Pineapple Energy Closes Debt Financing with Decathlon Capital Partners

–$7.5 million debt instrument with 48-month term–
–Retires SUNation short-term seller’s note with no equity dilution–
–Allows Pineapple to move forward with full integration of SUNation for synergy realization–

MINNETONKA, Minn., June 01, 2023 (GLOBE NEWSWIRE) -- Pineapple Energy Inc. (NASDAQ: PEGY) (the “Company” or “Pineapple”), a leading provider of solar power, battery storage systems, and smart energy control to households and small businesses, today announced the closing of a $7.5 million debt deal with Decathlon Capital Partners, the country’s largest revenue-based funding investor.

The transaction, which carries a 48-month term, is a straight debt instrument, thus avoiding any equity dilution. Debt service payments begin at a smaller initial level and increase over the course of the loan in several step-ups, tracking the Company’s revenue growth. Along with Decathlon’s collaborative approach and covenant-light terms, these features make this an ideal funding instrument for Pineapple at this stage of the company’s life.
Funds will be utilized as follows:

• $5.0 million to retire the short-term note issued in connection with the SUNation acquisition
• $1.5 million to retire other debt
• $1.0 million remaining for working capital as needed
  

Pineapple Chief Financial Officer Eric Ingvaldson commented, “After careful consideration of all available financing options, the terms negotiated with Decathlon were the most favorable for the PEGY shareholders. We took advantage of our ability to issue senior-secured debt to retire certain obligations and to refinance other obligations over a 4-year term. Most importantly, we resolved short-term liquidity concerns resulting from the SUNation acquisition and related short-term note due in August. SUNation is now fully a part of Pineapple, and we are acting with urgency to fully integrate the business and realize synergies on both the revenue and expense sides. This funding round wouldn’t have been possible without our relentless focus on execution and operational excellence, as demonstrated by our achieving positive cash flow from operations in Q1. We will continue to run the businesses aggressively and with financial discipline.”