contaminated properties and the generation, handling, storage, transportation, treatment, and disposal of, and exposure to, waste and other materials, as well as laws and regulations relating to occupational health and safety. We believe that our business, operations, and facilities are being operated in compliance in all material respects with applicable environmental and health and safety laws and regulations.

State, county or municipal statutes often require that a licensed electrician be present and supervise each retrofit project. Further, all installations of electrical fixtures are subject to compliance with electrical codes in virtually all jurisdictions in the United States. In cases where we engage independent contractors to perform our retrofit projects, we believe that compliance with these laws and regulations is the responsibility of the applicable contractor.

Our Corporate and Other Available Information

We were incorporated as a Wisconsin corporation in April 1996 and our corporate headquarters are located at 2210 Woodland Drive, Manitowoc, Wisconsin 54220. Our Internet website address is www.orionlighting.com. Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are available through the investor relations page of our internet website free of charge as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission ("SEC"). We are not including the information contained on our website as part of, or incorporating it by reference into, this report.

Human Capital

As of March 31, ~~2025~~2026, we had ~~approximately~~174 ~~182~~ full-time employees. We also employ temporary employees in our manufacturing facility as demand requires. Our employees are not represented by any labor union, and we have never experienced a work stoppage or strike due to employee relations.

We are an employee-centric organization, maintaining a safe and respectful environment that provides opportunity for our employees.

We believe our employees are among our most important resources and are critical to our continued success. We focus significant attention on attracting and retaining talented and experienced individuals to manage and support our operations. We pay our employees competitively and offer a broad range of company-paid benefits, which we believe are competitive with others in our industry.

We are committed to hiring, developing and supporting a diverse and inclusive workplace. Our management teams and all of our employees are expected to exhibit and promote honest, ethical and respectful conduct in the workplace. We will not tolerate discrimination or harassment in any form. All of our employees must adhere to a code of conduct that sets standards for appropriate behavior and includes required annual training on preventing, identifying, reporting and stopping any type of unlawful discrimination.

ITEM 1A. RISK FACTORS

You should carefully consider the risk factors set forth below and in other reports that we file from time to time with the Securities and Exchange Commission and the other information in this Annual Report on Form 10-K. The matters discussed in the following risk factors, and additional risks and uncertainties not currently known to us or that we currently deem immaterial, could have a material adverse effect on our business, financial condition, results of operations and future growth prospects and could cause the trading price of our common stock to decline.

Risk Factor Summary

Our business is subject to a number of risks and uncertainties, including those highlighted immediately following this summary. Some of these risks are summarized below:

•

~~Our~~We ~~payment~~are ofcurrently ~~the~~implementing ~~remaining~~a ~~Voltrek~~new ~~acquisition~~ERP ~~earn-out obligations may involve either payments in cash or our issuance of our common stock~~system, which ~~could~~will ~~materially~~involve ~~affect~~substantial ~~our~~cost ~~liquidity~~ and~~/or~~ ~~result~~potential indisruption ~~significant dilution~~ to our ~~shareholders~~normal operations. InOur ~~addition~~inability to ~~the~~successfully $1manage ~~million of our common stock issuable on~~ the ~~14th~~implementation ~~trading day after our public announcement~~ of our ~~fiscal~~new ~~2025~~ERP ~~financial~~system ~~results,~~could weadversely ~~also~~affect ~~have~~our ~~the~~ability ~~option~~ to ~~pay~~operate upour tobusiness ~~20%~~and ofotherwise ~~the~~negatively ~~then~~affect ~~remaining earn-out obligation at maturity in shares of~~ our ~~outstanding~~financial ~~common~~reporting ~~stock.~~and ~~Such~~the ~~issuances~~effectiveness of our ~~common~~internal ~~stock~~control ~~likely~~over ~~will~~financial ~~be materially dilutive to our shareholders~~reporting.

•

We may need to raise additional equity capital or subordinated or convertible debt to provide us with additional liquidity and capital resources to help fund our operations, pay our senior and anticipated subordinated debt obligations and pay our remaining Voltrek earn-out obligations. At our current stock price, any such equity capital raise would likely be materially dilutive to our shareholders.

Government tariffs and other actions have adversely affected, and may continue to adversely affect, our business, resulting in increased costs and reduced gross margins.

•

The reduction or elimination of incentives from the United States government for investments in EV charging infrastructure may reduce demand for public EV charging products, in addition to reducing overall demand for EVs.

•

We do not have major sources of recurring revenue, a substantial portion of our revenues are derived from major project-based retrofit work that is awarded through a competitive bid process, and we depend upon a limited number of customers in any given period to generate a substantial portion of our revenue. The reduction of revenue from our most significant customer over the past several fiscal years has had, and the potential future loss of other significant customers or a major customer would likely have, a materially adverse effect on our results of operations, financial condition and cash flows, and it is generally difficult to predict the timing of projects that will be awarded, which can impact our ability to achieve our expected financial results.

•

We are ~~currently~~experiencing ~~implementing~~ongoing aincreasing ~~new~~pressures ~~ERP~~to ~~system,~~reduce ~~which~~the ~~will~~average ~~involve~~selling ~~substantial~~price ~~cost~~of ~~and potential disruption to~~ our ~~normal~~products ~~operations.~~and ~~Our~~related ~~inability~~negative toimpact ~~successfully~~on ~~manage~~our ~~the~~gross ~~implementation~~margins ofdriven ~~our~~largely ~~new~~by ~~ERP~~the ~~system~~ongoing ~~could~~increase ~~adversely~~in ~~affect~~competition ~~our~~from foreign competitors.

•

ability to operate our business and otherwise negatively affect our financial reporting and the effectiveness of our internal control over financial reporting.

Our continued emphasis on indirect distribution channels to sell our products and services to supplement our direct distribution channels has had limited success to date.

Goodwill and other intangibles acquired through acquisitions could be impacted by our continued net losses and low levels of liquidity, thus resulting in a potential valuation impairment.

Our products use components and raw materials that may be subject to price fluctuations, shortages or interruptions of supply, particularly resulting from tariffs and other trade restrictions.

•

We increasingly rely on third-party manufacturers for the manufacture and development of our products and product components.

•

We are subject to the risk of a cybersecurity breach.

•

Macroeconomic pressures in the markets in which we operate may adversely affect our financial results.

•

Adverse conditions in the global economy including due to changes in diplomatic and trade relationships, have negatively impacted, and could in the future negatively impact, our customers, suppliers and business.

•

The success of our LED lighting retrofit solutions depends, in part, on our ability to claim market share away from our competitors.

Risks Related to Our Business

Financial Risks

~~Our existing liquidity and capital resources may not be sufficient to allow us to fund or sustain our working capital requirements or pay our contractual or debt obligations.~~12

Our ~~existing~~ability ~~liquidity and capital resources may not be sufficient~~ to ~~allow~~achieve ~~us to effectively fund or sustain~~ our ~~working~~budgeted ~~capital~~fiscal ~~requirements~~2027 orrevenue ~~pay our contractual or debt obligations~~expectations, ~~including~~and ~~our~~related ~~senior~~public ~~debt~~fiscal to2027 ~~Bank~~revenue ofguidance, ~~America~~will orhave ~~our~~a ~~remaining~~significant ~~earn-out~~impact ~~obligations~~on ~~owed in connection with~~ our ~~acquisition~~cash offlow ~~Voltrek.~~and Ifstock weprice ~~require~~and ~~additional~~ability ~~capital resources, we may not be able~~ to ~~obtain~~fund ~~sufficient~~our ~~equity~~operations ~~capital~~ and~~/or~~ ~~debt~~satisfy ~~financing~~our ~~on acceptable terms or conditions, or at all. Factors affecting the availability to us of additional equity capital or~~ debt ~~financing on acceptable terms and conditions, or in sufficient amounts, include:~~obligations.

We have historically had difficulties in achieving our budgeted revenue expectations, and related public annual revenue guidance. Our ~~history~~ability ofto ~~operating~~achieve ~~losses~~our ~~over~~budgeted ~~the~~fiscal ~~past~~2027 ~~several~~revenue ~~years;~~expectations, and related public fiscal 2027 revenue guidance, will have a significant impact on our cash flow, financial condition and stock price and ability to fund our operations and satisfy our debt obligations.

Our frequent inability to achieve our financial results guidance or budget expectations;

Our anticipated senior debt and subordinated earn-out debt obligations and security interests in substantially all of our assets;

The use of funds to help satisfy our remaining Voltrek earn-out obligations;

Our current and future financial condition;

Our limited collateral availability;

Our current customer concentration;

The market’s, investors’ and lenders’ view of our company, industry and products;

Our ability to achieve budgeted expectations or revenue guidance and the perception in the equity and debt markets of our ability to execute and sustain our business plan or achieve our operating results expectations;

The price, volatility and trading volume and history of our common stock;

Our ability to successfully attain shareholder approval of, and complete, a reverse stock split that helps us to avoid being delisted from NASDAQ on September 25, 2025;

The impact of tariffs and other macroeconomic and geopolitical factors on our profitability.

Our inability to obtain the equity capital or debt financing necessary to fund our operations could force us to scale back or restructure our operations or our senior or anticipated subordinated debt obligations. If we are unable to obtain any necessary additional equity capital or debt financing, our results of operations, financial condition and cash flows could be materially adversely affected.

Our payment of the remaining Voltrek acquisition earn-out obligations may involve either payments in cash or our issuance of our common stock, which could materially affect our liquidity, limit our operational and financial flexibility and/or result in significant dilution to our shareholders.

On June 23, 2025, we entered into a binding term sheet (the “Term Sheet”) with Final Frontier, LLC (“Final Frontier”) and its owner, the prior owners of Voltrek, with respect to our remaining earn-out obligations owed to Final Frontier pursuant to our October 5, 2022 acquisition of Voltrek. Pursuant to the Term Sheet, on August 1, 2025, we will pay Final Frontier $875,000 in full and final payment of our Voltrek acquisition fiscal 2024 earn-out obligations. We also agreed with Final Frontier to submit the final determination of our fiscal 2025 and aggregate fiscal 2023 through fiscal 2025 earn-out obligations to binding arbitration if not otherwise mutually agreed by the parties. We agreed to pay to Final Frontier the finally determined remaining earn-out amount as follows: (i) $1.0 million in our common stock issuable 14 trading days after our fiscal 2025 earnings announcement and (ii) the remaining amount pursuant to an anticipated senior subordinated second lien note maturing on July 15, 2027 (the “Senior Subordinated Note”). We agreed to pay monthly principal payments to Final Frontier on the anticipated Senior Subordinated Note of $25,000 beginning on January 15, 2026, which will increase to $50,000 on July 15, 2026 through maturity. We will also pay interest monthly to Final Frontier at the annual rate of 7% beginning on July 15, 2025. We have the right to pay up to 20% of the remaining outstanding earn-out amount at maturity in shares of our common stock. The anticipated Senior Subordinated Note will be subordinated to our senior credit facilities with Bank of America and will be secured by a second lien on all of our assets. We and Final Frontier agreed to use our respective commercially reasonable best efforts to agree to final documentation further reflecting the terms and conditions set forth in the Term Sheet within 30 days of entering into the Term Sheet.

The requirement to repay our remaining Voltrek acquisition earn-out obligations, as well as our senior debt with Bank of America, may negatively impact our liquidity or limit our operational and financial flexibility, as well as divert resources from operating expenses, potentially harming relationships with suppliers, hindering growth strategies and jeopardizing our business. In addition, such obligations could result in holders of our common stock not receiving any consideration in a sale of our business, or if we were to liquidate, dissolve or wind-up, either voluntarily or involuntarily. Additionally, our payments of some of our Voltrek earn-out obligations in shares of our common stock may result in our existing shareholders experiencing significant dilution to the value of their investment in our common stock.

Our remaining Voltrek acquisition earn-out obligations are likely to be subject to disagreement between us and the sellers of Voltrek and subject to final resolution by an independent accounting firm. Such finally determined earn-out amount could be in excess of our current accrued liability for such earn-out amount and could materially adversely affect our future liquidity.

We may owe additional material earn-out payments based on Voltrek’s financial performance in fiscal 2025. We have currently accrued an estimated liability of approximately $3.3 million for such earn-out payments. The total amount due will be subject to acceptance between us and the sellers of Voltrek. If there is any disagreement over the final amount, it would likely be subject to final resolution by an independent accounting firm. The final earn-out amount determined to be owed by us could be in excess of our current accrued liability for such earn-out amount and could materially adversely affect our liquidity.

We may need to raise additional equity capital or subordinated or convertible debt to provide us with additional liquidity and capital resources to help fund our operations and pay our senior debt to Bank of America and our remaining Voltrek acquisition earn-out obligations. At our current stock price, such an equity or convertible debt raise would likely be materially dilutive to our shareholders.

We may need to raise additional equity capital or subordinated or convertible debt in order to fund our operations, pay our senior debt to Bank of America and pay our remaining Voltrek earn-out obligations, and may pursue equity or debt financings, which may be materially dilutive to our existing shareholders. At our current stock price, the issuance of additional common stock or convertible debt would significantly dilute the value our common stock held by existing shareholders. Similarly, any new securities we may issue may carry preferences, superior voting rights, or additional terms that could adversely affect shareholders of our common stock. Future

capital raising efforts may incur substantial costs, such as investment banking, legal and accounting fees, and could lead to non-cash expenses that further negatively impact our financial condition.

We have historically had difficulties in achieving our budgeted revenue expectations, and related public annual revenue guidance. Our ability to achieve our budgeted fiscal 2026 revenue expectations, and related public fiscal 2026 revenue guidance, will have a significant impact on our cash flow, financial condition and stock price and ability to fund our operations and satisfy our debt obligations.

Any economic and political uncertainty caused by tariffs posed by the United States on other countries, and any corresponding tariffs from such other countries in response, may negatively impact demand and/or increase the cost for our products and components used in our products and reduce our gross margins.

The current United States administration is pursuing a wide range of monetary, regulatory and trade policies, including the imposition of significant tariffs on certain imports into the United States. Foreign governments, including the Chinese government, have announced their intent to implement or increase tariffs on imports from the United States in response. Certain sourced finished products and certain of the components used in our products are impacted by tariffs imposed on imports as currently in effect. If we are unable to successfully mitigate the impacts of these tariffs and other trade policies, our results of operations, financial condition and cash flows may be materially adversely affected. It remains unclear what the current United States administration or foreign governments will or will not do in the future with respect to tariffs or trade agreements and policies. A trade war, other governmental action related to tariffs or trade agreements, changes in United States social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently purchase, manufacture and sell products and components, and any resulting negative sentiments towards the United States as a result of such changes, could have a material adverse effect on our results of operations, financial condition and cash flows.

Over the past several years we have incurred substantial net losses and negative cash flow. If these trends continue, our liquidity and financial condition will be further materially adversely affected.

We experienced a net loss and negative cash flows in each of the last three fiscal years. There is no guarantee that we will be able to regain or sustain profitability and positive cash flows in the future. Our inability to successfully regain or sustain our profitability and positive cash flows will materially and adversely affect our ability continue our current level of operations and satisfy our debt obligations.

We have a significant amount of goodwill and intangible assets on our balance sheet and our results of operations may be adversely affected if we are required to recognize an impairment charge against our goodwill and intangible assets.

We had goodwill of almost $1~~,484~~.5 ~~thousand~~million and net intangible assets of almost $~~3,379~~2.6 ~~thousand~~million as of March 31, ~~2025~~2026. In accordance with ~~U.S.~~ GAAP, goodwill and intangible assets with an indefinite life are not amortized but are subject to a periodic impairment evaluation. Goodwill and acquired intangible assets with an indefinite life are tested for impairment at least annually or when events and circumstances indicate that fair value of a reporting unit may be below their carrying value. Some factors that could lead to a goodwill impairment assessment would be:

•

our overall financial performance, including continued net losses and low levels of liquidity;

•

a material decline in the price of our common stock;

•

macroeconomic factors;

•

changes in our strategy or exiting a portion of the business;

•

significant adverse changes in demand for our products and services; and

•

related competitive considerations.

We may be required to incur material charges relating to the impairment of those assets. Such impairment charges could materially and adversely affect our business, results of operations and financial condition. In accordance with GAAP, we will continue to test goodwill for impairment at least annually or when events and circumstances trigger the requirement for an interim evaluation.

We are subject to financial and operating covenants in our senior credit agreement, and any failure to comply with such covenants, or obtain waivers in the event of non-compliance, could limit our borrowing availability or result in a default under our senior credit agreement, materially adversely impacting our liquidity. We also will be subject to similar covenants in our anticipated subordinated debt agreement evidencing our Voltrek acquisition earn-out repayment obligations.13

~~Our~~We ~~senior~~are ~~credit~~subject ~~agreement,~~to financial and ~~our~~operating ~~anticipated~~covenants ~~subordinated~~in ~~debt agreement evidencing~~ our ~~Voltrek~~credit ~~acquisition earn-out obligations~~agreement, ~~contains,~~ and ~~will~~any ~~contain,~~failure ~~provisions~~to ~~that~~comply ~~limit~~with ~~our~~such ~~future~~covenants, ~~borrowing~~or ~~availability~~obtain ~~and~~waivers ~~sets~~in ~~forth~~the ~~other~~event ~~customary~~of ~~covenants~~non-compliance, ~~including~~could ~~certain~~limit ~~restrictions on~~ our ~~ability~~borrowing toavailability ~~incur additional indebtedness, consolidate~~ or ~~merge,~~result ~~enter~~in ~~into~~a ~~acquisitions,~~default ~~make~~under ~~investments, pay any dividend or distribution on~~ our ~~stock,~~credit ~~redeem~~agreement, ~~repurchase~~materially oradversely ~~retire~~impacting ~~shares of~~ our ~~stock, or pledge or dispose of assets~~liquidity.

~~There~~Our ~~can~~credit beagreement nocontains ~~assurance~~provisions that welimit ~~will~~our befuture ~~able~~borrowing toavailability ~~comply~~and ~~with~~set ~~the~~forth ~~financial and~~ other ~~covenants~~customary ~~in our senior and anticipated subordinated debt agreements. Our failure to comply with these~~ covenants, ~~could~~including ~~cause~~certain usrestrictions toon beour ~~unable~~ability to ~~borrow~~incur ~~under~~additional ~~the senior credit agreement and may constitute an event of default under our senior and anticipated subordinated debt agreements~~indebtedness, ~~which,~~consolidate ~~if not cured~~ or ~~waived~~merge, ~~could~~enter ~~result~~into inacquisitions, ~~the~~make ~~acceleration~~investments, ofpay ~~the maturity of~~ any ~~indebtedness~~dividend ~~then~~or ~~outstanding~~distribution ~~under~~on our ~~senior and subordinated debt agreements and~~stock, ~~which would require us to pay all amounts then outstanding. Such an event would materially adversely affect our financial condition and liquidity. Additionally~~redeem, ~~such~~repurchase ~~events~~or ofretire ~~non-compliance~~shares ~~could impact the terms~~ of any additional borrowings and/or any credit renewal terms. Any failure to comply with such covenants may be a disclosable event and may be perceived negatively. Such perception could adversely affect the market price for our ~~common~~ stock, ~~and~~or ~~our~~pledge ~~ability~~or todispose ~~obtain~~of ~~financing in the future~~assets.

There can be no assurance that we will be able to comply with the financial and other covenants in our senior debt agreements. Our failure to comply with these covenants could cause us to be unable to borrow under the credit agreement and may constitute an event of default under our senior debt agreements, which, if not cured or waived, could result in the acceleration of the maturity of any indebtedness then outstanding under our senior debt agreements and, which would require us to pay all amounts then outstanding. Such an event would materially adversely affect our financial condition and liquidity. Additionally, such events of non-compliance could impact the terms of any additional borrowings and/or any credit renewal terms. Any failure to comply with such covenants may be a disclosable event and may be perceived negatively. Such perception could adversely affect the market price for our common stock and our ability to obtain financing in the future.

Our net operating loss carry-forwards provide a future benefit only if we regain sustained profitability and may be subject to limitation based upon ownership changes.

We have significant federal net operating loss carry-forwards and state net operating loss carry-forwards. If we are unable to regain sustained profitability, we will not be able to fully utilize these tax benefits. Furthermore, generally a change of more than 50% in the ownership of a company’s stock, by value, over a three-year period constitutes an ownership change for federal income tax purposes. An ownership change may limit a company’s ability to use its net operating loss carry-forwards attributable to the period prior to such change. As a result, our ability to use our net operating loss carry-forwards attributable to the period prior to such ownership change to offset taxable income could be subject to limitations in a particular year, which could potentially result in our increased future tax liability.

Risks Related to Our Common Stock

Our failure to meet the continued listing requirements of NASDAQ may result in the delisting of our common stock on NASDAQ, and we likely will need to seek to effect a reverse stock split of our common stock to avoid delisting by September 15, 2025.

Our common stock is currently listed on NASDAQ, which has qualitative and quantitative listing criteria. On September 20, 2024, we received written notice from NASDAQ that we were not in compliance with NASDAQ’s minimum bid price requirement for continued listing on NASDAQ, as the closing bid price of our common stock had been below $1.00 per share for 30 consecutive trading days. We were granted 180-calendar days, or until March 19, 2025 to regain compliance with the minimum bid price requirement. On March 19, 2025, we submitted a formal request to NASDAQ for an additional 180-calendar day period to regain compliance with the minimum bid price requirement and provided written notice to NASDAQ that we intend to effectuate a reverse stock split during the additional compliance period if necessary to regain compliance with the minimum bid price requirement.

On March 20, 2025, we received a letter from NASDAQ notifying us that we were eligible for an additional 180-calendar day period, or until September 15, 2025, to regain compliance with the minimum bid price requirement. If we do not regain compliance by September 15, 2025, then NASDAQ will notify us of its determination to delist our common stock from trading on NASDAQ. Although we would have an opportunity to appeal the delisting determination to a hearings panel, under NASDAQ rules, our delisting from NASDAQ would be effective on or about September 16, 2025.

We will likely need to seek to effect a reverse stock split of our common stock prior to September 15, 2025 in order to attempt to comply with the NASDAQ minimum bid price requirements. We will likely seek shareholder approval at our 2025 annual meeting of shareholders to allow our Board to implement a reverse stock split. There can be no assurance we will be able to obtain shareholder approval for such a reverse stock split proposal. We may be unable to complete a reverse stock split, and even if we do, we may still be unable to meet the minimum bid price requirement, and we may be unable to meet other applicable NASDAQ listing requirements, including maintaining minimum levels of shareholders’ equity or market values of our common stock.

If NASDAQ delists our common stock from trading on its exchange, we expect our common stock could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:

a limited availability of market quotations for our common stock;

reduced liquidity for our common stock;

a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our common stock;

reduced level of analyst coverage; and

a decreased ability to issue additional securities or obtain additional financing in the future.

Our shareholders may experience substantial dilution in the value of their investment or may otherwise have their interests impaired to the extent we issue additional shares of our common stock.

Our Amended and Restated Articles of Incorporation, as amended, allow us to issue up to ~~230~~50 million shares, consisting of ~~200~~20 million shares of our common stock and 30 million shares of our preferred stock. We may in the future issue additional shares of our common stock or other securities convertible into or exchangeable for our common stock, which could result in substantial dilution to the interests of existing shareholders. For example, on the 14th trading day after we announce our fiscal 2025 financial results, we will issue Final Frontier $1.0 million in shares of our common stock. At our per share price of $0.67 on May 30, 2025, that would result in us issuing approximately 1,492,537 shares of our common stock. Additionally, we have the option to pay up to 20% of the then remaining outstanding balance of our Voltrek earn-out obligations at maturity in shares of our common stock (or over 4% of our currently outstanding common stock).

Additionally, to raise additional capital, we may in the future sell additional shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that are lower than the prices paid by existing shareholders, and investors purchasing shares or other securities in the future could have rights superior to existing shareholders, which could result in substantial dilution to the interests of existing shareholders.

If securities or industry analysts do not continue to publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our common stock may continue to depend, in part, on the research reports that securities or industry analysts publish about us and our peer group companies. If these analysts do not continue to provide adequate research coverage or if one or more of the analysts who covers us downgrades our stock, lowers our stock’s price target or publishes inaccurate or unfavorable research about our business, our stock price would likely decline. ~~For example, if our common stock is delisted from NASDAQ, our analysts may not continue to provide regular reports on our company.~~ If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price and trading volume to decline.

We are not currently paying dividends on our common stock and will likely continue not paying dividends for the foreseeable future.

We have never paid or declared any cash dividends on our common stock. We currently intend to retain all available funds and any future earnings to fund the continued operation of our business and repay our senior debt ~~and anticipated senior subordinated debt~~. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. In addition, the terms of our existing revolving credit agreement ~~and our senior subordinated debt~~ restrict the payment of cash dividends on our common stock. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, contractual restrictions and other factors that our Board deems relevant. The restrictions on, and decision not to, pay dividends on our common stock may impact our ability to attract certain investors and raise funds, if necessary, in the capital markets.

operations, capital requirements, contractual restrictions and other factors that our Board deems relevant. The restrictions on, and decision not to, pay dividends on our common stock may impact our ability to attract certain investors and raise funds, if necessary, in the capital markets.

Anti-takeover provisions included in the Wisconsin Business Corporation Law, provisions in our Amended and Restated Articles of Incorporation or Bylaws could delay or prevent a change of control of our company, which could adversely impact the value of our common stock and may prevent or frustrate attempts by our shareholders to replace or remove our current Board or management.

A change of control of our company may be discouraged, delayed or prevented by certain provisions of the Wisconsin Business Corporation Law. These provisions generally restrict a broad range of business combinations between a Wisconsin corporation and a shareholder owning 15% or more of our outstanding common stock. These and other provisions in our Amended and Restated Articles of Incorporation, including our staggered Board and our ability to issue “blank check” preferred stock, as well as the provisions of our Amended and Restated Bylaws and Wisconsin law, could make it more difficult for shareholders or potential acquirers to obtain control of our Board or initiate actions that are opposed by our then-current Board, including to delay or impede a merger, tender offer or proxy contest involving our company or result in a lower price per share paid to our shareholders.

In addition, our employment arrangements with senior management provide for severance payments and accelerated vesting of benefits, including accelerated vesting of stock options and restricted stock awards, upon a change of control and a subsequent qualifying termination. These provisions could limit the price that investors might be willing to pay in the future for shares of our common stock, thereby adversely affecting the market price of our common stock. These provisions may also discourage or prevent a change of control or result in a lower price per share paid to our shareholders.

The market price of our common stock could be adversely affected by future sales of our common stock in the public market by us or our executive officers and directors.

We and our executive officers and directors may from time to time sell shares of our common stock in the public market or otherwise. We cannot predict the size or the effect, if any, that future sales of shares of our common stock by us or our executive officers and directors, or the perception of such sales, will have on the market price of our common stock.

The price of our common stock has been, and may continue to be, volatile.

Historically, the market price of our common stock has fluctuated over a wide range, and it is likely that the price of our common stock will continue to be volatile in the future. The market price of our common stock could be impacted due to a variety of factors, including:

•

actual or anticipated fluctuations in our operating results or our competitors’ operating results;

•

our ability to achieve our analysts’ results of operations expectations;

•

actual or anticipated changes in the growth rate of the general LED lighting industry, our growth rates or our competitors’ growth rates;

•

conditions in the financial markets in general or changes in general economic conditions;

•

novel and unforeseen market forces and trading strategies;

•

actual or anticipated changes in governmental regulation, including taxation and tariff policies;

•

interest rate or currency exchange rate fluctuations;

•

our ability to forecast or report accurate financial results; and

•

changes in stock market analyst recommendations regarding our common stock, other comparable companies or our industry generally.

Our quarterly revenue and operating results have fluctuated in the past and will likely vary from quarter to quarter in the future. Our results for any particular quarter are not an indication of our future performance. Our revenue and operating results may fall below the expectations of market analysts or investors in some future quarter or quarters. Our failure to meet these expectations could cause the market price of our common stock to decline. If the price of our common stock is volatile or falls significantly, we may be the target of securities litigation or could be delisted from NASDAQ. If we become involved in this type of litigation or are delisted, regardless of the outcome, we could incur substantial legal costs, management’s attention could be diverted from the operation of our business, and our reputation could be damaged, which could adversely affect our results of operations, financial condition and cash flows.

In addition, due to one or more of the foregoing factors in one or more future quarters, our results of operations may fall below the expectations of securities analysts and investors. In the event any of the foregoing occur, the market price of our common stock could be highly volatile and may materially decline.

Operational Risks

Our products use components and raw materials that may be subject to price fluctuations, shortages or interruptions of supply, including semiconductor chips. If we are unable to maintain supply sources of our components and raw materials or if our sources fail to satisfy our supply requirements, we may lose sales and experience increased component costs.

We are vulnerable to price increases, as well as transportation and delivery delays, for components and raw materials that we require for our products, including aluminum, copper, certain rare earth minerals, semiconductor chips, power supplies and LED chips and modules. In particular, we utilize semiconductor chips in our LED lighting products and control sensors. For example, our ability to source semiconductor chips has been adversely affected in the recent past and could occur again. Difficulty in sourcing necessary components in the past has resulted in increased component delivery lead times, delays in our product production and increased costs to obtain components with available semiconductor chips. To the extent a semiconductor chip shortage occurs or our ability to acquire the parts necessary to conduct our business operations, such as other necessary finished goods, is materially affected, our production ability and results of operations will be adversely affected.

Limitations inherent within our supply chain of certain of our components, raw materials and finished goods, including competitive, governmental and legal limitations, natural disasters, and other events, could impact costs and future increases in the costs of these items. For example, the adoption of new tariffs by the United States administration or by other countries could continue to adversely affect our profitability and availability of raw materials and components, as there can be no assurance that future price increases will be successfully passed through to customers or that we will be able to find alternative suppliers. Further, suppliers’ inventories of certain components that our products require may be limited and are subject to acquisition by others and we may not, as a result, have the necessary inventory of parts and goods necessary to conduct our operations. We have in the past purchased excess quantities of certain components critical to our product manufacturing, but there is no guarantee that we will be able to follow or continue to follow this practice in the future. As a result, we have had, and may need to continue, to devote additional working capital to support component and raw material inventory purchases that may not be used over a reasonable period to produce saleable products, and we may be required to increase our excess and obsolete inventory reserves to account for these excess quantities, particularly if demand for our products does not meet our expectations. Also, any further delays, shortages or interruptions in the supply of our components or raw materials could further disrupt our operations. If any of these events occur, our results of operations, financial condition and cash flows could be materially adversely affected.

18Our inability to successfully manage the implementation of a new Enterprise Resource Planning (“ERP”) system may adversely affect our business, results of operations and cash flows and may adversely impact the effectiveness of our internal controls over financial reporting.

~~component~~We ~~and~~are ~~raw~~currently ~~material~~implementing ~~inventory purchases that may not be used over~~ a ~~reasonable~~new ~~period~~ERP tosystem. ~~produce~~ERP ~~saleable~~implementations ~~products,~~are ~~and we may be required to increase our excess and obsolete inventory reserves to account for these excess quantities~~complex, ~~particularly~~labor ~~if demand for our products does not meet our expectations. Also~~intensive, ~~any~~and ~~further~~time-consuming ~~delays~~projects, ~~shortages~~which oralso ~~interruptions~~involve insubstantial ~~the~~expenditures ~~supply~~on ofsystem ~~our~~software ~~components~~and orimplementation ~~raw materials could further disrupt our operations~~activities. IfOur ~~any~~new ofERP ~~these~~system ~~events~~will ~~occur, our results of operations, financial condition and cash flows could~~ be ~~materially adversely affected.~~

important to our ability to provide important information to our management, obtain, and deliver products, provide services and customer support, accurately maintain books and records, provide accurate, timely and reliable reports on our financial and operating results, and otherwise operate our business. ERP implementations also require transformation of business and financial processes in order to reap the benefits of the ERP system. Any such implementation involves risks inherent in the conversion to a new computer system technology solution, including loss of information and potential disruption to our normal operations. The implementation and maintenance of the new ERP system will require the investment of significant financial and human resources, the re-engineering of processes of our business, and the attention of many employees who would otherwise be focused on other aspects of our business. Our results of operations could be adversely affected if we experience time delays or cost overruns during the ERP implementation process, or if we are unable to reap the benefits we expect from the new ERP system. Any material deficiencies in the design and implementation of our new ERP system could also result in potentially materially higher costs and could adversely affect our ability to operate our business and otherwise negatively affect our financial reporting and the effectiveness of our internal control over financial reporting. Any of these consequences could have a material adverse effect on our results of operations, financial condition and cash flows.

The success of our EV segment ultimately depends on consumers’ willingness to adopt electric vehicles in an unstable and changing market.

Our EV segment is highly dependent upon the adoption by consumers of EVs, and we are subject to a risk of any reduced demand for EVs. If the market for EVs does not gain broader market acceptance, develops slower than we expect or faces a setback, our business, prospects, financial condition and operating results will be harmed. The market for alternative fuel vehicles is relatively new, rapidly evolving, characterized by rapidly changing technologies, price competition, additional competitors, evolving government regulation and industry standards, frequent new vehicle announcements, long development cycles for EV original equipment manufacturers, and changing consumer demands and behaviors.

Recent or potential future changes in government and regulatory support for EV adoption, including incentives, mandates, infrastructure investment and emissions regulations and federal funding for EV infrastructure development, may negatively impact the adoption by consumers of EVs. For example, on January 20, 2025, President Trump signed Executive Order 14154 “Unleashing American Energy”, which has had, and may continue to have, direct implications on the policies and regulations that impact the automotive and transportation industries, including the rescission of waivers granted by the EPA for zero emission vehicle regulations. Moreover, federal support for EV adoption generally may be in jeopardy under the current administration, as prior executive orders directing the federal government to transition to an all-electric fleet of cars and trucks have been rescinded. Additionally, the Trump administration ~~has~~ halted significant federal funding for EV infrastructure and ~~has~~ ordered the termination of federal subsidy programs for EVs. While the freeze on federal funding for EV infrastructure has since been lifted, federal subsidy programs for EVs have been terminated. Such disruption, reduction or elimination of governmental support for EV adoption, including any future reduction or elimination in federal funding, for EV infrastructure development, could negatively impact demand for our products and services.

The current administration has also proposed further increases of tariffs on certain foreign imports into the United States. In addition to adversely impacting our ability to source components for our charging network and the cost of such components, new or increased tariffs may also result in a suppressed EV market, fewer EVs on the road and lower demand for EV chargers, which would have an adverse effect on our business, prospects, financial condition and results of operations.

Other factors that may influence the purchase and use of alternative fuel vehicles, specifically EVs, include:

•

perceptions about EV quality, safety (in particular with respect to lithium-ion battery packs), design, performance and cost, especially if adverse events or accidents occur that are linked to the quality or safety of EVs;

•

the limited range over which EVs may be driven on a single battery charge and concerns about running out of power while in use;

•

concerns regarding the stability of the electrical grid;

•

improvements in the fuel economy of the internal combustion engine;

•

consumers’ desire and ability to purchase a luxury automobile or one that is perceived as exclusive;

•

the environmental consciousness of consumers;

•

volatility in the cost of oil and gasoline;

•

consumers’ perceptions of the dependency of the United States on oil from unstable or hostile countries and the impact of international conflicts;

•

government regulations and economic incentives promoting fuel efficiency and alternate forms of energy, or the reduction or elimination thereof;

•

access to charging stations, standardization of EV charging systems and consumers’ perceptions about convenience and cost to charge an EV; and

•

the availability of tax and other governmental incentives to purchase and operate EVs or future regulation requiring increased use of nonpolluting vehicles.

The influence of any of the factors described above may negatively impact the widespread consumer adoption of EVs, which could materially and adversely affect our EV segment business, operating results, financial condition and prospects.

The current administration has paused and rescinded policies relating to investment in EV charging infrastructure, and there is uncertainty over what public policy with respect to EV charging infrastructure will be under the current or future administrations. For example, the current administration has directed agencies to pause disbursement of funds appropriated through two laws signed by the previous administration —- the Inflation Reduction Act and Infrastructure Investment and Jobs Act —- including funding for EV charging stations. The infrastructure law allocated $7.5 billion to building out a network of public plugs across the country. Additionally, spending has been halted under programs such as the National Electric Vehicle Infrastructure (NEVI) program, which provides funding for building out EV charging infrastructure, and prior approvals of funding under the NEVI program have been rescinded. The halt of, and potential elimination of, incentives from the United States Government may decrease demand for, funding of and profitability of EV charging products. In connection with the reduction in incentives for investments in EV charging infrastructure, demand for at home charging products may outpace demand for public charging products, which will adversely impact demand for our products and services.

~~Our~~We ~~inability~~do tonot ~~successfully~~have ~~manage~~major ~~the~~sources ~~implementation~~of recurring revenue, a substantial portion of our revenues are derived from project-based work that is awarded through a ~~new~~competitive ~~Enterprise~~bid ~~Resource~~process ~~Planning~~and ~~(“ERP”)~~we ~~system~~depend ~~may~~upon ~~adversely~~a ~~affect~~limited number of customers in any given period to generate a substantial portion of our ~~business~~revenue. The reduction of revenue from our most significant customer over the past several fiscal years has had, and the potential future loss of other significant customers or a major customer would likely have, a materially adverse effect on our results of operations, financial condition and cash flows, and ~~may~~it ~~adversely~~is ~~impact~~generally difficult to predict the ~~effectiveness~~timing and success rate of ~~our~~the ~~internal~~projects ~~controls~~that ~~over~~we ~~financial~~bid ~~reporting~~and will be awarded.

WeA ~~are~~substantial ~~currently~~portion ~~implementing~~of aour ~~new~~revenues ~~ERP system. ERP implementations~~ are ~~complex,~~derived ~~labor~~from ~~intensive, and time~~project-~~consuming~~based ~~projects,~~work ~~which~~that ~~also~~is ~~involve~~awarded ~~substantial~~through ~~expenditures~~a oncompetitive ~~system~~bid ~~software and implementation activities~~process. ~~The~~It ~~new~~is ~~ERP~~generally ~~system~~difficult ~~will be important~~ to ~~our~~predict ~~ability~~the totiming ~~provide~~and ~~important~~success ~~information~~rate toof ~~our~~the ~~management,~~projects ~~obtain,~~that ~~and~~we ~~deliver~~bid ~~products, provide services~~ and ~~customer~~will ~~support,~~be ~~accurately~~awarded. ~~maintain~~In ~~books~~prior ~~and~~fiscal ~~records~~years, ~~provide~~one ~~accurate,~~customer ~~timely~~represented ~~and~~more ~~reliable~~than ~~reports~~40% onof ~~our~~total ~~financial and operating results~~revenues, ~~and~~which ~~otherwise~~has ~~operate~~not ~~our~~recurred ~~business. ERP implementations also require transformation of business and financial processes~~ in ~~order~~recent tofiscal ~~reap~~years. ~~the~~The ~~benefits~~reduction of ~~the~~revenue ~~ERP~~from ~~system.~~this ~~Any~~customer ~~such~~has ~~implementation~~had ~~involves risks inherent in the conversion to~~ a ~~new~~material ~~computer~~adverse ~~system~~effect ~~technology~~on ~~solution, including loss of information and potential disruption to~~ our ~~normal~~results ~~operations. The implementation and maintenance~~ of ~~the new ERP system will require~~operations, ~~the investment of significant~~ financial ~~and~~condition ~~human resources, the re-engineering of processes of our business,~~ and ~~the~~cash ~~attention~~flow. ofWhile ~~many~~this ~~employees~~customer ~~who~~continues ~~would~~to ~~otherwise~~ be ~~focused~~a onsubstantial ~~other~~source ~~aspects~~ of ~~our~~ business. ~~Our~~for ~~results~~us (26.0% of ~~operations~~our ~~could~~fiscal be2026 ~~adversely~~revenue), ~~affected if~~ we ~~experience~~continue ~~time~~to ~~delays~~attempt orto ~~cost~~diversify ~~overruns~~our ~~during~~customer ~~the~~base ~~ERP~~and ~~implementation~~expand ~~process,~~our orreach ~~if we are unable~~ to ~~reap~~national ~~the~~accounts, ~~benefits~~ESCOs, ~~we expect from~~ the ~~ERP~~agent ~~system.~~driven ~~Any~~distribution ~~material~~channel, ~~deficiencies~~lighting inmaintenance ~~the~~customers ~~design~~ and ~~implementation of~~ the ~~new~~EV ~~ERP~~market, ~~system~~there ~~could~~is ~~also~~no ~~result~~assurance inwe ~~potentially~~will ~~materially~~be ~~higher~~successful ~~costs~~in ~~and~~replacing ~~could~~this ~~adversely~~reduced ~~affect~~revenue. ~~our~~Additionally, ~~ability~~even toas ~~operate~~we ~~our~~progress ~~business~~toward ~~and~~diversifying ~~otherwise negatively affect~~ our ~~financial~~customer ~~reporting~~base, ~~and~~timing ~~the effectiveness~~ of ~~our~~execution ~~internal control over financial reporting. Any of these consequences could have a material adverse effect~~ on ~~our~~projects ~~results~~with ofnew ~~operations,~~or ~~financial~~additional ~~condition~~customers ~~and~~is ~~cash flows~~unpredictable.

We do not have major sources of recurring revenue, and we depend upon a limited number of customers in any given period to generate a substantial portion of our revenue. The reduction of revenue from our most significant customer over the past several fiscal years has had, and the potential future loss of other significant customers or a major customer would likely have, a materially adverse effect on our results of operations, financial condition and cash flows.

A substantial portion of our revenues are derived from project-based work that is awarded through a competitive bid process. It is generally difficult to predict the timing and success rate of the projects that we bid and will be awarded. In prior fiscal years, one customer represented more than 40% of total revenues, which has not recurred in recent fiscal years. The reduction of revenue from this customer has had a material adverse effect on our results of operations, financial condition and cash flow. While this customer continues to be a substantial source of business for us (24.3% of our fiscal 2025 revenue), we continue to attempt to diversify our customer base and expand our reach to national accounts, ESCOs, the agent driven distribution channel, lighting maintenance customers and the EV market, there is no assurance we will be successful in replacing this reduced revenue. Additionally, even as we progress toward diversifying our customer base, timing of execution on projects with new or additional customers is unpredictable.

Our ability to achieve our desired revenue and profitability goals depends on our ability to effectively and timely execute on our key strategic initiatives.

Our ability to achieve our desired revenue and profitability goals depends on how effectively and timely we execute on our following key strategic initiatives:

•

executing and marketing our turnkey LED retrofit capabilities to large national account customers;

•

continuing our product innovation;

•

leveraging our smart lighting systems to support IoT applications;

•

expanding our EV charging business, including increasing cross selling our EV charging solutions to our historical sales channels and customers;

•

further developing and maintaining our maintenance service offerings; and

•

supporting the success of our ESCO and distribution sales channels.

There can be no assurance that we will be able to successfully implement these initiatives or, even if implemented, that they will result in the anticipated benefits to our business.

If our information technology systems security measures are breached or fail, our products may be perceived as not being secure, customers may curtail or stop buying our products, we may incur significant legal and financial exposure, and our results of operations, financial condition and cash flows could be materially adversely affected.

Our information technology systems involve the storage of our confidential information and trade secrets, as well as our customers’ personal and proprietary information in our equipment, networks and corporate systems. Security breaches, including cybersecurity breaches, expose us to a risk of loss of this information, litigation and increased costs for security measures, loss of revenue, damage to our reputation and potential liability. Security breaches or unauthorized access may result in a combination of significant legal and financial exposure, increased remediation and other costs, theft and/or unauthorized use or publication of our trade secrets and other confidential business information, damage to our reputation and a loss of confidence in the security of our products, services and networks that could have an adverse effect upon our business. While we take steps to prevent unauthorized access to our corporate systems, because the techniques used to obtain unauthorized access, disable or sabotage systems change frequently or may be designed to remain dormant until a triggering event, we may be unable to anticipate these techniques or implement adequate preventative measures. Further, the risk of a security breach or disruption, particularly through cyber attacks, or cyber intrusion, including by computer hackers, foreign governments, and cyber terrorists, has generally increased as cyber attacks have become more prevalent and harder to detect and fight against. In addition, hardware, software or applications we procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise network and data security. Any breach or failure of our information technology systems could result in decreased revenue, increased expenses, increased capital expenditures, customer dissatisfaction and potential lawsuits, any of which could have a material adverse effect on our results of operations, financial condition and cash flows.

We increasingly rely on third-party manufacturers for the manufacture and development of our products and product components.

We have increased our utilization of third-party manufacturers for the manufacture and development of our products and product components, some of which are located overseas. Our results of operations, financial condition and cash flows could be materially adversely affected if our third-party manufacturers were to experience problems with product quality, credit or liquidity issues, or supply chain and logistics that could cause delays in delivery of the finished products and components or the raw materials used to make such products and components.

Legal, Regulatory and Compliance Risks

Government tariffs and other actions have adversely affected, and may continue to adversely affect, our business.

The United States government has, from time to time, implemented various monetary, regulatory, and trade importation restraints, penalties, and tariffs, and as a result of changes to United States and foreign government administrative policy, there may be changes to existing trade agreements, greater restrictions on free trade generally, the imposition of or significant increases in tariffs on goods imported into the United States, and adverse responses by foreign governments to United States trade policies, among other possible changes. The current United States administration is pursuing a wide range of monetary, regulatory and trade policies, including the imposition of significant tariffs on certain imports into the United States. Foreign governments, including the Chinese government, have announced their intent to implement or increase tariffs on imports from the United States in response. Certain sourced finished products

2119

~~announced their intent to implement or increase tariffs on imports from the United States in response. Certain sourced finished products~~ and certain of the components used in our products have been impacted by tariffs imposed on imports. Our efforts to mitigate the impact of added costs resulting from these government actions include a variety of activities, such as sourcing from non-tariff impacted countries and raising prices. We intend to implement such changes to try to pass the impact of tariff price increases to our customers, but there can be no assurance our customers will accept such price increases or that such price increases will not reduce or ability to gain new orders. If we are unable to successfully mitigate the impacts of these tariffs and other trade policies, our results of operations may be adversely affected. It remains unclear what the current United States administration or foreign governments will or will not do in the future with respect to tariffs or trade agreements and policies. A trade war, other governmental action related to tariffs or trade agreements, changes in United States social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where we currently purchase, manufacture and sell products, and any resulting negative sentiments towards the United States as a result of such changes, could have a material adverse effect on our results of operations, financial condition and cash flows.

Changes in government budget priorities, including the rollback of ~~electric~~EV ~~vehicle~~ initiatives, political gridlock, and future potential government shutdown, have negatively impacted, and may in the future continue to negatively impact, our results of operations, financial condition and cash flows.

Our business strategy may rely, in part, on regulatory support for EV adoption, including incentives, mandates, infrastructure investment and emissions regulations and federal funding for EV infrastructure development. However, on January 20, 2025, President Trump signed Executive Order 14154 “Unleashing American Energy”, which has had, and may continue to have, direct implications on the policies and regulations that impact the automotive and transportation industries, including the rescission of waivers granted by the EPA for zero emission vehicle regulations. Moreover, federal support for EV adoption generally may be in jeopardy under the current administration, as prior executive orders directing the federal government to transition to an all-electric fleet of cars and trucks have been rescinded. Additionally, the Trump administration ~~has~~temporarily halted significant federal funding for EV infrastructure and ~~has~~successfully ordered the termination of federal subsidy programs for EVs.

Such disruption, reduction or elimination of governmental support for EV adoption, including any future reduction or elimination of federal funding, for EV infrastructure development, could negatively impact demand and payment for our products and services, hinder our growth initiatives and materially affect our results of operations, financial condition and cash flows.

Additionally, future actual and perceived changes in governmental budget priorities, and future potential government shutdowns, could adversely affect our results of operations, financial condition and cash flows. Certain government agencies purchase certain products and services directly from us. When the government changes budget priorities, such as in times of war, financial crisis, or a changed administration, or reallocates spending to areas unrelated to our business, our results of operations, financial condition and cash flows can be negatively impacted. For example, demand and payment for our products and services may be affected by public sector budgetary cycles, funding authorizations or rebates. Continued or additional future funding reductions or delays, including delays caused by political gridlock, and future potential government shutdowns, could negatively impact demand and payment for our products and services. If any of these events occur, our results of operations, financial condition and cash flows could be materially adversely affected.

The reduction or elimination of investments in, or incentives to adopt, LED lighting or the elimination of, or changes in, policies, incentives or rebates in certain states or countries that encourage the use of LEDs over some traditional lighting technologies could cause the growth in demand for our products to slow, which could have a material adverse effect on our results of operations, financial condition and cash flows.

Reductions in (including as a result of any budgetary constraints), or the elimination of, government investment and favorable energy policies designed to accelerate the adoption of LED lighting could result in decreased demand for our products and adversely affect our results of operations, financial condition and cash flows. Further, if our products fail to qualify for any financial incentives or rebates provided by governmental agencies or utilities for which our competitors’ products qualify, such programs may diminish or eliminate our ability to compete by offering products at lower prices than ours.

Strategic Risks

We are experiencing ongoing increasing pressures to reduce the average selling price of our products and related negative impact on our gross margins driven largely by the ongoing increase in competition from foreign competitors.

Our financial performance is dependent on our ability to maintain our average selling price of our products. The gross margins of our products can vary significantly, with margins ranging from 10% to 50%. While we continue to implement our strategy of emphasizing higher-margin products and services and reducing the material cost of our products, a change in the total mix of our sales toward lower margin products, the continued underutilization of our manufacturing facility and related under absorption of overhead costs, a decrease in the margins on our products as a result of competitive pressures driving down the average selling price of our products, lower sales volumes, and promotional programs to increase sales volumes significantly reduce our profitability and result in a material adverse effect on our results of operations, financial condition and cash flows. Furthermore, the average selling price of our products has been, and is likely to be further, negatively impacted by the impact of increasing foreign competition, the potential impact of tariffs or our component costs, product feature cannibalization by competitors or component providers, low-cost non-traditional sales methods by new market entrants, and comparison of our retrofit fixture products with replacement lamp equivalents. While we have previously implemented general price increases applicable to many new product orders, there is no assurance that such price increases will be accepted by our customers or succeed in increasing the average selling price of our products. In our highly competitive lighting industry, we must be able to innovate and release new products on a regular basis with features and benefits that generate increases in our average selling price and average gross margin. There can be no assurance we will be successful in achieving these goals.

If we are unable to attract, incentivize and retain our third-party distributors ~~and sales agents~~, or our distributors ~~and sales agents~~ do not sell our products and services at the levels expected, our revenues could decline and our costs could increase.

We ~~utilize manufacturer representative sales agencies that~~ sell our products through distributors. Many of these ~~sales agents and~~ distributors are not exclusive, which means that these ~~sales agents and~~ distributors may sell other third-party products and services in direct competition with us. Since many of our competitors use ~~sales agents and~~ distributors to sell their products and services, competition for such ~~agents and~~ distributors is intense and may adversely affect our product pricing and gross margins. Additionally, due to mismanagement, industry trends, macro-economic developments, or other reasons, our ~~sales agents and~~ distributors may be unable to effectively sell our products at the levels desired or anticipated. In addition, we have historically relied on direct sales to sell our products and services, which were often made in competition with sales agents and distributors. In order to attract and form lasting partnerships with sales agents and distributors, we are attempting to overcome our historical perception as a direct sales competitor. As a result, we may have difficulty attracting and retaining sales agents and distributors and any inability to do so could have a negative effect on our ability to attract and obtain customers, which could have an adverse impact on our business.

The success of our LED lighting retrofit solutions depends, in part, on our ability to claim market share away from our competitors. If we are unable to expand our customer base and increase sales in our targeted markets, our results of operations, financial condition and cash flows will likely be materially adversely affected.

Participants in the LED market who are able to quickly establish customer relationships and achieve market penetration are likely to gain a competitive advantage as the lighting retrofit solutions offered by us and our competitors generally have a product life of several years following installation. If we are unable to broaden our customer base and achieve greater market penetration in the LED market in a timely manner, we may lose the opportunity to market our LED products and services to significant portions of the lighting systems retrofit market for several years and may be at a disadvantage in securing future business opportunities from customers that have previously established relationships with one or more of our competitors. These circumstances could have a material adverse effect on our results of operations, financial condition and cash flows.

In addition, as we continue to seek to expand our customer base within our national account, agent and ESCO sales channels, our success will depend, in part, on our ability to attract and retain talent to execute on our sales model. If we are unable to attract and retain sufficient talent, we may be unable to broaden our customer base, which will adversely affect our results of operations, financial condition and cash flows.

General Risk Factors

Our operations and financial performance are impacted by worldwide economic conditions. Uncertainty about global economic conditions has contributed to customers postponing purchases of our products and services in response to tighter credit, unemployment, negative financial news and/or declines in income or asset values and other macroeconomic factors. The occurrence of these 21

23Our operations and financial performance are impacted by worldwide economic conditions. Uncertainty about global economic conditions has contributed to customers postponing purchases of our products and services in response to tighter credit, unemployment, negative financial news and/or declines in income or asset values and other macroeconomic factors. The occurrence of these circumstances will likely have a material negative effect on demand for our products and services and, accordingly, on our results of operations, financial condition and cash flows.

circumstances will likely have a material negative effect on demand for our products and services and, accordingly, on our results of operations, financial condition and cash flows.

In addition, global economic and political uncertainty has led many customers to adopt strategies for conserving cash, including limits on capital spending. Our lighting systems are often purchased as capital assets and therefore are subject to our customers’ capital availability. Uncertainty around such availability and an increasingly volatile economic outlook has led, and may continue to lead, customers to delay their purchase decisions, which has elongated the duration of our sales cycles. Additionally, price increases in raw materials, including steel and aluminum, may impact non-residential new build schedules, and may reduce demand for our products and services. Weak economic conditions in the past have adversely affected our customers’ capital budgets, purchasing decisions and facilities managers and, as a result, have adversely affected our results of operations, financial condition and cash flows. The return to a recessionary state of the global economy could potentially have negative effects on our near-term liquidity and capital resources, including slower collections of receivables, delays of existing order deliveries, postponements of incoming orders and reductions in the number and volume of purchase orders received from key customers as a result of reduced capital expenditure budgets. Our business and results of operations will be adversely affected to the extent these adverse economic conditions affect our customers’ purchasing decisions.

The price of our common stock has been, and may continue to be, volatile.

actual or anticipated fluctuations in our operating results or our competitors’ operating results;

our ability to achieve our analysts’ results of operations expectations;

actual or anticipated changes in the growth rate of the general LED lighting industry, our growth rates or our competitors’ growth rates;

conditions in the financial markets in general or changes in general economic conditions;

novel and unforeseen market forces and trading strategies;

actual or anticipated changes in governmental regulation, including taxation and tariff policies;

interest rate or currency exchange rate fluctuations;

our ability to forecast or report accurate financial results; and

changes in stock market analyst recommendations regarding our common stock, other comparable companies or our industry generally.

Our quarterly revenue and operating results have fluctuated in the past and will likely vary from quarter to quarter in the future. Our results for any particular quarter are not an indication of our future performance. Our revenue and operating results may fall below the expectations of market analysts or investors in some future quarter or quarters. Our failure to meet these expectations could cause the market price of our common stock to further decline. If the price of our common stock is volatile or falls significantly, including following a potential reverse stock split, we may be the target of securities litigation or could be delisted from NASDAQ. If we become involved in this type of litigation or are delisted, regardless of the outcome, we could incur substantial legal costs, management’s attention could be diverted from the operation of our business, and our reputation could be damaged, which could adversely affect our results of operations, financial condition and cash flows.

Our inability to attract and retain key employees, our reseller network members or manufacturer representative agencies could adversely affect our operations and our ability to execute on our operating plan and growth strategy.

We rely upon the knowledge, experience and skills of key employees throughout our organization, particularly our senior management team, our sales group that requires technical knowledge or contacts in, and knowledge of, the LED industry, and our innovation and engineering team. In addition, our ability to attract talented new employees, particularly in our sales group and our innovation and engineering team, is also critical to our success. We also depend on our distribution channels and network of manufacturer sales representative agencies. If we are unable to attract and retain key employees, resellers, and manufacturer sales representative agencies because of competition or, in the case of employees, inadequate compensation or other factors, our results of operations and our ability to execute our operating plan could be adversely affected.

innovation and engineering team. In addition, our ability to attract talented new employees, particularly in our sales group and our innovation and engineering team, is also critical to our success. We also depend on our distribution channels and network of manufacturer sales representative agencies. If we are unable to attract and retain key employees, resellers, and manufacturer sales representative agencies because of competition or, in the case of employees, inadequate compensation or other factors, our results of operations and our ability to execute our operating plan could be adversely affected.

The success of our business depends upon market acceptance of our energy management products and services.

Our future success depends upon the continued market acceptance of our energy management products and services and obtaining additional project management retrofit contracts, as well as customer orders for new and expanded products and services to supplement our contract with our current single largest customer. If we are unable to convince current and potential new customers of the advantages of our lighting systems and energy management products and services, or our expanded product and services offerings, then our results of operations, financial condition and cash flows will likely be materially adversely affected. In addition, because the market for energy management products and services, as well as potential new customer uses for our products and services, is rapidly evolving, we may not be able to accurately assess the size of the market, and we may have limited insight into trends that may emerge and affect our business. If the market for our lighting systems and energy management products and services, as well as potential new customer uses for our products and services, does not continue to develop as we anticipate, or if the market does not accept our products or services, then our ability to grow our business could be limited and we may not be able to increase our revenue and our results of operations, financial condition and cash flows will likely be materially adversely affected.

Macroeconomic pressures in the markets in which we operate or anticipate operating in the future may adversely affect our financial results.

Geopolitical issues around the world can impact macroeconomic conditions in where we operate and where we anticipate operating in the future and could have a material adverse impact on our financial results. For example, the ultimate impact of the conflicts in Ukraine and the Middle East on fuel prices, inflation, the global supply chain and other macroeconomic conditions is unknown and could materially adversely affect global economic growth, disrupting discretionary spending habits and generally decreasing demand for our products and services. While we do not purchase any of our significant raw materials directly from Russia or Israel, disruption ~~in the markets resulting from such conflicts could negatively impact the macroeconomy. The conflicts in Ukraine and the Middle East may also continue to exacerbate geopolitical tensions globally.~~

in the markets resulting from such conflicts could negatively impact the macroeconomy. The conflicts in Ukraine and the Middle East may also continue to exacerbate geopolitical tensions globally.

We operate in a highly competitive industry and, if we are unable to compete successfully, our results of operations, financial condition and cash flows will likely be materially adversely affected.

We face strong competition, primarily from manufacturers and distributors of energy management products and services, as well as from ESCOs and electrical contractors. We are also facing increased competition from manufacturers in low-cost countries as the lighting market rapidly moves away from domestically made products toward sourced products at lower price points. We compete primarily on the basis of customer relationships, price, quality, energy efficiency, customer service and marketing support. Our products are in direct competition with the expanding availability of LED products, as well as other technologies in the lighting systems retrofit market.

Many of our competitors are better capitalized than we are and have strong customer relationships, greater name recognition, and more extensive engineering, manufacturing, sales and marketing capabilities. In addition, the LED market has seen increased convergence in recent years, resulting in our competition gaining increased market share and resources. Competitors could focus their substantial resources on developing a competing business model or energy management products or services that may be potentially more attractive to customers than our products or services. In addition, we may face competition from other products or technologies that reduce demand for electricity. Our competitors have, and may continue to, offer energy management products and services at reduced prices in order to improve their competitive positions. These competitive factors have, and may continue to, make it more difficult for us to attract and retain customers, or require us to lower our average selling prices in order to remain competitive, any of which could have a material adverse effect on our results of operations, financial condition and cash flows.

If we fail to establish and maintain effective internal controls over financial reporting, our business and financial results could be harmed.

Our management is responsible for establishing and maintaining effective internal control over financial reporting. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of financial reporting for external purposes in accordance with accounting principles generally accepted in the United States. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that we would prevent or detect a misstatement of our consolidated financial statements or fraud. A failure to maintain an effective system of internal control over financial reporting could limit our ability to report our financial results accurately and in a timely manner or to detect and prevent fraud, could result in a restatement of our consolidated financial statements, and could also cause a loss of investor confidence and decline in the market price of our common stock.

Our retrofitting process frequently involves responsibility for the removal and disposal of components containing hazardous materials.

When we retrofit a customer’s facility, we typically assume responsibility for removing and disposing of its existing lighting fixtures. Certain components of these fixtures typically contain trace amounts of mercury and other hazardous materials. Older components may also contain trace amounts of polychlorinated biphenyls, or PCBs. We currently rely on contractors to remove the components containing such hazardous materials at the customer job site. The contractors then arrange for the disposal of such components at a licensed disposal facility. Failure by such contractors to remove or dispose of the components containing these hazardous materials in a safe, effective and lawful manner could give rise to liability for us, or could expose our workers or other persons to these hazardous materials, which could result in claims against us which may have a material adverse effect on our results of operations, financial condition and cash flows.

Product liability claims could adversely affect our business, results of operations and financial condition.

We face exposure to product liability claims in the event that our energy management products fail to perform as expected or cause bodily injury or property damage. Since virtually all of our products use electricity, it is possible that our products could result in injury, whether by product malfunctions, defects, improper installation or other causes. Particularly because our products often incorporate new technologies or designs, we cannot predict whether or not product liability claims will be brought against us in the future or result in negative publicity about our business or adversely affect our customer relations. Moreover, we may not have adequate resources in the event of a successful claim against us. A successful product liability claim against us that is not covered by insurance or is in excess of our available insurance limits could require us to make significant payments of damages and could materially adversely affect our results of operations, financial condition and cash flows.

technologies or designs, we cannot predict whether or not product liability claims will be brought against us in the future or result in negative publicity about our business or adversely affect our customer relations. Moreover, we may not have adequate resources in the event of a successful claim against us. A successful product liability claim against us that is not covered by insurance or is in excess of our available insurance limits could require us to make significant payments of damages and could materially adversely affect our results of operations, financial condition and cash flows.

Our inability to protect our intellectual property, or our involvement in damaging and disruptive intellectual property litigation, could adversely affect our results of operations, financial condition and cash flows or result in the loss of use of the related product or service.

We attempt to protect our intellectual property rights through a combination of patent, trademark, copyright and trade secret laws, as well as employee and third-party nondisclosure and assignment agreements. Our failure to obtain or maintain adequate protection of our intellectual property rights for any reason could have a material adverse effect on our results of operations, financial condition and cash flows.

We own United States patents and patent applications for some of our products, systems, business methods and technologies. We offer no assurance about the degree of protection which existing or future patents may afford us. Likewise, we offer no assurance that our patent applications will result in issued patents, that our patents will be upheld if challenged, that competitors will not develop similar or superior business methods or products outside the protection of our patents, that competitors will not infringe upon our patents, or that we will have adequate resources to enforce our patents. Effective protection of our United States patents may be unavailable or limited in jurisdictions outside the United States, as the intellectual property laws of foreign countries sometimes offer less protection or have onerous filing requirements. In addition, because some patent applications are maintained in secrecy for a period of time, we could adopt a technology without knowledge of a pending patent application, and such technology could infringe a third party’s patent.

We also rely on unpatented proprietary technology. It is possible that others will independently develop the same or similar technology or otherwise learn of our unpatented technology. To protect our trade secrets and other proprietary information, we generally require employees, consultants, advisors and collaborators to enter into confidentiality agreements. We cannot assure you that these agreements will provide meaningful protection for our trade secrets, know-how or other proprietary information in the event of any unauthorized use, misappropriation or disclosure of such trade secrets, know-how or other proprietary information. If we are unable to maintain the proprietary nature of our technologies, our business could be materially adversely affected.

We rely on our trademarks, trade names, and brand names to distinguish our company and our products and services from our competitors. Some of our trademarks may conflict with trademarks of other companies. Failure to obtain trademark registrations could limit our ability to protect our trademarks and impede our sales and marketing efforts. Further, we cannot assure you that competitors will not infringe our trademarks, or that we will have adequate resources to enforce our trademarks.

In addition, third parties have brought, and may bring future, infringement and other claims that could be time-consuming and expensive to defend. Also, parties making infringement and other claims against us may be able to obtain injunctive or other equitable relief that could effectively block our ability to provide our products, services or business methods and could cause us to pay substantial damages. In the event of a successful claim of infringement against us, we may need to obtain one or more licenses from third parties, which may not be available at a reasonable cost, or at all. It is possible that our intellectual property rights may not be valid or that we may infringe upon existing or future proprietary rights of others. Any successful infringement claims could subject us to significant liabilities, require us to seek licenses on unfavorable terms, prevent us from manufacturing or selling products, services and business methods and require us to redesign or, in the case of trademark claims, re-brand our company or products, any of which could have a material adverse effect on our results of operations, financial condition and cash flows.

The cost of compliance with environmental laws and regulations and any related environmental liabilities could adversely affect our results of operations, financial condition and cash flows.

Our operations are subject to federal, state and local laws and regulations governing, among other things, emissions to air, discharge to water, the remediation of contaminated properties and the generation, handling, storage, transportation, treatment and disposal of, and exposure to, waste and other materials, as well as laws and regulations relating to occupational health and safety. These laws and regulations frequently change, and the violation of these laws or regulations can lead to substantial fines, penalties and other liabilities. The operation of our manufacturing facility entails risks in these areas and there can be no assurance that we will not incur material costs or liabilities in the future that could adversely affect our results of operations, financial condition and cash flows

regulations frequently change, and the violation of these laws or regulations can lead to substantial fines, penalties and other liabilities. The operation of our manufacturing facility entails risks in these areas and there can be no assurance that we will not incur material costs or liabilities in the future that could adversely affect our results of operations, financial condition and cash flows.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 1C. CYBERSECURITY

Our Board and Audit and Finance Committee oversee risks from cybersecurity threats. Our Audit and Finance Committee reviews cybersecurity risks on a quarterly basis and our Board periodically reviews cybersecurity risks as part of its overall risk management oversight and specifically reviews cybersecurity in detail at least annually. Our Board relies on management and its use of ~~the~~ third-party consultants for expertise for assessing and managing our risks from cybersecurity threats. In conjunction with management, our Board considers the nature of the work provided by our operations, the potential impact of a cybersecurity event, costs, potential likelihood of an event, prior events, and benefits in its general oversight of the cybersecurity risk management.

We have experienced targeted and non-targeted cybersecurity attacks and incidents in the past that have resulted in unauthorized persons gaining limited access to our information and systems, and we could in the future experience similar attacks. To date, no cybersecurity incident or attack, or any risk from cybersecurity threats, has materially affected or has been determined to be reasonably likely to materially affect us or our business strategy, results of operations, or financial condition.

See also “Item 1A. Risk Factors — Operational Risks.”

ITEM 2. PROPERTIES

We lease our approximately 266,000 square foot manufacturing and distribution facility located in Manitowoc, Wisconsin~~. On January 31~~, ~~2020, we entered a new lease for~~ the ~~facility with a ten-year~~ term, of which ~~had~~lease anexpires ~~option to terminate that expired~~ on January 31, ~~2025~~2030.

We own our approximately 70,000 square foot technology center and corporate headquarters adjacent to our leased Manitowoc manufacturing and distribution facility. We also lease approximately 10,500 square feet of office space in Jacksonville, Florida and 5,375 square feet in Lawrence, Massachusetts. ~~Additionally, Orion had a lease in Pewaukee, Wisconsin that ended in August of the current fiscal year.~~

The Manitowoc and Jacksonville facilities noted above are utilized by all our business segments and the Lawrence facility by our EV segment.

ITEM 3. LEGAL PROCEEDINGS

We are subject to various claims and legal proceedings arising in the ordinary course of business. As of the date of this report, we do not believe that the final resolution of any of such claims or legal proceedings would have a material adverse effect on our future results of operations.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Shares of our common stock are traded on the NASDAQ Capital Market under the symbol “OESX”.

Shareholders

As of May 3129, ~~2025~~2026, there were approximately ~~152~~145 record holders of the 334,~~305~~056,~~699~~528 outstanding shares of our common stock. The number of record holders does not include shareholders for whom shares are held in a “nominee” or “street” name.

Dividend Policy

We have never paid or declared any cash dividends on our common stock. We currently intend to retain all available funds and any future earnings to fund the development and expansion of our business, and we do not anticipate paying any cash dividends in the foreseeable future. In addition, the terms of our existing ~~senior~~ credit agreement restrict the payment of cash dividends on our common stock. ~~It is expected that our anticipated subordinated debt agreement evidencing our Voltrek earn-out payment obligations will contain a similar restriction.~~ Any future determination to pay dividends will be at the discretion of our Board and will depend on our financial condition, results of operations, capital requirements, contractual restrictions (including those under our loan agreements) and other factors that our Board deems relevant.

Securities Authorized for Issuance under Equity Compensation Plans

The following table represents shares outstanding under our 2016 Omnibus Incentive Plan as of March 31, ~~2025~~2026.

Equity Compensation Plan Information

Plan Category

Number ofShares to beIssued ~~UponVesting~~UponExercise ofOutstandingOptions andVesting ofRestrictedShares

WeightedAverageExercise Price ofOutstandingOptions

Number ofSharesRemainingAvailable forFuture IssuancesUnder Equity Compensation Plans (excluding Securities ~~Refleted~~Reflected in Column (a)

(a)

(b)

(c)

Equity Compensation plans approved by security holders

2188,~~861,530~~372

—6.34

~~219~~56,~~782~~587

Equity Compensation plans not approved by security holders

—

Total

2188,~~861,530~~372

—6.34

~~219~~56,~~782~~587

Issuer Purchase of Equity Securities

We did not purchase shares of our common stock during the fiscal year ended March 31, ~~2025~~2026.

Unregistered Sales of Securities

WeOn ~~did~~July ~~not~~16, ~~effect~~2025, ~~any~~we ~~unregistered~~issued ~~sales~~163,258 shares of our common stock ~~during~~to Kathleen M. Connors and 1,649 shares of our common stock to the ~~fiscal~~Kathleen ~~year~~M. ~~ended~~Connors ~~March~~2019 31Revocable Trust as earnout consideration as contemplated by the Term Sheet. These issuances did not involve a public offering and were exempt from registration under Section 4(a)(2) of the Securities Act of 1933, ~~2025~~as amended (the “Securities Act”).

On July 18, 2025, we granted the following equity awards to Michael Ontrop, our new Senior Vice president of Channel Sales, as inducement for employment; (i) 10,000 shares of restricted stock and (ii) a non-qualified stock option exercisable for 12,500 shares of our common stock at an exercise price of $6.00 per share. These awards were exempt from registration under Section 4(a)(2) of the Securities Act. The equity awards were approved by our Board in accordance with Nasdaq Listing Rule 5635(c)(4) as a material

inducement for Mr. Ontrop to accept our offer of employment, and the underlying shares were not drawn from the Orion Energy Systems, Inc. 2016 Omnibus Incentive Plan.

Mr. Ontrop’s restricted stock award will vest with respect to one-third of the restricted shares on each of the first three anniversaries of the grant date, provided that Mr. Ontrop is then still employed with the Company on the applicable vesting date. Mr. Ontrop's stock option will vest as follows if the per share price of our common stock achieves the following levels over the three-year period after the grant date and provided Mr. Ontrop is then still employed by us on the applicable vesting date: (i) one-third at $30.00; (ii) one-third at $40.00; and (iii) one-third at $50.00, with achievement of the effective share prices to be determined based on a five trading day average closing price of our common stock.

ITEM 6. [RESERVED]

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

~~The~~This ~~following~~section ~~discussion~~of this Form 10-K generally discusses fiscal year 2026 and ~~analysis~~fiscal ofyear ~~our~~2025 ~~financial~~items ~~condition~~and year over year comparisons between fiscal year 2026 and ~~results~~fiscal year 2025. Discussions of ~~operations~~the ~~should~~fiscal beyear ~~read~~2024 ~~together~~items ~~with~~and ~~our~~the ~~audited~~year ~~consolidated~~over ~~financial~~year ~~statements~~comparisons between fiscal year 2025 and ~~related~~fiscal ~~notes~~year 2024 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2025. ~~See also “Forward-Looking Statements” and Item 1A “Risk Factors”.~~

Overview

We provide state-of-the-art light emitting diode (“LED”) lighting systems, wireless Internet of Things (“IoT”) enabled control solutions, project engineering, energy project management design and maintenance services and electric vehicle (“EV”) charging infrastructure solutions. We help our customers achieve their sustainability, energy savings and carbon footprint reduction goals through innovative technology and exceptional service. We research, design, develop, manufacture, market, sell, install, and implement energy management systems consisting primarily of high-performance, energy-efficient commercial and industrial interior and exterior LED lighting systems and related services. Our products are targeted for applications in the following primary market segments: commercial office and retail, area lighting, industrial applications and government, although we do sell and install products into other markets. Our services consist of turnkey installation and system maintenance. Virtually all of our sales occur within North America or for the US Department of Defense's military bases operating in foreign countries.

Our lighting products consist primarily of LED lighting fixtures, many of which include IoT enabled control systems. Our principal lighting customers include large national account end-users, federal and state government facilities, large regional account end-users, electrical distributors, electrical contractors and energy service companies (“ESCOs”). Currently, most of our interior lighting products are manufactured at our leased production facility located in Manitowoc, Wisconsin, although as the LED and related IoT market continues to evolve, we are increasingly sourcing products and components from third parties in order to provide versatility in our product development and offerings.

We differentiate ourselves from our competitors by offering comprehensive project management services to national account customers to retrofit their multiple locations. Our comprehensive services include initial site surveys and audits, utility incentive and government subsidy management, engineering design, and project management from delivery through to installation and controls integration. In addition, we offer lighting and electrical maintenance services which enables us to support a lifetime business relationship with our customer (which we call “Customers for Life”). We completed the acquisition of Voltrek on October 5, 2022, which further expanded our turnkey services capabilities as well as capitalized on the rapidly growing market for EV charging solutions. We completed the Stay-Lite Lighting acquisition on January 1, 2022, which further expanded our maintenance services capabilities.

We believe the market for LED lighting products and related controls continues to grow. Due to their size and flexibility in application, we also believe that LED lighting systems can address opportunities for retrofit applications that cannot be satisfied by other lighting technologies. Our LED lighting technologies have become the primary component of our revenue as we continue to strive to be a leader in the LED market.

We see opportunity to cross-sell our three platforms of lighting, maintenance services and EV charging installation systems to our commercial and industrial customer base. We are pursuing opportunities to cross-sell to direct customers, as well as through select partners. We also see opportunity for further integration of our service capabilities to expand our geographic reach and we currently intend to pursue growth organically.

Other than our multi-year maintenance service contracts, we generally do not have long-term contracts with our customers for product or turnkey services that provide us with recurring annual revenue. We typically generate substantially all of our revenue from sales of lighting and control systems and related services to governmental, commercial and industrial customers on a project-by-project basis. We also perform work under master services or product purchasing agreements with major customers with sales completed on a purchase order basis. In addition, in order to provide quality and timely service under our multi-location master retrofit agreements, we ~~make substantial working capital expenditures and advance inventory purchases that we intend to recoup through the completion of these or similar projects.~~

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make substantial working capital expenditures and advance inventory purchases that we intend to recoup through the completion of these or similar projects.

We typically sell our lighting systems in replacement of our customers’ existing fixtures. We call this replacement process a "retrofit". We frequently engage our customer’s existing electrical contractor to provide installation and project management services. We also sell our lighting systems on a wholesale basis, principally to electrical distributors and ESCOs to sell to their own customer bases.

The gross margins of our products can vary significantly depending upon the types of products we sell, with margins typically ranging from 10% to 50%. As a result, a change in the total mix of our sales among higher or lower margin products can cause our profitability to fluctuate from period to period.

Our fiscal year ends on March 31. We refer to our just completed fiscal year, which ended on March 31, ~~2025~~2026, as "fiscal ~~2025~~2026", and our prior fiscal years which ended on March 31, ~~2024~~2025 and March 31, ~~2023~~2024 as "fiscal ~~2024~~2025" and “fiscal ~~2023~~2024”, respectively. Our fiscal first quarter of each fiscal year ends on June 30, our fiscal second quarter ends on September 30, our fiscal third quarter ends on December 31 and our fiscal fourth quarter ends on March 31.

Reportable segments are components of an entity that have separate financial data that the entity's chief operating decision maker ("CODM") regularly reviews when allocating resources and assessing performance. Our CODM is our chief executive officer. ~~Effective~~We ~~during~~have ~~the first quarter of fiscal 2024, we began to evaluate and report the business using~~ three segments: lighting segment, maintenance segment and EV segment. ~~Previously, we had four reportable segments: Orion Services Group Segment, Orion Distribution Services Segment, Orion U.S. Markets Division and Orion Electric Vehicle Charging.~~

Recent Developments

~~Replacement~~Reverse ofStock ~~our CEO~~Split

On ~~April~~August 1422, 2025, ~~Michael~~we ~~Jenkins’~~effected ~~employment~~a ~~was~~1-for-10 ~~terminated~~reverse bystock ~~Orion,~~split ~~with~~of our ~~Board~~common ~~appointing~~stock ~~Sally~~in A.order ~~Washlow~~to asremain ~~our~~compliant ~~new~~with ~~Chief~~the ~~Executive~~minimum ~~Officer,~~bid ~~effective~~price asrequirements ofset ~~Mr.~~forth ~~Jenkins’~~in ~~termination~~Nasdaq ~~date~~Listing Rule 5550(a)(2) (the “Minimum Bid Price Rule”) for continued listing on the NASDAQ Capital Market (“NASDAQ”).

AsVoltrek aEarnout result of the termination, Mr. Jenkins will receive approximately $633 thousand in severance and the acceleration of approximately 322 thousand restricted stock awards. Mr. Jenkins forfeited approximately 646 thousand performance shares along with approximately $170 thousand in tandem cash awards. Additionally, Mr. Jenkins forfeited restricted stock awards not vesting within two years from the termination date, which was a forfeiture of approximately 78 thousand shares.Settlement

On ~~April~~March 1417, ~~2025~~2026, we entered into ana ~~Executive~~settlement ~~Employment~~agreement ~~and~~(the ~~Severance~~“Settlement Agreement”) with ~~Ms.~~Final ~~Washlow~~Frontier, ~~(the~~LLC (“~~Employment~~Final ~~Agreement~~Frontier”). ~~The~~and ~~Employment~~Kathleen ~~Agreement~~M. ~~provides~~Connors (“Ms. ~~Washlow with the following compensation arrangements: (i~~Connors”), anpersonally ~~annual~~and ~~base~~as ~~salary~~Trustee of ~~$382,500,~~the ~~provided~~Kathleen ~~that~~M. ifConnors ~~our~~2019 ~~other~~Revocable ~~named~~Trust ~~executive~~(“Connors ~~officers’~~Trust” ~~base~~together ~~salaries~~with ~~are~~Final ~~returned~~Frontier toand ~~their pre-reduction levels, then~~ Ms. ~~Washlow’s~~Connors, ~~base~~the ~~salary~~“Connors ~~will~~Parties”), ~~also~~in beorder ~~similarly adjusted up~~ to ~~$425,000;~~reach ~~(ii)~~ a ~~target~~final ~~annual~~and ~~bonus~~complete ofresolution ~~100% (threshold 80%~~ and ~~maximum~~settlement of ~~200%)~~the ofdispute ~~her~~between ~~base~~the ~~salary~~Connors ~~upon~~Parties ~~our~~and ~~relative~~us ~~achievement~~regarding ofour ~~executive~~remaining ~~incentive~~earnout ~~plan~~obligations ~~performance~~owed ~~targets~~to ~~for~~Final ~~each~~Frontier ~~fiscal~~pursuant ~~year;~~to ~~(iii)~~that acertain ~~special~~Membership ~~bonus~~Interest ofPurchase ~~$100~~Agreement,~~000~~ ifdated weas ~~achieve a stretch goal~~ of ~~$100~~October ~~million in revenue for fiscal 2026; (iv) a cash signing bonus of $500~~5,~~000,~~ ~~approximately $300~~2022,~~000~~ ofentered ~~was~~into ~~required to be used~~ by ~~Ms.~~and ~~Washlow~~among ~~to purchase shares of our common stock directly from~~ us; ~~(v) a pre-change of control severance multiplier of 1.5x~~ and athe ~~post-change~~Connors ofParties ~~control severance multiplier of 2.0x;~~ (~~vi)~~the ~~an initial equity grant consisting of a non-qualified stock option exercisable for a total of 500~~“MIPA”),~~000~~ ~~shares~~pursuant ofto ~~our~~which ~~common~~we ~~stock;~~acquired ~~and (vii) certain other benefits and perquisites. On May 29~~Voltrek, ~~2025,~~as ~~our~~well ~~board~~as ~~and Ms. Washlow mutually agreed~~ to ~~defer~~reach ~~Ms.~~a ~~Washlow’s~~final ~~cash~~and ~~signing~~complete ~~bonus~~resolution and ~~related~~settlement ~~direct purchase~~ of ~~common stock for up to one year, with the timing of such cash signing bonus and~~ related ~~direct~~arbitrations ~~purchase of our common stock to be reviewed quarterly~~ and ~~mutually~~terminate ~~agreed~~related ~~upon~~agreements, byas ~~the~~described ~~compensation committee and Ms~~below. ~~Washlow.~~

~~Voltrek~~Pursuant ~~Earn-Out~~to the MIPA and a binding term sheet (as amended, the "Term Sheet"), we and the Connors Parties submitted our earn out statement dispute to CPA firm arbitration (the “CPA Firm Arbitration”). The Connors Parties asserted that the remaining earn out payments owed by us totaled approximately $10 million. Our position was that we owed the Connors Parties an additional $1.4 million. The CPA arbitrators determined that we owed an additional $3.4 million of earnout payments. Subsequently, we filed an arbitration demand with the American Arbitration Association in Milwaukee, Wisconsin against the Connors Parties in order to object to the CPA firm’s decision of the earnout statement dispute as manifest error (the “AAA Arbitration”).

~~Effective~~By onentering ~~October~~into 5,the ~~2022~~Settlement Agreement, we ~~acquired~~and ~~all of~~ the ~~outstanding~~Connors ~~membership~~Parties ~~interests~~agreed ofto ~~Voltrek,~~ a ~~leading~~final ~~electric~~and ~~vehicle~~complete ~~charging~~resolution ~~company~~and ~~that~~settlement ~~provides~~of ~~turnkey~~the ~~installation~~CPA ~~solutions~~Firm ~~with~~Arbitration ~~ongoing~~and ~~support~~the toAAA ~~all~~Arbitration, ~~commercial~~a ~~verticals.~~final ~~The~~and ~~initial~~complete ~~purchase~~resolution ~~price~~and ~~consisted~~settlement of ~~$5.0~~the ~~million~~earnout ~~cash~~statement ~~and~~dispute, ~~$1.0~~termination ~~million~~ of ~~common~~the ~~stock.~~MIPA, Wetermination ~~also~~of ~~paid~~all ~~$3.0~~related ~~million~~earnout inagreements ~~initial~~and ~~earn-out~~termination ~~payments~~of ~~based~~any onand ~~Voltrek’s~~all ~~financial~~claims ~~performance~~and incounterclaims ~~fiscal~~between ~~2023.~~or Weamong ~~may~~us ~~owe~~and ~~additional~~the ~~material~~Connors ~~earn-out~~Parties, ~~payments~~without ~~based~~any onadmission ~~Voltrek’s~~of ~~financial~~liability ~~performance~~and inwithout ~~fiscal~~incurring ~~2025.~~of Weany ~~have~~further ~~currently~~payment, ~~accrued~~cost, ~~an estimated~~ liability, ~~of approximately $3.3 million for such remaining earn-out payments.~~

3129

~~On June 23~~obligation, ~~2025~~guaranty, weexpense ~~entered~~or ~~into~~inconvenience ~~the Term Sheet~~ with respect ~~to our remaining earn-out obligations owed to Final Frontier pursuant to our October 5, 2022 acquisition of Voltrek~~thereto. Pursuant to the Term Sheet, on August 1, 2025, we will pay Final Frontier $875,000 in full and final payment of our fiscal 2024 Voltrek acquisition earn-out obligations. We also agreed with Final Frontier to submit the final determination of our fiscal 2025 and aggregate fiscal 2023 through fiscal 2025 earn-out obligations to binding arbitration if not otherwise mutually agreed by the parties. We agreed to pay to Final Frontier the finally determined remaining earn-out amount as follows: (i) $1.0 million in our common stock issuable 14 trading days after our fiscal 2025 earnings announcement and (ii) the remaining amount pursuant to the anticipated Senior Subordinated Note. We agreed to pay monthly principal payments to Final Frontier on the anticipated Senior Subordinated Note of $25,000 beginning on January 15, 2026, which will increase to $50,000 on July 15, 2026 through maturity. We will also pay interest monthly to Final Frontier at the annual rate of 7% beginning on July 15, 2025. We have the right to pay up to 20% of the remaining outstanding earn-out amount at maturity in shares of our common stock. The anticipated Senior Subordinated Note will be subordinated to our senior credit facilities with Bank of America and will be secured by a second lien on all of our assets. We and Final Frontier agreed to use our respective commercially reasonable best efforts to agree to final documentation further reflecting the terms and conditions set forth in the Term Sheet within 30 days of entering into the Term Sheet.

~~The~~Under ~~final~~the ~~earn~~terms of the Settlement Agreement, we made a one-~~out~~time ~~amount~~cash ~~determined~~payment of $3.0 million (the “Settlement Amount”) to beFinal ~~owed~~Frontier byon usMarch ~~could~~18, be2026. inUpon ~~excess~~receipt of the Settlement Amount, all earn out payment obligations, the MIPA, all earnout agreements, the CPA Firm Arbitration and the AAA Arbitration proceedings were terminated, cancelled and released, and all liens and security interests held by Final Frontier on our ~~current~~assets ~~accrued~~were ~~liability~~automatically ~~for~~terminated ~~such~~and irrevocably released. Additionally, upon payment of the Settlement Amount, we and the Connors Parties exchanged mutual general releases of all claims arising from or related to the earn- out ~~amount~~disputes, the CPA Firm Arbitration and ~~could~~the ~~materially~~AAA ~~adversely~~Arbitration proceedings, the MIPA and the earnout agreements. The releases did not affect ~~our~~Ms. ~~future~~Connors’ ~~liquidity~~then part-time employment relationship with us or the Connors Parties’ rights as shareholders of our Company. We also agreed to facilitate the Connors Parties’ entry into a Rule 10b5-1 trading plan during our next insider open window period to facilitate the Connors Parties’ sale of their shares of our common stock.

Significant New Exterior Lighting Project

We have been awarded a new large-scale LED exterior lighting project with a leading international retail chain, anticipated to generate approximately $14 million to $15 million of revenue. The large-scale project began in our fourth quarter of fiscal 2026, with the majority of the project expected to be completed by the end of July 2026. This new order follows our October 31, 2025 announcement of a three-year renewal of a major LED lighting maintenance contract for this customer, with the renewal having an estimated total revenue potential of between $42 million to $45 million. We will continue to maintain LED lighting systems for more than 2,000 stores operated by this retailer. There is an additional potential for significant expansion of this customer relationship in our fiscal 2027.

Ongoing Cost Cutting Initiatives

Over the past two fiscal years, we have been successful in reducing our annual operating expenses by approximately $2.0 million. This cost cutting and overhead reduction initiative has resulted in improved gross margins and profitability.

Public Stock Offering

On February 2, 2026, we issued 500,000 shares of our common stock at a price to the public of $14.00 per share pursuant to a firmly underwritten public offering. Net proceeds from the offering of approximately $6.4 million were used to reduce amounts outstanding under our credit agreement, with the remainder used for working capital and general corporate purposes.

Replacing Reduced Revenue from Primary Customer

In fiscal ~~2025~~2026, ~~2024~~2025 and ~~2023~~2024, one customer accounted for 2426.30%, 2518.21% and 1625.26% of our total revenue, respectively. ~~In fiscal 2026, we expect that our customer concentration will continue at the approximate range experienced in fiscal 2025 and 2024.~~ We continue to attempt to diversify our customer base by expanding our reach to national accounts, ESCOs, the agent driven distribution channel, lighting maintenance customers and the EV market.

32Solar Asset Termination Agreement

Effective March 19, 2026, we executed a termination agreement with a customer to terminate two power purchase agreements (“PPAs”) that commenced in 2010. The PPAs covered two solar panel arrays on two buildings in New Jersey under which we contracted to sell the solar power generation from the respective solar panel arrays through 2030. Under the terms of the termination agreement, we transferred ownership of the solar arrays to a third party and terminated any future obligations related to those assets in exchange for a cash payment of $1.3 million.

Credit Facility Extension

On May 29, 2026, we and Bank of America, N.A. as lender, executed Amendment No. 5 (“Amendment No. 5”) to our Loan and Security Agreement dated December 29, 2020 and amended previously on September 30, 2025 (as amended, the “credit agreement”). The primary purpose of Amendment No. 5 was to extend the maturity date of the Credit Facility from June 30, 2027 to June 30, 2030.

Tariff Relief

In February 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers

Act (“IEEPA”) were unlawful. On April 20, 2026, U.S. Customs and Border Protection launched a portal intended to automate and consolidate the related refund claim process, including associated interest payments. We submitted refund claims related to certain previously paid tariffs. Due to the uncertainly surrounding payment of any potential refund claims, no amounts are reflected in our fiscal 2026 financial statements. As of May 31, 2026, we have received approximately $219 thousand in tariff refunds, including approximately $13 thousand of interest income. The ultimate amount and timing of recovery remains subject to continued administrative review and claim approval.

Selected Financial Data

The selected historical consolidated financial data are not necessarily indicative of future results.

	Fiscal Year Ended March 31,
	2025			2024			2023			2022			2021
	2026			2025			2024			2023			2022
	(in thousands, except per share amounts)
Consolidated statements of operations data:
Product revenue	$	5457,~~368~~029		$	6354,~~307~~368		$	5763,~~210~~307		$	9157,~~889~~210		$	8791,~~664~~889
Service revenue		2529,~~352~~277			2725,~~274~~352			2027,~~173~~274			3220,~~494~~173			2932,~~176~~494
Total revenue		7986,~~720~~306			9079,~~581~~720			7790,~~383~~581			~~124~~77,383			~~116~~124,~~840~~383
Cost of product revenue (1) (2) (8)		3736,~~319~~893			4437,~~466~~319			4244,~~979~~466			6542,~~249~~979			6365,~~233~~249
Cost of service revenue (1) (3) (8)		2221,~~165~~320			2522,~~204~~165			1625,~~893~~204			2516,~~222~~893			2325,~~483~~222
Total cost of revenue		5958,~~484~~213			6959,~~670~~484			5969,~~872~~670			9059,~~471~~872			8690,~~716~~471
Gross profit		2028,~~236~~093			20,~~911~~236			1720,~~511~~911			3317,~~912~~511			3033,~~124~~912
General and administrative expenses (1) (4) (8)		18,~~008~~691			1618,~~740~~008			1916,~~487~~740			1119,~~680~~487			11,~~262~~680
Impairment of assets (5)		—			~~456~~-			—456			~~512~~—			—512
Acquisition related costs		—			56—			~~765~~56			—765			—
Sales and marketing expenses (1) (5) (8)		1110,~~595~~099			1211,~~988~~595			1112,~~392~~988			11,~~628~~392			1011,~~341~~628
Research and development expenses (1)(6) (8)		~~1,229~~945			1,~~495~~229			1,~~852~~495			1,~~701~~852			1,~~685~~701
(Loss) income from operations		(101,~~596~~642	)		(10,~~824~~596	)		(1510,~~985~~824	)		8(15,~~391~~985	)		68,~~836~~391
Other income		6251			3962			—39			1-			561
Interest expense		(~~1,026~~783	)		(~~752~~1,026	)		(~~339~~752	)		(80339	)		(~~127~~80	)
Amortization of debt issue costs		(~~206~~170	)		(95206	)		(7395	)		(6273	)		(~~157~~62	)
Loss on debt extinguishment		—(562	)		—			—			—			~~(90~~—	)
Dividend and interest income		73			27			342			—34			—
(Loss) income before income tax		(113,~~759~~103	)		(11,~~630~~759	)		(1611,~~363~~630	)		8(16,~~250~~363	)		68,~~518~~250
Income tax expense (benefit) (7)		4260			4142			~~17,978~~41			217,~~159~~978			~~(19~~2,~~616~~159	)
Net (loss) income	$	(113,~~801~~163	)	$	(11,~~671~~801	)	$	(3411,~~341~~671	)	$	6(34,~~091~~341	)	$	266,~~134~~091
Net (loss) income per share attributable to common shareholders:
Basic	$	(0.3689	)	$	(03.3659	)	$	(13.0859	)	$	0(10.2083	)	$	01.8596
Diluted	$	(0.3689	)	$	(03.3659	)	$	(13.0859	)	$	0(10.1983	)	$	01.8395
Weighted-average shares outstanding:
Basic		323,~~829~~561			323,~~486~~283			313,~~704~~249			313,~~018~~170			303,~~635~~102
Diluted		323,~~829~~561			323,~~486~~283			313,~~704~~249			313,~~295~~170			313,~~304~~130

(1)

Includes stock-based compensation expense recognized under Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation-Stock Compensation, or ~~ASC~~Accounting ~~Topic~~Standards Codification (ASC) 718, as follows:

	Fiscal Year Ended March 31,
	2025		2024		2023		2022		2021
	2026		2025		2024		2023		2022
	(in thousands)
Cost of product revenue	$	7—	$	57	$	45	$	54	$	45
Cost of service revenue		—		—		—		—		—
General and administrative expenses		~~1,111~~434		~~923~~1,111		~~1,596~~923		~~793~~1,596		~~716~~793
Sales and marketing expenses		3146		1731		817		128		2912
Research and development expenses		83		58		45		34		43
Total stock-based compensation expense	$	~~1,157~~483	$	~~950~~1,157	$	~~1,612~~950	$	~~813~~1,612	$	~~753~~813

~~Fiscal 2025 and Fiscal 2024 includes expense of $295 thousand and $26 thousand related to restructuring, respectively.~~ 31

(2)

Fiscal 2025 and ~~Fiscal~~fiscal 2024 includes expense of $~~176~~295 thousand and $4826 thousand related to restructuring, respectively.

(3)

Fiscal 2025 and ~~Fiscal~~fiscal 2024 ~~include~~includes ~~expenses~~expense of $~~442~~176 thousand and $2848 thousand related to restructuring, respectively.

(4)

Fiscal 2025 and ~~Fiscal~~fiscal 2024 ~~includes~~include ~~expense~~expenses of $26442 thousand and $2128 thousand related to restructuring, respectively.

(5)

Fiscal 2025 and ~~Fiscal~~fiscal 2024 includes expense of $~~109~~26 thousand and $021 thousand related to restructuring, respectively.

(6)

Fiscal 2025 and fiscal 2024 includes expense of $109 thousand and $0 related to restructuring, respectively.

(7)

Fiscal 2021 includes tax benefit of $20.9 million related to the release of the valuation allowance on deferred tax assets. Fiscal 2023 includes tax expense of $17.8 million related to the recording of the valuation allowance on deferred tax assets.

(8)

Fiscal 2022 includes an offset to payroll expenses of $1.6 million related to the anticipated employee retention payroll tax credit (“payroll tax credit”), as expanded and extended by the American Rescue Plan Act of 2021, as follows:


	Fiscal Year Ended March 31, 2022
	(in thousands)
Cost of product revenue	$	649
Cost of service revenue		144
General and administrative expenses		273
Sales and marketing expenses		416
Research and development expenses		105
Total payroll tax credit	$	1,587

Results of Operations: Fiscal ~~2025~~2026 versus Fiscal ~~2024~~2025

The following table sets forth the line items of our consolidated statements of operations and as a relative percentage of our total revenue for each applicable period, together with the relative percentage change in such line item between applicable comparable periods (in thousands, except percentages):

	Fiscal Year Ended March 31,
	2025			2024						2025			2024
	2026			2025						2026			2025
	Amount			Amount			% Change			% ofRevenue			% ofRevenue
Product revenue	$	5457,~~368~~029		$	6354,~~307~~368			~~(14~~4.19	)%		6866.21	%		6968.92	%
Service revenue		2529,~~352~~277			2725,~~274~~352			(715.05	)%		3133.89	%		3031.18	%
Total revenue		7986,~~720~~306			9079,~~581~~720			~~(12~~8.03	)%		100.0	%		100.0	%
Cost of product revenue		3736,~~319~~893			4437,~~466~~319			(161.1	)%		4642.87	%		4946.18	%
Cost of service revenue		2221,~~165~~320			2522,~~204~~165			(123.18	)%		2724.87	%		27.8	%
Total cost of revenue		5958,~~484~~213			6959,~~670~~484			(142.61	)%		7467.64	%		7674.96	%
Gross profit		2028,~~236~~093			20,~~911~~236			(338.28	)%		2532.46	%		2325.14	%
General and administrative expenses		18,~~008~~691			1618,~~740~~008			73.68	%		2221.67	%		1822.56	%
Impairment on Intangibles		—			456			(100.0	)%		0.0	%		0.5	%
Sales and marketing expenses		10,099			11,595			(12.9	)%		11.7	%		14.5	%
Acquisition related costs		—			56			(100.0	)%		0.0	%		0.1	%
Research and development expenses		945			1,229			(23.1	)%		1.1	%		1.5	%
Sales and marketing expenses		11,595			12,988			(10.7	)%		14.5	%		14.3	%
(Loss) income from operations		(1,642	)		(10,596	)		(84.5	)%		(1.9	)%		(13.3	)%
Research and development expenses		1,229			1,495			(17.8	)%		1.5	%		1.7	%
Other income		51			62			(17.7	)%		0.1	%		0.1	%
(Loss) income from operations		(10,596	)		(10,824	)		(2.1	)%		(13.3	)%		(11.9	)%
Interest expense		(783	)		(1,026	)		23.7	%		(0.9	)%		(1.3	)%
Other income		62			39			59.0	%		0.1	%		0.0	%
Amortization of debt issue costs		(170	)		(206	)		17.5	%		(0.2	)%		(0.3	)%
Interest expense		(1,026	)		(752	)		(36.4	)%		(1.3	)%		(0.8	)%
Loss on debt extinguishment		(562	)		—		NM				(0.7	)%		—
Amortization of debt issue costs		(206	)		(95	)		(116.8	)%		(0.3	)%		(0.1	)%
Interest income		3			7			(57.1	)%		0.0	%		0.0	%
(Loss) income before income tax		(113,~~759~~103	)		(11,~~630~~759	)		(173.16	)%		(143.86	)%		(1214.8	)%
Income tax expense		4260			4142			(242.49	)%		0.1	%		0.01	%
Net (loss) income	$	(113,~~801~~163	)	$	(11,~~671~~801	)		(173.12	)%		(143.87	)%		(1214.98	)%

* NM = Not Meaningful

3432

Revenue, Cost of Revenue and Gross Margin. Product revenue ~~decreased~~increased by 144.19%, or $82.97 million, for fiscal ~~2025~~2026 versus fiscal ~~2024~~2025. Service revenue ~~decreased~~increased by 715.05%, or $13.9 million, for fiscal ~~2025~~2026 versus fiscal ~~2024~~2025. The ~~decrease~~increase in product revenue was primarily due to ~~the~~an ~~execution~~increase ofin athe ~~significant~~maintenance ~~government~~segment ~~retrofit~~along ~~lighting~~with ~~segment~~the ~~project~~contract ~~that~~modification ~~ended~~of inour ~~the~~solar ~~second~~agreement ~~quarter~~leading ofto ~~the~~additional ~~current~~recognized ~~fiscal year~~revenue. The ~~decrease~~increase in service revenue was due to ~~multiple~~an ~~customers~~increase in ~~our~~projects ~~maintenance~~in ~~segment~~our ~~that~~lighting ~~chose not to renew their contracts for fiscal 2025~~segment. Cost of product revenue decreased by 161.1%, or $70.14 million, in fiscal ~~2025~~2026 versus the comparable period in fiscal ~~2024~~2025. Cost of service revenue decreased by 123.18%, or $3.0.8 million, in fiscal ~~2025~~2026 versus fiscal ~~2024~~2025. The decreases were primarily ~~because~~due ofto ~~decreases~~the incost ~~revenue~~savings ~~described~~initiatives ~~above~~put into place in fiscal 2025. Gross margin increased to 2532.46% of revenue in fiscal ~~2025~~2026 from 2325.14% in fiscal ~~2024~~2025, due primarily to a more favorable sales mix along with better overall margins in the ~~maintenance~~lighting ~~segment~~and EV segments.

Operating Expenses

General and Administrative. General and administrative expenses increased 73.68%, or $10.37 million, in fiscal ~~2025~~2026 compared to fiscal ~~2024~~2025. This comparative increase was primarily due to ~~increased~~earnout ~~earn~~compensation costs, sign-~~out~~on ~~compensation~~bonus costs ~~along~~and ~~with~~disposal ~~incurred~~of ~~severance~~solar ~~expenses~~assets costs, which were partially offset by a reduction in workforce related to restructuring that occurred in the first half of fiscal 2025.

~~Acquisition~~Sales ~~Related~~and ~~Costs~~Marketing. InOur ~~fiscal~~sales ~~2025,~~and wemarketing ~~did~~expenses ~~not~~decreased ~~incur~~12.9%, ~~any~~or ~~acquisition expenses~~$1.5 Inmillion, in fiscal ~~2024,~~2026 wecompared ~~incurred~~to ~~acquisition~~fiscal ~~expenses~~2025. ofThe ~~$56~~decrease ~~thousand~~was ~~relating~~primarily due to ~~the~~decreases ~~acquisition~~in ofemployment ~~Voltrek~~costs throughout fiscal 2026.

~~Sales~~Research and ~~Marketing~~Development. ~~Our~~Research ~~sales~~ and ~~marketing~~development expenses decreased 1023.71%, or $10.43 million, in fiscal ~~2025~~2026 compared to fiscal ~~2024.~~2025 ~~The decrease was~~ primarily due to ana decrease in ~~commission~~employment ~~expense on lower sales volume~~costs.

~~Research~~Interest ~~and Development~~Expense. ~~Research~~Interest ~~and~~expense ~~development~~in ~~expenses~~fiscal 2026 decreased ~~17.8%,~~by or $0.32 million, into ~~fiscal~~$0.8 ~~2025~~million ~~compared~~primarily due to ~~fiscal~~lower ~~2024~~outstanding ~~primarily~~amounts ~~due~~on tothe aline ~~decrease~~of incredit ~~testing~~throughout ~~costs.~~fiscal 2026.

Interest Expense. Interest expense in fiscal 2025 increased by $0.3 million to $1.0 million primarily because the term loan that was entered into in the first quarter of fiscal 2025 and a higher interest rate on our credit facility.

Results of Operations: Fiscal 2024 versus Fiscal 2023

	Fiscal Year Ended March 31,
	2024			2023						2024			2023
	Amount			Amount			% Change			% ofRevenue			% ofRevenue
Product revenue	$	63,307		$	57,210			10.7	%		69.9	%		73.9	%
Service revenue		27,274			20,173			35.2	%		30.1	%		26.1	%
Total revenue		90,581			77,383			17.1	%		100.0	%		100.0	%
Cost of product revenue		44,466			42,979			3.5	%		49.1	%		55.5	%
Cost of service revenue		25,204			16,893			49.2	%		27.8	%		21.8	%
Total cost of revenue		69,670			59,872			16.4	%		76.9	%		77.4	%
Gross profit		20,911			17,511			19.4	%		23.1	%		22.6	%
General and administrative expenses		16,740			19,487			(14.1	)%		18.5	%		25.2	%
Impairment on intangibles		456			—		NM				0.5	%		0.0	%
Acquisition related costs		56			765			(92.7	)%		0.1	%		1.0	%
Sales and marketing expenses		12,988			11,392			14.0	%		14.3	%		14.7	%
Research and development expenses		1,495			1,852			(19.3	)%		1.7	%		2.4	%
(Loss) income from operations		(10,824	)		(15,985	)		(32.3	)%		(11.9	)%		(20.7	)%
Other income		39			—		NM				0.0	%		0.0	%
Interest expense		(752	)		(339	)		(121.8	)%		(0.8	)%		(0.4	)%
Amortization of debt issue costs		(95	)		(73	)		(30.1	)%		(0.1	)%		(0.1	)%
(Loss) income before income tax		(11,630	)		(16,363	)		(28.9	)%		(12.8	)%		(21.1	)%
Income tax expense (benefit)		41			17,978		NM				0.0	%		23.2	%
Net (loss) income	$	(11,671	)	$	(34,341	)		(66.0	)%		(12.9	)%		(44.4	)%

* NM = Not Meaningful

Revenue, Cost of Revenue and Gross Margin. Product revenue increased by 10.7%, or $6.1 million, for fiscal 2024 versus fiscal 2023. Service revenue increased by 35.2%, or $7.1 million, for fiscal 2024 versus fiscal 2023. The increase in product and service revenue was primarily due to the execution of a significant government retrofit lighting segment project along with increased EV segment revenues. Cost of product revenue increased by 3.5%, or $1.5 million, in fiscal 2024 versus the comparable period in fiscal 2023. Cost of service revenue increased by 49.2%, or $8.3 million, in fiscal 2024 versus fiscal 2023. The increases were primarily because of increases in revenue described above along with higher cost in our maintenance segment. Gross margin increased to 23.1% of revenue in fiscal 2024 from 22.6% in fiscal 2023, due primarily to improved absorption of fixed costs on increased revenue volume and mix.

Operating Expenses

General and Administrative. General and administrative expenses decreased 14.1%, or $2.7 million, in fiscal 2024 compared to fiscal 2023. This comparative decrease was primarily due to a reduction in estimate of $0.9 million of earn-out compensation costs recorded in fiscal 2023 related to the Voltrek acquisition, partially offset by a full year of cost at Voltrek.

Acquisition Related Costs. In fiscal 2024, we incurred acquisition costs of $56 thousand, primarily relating to the Voltrek acquisition. In fiscal 2023, we incurred acquisition expenses of $0.8 million relating to the acquisition of Voltrek.

Sales and Marketing. Our sales and marketing expenses increased 14.0%, or $1.6 million, in fiscal 2024 compared to fiscal 2023. The increase was primarily due to an increase in commission expense on higher sales volume.

Research and Development. Research and development expenses decreased 19.3%, or $0.4 million, in fiscal 2024 compared to fiscal 2023 primarily due to a decrease in testing costs.

Interest Expense. Interest expense in fiscal 2024 increased by $0.4 million to $0.8 million primarily because of a full year of borrowings in fiscal 2024 and a higher interest rate on our credit facility.

Income Taxes. Income tax expense decreased $18.0 million, or 99.9%, to $41 thousand compared to fiscal 2023. The fiscal 2023 expense included a one-time $17.8 million non-cash charge to increase the valuation allowance on a significant portion of our deferred tax assets. We do not expect to remit significant cash taxes for the next several years.

Lighting Segment

Our lighting segment develops and sells lighting products and provides construction and engineering services for our commercial lighting and energy management systems. Our lighting segment provides engineering, design, lighting products and in many cases turnkey solutions for large national accounts, governments, municipalities, schools and other customers. Our lighting segment sells through ESCOs, Lighting Agents, Distributors and direct (turnkey) to end users.

The following table summarizes our lighting segment operating results (dollars in thousands):

	Fiscal Year Ended March 31,
	2025			2024			2023
	2026			2025
Revenues	$	4755,~~704~~880		$	6147,~~102~~704		$	~~56,553~~
Operating (loss) income	$	(2,~~765~~175	)	$	(12,~~352~~765	)	$	~~(5,150~~	)
Operating margin		(53.89	)%		(25.28	)%		~~(9.1~~	)%

Fiscal ~~2025~~2026 Compared to Fiscal ~~2024~~2025

Lighting segment revenue ~~decreased~~increased in fiscal ~~2025~~2026 by 2117.91%, or $138.42 million, and operating ~~loss~~income increased $1.4.9 million, compared to fiscal ~~2024~~2025, due to ~~decreased~~increased project volumes in fiscal 2025 along with the recognition of solar revenue due to the contract modification in March of 2026. This ~~decrease~~increase in revenues led to a corresponding operating ~~loss~~income increase in this segment, along with ~~decreased~~increased project margins.

Fiscal 2024 Compared to Fiscal 2023

Lighting segment revenue increased in fiscal 2024 compared to fiscal 2023 by 8.0%, or $4.6 million, and operating income decreased $3.8 million, compared to fiscal 2023, due to increased project volume on a government retrofit project. This increase led to a corresponding operating loss decrease in this segment, along with improved project margins.

Maintenance Segment

The following table summarizes our maintenance segment operating results (dollars in thousands):

	Fiscal Year Ended March 31,
	2025			2024			2023
Revenues	$	15,190		$	17,147		$	14,555
Operating (loss) income	$	(1,188	)	$	(5,523	)	$	(2,221	)
Operating margin		(7.8	)%		(32.2	)%		(15.3	)%

Fiscal 2025 Compared to Fiscal 2024


	Fiscal Year Ended March 31,
	2026			2025
Revenues	$	16,042		$	15,190
Operating (loss) income	$	1,166		$	(1,188	)
Operating margin		7.3	%		(7.8	)%

~~Maintenance~~Fiscal ~~segment~~2026 ~~revenue~~Compared ~~decreased $2.0 million, or 11.4%, in fiscal 2025 compared~~ to ~~fiscal~~Fiscal ~~2024 primarily due to some legacy customers not renewing their contracts in fiscal~~ 2025 ~~due to increased project costs to improve segment margins. As a result,~~

37Maintenance segment revenue increased $0.9 million, or 5.6%, in fiscal 2026 compared to fiscal 2025 primarily due to increased projects for a large customer. As a result, operating income increased $2.4 million in fiscal 2026 compared to fiscal 2025 primarily due to better project margins throughout the segment.

operating loss decreased $4.3 million, or 78.5%, in fiscal 2025 compared to fiscal 2024 primarily due to better project margins throughout the segment.

Fiscal 2024 Compared to Fiscal 2023

Maintenance segment revenue increased $2.6 million, or 17.8%, in fiscal 2024 compared to fiscal 2023 primarily due to increased volume at a major customer. Operating loss increased $3.3 million, or 148.6%, in fiscal 2024 compared to fiscal 2023 primarily due to increased costs on fixed price contracts.

EV Segment

Our EV segment offers leading electric vehicle charging expertise and provides EV turnkey installation solutions with ongoing support to all commercial verticals.

The following table summarizes our EV segment operations results (dollars in thousands):

	Fiscal Year Ended March 31,
	2025			2024			2023
	2026			2025
Revenues	$	1614,~~826~~384		$	1216,~~332~~826			~~6,275~~
Operating loss	$	(~~2,356~~648	)	$	(12,~~563~~356	)		~~(4,158~~	)
Operating margin		(144.05	)%		(1214.70	)%		~~(66.3~~	)%

Fiscal ~~2025~~2026 Compared to Fiscal ~~2024~~2025

EV segment revenue ~~increased~~decreased 3614.45%, or $42.54 million, in fiscal ~~2025~~2026 compared to fiscal ~~2024~~2025 primarily due to ~~increased~~project ~~sales to municipalities~~delays. EV segment operating loss ~~increased~~decreased $01.87 million, or 5072.75%, in fiscal ~~2025~~2026 compared to fiscal ~~2024~~2025 primarily due to ~~increased~~a ~~earn-out~~more ~~amounts,~~beneficial ~~which~~sales ~~were~~mix ~~partially~~leading ~~offset~~to byhigher ~~increased revenue volume in the segment, along with increased gross~~ margins.

Fiscal 2024 Compared to Fiscal 2023

EV segment revenue increased 96.5%, or $6.1 million, in fiscal 2024 compared to fiscal 2023 primarily due to a full year of Voltrek results being included in segment results. EV segment operating loss decreased $2.6 million, or 62.4%, in fiscal 2024 compared to fiscal 2023 due to increased revenue volume in the segment, partially offset by reduced gross margins.

Liquidity and Capital Resources

Overview

We had $63.03 million in cash and cash equivalents as of March 31, ~~2025~~2026, compared to $56.20 million at March 31, ~~2024~~2025. Our cash position ~~increased~~decreased due to the results in our operations, ~~sales~~satisfaction of ~~property and equipment, and proceeds from~~ the ~~mortgage~~final ~~loan~~Voltrek ~~entered~~earnout ~~into~~obligation atand ~~the~~paydown ~~beginning~~ of ~~fiscal~~our ~~2025~~Credit Facility. These ~~increases~~decreases were partially offset by ~~payments~~net ~~made~~proceeds onfrom our ~~revolving~~February ~~credit~~2026 ~~facility~~underwritten public stock offering of approximately $6.4 million.

As of March 31, ~~2025~~2026, our borrowing base supported $15.06 million of availability under our credit facility, with $73.0 million drawn against that availability. As of March 31, ~~2024~~2025, our borrowing base supported $2015.10 million of availability under our credit facility, with $107.0 million drawn against that availability.

~~Effective~~Additional information on ~~October~~our 5,credit ~~2022,~~agreement wecan ~~acquired~~be ~~all~~found ofin the ~~outstanding~~“Indebtedness” ~~membership~~section ~~interests~~located ~~of Voltrek, a leading electric vehicle charging company that provides turnkey installation solutions with ongoing support to all commercial verticals~~below. We may owe additional material earn-out payments based on Voltrek’s financial performance in fiscal 2025. While we have currently accrued an estimated liability of approximately $3.3 million for such remaining earn-out payments.

38In March 2023, we filed a universal shelf registration statement with the Securities and Exchange Commission. Under our shelf registration statement, we currently have the flexibility to publicly offer and sell from time to time debt and/or equity securities. The filing of the shelf registration statement may help facilitate our ability to raise public equity or debt capital to expand existing businesses, fund potential acquisitions, invest in other growth opportunities, repay existing debt, or for other general corporate purposes. Based on

On June 23, 2025, we entered into the Term Sheet with respect to our remaining earn-out obligations owed to Final Frontier pursuant to our October 5, 2022 acquisition of Voltrek. Pursuant to the Term Sheet, on August 1, 2025, we will pay Final Frontier $875,000 in full and final payment of our fiscal 2024 Voltrek acquisition earn-out obligations. We also agreed with Final Frontier to submit the final determination of our fiscal 2025 and aggregate fiscal 2023 through fiscal 2025 earn-out obligations to binding arbitration if not otherwise mutually agreed by the parties. We agreed to pay to Final Frontier the finally determined remaining earn-out amount as follows: (i) $1.0 million in our common stock issuable 14 trading days after our fiscal 2025 earnings announcement and (ii) the remaining amount pursuant to the anticipated Senior Subordinated Note. We agreed to pay monthly principal payments to Final Frontier on the anticipated Senior Subordinated Note of $25,000 beginning on January 15, 2026, which will increase to $50,000 on July 15, 2026 through maturity. We will also pay interest monthly to Final Frontier at the annual rate of 7% beginning on July 15, 2025. We have the right to pay up to 20% of the remaining outstanding earn-out amount at maturity in shares of our common stock. The anticipated Senior Subordinated Note will be subordinated to our senior credit facilities with Bank of America and will be secured by a second lien on all of our assets. We and Final Frontier agreed to use our respective commercially reasonable best efforts to agree to final documentation further reflecting the terms and conditions set forth in the Term Sheet within 30 days of entering into the Term Sheet.34

~~The~~our ~~final~~current ~~earn-out~~market ~~amount~~capitalization, ~~determined~~we toare besubject ~~owed~~to bythe us"baby-shelf" ~~could~~rule bewhich inlimits ~~excess~~the amount of ~~our~~securities ~~current~~that ~~accrued~~can ~~liability~~be ~~for~~issued ~~such~~at ~~earn-out~~any ~~amount~~given ~~and could materially adversely affect our liquidity~~time.

~~Additional~~On ~~information~~February on2, 2026, we issued 500,000 shares of our ~~Credit~~common ~~Agreement~~stock ~~can~~at bea ~~found~~price into the ~~“Indebtedness”~~public ~~section~~of ~~located~~$14.00 ~~below~~per share pursuant to a firmly underwritten public offering. Net proceeds from the offering of approximately $6.4 million were used to reduce amounts outstanding under our credit agreement, with the remainder used for working capital and general corporate purposes.

In ~~March~~April ~~2023~~2024, we ~~filed a universal shelf registration statement with the Securities~~ and ~~Exchange Commission. Under~~ our ~~shelf~~lender ~~registration~~executed ~~statement,~~Amendment weNo.2 ~~currently have the flexibility~~ to ~~publicly~~our ~~offer~~credit ~~and~~agreement ~~sell from time~~ to ~~time~~add upa to $~~100~~3.5 million ofterm ~~debt~~loan ~~and/or~~to ~~equity~~the ~~securities~~credit facility. The ~~filing~~amendment ofalso expanded the ~~shelf~~pool ~~registration~~of ~~statement~~eligible ~~may~~receivables ~~help facilitate our ability~~ to ~~raise~~include ~~public~~government ~~equity~~receivables orin ~~debt~~the ~~capital~~calculation toof ~~expand~~the ~~existing~~borrowing ~~businesses,~~base. See ~~fund~~Note ~~potential~~12 ~~acquisitions,~~- ~~invest~~Debt into ~~other~~our ~~growth~~accompanying ~~opportunities,~~audited ~~repay~~consolidated ~~existing~~financial ~~debt,~~statements or for ~~other~~more ~~general corporate purposes~~information.

In ~~March~~October ~~2021~~2024, we ~~entered~~and ~~into~~our anlender Atexecuted ~~Market~~Amendment ~~Issuance~~No.3 ~~Sales Agreement~~ to ~~undertake~~our ancredit ~~“at~~agreement ~~the market” (ATM) public equity capital raising program pursuant~~ to ~~which~~extend wethe ~~may~~maturity ~~offer~~date ~~and sell shares~~ of ~~our~~the ~~common~~Credit ~~stock,~~Facility ~~having an aggregate offering price of up to $50 million~~ from ~~time~~December to29, ~~time~~2025 ~~through or~~ to ~~the~~June ~~Agent~~30, ~~acting as sales agent or principal~~2027. ~~In March 2025, the ATM was terminated.~~

InOn ~~April~~September ~~2024~~30, 2025, we and our lender executed Amendment No.2 4 to our ~~Loan~~credit ~~Security~~agreement, ~~Agreement~~pursuant to ~~add~~which aBank ~~$3.5~~of ~~million~~America ~~term~~consented ~~loan~~to certain subordinated liens we granted in favor of Final Frontier and consented to the ~~credit~~Remaining ~~facility.~~Earnout ~~The~~Amount ~~amendment~~(as ~~also~~defined ~~expanded~~herein) evidenced by the ~~pool~~Subordinated ofLoan ~~eligible~~Agreement ~~receivables~~(as defined herein), subject to ~~include~~certain ~~government~~limitations, ~~receivables~~and to permit us to make cash interest and principal payments to Final Frontier as set forth in the ~~calculation~~Subordinated ofLoan Agreement. On March 18, 2026, the ~~borrowing~~Subordinated ~~base. See~~Loan ~~Note~~Agreement 12was -terminated ~~Long-Term~~and ~~Debt~~cancelled, toand ~~our~~all ~~accompanying~~related ~~audited~~liens ~~consolidated~~and ~~financial~~security ~~statements~~interests ~~for~~held ~~more~~by ~~information~~Final Frontier on our assets were automatically terminated and irrevocably released.

InOn ~~October~~May ~~2024~~29, 2026, we and our lender executed Amendment No.3 5 to our ~~Loan~~credit ~~Security~~agreement ~~Agreement~~ to extend the maturity date of the Credit Facility from ~~December~~June 2930, ~~2025~~2027 to June 30, ~~2027~~2030.

We regularly explore various alternative sources of liquidity to help ensure that we will have the best allocation of invested capital to satisfy our working capital needs.

Our future liquidity needs and forecasted cash flows are dependent upon many factors, including our relative revenue, gross margins, cash management practices, cost containment, working capital management, capital expenditures. While we believe that we will likely have adequate available cash and equivalents and credit availability under our ~~Credit~~credit ~~Agreement~~agreement to satisfy our currently anticipated working capital and liquidity requirements, ~~including our negotiated Voltrek acquisition earn-out payment obligations,~~ during the next 12 months and beyond based on our current cash flow forecast, there can be no assurance to that effect~~, particularly if our Voltrek earn-out amounts are in excess of the liability we have currently accrued~~. If we experience significant liquidity constraints, we may be required to issue equity or debt securities, reduce our sales efforts, implement additional cost savings initiatives or undertake other efforts to conserve our cash.

Cash Flows

The following table summarizes our cash flows for our fiscal ~~2025~~2026, fiscal ~~2024~~2025 and fiscal ~~2023~~2024:

	Fiscal Year Ended March 31,
	2025			2024			2023
	2026			2025			2024
	(in thousands)
Operating activities	$	~~599~~(1,079	)	$	~~(10,092~~599	)	$	(210,~~291~~092	)
Investing activities		~~128~~(86	)		~~(731~~128	)		(~~6,195~~731	)
Financing activities		90(1,542	)		~~(14~~90	)		~~10,012~~(14	)
(Decrease) increase in cash and cash equivalents	$	~~817~~(2,707	)	$	~~(10,837~~817	)	$	1(10,~~526~~837	)

Cash Flows Related to Operating Activities. Cash (used in) ~~provided by~~ operating activities ~~primarily~~for fiscal 2026 was $1.1 million and consisted of our net loss of $3.2 million adjusted for ~~certain~~ non-cash expense items, ~~including~~and ~~depreciation,~~net ~~amortization~~cash ofprovided ~~intangible~~by changes in operating assets, ~~stock-based~~of ~~compensation~~$2.1 million, ~~amortization~~the largest of ~~debt~~which ~~issue~~was ~~costs~~an increase of $3.5 million in accounts receivable, ~~provisions~~a ~~for~~$3.1 ~~reserves~~million increase in revenue earned but not billed, an increase of $2.2 million in accounts payable, and ~~the~~an ~~effect~~increase of ~~changes~~$1.3 million in ~~working~~accrued ~~capital~~expenses and other ~~activities~~.

Cash provided by operating activities for fiscal 2025 was $0.6 million and consisted of our net loss of $11.8 million adjusted for non-cash expense items and net cash provided by changes in operating assets of $12.4 million, the largest of which was a decrease of $6.1 million in inventories, a $5.1 million decrease in accounts payable, and an increase of $1.9 million in accrued expenses.

Cash used in operating activities for fiscal 2024 was $10.1 million and consisted of our net loss of $11.7 million adjusted for non-cash expense items and net cash used in changes in operating assets of $1.6 million, the largest of which was a $5.0 million increase in accounts payable, an increase of $3.2 million in revenue earned but not billed, and a $2.3 million decrease in accrued liabilities.

Cash ~~used~~Flows inRelated ~~operating~~to ~~activities~~Investing ~~for fiscal 2023 was $2~~Activities.3 ~~million~~Cash ~~and consisted of our net loss of $34.3 million adjusted for non-cash expense items and net cash~~ used in ~~changes~~investing activities in ~~operating~~fiscal ~~assets~~2026 ofwas $320.1 million, ~~the~~and ~~largest~~consisted primarily of ~~which~~purchases ~~was a $17.8 million decrease in deferred income tax assets as a result~~ of ~~the~~property ~~valuation~~and ~~allowance~~equipment.

Cash ~~Flows Related to Investing Activities. Cash~~ provided by investing activities in fiscal 2025 was $0.1 million and consisted primarily of $0.2 million of sales of property and equipment and $0.1 million of purchases of property and equipment.

Cash used in investing activities in fiscal 2024 was $0.7 million and consisted primarily of $0.8 million of purchases of property and equipment.

Cash Flows Related to Financing Activities. Cash used in ~~investing~~financing activities in fiscal ~~2023~~2026 was $61.25 million and consisted primarily of payment of long-term debt and paying down the $5line of credit.6 ~~million~~These ~~acquisition~~payments ofwere ~~Voltrek~~partially ~~and~~offset ~~$0.6~~by ~~million~~proceeds offrom ~~purchases~~a ofpublic ~~property~~stock ~~and~~issuance ~~equipment~~along with a draw on the line of credit.

Cash ~~Flows Related to Financing Activities. Cash~~ provided by financing activities in fiscal 2025 was $0.1 million and consisted primarily of proceeds from the term loan that originated in the first quarter of fiscal 2025, which was partially offset by payments on the revolving credit facility.

Cash used in financing activities in fiscal 2024 was $14 thousand.

Cash provided by financing activities in fiscal 2023 was $10.0 million which consisted of proceeds from our revolving credit facility.

Working Capital

Our net working capital as of March 31, 2026 was $11.0 million, consisting of $37.7 million of current assets and $26.7 million of current liabilities. Our net working capital as of March 31, 2025 was $8.7 million, consisting of $35.5 million of current assets and $26.8 million of current liabilities. The change was primarily due to an increase in accounts receivable, revenue earned but not billed, and decreases in our revolving line of credit and accrued expenses and other.

Our net working capital as of March 31, 2025 was $8.7 million, consisting of $35.5 million of current assets and $26.8 million of current liabilities. Our net working capital as of March 31, 2024 was $16.7 million, consisting of $44.8 million of current assets and $28.1 million of current liabilities. The change was primarily due to a decrease in inventories along with a decrease in accounts payable.

Our net working capital as of March 31, 2023 was $25.9 million, consisting of $50.4 million of current assets and $24.5 million of current liabilities. The change in our working capital in fiscal 2024 from our fiscal 2024 year-end was primarily due to a decrease in cash and cash equivalents and an increase in accounts payable, partially offset by an increase in revenue earned not billed.

We generally attempt to maintain a three-month supply of on-hand inventory of purchased components and raw materials to meet anticipated demand, as well as to reduce our risk of unexpected raw material or component shortages or supply interruptions.

Indebtedness

Revolving Credit Agreement

Our credit agreement provides for a five-year $25.0 million revolving credit facility (the “Credit Facility”) that now matures on June 30, ~~2027~~2030. Borrowings under the Credit Facility are subject to a borrowing base requirement based on eligible receivables, inventory and cash. As of March 31, ~~2025~~2026, the borrowing base supported approximately $15.06 million of availability under the Credit Facility with $73.0 million drawn against that availability. As of March 31, ~~2024~~2025, the borrowing base supported approximately $2015.10 million of availability under the Credit Facility with $107.0 million drawn against that availability.

The credit agreement is secured by a first lien security interest in substantially all of our assets.

Borrowings under the credit agreement are permitted in the form of SOFR or prime rate-based loans and generally bear interest at floating rates plus an applicable margin determined by reference to our availability under the Credit Agreement. Among other fees, we are required to pay an annual facility fee of $15,000 and a fee of 25 basis points on the unused portion of the Credit Facility.36

Borrowings under the credit agreement are permitted in the form of SOFR or prime rate-based loans and generally bear interest at floating rates plus an applicable margin determined by reference to our availability under the credit agreement. Among other fees, we are required to pay an annual facility fee of $15,000 and a fee of 25 basis points on the unused portion of the Credit Facility.

The credit agreement includes a springing minimum fixed cost coverage ratio of 1.0 to 1.0 when excess availability under the Credit Facility falls below $4.0 million of the committed facility. Currently, the required springing minimum fixed cost coverage ratio is not required.

The credit agreement also contains customary events of default and other covenants, including certain restrictions on our ability to incur additional indebtedness, consolidate or merge, enter into acquisitions, pay any dividend or distribution on our stock, redeem, retire or purchase shares of our stock, make investments or pledge or transfer assets. If an event of default under the credit agreement occurs and is continuing, then the lender may cease making advances under the credit agreement and declare any outstanding obligations under the credit agreement to be immediately due and payable. In addition, if we become the subject of voluntary or involuntary proceedings under any bankruptcy or similar law, then any outstanding obligations under the credit agreement will automatically become immediately due and payable.

Effective April 22, 2024, we, along with our lender, executed Amendment No. 2 (“Amendment No. 2”) to the credit agreement. The primary purpose of Amendment No. 2 was to add a $3.525 million mortgage loan facility to the credit agreement secured by our office headquarters property in Manitowoc, Wisconsin. Amendment No. 2 also broadened the definition of receivables to encompass government receivables as being eligible to be included in our borrowing base calculation for the purpose of establishing our monthly borrowing availability under the credit agreement. Quarterly installments of $88,125 are due on the first day of each fiscal quarter ~~beginning October 1, 2024~~.

Effective October 30, 2024, we and our lender, executed Amendment No. 3 ("Amendment No. 3") to our ~~Credit~~credit ~~Agreement~~agreement. The primary purpose of Amendment No. 3 was to extend the maturity date of the Credit Facility from December 29, 2025 to June 30, 2027.

~~Voltrek~~On ~~Earn-Out~~September 30, 2025, we and our lender executed Amendment No. 4 to our credit agreement, pursuant to which Bank of America consented to certain subordinated liens we granted in favor of Final Frontier and consented to the Remaining Earnout Amount evidenced by the Subordinated Loan Agreement, subject to certain limitations, and to permit us to make cash interest and principal payments to Final Frontier as set forth in the Subordinated Loan Agreement. On March 18, 2026, the Subordinated Loan Agreement was terminated and cancelled, and all related liens and security interests held by Final Frontier on our assets were automatically terminated and irrevocably released.

~~Effective~~On onMarch ~~October 5~~17, ~~2022~~2026, we ~~acquired~~entered ~~all~~into of the ~~outstanding~~Settlement ~~membership~~Agreement ~~interests~~with ofFinal ~~Voltrek,~~Frontier aand ~~leading~~the ~~electric~~Connors ~~vehicle~~Parties, ~~charging~~in ~~company~~order ~~that~~to ~~provides~~reach ~~turnkey~~a ~~installation~~final ~~solutions~~and ~~with~~complete ~~ongoing~~resolution ~~support~~and tosettlement ~~all~~of ~~commercial~~the ~~verticals.~~dispute ~~The~~between ~~initial~~the ~~purchase~~Connors ~~price~~Parties ~~consisted~~and ofus ~~$5.0~~regarding ~~million~~our ~~cash~~remaining ~~and~~earnout ~~$1.0~~obligations ~~million~~owed ofto ~~common~~Final ~~stock.~~Frontier Wepursuant ~~also~~to ~~paid~~the ~~$3.0~~MIPA, ~~million~~pursuant into ~~initial~~which ~~earn-out~~we ~~payments~~acquired ~~based~~Voltrek, onas ~~Voltrek’s~~well ~~financial~~as ~~performance~~to inreach ~~fiscal~~a ~~2023.~~final Weand ~~may~~complete ~~owe~~resolution ~~additional~~and ~~material~~settlement ~~earn-out~~of ~~payments~~related ~~based~~arbitrations onand ~~Voltrek’s~~terminate ~~financial~~related agreements, as described below.

41Under the terms of the Settlement Agreement, we made a one-time cash payment of the Settlement Amount to Final Frontier on March 18, 2026. Upon receipt of the Settlement Amount, all earn out payment obligations, the MIPA, all related earnout agreements, including the Subordinated Loan Agreement, the CPA Firm Arbitration and the AAA Arbitration proceedings were terminated, cancelled and released, and all liens and security interests held by Final Frontier on our assets were automatically terminated and irrevocably released. Additionally, upon payment of the Settlement Amount, we and the Connors Parties exchanged mutual general releases of all claims arising from or related to the earn out disputes, the CPA Firm Arbitration and the AAA Arbitration proceedings, the MIPA and the related earnout agreements. The releases did not affect Ms. Connors’ then part-time employment relationship with us or the Connors Parties’ rights as our shareholders. We also agreed to facilitate the Connors Parties’ entry into a Rule 10b5-1 trading plan during our next insider open window period to facilitate the Connors Parties’ sale of their shares of our common stock.

~~performance~~On inMay ~~fiscal~~29, ~~2025~~2026, we and our lender executed Amendment No. We5 ~~have~~to ~~currently~~our ~~accrued~~credit anagreement ~~estimated~~to ~~liability~~extend the maturity date of ~~approximately~~the ~~$3.3~~Credit ~~million~~Facility ~~for~~from ~~such~~June ~~remaining~~30, ~~earn-out~~2027 ~~payments.~~to June 30, 2030.

~~The~~Public ~~final earn-out amount determined to be owed by us could be in excess of our current accrued liability for such earn-out amount and could materially adversely affect our future liquidity.~~ Offering

Capital Spending

Our capital expenditures are primarily for general corporate purposes for our corporate headquarters and technology center, production equipment and tooling and for information technology systems. Our capital expenditures totaled $0.1 million in fiscal ~~2025~~2026, $0.81 million in fiscal ~~2024~~2025 and $0.78 million in fiscal ~~2023~~2024. Our capital spending plans predominantly consist of investments related to maintenance fleet vehicles, new product development tooling and equipment and information technology systems, exclusive of any capital spending for potential acquisitions. We expect to finance these capital expenditures primarily through our existing cash, equipment secured loans and leases, to the extent needed, long-term debt financing, or by using our Credit Facility. As discussed in Item 1A. Risk Factors, we will be commencing implementation efforts of a new ERP system in fiscal ~~2026~~2027, with an expected go-live date inat the ~~first~~beginning of the second quarter of fiscal 2027. The expected cost for the project is approximately $12.~~4 million, which consists of $1.1 million of capital and $~~0.3 million ~~of expense~~.

Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of our consolidated financial statements requires us to make certain estimates and judgments that affect our reported assets, liabilities, revenue and expenses, and our related disclosure of contingent assets and liabilities. We re-evaluate our estimates on an ongoing basis, including those related to revenue recognition, inventory valuation, collectability of receivables, stock-based compensation, warranty reserves and income taxes. We base our estimates on historical experience and on various assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates. A summary of our critical accounting estimates is set forth below.

Revenue Recognition. We recognize revenue in accordance with the guidance in “Revenue from Contracts with Customers” (Topic 606) (“ASC 606”) when control of the goods or services being provided (which we refer to as a performance obligation) is transferred to a customer at an amount that reflects the consideration we expect to receive in exchange for those goods or services. The amount of expected consideration includes estimated deductions and early payment discounts calculated based on historical experience, customer rebates based on agreed upon terms applied to actual and projected sales levels over the rebate period, and any amounts paid to customers in conjunction with fulfilling a performance obligation.

If there are multiple performance obligations in a single contract, the contract’s total transaction price per GAAP is allocated to each individual performance obligation based on their relative standalone selling price. A performance obligation’s standalone selling price is the price at which we would sell such promised good or service separately to a customer. We use an observable price to determine the stand-alone selling price for separate performance obligations or an expected cost-plus margin per GAAP approach when one is not available. When the expected cost-plus margin approach is used to determine the estimated stand-alone selling price it is based on average historical margins for that performance obligation in contracts with similar customers.

Revenue derived from customer contracts which include performance obligation(s) for the sale of lighting fixtures and components we manufacture, lighting fixtures we source, and EV charging stations and related software and warranty arrangements we source, are classified as product revenue in the ~~Consolidated~~consolidated ~~Statements~~statements of ~~Operations~~operations. The revenue for these transactions is recorded at the point in time when management believes that the customer obtains control of the products, generally either upon shipment or upon delivery to the customer’s facility. This point in time is determined separately for each contract and requires judgment by management of the contract terms and the specific facts and circumstances concerning the transaction.

Revenue from a customer contract which includes both the sale of ~~Orion~~our manufactured or sourced fixtures and the installation of such fixtures (which we refer to as a turnkey project) is allocated between each lighting fixture and the installation performance obligation based on relative standalone selling prices.

Revenue from turnkey projects that is allocated to the single installation performance obligation is reflected in Service revenue. Service revenue is recorded over-time as we fulfill our obligation to install the light fixtures. We measure our performance toward fulfilling our performance obligations for installations using an output method that calculates the number of light fixtures completely removed and installed as of the measurement date in comparison to the total number of light fixtures to be removed and installed under the contract.

Revenue from the maintenance offering that includes both the sale of ~~Orion~~our manufactured or sourced product and service is allocated between the product and service performance obligations based on relative standalone selling prices, and is recorded in Product revenue and Service revenue, respectively, in the ~~Consolidated~~consolidated ~~Statement~~statement of ~~Operations~~operations.

The sale of installation and services related to the EV charging business is presented in Service revenue. Revenue from the EV segment that includes both the sale of product and service is allocated between the product and service performance obligations based on relative standalone selling prices, and is recorded in Product revenue and Service revenue, respectively, in the ~~Consolidated~~consolidated ~~Statement~~statement of ~~Operations~~operations.

~~Inventory~~Inventories, Net. Inventories consist of raw materials and components, such as drivers, metal sheet and coil stock and molded parts; work in process inventories, such as frames and reflectors; and finished goods, including completed fixtures and systems, and accessories. All inventories are stated at the lower of cost or net realizable value with cost determined using the first-in, first-out (FIFO) method. In determining the lower of cost or net realizable value, we consider assumptions such as business and economic conditions, expected demand for our products, changes in technology or customer requirements, recent historical sales activity (including usage in the preceding 9 to 12 months) and selling prices, as well as estimates of future selling prices. When the net realizable value of inventories exceeds the carrying value, ~~Orion~~we ~~records~~record, as a charge to cost of product revenue, the amount required to reduce the carrying value of inventory to net realizable value.

Recoverability of Long-Lived Assets. We evaluate long-lived assets such as property, equipment and definite lived intangible assets, such as patents, for impairment whenever events or circumstances indicate that the carrying value of the assets recognized in our financial statements may not be recoverable. Factors that we consider include whether there has been a significant decrease in the market value of an asset, a significant change in the way an asset is being utilized, or a significant change, delay or departure in our strategy for that asset, or a significant change in the macroeconomic environment. Our assessment of the recoverability of long-lived assets involves significant judgment and estimation. These assessments reflect our assumptions, which, we believe, are consistent with the assumptions hypothetical marketplace participants use. Factors that we must estimate when performing recoverability and impairment tests include, among others, forecasted revenue, margin costs and the economic life of the asset. If impairment is indicated, we determine if the total estimated future cash flows on an undiscounted basis are less than the carrying amounts of the asset or assets. If so, an impairment loss is measured and recognized.

estimated future cash flows on an undiscounted basis are less than the carrying amounts of the asset or assets. If so, an impairment loss is measured and recognized.

Our impairment loss calculations require that we apply judgment in identifying asset groups, estimating future cash flows, determining asset fair values, and estimating asset’s useful lives. To make these judgments, we may use internal discounted cash flow estimates, quoted market prices, when available, and independent appraisals, as appropriate, to determine fair value.

If actual results are not consistent with our assumptions and judgments used in estimating future cash flows and asset fair values, we may be required to recognize future impairment losses which could be material to our results of operations.

Indefinite Lived Intangible Assets and Goodwill. We test indefinite lived intangible assets and goodwill for impairment at least annually on the first day of our fiscal fourth quarter, or when indications of potential impairment exist. We monitor for the existence of potential impairment indicators throughout the fiscal year. Our annual impairment test may begin with a qualitative test to determine whether it is more likely than not that an indefinite lived intangible asset's carrying value is greater than its fair value. If our qualitative assessment reveals that asset impairment is more likely than not, we perform a quantitative impairment test by comparing the fair value of the indefinite lived intangible asset to its carrying value. Alternatively, we may bypass the qualitative test and initiate impairment testing with the quantitative impairment test.

We performed a qualitative assessment in conjunction with our annual impairment test of our indefinite lived intangible assets and goodwill as of January 1, 2025. These qualitative assessments considered our operating results for the first nine months of fiscal 2025 in comparison to prior years as well as its anticipated fourth quarter results and fiscal 2025 plan. As a result of the conditions that existed as of the assessment date, we determined a quantitative assessment was necessary for our maintenance segment reporting unit. We concluded that the undiscounted cash flows exceeded the carrying value for the indefinite lived intangibles and goodwill, and therefore no impairment charge was recorded. 39

We ~~performed~~perform a qualitative assessment in conjunction with our annual impairment test of our indefinite lived intangible assets and goodwill as of January 1, ~~2024~~2026. ~~These~~This qualitative ~~assessments~~assessment considered our operating results for the first nine months of fiscal ~~2024~~2026 in comparison to prior years as well as ~~its~~our anticipated fourth quarter results and fiscal ~~2024~~2026 plan. As a result of the conditions that existed as of the assessment date, we determined a quantitative assessment was necessary for our maintenance segment reporting unit. We concluded that the undiscounted cash flows exceeded the carrying value for the indefinite lived intangibles and goodwill, and therefore no impairment charge was recorded. As a result of the conditions that existed as of the assessment date, an asset impairment was not deemed to be more likely than not ~~in the lighting~~ and ~~EV segments and~~ a quantitative analysis was not required.

~~Stock-Based~~We ~~Compensation.~~performed Wea ~~currently~~qualitative ~~issue~~assessment ~~time-based~~in ~~and~~conjunction ~~performance-based~~with ~~restricted~~our ~~stock~~annual ~~awards~~impairment totest of our ~~employees,~~indefinite ~~executive~~lived ~~officers~~intangible assets and ~~directors.~~goodwill ~~Prior~~as toof ~~fiscal~~January ~~2015~~1, we2025. ~~also~~This ~~issued~~qualitative ~~stock~~assessment ~~options~~considered toour ~~these~~operating ~~individuals.~~results Wefor ~~apply~~ the ~~provisions~~first ofnine ~~ASC~~months ~~718,~~of ~~Compensation~~fiscal -2025 ~~Stock~~in ~~Compensation,~~comparison to ~~these~~prior ~~restricted~~years ~~stock~~as ~~and~~well ~~stock~~as ~~option~~our ~~awards~~anticipated ~~which~~fourth ~~requires~~quarter usresults toand ~~expense~~fiscal ~~the~~2025 ~~estimated~~plan. ~~fair~~As ~~value~~a result of the ~~awards~~conditions ~~based~~that onexisted ~~the~~as ~~fair value~~ of the ~~award~~assessment ~~on the~~ date ~~of grant. Additionally~~, itan isasset ~~necessary~~impairment towas ~~estimate~~not ~~the~~deemed ~~achievement of the performance-based awards~~ to ~~ensure~~be ~~the~~more ~~expense~~likely ~~remains~~than ~~accurate.~~not ~~Compensation~~and ~~costs for equity incentives are recognized in earnings, on~~ a ~~straight-line~~quantitative ~~basis~~analysis ~~over~~was ~~the~~not ~~requisite service period~~required.

Stock-Based Compensation. We currently issue time-based and performance-based restricted stock awards to our employees, consultants, executive officers and directors. In fiscal 2026, we also issued stock options to certain employees, consultants, and executive officers. We apply the provisions of ASC 718, Compensation - Stock Compensation, to these restricted stock and stock option awards which requires us to expense the estimated fair value of the awards based on the fair value of the award on the date of grant. Additionally, it is necessary to estimate the achievement of the performance-based awards to ensure the expense remains accurate. Compensation costs for equity incentives are recognized in earnings, on a straight-line basis over the requisite service period.

Accounting for Income Taxes. As part of the process of preparing our consolidated financial statements, we are required to determine our income taxes in each of the jurisdictions in which we operate. This process involves estimating our actual current tax expenses, together with assessing temporary differences resulting from recognition of items for income tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included within our consolidated balance sheet. We must then assess the likelihood that our deferred tax assets will be recovered from future taxable income and, to the extent we believe that recovery is not likely, establish a valuation allowance. To the extent we establish a valuation allowance or increase this allowance in a period, we must reflect this increase as an expense within the tax provision in our statements of operations.

Our judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, and any valuation allowance recorded against our net deferred tax assets. We continue to monitor the realizability of our deferred tax assets and adjust the valuation allowance accordingly. During fiscal 2023, we established a full valuation allowance on our net deferred tax assets due to end of the period of sustained profitability. In making these determinations, we considered all available positive and negative evidence, including projected future taxable income, tax planning strategies, recent financial performance and ownership changes.

valuation allowance accordingly. During fiscal 2023, we established a full valuation allowance on our net deferred tax assets due to end of the period of sustained profitability. In making these determinations, we considered all available positive and negative evidence, including projected future taxable income, tax planning strategies, recent financial performance and ownership changes.

We believe that past issuances and transfers of our stock caused an ownership change in fiscal 2007 that affected the timing of the use of our net operating loss carry-forwards, but we do not believe the ownership change affects the use of the full amount of the net operating loss carry-forwards. As a result, our ability to use our net operating loss carry-forwards attributable to the period prior to such ownership change to offset taxable income will be subject to limitations in a particular year, which could potentially result in increased future tax liability for us.

As of March 31, ~~2025~~2026, we had net operating loss carryforwards of approximately $8587.42 million for federal tax purposes, $7673.14 million for state tax purposes, and $0.76 million for foreign tax purposes.

We also had federal tax credit carryforwards of $1.21 million and state tax credit carryforwards of $0.21 million, which are reserved for as part of our valuation allowance. Of these tax attributes, $3637.28 million of the federal and state net operating loss carryforwards are not subject to time restrictions on use but may only be used to offset 80% of future adjusted taxable income. The $~~126~~123.04 million net operating loss and tax credit carryforwards will begin to expire in varying amounts between ~~2025~~2026 and ~~2045~~2056.

We recognize penalties and interest related to uncertain tax liabilities in income tax expense. Penalties and interest were immaterial as of the date of adoption and are included in unrecognized tax benefits.

By their nature, tax laws are often subject to interpretation. Further complicating matters is that in those cases where a tax position is open to interpretation, differences of opinion can result in differing conclusions as to the amount of tax benefits to be recognized under Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 740, Income Taxes. ASC 740 utilizes a two-step approach for evaluating tax positions. Recognition (Step 1) occurs when an enterprise concludes that a tax position, based solely on its technical merits, is more likely than not to be sustained upon examination. Measurement (Step 2) is only addressed if Step 1 has been satisfied. Under Step 2, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis that is more likely than not to be realized upon ultimate settlement. Consequently, the level of evidence and documentation necessary to support a position prior to being given recognition and measurement within the financial statements is a matter of judgment that depends on all available evidence. As of March 31, 2025, the balance of gross unrecognized tax benefits was approximately $0.2 million, all of which would reduce our effective tax rate if recognized. We believe that our estimates and judgments discussed herein are reasonable, however, actual results could differ, which could result in gains or losses that could be material.40

By their nature, tax laws are often subject to interpretation. Further complicating matters is that in those cases where a tax position is open to interpretation, differences of opinion can result in differing conclusions as to the amount of tax benefits to be recognized under Financial Accounting Standards Board ("FASB") ASC 740, Income Taxes. ASC 740 utilizes a two-step approach for evaluating tax positions. Recognition (Step 1) occurs when an enterprise concludes that a tax position, based solely on its technical merits, is more likely than not to be sustained upon examination. Measurement (Step 2) is only addressed if Step 1 has been satisfied. Under Step 2, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis that is more likely than not to be realized upon ultimate settlement. Consequently, the level of evidence and documentation necessary to support a position prior to being given recognition and measurement within the financial statements is a matter of judgment that depends on all available evidence. As of March 31, 2026, the balance of gross unrecognized tax benefits was approximately $0.2 million, all of which would reduce our effective tax rate if recognized. We believe that our estimates and judgments discussed herein are reasonable, however, actual results could differ, which could result in gains or losses that could be material.

Recent Accounting Pronouncements

See Note 32 – Summary of Significant Accounting Policies to our accompanying audited consolidated financial statements for a full description of recent accounting pronouncements including the respective expected dates of adoption and expected effects on results of operations and financial condition.

Item 7A. Quantitative and Qualitative Disclosure About Market Risk

Market risk is the risk of loss related to changes in market prices, including interest rates, foreign exchange rates and commodity pricing that may adversely impact our consolidated financial position, results of operations or cash flows.

Inflation. We have experienced increases in various input costs including labor, components and transportation in the past year. In response, we have implemented multiple price increases, and we have substantially mitigated the inflationary pressures, such that our results from operations have not been materially affected by inflation. We are monitoring input costs and cannot currently predict the future impact to our operations by inflation.

Foreign Exchange Risk. We face minimal exposure to adverse movements in foreign currency exchange rates. Our foreign currency losses for all reporting periods have been nominal.

Interest Rate Risk. We do not believe that we are subject to any material risks arising from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices or other market changes that affect market risk sensitive instruments. It is our policy not to enter into interest rate derivative financial instruments. As a result, we do not currently have any significant interest rate exposure.

As of March 31, ~~2025~~2026, we had $106.30 million of outstanding debt with floating interest rates.

Commodity Price Risk. We are exposed to certain commodity price risks associated with our purchases of raw materials, most significantly our aluminum purchases. During fiscal ~~2025~~2026, we have experienced commodity price increases; however, as of the date of this report, we are not able to predict the future impact of on this risk. A hypothetical additional 20% increase in aluminum prices would have had a negative impact of $0.79 million on our net ~~income~~loss in fiscal ~~2025~~2026.

4641

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	PageNumber
Report of Independent Registered Public Accounting Firm (BDO USA, P.C.; Milwaukee, WI; PCAOB ID#243)	4843
Consolidated Balance Sheets	5045
Consolidated Statements of Operations	5146
Consolidated Statements of Shareholders’ Equity	5247
Consolidated Statements of Cash Flows	5348
Notes to Consolidated Financial Statements	5449

4742

Report of Independent Registered Public Accounting Firm

Shareholders and Board of Directors

Orion Energy Systems, Inc.

Manitowoc, Wisconsin

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Orion Energy Systems, Inc. (the “Company”) as of March 31, ~~2025~~2026 and ~~2024~~2025, the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended March 31, ~~2025~~2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, ~~2025~~2026 and ~~2024~~2025, and the results of its operations and its cash flows for each of the three years in the period ended March 31, ~~2025~~2026, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Inventory - Valuation

As described in Note 2 to the Company’s consolidated financial statements, the Company reports inventory using the first-in, first-out (FIFO) method. The Company records the amount required to reduce the carrying value of its inventories to net realizable value as a charge to cost of product revenue. As of March 31, ~~2025~~2026, the Company had ~~inventory~~inventories, net of approximately $1110.43 million.

We identified Inventory Valuation as a critical audit matter. The principal considerations for this determination were management’s judgments utilized to determine the net realizable value of inventory, specifically the assumptions related to the recent historical sales activity (including usage in the preceding 9 to 12 months) and expected demand for the products. Auditing these elements involved especially subjective auditor judgment due to the nature and extent of audit effort required to address this matter.

4843

significant judgments utilized to determine the net realizable value of inventory, specifically the assumptions related to the recent historical sales activity (including usage in the preceding 9 to 12 months) and expected demand for the products. Auditing these elements involved especially subjective auditor judgment due to the nature and extent of audit effort required to address this matter.

The primary procedures we performed to address this critical audit matter included:

•

Assessing the reasonableness of management’s assumptions over historical sales activity, including testing the completeness and accuracy of underlying data and corroborating management’s considerations of usage trends during the preceding 9 to 12 months, on a sample basis.

•

Assessing the reasonableness of management’s assumptions over expected demand for products, by comparing parts identified for substitutions when applicable and testing usage subsequent to year-end and other subsequent transactions, on a sample basis.

/s/ BDO USA, P.C.

We have served as the Company's auditor since 2011.

Milwaukee, Wisconsin

June 264, ~~2025~~2026

4944

ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share amounts)


	March 31,
(in thousands, except share amounts)	2026			2025
Assets
Cash and cash equivalents	$	3,265		$	5,972
Accounts receivable, net		16,340			12,845
Revenue earned but not billed		6,409			3,350
Inventories, net		10,304			11,392
Prepaid expenses and other current assets		1,364			1,939
Total current assets		37,682			35,498
Property and equipment, net		6,114			8,026
Goodwill		1,484			1,484
Other intangible assets, net		2,646			3,379
Other long-term assets, net		3,679			4,076
Total assets	$	51,605		$	52,463
Liabilities and Shareholders’ Equity
Accounts payable	$	15,451		$	13,272
Accrued expenses and other		10,728			12,728
Deferred revenue, current		155			491
Current maturities of long-term debt		353			353
Total current liabilities		26,687			26,844
Revolving credit facility		3,000			7,000
Long-term debt, less current maturities		2,619			2,971
Deferred revenue, long-term		-			337
Other long-term liabilities		2,671			3,427
Total liabilities		34,977			40,579
Commitments and contingencies (Note 14)
Shareholders’ equity:
Preferred stock, $0.01 par value: Shares authorized: 30,000,000 shares at March 31, 2026 and 2025; no shares issued and outstanding at March 31, 2026 and 2025		—			—
Common stock, no par value: Shares authorized: 20,000,000 at March 31, 2026 and 2025; shares issued: 4,819,013 and 4,247,023 at March 31, 2026 and 2025; shares outstanding: 4,056,528 and 3,298,389 at March 31, 2026 and 2025		—			—
Additional paid-in capital		169,646			163,025
Treasury stock: 762,485 and 948,634 common shares at March 31, 2026 and 2025		(34,962	)		(36,248	)
Accumulated deficit		(118,056	)		(114,893	)
Total shareholders’ equity		16,628			11,884
Total liabilities and shareholders’ equity	$	51,605		$	52,463

	March 31,
	2025			2024
Assets
Cash and cash equivalents	$	5,972		$	5,155
Accounts receivable, net		12,845			14,022
Revenue earned but not billed		3,350			4,539
Inventories		11,392			18,246
Prepaid expenses and other current assets		1,939			2,860
Total current assets		35,498			44,822
Property and equipment, net		8,026			9,593
Goodwill		1,484			1,484
Other intangible assets, net		3,379			4,462
Other long-term assets		4,076			2,808
Total assets	$	52,463		$	63,169
Liabilities and Shareholders’ Equity
Accounts payable	$	13,272		$	18,350
Accrued expenses and other		12,728			9,440
Deferred revenue, current		491			260
Current maturities of long-term debt		353			3
Total current liabilities		26,844			28,053
Revolving credit facility		7,000			10,000
Long-term debt, less current maturities		2,971			—
Deferred revenue, long-term		337			413
Other long-term liabilities		3,427			2,161
Total liabilities		40,579			40,627
Commitments and contingencies (Note 14)
Shareholders’ equity:
Preferred stock, $0.01 par value: Shares authorized: 30,000,000 shares at March 31, 2025 and 2024; no shares issued and outstanding at March 31, 2025 and 2024		—			—
Common stock, no par value: Shares authorized: 200,000,000 at March 31, 2025 and 2024; shares issued: 42,470,231 and 42,038,967 at March 31, 2025 and 2024; shares outstanding: 32,983,888 and 32,567,746 at March 31, 2025 and 2024		—			—
Additional paid-in capital		163,025			161,869
Treasury stock: 9,486,343 and 9,471,221 common shares at March 31, 2025 and 2024		(36,248	)		(36,235	)
Retained deficit		(114,893	)		(103,092	)
Total shareholders’ equity		11,884			22,542
Total liabilities and shareholders’ equity	$	52,463		$	63,169

The accompanying notes are an integral part of these Consolidated Financial Statements.

5045

ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)


	Fiscal Year Ended March 31,
(in thousands, except share and per share amounts)	2026			2025			2024
Product revenue	$	57,029		$	54,368		$	63,307
Service revenue		29,277			25,352			27,274
Total revenue		86,306			79,720			90,581
Cost of product revenue		36,893			37,319			44,466
Cost of service revenue		21,320			22,165			25,204
Total cost of revenue		58,213			59,484			69,670
Gross profit		28,093			20,236			20,911
Operating expenses:
General and administrative		18,691			18,008			16,740
Impairment on intangibles		—			—			456
Acquisition related costs		—			—			56
Sales and marketing		10,099			11,595			12,988
Research and development		945			1,229			1,495
Total operating expenses		29,735			30,832			31,735
Loss from operations		(1,642	)		(10,596	)		(10,824	)
Other income (expense):
Other income		51			62			39
Interest expense		(783	)		(1,026	)		(752	)
Amortization of debt issue costs		(170	)		(206	)		(95	)
Loss on debt extinguishment		(562	)		—			—
Interest income		3			7			2
Total other expense		(1,461	)		(1,163	)		(806	)
Loss before income tax		(3,103	)		(11,759	)		(11,630	)
Income tax expense		60			42			41
Net loss	$	(3,163	)	$	(11,801	)	$	(11,671	)
Basic net loss per share attributable to common shareholders	$	(0.89	)	$	(3.59	)	$	(3.59	)
Weighted-average common shares outstanding		3,560,671			3,282,947			3,248,624
Diluted net loss per share	$	(0.89	)	$	(3.59	)	$	(3.59	)
Weighted-average common shares and share equivalents outstanding		3,560,671			3,282,947			3,248,624

	Fiscal Year Ended March 31,
	2025			2024			2023
Product revenue	$	54,368		$	63,307		$	57,210
Service revenue		25,352			27,274			20,173
Total revenue		79,720			90,581			77,383
Cost of product revenue		37,319			44,466			42,979
Cost of service revenue		22,165			25,204			16,893
Total cost of revenue		59,484			69,670			59,872
Gross profit		20,236			20,911			17,511
Operating expenses:
General and administrative		18,008			16,740			19,487
Impairment on Intangibles		—			456			—
Acquisition related costs		—			56			765
Sales and marketing		11,595			12,988			11,392
Research and development		1,229			1,495			1,852
Total operating expenses		30,832			31,735			33,496
Loss from operations		(10,596	)		(10,824	)		(15,985	)
Other income (expense):
Other income		62			39			—
Interest expense		(1,026	)		(752	)		(339	)
Amortization of debt issue costs		(206	)		(95	)		(73	)
Interest income		7			2			34
Total other expense		(1,163	)		(806	)		(378	)
Loss before income tax		(11,759	)		(11,630	)		(16,363	)
Income tax expense		42			41			17,978
Net loss	$	(11,801	)	$	(11,671	)	$	(34,341	)
Basic net loss per share attributable to common shareholders	$	(0.36	)	$	(0.36	)	$	(1.08	)
Weighted-average common shares outstanding		32,829,470			32,486,240			31,703,712
Diluted net loss per share	$	(0.36	)	$	(0.36	)	$	(1.08	)
Weighted-average common shares and share equivalents outstanding		32,829,470			32,486,240			31,703,712

The accompanying notes are an integral part of these Consolidated Financial Statements.

5146

ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES

STATEMENTS OF SHAREHOLDERS’ EQUITY

(in thousands, except share amounts)


	Shareholders’ Equity
	Common Stock
(in thousands, except share amounts)	Shares			Additional Paid-in Capital		Treasury Stock			Accumulated Deficit			Total Shareholders’ Equity
Balance, March 31, 2023		3,229,541		$	160,907	$	(36,237	)	$	(91,421	)	$	33,249
Issuance of stock and shares for services		1,132			12		—			—			12
Shares issued under Employee Stock Purchase Plan		282			—		4			—			4
Stock-based compensation		26,055			950		—			—			950
Employee tax withholdings on stock-based compensation		(235	)		—		(2	)		—			(2	)
Net loss		—			—		—			(11,671	)		(11,671	)
Balance, March 31, 2024		3,256,775			161,869		(36,235	)		(103,092	)		22,542
Shares issued under Employee Stock Purchase Plan		193			—		2			—			2
Stock-based compensation		43,126			1,156		—			—			1,156
Employee tax withholdings on stock-based compensation		(1,705	)		—		(15	)		—			(15	)
Net loss		—			—		—			(11,801	)		(11,801	)
Balance, March 31, 2025		3,298,389			163,025		(36,248	)		(114,893	)		11,884
Public stock offering, net of issuance costs		500,000			6,138		—			—			6,138
Issuance of stock for earnout payment		164,908			—		1,000			—			1,000
Issuance of stock for sign on bonus		21,166			—		300			—			300
Shares issued under Employee Stock Purchase Plan		75			—		1			—			1
Stock-based compensation		73,336			483		—			—			483
Employee tax withholdings on stock-based compensation		(1,346	)		—		(15	)		—			(15	)
Net loss		—			—		—			(3,163	)		(3,163	)
Balance, March 31, 2026		4,056,528		$	169,646	$	(34,962	)	$	(118,056	)	$	16,628

	Shareholders’ Equity
	Common Stock
	Shares			AdditionalPaid-in Capital		TreasuryStock			RetainedEarnings (Deficit)			TotalShareholders’ Equity
Balance, March 31, 2022		31,097,872		$	158,419	$	(36,239	)	$	(57,080	)	$	65,100
Issuance of common stock for acquisition		620,067			800		—			—			800
Issuance of stock and shares for services		12,848			22		—			—			22
Exercise of stock options for cash		26,646			54		—			—			54
Shares issued under Employee Stock Purchase Plan		2,274			—		4			—			4
Stock-based compensation		536,622			1,612		—			—			1,612
Employee tax withholdings on stock-based compensation		(921	)		—		(2	)		—			(2	)
Net loss		—			—		—			(34,341	)		(34,341	)
Balance, March 31, 2023		32,295,408			160,907		(36,237	)		(91,421	)		33,249
Issuance of stock and shares for services		11,320			12		—			—			12
Shares issued under Employee Stock Purchase Plan		2,817			—		4			—			4
Stock-based compensation		260,555			950		—			—			950
Employee tax withholdings on stock-based compensation		(2,354	)		—		(2	)		—			(2	)
Net loss		—			—		—			(11,671	)		(11,671	)
Balance, March 31, 2024		32,567,746			161,869		(36,235	)		(103,092	)		22,542
Shares issued under Employee Stock Purchase Plan		1,932			—		2			—			2
Stock-based compensation		431,264			1,156		—			—			1,156
Employee tax withholdings on stock-based compensation		(17,054	)		—		(15	)		—			(15	)
Net loss		—			—		—			(11,801	)		(11,801	)
Balance, March 31, 2025		32,983,888		$	163,025	$	(36,248	)	$	(114,893	)	$	11,884

The accompanying notes are an integral part of these Consolidated Financial Statements.

5247

ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)


	Fiscal Year Ended March 31,
(in thousands)	2026			2025			2024
Operating activities
Net loss	$	(3,163	)	$	(11,801	)	$	(11,671	)
Adjustments to reconcile net loss to net cash (used in) provided by
operating activities:
Depreciation and amortization		1,784			2,619			2,590
Stock-based compensation		483			1,157			950
Loss on debt extinguishment		562			—			—
Deferred taxes and impairment of property and equipment		5			27			64
Loss on asset disposals		1,118			91			84
Provision for inventory reserves		461			552			562
Provision for credit losses		12			378			170
Other		(6	)		197			468
Changes in operating assets and liabilities:
Accounts receivable		(3,507	)		800			(464	)
Revenue earned but not billed		(3,059	)		1,189			(3,219	)
Inventories		627			6,106			(603	)
Prepaid expenses and other assets		802			2,324			(1,384	)
Accounts payable		2,179			(5,078	)		4,990
Accrued expenses and other liabilities		1,296			1,883			(2,334	)
Deferred revenue, current and long-term		(673	)		155			(295	)
Net cash provided by (used in) operating activities		(1,079	)		599			(10,092	)
Investing activities
Purchase of property and equipment		(83	)		(99	)		(837	)
Additions to patents and licenses		(3	)		(6	)		—
Proceeds from sales of property and equipment		—			233			106
Net cash provided by (used in) investing activities		(86	)		128			(731	)
Financing activities
Payment of long-term debt		(3,403	)		(206	)		(15	)
Proceeds from revolving credit facility		4,250			500			—
Payment of revolving credit facility		(8,250	)		(3,500	)		—
Proceeds from long-term debt		—			3,525			—
Unamortized debt issuance cost write-off		(180	)		—			—
Issuance of treasury stock		300			—			—
Proceeds from public stock offering, net of issuance costs		6,138			—			—
Payments to settle employee tax withholdings on stock-based compensation		(11	)		—			(2	)
Debt issue costs		(383	)		(216	)		—
Proceeds from employee equity exercises		(3	)		(13	)		3
Net cash provided by (used in) financing activities		(1,542	)		90			(14	)
Net increase (decrease) in cash and cash equivalents		(2,707	)		817			(10,837	)
Cash and cash equivalents at beginning of period		5,972			5,155			15,992
Cash and cash equivalents at end of period	$	3,265		$	5,972		$	5,155
Supplemental cash flow information:
Cash paid for interest	$	(758	)	$	(962	)	$	(691	)
Cash paid for income taxes	$	(36	)	$	(26	)	$	(59	)
Supplemental disclosure of non-cash investing and financing activities:
Operating lease assets obtained in exchange for new operating lease liabilities	$	—		$	2,661		$	—
Issuance of common stock to Final Frontier, LLC as partial payment of earnout obligation	$	1,000		$	—		$	—
Issuance of subordinated debt for earnout obligation	$	3,051		$	—		$	—

	Fiscal Year Ended March 31,
	2025			2024			2023
Operating activities
Net loss	$	(11,801	)	$	(11,671	)	$	(34,341	)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation		1,344			1,410			1,369
Amortization of intangible assets		1,069			1,085			653
Stock-based compensation		1,157			950			1,612
Impairment on intangibles		—			456			—
Amortization of debt issue costs		206			95			73
Deferred income tax benefit		7			(5	)		17,881
Impairment of property and equipment		20			69			—
Loss on sale of property and equipment		91			84			27
Provision for inventory reserves		552			562			628
Provision for credit losses/bad debts		378			170			65
Other		197			12			96
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		800			(464	)		(586	)
Revenue earned but not billed		1,189			(3,219	)		1,426
Inventories		6,106			(603	)		1,879
Prepaid expenses and other assets		2,324			(1,384	)		2,017
Accounts payable		(5,078	)		4,990			2,372
Accrued expenses and other liabilities		1,883			(2,334	)		2,209
Deferred revenue, current and long-term		155			(295	)		329
Net cash provided by (used in) operating activities		599			(10,092	)		(2,291	)
Investing activities
Cash to fund acquisitions, net of cash received		—			—			(5,600	)
Purchase of property and equipment		(99	)		(837	)		(586	)
Additions to patents and licenses		(6	)		—			(9	)
Proceeds from sales of property, plant and equipment		233			106			—
Net cash provided by (used in) investing activities		128			(731	)		(6,195	)
Financing activities
Payment of long-term debt		(206	)		(15	)		(15	)
Proceeds from revolving credit facility		500			—			10,000
Payment of revolving credit facility		(3,500	)		—			—
Proceeds from long-term debt		3,525			—			—
Payments to settle employee tax withholdings on stock-based compensation		—			(2	)		(2	)
Debt issue costs		(216	)		—			(29	)
Proceeds from employee equity exercises		(13	)		3			58
Net cash provided by (used in) financing activities		90			(14	)		10,012
Net increase (decrease) in cash and cash equivalents		817			(10,837	)		1,526
Cash and cash equivalents at beginning of period		5,155			15,992			14,466
Cash and cash equivalents at end of period	$	5,972		$	5,155		$	15,992
Supplemental cash flow information:
Cash paid for interest	$	(962	)	$	(691	)	$	(346	)
Cash paid for income taxes	$	(26	)	$	(59	)	$	(87	)
Supplemental disclosure of non-cash investing and financing activities:
Operating lease assets obtained in exchange for new operating lease liabilities	$	2,661		$	—		$	—
Issuance of common stock in connection with acquisition	$	—		$	—		$	800

The accompanying notes are an integral part of these Consolidated Financial Statements.

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ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — DESCRIPTION OF BUSINESS

Orion includes Orion Energy Systems, Inc., a Wisconsin corporation, and all consolidated subsidiaries. Orion provides light emitting diode lighting systems, wireless Internet of Things enabled control solutions, project engineering, energy project management design, maintenance services and turnkey electric vehicle charging stations and related installation services to commercial and industrial businesses, and federal and local governments, predominantly in North America.

Orion’s corporate offices and leased primary manufacturing operations are located in Manitowoc, Wisconsin. Orion also leases office space in Jacksonville, Florida and Lawrence, Massachusetts.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The consolidated financial statements include the accounts of Orion Energy Systems, Inc. and its wholly-owned subsidiaries. All ~~significant~~ intercompany transactions and balances have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during that reporting period. Areas that require the use of ~~significant~~ management estimates include revenue recognition, net realizable value of inventory, allowance for credit losses, accruals for warranty and loss contingencies, ~~earn-out~~earnout, income taxes, impairment analyses, and certain equity transactions. Accordingly, actual results could differ from those estimates.

Cash and Cash Equivalents

Orion considers all highly liquid, short-term investments with original maturities of three months or less to be cash equivalents.

Fair Value of Financial Instruments

Orion’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other, revolving credit facility and ~~long-term~~ debt. In addition, other long-term assets, net includes an equity investment of $0.5 million that is carried at cost less impairment, of which there has been no impairment as of March 31, 2026, 2025, and 2024. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. GAAP describes a fair value hierarchy based on the following three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value:

Level 1 — Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly.

Level 3 — Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management's best estimate of what market participants would use in valuing the asset or liability at the measurement date.

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The carrying amounts of Orion’s financial instruments and debt approximate their respective fair values due to the relatively short-term nature of these instruments. ~~Long-term~~Orion's debt ~~and~~is ~~revolving credit facility are~~ considered Level 2 and ~~are~~is reflected in the consolidated balance ~~sheet~~sheets at carrying value, which approximate fair value because the stated interest rates are similar to interest rates currently available to Orion for similar obligations.

Allowance for Credit Losses

Orion performs ongoing evaluations of its customers and continuously monitors collections and payments. Orion estimates an allowance for credit losses based upon the historical collectability based on past due status and makes judgments about the creditworthiness of customers based on ongoing credit evaluations. WeOrion also ~~consider~~considers customer-specific information, current market conditions, and reasonable and supportable forecasts of future economic conditions. ~~See Note 4 – Accounts Receivable for further discussion of the allowance for credit losses.~~

~~Inventory~~Inventories, Net

Inventories consist of raw materials and components, such as drivers, metal sheet and coil stock and molded parts; work in process inventories, such as frames and reflectors; and finished goods, including completed fixtures and systems, and accessories. All inventories are stated at the lower of cost or net realizable value with cost determined using the first-in, first-out (FIFO) method. In determining the lower of cost or net realizable value, we consider assumptions such as business and economic conditions, expected demand for our products, changes in technology or customer requirements, recent historical sales activity (including usage in the preceding 9 to 12 months) and selling prices, as well as estimates of future selling prices. When the net realizable value of inventories exceeds the carrying value, Orion records, as a charge to ~~cost~~Cost of product revenue, the amount required to reduce the carrying value of inventory to net realizable value.

Incentive Plan

Orion’s human capital management and compensation committee annually approves an executive annual cash incentive program. Based upon the results for the fiscal years ended March 31, ~~2025~~2026, ~~2024~~2025, and ~~2023~~2024, Orion accrued approximately $0.1.0 million, $0.21 million and $0.2 million expense related to these programs, respectively.

Revenue Recognition

Orion generates revenues primarily by selling commercial lighting fixtures and components, installing these fixtures in its ~~customer’s~~customers' facilities, and providing maintenance services including repairs and replacements for the lighting and related electrical components deployed in its customer’s facilities. Orion recognizes revenue in accordance with the guidance in “Revenue from Contracts with Customers” (Topic 606) (“ASC 606”) when control of the goods or services being provided (which Orion refers to as a performance obligation) is transferred to a customer at an amount that reflects the consideration that management expects to receive in exchange for those goods or services. Prices are generally fixed at the time of order confirmation, either for the contract as a whole or for the hourly rates that will be charged for the type of maintenance services delivered. The amount of expected consideration includes estimated deductions and early payment discounts calculated based on historical experience, customer rebates based on agreed upon terms applied to actual and projected sales levels over the rebate period, and any amounts paid to customers in conjunction with fulfilling a performance obligation.

If there are multiple performance obligations in a single contract, the contract’s total transaction price is allocated to each individual performance obligation based on their relative standalone selling price. A performance obligation’s standalone selling price is the price at which Orion would sell such promised good or service separately to a customer. Orion uses an observable price to determine the stand-alone selling price for separate performance obligations or an expected cost-plus margin approach when one is not available. When the expected cost-plus margin approach is used to determine the estimated stand-alone selling price it is based on average historical margins for that performance obligation in contracts with similar customers.

Revenue derived from customer contracts which include only performance obligation(s) for the sale of Orion manufactured or sourced lighting fixtures and components is classified as Product revenue in the ~~Consolidated~~consolidated ~~Statements~~statements of ~~Operations~~operations. The revenue for these transactions is recorded at the point in time when management believes that the customer obtains control of the products, generally either upon shipment or upon delivery to the customer’s facility. This point in time is determined separately for each contract and requires judgment by management of the contract terms and the specific facts and circumstances concerning the transaction.

5550

for these transactions is recorded at the point in time when management believes that the customer obtains control of the products, generally either upon shipment or upon delivery to the customer’s facility. This point in time is determined separately for each contract and requires judgment by management of the contract terms and the specific facts and circumstances concerning the transaction.

Revenue from a customer contract, which includes both the sale of Orion manufactured or sourced fixtures and the installation of such fixtures (which Orion refers to as a turnkey project), is allocated between each lighting fixture and the installation performance obligation based on relative standalone selling prices.

Revenue from turnkey projects that is allocated to the sale of the lighting fixtures is recorded at the point in time when management believes the customer obtains control of the product(s) and is reflected in Product revenue. This point in time is determined separately for each customer contract based upon the terms of the contract and the nature and extent of Orion’s control of the light fixtures during the installation. Product revenue associated with turnkey projects can be recorded (a) upon shipment or delivery, (b) subsequent to shipment or delivery and upon customer payments for the light fixtures, (c) when an individual light fixture is installed and working correctly, or (d) when the customer acknowledges that the entire installation project is substantially complete. Determining the point in time when a customer obtains control of the lighting fixtures in a turnkey project is applied separately for each individual light fixture included in a contract. In making this judgment, management considers the timing of various factors, including, but not limited to, those detailed below:

•

when there is a legal transfer of ownership;

•

when the customer obtains physical possession of the products;

•

when the customer starts to receive the benefit of the products;

•

the amount and duration of physical control that Orion maintains on the products after they are shipped to, and received at, the customer’s facility;

•

whether Orion is required to maintain insurance on the lighting fixtures when they are in transit and after they are delivered to the customer’s facility;

•

when each light fixture is physically installed and working correctly;

•

when the customer formally accepts the product; and

•

when Orion receives payment from the customer for the light fixtures.

Revenue from turnkey projects that is allocated to the single installation performance obligation is reflected in Service revenue. Service revenue is recorded over-time as Orion fulfills its obligation to install the light fixtures. Orion measures its performance toward fulfilling its performance obligations for installations using an output method that calculates the number of light fixtures removed and installed as of the measurement date in comparison to the total number of light fixtures to be removed and installed under the contract.

Revenue from the maintenance offering that includes both the sale of Orion manufactured or sourced product and service is allocated between the product and service performance obligations based on relative standalone selling prices using the cost-plus margin approach, and is recorded in Product revenue and Service revenue, respectively, in the ~~Consolidated~~consolidated ~~Statement~~statement of ~~Operations~~operations.

Orion offers a financing program, called an Orion Throughput Agreement, or OTA, for a customer’s lease of Orion’s energy management systems. The OTA is structured as a sales-type lease and upon successful installation of the system and customer acknowledgment that the system is operating as specified, revenue is recognized at Orion’s net investment in the lease, which typically is the net present value of the future cash flows.

Orion also records revenue in conjunction with ~~several~~ limited power purchase agreements (“PPAs”) still outstanding. Those PPAs are supply-side agreements for the generation of electricity. Orion’s last PPA expires in 2031. Revenue associated with the sale of energy generated by the solar facilities under these PPAs is within the scope of ASC 606. Revenues are recognized over-time and are equal to the amount billed to the customer, which is calculated by applying the fixed rate designated in the PPAs to the variable amount of electricity generated each month. This approach is in accordance with the “right to invoice” practical expedient provided for in ASC 606. Orion also recognizes revenue upon the sale to third parties of tax credits received from operating the solar facilities and from amortizing a grant received from the federal government during the period starting when the power generating facilities were constructed until the expiration of the PPAs; these revenues are not derived from contracts with customers and therefore not under the scope of ASC

5651

~~electricity generated each month~~606. ~~This~~In ~~approach~~March is2026, inOrion ~~accordance~~executed ~~with~~a ~~the~~contract ~~“right~~modification ~~to invoice” practical expedient provided~~ for inits ~~ASC~~two ~~606.~~remaining ~~Orion~~PPAs ~~also~~that ~~recognizes~~immediately ~~revenue~~terminated ~~upon~~ the ~~sale~~agreements ~~to third parties of tax credits received from operating the solar facilities~~ and ~~from~~eliminated ~~amortizing~~any aremaining ~~grant~~obligations ~~received~~with ~~from~~respect ~~the~~to ~~federal~~those ~~government~~agreements. ~~during~~Orion ~~the~~recognized ~~period starting when~~ the ~~power~~$1.3 ~~generating~~million ~~facilities~~payment ~~were~~received ~~constructed~~as ~~until~~a ~~the~~contract ~~expiration~~modification ofin ~~the~~accordance ~~PPAs; these revenues are not derived from contracts~~ with ~~customers~~ASC ~~and~~606 ~~therefore~~in ~~not under~~ the ~~scope~~period of ~~ASC 606~~termination.

During the third quarter of fiscal 2023, Orion acquired Voltrek LLC ("Voltrek"), which sells and installs sourced electric vehicle charging stations and related software subscriptions and renewals. The results of Voltrek are included in the ~~Orion~~ EV segment and compliment Orion’s existing turnkey installation model.

The sale of charging stations and related software subscriptions, renewals and extended warranty is presented in Product revenue. Orion is the principal in the sales of charging stations as it has control of the physical products prior to transfer to the customer. Accordingly, revenue is recognized on a gross basis. For certain sales, primarily software subscriptions, renewals and extended warranty, Orion is the sales agent providing access to the content and recognize commission revenue net of amounts due to third parties who fulfill the performance obligation. For these sales, control passes at the point in time upon providing access of the content to the customer.

The sale of installation and services related to the EV charging business is presented in Service revenue. Revenue from the EV segment that includes both the sale of product and service is allocated between the product and service performance obligations based on relative standalone selling prices using the cost-plus margin approach, and is recorded in Product revenue and Service revenue, respectively, in the ~~Consolidated~~consolidated ~~Statement~~statement of ~~Operations~~operations.

From time to time, the EV segment enters into bill and hold arrangements, whereby the Company sells EV charging stations and the charging stations are warehoused at a Company location for a specified period of time in accordance with directions received from the Company's customers. Even though the charging stations are held at a Company location, a sale is recognized at the point in time when the customer obtains control of the product. Control is transferred to the customer in a bill and hold arrangement when: customer acceptance specifications have been met, legal title has transferred, the customer has a present obligation to pay for the product and the risk and rewards of ownership have transferred to the customer. Additionally, all the following bill and hold criteria have been met in order for control to be transferred to the customer: the reason for the bill and hold arrangement is substantive -the customer has requested the product be warehoused, the product has been identified as separately belonging to the customer, the product is currently ready for physical transfer to the customer, and the Company does not have the ability to use the product or direct it to another customer.

See Note 10 – Accrued Expenses and Other for a discussion of Orion’s accounting for the limited warranty it provides to customers for its products and services.

Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net (excluded from revenues) basis.

Contract Fulfillment Costs

Costs associated with product sales are accumulated in inventory as the fixtures are manufactured and are transferred to Cost of product revenue at the time revenue is recorded. See Note 5 – Inventories. Costs associated with installation sales are expensed as incurred.

Practical Expedients and Exemptions

Orion expenses sales commissions when incurred because the amortization period is one year or less. These costs are recorded within Sales and marketing expense. There are no other capitalizable costs associated with obtaining contracts with customers.

Orion’s performance obligations related to lighting fixtures and EV charging stations typically do not exceed nine months in duration. As a result, Orion has elected the practical expedient that provides an exemption to the disclosure requirements regarding information about value assigned to remaining performance obligations on contracts that have original expected durations of one year or less.

Orion also elected the practical expedient that permits companies to not disclose quantitative information about the future revenue when revenue is recognized as invoices are issued to customers for services performed.

Other than the turnkey projects which result in sales-type leases discussed above, Orion generally receives full payment for satisfied performance obligations in less than one year. Accordingly, Orion does not adjust revenues for the impact of any potential significant financing component as permitted by the practical expedients provided in ASC 606.

Shipping and Handling Costs

Orion records costs incurred in connection with shipping and handling of products as ~~cost~~Cost of product revenue. Amounts billed to customers in connection with these costs are included in product revenue.

Research and Development

Orion expenses research and development costs as incurred. Amounts are included in the ~~Consolidated~~consolidated ~~Statement~~statement of ~~Operations~~operations on the line item Research and development.

Leases

From time to time, Orion leases assets from third parties. Orion also leases certain assets to third parties. Leases are accounted for, and reported upon, following the requirements of ASC 842.

Whether it is the lessee or the lessor, Orion’s determination of whether a contract includes a lease, and assessing how the lease should be accounted for, is a matter of judgment based on whether the risks and rewards, as well as substantive control of the assets specified in the contract, have been transferred from the lessor to the lessee. The judgment considers matters such as whether the assets are transferred from the lessor to the lessee at the end of the contract, the term of the agreement in relation to the asset’s remaining economic useful life, and whether the assets are of such a specialized nature that the lessor will not have an alternative use for such assets at the termination of the agreement. Other matters requiring judgment are the lease term when the agreement includes renewal or termination options and the interest rate used when initially determining the Right-of-Use (ROU) asset and lease liability.

ROU assets represent Orion’s right to use an underlying asset for the lease term and lease liabilities represent Orion’s obligation to make lease payments arising from the lease. Under ASC 842, both finance and operating lease ROU assets and lease liabilities for leases with initial terms in excess of 12 months are recognized at the commencement date based on the present value of lease payments over the lease term. When available, Orion uses the implicit interest rate in the lease when completing this calculation. However, as most of Orion’s operating lease agreements generating ROU assets do not provide the implicit rate, Orion’s incremental borrowing rate under its Credit Facility, adjusted for differences in duration and the relative collateral value in relation to the payment obligation, at the commencement of the lease is generally used in this calculation. The lease term includes options to extend or renew the agreement, or for early termination of the agreement, when it is reasonably certain that Orion will exercise such option. ROU assets are depreciated using the straight-line method over the lease term.

Orion recognizes lease expense for leases with an initial term of 12 months or less, referred to as short term leases, on a straight-line basis over the lease term.

Intangible Assets

Intangible assets that have a definite life are evaluated for potential impairment whenever events or circumstances indicate that the carrying value may not be recoverable based primarily upon whether expected future undiscounted cash flows are sufficient to support the asset recovery. If the actual useful life of the asset is shorter than the estimated life, the asset may be deemed to be impaired and accordingly a write-down of the value of the asset determined by a discounted cash flow analysis or shorter amortization period may be required.

Indefinite lived intangible assets and goodwill are evaluated for impairment at least annually on the first day of Orion’s fiscal fourth quarter, or when indications of potential impairment exist. This annual impairment review may begin with a qualitative test to determine whether it is more likely than not that an indefinite lived intangible asset's carrying value is greater than its fair value. If the qualitative assessment reveals that asset impairment is more likely than not, a quantitative impairment test is performed comparing the fair value of the indefinite lived intangible asset to its carrying value. Alternatively, the qualitative test may be bypassed and the quantitative impairment test may be immediately performed. If the fair value of the indefinite lived intangible asset exceeds its carrying value, the indefinite lived intangible asset is not impaired and no further review is performed. If the carrying value of the indefinite lived intangible asset exceeds its fair value, an impairment loss would be recognized in an amount equal to such excess. Once an impairment loss is recognized, the adjusted carrying value becomes the new accounting basis of the indefinite lived intangible asset.

Income Taxes

Orion recognizes deferred tax assets and liabilities for the future tax consequences of temporary differences between financial reporting and income tax basis of assets and liabilities, measured using the enacted tax rates and laws expected to be in effect when the temporary differences reverse. Deferred income taxes also arise from the future tax benefits of operating loss and tax credit carryforwards. A valuation allowance is established when management determines that it is more likely than not that all or a portion of a deferred tax asset will not be realized.

57ASC 740, Income Taxes, also prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination. Orion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Orion recognizes penalties and interest related to uncertain tax liabilities in income tax expense.

~~temporary~~Stock-based differences reverse. Deferred income taxes also arise from the future tax benefits of operating loss and tax credit carryforwards. A valuation allowance is established when management determines that it is more likely than not that all or a portion of a deferred tax asset will not be realized. For the fiscal year ended March 31, 2025 and 2024, Orion recognized a valuation allowance for all of its net deferred tax assets.Compensation

ASC 740, Income Taxes, also prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination. Orion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Orion recognizes penalties and interest related to uncertain tax liabilities in income tax expense. Penalties and interest are immaterial and are included in the unrecognized tax benefits.

Stock Based Compensation

Orion’s share-based payments to employees are measured at fair value and are recognized against earnings, on a straight-line basis over the requisite service period.

Orion accounts for stock-based compensation in accordance with ASC 718, Compensation - Stock Compensation. Under the fair value recognition provisions of ASC 718, stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense ratably over the requisite service period. As more fully described in Note 16 – Restricted Shares, Orion currently awards non-vested restricted stock (and in some cases, in conjunction with associated cash award accounted for as a liability) to employees, executive officers and directors.

Acquisition Related Costs

Acquisition related costs includes legal fees, consulting and success fees, and other integration related costs.

Concentration of Credit Risk and Other Risks and Uncertainties

Orion’s cash is primarily deposited with one financial institution. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. Orion has not experienced any losses in such accounts and believes that it is not exposed to any significant financial institution viability risk on these balances.

Orion purchases components necessary for its lighting products, including lamps and LED components, from multiple suppliers. For fiscal ~~2025~~2026, ~~2024~~2025 and ~~2023~~2024, no supplier accounted for more than 10% of total cost of revenue.

In fiscal ~~2025~~2026, one customer accounted for 2426.30% of revenue. In fiscal ~~2024~~2025, one customer accounted for 2518.21% of total revenue. In fiscal ~~2023~~2024, one customer accounted for 1625.26% of total revenue. The revenue from this customer is recorded in Orion's lighting and maintenance segments.

As of March 31, ~~2025~~2026, one customer accounted for 1333.01% of accounts receivable. As of March 31, ~~2024~~2025, ~~two~~one ~~customers~~customer accounted for 1713.30% ~~and 11.7%~~ of accounts receivable.

Compliance with the Continued Listing Standards of the Nasdaq Capital Market (“NASDAQ”) and Reverse Stock Split

On September 20, 2024, the Company received written notice from NASDAQ that it was not in compliance with NASDAQ’s minimum bid price requirement for continued listing on NASDAQ, as the closing bid price of the Company’s common stock had been below $1.00 per share for 30 consecutive trading days, and the Company was granted 180-calendar days, or until March 19, 2025 to regain compliance with the minimum bid price requirement. On March 19, 2025, the Company submitted a formal request to NASDAQ for an additional 180-calendar day period to regain compliance with the minimum bid price requirement and provided written notice to 54

58As previously disclosed, on September 20, 2024, Orion received written notice from the Listing Qualifications Department (the “Staff”) of NASDAQ notifying Orion that it was not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Rule”) for continued listing on NASDAQ, as the closing bid price of the Orion’s common stock had been below $1.00 per share for 30 consecutive trading days.

~~NASDAQ~~Ultimately, ~~that~~in itorder ~~intends~~ to ~~effectuate~~regain compliance with the Minimum Bid Price Rule, Orion effected a 1-for-10 reverse stock split ~~during~~of ~~the~~its ~~additional~~common ~~compliance~~stock ~~period~~as ifof ~~necessary~~the toopening ~~regain~~of ~~compliance~~trading ~~with~~on ~~the~~August ~~minimum~~22, ~~bid price requirement~~2025.

OnAs ~~March 20, 2025, the Company received~~ a ~~letter~~result ~~from~~of ~~NASDAQ notifying it that~~ the ~~Company~~effect ~~was~~of ~~eligible~~Orion's ~~for~~reverse anstock ~~additional 180-calendar day period~~split, oron ~~until~~ September 158, 2025, toOrion ~~regain~~received ~~compliance~~a ~~with~~written ~~the~~notification ~~minimum~~from ~~bid~~the ~~price~~Staff ~~requirement.~~indicating Ifthat ~~the~~Orion ~~Company~~had ~~does~~regained ~~not regain~~ compliance bywith ~~September 15, 2025, then NASDAQ will notify~~ the ~~Company~~Minimum ofBid ~~its~~Price ~~determination to delist the Company’s common stock from trading on NASDAQ~~Rule. ~~Although~~Consequently, ~~the~~Orion ~~Company~~is ~~would~~now ~~have~~in ancompliance ~~opportunity~~with toall ~~appeal~~applicable ~~the~~listing ~~delisting~~standards ~~determination~~of, toand aremains ~~hearings~~listed ~~panel~~on, ~~under NASDAQ rules,~~ the ~~Company’s delisting from~~ NASDAQ ~~would be effective on or about September 16, 2025~~.

The Company intends to monitor the closing bid price of its common stock and likely will need to seek to effect a reverse stock split of the Company’s common stock to regain compliance with NASDAQ’s minimum bid price requirement by September 15, 2025 in order to avoid delisting. There can be no assurance that the Company will be able to regain compliance with NASDAQ’s minimum bid price requirement, even if it maintains compliance with the other NASDAQ listing requirements.

Recent Accounting Pronouncements

Changes to ~~U.S.~~ GAAP are typically established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s ~~Accounting Standards Codification (“~~ASC”). Orion considers the applicability and impact of all ASUs.

Recently Adopted Standards

In ~~November~~December 2023, the FASB issued ASU No. 2023-0709, ~~Segment~~Income ~~Reporting~~Taxes (Topic ~~280~~740): Improvements to ~~Reportable~~Income ~~Segment~~Tax Disclosures, which ~~modifies~~expands ~~the~~disclosures ~~disclosure and presentation requirements of reportable segments. The amendments~~ in ~~the~~an ~~update~~entity's ~~require~~income ~~the~~tax ~~disclosure~~rate ofreconciliation ~~significant~~table ~~segment~~and ~~expenses~~disclosures ~~that~~regarding ~~are~~cash ~~regularly~~taxes ~~provided~~paid toboth ~~the~~in ~~chief operating decision maker (~~the ~~“CODM”)~~U.S. and ~~included~~foreign ~~within each reported measure of segment profit and loss~~jurisdictions. The ~~amendments~~update ~~also~~will ~~require~~be ~~disclosure~~effective offor ~~all~~annual ~~other~~periods ~~segment~~beginning ~~items~~after byDecember ~~reportable segment and a description of its composition. Additionally~~15, the amendments require disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing segment performance and deciding how to allocate resources2025. Orion adopted this standard on ~~April~~March 131, ~~2024~~2026, and ~~adoption~~it ~~had~~did nonot ~~impact~~have ona ~~the~~material ~~financial~~effect ~~statements,~~on its ~~only~~results ~~the~~of ~~accompanying footnotes. See Note 17~~operations, ~~Segment~~financial ~~Data~~position, ~~for~~or ~~the~~cash ~~updated~~flows. ~~segment~~For ~~disclosures~~additional asinformation, asee ~~result~~Note ~~of adopting this ASU~~13.

Issued: Not Yet Adopted

In ~~November~~December ~~2024~~2025, the FASB issued ASU No. ~~2024~~2025-0311, ~~Income~~Interim ~~Statement -~~ Reporting, ~~Comprehensive~~which ~~Income~~is -intended ~~Expense~~to ~~Disaggregation~~improve ~~Disclosures~~the ~~(Subtopic~~navigability ~~220-40),~~of ~~which modifies~~ the ~~disclosure~~guidance ~~and~~in ~~presentation~~Accounting ~~requirements~~Standards ~~relating~~Codification to(ASC) ~~expenses~~270 ~~shown~~and onclarify ~~the~~when ~~income~~it ~~statement~~applies. ~~The~~Under the amendments, inan ~~the~~entity ~~update~~is ~~require~~subject ~~disclosure,~~to inASC ~~the~~270 ~~notes~~if toit provides "interim financial statements, ofand ~~specified~~notes ~~information~~in ~~about~~accordance ~~certain~~with ~~costs and expenses~~GAAP." The ~~amendments~~ASU ~~require~~also ~~that~~addresses atthe ~~each~~form ~~interim~~ and ~~annual~~content ~~reporting~~of ~~period~~such anfinancial ~~entity:~~statements, 1adds .lists ~~Disclose~~to ~~the~~ASC ~~amounts~~270 of ~~(a)~~the ~~purchases~~interim ofdisclosures ~~inventory,~~required ~~(b)~~by ~~employee~~all ~~compensation,~~other ~~(c)~~codification ~~depreciation~~topics, ~~(d)~~and ~~intangible~~establishes ~~asset~~a ~~amortization,~~principle ~~and~~under ~~(e)~~which ~~depreciation,~~an ~~depletion,~~entity ~~and~~must ~~amortization~~"disclose ~~recognized~~events assince ~~part~~the end of ~~oil~~the ~~and~~last ~~gas-producing~~annual ~~activities.~~reporting 2.period ~~Include certain amounts~~ that ~~are~~have ~~already~~a ~~required~~material toimpact beon ~~disclosed~~the ~~under~~entity." ~~current~~As ~~generally~~the ~~accepted~~FASB ~~accounting~~stated ~~principles~~ in the ~~same~~proposed ~~disclosure~~guidance asand ~~the~~reiterates ~~other~~in ~~disaggregation~~the ~~requirements.~~ASU, ~~3. Disclose a qualitative description of~~ the ~~amounts~~amendments ~~remaining in relevant expense captions that~~ are not ~~separately~~intended ~~disaggregated~~to ~~quantitatively.~~"change ~~4. Disclose~~ the ~~total~~fundamental ~~amount~~nature of ~~selling~~interim ~~expense and, in annual~~ reporting ~~periods,~~or anexpand ~~entity's~~or ~~definition~~reduce ofcurrent ~~selling~~interim ~~expenses~~disclosure requirements." The amendments inwill ~~this~~be ~~update are~~ effective for ~~annual~~interim reporting periods ~~beginning~~within ~~after~~annual ~~December 15, 2026, and interim~~ reporting periods beginning after December 15, 2027. ~~Early adoption is permitted.~~ Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.

59In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments - Credit Losses (Topic 326), which modifies the current credit loss guidance in Topic 326 to expand on how an entity develops and estimate of expected credit losses. The amendments in this update provide (1) all entities with a practical expedient and (2) entities other than public business entities with an accounting policy election when estimating expected credit loses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, as follows: "1. Practical expedient. In developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. 2. Accounting policy election. An entity other than a public business entity that elects the practical expedient is permitted to make an accounting policy election to consider collection activity after the balance sheet date when estimating expected credit losses." The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands disclosures in an entity’s income tax rate reconciliation table and disclosures regarding cash taxes paid both in the U.S. and foreign jurisdictions. The update will be effective for annual periods beginning after December 15, 2025. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.55

In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which modifies the disclosure and presentation requirements relating to expenses shown on the statements of operations. The amendments in the update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity: "1. Disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization recognized as part of oil and gas-producing activities. 2. Include certain amounts that are already required to be disclosed under current generally accepted accounting principles in the same disclosure as the other disaggregation requirements. 3. Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. 4. Disclose the total amount of selling expense and, in annual reporting periods, an entity's definition of selling expenses." The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.

NOTE 3 — REVENUE

Revenue Recognition

See Note 2 – Summary of Significant Accounting Policies for a discussion of Orion’s accounting policies related to revenue recognition.

Contract Fulfillment Costs

Disaggregation of Revenue

The primary end-users of Orion’s lighting products and services are (a) the federal government, and (b) commercial or industrial companies.

The federal government obtains Orion products and services primarily through turnkey project sales that Orion makes to a select group of contractors who focus on the federal government. Revenues associated with government end-users are primarily included in the Orion lighting and EV segments.

Commercial or industrial end-users obtain Orion products and services through turnkey project sales or by purchasing products either direct from Orion or through distributors or energy service companies ("ESCOs"). Revenues associated with commercial and industrial end-users are included within each of Orion’s segments.

See ~~Footnote~~Note 17 - Segment Data, for additional discussion concerning Orion’s reportable segments.

The following table provides detail of Orion’s total revenues for the year ended March 31, ~~2025~~2026, ~~2024~~2025, and ~~2023~~2024 (dollars in thousands):

Year Ended March 31, 2025

Year Ended March 31, 2024

Year Ended March 31, 2023

Year Ended March 31, 2026

Year Ended March 31, 2025

Year Ended March 31, 2024

Product

Services

Total

Product

Services

Total

Product

Services

Total

Revenue from contracts with customers:

Lighting product and installation

3938,~~247~~995

714,~~659~~707

4653,~~906~~702

5039,~~229~~247

107,~~783~~659

6146,~~012~~906

4650,~~500~~229

710,~~088~~783

5361,~~588~~012

Maintenance services

57,~~902~~293

98,~~288~~749

1516,~~190~~042

45,~~687~~902

129,~~460~~288

1715,~~147~~190

34,~~266~~687

1112,~~289~~460

1417,~~555~~147

Electric vehicle charging

8,~~421~~563

85,~~405~~821

1614,~~826~~384

8,~~301~~421

48,~~031~~405

1216,~~332~~826

48,~~479~~301

14,~~796~~031

612,~~275~~332

Solar energy-related revenues

171,353

—

171,353

2817

—

2817

—28

—

—28

Total revenues from contracts with customers

5356,~~587~~204

2529,~~352~~277

7885,~~939~~481

6353,~~245~~587

2725,~~274~~352

9078,~~519~~939

5463,245

2027,~~173~~274

7490,~~418~~519

Revenue accounted for under other guidance (1)

~~781~~825

—

~~781~~825

62781

—

62781

~~2,965~~62

—

~~2,965~~62

Total revenue

5457,~~368~~029

2529,~~352~~277

7986,~~720~~306

6354,~~307~~368

2725,~~274~~352

9079,~~581~~720

5763,~~210~~307

2027,~~173~~274

7790,~~383~~581

(1) Revenue accounted for under other guidance is recognized as Product revenue in the consolidated statements of operations and includes $0.74 million, $0.7 million and $~~2.8~~0 million derived from sales-type leases for light fixtures for the fiscal years ended March 31, ~~2025~~2026, ~~2024~~2025, and ~~2023~~2024, respectively; $0 million, $0.1 million, and $0.1 million derived from the sale of tax credits generated from Orion’s legacy operation for distributing solar energy for the fiscal years ended March 31, ~~2025~~2026, ~~2024~~2025, and ~~2023~~2024, respectively; and $0.14 million, $0, and $0 derived from the amortization of federal grants received in 2010 and 2011 as reimbursement for a portion of the costs to construct the legacy solar facilities for the fiscal years ended March 31, ~~2025~~2026, ~~2024~~2025, and ~~2023~~2024, respectively.

60Bill and hold revenue that had not shipped was $0 million and $0.1 million as of March 31, 2026 and 2025, respectively.

~~Bill and hold revenue that had not shipped was $0.1 million and $0.8 million as of March 31, 2025 and 2024, respectively.~~56

Cash Flow Considerations

Material only orders are short-term in nature generally having terms of significantly less than one year. We record revenue from these contracts when the customer obtains control of those goods, which is generally consistent with the payment due date. There is not a significant impact on the nature, amount, timing, and uncertainty of revenue or cash flows based on when control transfers.

Turnkey projects and repair services provided to commercial or industrial companies typically span between one week to three months. Customer payment requirements for these projects vary by contract. Some contracts provide for customer payments for products and services as they are delivered, other contracts specify that the customer will pay for the project in its entirety upon completion of the installation.

Turnkey projects where the end-user is the federal government typically span a three to six-month period. The contracts for these sales often provide for monthly progress payments equal to ninety percent (90%) of the value provided by Orion during the month.

Orion provides long-term financing to one customer who frequently engages Orion in large turnkey projects that span between three and nine months. The customer executes an agreement providing for monthly payments of the contract price, plus interest, over a five-year period. The total transaction price in these contracts is allocated between product and services in the same manner as all other turnkey projects. The portion of the transaction associated with the installation is accounted for consistently with all other installation related performance obligations. The portion of the transaction associated with the sale of the multiple individual light fixtures is accounted for as sales-type leases in accordance with the guidance for leases. Revenues associated with the sales-type leases are included in Product revenue and recorded for each fixture separately based on the customer’s monthly acknowledgment that specified fixtures have been installed and are operating as specified.

The payments associated with these transactions that are due during the twelve months subsequent to March 31, ~~2025~~2026 are included in Accounts receivable, net in Orion’s ~~Consolidated~~consolidated ~~Balance~~balance ~~Sheets~~sheets. The remaining amounts due that are associated with these transactions are included in Long-term accounts receivable in Orion’s ~~Consolidated~~consolidated

Filing Compare · ORION ENERGY SYSTEMS, INC.