The Second Amendment provides a waiver for the breach of the purchase order covenant for the fiscal quarter ended December 31, 2025, and stipulates that this covenant will not apply until the fiscal quarter ending March 31, 2027. Additionally, the financial covenants have been amended, requiring the company to maintain certain levels of unrestricted cash and revenue in the upcoming quarters.
Specifically, FTC Solar must have at least $15 million in unrestricted cash by June 30, 2026, and $10 million in subsequent quarters. Furthermore, the company is required to achieve consolidated quarterly revenues of at least $25 million for the quarter ending June 30, 2026, $50 million for the quarter ending September 30, 2026, and $75 million for the quarter ending December 31, 2026. The amendment also includes a requirement for the company to maintain a consolidated EBITDA of at least $10 million for the 12-month period ending December 31, 2026.
The company has agreed to make principal repayments of $2.5 million on March 23, 2026, and an additional $2.5 million on May 22, 2026, followed by a $5 million repayment on September 30, 2026. Failure to meet these repayment obligations could result in an event of default under the Credit Agreement.
This development indicates FTC Solar's ongoing challenges in meeting its financial covenants, which could impact investor confidence and stock performance in the near term. The company is classified as an emerging growth company, which may provide it with certain regulatory advantages but also highlights its need for careful financial management moving forward.
