TPI Composites (OTC: TPICQ) outlines Chapter 11 plan, asset sales and expected equity cancellation
Rhea-AI Filing Summary
TPI Composites, Inc. filed its annual report while operating under Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of Texas. The company warns that creditors and stockholders may receive little or no recovery and expects existing common equity to be canceled in the Chapter 11 process.
TPI’s Nasdaq listing was removed in September 2025, and its shares now trade on the OTC Pink Market under the symbol TPICQ. As of January 31, 2026, it had 48,765,812 common shares outstanding and an aggregate non‑affiliate market value of about $23.5 million as of June 30, 2025.
The company entered an $82.5 million debtor‑in‑possession credit facility with Oaktree, experienced an event of default that was later waived, and had $23.9 million outstanding under this DIP facility as of December 31, 2025. It also carried $476.9 million of senior secured debt under a separate credit agreement.
TPI is pursuing asset sales under section 363 of the Bankruptcy Code. In March 2026 it agreed to sell its Chennai, India plant for about $10.0 million and its Matamoros, Mexico plant for about $14.0 million to Vestas, and to sell additional wind blade businesses and assets to ECP Blade Holdings for about $20.0 million, all subject to adjustments and closing conditions. A backup transaction with GE Vernova contemplates a further $21.0 million sale of Iowa and related wind blade assets if the ECP deal terminates.
The company highlights significant risk from U.S. Customs and Border Protection reviews under the Uyghur Forced Labor Prevention Act, which are currently restricting imports of many blades made in Mexico, disrupting its supply chain and U.S. sales. TPI also notes it plans to file Form 15 to deregister its stock and suspend Exchange Act reporting after this filing, and that it faces substantial going concern uncertainty and highly volatile financial results during the restructuring.
Positive
- None.
Negative
- Chapter 11 filing and expected equity cancellation: The company is in Chapter 11, warns that stock trading is highly speculative, and explicitly expects common equity holders will not receive distributions and that the equity will be canceled.
- Delisting and deregistration: Nasdaq trading was suspended in August 2025 and the stock now trades on OTC Pink as TPICQ. The company plans to file Form 15 to deregister and suspend Exchange Act reporting, reducing transparency.
- High leverage and DIP dependence: TPI reports $476.9 million of senior secured debt and $23.9 million outstanding under an $82.5 million DIP facility, with a recent DIP event of default that required a waiver, highlighting refinancing and liquidity risk.
- Constrained operations from UFLPA review: U.S. Customs reviews under the Uyghur Forced Labor Prevention Act are blocking import of a substantial portion of blades made in Mexico, disrupting supply, delaying deliveries, and potentially causing lost U.S. sales.
- Asset sales at modest values versus debt: The Chennai and Matamoros sales to Vestas (~$10.0M and $14.0M), the ~$20.0M ECP transaction, and the ~$21.0M GE Vernova backup appear small relative to total secured obligations, limiting room for junior stakeholder recovery.
Insights
Chapter 11, delisting and asset sales point to a near‑total loss for existing equity.
TPI Composites is operating as a debtor‑in‑possession with $476.9M in senior secured debt and a separate $82.5M DIP facility, of which $23.9M was drawn as of December 31, 2025. The company explicitly states it expects existing common stock to be canceled in the Chapter 11 process.
The restructuring centers on section 363 sales: Vestas deals totaling about $24M, an ECP transaction of about $20M, and a $21M GE Vernova backup. These values appear modest relative to the secured debt load, underscoring why management does not expect distributions to shareholders.
Liquidity is constrained by the DIP covenants, earlier DIP default (since waived), and operational headwinds including UFLPA‑driven import restrictions on Mexican‑produced blades. Subsequent filings and Bankruptcy Court orders will define final recoveries for creditors and the structure, if any, of the reorganized or sold business.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended
or
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
(Exact name of Registrant as specified in its charter)
|
||
(State or other jurisdiction of incorporation or organization) |
|
(I.R.S. Employer Identification Number) |
(
(Address, including zip code, and telephone number,
including area code, of Registrant’s principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading symbol(s) |
Name of each exchange on which registered |
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 ☐
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐
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.
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).
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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 |
|
☐ |
|
|
|
|
|
|
|
|
☒ |
|
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. |
|
|||||
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 the shares of common stock held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on June 30, 2025 as reported by the NASDAQ Global Market on such date was approximately $
As of January 31, 2026, the Registrant had
* On August 12, 2025, TPI Composites, Inc. (the “Company”) received a letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”), notifying the Company, that in accordance with Nasdaq Listing Rule 5101, 5110(b) and IM-5101-1, the Staff had determined to delist the Company’s securities from Nasdaq. The Company did not request a hearing before the panel to appeal the Staff’s determination. Accordingly, trading of the Company’s common stock, par value $0.01 per share, was suspended at the opening of business on August 19, 2025, and on September 12, 2025, a Form 25 was filed with the Securities and Exchange Commission, which removed the Company’s common stock from listing and registration on Nasdaq. The common stock began trading on the OTC Pink Market on August 19, 2025 under the symbol “TPICQ.”
Table of Contents
|
|
|
|
Page |
PART I |
|
|
|
|
Item 1. |
|
Business |
|
6 |
Item 1A. |
|
Risk Factors |
|
16 |
Item 1B. |
|
Unresolved Staff Comments |
|
29 |
Item 1C. |
|
Cybersecurity |
|
29 |
Item 2. |
|
Properties |
|
31 |
Item 3. |
|
Legal Proceedings |
|
31 |
Item 4. |
|
Mine Safety Disclosures |
|
31 |
|
|
|
|
|
PART II |
|
|
|
|
Item 5. |
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
|
32 |
Item 6. |
|
[Reserved] |
|
33 |
Item 7. |
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|
34 |
Item 7A. |
|
Quantitative and Qualitative Disclosures About Market Risk |
|
56 |
Item 8. |
|
Financial Statements and Supplementary Data |
|
56 |
Item 9. |
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
|
56 |
Item 9A. |
|
Controls and Procedures |
|
56 |
Item 9B. |
|
Other Information |
|
57 |
Item 9C. |
|
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections |
|
57 |
|
|
|
|
|
PART III |
|
|
|
|
Item 10. |
|
Directors, Executive Officers and Corporate Governance |
|
58 |
Item 11. |
|
Executive Compensation |
|
67 |
Item 12. |
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
|
84 |
Item 13. |
|
Certain Relationships and Related Transactions, and Director Independence |
|
86 |
Item 14. |
|
Principal Accountant Fees and Services |
|
88 |
|
|
|
|
|
PART IV |
|
|
|
|
Item 15. |
|
Exhibits and Financial Statement Schedules |
|
89 |
Item 16. |
|
Form 10-K Summary |
|
89 |
|
|
|
|
|
i
NOTE REGARDING CHAPTER 11 BANKRUPTCY PROCEEDINGS
As previously disclosed, on August 11, 2025 (the “Petition Date”), TPI Composites, Inc. (the “Company”) and certain of its direct and indirect subsidiaries (such subsidiaries, together with the Company, collectively, the “Company Parties” or the “Debtors”) each filed voluntary petitions for relief under chapter 11 of title 11 of the United States Bankruptcy Code (the “Bankruptcy Code” and such cases, the “Chapter 11 Cases”) in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). The Debtors also filed a motion seeking approval of procedures for the sale of all or any of the Debtors’ assets pursuant to section 363 of the Bankruptcy Code. Documents filed on the docket of, and other information related to, the Chapter 11 Cases are available at https://restructuring.ra.kroll.com/TPIComposites. Documents and other information available on such website are not part of this document and shall not be deemed incorporated by reference in this document. The Company continues to operate its business as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. The Company cannot assure you that its creditors or stockholders will receive any recovery in connection with the Chapter 11 Cases. The Company also cautions that trading in the Company’s common stock during the pendency of the Chapter 11 Cases is highly speculative, poses substantial risks, and is subject to potential restrictions imposed by the Bankruptcy Court. Trading prices for the Company’s common stock may bear little or no relationship to the actual recovery, if any, by holders of the Company’s common stock in the Chapter 11 Cases. Accordingly, the Company urges caution with respect to existing and future investments in its common stock. Further, the Company expects that holders of the Company’s common stock will not receive distributions in the Chapter 11 Cases, and that the equity will be canceled in connection with the Chapter 11 Cases. See Part I, Item 1A – Risk Factors for a discussion of risks related to the Chapter 11 proceedings.
On August 19, 2025, the Company’s common stock, par value $0.01 per share, was suspended from trading on The Nasdaq Stock Market LLC (“Nasdaq”). On September 12, 2025, a Form 25 was filed with the Securities and Exchange Commission (the “SEC”), which removed the Company’s common stock from listing and registration on Nasdaq. The common stock began trading on the OTC Pink Market on August 19, 2025 under the symbol “TPICQ.” [As of January 2, 2026, the first business day of fiscal year 2026, the Company had fewer than 300 shareholders of record and as a result, was not subject to any periodic reporting obligations under Section 15(d) of the Exchange Act. The Company intends to file a Form 15, Notice of Termination of Registration and Suspension of Duty to File, to voluntarily deregister our common stock and suspend reporting obligations under the Exchange Act, as soon as possible after filing this report.
On March 1, 2026, the Company received a letter from the lenders (the “DIP Lenders”) under the DIP Credit Agreement (as defined below) regarding an Event of Default occurring under the Super-Priority Senior Secured Priming Debtor-in-Possession Credit Agreement and Guaranty, dated as of August 14, 2025, among the Company, as the Borrower, the subsidiary guarantors party thereto, the lenders party thereto and Oaktree Fund Administration, LLC (“Oaktree”) as the Administrative Agent (as amended, modified or supplemented from time to time, the “DIP Credit Agreement”). All capitalized terms not defined herein but defined in the DIP Credit Agreement shall have the meanings given to such terms in the DIP Credit Agreement. The letter notified and confirmed to the Borrower that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction (as each is defined below) as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
On March 4, 2026, following a competitive marketing process to sell all or part of the Debtors’ asset pursuant to section 363 of the Bankruptcy Code, the Company and certain of its direct and indirect subsidiaries (collectively, the “Sellers”), entered into various agreements with Vestas Wind Systems A/S and certain of its subsidiaries (collectively, “Vestas”), pursuant to which the Company will sell and transfer its manufacturing business in Chennai, India for a purchase price of approximately $10.0 million, and its manufacturing business in Matamoros, Mexico for a purchase price of approximately $14.0 million (collectively, the “Vestas Sale Transactions”). The Sellers currently manufacture wind blades for Vestas at these facilities. In each instance, the Vestas Sale Transactions are subject to certain purchase price adjustments and the assumption of certain liabilities and are
1
subject to a number of closing conditions and may be terminated by either party under certain circumstances, including among others, if the Vestas Sale Transactions are not closed by June 30, 2026. Refer to Note 24 – Subsequent Events for further information regarding the Vestas Sale Transactions.
Further, on March 6, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “ECP Seller Parties”) entered into a Stock and Asset Purchase Agreement (the “ECP Purchase Agreement”) with ECP Blade Holdings LLC (“ECP Buyer”). Pursuant to the ECP Purchase Agreement, the ECP Seller Parties will sell and transfer to ECP Buyer (i) all of the equity interests of certain foreign indirect subsidiaries of the Company, and (ii) substantially all of the assets primarily related to the Company’s wind blade manufacturing business at facilities located in the U.S. and Mexico, other than the assets to be sold pursuant to the Vestas Sale Transaction (the “ECP Business”) in exchange for approximately $20.0 million in cash, subject to certain purchase price adjustments and the assumption of certain liabilities, each as set forth in the ECP Purchase Agreement (the “ECP Sale Transaction”). The ECP Sale Transaction is subject to a number of closing conditions and may be terminated by either party under certain circumstances, including among others, if the ECP Sale Transaction has not been consummated by June 30, 2026, subject to extension in certain circumstances. Refer to Note 24 – Subsequent Events for further information regarding the ECP Sale Transaction.
Additionally, on March 16, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “Back-Up Bidder Seller Parties”) entered into a Term Sheet (the “GE Vernova Term Sheet”) with GE Vernova International LLC (“GE Vernova”), setting forth the terms of definitive documentation to be entered into among the Back-Up Bidder Seller Parties and GE Vernova (the “Back-Up Bidder Documentation”). Pursuant to the GE Vernova Term Sheet, in the event that the ECP Purchase Agreement is terminated and subject to other conditions set forth in the GE Vernova Term Sheet, the Back-Up Bidder Seller Parties will sell and transfer to GE Vernova, free and clear of all liens, interests, and encumbrances (except as will be set forth in the Back-Up Bidder Documentation) pursuant to section 363 of the Bankruptcy Code certain assets of the Back-Up Bidder Seller Parties, including assets related to wind blade manufacturing at our Iowa facility and all related storage facilities used in connection with such manufacturing and other intellectual property related to wind blade manufacturing of the blade types (including, but not limited to, design, technical support, and other items) (the “GEV Business”), in exchange for approximately $21.0 million in cash (the “GE Vernova Transaction”). Pursuant to the GE Vernova Term Sheet, the consummation of the GE Vernova Transaction shall be subject to a number of closing conditions, including, among other things, (i) entry by the Bankruptcy Court of an order approving the GE Vernova Transaction, (ii) termination of the ECP Purchase Agreement, and (iii) conditions with respect to the accuracy of representations and warranties and compliance with covenants to be set forth in the Back-Up Bidder Documentation. If the ECP Purchase Agreement is terminated and the GE Vernova Transaction is not consummated prior to August 31, 2026, GE Vernova is obligated to purchase the certain obligations of the DIP Lenders under the DIP Credit Agreement from the DIP Lenders. Refer to Note 24 – Subsequent Events for further information regarding the GE Vernova Transaction.
2
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). All statements other than statements of historical facts contained in this Annual Report on Form 10-K, including statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. In many cases, you can identify forward-looking statements by terms such as “may,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar words. Forward-looking statements contained in this Annual Report on Form 10-K include, but are not limited to, statements about:
3
4
These forward-looking statements are only predictions. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to materially differ from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. We have described under the heading “Risk Factors” included in Part I, Item 1A of this Annual Report on Form 10-K the principal risks and uncertainties that we believe could cause actual results to differ from these forward-looking statements. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as guarantees of future events.
The forward-looking statements in this Annual Report on Form 10-K represent our views as of the date of this Annual Report on Form 10-K. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we undertake no obligation to update any forward-looking statement to reflect events or developments after the date on which the statement is made or to reflect the occurrence of unanticipated events except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date after the date of this Annual Report on Form 10-K. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make.
5
PART I
Item 1. Business
Description of Business
TPI Composites, Inc. is the holding company that conducts substantially all of its business operations through its direct and indirect subsidiaries (collectively, the Company, TPI or we). The Company was founded in 1968 and has been producing composite wind blades since 2001. The Company is incorporated in the State of Delaware.
Bankruptcy Proceedings
On August 11, 2025 (the “Petition Date”), TPI Composites, Inc. and certain of its direct and indirect subsidiaries (such subsidiaries, together with the Company, collectively, the “Company Parties” or the “Debtors”) each filed voluntary petitions for relief under chapter 11 of title 11 of the United States Bankruptcy Code (the “Bankruptcy Code” and such cases, the “Chapter 11 Cases”) in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). The Debtors also filed a motion seeking approval of procedures for the sale of all or any of the Debtors’ assets pursuant to section 363 of the Bankruptcy Code. Documents filed on the docket of, and other information related to, the Chapter 11 Cases are available at https://restructuring.ra.kroll.com/TPIComposites. Documents and other information available on such website are not part of this document and shall not be deemed incorporated by reference in this document. The Company continues to operate its business as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court.
Discontinued Operations
On September 10, 2025, the Company consummated the sale and transfer of 100% of its ownership interests of the Company’s two Turkish subsidiaries (the “Türkiye business”), which was approved by the Bankruptcy Court. The transaction involved the sale and transfer of the assets and operations of two wind blade manufacturing facilities and a field service inspection and repair business in Izmir, Türkiye on an “as-is” basis, including the assumption of the entire liabilities and debt position of the Turkish subsidiaries by the purchaser. The Türkiye business comprised the majority of the Company’s EMEA segment. The Company determined that the sale of the Türkiye business represented a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the historical results of our Türkiye business have been presented as discontinued operations in our consolidated Statements of Operations and consolidated Balance Sheets.
On June 30, 2024, we completed the divestiture of our wholly-owned subsidiary, TPI, Inc. (the Automotive subsidiary). The Automotive subsidiary was engaged in the development, commercialization and implementation of the Company’s automotive industry related products. The Automotive subsidiary was previously classified as held for sale in the Company’s consolidated balance sheets as of December 31, 2023. The divestiture constituted a strategic shift as the Company will focus entirely on executing its core business in the wind industry going forward, and accordingly, the historical results of our Automotive subsidiary have been presented as discontinued operations in our consolidated statements of operations and consolidated balance sheets.
Unless specifically noted or otherwise indicated, all information set forth in this Annual Report on Form 10-K relates to the Company as it existed as of December 31, 2025 and the following discussion reflects continuing operations only.
Overview
We are an independent manufacturer of composite wind blades for the wind energy market with a manufacturing footprint currently in the U.S., Mexico, and India. We enable certain of the industry’s leading wind turbine original equipment manufacturers (OEM) to outsource the manufacturing of a portion of their wind blades through our footprint of advanced manufacturing facilities strategically located to serve large wind markets in a cost-effective manner. Given the importance of wind energy capture, turbine reliability and cost to power producers, the size, quality and performance of wind blades is highly strategic to our OEM customers. We have entered into supply agreements pursuant to which we dedicate capacity at our facilities to our customers and manufacture wind
6
blade sets (each set consisting of three wind blades) for our customers. This collaborative dedicated supplier model provides us with contracted volumes that generate revenue visibility, drive capital efficiency and allow us to produce wind blades at a competitive cost, while ensuring critical dedicated capacity for our customers.
We also provide field service inspection and repair services to our OEM customers and wind farm owners and operators. Our field service inspection and repairs services include diagnostic, repair and maintenance service offerings for wind blades that have been installed on wind turbines located at wind farms. Our field service inspection and repair services can be performed up-tower, where a blade technician performs these services in the air or from the wind turbine tower on a wind turbine blade, or down tower, where a blade is first removed from a wind turbine and these services are performed on the ground at the wind farm site or in a repair facility.
Our wind blade manufacturing business accounted for approximately 95%, 97%, and 96% of our total net sales for each of the years ended December 31, 2025, 2024 and 2023, respectively.
Financial Information about Segments and Geographic Areas
We divide our business operations into three geographic operating segments - (1) the U.S., (2) Mexico, and (3) India as follows:
For additional information regarding our discontinued operations, and operating segments and geographic areas, see Note 4 – Discontinued Operations, and Note 23 – Segment Reporting, respectively, of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.
Business Strategy
The key elements of our business strategy are as follows:
7
Wind Blade Manufacturing Operations and Process
We have developed significant expertise in advanced composite technology and we use high performance composite materials, precision molding and assembly systems including modular tooling, and advanced process technology, as well as sophisticated measurement, inspection, testing and quality assurance tools, allowing us to produce over 103,000 wind blades since 2001 from our continuing and discontinued operations with a strong, long-term field performance record in a market where reliability is critical to our customers’ success. We manufacture or have manufactured wind blades ranging from 30 meters to over 80 meters in length across our manufacturing facilities and have the capability to manufacture wind blades of greater lengths as required by existing or new customers. In combination with our advanced technologies, we seek to create manufacturing processes that are replicable and scalable in our manufacturing facilities located worldwide, regardless of cultural or language barriers. Using continuous improvement principles, we can customize each manufacturing step, from raw materials to finished products. This also allows us to systematically design for the entire manufacturing process so that we can achieve better quality control and increase production efficiency. We believe that our focus on simplifying and, where feasible, automating production processes is critical to manufacturing high-precision, lightweight and durable products at a competitive cost for our customers. We produce high unit volumes of near-aerospace-grade products at industrial costs.
Raw Materials
The key raw materials for the wind blades we manufacture include highly advanced fiberglass fabrics, select carbon reinforcements, foam, balsa wood, resin, adhesives for assembly of molded components, gel coat or paint for preparation of cosmetic surfaces and attachment hardware including steel components. Most of these materials are available in multiple geographic regions and in reasonably close proximity to our manufacturing facilities. Our agreements for the supply of raw materials are designed to secure volumes that we believe will be required to fulfill our customers’ wind blade commitments for fixed prices with limited contractual price adjustment provisions. A portion of our raw materials are subject to price volatility, such as the resins and carbon reinforcements used in our manufacturing processes.
Although the majority of materials incorporated into our products are available from a number of sources, certain materials are available only from a relatively limited number of suppliers. We seek multiple suppliers for our raw materials and continually evaluate potential new supplier relationships. However, one of our customers sources
8
all of the critical raw materials that we use to produce such customers' wind blades. Since we do not source procurement of these raw materials for this customer, we have fewer controls and remedies to mitigate raw material and supply chain risks and disruptions relating to such raw materials for such customer.
Wind Blade Production Process
Production of wind blades requires adherence to the unique specifications of each of our customers, who design their wind turbines and wind blades to optimize performance, reliability and total delivered cost. With our culture of innovation and a collaborative “design for manufacturability” approach, we have the capability and expertise to manufacture wind blades of different designs, utilizing fiberglass, carbon fiber, or other advanced composite materials to meet unique customer specifications.
We have developed a highly dependable method for making high-quality wind blades. In conjunction with our continuous improvement principles, we design our proprietary manufacturing processes to be replicable, scalable and transferable to each of our advanced manufacturing facilities worldwide. As a result, we can repeatedly move a product from its design phase to serial production while maintaining quality, even in developing regions of the world. Similarly, we have developed the manual portions of our manufacturing processes based on proven technologies and production methods that can be learned and implemented rapidly by line personnel.
We have also developed BladeAssureTM, a process that integrates advanced technologies to ensure world-class wind blade quality and operational efficiency. These technologies include AI-aided vision solutions, selective automation and robotics, advanced sensors, and inspection technologies. These advancements are designed to document, verify, automate, and prevent manufacturing inconsistencies and abnormalities. We implemented BladeAssureTM at the majority of our manufacturing facilities in 2025.
We focus on safety, consistency, quality control, lean principles and technological innovation across our facilities, using hands-on training methods and employing repeatable manufacturing processes, to drive down costs through operational improvements and efficiencies and eliminating waste.
We use an advanced form of vacuum-assisted resin transfer tooling process to pull liquid resin into a dry lay-up, resulting in light, strong, and reliable composite structures. In our manufacturing process, fiber reinforcements and core materials are laid up in a mold while dry, followed by a vacuum bag that is placed over the layup and sealed to the mold. The wind blade component is then placed under vacuum. Resin is introduced into the wind blade component via resin inlet ports and then distributed through the reinforcement and core materials via a flow medium and a series of channels, saturating the wind blade component. The vacuum removes air and gases during processing, thereby eliminating voids. Pressure differentials drive resin uniformly throughout the wind blade component, providing a consistent laminate. By using a variety of reinforcement and core materials, the structural characteristics of the wind blade can be highly engineered to suit the custom specifications of our customers. Although only occasionally required by our customers, we are also capable of employing additional composite fabrication processes, such as pre-impregnated laminates, in addition to our vacuum infusion process.
Wind Blade Supply Agreements
During the year ended December 31, 2025, we manufactured wind blades for our two primary customers, Vestas Wind Systems A/S (“Vestas”) and GE Vernova, Inc. (“GE Vernova”), which are some of the world’s largest wind turbine manufacturers.
Moving forward, the Company expects to focus its core wind blade business on supporting its operations with a single customer, GE Vernova.
In our collaborative dedicated supplier model, our customers are incentivized to maximize the volume of wind blades purchased due to lower pricing at higher purchase volumes. Historically, our supply agreements generally contain liquidated damages provisions in the event of late delivery. Typically, our supply agreements with our customers provide us with downside protection through minimum annual volume commitments, as well as encourage our customers to maximize the volume of wind blades they purchase from us, since purchasing less than a
9
specified amount typically triggers higher pricing. Some of our supply agreements also provide for annual sales price reductions reflecting assumptions regarding improvements in our manufacturing efficiency and increases in productivity. We work to continue to drive down or minimize the impact of increases in the cost of materials and production through innovation and global sourcing, a portion of the benefit of which we share with our customers contractually, further strengthening our deep customer relationships. Similarly, we typically share any raw material price increases with our customers. However, one of our customers sources all of the critical raw materials that we use to produce such customers' wind blades and this customer assumes 100% of any such raw material price increases or decreases. Wind blade pricing is based on annual commitments of volume as established in the customer’s contract, with orders less than committed volume resulting in additional costs per wind blade to the customer. Orders in excess of annual commitments may result in discounts to customers from the contracted price for the committed volume. Customers may utilize early payment discounts, which are reported as a reduction of revenue at the time the discount is taken.
Research and Development
We conduct research and development in close collaboration with our customers and suppliers in areas of design for manufacturing and deployment of innovative manufacturing processes, including automation, advanced materials, and emerging product quality inspection tools. We have partnered with the U.S. Department of Energy, national laboratories, universities, suppliers, and our customers to innovate through cost-sharing and funded development of advanced manufacturing, sustainability (including material recycling) and other innovative programs. During the year ended December 31, 2025, we initiated projects on a variety of funded efforts with universities, government laboratories and private industry partners that include inspection technologies, additive manufacturing of modular wind blades, as well as manufacturing automation applying recycled materials to ensure movement toward a more sustainable, carbon neutral future. We continue to collaborate in national consortia and study a broad range of wind energy related technologies with our customers and wind energy owner operators. One such set of activities is an internal and external collaborative development program to create a comprehensive multi-layered artificial intelligence (AI) powered vision system that supports production metrics such as cycle-time and labor headcount and will also drive quality by reducing infusion defects and ensuring uniform resin process across the entire surface of the wind turbine blade.
We continue to expand our IP portfolio through funding internal research and development. Our manufacturing technology team is leveraging our in-house knowledge and expertise in modeling, data analysis, machine learning, artificial intelligence, and optical vision systems to implement an engineering configuration that allows for an effective roll-out of a closed-loop blade manufacturing system which we expect will positively impact quality, labor productivity and cycle-time. We are expanding and diversifying our Model-Based Manufacturing tools and techniques to cover broad technical areas including design, manufacturability, finishing processes and factory level repairs.
We employ a highly experienced workforce of engineers in various facets of our business, from research and development projects, to the ongoing, real-time development and implementation of incremental manufacturing and material improvements. We have an advanced engineering center based in Berlin, Germany which focuses on blade design, tooling, materials and process technology development. In addition, we have an advanced engineering center based in Kolding, Denmark which provides technical and engineering resources to our manufacturing facilities and our customers. Our research and development effort places a priority on improving quality through process and procedure improvement, in addition to reducing cost through specification changes and sourcing of more cost-effective suppliers. Other areas of emphasis include composite design, prototyping, testing, optimization and volume production capabilities. We also encourage our associates to invent and develop new technologies to maintain our competitiveness in the marketplace. In addition to our internal research and development activities, from time to time, we also conduct research and development activities pursuant to funded development arrangements with our customers and other third parties and we intend to continue to seek opportunities for product development programs that could create recurring revenue and increase our overall profitability over the long term.
Competition
The wind blade market is highly concentrated, competitive and subject to evolving customer needs and expectations. Our competitors include LM Wind Power (a subsidiary of GE Vernova) and other independent wind
10
blade manufacturers such as Sinoma Science & Technology Co. Ltd., Shanghai Aeolon Wind Energy Technology Development (Group) Co., Ltd., Aeris Industria E Comercio De Equipamentos Para Geracao De Energia S.A. and ZhongFu Lianzhong Composites Group Co., Ltd., as well as regional wind blade suppliers in geographic areas where our current or prospective manufacturing facilities are or will be located, such as Indutch Composites Technology Pvt. Ltd. in India.
We also compete with vertically integrated wind turbine OEMs that manufacture their own wind blades.
The principal competitive factors in the wind blade market include reliability, total delivered cost, manufacturing capability, product quality, engineering capability and on-time delivery of wind blades. We believe we compete favorably with our competitors with respect to each of these factors. However, while we have successfully competed with Chinese wind blade manufacturers for years, their recent aggressive push to expand their presence in Europe and other regions outside of North America, supported by the Chinese government, has added to the challenging competitive environment outside of the U.S. Our ability to compete will depend to a great extent upon our ongoing performance in the areas of manufacturing capability, total delivered costs, on-time delivery and product quality.
Competitive advantages in the wind blade service market include total delivered cost, speed of response, local footprint, repair quality, competitive labor pricing and capacity to work across regions as demand adapts to business seasonality. Our ability to improve our product and service offerings, including strengthening our response time, adding and managing labor resources, sourcing materials globally at competitive rates while further expanding into new countries, and offering additional value-added engineering support and technical solutions.
Intellectual Property
We have a variety of IP rights, including trademarks, copyrights and patents issued, filed and applied-for in a number of jurisdictions, including the U.S., Germany, the European Union, Türkiye, India and China, but we believe that our continued success and competitive position depend, in large part, on our proprietary materials, tooling, process and inspection technologies and our ability to innovate and not on our IP alone. Accordingly, we take measures to protect the confidentiality and control the disclosure of our proprietary technology. We rely primarily on a combination of patents, know-how and trade secrets to establish and protect our proprietary rights and preserve our competitive position. We also seek to protect our proprietary technology, in part, by confidentiality agreements with our customers, associates, consultants and other contractors. Trade secrets, however, are difficult to protect. These agreements may be breached, and we may not have adequate remedies for any breach. In addition, our trade secrets may otherwise become known or be independently discovered by competitors. To the extent that our customers, associates, consultants or contractors use IP owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.
Backlog
As of December 31, 2025 and 2024, our backlog for wind blades and related wind products totaled $114.8 million and $237.6 million, respectively. Our backlog includes purchase orders issued in connection with our supply agreements. We generally record a purchase order into backlog when the following requirements have been met: a signed supply agreement or other contractual agreement has been executed with our customer, a purchase order has been issued by our customer and we expect to ship wind blades to or produce the related wind products for such customer in satisfaction of any purchase order within 12 months. Backlog as of any particular date should not be relied upon as indicative of our revenue for any future period.
Regulation
Wind Energy
Our operations are subject to various foreign, federal, state and local regulations related to environmental protection, health and safety, labor relationships, general business practices and other matters. These regulations are administered by various foreign, federal, state and local environmental agencies and authorities, including the Environmental Protection Agency (EPA), the Occupational Safety and Health Administration of the U.S.
11
Department of Labor and comparable agencies in Mexico, India and individual U.S. states. In addition, our manufacturing operations in Mexico and India are subject to those countries’ wage and price controls, currency exchange control regulations, investment and tax laws, laws restricting our ability to repatriate profits, trade restrictions and laws that may restrict foreign investment in certain industries. Some of these laws have only been recently adopted or are subject to further rulemaking or interpretation, and their impact on our operations, including the cost of complying with these laws, is uncertain. We believe that our operations currently comply, in all material respects, with applicable laws and regulations. Further, as a U.S. corporation, we are subject to The Foreign Corrupt Practices Act of 1977 (FCPA), which generally prohibits U.S. companies and their intermediaries from making improper payments to foreign officials for the purpose of obtaining or keeping business. Although FCPA enforcement was recently paused by the U.S. federal government, we plan to continue to comply with the provisions of the FCPA. As a U.S. corporation with global operations, we are also subject to foreign antibribery laws and regulations in the countries where we conduct business, including the U.K. Bribery Act and the India Prevention of Corruption Act.
In August 2022, the U.S. Congress passed the Inflation Reduction Act of 2022 (IRA) which effectively extended the Production Tax Credit for Renewable Energy (PTC), which provides owners of wind turbines with a credit against its U.S. federal income tax obligations based on the amount of electricity generated by the wind turbine. In addition, a new advanced manufacturing production tax credit (AMPC) was created that can be claimed for the domestic production and sale of clean energy components, such as wind blades. We plan to utilize the AMPC at our Newton, Iowa manufacturing facility, which restarted production in the second half of 2025. However, the passing of the One Big Beautiful Bill Act (OBBBA) in July 2025 resulted in these wind energy tax credits being phased out earlier than expected, which could have a material impact on our Iowa facility. As of December 31, 2025, we generated and recognized approximately $7.9 million of tax credit receivables related to the AMPC based on the production of eligible wind blades at our Iowa facility during the year. We continue to monitor U.S. government policy and actions for any changes that could have adverse impacts on our business.
At the state level, as of December 31, 2024, 30 states, the District of Columbia and Puerto Rico have implemented renewable portfolio standard (RPS) programs that generally require that, by a specified date, a certain percentage of a utility’s electricity supplied to consumers within such state is to be from renewable sources (ranging from 10% to 100% and from between the present and 2050).
Customs Review
The CBP is currently reviewing certain of the wind blade models that are manufactured at our facilities in Mexico pursuant to the Uyghur Forced Labor Prevention Act (“UFLPA”). As a result of these reviews, CBP has restricted the importation of these wind blades into the U.S. while the matter remains under investigation. Although we are confident that our wind blade supply chain does not source materials from the Xinjiang Uyghur Autonomous Region of China, the UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by certain identified entities, are made with forced labor and are therefore prohibited from entry into the U.S. unless the importer can demonstrate otherwise to the satisfaction of CBP.
Because of the current CBP actions, a substantial portion of the wind blades manufactured at our Mexico facilities are unable to be imported into the U.S. market. The inability to import these wind blades has significantly disrupted, and may continue to disrupt, our supply chain, reduce available inventory for U.S. customers, delay deliveries, and result in lost sales. In addition, these CBP reviews have required and may continue to require significant management attention, internal resources, and legal and compliance costs as we work to respond to CBP’s inquiries and further demonstrate compliance with applicable laws.
The outcome and duration of the CBP reviews are uncertain. If we are unable to satisfactorily resolve the matter, CBP may continue to detain, exclude, or seize affected wind blades, which could further restrict our ability to serve customers in the U.S. and may require us to modify our sourcing, manufacturing, or supply chain practices. Any prolonged disruption in our ability to import wind blades into the U.S., or any adverse findings by CBP, will have a further, material adverse effect on our business, financial condition, and results of operations.
12
Human Capital
As of December 31, 2025, we employed more than 9,600 full-time associates, approximately 800 of whom were in the U.S., 7,800 in Mexico, 900 in India and 100 in other countries. Certain of our associates in our manufacturing facility in Matamoros, Mexico are represented by labor unions. We believe that our relations with our associates are generally good.
Our human capital strategy focuses on creating an exceptional associate experience and ensuring that we foster a learning culture where our associates want to grow with us. Our primary focus areas of our human capital strategy are as follows:
Culture
We believe our unique culture is a key strategic advantage for us. Our associates are highly engaged, have a strong sense of inclusion and belonging, and are committed to the Company, their teams, and the jobs they perform based on our most recent associate engagement surveys which continue to show strong commitment from our associates. Our associate engagement is due in part to a strong sense of purpose given our role in the broader renewable energy supply chain. We believe associate engagement and feelings of inclusion and belonging translates into a strong quality focus and orientation. When we select new persons to join our team, we ensure that the individuals have high levels of adaptability in addition to the skills needed for the role. Our associates embrace our core values of safety, operational excellence, commitment, integrity and leadership. Our team members bring our values to life by applying their diverse backgrounds and skillsets to the jobs they are performing, demonstrating high discretionary effort, and embracing our values in their day-to-day lives.
Safety
Safety is our most important and first core value. We believe that all accidents are preventable and that every associate should return at the end of their shift to their families in the same healthy condition in which they showed up for work. To help drive these beliefs it is our goal to continuously improve our zero-harm culture and implement a global behavior-based safety (BBS) program resulting in zero unsafe behaviors. All of our manufacturing facilities have safety management systems in place that cover their associates and activities. We ensure the safety of our associates to support our zero-harm culture in a variety of ways, starting with safety education. Safety education is the foundation for our other safety measures. Associates receive regular training on environmental, health and safety (EHS) related topics. This training includes but is not limited to:
Inclusion
We aspire to create an environment that recognizes and celebrates the benefits that come with a diverse workforce and strive to create a culture of inclusion where everyone has a true sense of belonging and feels they can be themselves in the workplace.
Talent
We market open jobs across multiple platforms such as our website, LinkedIn, internal postings and local job boards to ensure that our candidate pool is as diverse as possible. We promote having diversity on the interviewing and selection panel to ensure different points of view are considered as part of the final selection process. We enjoy high levels of retention across all of our geographies. We facilitate an annual talent review process in all regions and
13
functional teams to promote the internal development and promotion of internal talent. We have enjoyed high participation in associate surveys, high engagement levels against industry normative data, and facilitated an inclusion survey in 2025, 2024 and 2023.
Environmental, Health and Safety
We are subject to various environmental, health and safety laws, regulations and permit requirements in the jurisdictions in which we operate governing, among other things, health, safety, pollution and protection of the environment and natural resources, the handling and use of hazardous substances, the generation, storage, treatment and disposal of wastes, and the cleanup of any contaminated sites. We are not aware of any pending environmental compliance or remediation matters that are reasonably likely to have a material adverse effect on our business, financial position or results of operations. However, failure by us to comply with applicable environmental and other requirements could result in fines, penalties, enforcement actions, third party claims, remediation actions, and could negatively impact our reputation. We have adopted environmental, health and safety policies outlining our commitment to environmental responsibility and accountability and our desire to eliminate unsafe behaviors in the workplace. These policies apply to the Company as a whole, and our vendors and suppliers and are available on our website. We have a company-wide focus on safety and have implemented a number of measures to promote workplace safety. Customers are increasingly focused on safety records in their sourcing decisions due to increased regulations to report all incidents that occur at their sites and the costs associated with such incidents.
Available Information
Our website address is www.tpicomposites.com. All of our filings with the Securities and Exchange Commission (SEC), including this Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, statements of changes in beneficial ownership and amendments to those reports, along with any exhibits to such reports, are available free of charge on our website as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The information contained on our website is neither a part of, nor incorporated by reference into, this Annual Report on Form 10-K. The SEC also maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers, like us, that file electronically with the SEC. The address of that website is www.sec.gov.
Our investor relations website address is https://ir.tpicomposites.com/websites/tpicomposites/English/0/investor-relations.html and includes key information about our corporate governance initiatives, including our Nominating and Corporate Governance Committee charter, charters of the Audit and Compensation committees and our Code of Business Conduct & Ethics.
14
Information about our Executive Officers
The following table sets forth certain information regarding our Executive Officers as of March 25, 2026:
Name, Age |
|
Position |
|
Year Appointed as Executive |
Business Experience since January 1, 2018 |
William Siwek, 63 |
|
President, Chief Executive Officer and Director |
|
2013 |
TPI Composites, Inc.: Chief Executive Officer since May 2020, President from May 2019 to May 2020, Chief Financial Officer from August 2013 to May 2019. |
Charles Stroo, 50 |
|
Chief Operating Officer, Wind |
|
2023 |
TPI Composites, Inc.: Chief Operating Officer since November 2023. |
Ryan Miller, 51 |
|
Chief Financial Officer |
|
2022 |
TPI Composites, Inc.: Chief Financial Officer since May 2022. |
Steven Fishbach, 56 |
|
General Counsel and Secretary |
|
2015 |
TPI Composites, Inc.: General Counsel since January 2015. |
15
Item 1A. Risk Factors
You should carefully consider the following risk factors. If any of the events contemplated by the following discussion of risks should occur, our business, results of operations, financial condition, growth prospects and cash flows could suffer significantly. Additional risks that we currently do not know about or that we currently believe to be immaterial may also impair our business. Certain statements below are forward-looking statements. See “Special Note Regarding Forward-Looking Statements” in this Annual Report on Form 10-K.
Risks Related to Our Business as a Whole
We are subject to risks and uncertainties associated with our Chapter 11 Cases.
The Chapter 11 Cases have had a material adverse effect on our business, financial condition, results of operations and cash flows. The significant risks associated with the Chapter 11 Cases that could result in material adverse effects on our business, financial condition, results of operations, and cash flows include or relate to the following:
16
The Chapter 11 Cases raise substantial doubt regarding our ability to continue as a going concern.
The Chapter 11 Cases are being jointly administered under the caption In re TPI Composites, Inc., et al. in the Bankruptcy Court. Under the Bankruptcy Code, certain claims in existence prior to our filing of the petition for relief under the Bankruptcy Code are stayed while we continue business operations as a debtor-in-possession. Our operations and our ability to develop and execute our business plan are subject to significant risks and uncertainties associated with Chapter 11 Cases. These conditions raise substantial doubt about our ability to continue as a going concern. The substantial doubt about our ability to continue as a going concern may adversely impact the price of our common stock, our reputation and relationships with investors, critical vendors, employees and other third parties with whom we do business, our ability to raise additional capital or refinance existing debt, our ability to comply with certain covenants under our debt agreements or meet other contractual obligations and our ability to achieve our business objectives, which could materially and adversely impact our business, financial condition and results of operations.
As a result of the Chapter 11 Cases, our historical financial information may not be indicative of our future performance, which may be volatile.
During the Chapter 11 Cases, we expect our financial results to continue to be volatile as restructuring activities and expenses, contract terminations and rejections, and claims assessments significantly impact our consolidated financial statements. As a result, our historical financial performance is likely not indicative of our financial performance after the date of the filing of the Chapter 11 Cases. We also may be required to adopt fresh start accounting, in which case our assets and liabilities will be recorded at fair value as of the fresh start reporting date, which may differ materially from the recorded values of assets and liabilities on our consolidated balance sheets. Our financial results after the application of fresh start accounting may be different from historical trends.
The pursuit of the Chapter 11 Cases has consumed, and will continue to consume, a substantial portion of the time and attention of our management, which may have an adverse effect on our business, financial condition, results of operations and cash flows, and we may experience increased levels of employee attrition.
While the Chapter 11 Cases continue, our management will be required to spend a significant amount of time and effort focusing on the Chapter 11 Cases instead of focusing exclusively on our business operations. This diversion of attention may materially adversely affect the conduct of our business, and, as a result, our financial condition and results of operations, particularly if the Chapter 11 Cases are protracted.
Furthermore, during the pendency of the Chapter 11 Cases, we may experience increased levels of employee attrition, and our employees may face considerable distraction and uncertainty. A loss of key personnel or material erosion of employee morale could adversely affect our business and results of operations. Our ability to engage, motivate and retain key employees or take other measures intended to motivate and incentivize key employees to remain with us through the pendency of the Chapter 11 Cases is limited by restrictions on implementation of incentive programs under the Bankruptcy Code. The loss of services of members of our senior management team could impair our ability to execute our strategy and implement operational initiatives, which would be likely to have a material adverse effect on our business, financial condition, results of operations and cash flows. In addition, the longer the Chapter 11 Cases continue, the more likely it is that critical vendors and employees will lose confidence in our ability to reorganize our business successfully.
Aspects of the Chapter 11 Cases limit the flexibility of our management team in running our business.
While we operate our business under supervision by the Bankruptcy Court, we are required to obtain approval of the Bankruptcy Court, and in some cases certain other parties, prior to engaging in activities or transactions outside the ordinary course of business. Bankruptcy Court approval of non-ordinary course activities entails preparation and filing of appropriate motions with the Bankruptcy Court, negotiation with various parties-in-interest, and one or more hearings. Parties-in-interest may be heard at any Bankruptcy Court hearing and may raise objections with respect to these motions. This process may delay major transactions and limit our ability to respond quickly to opportunities and events in the marketplace. Furthermore, in the event the Bankruptcy Court does not approve a proposed activity or transaction, we would be prevented from engaging in activities, transactions and internal restructurings that we believe are beneficial to us, which may have an adverse effect on our business,
17
financial condition, results of operations and cash flows.
Our financial position, revenue, operating results, profitability and cash flows are difficult to predict and may vary from quarter to quarter.
Our quarterly revenue, operating results, profitability and cash flows have varied in the past and are likely to vary significantly from quarter to quarter in the future. The factors that are likely to cause these variations include:
As a result, our revenue, operating results, profitability and cash flows for a particular period are difficult to predict and may decline in comparison to corresponding prior periods regardless of the strength of our business. It is also possible that in some future periods our revenue, operating results and profitability may not meet the expectations of securities analysts or investors. If this occurs, the trading price of our common stock could fall substantially, either suddenly or over time, and our business, operating results and financial condition would be materially harmed.
Any potential remedies that may be enforced by Oaktree in respect of a default under our DIP Credit Agreement could have significant impacts on our business and our ability to successfully emerge from the Chapter 11 Cases.
In connection with the filing of the Chapter 11 Cases, the Debtors entered into a Super-Priority Senior Secured Priming Debtor-in-Possession Credit Agreement and Guaranty, dated as of August 14, 2025 (the “DIP Credit Agreement” and such financing thereunder, the “DIP Financing”), with Oaktree Fund Administration, LLC as administrative agent (the “Administrative Agent”), and the lenders from time to time party thereto (collectively, the “DIP Lenders”), pursuant to which, and subject to the satisfaction of certain conditions, including the approval of the Bankruptcy Court, the DIP Lenders have agreed to provide the Company with a multiple draw term loan facility in an aggregate principal amount not to exceed $82.5 million (the “DIP Facility”). The DIP Credit Agreement
18
contains mandatory and voluntary prepayment provisions customary for transactions of this type (including with respect to proceeds of debt, asset sales, and insurance/condemnation events), which provide that, among other things, voluntary prepayments are permitted without prepayment premiums or penalties. The DIP Credit Agreement also contains certain restrictive loan covenants and events of default customary for credit facilities of this type.
On August 14, 2025, the Company received $7.5 million in new money (“DIP Tranche 1”) borrowings under the DIP Facility, which was used (i) to pay amounts, fees, costs and expenses related to the Chapter 11 Cases and (ii) for working capital and general corporate purposes. Concurrently with the funding of the DIP Tranche 1, the DIP Lenders rolled up their ratable share of Senior Secured Term Loan obligations in an amount equal to two times the amount of new money borrowed under such DIP Tranche 1, or $15.0 million (the “Initial Roll-Up Loan”). The Initial Roll-Up Loan was deemed funded pursuant to the DIP Credit Agreement on a cashless, dollar-for-dollar basis and constituted DIP Financing obligations on the day such roll-up became effective and satisfied and discharged an equal amount of Senior Secured Term Loan obligations as if a payment in such amount had been made on such date. In addition, an upfront commitment fee in an amount equal to 3.00% of the aggregate amount of the DIP Tranche 1 borrowing was fully earned and payable to the DIP Lenders in the form of additional DIP Financing obligations on the funding date of the DIP Tranche 1. As of December 31, 2025, the Company had outstanding borrowings, including accrued interest, of $23.9 million under the DIP Facility.
On March 1, 2026, the Company received a letter from the DIP Lenders that notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
A substantial portion of the wind blade models that we manufacture at our facilities in Mexico are currently subject to reviews by U.S. Customs and Border Protection under the Uyghur Forced Labor Prevention Act, which has prevented us from importing these wind blades into the U.S. and is currently and could continue to have a material, adverse effect on our business, results of operations, and financial condition.
CBP is currently reviewing certain of the wind blade models that are manufactured at our facilities in Mexico pursuant to the Uyghur Forced Labor Prevention Act (“UFLPA”). As a result of these reviews, CBP has restricted the importation of these wind blades into the U.S. while the matter remains under investigation. Although we are confident that our wind blade supply chain does not source materials from the Xinjiang Uyghur Autonomous Region of China, the UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by certain identified entities, are made with forced labor and are therefore prohibited from entry into the U.S. unless the importer can demonstrate otherwise to the satisfaction of CBP.
Because of the current CBP actions, a substantial portion of the wind blades manufactured at our Mexico facilities are unable to be imported into the U.S. market. The inability to import these wind blades has significantly disrupted, and may continue to disrupt, our supply chain, reduce available inventory for U.S. customers, delay deliveries, and result in lost sales. In addition, these CBP reviews have required and may continue to require significant management attention, internal resources, and legal and compliance costs as we work to respond to CBP’s inquiries and further demonstrate compliance with applicable laws.
The outcome and duration of the CBP reviews are uncertain. If we are unable to satisfactorily resolve the matter, CBP may continue to detain, exclude, or seize affected wind blades, which could further restrict our ability to serve customers in the U.S. and may require us to modify our sourcing, manufacturing, or supply chain practices. Any prolonged disruption in our ability to import wind blades into the U.S., or any adverse findings by CBP, will have a further, material adverse effect on our business, financial condition, and results of operations.
19
Our Credit Agreement with Oaktree contains, and any future loan agreements we may enter into may contain, operating and financial covenants that restrict our business and financing activities.
As of December 31, 2025, we had outstanding $476.9 million of senior, secured indebtedness, including principal and paid-in-kind interest, under the Credit Agreement and Guaranty, dated as of December 14, 2023, between the Company and Oaktree Fund Administration, LLC (the Credit Agreement). Our obligations under the Credit Agreement are secured by substantially all of our assets. The Credit Agreement contains various financial covenants and other restrictions regarding, among other things, maintaining minimum cash balances, making capital expenditures and other restricted payments, incurring additional indebtedness, creating liens, and paying dividends.
The commencement of the Chapter 11 Cases constituted an event of default (and an acceleration event) under the Credit Agreement and the enforcement of any remedies in respect of such default and acceleration is automatically stayed as a result of the Chapter 11 Cases.
The fluctuation of foreign currency exchange rates could materially harm our financial results.
Since we conduct a significant portion of our operations internationally, our business is subject to foreign currency risks, including currency exchange rate fluctuations. The exchange rates are affected by, among other things, changes in political and economic conditions. To the extent our future revenues and expenses are generated outside of the U.S. in currencies other than the U.S. dollar, including the Mexican Peso or India Rupee, among others, we will be subject to increased risks relating to foreign currency exchange rate fluctuations which could materially harm our business, financial condition and operating results.
Our manufacturing operations and future growth are dependent upon the availability of capital, which may be insufficient to support our capital expenditures.
Our current wind blade manufacturing activities and future growth will require substantial capital investment. For the years ended December 31, 2025 and 2024, our capital expenditures, including those related to discontinued operations, were $14.5 million and $26.2 million, respectively. We plan to make continued investments in our domestic and international facilities. Our ability to continue to operate and grow our business is predicated on us making significant additional capital investments to expand our existing manufacturing facilities and build and operate new manufacturing facilities in existing and new markets or access capital to acquire new businesses. We may not have the capital to undertake these capital investments. In addition, our capital expenditures may be significantly higher if our estimates of future capital investments are incorrect and may increase substantially if we are required to undertake actions to comply with new regulatory requirements or compete with new technologies. The cost of some projects may also be affected by foreign exchange rates if any raw materials or other goods must be paid for in foreign currency. We cannot assure you that we will be able to raise funds on favorable terms, if at all. We also cannot assure you that completed capital expenditures will yield the anticipated results. If we are unable to obtain sufficient capital at a reasonable cost or at all, we may not be able to expand our business to take advantage of changes in the marketplace or may be required to delay, reduce or eliminate some or all of our current operations, which could materially harm our business, operating results and financial condition.
Our business and reputation could be adversely impacted by any violations of the FCPA, the U.K. Bribery Act, and other foreign anti-corruption laws.
As a U.S. corporation, we are subject to the FCPA, which generally prohibits U.S. companies and their intermediaries from making improper payments to foreign officials for the purpose of obtaining or keeping business. Other countries in which we operate also have anti-corruption laws, some of which prohibit improper payments to government and non-government persons and entities, and others extend their application to activities outside their country of origin. Although FCPA enforcement was recently paused, we plan to continue to comply with the provisions of the FCPA. We have manufacturing facilities in Mexico and India, countries with a fairly high risk of corruption. Those facilities are subject to routine government oversight. In addition, a number of our raw materials and components suppliers are state-owned, particularly in China. Moreover, due to our need to import raw materials across international borders, we also routinely have interactions, directly or indirectly, with customs officials. In many foreign countries, under local custom, businesses engage in practices that may be prohibited by the FCPA or other similar laws and regulations. Additionally, we continue to hire associates around the world to support our
20
international operations. Although we have implemented certain policies, procedures and controls designed to ensure compliance with the FCPA and similar laws, there can be no guarantee that all of our associates and agents, as well as those companies to which we outsource certain of our business operations, have not taken and will not take actions that violate our policies and the FCPA or other anti-corruption laws, which could subject us to fines, penalties, disgorgement, and loss of business, harm our reputation and impact our ability to compete in certain jurisdictions. In addition, these laws are complex and far-reaching in nature, and, as a result, we may be required in the future to alter one or more of our practices to be in compliance with these laws or any changes in these laws or the interpretation thereof. Moreover, our competitors may not be subject to the FCPA or similar laws, which could provide them with a competitive advantage in some jurisdictions.
Effective internal controls are necessary for us to provide reliable financial reports and effectively address fraud risks.
We maintain a system of internal controls to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (GAAP). The process of designing and implementing effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to establish and maintain a system of internal controls that will be adequate to satisfy the reporting obligations of a public company. The effectiveness of our internal controls depends in part on the cooperation of senior managers worldwide.
Any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system are met. Any failure to maintain that system, or consequent inability to produce accurate financial statements on a timely basis, could increase our operating costs and harm our business, and lead to our becoming subject to litigation, sanctions or investigations by the SEC or other regulatory governmental agencies and bodies.
Much of our intellectual property consists of trade secrets and know-how that is very difficult to protect. If we experience loss of protection for our trade secrets or know-how, our business would be substantially harmed.
We have a variety of IP rights, including patents, trademarks and copyrights, but much of our most important IP rights consist of trade secrets and know-how and effective IP protection may be unavailable, limited or outside the scope of the IP rights we pursue in the U.S. and in foreign countries where we operate. Although we strive to protect our IP rights, there is always a risk that our trade secrets or know-how will be compromised or that a competitor could lawfully reverse-engineer our technology or independently develop similar or more efficient technology. We have confidentiality agreements with each of our customers, suppliers, key associates and independent contractors in place to protect our IP rights, but it is possible that a customer, supplier, associate or contractor might breach the agreement, intentionally or unintentionally. It is also possible that our confidentiality agreements with customers, suppliers, associates and contractors will not be effective in preserving the confidential nature of our IP rights. The patents we own could be challenged, invalidated, narrowed or circumvented by others and may not be of sufficient scope or strength to provide us with any meaningful protection or commercial advantage. Once our patents expire, or if they are invalidated, narrowed or circumvented, our competitors may be able to utilize the inventions protected by our patents. Additionally, the existence of our IP rights does not guarantee that we will be successful in any attempt to enforce these rights against third parties in the event of infringement, misappropriation or other misuse, which may materially and adversely affect our business. Because our ability to effectively compete in our industry depends on our ability to protect our proprietary technology, we might lose business to competitors and our business, revenue, operating results and prospects could be materially harmed if we suffer loss of trade secret and know-how protection or breach of our confidentiality agreements.
We may be subject to significant liabilities and costs relating to environmental and health and safety requirements.
We are subject to various environmental, health and safety laws, regulations and permit requirements in the jurisdictions in which we operate governing, among other things, health, safety, pollution and protection of the environment and natural resources, the handling and use of hazardous substances, the generation, storage, treatment and disposal of wastes, and the cleanup of any contaminated sites.
21
We have incurred, and expect to continue to incur, capital and operating expenditures to comply with such laws, regulations and permit requirements. While we believe that we currently are in material compliance with all such laws, regulations and permit requirements, any noncompliance may subject us to a range of enforcement measures, including the imposition of monetary fines and penalties, other civil or criminal sanctions, remedial obligations, and the issuance of compliance requirements restricting our operations.
There can be no assurance that we will not in the future become subject to compliance requirements, obligations to undertake cleanup or related activities, or claims or proceedings relating to environmental, health or safety matters, hazardous substances or wastes, contaminated sites, or other environmental or natural resource damages, that could impose significant liabilities and costs on us and materially harm our business, operating results and financial condition.
Work disruptions resulting from our collective bargaining agreements could result in increased operating costs and materially harm our business, operating results and financial condition.
Certain of our associates in Matamoros, Mexico, which in the aggregate represented approximately 21% of our workforce as of December 31, 2025, are covered by collective bargaining agreements which are in effect through the end of March 2027.
Additionally, our other associates working at other manufacturing facilities may vote to be represented by a labor union in the future. There can be no assurance that we will not experience labor disruptions such as work stoppages or other slowdowns by workers at any of our facilities. Should significant industrial action, threats of strikes or related disturbances occur, or other challenges with negotiating and extending our collective bargaining agreements with our unionized associates, we could experience further disruptions of operations and increased labor costs in Mexico or other locations, which could materially harm our business, operating results or financial condition. Any such work stoppage or slow-down at any of our facilities could also result in additional expenses and possible loss of revenue for us.
Our information technology infrastructure could experience serious failures or cyber security attacks, the failure of which could materially harm our business, operating results and financial condition.
Information technology is part of our business strategy and operations. It enables us to streamline operation processes, facilitate the collection and reporting of business data, and provide for internal and external communications. There are risks that information technology system failures, network disruptions, breaches of data security and phishing and ransomware attacks could disrupt our operations. Any significant disruption or breach may materially harm our business, operating results and financial condition.
Risks Related to Our Wind Business
A significant portion of our business is derived from a small number of customers, therefore any loss of or reduction in purchase orders, failure of these customers to fulfill their obligations or our failure to secure supply agreement renewals from these customers could materially harm our business.
Substantially all of our revenues are derived from two wind blade customers. GE Vernova and Vestas accounted for 56.4% and 41.9%, respectively, of our total net sales for the year ended December 31, 2025, and 52.1% and 35.9%, respectively, of our total net sales for the year ended December 31, 2024, and 41.4% and 39.1%, respectively, of our total net sales for the year ended December 31, 2023. Accordingly, we are substantially dependent on continued business from our current wind blade customers. If one or more of our wind blade customers were to reduce or delay wind blade orders, file for bankruptcy or become insolvent, fail to pay amounts due or satisfactorily perform their respective contractual obligations with us or otherwise terminate or fail to renew their supply agreements with us, our business, financial condition and results of operations could be materially harmed.
We do not have long-term contractual volume commitments from our customers beyond 2025 and our customers may elect not to place new wind blade orders with us or may elect to substantially reduce the volume of wind
22
blades ordered from us due to market conditions and other external factors impacting the demand for wind blades.
Our supply agreements expired at the end of 2025. Although we expect to extend our supply agreements beyond 2025, we currently do not have long-term contractual commitments from our customers to purchase wind blades beyond 2025 primarily due to ongoing negotiations surrounding the Chapter 11 Cases. Our supply agreements generally establish annual purchase requirements on which we rely for our future production and financial forecasts. However, the timing and volume of purchases, within certain parameters, may be subject to change by our customers. If one or more of our customers terminate or reduce the number of manufacturing lines and volumes of wind blades purchased, or fail to enter into new purchase commitments with us, it may materially harm our business, financial condition and results of operations.
Defects in materials and workmanship or wind blade failures could harm our reputation, expose us to product warranty or other liability claims, decrease demand for wind blades we manufacture, or materially harm existing or prospective customer relationships, and our reserves for warranty expenses might not be sufficient to cover all future costs.
Defects in the wind blades we manufacture are unpredictable and an inherent risk in manufacturing technically advanced products that involve a significant amount of manual labor and processes. Defects may arise from multiple causes, including design, engineering, materials, manufacturing and component failures as well as deficiencies in our manufacturing processes. Under our supply agreements, we warranty the materials and workmanship of the wind blades while our customers are responsible for the fitness of use and design of the wind blades. We have experienced multiple wind blade failures and defects at some of our facilities, and we may experience failures or defects in the future. Wind blades that we have manufactured have also failed in the field. Any wind blade failures or other product defects in the future could materially harm our existing and prospective customer relationships. Specifically, negative publicity about the quality of the wind blades we manufacture or defects in the wind blades supplied to our customers could result in a reduction in wind blade orders, increased warranty claims and reserves, product liability claims and other damages or termination of our supply agreements or business relationships with current or new customers. Any of the foregoing could materially harm our business, operating results and financial condition.
We provide warranties for all of the wind blades we produce, including parts and labor, for periods that typically range from two to five years depending on the product sold. We also have offered extended warranties in certain situations to resolve outstanding warranty claims and may offer extended warranties to our customers in the future. Our estimate of warranty expense requires us to make assumptions about matters that are highly uncertain, including future rates of product failure, repair costs, shipping and handling and de-installation and re-installation costs at customers’ sites. Our assumptions could be materially different from the actual performance of our products and these remediation expenses in the future. The expenses associated with wind blade repair and remediation activities can be substantial and may include changes to our manufacturing processes. If our estimates prove materially incorrect, we could incur warranty expenses that exceed our reserves, increase our future warranty reserves, and we could be required to make material unplanned cash expenditures, which could materially harm our business, operating results and financial condition.
We have experienced, and could in the future experience, quality or operational issues in connection with plant construction, expansion or assumption which could result in losses and cause delays in our ability to complete our projects and may therefore materially harm our business, financial condition and results of operations.
We dedicate most of the capacity of our current wind blade manufacturing facilities to existing customers and, as a result, we may need to build additional manufacturing capacity or facilities to serve the needs of new customers or expanded needs of existing customers. We currently conduct wind blade manufacturing operations at four facilities in Mexico, one in India, and one in Iowa in the U.S. The construction of new plants and the expansion or assumption of existing plants involves significant time, cost and other risks. We generally expect our plants to generate losses in their first 12 to 18 months of operations related to production startup costs. Additionally, numerous factors can contribute, and have in the past contributed, to delays or difficulties in the startup of, or the adoption of our manufacturing lines to produce larger wind blade models, which we refer to as model transitions, in our manufacturing facilities. These factors include permitting, construction or renovation delays, defects or issues
23
with product tooling, the engineering and fabrication of specialized equipment, the modification of our general production know-how and customer-specific manufacturing processes to address the specific wind blades to be tested and built, changing and evolving customer specifications and expectations and the hiring and training of plant personnel. Any delays or difficulties in plant startup, expansion or assumption may result in cost overruns, production delays, contractual penalties, loss of revenues, reduced margins and impairment of customer relationships, which could materially harm our business, financial condition and results of operations.
We have experienced in the past, and our future wind blade production could be affected by, operating problems at our facilities, which may materially harm our operating results and financial condition.
Our wind blade manufacturing processes and production capacity have in the past been, and could in the future be, disrupted by a variety of issues, including:
The cost of repeated or prolonged interruptions, reductions in production capacity, or the repair or replacement of complex and sophisticated tooling and equipment may be considerable and could result in damages or the termination of our supply agreements or penalties for regulatory non-compliance, any of which could materially harm our business, operating results and financial condition.
Although a majority of our manufacturing facilities are located outside the U.S., our business is still heavily dependent upon the demand for wind energy in the U.S. and any downturn in demand for wind energy in the U.S. could materially harm our business.
We have developed a strategic manufacturing footprint to serve the growing wind energy market worldwide and have wind blade manufacturing facilities in the U.S., Mexico, and India. Although a majority of our manufacturing facilities are located outside of the U.S., historically more than half of the wind blades that we produced were deployed in wind farms located within the U.S. The wind blades manufactured at our Iowa facility, where production restarted in the second half of 2025, and substantially all of the wind blades manufactured at our Mexico facilities, are deployed within the U.S. In addition, many of our wind blades are exported from our India manufacturing facility to the U.S. Consequently, demand for wind energy and our wind blade sales could be adversely affected by a variety of reasons and factors, including the tariffs on goods and products imported into the U.S. and other regulatory or legal changes or developments relating to wind and renewable energy in the U.S. Any downturn in demand for wind energy in the U.S. could materially harm our business.
We have experienced volatility in the price and availability of raw materials and components that are critical to our manufacturing needs, as well as ongoing inflationary pressures impacting many of our labor and other costs, and we may continue to, or in the future, experience price increases, supply constraints, and inflationary pressures, which may hinder our ability to perform under our supply agreements and adversely impact our competitive position, profitability and financial condition.
We rely upon third parties for raw materials, such as fiberglass, carbon fiber, resins, foam core and balsa wood, and various components for the products we manufacture. Some of these raw materials and components may
24
only be purchased from a limited number of suppliers. Current geopolitical climate, and the economic environment generally, including with respect to inflation and trade policies, continue to evolve and affect supply chain performance and underlying assumptions in various ways – specifically with volatility in commodity, energy, and logistics costs. However, the overall pricing for the raw materials that we source decreased in 2025 compared to 2024 due to decreases in pricing and logistics costs. We expect to see a further decrease in material pricing in 2026.
Additionally, our ability to purchase the appropriate quantities of raw materials is impacted by our customers’ transitioning wind blade designs and specifications. As a result, we maintain, closely monitor and manage inventory and acquire raw materials and components as needed and with consideration to lead time factors. Due to fluctuating international demand for these raw materials from many industries, and extended logistics lead times, we may be unable to acquire sufficient quantities or secure a stable supply for our manufacturing needs. One of our customers sources all of the critical raw materials that we use to produce such customers' wind blades. Since we do not source procurement of these raw materials for this customer, we have fewer controls and remedies to mitigate raw material and supply chain risks and disruptions relating to such raw materials for such customer.
In 2025, we procured approximately 22% of our raw materials from China, so any ocean logistic delays, weather events, strikes, other force majeure events or geopolitical developments impacting China could disrupt our supply chain. In addition, a disruption in any aspect of our global supply chain caused by transportation delays, customs delays, cost issues or other factors could result in a shortage of raw materials or components critical to our manufacturing needs. Any supply shortages, delays in the shipment of materials or components from third party suppliers, or changes in the terms on which they are available could disrupt or materially harm our business, operating results and financial condition.
Ongoing inflationary pressures have caused and may continue to cause many of our material, labor, and other costs to increase, which can have adverse impacts on our results of operations. The government of Mexico increased minimum wages approximately 20%, 12% and 13%, effective January 1, 2024, 2025 and 2026, respectively. While our customer contracts allow us to pass a portion of these increases to our customers, we were not able to recover 100% of the wage inflation. If our Mexico manufacturing facilities continue to experience wage inflation at these levels and the increased costs in local currency are not offset with favorable foreign currency fluctuations, such elevated wages could further deteriorate our competitive position, and have a material impact on our results of operations and financial condition.
Demand for the wind blades we manufacture may fluctuate for a variety of reasons, including the growth of the wind industry, and decreases in demand could materially harm our business and may not be sufficient to support our growth strategy.
Our revenues, business prospects and growth strategy heavily depend on the continued growth of the wind industry and our customers’ continuing demand for wind blades. Customer demand could decrease from anticipated levels due to numerous factors outside of our control that may affect the development of the wind energy market generally, portions of the market or individual wind project developments, including:
25
In 2025, we experienced a decline in demand for our wind blades due primarily to regulatory uncertainty as our customers and wind farm developers continued to defer investments into the future until inflationary pressure and global economies stabilize, and there is clearer regulatory guidance. This decline in demand adversely impacted our operating results for 2025. In addition to factors affecting the wind energy market generally, our customers’ demand may also fluctuate based on other factors beyond our control. Any decline in customer demand below anticipated levels could materially harm our revenues and operating results and could delay or impede our growth strategy.
We operate a substantial portion of our business in international markets and we may be unable to effectively manage a variety of currency, legal, regulatory, economic, social and political risks associated with our global operations and those in developing markets.
We currently operate manufacturing facilities in the U.S., Mexico, and India. For the years ended December 31, 2025, 2024 and 2023, approximately 93%, 98% and 97%, respectively, of our net sales were derived from our international operations. Our overall success depends, in part, upon our ability to succeed in differing legal, regulatory, economic, social and political conditions. The global nature of our operations is subject to a variety of risks, including:
26
As we continue to operate our business globally, our success will depend, in part, on our ability to anticipate and effectively manage these and other related risks. We may be unsuccessful in developing and implementing policies and strategies that will be effective in managing these risks in each country where we do business or conduct operations. Our failure to manage these risks successfully could materially harm our business, operating results and financial condition.
A drop in the price of energy sources other than wind energy, or our inability to deliver wind blades that compete with the price of other energy sources, may materially harm our business, financial condition and results of operations.
We believe that the decision to purchase wind energy is, to a significant degree, driven by the relative cost of electricity generated by wind turbines compared to the applicable price of electricity from traditional (i.e., thermal) and other renewable energy sources. Decreases in the prices of electricity from traditional or renewable energy sources other than wind energy, such as solar, could harm the market for wind energy. In particular, a drop in natural gas prices could lessen the appeal of wind-generated electricity. Technological advancements or the construction of a significant number of power generation plants, including nuclear, coal, natural gas or power plants utilizing other renewable energy technologies, government support for other forms of renewable energy or construction of additional electric transmission and distribution lines could reduce the price of electricity produced by competing methods, thereby making the purchase of wind energy less attractive. The ability of energy conservation technologies, public initiatives and government incentives to reduce electricity consumption or support other forms of renewable energy could also lead to a reduction in the price of electricity, which would undermine the attractiveness of wind energy and thus wind turbines, and, ultimately wind blades. If prices for electricity generated by wind turbines are not competitive, our business, financial condition and results of operations may be materially harmed.
We encounter intense competition for limited customers from other wind blade manufacturers, as well as in-house production by wind turbine OEMs, which may make it difficult to enter into supply agreements, keep existing customers and potentially get new customers.
We face significant competition from other wind blade manufacturers, and this competition may intensify in the future. The wind turbine market is characterized by a relatively small number of large OEMs. The competitive environment in the wind energy industry recently has become more challenging primarily due to ongoing regulatory uncertainty and wage inflation. This challenging environment may lead to further consolidation in the industry, which could lead to us having even fewer customers. In addition, a significant percentage of wind turbine OEMs, including all of our current customers, produce some of their own wind blades in-house. As a result, we compete for business from a limited number of customers that outsource the production of wind blades. We also compete with a number of wind blade manufacturers in China, who are growing in terms of their technical capability and are in the process of expanding outside of China. Some of our competitors have more experience in the wind energy industry, as well as greater financial, technical or human resources than we do, which may limit our ability to compete effectively with them and maintain or improve our market share. Additionally, our supply agreements dedicate capacity at our facilities to our customers, which may also limit our ability to compete if our facilities cannot accommodate additional capacity. If we are unable to compete effectively for the limited number of customers that outsource production of wind blades, our ability to enter into supply agreements with potential new and existing customers may be materially harmed.
Various legislation, infrastructure, regulations including permitting and siting and incentives that are expected to support the growth of wind energy in the U.S. and around the world may not be extended or may be discontinued, phased out or changed, or may not be successfully implemented, which could materially harm wind energy programs and materially decrease demand for the wind blades we manufacture.
The U.S. wind energy industry has been dependent in part upon governmental support through certain incentives including federal tax incentives and state RPS programs and may not be economically viable if a large
27
number of these incentives are not continued. Government-sponsored tax incentive programs including the PTC, and the Investment Tax Credit (ITC) have supported the U.S. growth of wind energy. In August 2022, the PTC was extended until the later of 2032 or when greenhouse gas emissions have been reduced by 75% compared to 2022. In addition, a new advanced manufacturing production tax credit (AMPC) was created that can be claimed for the domestic production and sale of clean energy components, such as wind blades. However, in July 2025, the OBBBA was signed into law in the U.S., which resulted in the AMPC being phased out earlier than initially expected, with the credit expiring at the end of December 31, 2027. In addition, the U.S. Presidential administration has issued executive orders that have impacted the onshore wind market, including halting the issuance of permits and leases for new wind projects on public lands in the U.S. pending additional review from multiple federal agencies, resulting in further uncertainty in the wind market.
There can be no assurance that governmental programs or subsidies for renewable energy such as the IRA will remain in effect in their present form or at all, or that the required transmission infrastructure expansion occurs, and the elimination, reduction, or modification of these programs or subsidies could materially harm wind energy programs in the U.S. and international markets and materially decrease demand for the wind blades we manufacture and, in turn, materially harm our business, operating results and financial condition.
Risks Related to Ownership of Our Common Stock
We expect that our common stock will be cancelled without any value delivered to shareholders as a result of the Chapter 11 Cases. Any trading in our common stock during the pendency of our Chapter 11 Cases is highly speculative and poses substantial risks to purchasers of our common stock.
In connection with the Chapter 11 Cases, we expect that our common stock will be cancelled. We have a significant amount of indebtedness and other liabilities that are senior to our current shares of common stock in our capital structure, and it is expected that any available value will be distributed in respect of such indebtedness and liabilities and not our common stock. In addition, the value of our existing common stock has substantially decreased leading up to the Chapter 11 Cases. Accordingly, any trading in our common stock during the pendency of our Chapter 11 Cases is highly speculative and poses substantial risks to purchasers of our common shares.
There is no assurance that an active market in our common stock will continue at present levels or at all.
On August 19, 2025, our common stock was delisted from Nasdaq and is currently quoted in the over-the-counter (the “OTC”) market. OTC is a significantly more limited market than Nasdaq, and quotation on the OTC will likely result in a less liquid market for existing and potential holders of the common stock to trade our common stock and could further depress the trading price of our common stock. There is no guarantee that our common stock will be regularly traded on the OTC, and accordingly, our common stock may become illiquid. We can provide no assurance as to whether broker-dealers will continue to provide public quotes of the common stock on this market, or whether the trading volume of the common stock will be sufficient to provide for an efficient trading market. There is no assurance that an active market for our common stock will continue at present levels or at all, including as a result of being delisted from Nasdaq. As a result, an investor may find it difficult to dispose of our common stock on the timeline and at the volumes they desire, which may limit the liquidity of our common stock and may have a material adverse effect on the market price of our common stock and on our ability to raise additional capital.
The termination of the registration of our common stock under the Exchange Act could negatively affect the liquidity and trading prices of our common stock.
We expect to file with the SEC a Form 15, Notice of Termination of Registration and Suspension of Duty to File, to voluntarily deregister our common stock and suspend reporting obligations under the Exchange Act as soon as possible. Deregistering our common stock could negatively affect the liquidity, trading volume and trading prices of our common stock. Further, after filing the Form 15, we will not be required to file periodic or current reports with the SEC or provide certain information to our stockholders under the Exchange Act, and many provisions of the Exchange Act will become inapplicable to us.
28
Provisions of Delaware law or our charter documents could delay or prevent an acquisition of our Company, even if the acquisition would be beneficial to our stockholders and could make it more difficult for you to change management.
Provisions of Delaware law and our amended and restated certificate of incorporation and amended and restated by-laws may discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions may also prevent or delay attempts by stockholders to replace or remove our current management or members of our board of directors. These provisions include: a classified board of directors; limitations on the removal of directors; advance notice requirements for stockholder proposals and nominations; the inability of stockholders to act by written consent or to call special meetings; the ability of our board of directors to make, alter or repeal our amended and restated by-laws; and the authority of our board of directors to issue preferred stock with such terms as our board of directors may determine.
The affirmative vote of the holders of at least 75% of our shares of capital stock entitled to vote, and not less than 75% of the outstanding shares of each class entitled to vote thereon as a class, is necessary to amend or repeal the above provisions that are contained in our amended and restated certificate of incorporation. In addition, absent approval of our board of directors, our amended and restated by-laws may only be amended or repealed by the affirmative vote of the holders of at least 75% of our shares of capital stock entitled to vote.
In addition, we are subject to the provisions of Section 203 of the Delaware General Corporation Law, which limits business combination transactions with stockholders of 15% or more of our outstanding voting stock that our board of directors has not approved. These provisions and other similar provisions make it more difficult for stockholders or potential acquirers to acquire us without negotiation. These provisions may apply even if some stockholders may consider the transaction beneficial to them.
As a result, these provisions could limit the price that investors are willing to pay in the future for shares of our common stock. These provisions might also discourage a potential acquisition proposal or tender offer, even if the acquisition proposal or tender offer is at a premium over the then current market price for our common stock.
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Risk Management and Strategy
We have instituted policies and processes dedicated to assessing, identifying, and managing risks from cybersecurity threats. Cybersecurity risks are managed as part of our enterprise risk management program. We are committed to safeguarding our critical information assets and data and have implemented a defense-in-depth strategy that is informed by industry standard cybersecurity frameworks. We benchmark against these frameworks and our internal risk assessment process to inform how we identify, protect, detect, respond to, and recover from risks, threats, vulnerabilities, and cybersecurity incidents across our information assets.
We actively enhance our cybersecurity program through testing by third-party assessors and measure the results against industry standards. We also have standing engagements with incident response experts and external
29
counsel to provide timely support to our incident response capabilities, and we regularly
Our cybersecurity risk management is
Governance
Our chief information officer and chief information security officer assess our cybersecurity readiness through internal assessment tools, as well as third-party assessments, audits, penetration tests, and evaluation against industry standards. We have governance and compliance structures that are designed to elevate issues relating to cybersecurity to our chief information officer and chief information security officer, as appropriate.
Our chief information officer meets with the Audit Committee each quarter to review our information technology systems and discuss key cybersecurity risks. In addition, at least annually, the chief financial officer reviews with the board of directors our global enterprise risk management program, which includes cybersecurity risks.
30
Item 2. Properties
Our headquarters is located in Scottsdale, Arizona, and we lease various other facilities in the U.S., Mexico, India, Denmark, Germany and Spain. We believe that our properties are generally in good condition, are well maintained and are generally suitable and adequate to carry out our business at expected capacity for the foreseeable future. The table below lists various information regarding our facilities as of March 25, 2026:
|
|
Operating |
|
Year |
|
Leased or |
|
Approximate |
|
|
|
|
Location |
|
Segment |
|
Commenced |
|
Owned |
|
Square |
|
|
Description of Use |
|
Newton, IA, U.S. |
|
U.S. |
|
2008 |
|
Leased |
|
|
337,922 |
|
|
Wind Blade Manufacturing Facility |
Juárez, Mexico |
|
Mexico |
|
2013 |
|
Leased |
|
|
345,984 |
|
|
Wind Blade Manufacturing Facility |
Juárez, Mexico |
|
Mexico |
|
2016 |
|
Leased |
|
|
453,096 |
|
|
Wind Blade Manufacturing Facility |
Juárez, Mexico |
|
Mexico |
|
2016 |
|
Leased |
|
|
339,386 |
|
|
Wind Blade Manufacturing Facility |
Matamoros, Mexico |
|
Mexico |
|
2017 |
|
Leased |
|
|
527,442 |
|
|
Wind Blade Manufacturing Facility |
Santa Teresa, NM, U.S. |
|
Mexico |
|
2014 |
|
Leased |
|
|
503,710 |
|
|
Wind Blade Storage Facility |
Kolding, Denmark |
|
U.S. |
|
2018 |
|
Leased |
|
|
2,583 |
|
|
Advanced Engineering Center |
Chennai, India |
|
India |
|
2019 |
|
Leased |
|
|
776,280 |
|
|
Wind Blade Manufacturing Facility |
Madrid, Spain |
|
EMEA |
|
2021 |
|
Leased |
|
|
26,124 |
|
|
Wind Blade Services Facility |
Scottsdale, AZ, U.S. |
|
U.S. |
|
2023 |
|
Leased |
|
|
12,993 |
|
|
Corporate Headquarters |
Berlin, Germany |
|
U.S. |
|
2023 |
|
Leased |
|
|
4,239 |
|
|
Engineering Center |
Des Moines, IA, U.S. |
|
U.S. |
|
2023 |
|
Leased |
|
|
26,640 |
|
|
Wind Blade Services Facility |
Santa Teresa, NM, U.S. |
|
U.S. |
|
2025 |
|
Leased |
|
|
16,000 |
|
|
Research and Development Facility |
Item 3. Legal Proceedings
For a discussion of our legal proceedings, refer to Note 18 – Commitments and Contingencies – Legal Proceedings of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
Item 4. Mine Safety Disclosures
Not applicable.
31
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Market Information
Until August 19, 2025, our common stock was traded on Nasdaq under the symbol “TPIC.” On August 19, 2025, the Company’s common stock was delisted from Nasdaq. Our common stock is available for quotation on the OTC Pink Market under the symbol “TPICQ”.
Holders
As of February 28, 2026, there were five stockholders of record of our common stock, which does not include a greater number of holders whose shares are held of record by banks, brokers, and other financial institutions.
Dividends
We have never declared or paid any cash dividends on shares of our capital stock. We currently intend to retain earnings, if any, to finance the development and growth of our business and do not anticipate paying cash dividends on the common stock in the future. Any payment of any future dividends to holders of our common stock, will be at the discretion of the board of directors and subject to compliance with certain covenants in our loan agreements, after taking into account various factors, including our financial condition, operating results, capital requirements, restrictions contained in any future financing instruments, growth plans and other factors the board of directors deems relevant. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” included in Part II, Item 7 of this Annual Report on Form 10-K.
Securities Authorized for Issuance under Equity Compensation Plans
The information required in response to Item 201(d) of Regulation S-K is set forth in Part III, Item 12 of this Annual Report on Form 10-K which is incorporated herein by reference.
Recent Sales of Unregistered Securities
There were no unregistered sales of equity securities during the year ended December 31, 2025 and from the period from December 31, 2025 to the filing date of this Annual Report on Form 10-K which have not previously been disclosed in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.
Use of Proceeds from Registered Securities
None.
Purchases of Equity Securities by the Issuer
The following table summarizes the total number of shares of our common stock that we repurchased during the three months ended December 31, 2025 from certain associates who surrendered common stock to pay the taxes in connection with the vesting of restricted stock units.
32
Period |
|
Total Number |
|
|
Average Price |
|
|
Total Number |
|
|
Maximum Number of Shares That May |
|
||||
October (October 1 - October 31) |
|
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
|
— |
|
November (November 1 - November 30) |
|
|
26,954 |
|
|
|
0.03 |
|
|
|
— |
|
|
|
— |
|
December (December 1 - December 31) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total |
|
|
26,954 |
|
|
$ |
0.03 |
|
|
|
— |
|
|
|
— |
|
Item 6. [Reserved]
33
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes included in Part II, Item 8 of this Annual Report on Form 10-K and other financial information appearing elsewhere in this Annual Report on Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those described in or implied by these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this Annual Report on Form 10-K, particularly those under “Risk Factors” included in Part I, Item 1A of this Annual Report on Form 10-K.
OVERVIEW
Our Company
We are an independent manufacturer of composite wind blades for the wind energy market with a manufacturing footprint currently in the U.S., Mexico, and India. We deliver high-quality, cost-effective composite solutions through long-term relationships with leading original equipment manufacturers in the wind market. We also provide field service inspection and repair services to our OEM customers and wind farm owners and operators. We are headquartered in Scottsdale, Arizona and operate wind blade manufacturing facilities in the U.S., Mexico, and India. We operate additional engineering development centers in Denmark and Germany, and field services facilities in the U.S. and Spain. For a further overview of our Company, refer to the discussion in “Business—Overview” included in Part I, Item 1 of this Annual Report on Form 10-K.
We completed the divestiture of our automotive business in June 2024, our tooling business in August 2025, and our Türkiye business in September 2025. The Company determined that the sale of the Türkiye and automotive businesses represented strategic shifts that had major effects on the Company’s operations and financial results. Accordingly, the historical results of the Türkiye and automotive businesses have been reclassified as discontinued operations for all periods presented in the consolidated financial statements.
The following discussion reflects continuing operations only, unless otherwise indicated. For further information regarding our discontinued operations, refer to Note 4 – Discontinued Operations of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
Voluntary Petitions for Reorganization under Chapter 11 and Section 363 Sale Process
The Chapter 11 Cases were filed in order to facilitate a financial and operational restructuring of the Company’s business and balance sheet. The Company continues to operate its business as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. The Debtors filed customary “first-day” motions with the Bankruptcy Court seeking authorization to support ongoing operations during the Chapter 11 Cases, including to (i) pay employee wages and benefits, (ii) pay certain critical vendors and suppliers for goods and services provided before the commencement of the Chapter 11 Cases, (iii) establish procedures for trading the Company’s stock, and (iv) continue honoring insurance and tax obligations as they come due.
The Debtors also filed a motion seeking approval of procedures for the sale of all or any of the Debtors’ assets pursuant to section 363 of the Bankruptcy Code. The Transaction Committee of the Company’s Board of Directors engaged third parties to advise on the Company’s strategic options, including a potential sale of all, substantially all, or a portion of the Debtors’ assets in connection with the Chapter 11 Cases. The Company has incurred, and continues to incur, material reorganization expenses as a result of the Chapter 11 Cases.
Automatic Stay
The commencement of the Chapter 11 Cases constituted an event of default that accelerated all of the Company’s obligations under the documents governing the 11% Senior Secured Term Loan (“the Term Loan”) and the 5.25% Convertible Senior Unsecured Notes (the “Convertible Notes”), amounting to borrowings of approximately $471.8 million and $135.3 million, respectively, as of the petition date, including accrued but unpaid
34
interest in respect thereof, as well as obligations under other Company agreements. As a result of the commencement of the Chapter 11 Cases, the principal amount, together with accrued and unpaid fees and interest thereon, and in the case of the indebtedness outstanding under the Senior Secured Term Loan, the paid-in-kind interest, became immediately due and payable. Any efforts to enforce payment obligations under the debt instruments are automatically stayed as a result of the Chapter 11 Cases and the creditors’ rights in respect of the debt instruments are subject to the applicable provisions of the Bankruptcy Code. As a result of the forgoing acceleration event, all of the Company's outstanding indebtedness, including indebtedness subject to cross default provisions, has been classified as current debt in the accompanying consolidated balance sheet as of December 31, 2025.
DIP Financing
In connection with the filing of the Chapter 11 Cases, the Debtors entered into a DIP Credit Agreement, pursuant to which, the DIP Lenders have agreed to provide the Company with a multiple draw term loan facility in an aggregate principal amount not to exceed $82.5 million (the “DIP Facility”).
Under the DIP Facility, (i) $7.5 million of new money (the “DIP Tranche 1”) became available following Bankruptcy Court approval of the DIP Credit Agreement on an interim basis (the “Interim DIP Order”) on August 13, 2025, and (ii) up to $20 million of new money (the “DIP Tranche 2”) will become available, subject to the satisfaction of certain other funding conditions, following Bankruptcy Court approval of the DIP Facility on a final basis (the “Final DIP Order”) on October 14, 2025, and (iii) up to $55 million of the principal amount outstanding under the senior secured term loan (“Senior Secured Term Loan”) issued under the existing Credit Agreement and Guaranty, dated as of December 14, 2023, by and among the Company, as the borrower, the Companies parties thereto as guarantors, the senior secured lenders party thereto, as the lenders, and Oaktree Fund Administration, LLC, as the administrative agent (as amended, restated, or otherwise modified from time to time prior to the date thereof, the “Existing Credit Agreement”), may be rolled into the DIP Facility, subject to the terms of the DIP Credit Agreement and approval from the Bankruptcy Court.
The DIP Facility will mature nine months from the Petition Date. The interest on the loans shall accrue at a per annum rate equal to SOFR + 9%, which interest shall be payable in kind. Upon the occurrence and during the continuance of an event of default, unless otherwise waived by the DIP Lenders, the interest rate on all obligations (including interest on overdue principal, interest and other amounts) shall accrue at an additional 2% per annum. The DIP Credit Agreement contains mandatory and voluntary prepayment provisions customary for transactions of this type (including with respect to proceeds of debt, asset sales, and insurance/condemnation events), which provide that, among other things, voluntary prepayments are permitted without prepayment premiums or penalties. The DIP Credit Agreement also contains certain restrictive loan covenants and events of default customary for credit facilities of this type.
On August 14, 2025, the Company received $7.5 million in DIP Tranche 1 borrowings under the DIP Facility, which was used (i) to pay amounts, fees, costs and expenses related to the Chapter 11 Cases and (ii) for working capital and general corporate purposes. Concurrently with the funding of the DIP Tranche 1, the DIP Lenders rolled up their ratable share of Senior Secured Term Loan obligations in an amount equal to two times the amount of new money borrowed under such DIP Tranche 1, or $15.0 million (the “Initial Roll-Up Loan”). The Initial Roll-Up Loan was deemed funded pursuant to the DIP Credit Agreement on a cashless, dollar-for-dollar basis and constituted DIP Financing obligations on the day such roll-up became effective, and satisfied and discharged an equal amount of Senior Secured Term Loan obligations as if a payment in such amount had been made under the Existing Credit Agreement on such date. In addition, an upfront commitment fee in an amount equal to 3.00% of the aggregate amount of the DIP Tranche 1 borrowing was fully earned and payable to the DIP Lenders in the form of additional DIP Financing obligations on the funding date of the DIP Tranche 1. As of December 31, 2025, the Company had outstanding borrowings of $23.9 million under the DIP Facility, consisting of $7.5 million of DIP Tranche 1 borrowings, $15.0 million of Initial Roll-Up Loans, $0.2 million of commitment fees, and $1.2 million of paid in kind interest.
DIP Default
On March 1, 2026, the Company received a letter from the DIP Lenders regarding an Event of Default occurring under the DIP Credit Agreement. The letter notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any
35
other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
KEY TRENDS AND RECENT DEVELOPMENTS AFFECTING OUR BUSINESS
Market update
Geopolitical events around the world have accelerated regional needs for energy independence and security. Climate change also continues to drive the need for renewable energy solutions and net-zero carbon emissions. The global demand for clean energy continues to rise, driven by factors such as the growing need for data centers dedicated to artificial intelligence, semiconductor chip manufacturers, the adoption of electric vehicles, and the electrification of buildings.
The U.S. continues to be our most important market. However, the U.S. market has been impacted by recent government policy uncertainty for renewable energy coming from the current administration, which has resulted in a reduction in orders and investment dollars flowing into wind projects. In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S., which significantly changes the current wind energy tax credits, and phases out certain tax credits for wind components produced and sold after December 31, 2027. While this may result in higher near-term demand for wind blades in order for our customers to qualify for tax credits prior to expiration, these changes could have long-term implications that contribute to an overall lower outlook in the U.S. wind market.
We continue to monitor the global tariffs announced by the U.S. and assess the impacts of such tariffs on our business. Currently, the wind blades manufactured in our Mexico facilities that are imported into the U.S. are exempt from tariffs as they qualify under the U.S.-Mexico-Canada Agreement (USMCA) that has been in effect since July 2020. The wind blades manufactured in our India facilities are typically transferred to our customers once they have left our facilities and any import duties at the final installation destination are borne by our customers. We are subject to current tariffs on certain raw materials imported into the U.S. and/or Mexico for use in production at our recently started Iowa manufacturing facility as well as our Mexico manufacturing facilities, but these are not expected to have a material impact on our business and can generally be passed on to our customers. In addition, on August 13, 2025, the U.S. Department of Commerce initiated an investigation into the national security implications of importing wind turbines, parts, and components under Section 232 of the Trade Expansion Act of 1962 (“Section 232”). This Section 232 investigation is still ongoing and may potentially lead to new tariffs on our wind blade products that are imported into the U.S. and the materials we source to manufacture such wind blades. The current environment in the U.S. surrounding tariffs has been extremely fluid under the current presidential administration, and potential revisions to the U.S. tariff structure could materially affect the company’s results of operations.
During the year ended December 31, 2025, our results of operations in Mexico were significantly impacted by lower than expected production volume due to temporary production stoppages subsequent to the Petition Date due to material shortages and supply chain challenges as a result of the Chapter 11 Cases. Our liquidity and results of operations were also significantly impacted in the fourth quarter of 2025, due to temporary delays on the import of finished wind blades from Mexico into the U.S.
Ongoing inflationary pressures have caused and may continue to cause many of our production expenses to increase, which adversely impacts our results of operations. The government of Mexico increased minimum wages approximately 13% and 22%, effective January 1, 2026 and 2025, respectively. In March 2025, we agreed to an amendment to our collective bargaining agreement with our associates in Matamoros, Mexico, and extended such agreement through March 2027. While our customer contracts allow us to pass a portion of these increases to our customers, we will not be able to recover 100% of the increased labor costs caused by this wage inflation. If our manufacturing facilities in Mexico continue to experience wage inflation and the increased costs in local currency are not offset with favorable foreign currency fluctuations, such elevated wages will have a material impact on our results of operations.
Customs Review
36
U.S. Customs and Border Protection (“CBP”) is currently reviewing certain of the wind blade models that are manufactured at our facilities in Mexico pursuant to the Uyghur Forced Labor Prevention Act (“UFLPA”). As a result of these reviews, CBP has restricted the importation of these wind blades into the U.S. while the matter remains under investigation. Although we are confident that our wind blade supply chain does not source materials from the Xinjiang Uyghur Autonomous Region of China, the UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by certain identified entities, are made with forced labor and are therefore prohibited from entry into the U.S. unless the importer can demonstrate otherwise to the satisfaction of CBP.
Because of the current CBP actions, a substantial portion of the wind blades manufactured at our Mexico facilities are unable to be imported into the U.S. market. The inability to import these wind blades has significantly disrupted, and may continue to disrupt, our supply chain, reduce available inventory for U.S. customers, delay deliveries, and result in lost sales. In addition, these CBP reviews have required and may continue to require significant management attention, internal resources, and legal and compliance costs as we work to respond to CBP’s inquiries and further demonstrate compliance with applicable laws.
The outcome and duration of the CBP reviews are uncertain. If we are unable to satisfactorily resolve the matter, CBP may continue to detain, exclude, or seize affected wind blades, which could further restrict our ability to serve customers in the U.S. and may require us to modify our sourcing, manufacturing, or supply chain practices. Any prolonged disruption in our ability to import wind blades into the U.S., or any adverse findings by CBP, will have a further, material adverse effect on our business, financial condition, and results of operations.
Sale of Turkish Operations
While long-term onshore market growth in Europe remains in sight, the economic viability of pursuing that demand with European-based manufacturing is becoming increasingly challenging. Historically, we have serviced the European market with our plants in Türkiye. However, the hyperinflationary environment in Türkiye and Türkiye’s monetary policy continues to limit Turkish Lira devaluation, resulting in a very challenging environment to export goods out of Türkiye. Furthermore, while we have successfully competed with Chinese wind blade manufacturers for years, their recent aggressive push to expand their presence in Europe and other regions outside of North America, supported by the Chinese government, has added to the challenging competitive environment outside of the U.S. Unlike the U.S., which has implemented tariffs to protect against unfair competition and tax laws to encourage near shoring and domestic manufacturing, European governments have not taken similar steps to meaningfully help suppliers like us that supply components to our OEM customers. The implementation of the Foreign Subsidies Regulation (FSR) by the EU and its recent more aggressive actions to combat unfairly subsidized Chinese products are encouraging, but their focus to date has been on protecting OEMs and active parts of wind turbines that could potentially be controlled remotely versus passive parts, such as the blades that we manufacture for our customers. As a result of these market factors and the ongoing labor strike by the manufacturing production employees at the two facilities in Türkiye, the Company began pursuing strategic alternatives with respect to its operations in Türkiye. On September 10, 2025, the Company completed the sale and transfer of its equity interests in the Turkish business on an “as-is” basis, whereby the purchaser acquired all assets and assumed all liabilities, including the debt obligations of the Turkish subsidiaries, recognizing a $10.3 million gain on sale of discontinued operations.
Vestas Transaction
On March 4, 2026, following a competitive marketing process to sell all or part of the Debtors’ asset pursuant to section 363 of the Bankruptcy Code, the Company and certain of its direct and indirect subsidiaries (collectively, the “Sellers”), entered into various agreements with Vestas Wind Systems A/S and certain of its subsidiaries (collectively, “Vestas”), pursuant to which the Company will sell and transfer its manufacturing business in Chennai, India for a purchase price of approximately $10.0 million, and its manufacturing business in Matamoros, Mexico for a purchase price of approximately $14.0 million (collectively, the “Vestas Sale Transactions”). The Sellers currently manufacture wind blades for Vestas at these facilities. In each instance, the Vestas Sale Transactions are subject to certain purchase price adjustments and the assumption of certain liabilities and are subject to a number of closing conditions and may be terminated by either party under certain circumstances,
37
including among others, if the Vestas Sale Transactions are not closed by June 30, 2026. Refer to Note 24 – Subsequent Events for further information regarding the Vestas Sale Transactions.
ECP Transaction
Further, on March 6, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “ECP Seller Parties”) entered into a Stock and Asset Purchase Agreement (the “ECP Purchase Agreement”) with ECP Blade Holdings LLC (“ECP Buyer”). Pursuant to the ECP Purchase Agreement, the ECP Seller Parties will sell and transfer to ECP Buyer (i) all of the equity interests of certain foreign indirect subsidiaries of the Company, and (ii) substantially all of the assets primarily related to the Company’s wind blade manufacturing business at facilities located in the U.S. and Mexico, other than the assets to be sold pursuant to the Vestas Sale Transaction (the “ECP Business”) in exchange for approximately $20.0 million in cash, subject to certain purchase price adjustments and the assumption of certain liabilities, each as set forth in the ECP Purchase Agreement (the “ECP Sale Transaction”). The ECP Sale Transaction is subject to a number of closing conditions and may be terminated by either party under certain circumstances, including among others, if the ECP Sale Transaction has not been consummated by June 30, 2026, subject to extension in certain circumstances. Refer to Note 24 – Subsequent Events for further information regarding the ECP Sale Transaction.
GE Vernova Transaction
Additionally, on March 16, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “Back-Up Bidder Seller Parties”) entered into a Term Sheet (the “GE Vernova Term Sheet”) with GE Vernova International LLC (“GE Vernova”), setting forth the terms of definitive documentation to be entered into among the Back-Up Bidder Seller Parties and GE Vernova (the “Back-Up Bidder Documentation”). Pursuant to the GE Vernova Term Sheet, in the event that the ECP Purchase Agreement is terminated and subject to other conditions set forth in the GE Vernova Term Sheet, the Back-Up Bidder Seller Parties will sell and transfer to GE Vernova, free and clear of all liens, interests, and encumbrances (except as will be set forth in the Back-Up Bidder Documentation) pursuant to section 363 of the Bankruptcy Code certain assets of the Back-Up Bidder Seller Parties, including assets related to wind blade manufacturing at our Iowa facility and all related storage facilities used in connection with such manufacturing and other intellectual property related to wind blade manufacturing of the blade types (including, but not limited to, design, technical support, and other items) (the “GEV Business”), in exchange for approximately $21.0 million in cash (the “GE Vernova Transaction”). Pursuant to the GE Vernova Term Sheet, the consummation of the GE Vernova Transaction shall be subject to a number of closing conditions, including, among other things, (i) entry by the Bankruptcy Court of an order approving the GE Vernova Transaction, (ii) termination of the ECP Purchase Agreement, and (iii) conditions with respect to the accuracy of representations and warranties and compliance with covenants to be set forth in the Back-Up Bidder Documentation. If the ECP Purchase Agreement is terminated and the GE Vernova Transaction is not consummated prior to August 31, 2026, GE Vernova is obligated to purchase the certain obligations of the DIP Lenders under the DIP Credit Agreement from the DIP Lenders. Refer to Note 24 – Subsequent Events for further information regarding the GE Vernova Transaction.
Going Concern
Overall, the various economic challenges presented in the markets where we operate, as discussed above, continue to create uncertainty in the industry’s near-term outlook and continue to challenge our operations. Based on our evaluation of our current forecast and liquidity assessment, we have concluded that these factors raise substantial doubt about the Company’s ability to continue as a going concern. On August 11, 2025, the Company filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code in the Bankruptcy Court, which is an event of default that accelerated our debt obligations. While the Company is actively undergoing a restructuring, there can be no assurance that such restructuring will be successfully implemented or that it will be sufficient to mitigate the financial conditions raising substantial doubt about our ability to continue as a going concern. As a result, substantial doubt exists that the Company will be able to continue as a going concern for a period of at least twelve months from the issuance date of this Annual Report on Form 10-K. The consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty.
38
COMPONENTS OF RESULTS OF OPERATIONS
Net Sales
We recognize revenue from the majority of our manufacturing services over time as our customers control the product as it is produced, and we may not use or sell the product to fulfill other customers’ contracts. Net sales include amounts billed to our customers for our products as well as the progress towards the completion of the performance obligation for products in progress, which is determined on a ratio of direct costs incurred to date in fulfillment of the contract to the total estimated direct costs required to complete the performance obligation.
Cost of Goods Sold
Cost of goods sold includes the costs we incur at our production facilities to make products saleable on both products invoiced during the period as well as products in progress towards the satisfaction of the related performance obligations for which we have an enforceable right to payment upon termination and we may not use or sell the product to fulfill other customers’ contracts. All costs incurred at our production facilities, as well as the allocated portion to our production facilities of costs incurred at our corporate headquarters and our research facilities, are directly or indirectly related to the manufacturing of products or services and are presented in cost of goods sold. Cost of goods sold includes such items as raw materials, direct and indirect labor and facilities costs, including purchasing and receiving costs, plant management, inspection costs, production process improvement activities, product engineering and internal transfer costs. In addition, all depreciation associated with assets used in the production of our products is also included in cost of goods sold. Direct labor costs consist of salaries, benefits and other personnel related costs for associates engaged in the manufacturing of our products and services. All direct labor costs, excluding non-productive labor costs, are included in the measure of progress towards completion of the relevant performance obligation when determining revenue to be recognized during the period.
Startup and transition costs are primarily unallocated fixed overhead costs and underutilized direct labor costs incurred during the period production facilities are transitioning wind blade models and ramping up manufacturing. The cost of sales for the initial products from a new model manufacturing line is generally higher than when the line is operating at optimal production volume levels due to inefficiencies during ramp-up related to labor hours per blade, cycle times per blade and raw material usage. Additionally, these costs as a percentage of net sales are generally higher during the period in which a facility is ramping up to full production capacity due to underutilization of the facility. Manufacturing overhead at each of our facilities includes virtually all indirect costs (including share-based compensation costs) incurred at the plants, including engineering, finance, information technology, human resources and plant management.
General and Administrative Expenses
General and administrative expenses primarily relate to the unallocated portion of costs incurred at our corporate headquarters and our research facilities and include salaries, benefits and other personnel related costs for associates engaged in research and development, engineering, finance, internal audit, information technology, human resources, business development, global operational excellence, global supply chain, in-house legal and executive management. Other costs include outside legal and accounting fees, risk management (insurance), share-based compensation and certain other administrative and global resources costs.
The unallocated research and development expenses incurred at our Kolding, Denmark advanced engineering center and our Berlin, Germany engineering center are also included in general and administrative expenses. For the years ended December 31, 2025, 2024 and 2023, research and development expenses totaled $1.6 million, $1.3 million and $1.4 million, respectively.
Loss on Sale of Assets and Asset Impairments
Loss on sale of assets represents the losses on the sale of certain receivables, on a non-recourse basis under accounts receivable assignment agreements with our customers, to financial institutions and losses on the sale of other assets at our corporate and manufacturing facilities. Asset impairments represent the losses on the impairment of our assets at our corporate and manufacturing facilities.
39
Gain on extinguishment of Series A Preferred Stock
Gain on extinguishment of Series A Preferred Stock, par value $0.01 per share (the Series A Preferred Stock), represents the gain recognized as a result of the cashless exchange of all of the outstanding Series A Preferred Stock for the senior secured term loan (the Term Loan) under the Credit Agreement that we entered into in December 2023. See Note 14 – Debt for further discussion of the gain recognized.
Restructuring Charges, net
Restructuring charges, net primarily consist of associate severance, one-time termination benefits and ongoing benefits related to the reduction of our workforce and other costs associated with exit activities, which may include costs related to leased facilities to be abandoned and facility and associate relocation costs. For the year ended December 31, 2025, restructuring charges, net also includes approximately $23.2 million of professional fees related to our debt restructuring efforts prior to the filing of the Chapter 11 Cases (the “pre-petition professional fees”).
Other Income (Expense)
Other income (expense) consists of interest expense on our debt borrowings, the amortization of deferred financing costs on such borrowings, the amortization of the debt discount on our Term Loan, foreign currency income and losses, interest income on money market accounts, losses on extinguishment of debt and miscellaneous income and expense.
Reorganization items, net
Reorganization items, net consists of costs associated with the Chapter 11 Cases, primarily related to professional fees. For the year ended December 31, 2025, we incurred approximately $54.5 million of post-petition professional fees, $3.9 million of employee retention costs, $2.5 million of interest expense related to the write-off of debt issuance costs and $0.3 million of other bankruptcy-related costs, offset by $11.6 million of gains on adjustments to liabilities subject to compromise.
Income Taxes
Income taxes consists of federal, state, provincial, local and foreign taxes based on income in jurisdictions in which we operate, including in the U.S., Mexico, India and various countries within Europe. The income tax rate, tax provisions, deferred tax assets and liabilities vary according to the jurisdiction in which the income or loss arises. Tax laws are complex and subject to different interpretations by management and the respective governmental taxing authorities and require us to exercise judgment in determining our income tax provision, our deferred tax assets and liabilities and the valuation allowance recorded against our net deferred tax assets.
KEY METRICS USED BY MANAGEMENT TO MEASURE PERFORMANCE
In addition to measures of financial performance presented in our consolidated financial statements in accordance with GAAP, we use certain other financial measures and operating metrics to analyze our performance. These “non-GAAP” financial measures consist of EBITDA, adjusted EBITDA, free cash flow and net cash (debt), which help us evaluate growth trends, establish budgets, assess operational efficiencies, oversee our overall liquidity, and evaluate our overall financial performance. The key operating metrics consist of wind blade sets produced, estimated megawatts of energy capacity to be generated by wind blade sets produced, utilization, dedicated manufacturing lines, manufacturing lines installed, and weighted-average sales price (ASP) per wind blade, all of which help us evaluate our operational performance. We believe that these measures are useful to investors in evaluating our performance.
40
Key Financial Measures
The following discussion reflects continuing operations only, unless otherwise indicated. Certain prior period amounts have been reclassified to conform to the current period's presentation.
The key financial measures as of and for the years ended December 31 are as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Net sales |
|
$ |
918,457 |
|
|
$ |
889,991 |
|
|
$ |
863,919 |
|
Net loss from continuing operations |
|
|
(324,353 |
) |
|
|
(222,755 |
) |
|
|
(189,329 |
) |
EBITDA(1) |
|
|
(209,938 |
) |
|
|
(108,210 |
) |
|
|
(145,424 |
) |
Adjusted EBITDA(1) |
|
|
(112,263 |
) |
|
|
(84,996 |
) |
|
|
(120,980 |
) |
Net cash provided by (used in) operating activities |
|
|
(126,412 |
) |
|
|
12,498 |
|
|
|
(80,972 |
) |
Capital expenditures(2) |
|
|
14,531 |
|
|
|
26,201 |
|
|
|
36,137 |
|
Free cash flow(1)(2) |
|
|
(140,943 |
) |
|
|
(13,703 |
) |
|
|
(117,109 |
) |
Total debt, net of debt issuance costs |
|
|
456,053 |
|
|
|
500,990 |
|
|
|
421,680 |
|
Net cash (debt)(1) |
|
|
(441,637 |
) |
|
|
(302,970 |
) |
|
|
(259,705 |
) |
EBITDA and adjusted EBITDA
We define EBITDA, a non-GAAP financial measure, as net income or loss from continuing operations plus interest expense, income taxes and depreciation and amortization. We define adjusted EBITDA as EBITDA plus any share-based compensation expense, plus or minus any foreign currency losses or income, plus or minus any losses or gains from the sale of assets and asset impairments, plus any restructuring charges, plus any reorganization items. Adjusted EBITDA is the primary metric used by our management and our board of directors to establish budgets and operational goals for managing our business and evaluating our performance. We monitor adjusted EBITDA as a supplement to our GAAP measures, and believe it is useful to present to investors, because we believe that it facilitates evaluation of our period-to-period operating performance by eliminating items that are not operational in nature, allowing comparison of our recurring core business operating results over multiple periods unaffected by differences in capital structure, capital investment cycles and fixed asset base. In addition, we believe adjusted EBITDA and similar measures are widely used by investors, securities analysts, ratings agencies, and other parties in evaluating companies in our industry as a measure of financial performance and debt-service capabilities.
Our use of adjusted EBITDA has limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
41
In evaluating EBITDA and adjusted EBITDA, you should be aware that in the future, we will incur expenses similar to the adjustments noted herein. Our presentations of EBITDA and adjusted EBITDA should not be construed as suggesting that our future results will be unaffected by these expenses or any unusual or non-recurring items. When evaluating our performance, you should consider EBITDA and adjusted EBITDA alongside other financial performance measures, including our net income (loss) and other GAAP measures.
Free cash flow
We define free cash flow as net cash provided by (used in) operating activities less capital expenditures. We believe free cash flow is a useful measure for investors because it portrays our ability to generate cash from our business for purposes such as repaying maturing debt and accrued interest paid in kind on debt and funding business acquisitions.
Net cash (debt)
We define net cash (debt) as total unrestricted cash and cash equivalents less the total amount of debt outstanding. The total amount of debt outstanding is comprised of the long-term debt and current maturities of long-term debt, net of debt issuance costs and debt discounts, as presented in our consolidated balance sheets. We believe that the presentation of net cash (debt) provides useful information to investors because our management reviews net cash (debt) as part of our oversight of overall liquidity, financial flexibility and leverage. Net cash (debt) is important when we consider opening new manufacturing facilities and expanding existing manufacturing facilities, as well as for capital expenditure requirements.
The following tables reconcile our non-GAAP key financial measures to the most directly comparable GAAP measures:
42
EBITDA and adjusted EBITDA for the years ended December 31 are reconciled as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Net loss attributable to common stockholders |
|
$ |
(340,802 |
) |
|
$ |
(240,707 |
) |
|
$ |
(177,612 |
) |
Net loss (income) from discontinued operations |
|
|
16,449 |
|
|
|
17,952 |
|
|
|
12,450 |
|
Net loss from continuing operations attributable |
|
|
(324,353 |
) |
|
|
(222,755 |
) |
|
|
(165,162 |
) |
Preferred stock dividends and accretion |
|
|
— |
|
|
|
— |
|
|
|
58,453 |
|
Gain on extinguishment of |
|
|
— |
|
|
|
— |
|
|
|
(82,620 |
) |
Net loss from continuing operations |
|
|
(324,353 |
) |
|
|
(222,755 |
) |
|
|
(189,329 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
21,694 |
|
|
|
22,114 |
|
|
|
26,268 |
|
Interest expense, net |
|
|
88,990 |
|
|
|
84,720 |
|
|
|
6,526 |
|
Income tax provision |
|
|
3,731 |
|
|
|
7,711 |
|
|
|
11,111 |
|
EBITDA |
|
|
(209,938 |
) |
|
|
(108,210 |
) |
|
|
(145,424 |
) |
Share-based compensation expense |
|
|
2,432 |
|
|
|
6,193 |
|
|
|
8,738 |
|
Foreign currency loss (income), net |
|
|
5,310 |
|
|
|
617 |
|
|
|
293 |
|
Loss on sale of assets and asset impairments |
|
|
14,757 |
|
|
|
15,085 |
|
|
|
15,373 |
|
Restructuring charges, net |
|
|
25,585 |
|
|
|
1,319 |
|
|
|
40 |
|
Reorganization items, net |
|
|
49,591 |
|
|
|
— |
|
|
|
— |
|
Adjusted EBITDA |
|
$ |
(112,263 |
) |
|
$ |
(84,996 |
) |
|
$ |
(120,980 |
) |
Free cash flow, which includes discontinued operations, for the years ended December 31 is reconciled as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Net cash provided by (used in) operating activities |
|
$ |
(126,412 |
) |
|
$ |
12,498 |
|
|
$ |
(80,972 |
) |
Less capital expenditures |
|
|
(14,531 |
) |
|
|
(26,201 |
) |
|
|
(36,137 |
) |
Free cash flow |
|
$ |
(140,943 |
) |
|
$ |
(13,703 |
) |
|
$ |
(117,109 |
) |
Net cash (debt) as of December 31 is reconciled as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Cash and cash equivalents |
|
$ |
13,899 |
|
|
$ |
143,300 |
|
|
$ |
119,894 |
|
Cash and cash equivalents of |
|
|
517 |
|
|
|
54,720 |
|
|
|
42,081 |
|
Total debt, net of debt issuance costs |
|
|
(456,053 |
) |
|
|
(500,990 |
) |
|
|
(421,680 |
) |
Net cash (debt) |
|
$ |
(441,637 |
) |
|
$ |
(302,970 |
) |
|
$ |
(259,705 |
) |
43
Key Operating Metrics (1)
The key operating metrics as of and for the year ended December 31 are as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Sets |
|
|
1,615 |
|
|
|
1,406 |
|
|
|
1,568 |
|
Estimated megawatts |
|
|
5,528 |
|
|
|
5,688 |
|
|
|
6,611 |
|
Utilization |
|
|
76 |
% |
|
|
73 |
% |
|
|
75 |
% |
Dedicated manufacturing lines |
|
|
26 |
|
|
|
24 |
|
|
|
26 |
|
Manufacturing lines installed |
|
|
26 |
|
|
|
24 |
|
|
|
26 |
|
Wind blade ASP (in $ thousands) |
|
$ |
177 |
|
|
$ |
197 |
|
|
$ |
170 |
|
Sets represents the number of wind blade sets, consisting of three wind blades each, which we produced worldwide during the period. We monitor sets and believe that presenting sets to investors is helpful because we believe that it is the most direct measurement of our manufacturing output during the period. Sets primarily impact net sales.
Estimated megawatts are the energy capacity to be generated by wind blade sets produced during the period. Our estimate is based solely on name-plate capacity of the wind turbine on which the wind blades we manufacture are expected to be installed. We monitor estimated megawatts and believe that presenting estimated megawatts to investors is helpful because we believe that it is a commonly followed measurement of energy capacity across our industry and provides an indication of our share of the overall wind blade market.
Utilization represents the percentage of the number of wind blades produced during the period compared to the total potential wind blade capacity of the manufacturing lines installed during the period. We monitor utilization because we believe it helps investors to better understand how close we are to operating at maximum production capacity.
Dedicated manufacturing lines are the number of wind blade manufacturing lines that we have dedicated to our customers pursuant to our supply agreements at the end of the period. We monitor dedicated manufacturing lines and believe that presenting this metric to investors is helpful because we believe that the number of dedicated manufacturing lines is the best indicator of demand for the wind blades we manufacture for customers under our supply agreements in any given period. Lines become dedicated upon the execution of a supply agreement; this means that lines are typically dedicated before they are installed.
Manufacturing lines installed represents the number of wind blade manufacturing lines installed and either in operation, startup or transition during the period. We believe that total manufacturing lines installed provides an understanding of the number of manufacturing lines installed and either in operation, startup or transition. From time to time, we have manufacturing lines installed that are not dedicated to our customers pursuant to a supply agreement.
Wind blade ASP represents the average sales price (ASP) during the period for a single wind blade that we manufacture for our customers. We monitor wind blade ASP and believe that presenting it to investors is helpful as it is the most direct measurement of our pricing structure with our customers under our supply agreements and directly impacts net sales.
44
RESULTS OF OPERATIONS
Year Ended December 31, 2025 Compared to Year Ended December 31, 2024
The following table summarizes certain of our operating results as a percentage of net sales for the years ended December 31 that have been derived from our consolidated statements of operations:
|
|
2025 |
|
|
2024 |
|
||
Net sales |
|
|
100.0 |
% |
|
|
100.0 |
% |
Cost of sales |
|
|
109.4 |
|
|
|
103.4 |
|
Startup and transition costs |
|
|
2.6 |
|
|
|
4.7 |
|
Total cost of goods sold |
|
|
112.0 |
|
|
|
108.1 |
|
Gross loss |
|
|
(12.0 |
) |
|
|
(8.1 |
) |
General and administrative expenses |
|
|
3.1 |
|
|
|
5.2 |
|
Loss on sale of assets and asset impairments |
|
|
1.6 |
|
|
|
1.7 |
|
Restructuring charges, net |
|
|
2.8 |
|
|
|
0.1 |
|
Loss from continuing operations |
|
|
(19.5 |
) |
|
|
(15.1 |
) |
Total other expense |
|
|
(10.0 |
) |
|
|
(9.1 |
) |
Loss before income taxes |
|
|
(29.5 |
) |
|
|
(24.2 |
) |
Reorganization items, net |
|
|
(5.4 |
) |
|
|
0.0 |
|
Income tax provision |
|
|
(0.4 |
) |
|
|
(0.8 |
) |
Net loss from continuing operations |
|
|
(35.3 |
) |
|
|
(25.0 |
) |
Net loss from discontinued operations |
|
|
(1.8 |
) |
|
|
(2.0 |
) |
Net loss attributable to common stockholders |
|
|
(37.1 |
)% |
|
|
(27.0 |
)% |
Net sales
Consolidated discussion
The following table summarizes our net sales by product/service for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Wind blade, tooling |
|
$ |
869,921 |
|
|
$ |
860,222 |
|
|
$ |
9,699 |
|
|
|
1.1 |
% |
Field service, inspection |
|
|
48,536 |
|
|
|
29,769 |
|
|
|
18,767 |
|
|
|
63.0 |
|
Total net sales |
|
$ |
918,457 |
|
|
$ |
889,991 |
|
|
$ |
28,466 |
|
|
|
3.2 |
% |
The increase in wind blade, tooling, and other wind-related (collectively, Wind) sales for the year ended December 31, 2025, as compared to the same period in 2024,was primarily due to a 15% increase in the number of wind blades produced, partially offset by liquidated damages as a result of certain production challenges at our Mexico facilities and lower average sales prices of wind blades due to changes in the mix of wind blade models produced. The change in volume was primarily due to the restart and production ramp for two of our previously idled facilities, offset by a temporary production stoppage due to a safety stand-down in our Mexico manufacturing facilities in the second quarter of 2025 and temporary production stoppages subsequent to the Petition Date due to supply chain challenges as a result of the Chapter 11 Cases.
The increase in field service, inspection and repair services (collectively, Field Services) sales for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to an increase in technicians deployed to revenue generating projects due to a decrease in time spent on non-revenue generating warranty campaigns.
45
Segment discussion
The following table summarizes our net sales by our three geographic operating segments for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
U.S. |
|
$ |
65,775 |
|
|
$ |
19,723 |
|
|
$ |
46,052 |
|
|
NM |
|
|
Mexico |
|
|
716,818 |
|
|
|
696,762 |
|
|
|
20,056 |
|
|
|
2.9 |
|
India |
|
|
129,173 |
|
|
|
166,765 |
|
|
|
(37,592 |
) |
|
|
(22.5 |
) |
Other |
|
|
6,691 |
|
|
|
6,741 |
|
|
|
(50 |
) |
|
|
(0.7 |
) |
Total net sales |
|
$ |
918,457 |
|
|
$ |
889,991 |
|
|
$ |
28,466 |
|
|
|
3.2 |
% |
U.S. Segment
The following table summarizes our net sales by product/service for the U.S. segment for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Wind blade, tooling |
|
$ |
28,219 |
|
|
$ |
— |
|
|
$ |
28,219 |
|
|
NM |
|
|
Field service, inspection |
|
|
37,556 |
|
|
|
19,723 |
|
|
|
17,833 |
|
|
|
90.4 |
|
Total net sales |
|
$ |
65,775 |
|
|
$ |
19,723 |
|
|
$ |
46,052 |
|
|
NM |
|
|
NM - not meaningful.
The increase in our U.S. segment's Wind sales for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to the restart of production at our Iowa manufacturing facility.
The increase in Field Services sales for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to an increase in technicians deployed to revenue generating projects due to a decrease in time spent on non-revenue generating warranty campaigns.
Mexico Segment
The following table summarizes our net sales by product/service for the Mexico segment for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Wind blade, tooling |
|
$ |
712,518 |
|
|
$ |
693,939 |
|
|
$ |
18,579 |
|
|
|
2.7 |
% |
Field service, inspection |
|
|
4,300 |
|
|
|
2,823 |
|
|
|
1,477 |
|
|
|
52.3 |
|
Total net sales |
|
$ |
716,818 |
|
|
$ |
696,762 |
|
|
$ |
20,056 |
|
|
|
2.9 |
% |
46
The increase in the Mexico segment’s Wind sales for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to a 18% net increase in the number of wind blades produced across our Mexico manufacturing facilities due primarily due to the restart and ramp of production of a previously idled facility in Juarez, Mexico, as well as higher utilization as certain of our manufacturing lines in Mexico were in serial production in the current periods, that were in transition during the prior comparative period. This increase in volume was partially offset by liquidated damages as a result of certain production challenges, temporary production stoppages subsequent to the Petition Date due to supply chain challenges as a result of the Chapter 11 Cases, lower average sales prices of wind blades due to changes in the mix of wind blades produced, a temporary production stoppage from a safety stand-down in the second quarter, and a decrease in the number of wind blades produced at the Nordex Matamoros facility that shut down at the conclusion of the contract on June 30, 2024.
The increase in our Mexico segment's Field Services sales for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to an increase in technicians deployed to revenue generating projects due to a decrease in time spent on non-revenue generating warranty campaigns.
India Segment
The following table summarizes our net sales by product/service for the India segment for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Wind blade, tooling |
|
$ |
128,170 |
|
|
$ |
166,283 |
|
|
$ |
(38,113 |
) |
|
|
(22.9 |
)% |
Field service, inspection |
|
|
1,003 |
|
|
|
482 |
|
|
|
521 |
|
|
|
108.1 |
|
Total net sales |
|
$ |
129,173 |
|
|
$ |
166,765 |
|
|
$ |
(37,592 |
) |
|
|
(22.5 |
)% |
The decrease in the India segment’s net sales of Wind for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to lower average sales prices of wind blades due to changes in the mix of wind blade models produced and a decrease of 8% in the number of wind blades produced.
Other
The following table summarizes our net sales by product/service for the all other operations for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Wind blade, tooling |
|
$ |
1,014 |
|
|
$ |
— |
|
|
$ |
1,014 |
|
|
NM |
|
|
Field service, inspection |
|
|
5,677 |
|
|
|
6,741 |
|
|
|
(1,064 |
) |
|
|
(15.8 |
) |
Total net sales |
|
$ |
6,691 |
|
|
$ |
6,741 |
|
|
$ |
(50 |
) |
|
|
(0.7 |
)% |
47
Total cost of goods sold
The following table summarizes our total cost of goods sold for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Cost of sales |
|
$ |
1,004,904 |
|
|
$ |
920,445 |
|
|
$ |
84,459 |
|
|
|
9.2 |
% |
Startup costs |
|
|
14,333 |
|
|
|
18,277 |
|
|
|
(3,944 |
) |
|
|
(21.6 |
) |
Transition costs |
|
|
9,819 |
|
|
|
23,459 |
|
|
|
(13,640 |
) |
|
|
(58.1 |
) |
Total cost of goods sold |
|
$ |
1,029,056 |
|
|
$ |
962,181 |
|
|
$ |
66,875 |
|
|
|
7.0 |
|
% of net sales |
|
|
112.0 |
% |
|
|
108.1 |
% |
|
|
|
|
|
3.6 |
% |
|
Total cost of goods sold as a percentage of net sales increased by approximately 3.6% for the year ended December 31, 2025, as compared to the same period in 2024, primarily due to liquidated damages and increased labor costs as a result of production challenges, a temporary production stoppage from a safety stand-down in the second quarter of 2025, and temporary production stoppages subsequent to the Petition Date due to supply chain challenges as a result of the Chapter 11 Cases. This increase was partially offset by lower startup and transition costs and the shutdown of our Nordex Matamoros facility at the end of the second quarter of 2024, which had significant cost challenges in the prior comparative period. The fluctuating U.S. dollar against the Mexican Peso and Indian Rupee had a combined unfavorable impact of 1.8% on consolidated cost of goods sold for the year ended December 31, 2025, as compared to the same period in 2024.
General and administrative expenses
The following table summarizes our general and administrative expenses for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
General and |
|
$ |
28,431 |
|
|
$ |
46,174 |
|
|
$ |
(17,743 |
) |
|
|
(38.4 |
)% |
% of net sales |
|
|
3.1 |
% |
|
|
5.2 |
% |
|
|
|
|
|
(2.1 |
)% |
|
General and administrative expenses decreased by approximately 2.1% as a percentage of net sales for the year ended December 31, 2025, as compared to the same period in 2024. General and administrative expenses for the years ended December 31, 2025 and 2024 include approximately $8.7 million and $18.7 million, respectively, of unallocated corporate overhead costs that were previously allocated to our discontinued operations in Türkiye but have been reclassified to continuing operations to conform to the current period’s presentation. The remaining improvement in general and administrative expenses for the year ended December 31, 2025 as compared to the same period in 2024 is primarily due to lower employee compensation costs and lower professional service and consulting fees unrelated to our capital restructuring activities, partially offset by increased network and telecommunication costs associated with the implementation of our advanced technology processes in the first half of 2025.
48
Loss on sale of assets and asset impairments
The following table summarizes our loss on sale of assets and asset impairments for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Loss on sale of receivables |
|
$ |
14,219 |
|
|
$ |
10,708 |
|
|
$ |
3,511 |
|
|
|
32.8 |
% |
Loss on sale of other assets |
|
|
538 |
|
|
|
4,377 |
|
|
|
(3,839 |
) |
|
|
(87.7 |
) |
Total loss on sale of assets |
|
$ |
14,757 |
|
|
$ |
15,085 |
|
|
$ |
(328 |
) |
|
|
(2.2 |
) |
% of net sales |
|
|
1.6 |
% |
|
|
1.7 |
% |
|
|
|
|
|
(0.1 |
)% |
|
Losses on sales of receivables for the year ended December 31, 2025 compared to the same period in 2024, increased by approximately $3.5 million primarily due to an increase in the volume of receivables sold through our accounts receivable financing arrangements with certain of our customers. Losses on sales of other assets and asset impairments for the year ended December 31, 2025, as compared to the same period in 2024, decreased primarily due to approximately $3.4 million of asset impairments associated with our tooling business Mexico in the prior comparative period. We completed the divestiture of our tooling business in August 2025.
Restructuring charges, net
The following table summarizes our restructuring charges, net, for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Severance |
|
$ |
2,341 |
|
|
$ |
1,319 |
|
|
$ |
1,022 |
|
|
|
77.5 |
% |
Other restructuring costs |
|
|
23,244 |
|
|
|
— |
|
|
|
23,244 |
|
|
NM |
|
|
Total restructuring charges, net |
|
$ |
25,585 |
|
|
$ |
1,319 |
|
|
$ |
24,266 |
|
|
|
1,839.7 |
|
% of net sales |
|
|
2.8 |
% |
|
|
0.1 |
% |
|
|
|
|
|
2.7 |
% |
|
The increase in restructuring charges, net for the year ended December 31, 2025, as compared to the same period in 2024 was primarily due to $23.2 million of pre-petition professional fees related to our capital restructuring activities prior to the filing of the Chapter 11 Cases, as well as an increase in termination benefits associated with a reduction in workforce at our India facility at the conclusion of our supply agreement with one of our customers.
Income (loss) from continuing operations
Segment discussion
The following table summarizes our income (loss) from operations by our three geographic operating segments for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
U.S. |
|
$ |
(64,137 |
) |
|
$ |
(43,561 |
) |
|
$ |
(20,576 |
) |
|
|
(47.2 |
)% |
Mexico |
|
|
(115,339 |
) |
|
|
(96,214 |
) |
|
|
(19,125 |
) |
|
|
(19.9 |
) |
India |
|
|
(114 |
) |
|
|
5,920 |
|
|
|
(6,034 |
) |
|
|
(101.9 |
) |
Other |
|
|
218 |
|
|
|
(913 |
) |
|
|
1,131 |
|
|
|
123.9 |
|
Total loss from |
|
$ |
(179,372 |
) |
|
$ |
(134,768 |
) |
|
$ |
(44,604 |
) |
|
|
(33.1 |
)% |
% of net sales |
|
|
-19.5 |
% |
|
|
-15.1 |
% |
|
|
|
|
|
(4.4 |
)% |
|
49
U.S. Segment
The increase in the loss from operations in the U.S. segment for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to increased pre-petition professional fees associated with our capital restructuring activities, start-up costs at our previously idled Iowa facility, offset by increased field services sales and lower general and administrative expenses due to lower employee compensation costs.
Mexico Segment
The increase in loss from operations in the Mexico segment for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to liquidated damages and increased labor costs as a result of certain production challenges, temporary production stoppages subsequent to the Petition Date due to supply chain challenges as a result of the Chapter 11 Cases, and the impacts of a temporary production stoppage from a safety stand-down in the second quarter of 2025. These negative impacts were partially offset by the shutdown of our Nordex Matamoros facility at the end of the second quarter of 2024, which had significant cost challenges in the prior comparative period, a decrease in startup and transition costs, an increase in the number of wind blades produced due to the restart and ramp of production at one of our previously idled facilities in Juarez, Mexico, and changes in foreign currency fluctuations. The fluctuating U.S. dollar relative to the Mexican Peso had an unfavorable impact of 1.6% on the Mexico segment's cost of goods sold for the year ended December 31, 2025, as compared to the same period in 2024.
India Segment
The decrease in income from operations in the India segment for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to lower average sales prices of wind blades, decreases in the number of wind blades produced, and an increase in startup and transition costs in the first quarter of 2025.
Other income (expense)
The following table summarizes our total other income (expense) for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Interest expense, net |
|
$ |
(88,990 |
) |
|
$ |
(84,720 |
) |
|
$ |
(4,270 |
) |
|
|
(5.0 |
)% |
Foreign currency |
|
|
(5,310 |
) |
|
|
(617 |
) |
|
|
(4,693 |
) |
|
|
(760.6 |
) |
Miscellaneous income |
|
|
2,641 |
|
|
|
5,061 |
|
|
|
(2,420 |
) |
|
|
(47.8 |
) |
Total other expense |
|
$ |
(91,659 |
) |
|
$ |
(80,276 |
) |
|
$ |
(11,383 |
) |
|
|
(14.2 |
)% |
The increase in total other expense for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to an increase in interest expense and non-cash amortization of debt discounts related to our Senior Secured Term Loan, as well as unfavorable foreign currency exchange rates.
Reorganization items, net
The following table summarizes our reorganization items, net for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|||
|
|
(in thousands) |
|
|
|
|||||||||
Reorganization items, net |
|
$ |
49,591 |
|
|
$ |
— |
|
|
$ |
49,591 |
|
|
NM |
50
The increase in reorganization items, net for the year ended December 31, 2025, as compared to the same period in 2024, was due to costs associated with the Chapter 11 Cases, including $54.5 million of post-petition professional fees, $3.9 million of employee retention costs, $2.5 million of interest expense related to the write-off of debt issuance costs and $0.3 million of other bankruptcy-related costs, offset by $11.6 million of gains on adjustments to liabilities subject to compromise.
Income taxes
The following table summarizes our income taxes for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Income tax provision |
|
$ |
(3,731 |
) |
|
$ |
(7,711 |
) |
|
$ |
3,980 |
|
|
|
51.6 |
% |
Effective tax rate |
|
|
1.2 |
% |
|
|
3.6 |
% |
|
|
|
|
|
|
||
Our income tax provision for the year ended December 31, 2025, as compared to the same period in 2024 decreased due to the mix of earnings of our operations in foreign jurisdictions and changes in our uncertain tax positions.
Net loss from continuing operations
The following table summarizes our net loss from continuing operations for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Net loss from |
|
$ |
(324,353 |
) |
|
$ |
(222,755 |
) |
|
$ |
(101,598 |
) |
|
|
(45.6 |
)% |
The increase in the net loss for the year ended December 31, 2025 as compared to the same period in 2024, was primarily due to pre-petition and post-petition professional fees associated with our capital restructuring activities, as well as liquidated damages and higher labor costs due to production challenges. These negative impacts were partially offset by the shutdown of our Nordex Matamoros facility at the end of the second quarter of 2024, which had significant cost challenges in the prior comparative period, and an overall increase in the number of wind blades produced compared to the prior period.
Net loss from discontinued operations
The following table summarizes our net loss from discontinued operations for the years ended December 31:
|
|
|
|
|
|
|
|
Change |
|
|||||||
|
|
2025 |
|
|
2024 |
|
|
$ |
|
|
% |
|
||||
|
|
(in thousands) |
|
|
|
|
||||||||||
Net loss from |
|
$ |
(16,449 |
) |
|
$ |
(17,952 |
) |
|
$ |
1,503 |
|
|
|
8.4 |
% |
The net loss from discontinued operations for the year ended December 31, 2025, as compared to the same period in 2024, was primarily due to the impacts of the divestiture of our Automotive business on June 30, 2024 in the prior comparative period and the divestiture of our Turkish operations.
Year Ended December 31, 2024 Compared to Year Ended December 31, 2023
For a comparison of our results of operations for the years ended December 31, 2024 and 2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations” included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 20, 2025 and incorporated herein by reference.
51
LIQUIDITY AND CAPITAL RESOURCES
Our primary needs for liquidity have been, and in the future will continue to be, capital expenditures, purchases of raw materials, the impact of startups and transitions, working capital, debt service costs, warranty costs, and reorganization costs associated with our Chapter 11 Cases. Our capital expenditures have been primarily related to machinery and equipment for new facilities or facility expansions. Historically, we have funded our working capital needs through cash flows from operations, the proceeds received from our credit facilities and from proceeds received from the issuance of stock.
In connection with the filing of the Chapter 11 Cases, the Debtors entered into a DIP Credit Agreement, pursuant to which, the DIP Lenders agreed to provide the Company with a multiple draw term loan facility in an aggregate principal amount not to exceed $82.5 million (the “DIP Facility”). On August 14, 2025, the Company received $7.5 million in DIP Tranche 1 borrowings under the DIP Facility, which was used (i) to pay amounts, fees, costs and expenses related to the Chapter 11 Cases and (ii) for working capital and general corporate purposes. Concurrently with the funding of the DIP Tranche 1, the DIP Lenders rolled up their ratable share of Senior Secured Term Loan obligations in an amount equal to two times the amount of new money borrowed under such DIP Tranche 1, or $15.0 million (the “Initial Roll-Up Loan”). As of December 31, 2025, the Company had outstanding borrowings of $23.9 million under the DIP Facility, consisting of $7.5 million of DIP Tranche 1 borrowings, $15.0 million of Initial Roll-Up Loans, $0.2 million of commitment fees, and $1.2 million of paid in kind interest.
On March 1, 2026, the Company received a letter from the DIP Lenders regarding an Event of Default occurring under the DIP Credit Agreement. The letter notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
CBP is currently reviewing certain of the wind blade models that are manufactured at our facilities in Mexico pursuant to the Uyghur Forced Labor Prevention Act (“UFLPA”). As a result of these reviews, CBP has restricted the importation of these wind blades into the U.S. while the matter remains under investigation. Although we are confident that our wind blade supply chain does not source materials from the Xinjiang Uyghur Autonomous Region of China, the UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by certain identified entities, are made with forced labor and are therefore prohibited from entry into the U.S. unless the importer can demonstrate otherwise to the satisfaction of CBP.
Because of the current CBP actions, a substantial portion of the wind blades manufactured at our Mexico facilities are unable to be imported into the U.S. market. The inability to import these wind blades has significantly disrupted, and may continue to disrupt, our supply chain, reduce available inventory for U.S. customers, delay deliveries, and result in lost sales. In addition, these CBP reviews have required and may continue to require significant management attention, internal resources, and legal and compliance costs as we work to respond to CBP’s inquiries and further demonstrate compliance with applicable laws.
The outcome and duration of the CBP reviews are uncertain. If we are unable to satisfactorily resolve the matter, CBP may continue to detain, exclude, or seize affected wind blades, which could further restrict our ability to serve customers in the U.S. and may require us to modify our sourcing, manufacturing, or supply chain practices. Any prolonged disruption in our ability to import wind blades into the U.S., or any adverse findings by CBP, will have a further, material adverse effect on our business, financial condition, and results of operations.
Our liquidity as of December 31, 2025 has been impacted by liquidated damages paid to our customers and lower than expected wind blade production volume at our Mexico manufacturing facilities due to a temporary production stoppage from a safety stand-down in the second quarter of 2025 and temporary production stoppages subsequent to the Petition Date due to supply chain challenges as a result of the Chapter 11 Cases. We have also
52
incurred significant professional fees and other costs in connection with our Chapter 11 Cases that have adversely impacted our liquidity.
Due to the liquidity challenges we have faced during the pendency of the Chapter 11 Cases, we have entered into various agreements with our customers, Vestas and GE Vernova, pursuant to which these customers have provided short-term liquidity needs through cash advances and accelerated payment terms, so that the Company could continue to operate while negotiating the terms of a potential plan of reorganization and pursue a parallel sale process. The cash advance payments have constituted an allowed administrative expense claim against the Debtors under section 503(b) of the Bankruptcy Code, and accordingly, we have recorded these advances as contract liabilities in our consolidated balance sheets. As of December 31, 2025, we had $25.0 million of contract liabilities outstanding related to cash received from our customers under these liquidity arrangements.
At December 31, 2025 and 2024, we had unrestricted cash and cash equivalents totaling $13.9 million and $143.3 million, respectively. The December 31, 2025 balance included $5.4 million of cash located outside of the U.S., $2.6 million in India, $1.2 million in Mexico and $1.6 million in other countries. The December 31, 2024 balance included $5.8 million of cash located outside of the U.S., $1.8 million in India, $2.3 million in Mexico and $1.7 million in other countries. In addition to these amounts, at December 31, 2025 and 2024, we had unrestricted cash and cash equivalents related to our discontinued operations of $0.5 million and $54.7 million, respectively, all located outside of the U.S.
We are not presently involved in any off-balance sheet arrangements, including transactions with unconsolidated special-purpose or other entities that would materially affect our financial position, results of operations, liquidity or capital resources, other than our accounts receivable assignment agreements described below. Furthermore, we do not have any relationships with special-purpose or other entities that provide off-balance sheet financing; liquidity, market risk or credit risk support; or engage in leasing or other services that may expose us to liability or risks of loss that are not reflected in the consolidated financial statements and related notes.
Our segments enter into accounts receivable assignment agreements with various financial institutions. Under these agreements, the financial institution buys, on a non-recourse basis, the accounts receivable amounts related to our segment’s customers at an agreed-upon discount rate.
The following table summarizes certain key details of our accounts receivable assignment agreements in place as of December 31, 2025:
Year Of Initial Agreement |
|
Segment(s) Related To |
|
Current Annual Interest Rate |
2019 |
|
Mexico |
|
SOFR plus 0.26% |
2020 |
|
India |
|
SOFR plus 0.26% |
2020 |
|
U.S. |
|
SOFR plus 0.29% |
2021 |
|
Mexico |
|
SOFR plus 0.29% |
As the receivables are purchased by the financial institutions under the agreements noted above, the receivables are removed from our consolidated balance sheet. During the years ended December 31, 2025 and 2024, $746.8 million and $474.1 million, respectively, of receivables were sold under the accounts receivable assignment agreements described above.
53
Cash Flow Discussion
The following table summarizes our key cash flow activity on a consolidated basis, and includes cash flows from continuing and discontinued operations, for the years ended December 31:
|
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
|
|
(in thousands) |
|
|||||||||
Net cash provided by (used in) operating activities |
|
$ |
(126,412 |
) |
|
$ |
12,498 |
|
|
$ |
(138,910 |
) |
Net cash used in investing activities |
|
|
(15,847 |
) |
|
|
(26,201 |
) |
|
|
10,354 |
|
Net cash provided by (used in) financing activities |
|
|
(44,453 |
) |
|
|
50,964 |
|
|
|
(95,417 |
) |
Impact of foreign exchange rates on cash, cash |
|
|
3,643 |
|
|
|
(2,415 |
) |
|
|
6,058 |
|
Net change in cash, cash equivalents |
|
$ |
(183,069 |
) |
|
$ |
34,846 |
|
|
$ |
(217,915 |
) |
Operating Cash Flows
Net cash used in operating activities increased by $138.9 million for the year ended December 31, 2025 as compared to the same period in 2024, primarily due to lower income from continuing operations due to the various production and liquidity challenges in Mexico mentioned above, and significant professional fees associated with our Chapter 11 Cases, including $23.2 million of pre-petition fees and $54.5 million of post-petition fees through December 31, 2025. Our operating cash flow was also impacted by the labor strike associated with our discontinued operations in Türkiye. This was partially offset by the shutdown of the Nordex Matamoros facility and divestiture of our Automotive business on June 30, 2024, which had significant losses from operations in the prior comparative period.
Investing Cash Flows
Net cash used in investing activities decreased by $10.4 million for the year ended December 31, 2025 as compared to the same period in 2024 primarily due to lower capital expenditures from fewer lines in startup and transition in the current year.
Financing Cash Flows
Net cash used in financing activities increased by $95.4 million for the year ended December 31, 2025 as compared to the same period in 2024, primarily due to our discontinued operations in Türkiye prior to the sale of such operations, including net repayments of $47.9 million of outstanding borrowings under our international credit facilities in the current period compared to net proceeds of $62.0 million under the same credit facilities in the prior period. Partially offsetting these net uses of cash from financing activities, the Company received $7.5 million in cash proceeds under its DIP Credit Agreement.
For a discussion and comparison of our cash flows for the years ended December 31, 2024 and 2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations” included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 20, 2025 incorporated herein by reference.
Our Indebtedness
For a discussion of our indebtedness, refer to Note 14 – Debt, of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
Other Contingencies
For a discussion of our legal proceedings, refer to Note 18 – Commitments and Contingencies – Legal Proceedings, of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
54
The wind blades and other composite structures that we produce are subject to warranties against defects in workmanship and materials, generally for a period of two to five years. We are not responsible for the fitness for use of the wind blade or the overall wind turbine system. If a wind blade is found to be defective during the warranty period as a result of a defect in workmanship or materials, among other potential remedies, we may need to repair or replace the wind blade (which could include significant transportation and installation costs) at our sole expense. At December 31, 2025 and 2024, we had accrued warranty reserves totaling $45.8 million and $38.8 million, respectively. At December 31, 2025, approximately $31.4 million of the accrued warranty reserve is classified as liabilities subject to compromise in our consolidated balance sheets.
As of December 31, 2025, we had no material operating expenditures for environmental matters, including government imposed remedial or corrective actions, during the year ended December 31, 2025.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amount of our assets, liabilities, revenue and expenses and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis, including those related to revenue recognition and warranty expense. We base our estimates on our historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making the judgments we make about the carrying values of our assets and liabilities that are not readily apparent from other sources. Because these estimates can vary depending on the situation, actual results may differ from the estimates.
We believe the following critical accounting policies affect our more significant judgments used in the preparation of our consolidated financial statements.
Revenue Recognition. The majority of our revenue is generated from supply agreements associated with manufacturing of wind blades and related services. We account for a supply agreement when it has the approval from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and the collectability of consideration is probable. Our manufacturing services are customer specific and involve production of items that cannot be sold to other customers due to the customers’ protected IP.
Revenue is primarily recognized over time as we have an enforceable right to payment upon termination and we may not use or sell the product to fulfill other customers’ supply agreements. Because control transfers over time, revenue is recognized based on the extent of progress towards the completion of the performance obligation under the cost-to-cost input measure of progress as this method provides the best representation of the production progress towards satisfaction of the performance obligation. Under the cost-to-cost method, progress and the related revenue recognition is determined by a ratio of direct costs incurred to date in fulfillment of the performance obligation to the total estimated direct costs required to complete the performance obligation.
Determining the revenue to be recognized for services performed under our supply agreements involves judgments and estimates relating to the total consideration to be received and the expected direct costs to complete the performance obligation. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information available to us at the time of the estimate and may materially change as additional information becomes known.
Under the cost-to-cost method, contract assets established primarily relate to our rights to consideration for work completed but not billed at the reporting date on our supply agreements. The contract assets are transferred to accounts receivable when the rights become unconditional, which generally occurs when customers are invoiced upon the determination that a product conforms to the contract specifications.
See Note 1 – Summary of Operations and Summary of Significant Accounting Policies – (f) Revenue Recognition of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form
55
10-K, for further discussion of our accounting policies related to revenue recognition, including accounting policies surrounding our non-manufacturing related services.
Warranty Expense. The wind blades we manufacture are subject to warranties against defects in workmanship and materials, generally for a period of two to five years. We are not responsible for the fitness for use of the wind blade in the overall wind turbine system. If a wind blade is found to be defective during the warranty period as a result of a defect in workmanship or materials, among other potential remedies, we may need to repair or replace the wind blade at our sole expense. We provide warranties for all of our products with terms and conditions that vary depending on the product sold. We may offer extended warranties to our customers in limited situations. We record warranty expense based upon our estimate of future repairs using a probability-based methodology that considers previous warranty claims, identified quality issues and industry practices. Once the warranty period has expired, any remaining unused warranty accrual for the specific products is reversed against the current year warranty expense amount, provided that the warranty accrual for other products whose warranty period has not yet expired is sufficient to cover the estimated cost of future repairs for those other products.
Our estimate of warranty expense requires us to make assumptions about matters that are highly uncertain, including future rates of product failure, repair costs, availability of materials, shipping and handling, and de-installation and re-installation costs at customers’ sites, among others. When a potential or actual warranty claim arises, we may accrue additional warranty reserves for the estimated cost of remediation or proposed settlement. During the years ended December 31, 2025, 2024 and 2023, we accrued additional warranty expenses of approximately $19.7 million, $22.9 million and $42.7 million, respectively, beyond the normal warranty expense described above related to the remediation of specific wind blade models. Changes in warranty reserves could have a material effect on our consolidated financial statements. For example, as of December 31, 2025, a hypothetical change of 10% in the accrual rate of our warranty reserve would have resulted in a change to our warranty reserve of approximately $5.6 million.
Recent Accounting Pronouncements
For a discussion of recent accounting pronouncements, see Note 1 – Summary of Operations and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Not applicable.
Item 8. Financial Statements and Supplementary Data
The financial statements required to be filed pursuant to this Item 8 are appended to this Report. An index of those financial statements is found in Part IV, Item 15 of this Annual Report on Form 10-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized, and reported within the time period specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.
56
As required by Rule 13a-15(b) promulgated under the Exchange Act, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the design and operating effectiveness as of December 31, 2025 of our disclosure controls and procedures, as defined in Rule 13a-15(e) promulgated under the Exchange Act. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2025.
Management’s Report on Internal Control Over Financial Reporting
As required by Rules 13a-15(f) promulgated under the Exchange Act, our management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. Management based its assessment on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Management's assessment included evaluation of elements such as the design and operating effectiveness of key financial reporting controls, process documentation, accounting policies and our overall control environment. Based on this assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2025 to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. We reviewed the results of management's assessment with the Audit Committee of our Board of Directors.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during the three months ended December 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
None.
57
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information about the Executive Officers required by this Item is incorporated by reference to “Business – Information about our Executive Officers” included in Part I, Item 1 of our 2025 10-K.
Set forth below is the name, age (as of March 25, 2026), position and background (which includes a description of the relevant business experience) of each of our directors:
Name |
|
Age |
|
Position |
Steven C. Lockard |
|
64 |
|
Chairman of the Board and Director |
Paul G. Giovacchini (1)(4) |
|
68 |
|
Lead Independent Director |
William E. Siwek |
|
63 |
|
President & Chief Executive Officer, Director |
Jayshree S. Desai |
|
54 |
|
Director |
Bavan M. Holloway (1)(2) |
|
61 |
|
Director |
Tyrone M. Jordan (1)(3) |
|
64 |
|
Director |
Neal P. Goldman (4) |
|
56 |
|
Director |
Timothy R. Pohl (4) |
|
58 |
|
Director |
Background of Directors
Steven C. Lockard has been Chairman of the Board since May 2020. From 2004 to 2020, he was our President and Chief Executive Officer, and has served as a member of the Board since 2004. Prior to joining us in 1999, Mr. Lockard was Vice President of Satloc, Inc., a supplier of precision GPS equipment, from 1997 to 1999. Prior to that, Mr. Lockard was Vice President of marketing and business development and a founding officer of ADFlex Solutions, Inc., a Nasdaq-listed international manufacturer of interconnect products for the electronics industry, from 1993 to 1997. Prior to that, Mr. Lockard held several marketing and management positions at Rogers Corporation from 1982 to 1993. Mr. Lockard is a member of the board of directors of D2Zero Limited, a provider of decarbonization and clean energy solutions in the United Kingdom. Mr. Lockard is also Chairman of the board of directors of Tekmar Group PLC (LON:TGP), a UK based provider of products and services to the offshore energy market. Mr. Lockard serves as an Operating Partner with SCF Partners and Angeleno Group, equity investment firms that provide growth capital for companies in the energy transition space. Mr. Lockard also currently serves as Managing Director for OpenMinds, Inc., a 501(c)(3) non-profit company working to address the dual challenge of energy and climate. Mr. Lockard previously served for ten years as a board member and Chair of the American Wind Energy Association. Mr. Lockard holds a B.S. in Electrical Engineering from Arizona State University.
Paul G. Giovacchini is the Lead Independent Director and served as Chairman of the Board from 2006 to 2020. Mr. Giovacchini has served as an independent consultant to Advantage Capital Management Corporation since October 2021. Mr. Giovacchini also has served as an independent consulting advisor to Ares Management LLC since January 2023 and to Landmark Partners, Inc., from 2014 through January 2023. Prior to 2014, he served as a Principal of Landmark Partners, Inc. since 2005. Mr. Giovacchini has been investing in privately held companies on behalf of institutional limited partnerships since 1987. He currently serves as a director of Climb Global Solutions, Inc. (Nasdaq:CLMB), a value-added global IT products distributor for innovative technology vendors, TS-Polder Holdings, LLC, a designer and manufacturer of consumer home goods, Medefy Health Inc., a healthcare benefits navigation mobile platform and cost containment provider, and Exum Instruments Inc., a provider of innovative next generation user-friendly instruments for analytical chemistry. Mr. Giovacchini previously served as a director of CaLLogix, Inc., a fully integrated contact center providing a full menu of customized outsourced programs, and Riot Edge Solutions Inc., a provider of wireless remote sensors. Mr. Giovacchini holds an A.B. in Economics from Stanford University and an M.B.A. from Harvard University.
58
William E. Siwek was elected to the Board in May 2020 and has been our President and Chief Executive Officer since May 2020. In May 2019, Mr. Siwek was promoted to President and ceased serving as the Chief Financial Officer of the Company, a role he had held since joining the Company in 2013. Prior to joining the Company, Mr. Siwek previously served as the Chief Financial Officer for T.W. Lewis Company, an Arizona-based real estate investment company, from September 2012 to September 2013. From May 2010 until September 2012, he was an independent consultant assisting companies in the real estate, construction, insurance and renewable energy industries. Prior to that, Mr. Siwek was Executive Vice President and Chief Financial Officer of Talisker Mountain, Inc., from January 2009 to April 2010. Prior to that, he was President and Chief Financial Officer of the Lyle Anderson Company from December 2002 to December 2008. Prior to that, Mr. Siwek spent 18 years, from September 1984 to May 2002, with Arthur Andersen where he became a Partner in both Audit and Business Consulting Divisions. Mr. Siwek previously served on the board of the American Clean Power Association, which represents renewable energy companies in the U.S. and promotes the growth of clean power. Mr. Siwek holds B.S. degrees in Accounting and Economics from University of Redlands.
Jayshree S. Desai has served as a member of the Board since September 2017. Since July 2022, Ms. Desai has served as the Chief Financial Officer of Quanta Services, Inc. (NYSE: PWR), a leading specialty contractor for the electric power, pipeline, industrial and communications industries. From January 2020 to July 2022, Ms. Desai served as the Chief Corporate Development Officer of Quanta Services, Inc. From 2018 to 2019, Ms. Desai served as President of ConnectGen LLC, a company focused on the development of wind, solar and storage projects. From 2010 to 2018, Ms. Desai served as the Chief Operating Officer of Clean Line Energy Partners LLC, a developer of transmission line infrastructure projects that deliver wind energy to communities and cities that lack access to low-cost renewable energy resources. From 2002 to 2010, Ms. Desai served as Chief Financial Officer of EDP Renewables North America f/k/a Horizon Wind Energy, a developer, owner and operator of wind farms. Ms. Desai began her career as a business analyst at McKinsey & Company and also held various positions in the corporate development department of Enron Corporation. Ms. Desai previously served on the Executive Board of KIPP Texas, a non-profit organization of public, charter schools for the underserved communities in Texas. Ms. Desai previously served as the Chairperson of the Board of the Wind Energy Foundation, a nonprofit organization dedicated to raising public awareness of wind as a clean, domestic energy source. Ms. Desai holds an M.B.A. from the Wharton School of the University of Pennsylvania and a Bachelor of Business Administration from the University of Texas at Austin.
Bavan M. Holloway joined the Board in September 2020. She currently serves as the Chair of our audit committee. From August 2010 to April 2020, Ms. Holloway served as Vice President of Corporate Audit for The Boeing Company (“Boeing”). Ms. Holloway also served in various senior finance roles for Boeing from May 2002 to August 2010. Prior to joining Boeing, Ms. Holloway worked for KPMG, LLP as a partner and in other roles primarily serving investment services, broker dealer and financial clients. Her internal audit experience has spanned the breadth of enterprise processes, including cybersecurity, supply chain, manufacturing, engineering and overall risk management. Ms. Holloway currently serves on the Board of Directors of Callaway Golf Company (NYSE: CALY) and previously served on the Board of Directors of T-Mobile US, Inc. (Nasdaq: TMUS) from June 2021 through 2023. Ms. Holloway holds a B.S. degree in Business Administration from the University of Tulsa and a M.S. degree in Financial Markets and Trading from the Illinois Institute of Technology.
Tyrone M. Jordan has served as a member of the Board since January 2019. He currently serves as the Chair of our nominating and corporate governance committee. Mr. Jordan served as President and Chief Operating Officer of DURA Automotive Systems, a leading tier one automotive supplier of electric/hybrid systems, advanced driver-assistance systems, mechatronics, lightweight structural systems, and luxury trim systems for premier automotive brands, from October 2015 until his retirement in March 2019. Mr. Jordan joined DURA following a career of more than three decades with General Motors Company and United Technologies Corporation, most recently serving as Executive Vice President, Global Operations and Customer Experience at General Motors. During his 25-year tenure with General Motors, which included living internationally in Brazil, China and Mexico, Mr. Jordan held positions of increasing responsibility in operations, purchasing, technology, business development, strategy, mergers and acquisitions, and engineering. Mr. Jordan currently serves on the board of directors of Oshkosh Corporation (NYSE: OSK), Axalta Coating Systems (NYSE: AXTA), and FuelCell Energy, Inc. (Nasdaq: FCEL). From 2020 to 2023, Mr. Jordan served on the board of directors of Trinity Industries, Inc. (NYSE: TRN) and also served on the board of directors of Cooper Tire & Rubber Company (NYSE: CTB) from 2020 to 2021. Mr. Jordan serves on the Dean’s Advisory Board of the College of Business of Eastern Michigan University. Mr. Jordan received his
59
Executive Aerospace & Defense Master of Business Administration (ADMBA) in Operations, Strategy & Finance from the University of Tennessee, a degree in Pre-law from Eastern Michigan University and a degree in Industrial Engineering Technology from Purdue University. Mr. Jordan is the founder of the Beatrice Cozetta Jordan Scholarship, co-founder of the Henry Elbert Harden Scholarship and the Tyrone M. & Sherri L. Jordan Endowment Fund at Eastern Michigan University.
Neal P. Goldman has served as a member of the Board since May 2025. Mr. Goldman has over 30 years of experience in investing and working with companies to maximize shareholder value. He is currently the Managing Member of SAGE Capital Investments, LLC, a consulting firm specializing in independent board of director services, strategic planning, and transformations for companies in multiple industries including energy, technology, media, retail, healthcare, gaming, and industrials. He also currently serves as Chairman of the Board of Talos Energy LLC and is a member of the board of Weatherford International and iRobot Corp. Mr. Goldman was formerly a Managing Director at Och-Ziff Capital Management, LP and a Founding Partner of Brigade Capital Management, LLC, which he helped to build to over $12 billion in assets under management. Mr. Goldman received a BA from the University of Michigan and an MBA from the University of Illinois.
Timothy R. Pohl has served as a member of the Board since May 2025. Mr. Pohl has provided strategic, financial and legal advice to both public and private companies for over 30 years. Mr. Pohl is currently a Senior Advisor and Consultant at TRP Advisors, LLC, providing senior level strategic advisory services relating to restructurings, distressed M&A and refinancings. Mr. Pohl served on the board of directors of Mondee Holdings, Inc. from 2024 to 2025, and Libbey, Inc. from May to November 2020. From 2009 to 2019, Mr. Pohl was a Managing Director at Lazard, Freres & Co. LLC and was previously a Partner and Co-Head of Global Restructuring at the law firm Skadden Arps Slate Meagher & Flom LLP and served on the board of a number of privately owned companies. Mr. Pohl received a BA from Amherst College and a J.D. from the University of Chicago School of Law.
Family Relationships
There are no family relationships among any of our directors and executive officers.
Delinquent Section 16(a) Reports
Section 16(a) of the Exchange Act requires our directors, executive officers and persons who own more than 10% of our common stock, to file with the SEC initial reports of beneficial ownership and reports of changes in beneficial ownership. Officers, directors and greater than 10% stockholders are required by SEC regulations to furnish us with copies of all such reports.
To our knowledge, based solely on a review of the copies of such reports furnished to us and written representations that no other reports were required, we believe that for 2025, all required reports were filed on a timely basis under Section 16(a) other than various Form 3 and Form 4 filings filed by Dere Construction and its affiliates.
Insider Trading Policy and Rule 10b5-1 Sales Plans
Corporate Governance and Board Structure
The Board, which is elected by our stockholders, is responsible for directing and overseeing our business and affairs. In carrying out its responsibilities, the Board selects and monitors our top management, provides oversight of
60
our financial reporting processes and determines and implements our corporate governance policies. A copy of our corporate governance guidelines can be found on our website at: https://ir.tpicomposites.com/websites/tpicomposites/English/4300/governance-documents.html.
The Board and management are committed to good corporate governance to ensure that we are managed for the long-term benefit of our stockholders, and we have a variety of policies and procedures to promote such goals. To that end, during the past year, our management periodically reviewed our corporate governance policies and practices to ensure that they remain consistent with the requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), SEC rules and the listing standards of Nasdaq.
Besides verifying the independence of the members of the Board and committees (which is discussed in the section titled “Independence of the Board of Directors”), at the direction of the Board, we also:
In addition, we have adopted a set of corporate governance guidelines. The nominating and corporate governance committee is responsible for reviewing our corporate governance guidelines from time to time and reporting and making recommendations to the Board concerning corporate governance matters. Our corporate governance guidelines address such matters as:
Meetings of the Board of Directors
In 2025, the Board held thirteen formal board meetings and also held telephonic update calls with respect to various operational and strategic matters although no formal actions were taken during these calls. Each director attended at least 75% of all meetings of the Board and the committees on which they served that were held during fiscal year 2025. Under our corporate governance guidelines, directors are expected to spend the time needed and meet as frequently as the Board deems necessary or appropriate to discharge their responsibilities. Directors are also expected to make efforts to attend our annual meeting of stockholders, all meetings of the Board and all meetings of the committees on which they serve.
Code of Business Conduct and Ethics
The Board has adopted a code of business conduct and ethics that applies to all of our employees, officers, and directors, including our Chief Executive Officer, Chief Financial Officer, and other executive and senior financial
61
officers. A copy of our code of business conduct and ethics is available on our website at https://ir.tpicomposites.com/websites/tpicomposites/English/4300/governance-documents.html and may also be obtained, without charge, by contacting our Secretary at TPI Composites, Inc., 9200 E. Pima Center Parkway, Suite 250, Scottsdale, AZ 85258. We intend to disclose any amendments to our code of business conduct and ethics, or waivers of its requirements, on our website or in filings under the Exchange Act, as required by the applicable rules and exchange requirements. During fiscal year 2025, no waivers were granted from any provision of the code of business conduct and ethics.
Independence of the Board of Directors
The Board has undertaken a review of the independence of each director. Based on information provided by each director concerning his or her background, employment and affiliations, the Board has determined that Messrs. Giovacchini, Jordan, Lockard, Goldman, Pohl, Ms. Desai, and Ms. Holloway, do not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the applicable rules and regulations of the SEC, and the listing standards of Nasdaq. In making these determinations, the Board considered the current and prior relationships that each non-employee director has with the Company and all other facts and circumstances the Board deemed relevant in determining their independence, including the beneficial ownership of our capital stock by each non-employee director.
Board’s Role in Risk Oversight
The Board’s role in overseeing the management of our risks is conducted primarily through committees of the Board, as disclosed in the descriptions of each of the committees below and in the charters of each of the committees. The full Board (or the appropriate board committee in the case of risks that are under the purview of a particular committee) discusses with management our major risk exposures, their potential impact on the Company, and the steps we take to manage them. When a board committee is responsible for evaluating and overseeing the management of a particular risk or risks, the chairperson of the relevant committee reports on the discussion to the full Board during the committee reports portion of the next Board meeting. This enables the Board and its committees to coordinate the risk oversight role, particularly with respect to risk interrelationships.
Board Leadership Structure
We believe that the structure of the Board and its committees provides strong overall management of the Company. The positions of Chairperson of the Board, Chief Executive Officer and lead independent director roles are held by separate individuals. This structure enables each person to focus on different aspects of company leadership. Our Chief Executive Officer is responsible for setting the strategic direction of the Company, the general management and operation of the business and the guidance and oversight of senior management. By contrast, the Chairperson of the Board oversees Board governance practices, monitors the content, quality and timeliness of information sent to the Board and is available for consultation with the Board regarding the oversight of our business affairs. Mr. Giovacchini has served as our lead independent director since May 2020. As lead independent director, Mr. Giovacchini presides over periodic meetings of our independent directors, will serve as a liaison between our Chairperson of the Board and the independent directors, and will perform such additional duties as the Board may otherwise determine and delegate.
We believe this structure of a separate Chairperson of the Board, Chief Executive Officer and lead independent director, reinforces the independence of our Board as a whole and results in an effective balancing of responsibilities, experience and independent perspective that meets the current corporate governance needs and oversight responsibilities of our Board.
Committees of the Board of Directors
The Board has established an audit committee, a compensation committee, a nominating and corporate governance committee, and a transaction committee. The composition and responsibilities of each committee are
62
described below. Members serve on these committees until their resignation or until otherwise determined by the Board. Each of the audit, compensation, nominating and corporate governance, and transaction committees operates pursuant to a separate written charter adopted by the Board that is available on our website at https://ir.tpicomposites.com/websites/tpicomposites/English/4300/governance-documents.html.
Audit Committee
Our audit committee currently consists of Ms. Holloway, and does not have the required three members due to departures of previous board members. The Company notified Nasdaq on May 11, 2025 of its non-compliance with Nasdaq Rule 5605(c)(2)(A), which requires that the audit committee be composed of three directors that satisfy certain criteria, and its intent to rely on the cure period provided by Nasdaq Rule 5605(c)(4)(B). On August 19, 2025, due to the Chapter 11 Cases, the Company’s common stock was delisted from the Nasdaq and began trading on the OTC Pink Market. Our audit committee, among other things:
Our audit committee operates under a written charter that satisfies the applicable rules of the SEC. Our audit committee held four meetings during fiscal year 2025.
Compensation Committee
Our compensation committee currently consists of Mr. Giovacchini, Mr. Jordan, and Ms. Holloway, with Mr. Giovacchini serving as Chair. The composition of our compensation committee meets the requirements for independence under SEC rules and regulations. Each member of the current compensation committee is also a non-employee director, as defined pursuant to Rule 16b-3 promulgated under the Exchange Act. The function of our
63
compensation committee is to discharge the responsibilities of the Board relating to the compensation of our directors and executive officers. Our compensation committee, among other things:
Our compensation committee operates under a written charter that satisfies the applicable rules of the SEC. Our compensation committee held two meetings during fiscal year 2025.
Nominating and Corporate Governance Committee
Our nominating and corporate governance committee currently consists of Mr. Jordan due to departures of previous board members. Our nominating and corporate governance committee, among other things:
The nominating and corporate governance committee operates under a written charter that satisfies the applicable rules of the SEC. Our nominating and corporate governance committee held two meetings during fiscal year 2025.
Transaction Committee
During fiscal year 2025, the Board established, authorized and formed a transaction committee of independent members to, among other things, develop, consider, evaluate and negotiate potential capital structure solutions or other strategic alternatives for or on behalf of the Company, including the Company's decision to file for chapter 11 bankruptcy protection and initiate the Chapter 11 cases. Our transaction committee currently consists of Mr. Giovacchini, Mr. Goldman and Mr. Pohl. The transaction committee currently meets on a weekly basis, and among other things:
64
Our transaction committee held thirty-six meetings during fiscal year 2025.
Identifying and Evaluating Director Nominees
The Board has delegated to the nominating and corporate governance committee the responsibility of identifying suitable candidates for nomination to the Board (including candidates to fill any vacancies that may occur) and assessing their qualifications in light of the policies and principles in our corporate governance guidelines and the committee’s charter. The nominating and corporate governance committee may gather information about the candidates through interviews, detailed questionnaires, comprehensive background checks or any other means that the nominating and corporate governance committee deems to be appropriate in the evaluation process. The nominating and corporate governance committee then meets as a group to discuss and evaluate the qualities and skills of each candidate, both on an individual basis and taking into account the overall composition and needs of the Board. Based on the results of the evaluation process, the nominating and corporate governance committee recommends candidates for the Board’s approval as director nominees for election to the Board.
Minimum Qualifications and Board Diversity
Our nominating and corporate governance committee uses a variety of methods for identifying and evaluating director nominees and will consider all facts and circumstances that it deems appropriate or advisable. In its identification and evaluation of director candidates, our nominating and corporate governance committee will consider the current size and composition of the Board and the needs of the Board and the respective committees of the Board. Some of the qualifications that our nominating and corporate governance committee considers include, without limitation, issues of character, ethics, integrity, judgment, diversity, independence, skills, education, expertise, business acumen, length of service, understanding of our business and industry, potential conflicts of interest and other commitments. Nominees must also have proven achievement and competence in their field, the ability to offer advice and guidance to our management team, the ability to make significant contributions to our success, and an understanding of the fiduciary responsibilities that are required of a director. Director candidates must have sufficient time available in the judgment of our nominating and corporate governance committee to perform all board of director and committee responsibilities. Members of the Board are expected to prepare for, attend, and participate in all board of director and applicable committee meetings. Other than the foregoing, there are no stated minimum criteria for director nominees, although our nominating and corporate governance committee may also consider such other factors as it may deem, from time to time, are in our and our stockholders’ best interests.
Although the Board does not maintain a specific policy with respect to board diversity, the Board believes that it should be a diverse body. Our nominating and corporate governance committee considers a broad range of backgrounds and experiences. In making determinations regarding nominations of directors, our nominating and corporate governance committee takes into account the benefits of diverse viewpoints. Our nominating and corporate governance committee also considers these and other factors as it oversees the annual Board and committee evaluations. After completing its review and evaluation of director candidates, our nominating and corporate governance committee recommends to the full Board the director nominees for selection.
Stockholder Outreach and Engagement
We maintain an investor relations outreach program to solicit input and to communicate with stockholders on a variety of topics related to our business and strategy. Over the course of a year, our investor relations team, some of our named executive officers (“NEOs”) and other key employees typically speak with numerous investors through investor roadshows, conferences and virtual/telephonic conversations.
65
This dialogue provides an opportunity to discuss governance matters generally, including our board structure, our corporate governance documents and policies, directors’ skills and tenure, our Board’s oversight roles and responsibilities, our various social and environmental initiatives, and our approach to compensation matters, including the linkage between pay and performance and our compensation program’s alignment to our stockholders’ interests.
Stockholder Recommendations
Stockholders may submit recommendations for director candidates to the nominating and corporate governance committee by sending the individual’s name and qualifications to our Secretary at TPI Composites, Inc., 9200 E. Pima Center Parkway, Suite 250, Scottsdale, AZ 85258, who will forward all recommendations to the nominating and corporate governance committee. The nominating and corporate governance committee will evaluate any candidates recommended by stockholders against the same criteria and pursuant to the same policies and procedures applicable to the evaluation of candidates proposed by directors or management.
Stockholder Communications
The Board provides to every stockholder the ability to communicate with the Board as a whole, the non-employee directors as a group, and with individual directors on the Board through an established process for stockholder communication. For a stockholder communication directed to the Board as a whole, stockholders and other interested parties may send such communication to our Chief Executive Officer at TPI Composites, Inc., 9200 E. Pima Center Parkway, Suite 250, Scottsdale, AZ 85258, Attn: Board of Directors, Attn: Chief Executive Officer.
For a stockholder communication directed to an individual director in his or her capacity as a member of the Board, stockholders and other interested parties may send such communication to the attention of the individual director to: TPI Composites, Inc., 9200 E. Pima Center Parkway, Suite 250, Scottsdale, AZ 85258, Attn: Name of Individual Director.
The Company shall review all incoming communications and forward such communications to the appropriate member(s) of the Board as well as the Chairperson of the Board, in his or her capacity as a representative of the Board. The Chief Executive Officer will generally not forward communications that are unrelated to the duties and responsibilities of the Board, including communications that the Chief Executive Officer determines to be primarily commercial in nature, product complaints or inquires, and materials that are patently offensive or otherwise inappropriate.
66
Item 11. Executive Compensation
Overview
For the year ended December 31, 2025, our named executive officers were:
The following information should be read together with the compensation tables and related disclosures set forth on the pages that follow.
Executive Summary
2025 Executive Compensation Program Overview
Our performance in 2025 has been reflected in our executive pay outcomes and decisions made by our compensation committee in 2025, which are consistent with our pay for performance culture with respect to our named executive officer’s compensation packages.
Base Salary Adjustments: Our compensation committee approved an increase in the base salary of Mr. Siwek of 3.7% and an increase in the base salary of Mr. Miller of 3.7% and Mr. Stroo of 6.0%. Each of these increases became effective on March 24, 2025. In approving and/or reviewing these salary increases, the compensation committee considered competitive market data derived from the Company’s peer group described below.
Short Term Cash Incentive Compensation: Our executive compensation program includes short-term incentive compensation in the form of annual incentive cash bonuses that are contingent upon achievement of certain business and financial objectives, including targets relating to (i) safety, (ii) sustainability, (iii) inclusion, diversity, equity and awareness (“IDEA”), (iv) cost of poor quality, (v) cash flow and (vi) profitability. Pursuant to the retention bonuses that were granted in June 2025 discussed below, the named executive officers did not receive any compensation under and were eligible to participate in the short-term cash incentive plan for fiscal year 2025.
Long-Term Equity Incentive Compensation: Our compensation committee granted long-term incentive opportunities to our named executive officers in the form of a combination of time-based restricted stock units subject to multi-year vesting based on continued service, and performance-based restricted stock units subject to multi-year vesting based on (i) continued service, and (ii) either the achievement of three annual Adjusted EBITDA targets or the achievement of relative total shareholder return targets benchmarked against the Nasdaq Clean Energy Index determined over a three-year period. Pursuant to the retention bonuses that were granted in June 2025 discussed below, the named executive officers were not eligible for any long-term equity incentive grants for fiscal year 2025. Accordingly, the long-term equity incentive awards that were granted to the named executive officers in March 2025 were subsequently cancelled and forfeited in June 2025 upon the acceptance of the retention bonuses by each named executive officer.
Special award granted in 2025: On June 13, 2025, the Compensation Committee approved retention bonuses (the “Retention Bonuses”) for certain executive and non-executive employees of the Company, including the named executive officers, which were awarded pursuant to the terms of retention bonus agreements (the “Retention Bonus Agreements”). Pursuant to the Retention Bonus Agreements, the following amounts were paid to each named executive officer in June 2025: (i) $1,225,459 to William E. Siwek, the Company’s President and Chief Executive Officer; (ii) $518,155 to Ryan Miller, the Company’s Chief Financial Officer; and (iii) $487,500 to Charles Stroo, the Company’s Chief Operating Officer. For the named executive officers and certain other executive officers, the Retention Bonus Agreements which provide for the recoupment of the gross amounts of the Retention Bonuses if the Recipient does not remain employed with the Company (or if the Recipient provides or receives a notice of termination), in each case, other than in the event of a Qualified Termination (as defined in and subject to the terms of the Retention Bonus Agreements), through the earlier of March 31, 2026 or the date that is sixty (60) days
67
following the occurrence of a Restructuring Event (as defined in the Retention Bonus Agreement). Pursuant to the Retention Bonus Agreements, the Retention Bonus replaced the named executive officers’ and certain other executive officers’ right to receive certain other compensatory payments, as described in their Retention Bonus Agreements, including the short-term cash incentive bonus and long-term equity incentive awards for fiscal year 2025 as discussed above.
Primary Compensation Programs
The primary compensation programs for our executive officers, including our named executive officers, are designed to provide the following:
Compensation Element |
|
Objective |
|
Features |
Base Salary |
|
Attract, motivate and retain employees at the executive level who contribute to our long-term success. |
|
Fixed component of pay to provide financial stability, based on responsibilities, experience, individual contributions, and peer company data. |
Cash incentive bonuses |
|
To compensate executives for Company-wide performance and individual performance in terms of achieving Company-wide, division and individual performance goals; to motivate and attract executives. |
|
Variable component of pay based on annual corporate, division and individual quantitative and qualitative goals. |
Long-term equity incentive compensation granted in the form of time-based and performance-based restricted stock units |
|
To incentivize executives to deliver long-term financial performance and stockholder value, while also providing a retention vehicle for top leadership talent. We believe these awards align employee interests with those of our stockholders over the longer-term. |
|
Typically, a combination of time-based restricted stock units subject to multi-year vesting based on continued service, and performance-based restricted stock units subject to multi-year vesting based on continued service and either the achievement of pre-determined goals tied to achieving certain Adjusted EBITDA or total shareholder return targets. |
Long-term equity incentive compensation granted in the form of stock options |
|
To provide a strong reward for growth in the market price of our common stock as their entire value depends on future stock price appreciation, as well as a strong incentive for our executive officers to remain employed with the Company as they require continued employment with the Company through the vesting period. |
|
Typically, vests over a four-year period. |
The other elements of our executive compensation program are severance and change in control benefits, broad-based health and welfare benefits, a 401(k) plan available to all U.S. employees and limited perquisites, each of which are described in more detail below.
68
Executive Compensation Policies and Practices
In addition to our direct compensation elements, the following table summarizes features of our compensation policies and practices that are designed to align our executive team with stockholder interests and with market best practices:
What We Do |
|
What We Don’t Do |
Allocate a portion of our executive officers’ target total direct compensation to equity-based awards, which are therefore “at risk”, to align the interests of our executive officers and stockholders |
|
Provide any compensation-related tax gross-ups |
Link a portion of our executive officers’ target total direct compensation to total shareholder return |
|
Provide excessive perquisites |
Maintain an industry-specific peer group comprised of similarly sized companies for benchmarking pay on an annual basis |
|
Provide any pension arrangements, non-qualified deferred compensation arrangements or retirement plans to our executive officers other than a 401(k) plan that is generally available to all U.S. employees |
Offer market-competitive benefits for executives that are consistent with the rest of our employees |
|
Allow hedging by our officers or directors of Company stock unless pre-approved by our audit committee |
Consult with an independent compensation consultant on compensation levels and practices on an annual basis |
|
Allow pledging by our officers or directors of Company stock unless pre-approved by our audit committee |
Perform an annual compensation-related risk assessment by our compensation committee |
|
|
Maintain CEO, executive officer and non-employee director stock ownership guidelines |
|
|
Maintain a clawback policy with respect to incentive-based cash and equity compensation |
|
|
Seek an annual non-binding, advisory vote from stockholders to approve the named executive officer compensation program described in the CD&A |
|
|
Setting Executive Compensation
Role of the Compensation Committee
Our compensation committee is primarily responsible for developing and implementing our compensation policies. It establishes and approves the compensation for our Chief Executive Officer and reviews and determines the compensation of our other executive officers. Our compensation committee may establish and delegate authority to one or more subcommittees consisting of one or more of its members, when the compensation committee deems it appropriate to do so in order to carry out its responsibilities. In 2025, our compensation committee did not delegate such authority. Our compensation committee oversees our compensation and benefit plans and policies, administers our equity incentive plans and reviews and approves annually all compensation decisions relating to all of our executive officers, including our Chief Executive Officer. When formulating its recommendations for the amount of each compensation element and approving each compensation element and the target total direct compensation opportunity for our executive officers, our compensation committee considers the following factors:
69
These factors provide the framework for compensation decision-making and final decisions regarding the compensation opportunity for each executive officer. No single factor is determinative in setting pay levels, nor was the impact of any factor on the determination of pay levels quantifiable. Our compensation committee reviews the base salary levels, cash incentive bonuses, and long-term incentive compensation opportunities of our executive officers, including our named executive officers, each fiscal year at the beginning of the year, or more frequently as warranted. Long-term incentive compensation is granted on a regularly-scheduled basis, as described in the “Individual Compensation Elements – Long Term Incentives” section below.
Role of the Chief Executive Officer
In discharging its responsibilities, our compensation committee works with members of our management, including our Chief Executive Officer. Our management team assists our compensation committee by providing information on corporate and individual performance, market compensation data and management’s perspective on compensation matters. Our compensation committee solicits and reviews our Chief Executive Officer’s recommendations and proposals with respect to adjustments to annual cash compensation, long-term incentive compensation opportunities, program structures and other compensation-related matters for our executive officers (other than with respect to his own compensation).
Our compensation committee reviews and discusses these recommendations and proposals with our Chief Executive Officer and considers them as one factor in advising on and determining the compensation for our executive officers, including our other named executive officers. Our Chief Executive Officer recuses himself from all discussions and recommendations regarding his own compensation.
Role of the Compensation Consultants
Our compensation committee has the authority under its charter to engage the services of a consulting firm or other outside advisor to assist it in designing our compensation programs and in making compensation decisions. In 2025, the compensation committee retained Aon’s Human Capital Solutions practice, a division of Aon plc (“Aon”), as its independent third-party compensation consultant to advise on director and executive compensation matters including: overall compensation program design and the design of our performance-based equity award program, peer group development and updates, and benchmarking executive officer and board of director compensation programs. Aon did not provide any additional services to us in 2025. Aon reports directly to our compensation committee. We do not believe the retention of, and the work performed by, Aon creates any conflict of interest.
Defining and Comparing Compensation to Market Benchmarks
In evaluating the total compensation of our named executive officers, our compensation committee, using information provided by Aon, establishes a peer group of publicly traded companies in the industrial machinery, aerospace and defense, and electrical components and equipment industries, among others, that is selected based on a balance of the following criteria:
70
Our peer group for 2025 was comprised of the following 22 companies set forth below:
Advanced Energy Industries, Inc. |
|
Curtiss-Wright Corporation |
|
ITT Inc. |
Ameresco, Inc. |
|
Enerpac Tool Group Corp. |
|
Moog Inc. |
Array Technologies, Inc. |
|
EnerSys |
|
Nextracker Inc. |
AZZ Inc. |
|
EnPro Industries, Inc. |
|
Ormat Technologies, Inc. |
Babcock & Wilcox Enterprises, Inc. |
|
ESCO Technologies Inc. |
|
RBC Bearings Incorporated |
Barnes Group Inc. |
|
Franklin Electric Co., Inc. |
|
Woodward, Inc. |
Bloom Energy Corporation |
|
Generac Holdings Inc. |
|
|
Blue Bird Corporation |
|
Hexcel Corporation |
|
|
We believe that our 2025 peer group provided us with appropriate compensation data for evaluating the competitiveness of the compensation levels and practices of our named executive officers during 2025.
In 2025, the primary market reference point considered by our compensation committee in establishing target total compensation for our executive officers was the 50th percentile of our 2025 peer group. Although our compensation committee and the Board target compensation as described above, they also consider other criteria, including market factors, the experience level of the executive, organizational criticality and the executive’s performance against established goals of the Company, in determining variations to this general target.
Individual Compensation Elements
Base Salary
Base salary represents the fixed portion of the compensation of our executive officers, including our named executive officers, and is an important element of compensation intended to attract and retain high-performing individuals.
Using the competitive market data provided by Aon, as well as evaluating the executive officer’s responsibilities, experience and individual contributions, our compensation committee reviews and develops recommendations for adjusting the base salaries for each of our executive officers, including our named executive officers, as part of its annual executive compensation review. In addition, the base salaries of our executive officers may be adjusted by our compensation committee in the event of a promotion or significant change in responsibilities.
Generally, our compensation committee sets base salaries with reference to the 50th percentile of the competitive range of our compensation peer group and applicable executive compensation survey data. We have evaluated the base salaries of our executive officers in the context of establishing their total cash compensation at levels that are consistent with the target total cash compensation of executive officers holding comparable positions at other public companies in our peer group.
71
In March 2025, based on a consideration of the factors described in the “Setting Executive Compensation” section above and consistent with the recommendation of our Chief Executive Officer, our compensation committee determined to increase the base salaries of certain executive officers, and these increases became effective on March 24, 2025. Our compensation committee determined and approved an increase in base salary for our Chief Executive Officer, effective on March 24, 2025, based on a consideration of similar factors. In making these decisions, our compensation committee also considered the current risks and challenges facing us.
The base salaries of our named executive officers for 2025 were adjusted as follows:
Named Executive Officer |
|
2024 Base Salary |
|
|
2025 Base Salary |
|
|
% Change |
|
|||
William E. Siwek |
|
$ |
927,500 |
|
|
$ |
962,281 |
|
|
|
3.7 |
% |
Ryan Miller |
|
|
540,801 |
|
|
|
561,081 |
|
|
|
3.7 |
|
Charles Stroo |
|
|
500,000 |
|
|
|
530,000 |
|
|
|
6.0 |
|
The actual base salaries paid to our named executive officers in 2025 are set forth in the “Summary Compensation Table” section.
Short Term Cash Incentive Program
The Board has adopted a Senior Executive Cash Incentive Bonus Plan (the “Bonus Plan”). The Bonus Plan provides for cash bonus payments based upon the attainment of performance targets established by our compensation committee. The payment targets may be related to financial and operational measures or objectives with respect to the Company, which we refer to as corporate performance goals or objectives, as well as individual performance objectives.
Each executive officer has a target bonus opportunity set for each performance period under the Bonus Plan. Our compensation committee took into account market data, relative levels of responsibility across the Company, and other relevant factors in order to set the target performance-based incentive for each named executive officer in 2025. The corporate performance goals are measured at the end of each performance period after our financial reports have been published or such other appropriate time as our compensation committee determines. If the corporate performance goals and individual performance objectives are met, payments will be made as soon as practicable following the end of each performance period. Subject to the rights contained in any agreement between the executive officer and us, an executive officer must be employed by us on the bonus payment date to be eligible to receive a bonus payment. The Bonus Plan also permits our compensation committee to approve additional bonuses to executive officers in its sole discretion; however, the compensation committee did not do so for 2025.
Pursuant to the retention bonuses that were granted in June 2025 discussed previously, the named executive officers were not eligible to participate in the short-term cash incentive plan for fiscal year 2025.
Long-term Incentives
We view long-term incentive compensation in the form of equity awards as a critical element of our executive compensation program. The realized value of these equity awards bears a direct relationship to our stock price, and, therefore, these awards are an incentive for our executive officers, including our named executive officers, to create value for our stockholders. Equity awards also help us retain qualified executive officers in a competitive market.
Long-term incentive compensation opportunities in the form of equity awards are granted by our compensation committee in accordance with our Amended and Restated 2015 Stock Option and Incentive Plan (as amended from time to time, the “2015 Plan”). The amount and forms of such equity awards are determined by our compensation committee after considering the factors described in the “Setting Executive Compensation” section. The amounts of the equity awards are also intended to provide competitively-sized awards and resulting target total direct compensation opportunities that are competitive with the compensation opportunities offered by the companies in our compensation peer group for similar roles and positions for each of our executive officers, taking into consideration the factors described in the “Setting Executive Compensation” section.
72
Performance-Based Awards
Our compensation committee has granted performance-based restricted stock units to the named executive officers which vest only if we meet specified objective performance criteria and the named executive officer remains in a continued service relationship with us through the applicable performance period. The goals of the Board and our compensation committee in selecting metrics for the performance-based component of the long-term incentive program include: alignment with business strategy; driving achievement of our development goals; and creating stockholder value.
In March 2025, as part of its annual executive compensation review, our compensation committee approved the grant of performance-based restricted stock unit awards to the named executive officers as described in the “Grant of Plan-Based Awards for Fiscal Year 2025” section below. These performance-based restricted stock unit awards represented 60% of such named executive officer’s annual, long term equity incentive award opportunity.
The performance-based restricted stock units vest based upon achieving certain total shareholder returns or Adjusted EBITDA targets, and as follows:
Total Shareholder Return Percentile Rank within the Performance Measurement Index (1) |
|
Performance Multiplier |
|
|
75th Percentile or higher |
|
|
150.0 |
% |
50th Percentile |
|
|
100.0 |
|
25th Percentile |
|
|
50.0 |
|
Below 25th Percentile |
|
|
— |
|
Pursuant to the retention bonuses that were granted in June 2025 discussed previously, the long-term equity incentive awards that were granted to the named executive officers in March 2025, including the TSR PSUs and Adjusted EBITDA PSUs, were subsequently cancelled and forfeited in June 2025 upon the acceptance of the retention bonuses by each named executive officer.
For a summary and discussion of the vesting provisions of the TSR PSUs and Adjusted EBTIDA PSUs in the event of an executive’s termination of employment in connection with the executive’s death or disability or a change
73
in control of the Company, please see the “Employment, Severance and Change of Control Agreements” section below.
Time-Based Awards
Our compensation committee approved the grant of time-based restricted stock unit awards to the named executive officers as described in the “Grant of Plan-Based Awards for Fiscal Year 2025” section below. These time-based restricted stock unit awards represented approximately 40% of our named executive officers’ annual, long-term equity incentive award opportunity. In March 2025, the Committee granted our named executive officers time-based RSU awards that vest over a three-year period with 25%, 25% and 50% of the restricted stock units vesting on the first, second and third anniversary of the grant date, respectively, subject to the named executive officer’s continued service with the Company through each such date. We believe time-based restricted stock units provide a strong retention incentive for our executive officers and also provide a moderate reward for growth in the value of our common stock.
Pursuant to the retention bonuses that were granted in June 2025 discussed previously, the time-based RSU awards that were granted to the named executive officers in March 2025 were subsequently cancelled and forfeited in June 2025 upon the acceptance of the retention bonuses by each named executive officer.
Equity Grant Timing
Benefits and Other Compensation
Other compensation to our executives consists primarily of the broad-based benefits we provide to all full-time employees, including medical, dental and vision insurance, medical and dependent care flexible spending accounts, group life and disability insurance and a 401(k) plan. In designing and structuring these benefit plans, we seek to provide an aggregate level of benefits that are comparable to those provided by similar companies.
We maintain a tax-qualified retirement plan that provides all regular U.S. employees with an opportunity to save for retirement on a tax-advantaged basis. Under our 401(k) plan, participants may elect to defer a portion of their compensation on a pre-tax basis and have it contributed to the plan subject to the applicable annual limits of the Internal Revenue Code of 1986, as amended (the “Code”). Employee elective deferrals are 100% vested at all times. The 401(k) plan allows for matching contributions to be made by us. In 2025 we matched up to 100% of the first 4% of employee contributions to the 401(k) plan.
We generally do not provide perquisites or personal benefits to our named executive officers, other than the payment for our executive officers to obtain an executive physical every two years. We believe offering executive physicals to our executives is beneficial because it ensures that our key executives remain in optimal health and can achieve early identification of potential health risks.
Severance and Other Termination Arrangements
We believe that having in place reasonable and competitive post-employment compensation arrangements are essential to attracting and retaining highly-qualified executive officers. We included certain provisions for payments
74
and benefits in the event of termination of employment, including an involuntary termination of employment in connection with a change in control of the Company, in employment agreements and equity award agreements with our named executive officers.
We believe that the severance payments and benefits provided to our executive officers under their employment agreements are appropriate in light of the post-employment compensation protections available to similarly-situated executive officers at companies in our compensation peer group and are an important component of each executive officer’s overall compensation as they help us to attract and retain our key executives who could have other job alternatives that may appear to them to be more attractive absent these protections.
We also believe that the occurrence or potential occurrence of a change in control transaction will create uncertainty regarding the continued employment of our executive officers. In order to encourage them to remain employed with us during an important time when their prospects for continued employment following a change in control transaction are often uncertain, we provide our executive officers with the opportunity to receive certain protections during a change in control protection period. We provide additional payment and benefit protections that have a double trigger. If a change of control occurs and an executive officer is involuntarily terminated by us without cause or if an executive officer voluntarily terminates employment with us for good reason in connection with a change in control of the Company, because we believe that a voluntary termination of employment for good reason is essentially equivalent to an involuntary termination of employment by us without cause. The primary purpose of these double trigger arrangements is to keep our executive officers focused on pursuing potential corporate transactions that are in the best interests of our stockholders regardless of whether those transactions may result in their own job loss.
Upon the death or disability of a named executive officer, in order to assist the executive’s family during such difficult times, we provide for the immediate acceleration of vesting of all time-based restricted stock unit awards and varying treatment of the performance-based restricted stock unit awards, as such termination provisions allow the executive’s family to receive the benefits of the executive’s existing equity incentive arrangements.
To protect the Company’s interests, our executive officers are required to sign a standard form of release prior to receiving any severance payments or benefits under the terms and conditions of their employment agreements with us.
We do not provide excise tax payments (or “gross-ups”) relating to a change in control of the Company and have no such obligations in place with respect to any of our named executive officers.
For detailed descriptions of the post-employment compensation arrangements we maintain with our named executive officers, as well as an estimate of the potential payments and benefits payable to our named executive officers under their post-employment compensation arrangements, see the “Employment, Severance and Change of Control Agreements” section below.
Tax and Accounting Considerations
Deductibility of Executive Compensation
Section 162(m) of the Code (“Section 162(m)”) disallows a federal income tax deduction for public corporations of remuneration in excess of $1 million paid in any fiscal year to certain specified executive officers. Our compensation committee does not necessarily limit executive compensation to that which is or may be deductible under Section 162(m), but considers various alternatives to preserving the deductibility of compensation payments and benefits to the extent consistent with its compensation goals. Our compensation committee believes that our stockholders’ interests are best served if its discretion and flexibility in awarding compensation is not restricted, even though some compensation awards may result in non-deductible compensation expense.
Taxation of “Parachute” Payments
Sections 280G and 4999 of the Code provide that certain individuals who hold significant equity interests and certain executive officers and certain other service providers may be subject to significant additional taxes if they receive payments or benefits in connection with a change in control of the Company that exceeds certain prescribed limits, and that the Company (or a successor) may forfeit a deduction on the amounts subject to this additional tax.
75
We have not agreed to provide any executive officer, including any named executive officers, with a “gross-up” or other reimbursement payment for any tax liability that the executive officer might owe as a result of the application of Sections 280G or 4999 of the Code.
Section 409A of the Internal Revenue Code
Section 409A of the Code imposes additional significant taxes in the event that an executive officer, director or service provider receives “deferred compensation” that does not satisfy the requirements of Section 409A of the Code. Section 409A of the Code may apply to certain severance arrangements, bonus arrangements and equity awards. We aim to structure all of our severance arrangements, bonus arrangements and equity awards in a manner to either avoid the application of Section 409A or, to the extent doing so is not possible, to comply with the applicable requirements of Section 409A of the Code.
Accounting for Stock-Based Compensation
We follow the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 for our stock-based compensation awards. FASB ASC Topic 718 requires us to measure the compensation expense for all share-based payment awards made to our employees and non-employee members of the Board, including options to purchase shares of our common stock and other stock awards, based on the grant date “fair value” of these awards. This calculation is performed for accounting purposes and reported in the executive compensation tables required by the federal securities laws, even though the recipient of the awards may never realize any value from their awards.
Compensation Risk Assessment
We believe that our executive compensation program does not encourage excessive or unnecessary risk taking. As described more fully above, we structure our pay to consist of both fixed and variable compensation, particularly in connection with our pay-for-performance compensation philosophy. We believe this structure motivates our executives to produce superior short-term and long-term results that are in the best interests of the Company and stockholders in order to attain our ultimate objective of increasing stockholder value, and we have established, and our compensation committee endorses, several controls to address and mitigate compensation-related risks. As a result, we do not believe that our compensation programs are reasonably likely to have a material adverse effect on us.
Stock Ownership Policies
We have a stock ownership policy that applies to our non-employee directors, our Chief Executive Officer and our other executive officers who directly report to our Chief Executive Officer. Our Chief Executive Officer is expected to acquire and maintain shares of our common stock equal to three times the Chief Executive Officer’s base salary and our other executive officers are expected to acquire and maintain shares of our common stock equal to three times their base salaries. Our non-employee directors are expected to acquire and hold the lesser of (i) a number of shares of our common stock equal in value to five times the director’s annual cash retainer for regular service on the Board or (ii) 15,000 shares of our common stock, until such director’s service on the Board ceases. Under the stock ownership policy, (i) executives have five years from the later of May 18, 2022 and their date of hire or promotion, to obtain the expected ownership levels, and (ii) Directors have five years from the later of March 11, 2020 and their date of appointment to the Board to obtain the expected ownership level. For our non-employee directors, we only count directly and beneficially owned shares, shares underlying unvested and vested restricted stock units (either held or deferred) and shares underlying vested and unexercised in-the-money stock options. For our executive officers, we only count directly owned shares, shares of common stock that are restricted with vesting subject only to time-based vesting, restricted stock units that are subject only to time-based vesting, and performance stock units for which performance goals have been achieved and that remain subject to only time-based vesting.
76
“Clawback” Policy
In November 2023, the Board adopted a Compensation Recovery Policy (the “Clawback Policy”), effective October 2, 2023. The Clawback Policy complies with the SEC’s newly adopted clawback rules as required under the Dodd-Frank Act, and provides that in the event we are required to prepare a “financial restatement” (as defined in the Clawback Policy), we will, subject to certain limited exceptions as described in the Clawback Policy, recover certain incentive based compensation from executive officers, including the named executive officers. Compensation that will be recovered under the Clawback Policy generally includes incentive-based compensation received during the three-year period prior to the “restatement date” (as defined in the Clawback Policy) that exceeds the amount that otherwise would have been received by the executive officer had such compensation been determined based on the restated amounts in the financial restatement. Under the Clawback Policy, “incentive based compensation” includes any cash or equity compensation that is granted, earned, or vested based, in whole or in part, upon the attainment of a financial reporting measure as well as any other equity-based compensation. Additionally, the Clawback Policy permits the Board to recover up to 100% of an executive officer’s incentive-based compensation otherwise subject to the Clawback Policy where the Board determines such executive officer’s wrongdoing or grossly negligent acts or omissions contributed to the circumstances requiring the financial restatement. Our compensation committee believes that the Clawback Policy reflects good standards of corporate governance and reduces the potential for excessive risk taking by our executive officers.
EXECUTIVE COMPENSATION
Fiscal year 2025 Compensation Tables
2025 Summary Compensation Table
The following table sets forth the total compensation, for service rendered to us in all capacities, that was awarded to, earned by and paid during the fiscal years ended December 31, 2025, December 31, 2024, and December 31, 2023 for each of our named executive officers.
Name and Principal Position |
|
Year |
|
Salary (1) |
|
|
Bonus (2) |
|
|
Stock Awards (3) |
|
|
Option Awards (4) |
|
|
Non-equity Incentive Plan Compensation (5) |
|
|
All Other Compensation (6) |
|
|
Total |
|
|||||||
William E. Siwek |
|
2025 |
|
$ |
952,917 |
|
|
$ |
1,225,459 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
24,904 |
|
|
$ |
2,203,280 |
|
Chief Executive Officer |
|
2024 |
|
|
921,415 |
|
|
|
— |
|
|
|
472,348 |
|
|
|
— |
|
|
|
204,050 |
|
|
|
21,891 |
|
|
|
1,619,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Ryan Miller |
|
2025 |
|
|
555,621 |
|
|
|
518,155 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
15,270 |
|
|
|
1,089,046 |
|
Chief Financial Officer |
|
2024 |
|
|
535,200 |
|
|
|
— |
|
|
|
135,908 |
|
|
|
111,900 |
|
|
|
81,120 |
|
|
|
15,070 |
|
|
|
879,198 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Charles Stroo (7) |
|
2025 |
|
|
521,923 |
|
|
|
487,500 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
15,270 |
|
|
|
1,024,693 |
|
Chief Operating Officer |
|
2024 |
|
|
500,000 |
|
|
100,000 (8) |
|
|
|
— |
|
|
|
— |
|
|
|
65,000 |
|
|
|
14,830 |
|
|
|
679,830 |
|
|
77
Named Executive Officer |
|
401(k) Match |
|
|
Annual Physical |
|
|
Group Term Life Insurance |
|
|
Long-Term Disability |
|
||||
William E. Siwek |
|
$ |
14,000 |
|
|
$ |
8,344 |
|
|
$ |
1,980 |
|
|
$ |
580 |
|
Ryan Miller |
|
|
14,000 |
|
|
|
— |
|
|
|
690 |
|
|
|
580 |
|
Charles Stroo |
|
|
14,000 |
|
|
|
— |
|
|
|
690 |
|
|
|
580 |
|
Grants of Plan-Based Awards for Fiscal Year 2025
Pursuant to the retention bonuses that were granted in June 2025, the named executive officers were not eligible to participate in the short-term cash incentive plan for fiscal year 2025, and they were not eligible to receive any long-term equity incentive grants for fiscal year 2025. Accordingly, the long-term equity incentive awards that were granted to the named executive officers in March 2025 prior to the retention agreements, were subsequently cancelled and forfeited in June 2025 upon the acceptance of the retention bonuses by each named executive officer. As such, there were no grants of plan-based awards for the named executive officers during the fiscal year ended December 31, 2025 that were outstanding at December 31, 2025.
Outstanding Equity Awards at Fiscal 2025 Year-End
The following table presents information regarding all outstanding equity awards held by each of our named executive officers on December 31, 2025.
78
|
|
|
|
Option Awards (1) |
|
|
|
|
|
|
|
|
|
|
Stock Awards (1) |
|
|
|
|
|||||||||||||
Named Executive Officer |
|
Grant Date |
|
Number of Securities Underlying Unexercised Options Exercisable |
|
|
Number of Securities Underlying Unexercised Options Unexercisable |
|
|
Option Exercise Price |
|
|
Option Expiration Date |
|
Number of Shares or Units of Stock That Have Not Vested |
|
|
Market Value of Shares or Units of Stock That Have Not Vested |
|
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or other Rights That Have not Yet Vested |
|
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Yet Vested (2) |
|
|||||||
William E. Siwek |
|
9/15/2022 |
|
|
133,333 |
|
|
|
66,667 |
|
|
$ |
18.00 |
|
|
9/15/2029 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
24,068 |
|
|
$ |
278 |
|
|
|
|
|
|
|
|||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
36,102 |
|
|
$ |
417 |
|
|||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,986 |
|
|
|
312 |
|
|||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
52,153 |
|
|
|
602 |
|
|
|
|
|
|
|
|||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52,154 |
|
|
|
602 |
|
|||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52,154 |
|
|
|
602 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Ryan Miller |
|
5/23/2022 |
|
|
39,822 |
|
|
|
5,688 |
|
|
|
14.04 |
|
|
5/23/2032 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
5/23/2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
6,677 |
|
|
|
77 |
|
|
|
|
|
|
|
|||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
9,853 |
|
|
|
114 |
|
|
|
|
|
|
|
|||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,780 |
|
|
|
171 |
|
|||||
|
|
3/21/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11,048 |
|
|
|
128 |
|
|||||
|
|
2/27/2024 |
|
|
17,438 |
|
|
|
12,562 |
|
|
|
3.73 |
|
|
2/27/2034 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
15,306 |
|
|
|
177 |
|
|
|
|
|
|
|
|||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,306 |
|
|
|
177 |
|
|||||
|
|
3/18/2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,306 |
|
|
|
177 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Charles Stroo |
|
11/27/2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
125,000 |
|
|
|
1,444 |
|
|
|
|
|
|
|
|||||
Option Exercises and Stock Vested in Fiscal Year 2025 Table
The following table sets forth, for each of the named executive officers, information with respect to the exercise of stock options and the vesting of restricted stock units during the year ended December 31, 2025.
|
|
Option Awards |
|
|
Stock Awards |
|
||||||||||
Named Executive Officer |
|
Number of Shares Acquired on Exercise |
|
|
Value Realized on Exercise |
|
|
Number of Shares Acquired on Vesting |
|
|
Value Realized on Vesting (1) |
|
||||
William E. Siwek |
|
|
— |
|
|
$ |
— |
|
|
|
70,513 |
|
|
$ |
73,620 |
|
Ryan Miller |
|
|
— |
|
|
|
— |
|
|
|
16,706 |
|
|
|
17,433 |
|
Charles Stroo |
|
|
— |
|
|
|
— |
|
|
|
62,500 |
|
|
|
1,563 |
|
79
Employment, Severance and Change of Control Agreements
The material terms of the employment agreements with our named executive officers are summarized below.
William E. Siwek. In May 2020, we entered into a second amended and restated employment agreement with Mr. Siwek for the position of President and Chief Executive Officer. Mr. Siwek’s 2025 base salary was $962,281, which is subject to review and adjustment in accordance with Company policy. During 2025, Mr. Siwek was eligible for an annual incentive bonus targeted at 110% of his base salary. Mr. Siwek is also eligible to participate in employee benefit plans generally available to all of our employees, subject to the terms of those plans.
Ryan Miller. In May 2022, we entered into an employment agreement with Mr. Miller for the position of Chief Financial Officer. Mr. Miller’s 2025 base salary was $561,081, which is subject to review and adjustment in accordance with Company policy. During 2025, Mr. Miller was eligible for an annual incentive bonus targeted at 75% of his base salary. Mr. Miller was also eligible to participate in employee benefit plans generally available to all of our employees, subject to the terms of those plans.
Charles Stroo. In November 2023, we entered into an employment agreement with Mr. Stroo for the position of Chief Operating Officer, Wind. Mr. Stroo’s 2025 base salary was $530,000, which is subject to review and adjustment in accordance with Company policy. During 2025, Mr. Stroo was eligible for an annual incentive bonus targeted at 65% of his base salary. Mr. Stroo was also eligible to participate in employee benefit plans generally available to all of our employees, subject to the terms of those plans.
Pursuant to the employment agreements, each of Messrs. Siwek, Miller, and Stroo are subject to standard confidentiality and nondisclosure, assignment of IP work product and post-termination noncompetition and non-solicitation of employees, consultants and customers covenants.
Involuntary Termination of Employment Not in Connection with a Change of Control. Pursuant to the employment agreements, in the event the applicable named executive officer is terminated by us without “cause” (as defined in such executive’s employment agreement) or the named executive officer resigns for “good reason” (as defined in such executive’s employment agreement), in each case subject to the delivery of a fully effective release of claims and continued compliance with applicable restrictive covenants, the named executive officer will be entitled to (i) a cash severance payment equal to 200% of the base salary for Mr. Siwek payable in 24 monthly installments, and 100% of the base salaries for Messrs. Miller and Stroo payable in 12 monthly installments, and (ii) if the named executive officer elects to continue health benefits coverage, then 24 monthly cash payments equal to our monthly contribution for health insurance for Mr. Siwek, 12 monthly cash payments equal to our monthly contribution for health insurance for Messrs. Miller and Stroo.
Involuntary Termination of Employment in Connection with a Change of Control. In the event a named executive officer is terminated by us without cause or resigns for good reason, in each case within 12 months following a change in control (as defined in such executive’s employment agreement), subject to the delivery of a fully effective release of claims and continued compliance with applicable restrictive covenants, the named executive officer will not be entitled to the severance benefits described above, but will instead be entitled to the following: (i) a lump sum cash severance payment equal to 200% of the base salary and annual target bonus of Mr. Siwek, and 100% of the base salaries and annual target bonuses of each of the other named executive officers, (ii) if the named executive officer elects to continue health benefits coverage, up to 24 monthly cash payments equal to our monthly contribution for health insurance for Mr. Siwek, and up to 12 monthly cash payments equal to our monthly contribution for health insurance for any of the other named executive officers, (iii) the prorated portion of the annual target bonus for the current calendar year that the named executive officer would have been paid if he had remained employed through the applicable calendar year; and (iv) for all outstanding and unvested equity awards of the Company subject to time-based vesting held by the executives, full accelerated vesting of such awards, with a post-termination exercise period, if applicable, of one year.
With respect to TSR PSUs, in the event of a “change in control” (as defined in the applicable award agreement), the compensation committee shall determine the number of TSR PSUs credited by multiplying the named executive officer’s target award by the performance multiplier, which is determined based on the Company’s
80
total shareholder return percentile rank amongst the companies in the defined index during the period starting on January 1st of the year the award was granted through the change of control date, and such earned award shall become vested on the last day of the performance measurement period, subject to the named executive officer’s continuous service through such date. If in the change in control: (i) outstanding equity awards will be assumed, substituted or continued by the Company or its successor, and the named executive officer is (A) terminated by the Company or successor for any reason other than for “cause,” death or disability or (B) the named executive officer resigns for “good reason”, in either case within 12 months following the change in control and prior to the applicable vesting date; or (ii) outstanding equity awards will not be assumed, substituted or continued by the Company or its successor, then the TSR PSUs that were credited as of the day prior to the change in control will be deemed immediately vested on the date of such termination or change in control, as applicable.
With respect to our Adjusted EBITDA PSUs outstanding on December 31, 2025 in the event of a “change in control” (as defined in the applicable award agreement) prior to the last day of the applicable performance period, a number of Adjusted EBITDA PSUs equal to (i) the number of Adjusted EBITDA PSUs that would be earned with respect to the maximum level of Adjusted EBITDA achievement for the performance period in which the change in control occurs plus (ii) any Adjusted EBITDA PSUs earned in respect of Adjusted EBITDA achievement in the prior performance periods will become eligible to vest on the last day of the applicable three-year performance period, subject to the named executive officer’s continuous service through such date; provided, that if in connection with the change in control, (i) outstanding equity awards are or will be assumed, substituted or continued by the Company or its successor, and the applicable named executive officer is (A) terminated by the Company or successor for any reason other than for “cause” (as defined in the award agreement), or (B) the applicable named executive officer resigns for “good reason” (as defined in the award agreement), in either case within 12 months following the change in control and prior to the last day of the last yearly measurement period or (ii) outstanding equity awards are or will not be assumed, substituted or continued by the Company or its successor, then in either case, such earned Adjusted EBITDA PSUs shall immediately become vested on the date of such termination or change in control, as applicable.
Termination upon Death or Disability. If a named executive officer’s employment is terminated due to death or “disability” (as defined in the applicable award agreement), any TSR RSUs that have not vested as of such date shall automatically and without notice terminate and be forfeited unless the compensation committee otherwise determines, in its sole discretion, within three months following the date of termination, to accelerate all or any portion of such unvested TSR RSUs, and neither the named executive officer nor any of his or her successors, heirs, assigns, or personal representatives will thereafter have any further rights or interests in any unvested TSR RSUs.
If a named executive officer’s employment is terminated due to death or “disability” (as defined in the applicable award agreement), all unvested time-based RSUs will be deemed immediately vested on such date.
If a named executive officer’s employment is terminated due to death or “disability” (as defined in the applicable award agreement), a pro-rata portion (based on days of service during the current performance period) of the Adjusted EBITDA PSUs assuming the maximum level of performance is achieved during the current performance period plus any Adjusted EBITDA PSUs earned in prior performance periods will be deemed immediately vested on such date.
The Company may terminate each named executive officer’s employment for cause by a vote of the Board at a meeting of the Board called and held for such purpose.
The payments and benefits provided under the employment agreements in connection with a change in control may not be eligible for federal income tax deduction for the Company pursuant to Section 280G of the Code. These payments and benefits may also be subject to an excise tax under Section 4999 of the Code. If the payments or benefits payable to each named executive officer in connection with a change in control would be subject to the excise tax imposed under Section 4999 of the Code, then those payments or benefits will be reduced if such reduction would result in a higher net after-tax benefit to the executive.
81
Director Compensation
The following table provides a summary of the compensation provided to our directors under our non-employee director compensation policy:
Board of Directors |
|
Annual Fee |
|
|
All non-employee members |
|
$ |
80,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Annual Fees |
|
|
Chairperson of the board of directors |
|
$ |
65,000 |
|
Lead independent director |
|
|
25,000 |
|
Audit committee chair |
|
|
20,000 |
|
Audit committee member |
|
|
12,500 |
|
Compensation committee chair |
|
|
15,000 |
|
Compensation committee member |
|
|
7,500 |
|
Nominating and corporate governance committee chair |
|
|
12,500 |
|
Nominating and corporate governance committee member |
|
|
7,500 |
|
In addition, upon initial appointment to the Board, each non-employee director will receive an option award with a grant date fair value of $60,000, which will vest annually over four years (25% per year), subject to the director continuing to be a service provider to us through each applicable vesting date. On the date of each annual meeting of stockholders, each non-employee director who will continue as a member of the Board following such annual meeting of stockholders will be entitled to receive a restricted stock unit award with a grant date fair value of approximately $135,000 (the “annual grant”), which award will vest in full on the earlier of the first anniversary of the grant date or the next annual meeting of stockholders, subject to the director continuing to be a service provider to us through the vesting date. If a non-employee director joins the Board on a date other than the date of our annual meeting of stockholders, then, upon joining the Board, such director will be entitled to receive a pro-rata portion of the annual grant based on the time between such director’s appointment and the next annual meeting of stockholders, on the first eligible grant date following such director’s appointment to the Board.
In the event of a “sale event” (as defined in the 2015 Plan), the then-outstanding and unvested equity awards held by the non-employee directors that were granted pursuant to the amended and restated non-employee director compensation policy will become 100% vested.
We reimburse all reasonable out-of-pocket expenses incurred by non-employee directors in attending meetings of the Board or any committee thereof.
Our non-employee director compensation policy also provides that, pursuant to the 2015 Plan, the aggregate amount of compensation, including both equity compensation and cash compensation, paid to any non-employee director in a calendar year will not exceed $750,000 (or such other limit as may be set forth in the 2015 Plan or any similar provision of a successor plan).
Non-Employee Directors’ Deferred Compensation Program
In February 2024, we implemented a Non-Employee Directors’ Deferred Compensation Program to offer our non-employee directors the ability to defer the receipt of any restricted stock units granted to them from annual grants under the 2015 Plan. In advance of an award of restricted stock units and in compliance with the program’s requirements, a non-employee director may elect to defer the receipt of all of his or her restricted stock units until the earliest of (i) the date such non-employee director ceases to serve as a member of our board of directors and incurs a separation from service; (ii) the consummation of a “sale event”; (iii) the non-employee director’s death; or (iv) the date of non-employee director experiences a disability (such earliest date, the “Payment Event”). Upon the vesting of the restricted stock units, any amounts that would otherwise have been paid in shares of our common stock will be converted into deferred stock units (“DSUs”) on a one-to-one basis and credited to the non-employee director’s deferral account. The DSUs will be paid in shares of our common stock on a one-to-one basis in a single lump sum (and will cease to be held in the non-employee director’s deferred account) as soon as practicable, but in no event later than 30 days, following the Payment Event.
82
The following table presents the total compensation for each person who served as a member of the Board during the fiscal year ended December 31, 2025. William E. Siwek, who is our Chief Executive Officer, was an employee during the fiscal year ended December 31, 2025 and received no additional compensation for his service as a member of the Board. The compensation received by Mr. Siwek, as a named executive officer of the Company, is presented in the “Executive Compensation – Summary Compensation Table.”
Director Name |
|
Fees Earned or Paid in Cash |
|
|
Stock Awards |
|
|
Option Awards |
|
|
Total |
|
||||
Steven C. Lockard |
|
$ |
145,000 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
145,000 |
|
Paul G. Giovacchini |
|
|
127,500 |
|
|
|
— |
|
|
|
— |
|
|
|
127,500 |
|
Jayshree S. Desai |
|
|
80,000 |
|
|
|
— |
|
|
|
— |
|
|
|
80,000 |
|
Tyrone M. Jordan |
|
|
101,250 |
|
|
|
— |
|
|
|
— |
|
|
|
101,250 |
|
Bavan M. Holloway |
|
|
110,000 |
|
|
|
— |
|
|
|
— |
|
|
|
110,000 |
|
Neal P. Goldman (1) |
|
|
360,000 |
|
|
|
— |
|
|
|
— |
|
|
|
360,000 |
|
Timothy R. Pohl (1) |
|
|
360,000 |
|
|
|
— |
|
|
|
— |
|
|
|
360,000 |
|
James A. Hughes (2) |
|
|
75,000 |
|
|
|
— |
|
|
|
— |
|
|
|
75,000 |
|
Jennifer E. Lowry (2) |
|
|
28,125 |
|
|
|
— |
|
|
|
— |
|
|
|
28,125 |
|
Edward C. Hall (2) |
|
|
25,000 |
|
|
|
— |
|
|
|
— |
|
|
|
25,000 |
|
Compensation Committee Interlocks and Insider Participation
None of the members of the compensation committee has been an officer or employee of our Company during the last fiscal year. None of our executive officers currently serve, or in the past year have served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on the Board or compensation committee.
83
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information with respect to the beneficial ownership of our common stock as of March 1, 2026 for:
We have determined beneficial ownership in accordance with the rules of the SEC, and therefore it represents sole or shared voting or investment power with respect to our securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to community property laws where applicable. We have deemed shares of our common stock subject to options, restricted stock units and performance-based restricted stock units outstanding as of March 1, 2026 that were exercisable or issuable or will become exercisable or issuable within 60 days of March 1, 2026 to be outstanding and to be beneficially owned by the person holding the options, restricted stock units or performance-based restricted stock units for the purpose of computing the percentage ownership of that person but have not treated them as outstanding for the purpose of computing the percentage ownership of any other person.
We have based percentage ownership of our common stock on 48,765,812 shares of our common stock outstanding as of March 1, 2026.
Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o TPI Composites, Inc., 9200 E. Pima Center Parkway, Suite 250, Scottsdale, AZ 85258.
Named Executive Officers and Directors |
|
Number of Shares Beneficially Owned |
|
|
Percentage of Shares Beneficially Owned |
|
||
William E. Siwek |
|
|
639,718 |
|
|
|
1.3 |
% |
Ryan Miller |
|
|
85,729 |
|
|
* |
|
|
Charles Stroo |
|
|
92,975 |
|
|
* |
|
|
Steven C. Lockard |
|
|
441,873 |
|
|
* |
|
|
Jayshree S. Desai |
|
|
75,351 |
|
|
* |
|
|
Tyrone M. Jordan |
|
|
40,324 |
|
|
* |
|
|
Paul G. Giovacchini |
|
|
115,934 |
|
|
* |
|
|
Bavan M. Holloway |
|
|
58,558 |
|
|
* |
|
|
Neal Goldman |
|
|
— |
|
|
* |
|
|
Timothy Pohl |
|
|
— |
|
|
* |
|
|
All directors and named executive officers as a group (10 persons) |
|
|
1,550,462 |
|
|
|
3.2 |
|
|
|
|
|
|
|
|
||
5% Stockholders |
|
|
|
|
|
|
||
Investment funds and entities affiliated with: |
|
|
|
|
|
|
||
Dere Construction |
|
|
11,999,541 |
|
|
|
24.6 |
% |
Oaktree |
|
|
4,600,642 |
|
|
|
9.4 |
|
* Less than one percent (1%)
84
Equity Compensation Plan Information
The following table presents information as of December 31, 2025 for our equity compensation plans approved by our stockholders. We do not have any equity compensation plans that have not been approved by our stockholders.
Plan Category |
|
(a) Number of securities to be issued upon exercise of outstanding options, warrants and rights |
|
|
(b) Weighted-average exercise price of outstanding options, warrants and rights |
|
|
(c) Number of securities remaining available for future issuance under equity compensation plans (Excluding securities reflected in column (a)) |
|
|||
Equity compensation plans |
|
|
497,909 |
|
|
$ |
17.12 |
|
|
|
1,940,059 |
|
Equity compensation plans not |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total |
|
|
497,909 |
|
|
$ |
17.12 |
|
|
|
1,940,059 |
|
85
Certain Relationships and Transactions
Other than the transactions discussed below and the compensation agreements, equity compensation policies, grants of certain equity awards and other arrangements which are discussed above in the “Executive Compensation” section in 2025, there was not, and there is not currently proposed, any transaction or series of similar transactions to which we were or will be a party for which the amount involved exceeds or will exceed $120,000 and in which any director, executive officer, holder of 5% or more of any class of our capital stock or any member of their immediate family had or will have a direct or indirect material interest.
Other Transactions
We have granted stock options and other equity awards to our executive officers and our directors. See the sections titled “Outstanding Equity Awards at Fiscal 2025 Year-End” and “Director Compensation” for a description of these options and equity awards.
We have entered into arrangements with certain of our executive officers that, among other things, provide for certain severance and change in control benefits.
Indemnification of Officers and Directors
Our Certificate of Incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for the following:
Any amendment to, or repeal of, these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to that amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.
In addition, we have adopted amended and restated by-laws which provide that we will indemnify, to the fullest extent permitted by law, any person who is or was a party or is threatened to be made a party to any action, suit or proceeding by reason of the fact that he or she is or was one of our directors or officers or is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise. Our amended and restated by-laws provide that we may indemnify to the fullest extent permitted by law any person who is or was a party or is threatened to be made a party to any action, suit, or proceeding by reason of the fact that he or she is or was one of our employees or agents or is or was serving at our request as an employee or agent of another corporation, partnership, joint venture, trust, or other enterprise. Our amended and restated by-laws also provide that we must advance expenses incurred by or on behalf of a director or officer in advance of the final disposition of any action or proceeding, subject to very limited exceptions.
We have entered into indemnification agreements with each of our directors and executive officers that may be broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements require us, among other things, to indemnify our directors and executive officers against liabilities that may arise by reason of their status or service. These indemnification agreements also require us to advance all expenses incurred by the directors and executive officers in investigating or defending any such action,
86
suit, or proceeding. We believe that these agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers.
The limitation of liability and indemnification provisions that are included in our Certificate of Incorporation, amended and restated by-laws, and in indemnification agreements that we enter into with our directors and executive officers may discourage stockholders from bringing a lawsuit against our directors and executive officers for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against our directors and executive officers, even though an action, if successful, might benefit us and other stockholders. Further, a stockholder’s investment may be harmed to the extent that we pay the costs of settlement and damage awards against directors and executive officers as required by these indemnification provisions. At present, we are not aware of any pending litigation or proceeding involving any person who is or was one of our directors, officers, employees or other agents or is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, for which indemnification is sought, and we are not aware of any threatened litigation that may result in claims for indemnification.
We have obtained insurance policies under which, subject to the limitations of the policies, coverage is provided to our directors and executive officers against loss arising from claims made by reason of breach of fiduciary duty or other wrongful acts as a director or executive officer, including claims relating to public securities matters, and to us with respect to payments that may be made by us to these directors and executive officers pursuant to our indemnification obligations or otherwise as a matter of law.
Certain of our non-employee directors may, through their relationships with their employers or affiliated entities, be insured or indemnified against certain liabilities incurred in their capacity as members of the Board. In our indemnification agreements with these non-employee directors, we have agreed that our indemnification obligations will be primary to any such other indemnification arrangements.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
Procedures for Approval of Related Party Transactions
The audit committee of the Board has the primary responsibility for reviewing and approving or disapproving “related party transactions,” which are transactions between us and related persons in which the aggregate amount involved exceeds or may be expected to exceed $120,000 and in which a related person has or will have a direct or indirect material interest. For purposes of this policy, a related person is defined as a director, executive officer, nominee for director or greater than 5% beneficial owner of our common stock, in each case since the beginning of the most recently completed year, and their immediate family members. Our audit committee charter provides that the audit committee shall review and approve or disapprove any related party transactions.
Director Independence
See “Item 10. Directors, Executive Officers and Corporate Governance-Corporate Governance and Board Structure” and “Item 10. Directors, Executive Officers and Corporate Governance-Board Committees.”
87
Item 14. Principal Accountant Fees and Services
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm
We have adopted a policy under which the audit committee must pre-approve all audit and permissible non-audit services to be provided by the independent registered public accounting firm. As part of its review, the audit committee also considers whether the categories of pre-approved services are consistent with the rules on accountant independence of the SEC and the Public Company Accounting Oversight Board. The audit committee pre-approved all services performed since the pre-approval policy was adopted. This policy is set forth in our audit committee’s charter, which is available on our website at https://ir.tpicomposites.com/websites/tpicomposites/English/4300/governance-documents.html.
Fees for Services Rendered by Independent Registered Public Accounting Firm
Our independent registered public accounting firm is
The following table sets forth the fees billed by KPMG for audit, audit-related, tax and all other services rendered for fiscal years 2024 and 2025:
Fee Category |
|
2025 |
|
|
2024 |
|
||
Audit Fees |
|
$ |
2,004,500 |
|
|
$ |
3,068,500 |
|
Audit-Related Fees |
|
|
— |
|
|
|
— |
|
Tax Fees |
|
|
495,400 |
|
|
|
547,400 |
|
All Other Fees |
|
|
— |
|
|
|
— |
|
Total |
|
$ |
2,499,900 |
|
|
$ |
3,615,900 |
|
Audit Fees. Consist of professional services rendered in connection with the audit of our annual consolidated financial statements, including audited financial statements presented in our Annual Report and services that are normally provided by the independent registered public accountants in connection with statutory and regulatory filings or engagements for those fiscal years.
Audit-Related Fees. Consist of aggregate fees for accounting consultations and other services that were reasonably related to the performance of audits or reviews of our consolidated financial statements and were not reported above under “Audit Fees.”
Tax Fees. Consist of aggregate fees for tax compliance, tax advice and tax planning services including the review and preparation of our federal and state income tax returns and were approved by the audit committee.
All Other Fees. Consist of aggregate fees billed for products and services provided by the independent registered public accounting firm other than those disclosed above, of which there were none in 2024 or 2025.
88
PART IV
Item 15. Exhibits and Financial Statement Schedules
The financial statements listed in the accompanying Index to Consolidated Financial Statements are filed as part of this Annual Report on Form 10-K. All financial statement schedules have been omitted as the required information is not applicable or is not material to require presentation of the schedule, or because the information required is included in the Consolidated Financial Statements and notes thereto of this Annual Report on Form 10-K.
See Exhibit Index.
Item 16. Form 10-K Summary
Not applicable.
89
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
|
|
Page |
Report of Independent Registered Public Accounting Firm |
|
F-2 |
Consolidated Balance Sheets as of December 31, 2025 and 2024 |
|
F-4 |
Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023 |
|
F-5 |
Consolidated Statements of Comprehensive Loss for the years ended December 31, 2025, 2024 and 2023 |
|
F-6 |
Consolidated Statements of Changes in Stockholders’ Deficit for the years ended December 31, 2025, 2024 and 2023 |
|
F-7 |
Consolidated Statements of Cash Flows for the years ended December 31, 2025, 2024 and 2023 |
|
F-8 |
Notes to Consolidated Financial Statements |
|
F-10 |
F-1
Report of Independent Registered Public Accounting Firm
To the Stockholders and Board of Directors
TPI Composites, Inc.:
Opinion on the Consolidated Financial Statements
We have audited the accompanying consolidated balance sheets of TPI Composites, Inc. and subsidiaries (the Company) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive loss, changes in stockholders’ deficit, and cash flows for each of the years in the three-year period ended December 31, 2025, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has incurred significant operating losses and negative cash flows from operations in recent years. In addition, the Company filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code in the Bankruptcy Court, which is an event of default that accelerated the Company's debt obligations. These events and conditions raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these 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
F-2
statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a 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.
Evaluation of estimates of direct costs to complete performance obligations for wind blade sales
As discussed in Notes 1 and 5 to the consolidated financial statements, the Company generates the majority of its revenue from contracts associated with manufacturing custom wind blades. Revenue from manufacturing wind blades is primarily recognized over time based on progress towards the completion of the performance obligation in the contract. Progress is determined by the ratio of direct costs incurred to date in fulfillment of the performance obligation to the total estimated direct costs required to complete the performance obligation. Wind blade sales from continuing operations was $869.9 million compared to total net sales of $918.5 million in fiscal 2025.
We identified the evaluation of estimated direct costs to complete performance obligations for wind blade sales as a critical audit matter. Evaluating this estimate required a high degree of auditor judgment as changes in the estimate could have had a significant effect on the Company’s revenue. Each wind blade contract requires the measure of progress that includes estimates of direct costs to complete the performance obligations.
The following are the primary procedures we performed to address this critical audit matter. We evaluated the Company’s ability to estimate direct costs to complete the performance obligations by comparing to historical results. We evaluated the impact of future cost drivers on the estimated direct cost amounts by inspecting relevant third-party documents. Further, we evaluated historical direct labor cost by wind blade type and manufacturing plant, and analyzed jurisdiction-specific inflation rates based on publicly available data. We assessed current period revenue based upon the estimated consideration, the ratio of direct costs incurred to date in fulfillment of the performance obligations to the total estimated direct costs required to complete the performance obligations, and revenue recognized in previous periods for the performance obligations.
/s/ KPMG LLP
We have served as the Company’s auditor since 2008.
March 25, 2026
F-3
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
CONSOLIDATED BALANCE SHEETS
|
|
December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
|
|
(In thousands, except par value data) |
|
|||||
Assets |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Restricted cash |
|
|
|
|
|
|
||
Accounts receivable |
|
|
|
|
|
|
||
Contract assets |
|
|
|
|
|
|
||
Prepaid expenses |
|
|
|
|
|
|
||
Other current assets |
|
|
|
|
|
|
||
Inventories |
|
|
|
|
|
|
||
Assets held for sale |
|
|
|
|
|
|
||
Current assets of discontinued operations |
|
|
|
|
|
|
||
Total current assets |
|
|
|
|
|
|
||
Property, plant and equipment, net |
|
|
|
|
|
|
||
Operating lease right of use assets |
|
|
|
|
|
|
||
Goodwill |
|
|
|
|
|
|
||
Intangible assets and deferred costs, net |
|
|
|
|
|
|
||
Other noncurrent assets |
|
|
|
|
|
|
||
Other noncurrent assets of discontinued operations |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Liabilities and Stockholders’ Deficit |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Debtor-in-possession financing |
|
$ |
|
|
$ |
|
||
Accounts payable and accrued expenses |
|
|
|
|
|
|
||
Accrued warranty |
|
|
|
|
|
|
||
Current maturities of long-term debt, net of debt discounts |
|
|
|
|
|
|
||
Current operating lease liabilities |
|
|
|
|
|
|
||
Contract liabilities |
|
|
|
|
|
|
||
Current liabilities of discontinued operations |
|
|
|
|
|
|
||
Total current liabilities |
|
|
|
|
|
|
||
Long-term debt, net of current maturities |
|
|
|
|
|
|
||
Noncurrent operating lease liabilities |
|
|
|
|
|
|
||
Other noncurrent liabilities |
|
|
|
|
|
|
||
Other noncurrent liabilities of discontinued operations |
|
|
|
|
|
|
||
Total liabilities not subject to compromise |
|
|
|
|
|
|
||
Liabilities subject to compromise |
|
|
|
|
|
|
||
Total liabilities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|||
Stockholders’ deficit: |
|
|
|
|
|
|
||
Common shares, $ |
|
|
|
|
|
|
||
Paid-in capital |
|
|
|
|
|
|
||
Accumulated other comprehensive income (loss) |
|
|
|
|
|
( |
) |
|
Accumulated deficit |
|
|
( |
) |
|
|
( |
) |
Treasury stock, at cost, |
|
|
( |
) |
|
|
( |
) |
Total stockholders’ deficit |
|
|
( |
) |
|
|
( |
) |
Total liabilities and stockholders’ deficit |
|
$ |
|
|
$ |
|
||
See accompanying notes to consolidated financial statements.
F-4
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(In thousands, except per share data) |
|
|||||||||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of sales |
|
|
|
|
|
|
|
|
|
|||
Startup and transition costs |
|
|
|
|
|
|
|
|
|
|||
Total cost of goods sold |
|
|
|
|
|
|
|
|
|
|||
Gross loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|||
Loss on sale of assets and asset impairments |
|
|
|
|
|
|
|
|
|
|||
Restructuring charges, net |
|
|
|
|
|
|
|
|
|
|||
Loss from continuing operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense, net |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Foreign currency loss |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Miscellaneous income |
|
|
|
|
|
|
|
|
|
|||
Total other expense |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Reorganization items, net |
|
|
|
|
|
|
|
|
|
|||
Loss from continuing operations before income taxes |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Income tax provision |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net loss from continuing operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Preferred stock dividends and accretion |
|
|
|
|
|
|
|
|
( |
) |
||
Gain on extinguishment of Series A Preferred Stock |
|
|
|
|
|
|
|
|
|
|||
Net loss from continuing operations attributable |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net loss from discontinued operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net loss attributable to common stockholders |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Weighted-average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
|
|
|
|
|
|
|
|
|||
Diluted |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Net loss from continuing operations per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Net (loss) income from discontinued operations per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Net loss per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
See accompanying notes to consolidated financial statements.
F-5
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(In thousands) |
|
|||||||||
Net loss from continuing operations |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Net loss from discontinued operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net loss attributable to common stockholders |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other comprehensive loss: |
|
|
|
|
|
|
|
|
|
|||
Foreign currency translation adjustments |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Unrecognized actuarial losses |
|
|
|
|
|
( |
) |
|
|
|
||
Amortization of unrecognized actuarial losses |
|
|
|
|
|
|
|
|
|
|||
Unrealized gain (loss) on hedging derivatives, net of taxes of |
|
|
|
|
|
( |
) |
|
|
|
||
Reclassification of loss on hedging derivatives, |
|
|
|
|
|
|
|
|
|
|||
Reclassification of other comprehensive losses |
|
|
|
|
|
|
|
|
|
|||
Comprehensive loss |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
See accompanying notes to consolidated financial statements.
F-6
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
|
|
Series A Preferred Stock |
|
|
|
Common |
|
|
Paid-in |
|
|
Accumulated other comprehensive |
|
|
Accumulated |
|
|
Treasury stock, |
|
|
Total stockholders' |
|
|||||||||||||||
|
|
Shares |
|
|
Amount |
|
|
|
Shares |
|
|
Amount |
|
|
capital |
|
|
loss |
|
|
deficit |
|
|
at cost |
|
|
(deficit) equity |
|
|||||||||
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|||||||||||||||||||||||||||
Balance at December 31, 2022 |
|
|
|
|
|
|
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
||||||
Net loss |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Preferred stock dividends |
|
|
— |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
Other comprehensive |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Common stock |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Issuances under |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Share-based compensation |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Issuance of common |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Accretion of Series A |
|
|
— |
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
Capped call transactions |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Extinguishment of |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||||
Balance at December 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|||||
Net loss |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Other comprehensive |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
Common stock |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Issuances under |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Share-based compensation |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Balance at December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|||||
Net loss |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Other comprehensive |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Common stock |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Issuances under |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Share-based compensation |
|
|
— |
|
|
|
— |
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
||
Balance at December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
||||||
See accompanying notes to consolidated financial statements.
F-7
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(In thousands) |
|
|||||||||
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
|||
Net loss |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Provision for credit losses |
|
|
|
|
|
|
|
|
|
|||
Loss on sale of assets and asset impairments |
|
|
|
|
|
|
|
|
|
|||
(Gain) loss on sale of discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
||
Share-based compensation expense |
|
|
|
|
|
|
|
|
|
|||
Amortization of debt issuance costs and debt discount |
|
|
|
|
|
|
|
|
|
|||
Paid in kind interest |
|
|
|
|
|
|
|
|
|
|||
Deferred income taxes |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Reorganization items, net |
|
|
( |
) |
|
|
|
|
|
|
||
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
|
|||
Accounts receivable |
|
|
|
|
|
( |
) |
|
|
|
||
Contract assets and liabilities |
|
|
|
|
|
|
|
|
|
|||
Operating lease right of use assets and operating lease liabilities |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Inventories |
|
|
( |
) |
|
|
|
|
|
|
||
Prepaid expenses |
|
|
( |
) |
|
|
|
|
|
|
||
Other current assets |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Other noncurrent assets |
|
|
( |
) |
|
|
|
|
|
|
||
Accounts payable and accrued expenses |
|
|
|
|
|
|
|
|
( |
) |
||
Accrued warranty |
|
|
|
|
|
|
|
|
|
|||
Other noncurrent liabilities |
|
|
|
|
|
( |
) |
|
|
|
||
Net cash provided by (used in) operating activities |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Restricted cash transferred upon sale of business |
|
|
( |
) |
|
|
|
|
|
|
||
Proceeds from sale of business |
|
|
|
|
|
|
|
|
|
|||
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
|||
Proceeds from DIP financing |
|
|
|
|
|
|
|
|
|
|||
Payments of DIP financing costs |
|
|
( |
) |
|
|
|
|
|
|
||
Proceeds from working capital loans |
|
|
|
|
|
|
|
|
|
|||
Repayments of working capital loans |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Principal repayments of finance leases |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net proceeds from (repayments of) other debt |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Proceeds from issuance of convertible notes |
|
|
|
|
|
|
|
|
|
|||
Purchase of capped calls |
|
|
|
|
|
|
|
|
( |
) |
||
Payments of debt issuance costs |
|
|
|
|
|
|
|
|
( |
) |
||
Repurchase of common stock including shares withheld in lieu of income |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net cash provided by (used in) financing activities |
|
|
( |
) |
|
|
|
|
|
|
||
Impact of foreign exchange rates on cash, cash equivalents and restricted cash |
|
|
|
|
|
( |
) |
|
|
|
||
Net change in cash, cash equivalents and restricted cash |
|
|
( |
) |
|
|
|
|
|
|
||
Cash, cash equivalents and restricted cash, beginning of year |
|
|
|
|
|
|
|
|
|
|||
Cash, cash equivalents and restricted cash, end of year |
|
$ |
|
|
$ |
|
|
$ |
|
|||
See accompanying notes to consolidated financial statements.
F-8
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
CONSOLIDATED STATEMENTS OF CASH FLOWS – CONTINUED
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
|
|||
Cash paid for interest |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cash paid for income taxes, net of refunds |
|
|
|
|
|
|
|
|
|
|||
Cash paid for professional fees for services related to bankruptcy proceedings |
|
|
|
|
|
|
|
|
|
|||
Cash paid for professional fees for services related to restructuring |
|
|
|
|
|
|
|
|
|
|||
Noncash investing and financing activities: |
|
|
|
|
|
|
|
|
|
|||
Right of use assets obtained in exchange for new operating |
|
|
|
|
|
|
|
|
|
|||
Property, plant, and equipment obtained in exchange for new |
|
|
|
|
|
|
|
|
|
|||
Accrued capital expenditures in accounts payable |
|
|
|
|
|
|
|
|
|
|||
DIP roll-up loan |
|
|
|
|
|
|
|
|
|
|||
Paid in kind DIP interest and commitment fees |
|
|
|
|
|
|
|
|
|
|||
Paid in kind preferred stock dividends and accretion |
|
|
|
|
|
|
|
|
|
|||
Issuance of Common Stock to extinguish |
|
|
|
|
|
|
|
|
|
|||
Issuance of debt, net of debt discount, |
|
|
|
|
|
|
|
|
|
|||
Accrued transaction costs in accounts |
|
|
|
|
|
|
|
|
|
|||
Reconciliation of Cash, Cash Equivalents and Restricted Cash: |
|
December 31, |
|
|||||||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|
2022 |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Restricted cash |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents of discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total cash, cash equivalents and restricted |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
See accompanying notes to consolidated financial statements.
F-9
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 1. Summary of Operations and Summary of Significant Accounting Policies
(a) Description of Business
TPI Composites, Inc. is the holding company that conducts substantially all of its business operations through its direct and indirect subsidiaries (collectively, the Company or we). The Company was founded in 1968 and has been producing composite wind blades since 2001. The Company is incorporated in Delaware, headquartered in Scottsdale, Arizona and has a strategic manufacturing footprint that includes domestic facilities in Newton, Iowa; Des Moines, Iowa; and Santa Teresa, New Mexico and international facilities in Juárez, Mexico; Matamoros, Mexico; Chennai, India; Kolding, Denmark; Berlin, Germany and Madrid, Spain.
On August 11, 2025, (the “Petition Date”), TPI Composites, Inc. (the “Company”) and its direct and indirect subsidiaries incorporated in the United States (such subsidiaries, together with the Company, collectively, the “Company Parties” or the “Debtors”) each filed voluntary petitions for relief under chapter 11 of title 11 of the United States Bankruptcy Code (the “Bankruptcy Code” and such cases, the “Chapter 11 Cases”) in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). The Chapter 11 Cases are being jointly administered for procedural purposes only under the caption “In re TPI Composites, Inc., et al” Case No. 25-34655.
The Chapter 11 Cases were filed in order to facilitate a financial and operational restructuring of the Company’s business and balance sheet. The Debtors also filed a motion seeking approval of procedures for the sale of all or any of the Debtors’ assets pursuant to section 363 of the Bankruptcy Code. The Debtors continue to operate their businesses as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. In general, as debtors-in-possession under the Bankruptcy Code, the Debtors are authorized to continue to operate as an ongoing business but may not engage in transactions outside the ordinary course of business without the prior approval of the Bankruptcy Court. For additional information regarding the Chapter 11 Cases, see Note 2 – Bankruptcy Proceedings.
On September 10, 2025, following the satisfactory completion of the closing conditions, including the approval of the Bankruptcy Court, the Company consummated the sale and transfer of
In June 2024, we completed the divestiture of our wholly-owned subsidiary, TPI, Inc. (the Automotive subsidiary). The Automotive subsidiary was engaged in the development, commercialization and implementation of the Company’s automotive industry related products. The divestiture constituted a strategic shift as the Company is focusing entirely on executing on its core business in the wind industry, and accordingly, the historical results of our Automotive subsidiary have been presented as discontinued operations in our consolidated statements of operations and consolidated balance sheets.
The following discussion reflects continuing operations only, unless otherwise indicated. For further information regarding our discontinued operations, refer to Note 4 – Discontinued Operations.
(b) Basis of Presentation
The accompanying consolidated financial statements include the accounts of TPI Composites, Inc. and all majority owned subsidiaries. All significant intercompany transactions and balances have been eliminated. Certain
F-10
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
prior period amounts in the consolidated financial statements and accompanying notes have been reclassified to conform to the current period’s presentation.
(c) Bankruptcy Accounting
As a result of the Chapter 11 Cases, the Company has applied the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 852, Reorganization (“ASC 852”), in preparing the accompanying consolidated financial statements. ASC 852 requires that, for periods including and after the filing of the voluntary petitions, the consolidated financial statements distinguish transactions and events that are directly associated with the reorganization from the ongoing operations of the business. Accordingly, for the period beginning after the Petition Date, pre-petition unsecured and undersecured claims related to the Debtors that may be impacted by the Chapter 11 Cases have been classified as liabilities subject to compromise in the consolidated balance sheets. Liabilities subject to compromise include pre-petition liabilities for which there is uncertainty about whether such pre-petition liabilities could be impaired as a result of the Chapter 11 Cases. Liabilities subject to compromise are recorded at the expected amount of the total allowed claim, even if they may ultimately be settled for different amounts. In addition, expenses that are incurred or realized as a result of the Chapter 11 Cases are classified as reorganization items, net in the consolidated statements of operations and comprehensive loss. See Note 2 – Bankruptcy Proceedings for additional information.
(d) Going Concern
In accordance with ASC 205-40, Presentation of Financial Statements – Going Concern, we evaluate at each period end whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.
Our consolidated financial statements have been prepared assuming we will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company has incurred significant operating losses and negative cash flows from operations in recent years, resulting in unrestricted cash and cash equivalents of $
Further, as described in Note 2 – Bankruptcy Proceedings, on August 11, 2025, the Company filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code in the Bankruptcy Court, which is an event of default that accelerated our debt obligations. While the Company is actively undergoing a restructuring, there can be no assurance that such restructuring will be successfully implemented or that it will be sufficient to mitigate the financial conditions raising substantial doubt about our ability to continue as a going concern. As a result, substantial doubt exists that the Company will be able to continue as a going concern for a period of at least twelve months from the issuance date of this Annual Report on Form 10-K. The consolidated financial statements do not include any adjustments that may result from the outcome of this uncertainty.
(e) Nasdaq Delisting and Transfer to the Over-the-Counter (“OTC”) Market
On August 12, 2025, the Company received a letter from The Nasdaq Stock Market LLC (“Nasdaq”), notifying the Company that the Nasdaq staff had determined to commence proceedings to delist the Company’s common stock from Nasdaq as a result of the Company’s commencement of the Chapter 11 Cases. The Company did not request a hearing before the panel to appeal the Nasdaq staff’s determination. Accordingly, trading of the Company’s common stock, par value $
F-11
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(f) Revenue Recognition
The majority of our revenue is generated from supply agreements associated with manufacturing of wind blades and related services. We account for a supply agreement when it has the approval from both parties, the rights of the parties are identified, payment terms are established, the contract has commercial substance and the collectability of consideration is probable.
To determine the proper revenue recognition method for each supply agreement, we evaluate whether the original contract should be accounted for as one or more performance obligations. This evaluation requires judgment and the decisions reached could change the amount of revenue and gross profit recorded in a given period. As most of our contracts contain multiple performance obligations, we allocate the total transaction price to each performance obligation based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. Our manufacturing services are customer specific and involve production of items that cannot be sold to other customers due to the customers’ protected IP; therefore, we allocate the total transaction price under our contracts with multiple performance obligations using the contractually stated prices, as these prices represent the relative standalone selling price based on an expected cost-plus margin model.
Revenue is primarily recognized over time as we have an enforceable right to payment upon termination and we may not use or sell the product to fulfill other customers’ contracts. In addition, the customer does not have return or refund rights for items produced that conform to the specifications included in the contract. Because control transfers over time, revenue is recognized based on the extent of progress towards the completion of the performance obligation. We use the cost-to-cost input measure of progress for our contracts as this method provides the best representation of the production progress towards satisfaction of the performance obligation as the materials are distinct to the product being manufactured because of customer specifications provided for in the contract, the costs incurred are proportional to the progress towards completion of the product, and the products do not involve significant pre-fabricated component parts. Under the cost-to-cost method, progress and the related revenue recognition is determined by a ratio of direct costs incurred to date in fulfillment of the performance obligation to the total estimated direct costs required to complete the performance obligation.
Determining the revenue to be recognized for services performed under our supply agreements involves judgments and estimates relating to the total consideration to be received and the expected direct costs to complete the performance obligation. As such, revenue recognized reflects our estimates of future contract volumes and the direct costs to complete the performance obligation. The judgments and estimates relating to the total consideration to be received include the amount of variable consideration as our contracts typically provide the customer with a range of production output options from guaranteed minimum volume obligations to the production capacity of the facility, and customers will provide periodic non-cancellable commitments for the number of wind blades to be produced over the term of the agreement. The total consideration also includes payments expected to be received associated with wind blade model transitions, and payments expected to be received or paid in the form of liquidated damages, for missed production deadlines which are paid over a negotiated timeline. We use historical experience, customer commitments and forecasted future production based on the capacity of the plant to estimate the total revenue to be received to complete the performance obligation. In addition, the amount of consideration per unit produced may vary based on the costs of production of the wind blades as we may be able to change the price per unit based on changes in the cost of production. Further, some of our contracts provide opportunities for us to share in labor and material cost savings as well as absorb some additional costs as an incentive for more efficient production, both of which impact the margin realized on the contract and ultimately the total amount of revenue to be recognized.
We estimate variable consideration at the most likely amount to which we expect to be entitled. We include estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information available to us at the time of the estimate and may materially change as additional information becomes known.
Our contracts may be modified to account for changes in specifications of products and changing requirements. If the contract modifications are for goods or services that are not distinct from the existing contract, they are accounted for as if they were part of the original contract. The effect of a contract modification on the transaction price and the measure of progress for the performance obligation to which it relates is recognized as an
F-12
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
adjustment to revenue on a cumulative catch-up basis. If contract modifications are for goods and services that are distinct from the existing contract and increases the amount of consideration reflecting the standalone sale price of the additional goods or services, then the contract modification is accounted for as a separate contract and is evaluated for one or more performance obligations.
Each reporting period, we evaluate the progress towards satisfaction of each performance obligation based on any contract modifications that have occurred, costs incurred to date, and an estimate of the expected future consideration and costs to be incurred to complete the performance obligation. Based on this analysis, any changes in estimates of total consideration to be received and direct costs to complete the performance obligation are recognized on a cumulative catch-up basis, which recognizes in the current period the cumulative effect of the changes on current and prior periods based on the percentage of completion of the performance obligation.
Wind blade pricing is based on annual commitments of volume as established in our supply agreements and orders less than committed volume may result in a higher price per wind blade to our customers. Orders in excess of annual commitments may result in discounts to our customers from the contracted price for the committed volume. Our customers typically provide periodic purchase orders with the price per wind blade given the current cost of the bill of materials, labor requirements and volume desired. We record an allowance for expected utilization of early payment discounts which are reported as a reduction of the total consideration to be received.
Precision molding and assembly systems (“tooling”) included in a customer’s contract are based upon the specific engineering requirements and design determined by the customer and are specific to the wind blade design and function desired. From the customer’s engineering specifications, a job cost estimate is developed along with a production plan, and the desired margin is applied based on the location the work is to be performed and complexity of the customer’s design. Precision molding and assembly systems are generally built to produce wind blades which may be manufactured by us in production runs specified in the customer contract. We completed the divestiture of our tooling business in August 2025.
Contract assets primarily relate to our rights to consideration for work completed but not billed at the reporting date on supply agreements.
Our customers may request, in situations where they do not have space available to receive products or do not want to take possession of products immediately for other reasons, that their finished products be stored by us in one of our facilities. Most of our contracts provide for a limited number of wind blades to be stored during the period of the contract with any additional wind blades stored subject to additional storage fees, which are included in other wind related sales.
Revenue related to field service inspection and repair services, non-recurring engineering and freight services provided under our supply agreements is recognized at a point in time following the transfer of control of the promised services to the customer. Customers usually pay the carrier directly for the cost of shipping associated with items produced. When we pay the shipping cost, we apply the practical expedient that allows us to account for shipping and handling as fulfillment costs and include the revenue in the associated performance obligation and the costs are included in cost of goods sold.
Taxes assessed by a governmental authority that are both imposed on and concurrent with specific revenue-producing transactions, that are collected by us from a customer, are excluded from revenue.
F-13
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(g) Cost of Goods Sold
Cost of goods sold includes the costs we incur at our production facilities to make products saleable on both products invoiced during the period as well as products in progress towards the satisfaction of the related performance obligations for which we have an enforceable right to payment upon termination and we may not use or sell the product to fulfill other customers’ contracts. All costs incurred at our production facilities, as well as the allocated portion to our production facilities of costs incurred at our corporate headquarters and our research facilities, are directly or indirectly related to the manufacturing of products or services and are presented in cost of goods sold. Cost of goods sold includes such items as raw materials, direct and indirect labor and facilities costs, including purchasing and receiving costs, plant management, inspection costs, production process improvement activities, product engineering and internal transfer costs. In addition, all depreciation associated with assets used in the production of our products is also included in cost of goods sold. Direct labor costs consist of salaries, benefits and other personnel related costs for associates engaged in the manufacturing of our products and services.
Startup and transition costs are primarily unallocated fixed overhead costs and underutilized direct labor costs incurred during the period production facilities are transitioning wind blade models and ramping up manufacturing. All direct labor costs, excluding non-productive labor costs, are included in the measure of progress towards completion of the relevant performance obligation when determining revenue to be recognized during the period. The cost of sales for the initial products from a new model manufacturing line is generally higher than when the line is operating at optimal production volume levels due to inefficiencies during ramp-up related to labor hours per blade, cycle times per blade and raw material usage. Additionally, these costs as a percentage of net sales are generally higher during the period in which a facility is ramping up to full production capacity due to underutilization of the facility. Manufacturing overhead at each of our facilities includes virtually all indirect costs (including share-based compensation costs) incurred at the plants, including engineering, finance, information technology, human resources and plant management.
(h) General and Administrative Expenses
General and administrative expenses primarily relate to the unallocated portion of costs incurred at our corporate headquarters and our research facilities and include salaries, benefits and other personnel related costs for associates engaged in research and development, engineering, finance, internal audit, information technology, human resources, business development, global operational excellence, global supply chain, in-house legal and executive management. Other costs include outside legal and accounting fees, risk management (insurance), share-based compensation and certain other administrative and global resources costs.
The unallocated research and development expenses incurred at our Kolding, Denmark advanced engineering center and our Berlin, Germany engineering center are also included in general and administrative expenses. For the years ended December 31, 2025, 2024 and 2023, total research and development expenses totaled $
F-14
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(i) Loss on Sale of Assets and Asset Impairments
For the years ended December 31, 2025, 2024 and 2023, the losses on the sale of certain receivables, on a non-recourse basis under accounts receivable assignment agreements with our customers, to financial institutions, as well as the losses on the sale of other assets at our corporate and manufacturing facilities and asset impairment charges totaled $
(j) Restructuring Charges, Net
Restructuring charges primarily consist of associate severance, one-time termination benefits and ongoing benefits related to the reduction of our workforce and other costs associated with exit activities, which may include costs related to leased facilities to be abandoned and facility and associate relocation costs. The determination of when we accrue for involuntary termination benefits under restructuring plans depends on whether the termination benefits are provided under an ongoing benefit arrangement or under a one-time benefit arrangement. Ongoing benefit arrangements are recognized over the service period or when termination becomes reasonably probable, and one-time benefit arrangements are recognized in the period the arrangement is approved and formally communicated to associates. If applicable, we record such costs into operating expense over the terminated associate’s future service period beyond any minimum retention period. Restructuring charges that have been incurred but not yet paid are recorded in accrued expenses in the accompanying consolidated balance sheets.
For the years ended December 31, 2025, and 2024, restructuring charges, net totaled $
(k) Cash and Cash Equivalents and Restricted Cash
Cash and cash equivalents include highly liquid investments that are readily convertible to known amounts of cash with original maturities of three months or less. The carrying value of cash and cash equivalents approximates fair value.
As of December 31, 2025 and 2024, our discontinued operations collectively had unrestricted cash totaling $
As of December 31, 2025 and 2024, we had $
(l) Accounts Receivable
Trade accounts receivable are recorded at the invoiced amount and generally do not bear interest. We follow the allowance method of recognizing uncollectible accounts receivable, which recognizes bad debt expense based on a review of the individual accounts outstanding and prior history of uncollectible accounts receivable. Credit is extended based on evaluation of each of our customer’s financial condition and is generally unsecured. Accounts receivable are generally due within 30 days and are stated net of an allowance for doubtful accounts in the consolidated balance sheets. Accounts are considered past due if outstanding longer than contractual payment terms. We record an allowance based on consideration of a number of factors, including the length of time trade accounts are past due, previous loss history, the creditworthiness of individual customers, economic conditions affecting specific customer industries, and economic conditions in general. We write-off accounts receivable after all reasonable collection efforts have been exhausted. We credit payments subsequently received on such receivables to bad debt expense in the period payment is received. We record delinquent finance charges on outstanding accounts receivables only if they are collected. We do not have any off-balance-sheet credit exposure related to our customers. See Note 7 – Accounts Receivable.
F-15
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(m) Inventories
Inventories represent materials purchased that are not restricted to fulfillment of a specific contract and are measured at the lower of cost or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Cost is determined using the first-in, first-out method for such raw materials. Write-downs to reduce the carrying cost of obsolete, slow-moving, and unusable inventory to net realizable value are recognized in cost of goods sold. The effect of these write-downs establishes a new cost basis in the related inventory, which is not subsequently written up.
(n) Property, Plant and Equipment
Property, plant and equipment are stated at cost. Depreciation and amortization of property, plant, and equipment is calculated on the straight-line method over the estimated useful lives of the assets. See Note 9 – Property, Plant and Equipment, Net.
|
|
Estimated |
Machinery and equipment |
|
|
Buildings |
|
|
Leasehold improvements |
|
|
Office equipment and software |
|
|
Furniture |
|
|
Vehicles |
|
(o) Recoverability of Long-Lived Assets
We review property, plant and equipment and other long-lived assets in order to assess recoverability based on expected future undiscounted cash flows whenever events or circumstances indicate that the carrying value may not be recoverable. If the sum of the expected future net cash flows is less than the carrying value, an impairment loss is recognized. The impairment loss is measured as the amount by which the carrying value exceeds the fair value of the asset.
(p) Assets Held for Sale
We classify long-lived assets or disposal groups to be sold as held for sale in the period in which all of the following criteria are met: (1) management, having the authority to approve the action, commits to a plan to sell the asset or disposal group; (2) the asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets or disposal groups; (3) an active program to locate a buyer and other actions required to complete the plan to sell the asset or disposal group have been initiated; (4) the sale of the asset or disposal group is probable, and transfer of the asset or disposal group is expected to qualify for recognition as a completed sale within one year, except if events or circumstances beyond our control extend the period of time required to sell the asset or disposal group beyond one year; (5) the asset or disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and (6) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.
We initially measure a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any loss resulting from this measurement is recognized in the period in which the held-for-sale criteria are met. Conversely, gains are not recognized on the sale of a long-lived asset or disposal group until the date of sale. We assess the fair value of a long-lived asset or disposal group less any costs to sell each reporting period it remains classified as held for sale and report any subsequent changes as an adjustment to the carrying value of the asset or disposal group, as long as the new carrying value does not exceed the carrying value of the asset at the time it was initially classified as held for sale.
Upon determining that a long-lived asset or disposal group meets the criteria to be classified as held for sale, we cease depreciation and report long-lived assets and/or the assets and liabilities of the disposal group, if material, in the line items assets held for sale and liabilities held for sale, respectively, in our consolidated balance sheets.
F-16
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
As of December 31, 2024, we met the criteria to classify $
Under the Chapter 11 Cases, the Company is also pursuing a structured sale of substantially all of its assets pursuant to section 363 of the Bankruptcy Code. As of December 31, 2025, the Debtors continued to negotiate the terms of a sale transaction and any changes could have a material effect. Therefore, the Company concluded that the criteria was not met for classifying such assets subject to the ongoing section 363 sale process as held for sale as of December 31, 2025.
(q) Discontinued Operations
In determining whether a group of assets disposed (or to be disposed) of should be presented as a discontinued operation, the Company makes a determination of whether the criteria for held-for-sale classification is met and whether the disposition represents a strategic shift that has (or will have) a major effect on the entity’s operations and financial results. If these determinations can be made affirmatively, the results of operations of the group of assets being disposed of (as well as any gain or loss on the disposal transaction) are aggregated for separate presentation apart from continuing operating results of the Company in the consolidated financial statements. As of December 31, 2025, and 2024 we met the criteria to classify the disposal of certain of our former business operations as discontinued operations. See Note 4 – Discontinued Operations.
(r) Goodwill, Intangible Assets and Deferred Costs, Net
Goodwill, which is entirely in the U.S. segment, is evaluated for impairment annually on October 31 and whenever events or circumstances make it likely that impairment may have occurred. In determining whether impairment has occurred, we compare the fair value of the related reporting unit (calculated using the discounted cash flow method) to its carrying value. If the carrying value exceeds the fair value, impairment is recognized for the difference. We may first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test. We performed our annual goodwill impairment test during 2025 and determined that it is more-likely-than-not that its fair value exceeds its carrying amount.
Our patents, licenses, trademarks and development tools were acquired in business acquisitions and provide contractual or legal rights, or other future benefits that could be separately identified. Our valuation of identified intangible assets was based upon discounted cash flow estimates that require significant management judgment with respect to revenue and expense growth rates, changes in working capital, and the selection and use of the appropriate discount rate. The intangible assets are amortized over their estimated useful life. Intangible assets with indefinite lives are evaluated at least annually for impairment or whenever events or circumstances make it likely that impairment may have occurred.
In addition, we recognize an asset for deferred costs incurred to fulfill a contract when such costs meet certain criteria. These deferred costs are amortized over their estimated useful life. See Note 5 – Net Sales for a further discussion of those deferred costs. See Note 10 – Intangible Assets and Deferred Costs, Net.
(s) Warranty Expense
We provide a limited warranty for our mold and wind blade products, including materials and workmanship, with terms and conditions that vary depending on the product sold, generally for periods that range from two to five years. We may offer extended warranties to our customers in limited situations. Warranty expense is recorded based upon estimates of future repairs using a probability-based methodology that considers previous warranty claims, identified quality issues and industry practices. Once the warranty period has expired, any remaining unused warranty accrual for the specific products is generally reversed against the current year warranty expense amount, provided that the warranty accrual for other products whose warranty period has not yet expired is sufficient to cover the estimated cost of future repairs for those other products. See Note 12 – Accrued Warranty.
(t) Treasury Stock
Common stock purchased for treasury is recorded at historical cost. Transactions in treasury shares relate to shares withheld in lieu of income taxes associated with share-based compensation plans and are recorded at weighted-average cost.
F-17
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(u) Foreign Currency Translation and Income and Losses
Foreign currency-denominated assets and liabilities are translated into U.S. dollars at exchange rates existing at the respective balance sheet dates. Results of operations of our foreign subsidiaries are translated at the average exchange rates during the respective periods. Translation adjustments are reported in accumulated other comprehensive loss in our consolidated balance sheets. Currency translation adjustments for the years ended December 31, 2025, 2024 and 2023 amounted to other comprehensive income (losses) of $
Our reporting currency is the U.S. dollar. However, we have non-U.S. operating subsidiaries in our U.S., Mexico, India, and other segments.
Foreign currency transaction gains and losses are reported in foreign currency loss, net in our consolidated statements of operations.
(v) Share-Based Compensation
Our incentive compensation plan provides for the issuance of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock units (RSUs), restricted stock awards, unrestricted stock awards, cash-based awards, performance-based restricted stock units (PSUs), and dividend equivalent rights to certain of our associates, non-employee directors and consultants. The term of stock options may not exceed
For performance stock units that are subject to market conditions, we utilize a Monte Carlo simulation model to determine the fair value. The Monte Carlo simulation model utilizes multiple input variables to determine the share-based compensation expense, including expected volatility, dividend yield, and risk-free rate. The volatility was based on the most recent comparable period for our peer group and us. The risk-free interest rate is equal to the yield, as of the measurement date, of the U.S. Treasury bill that is commensurate with the remaining performance measurement period. We currently do not pay a dividend.
The determination of the grant date fair value using an option-pricing model and simulation model requires judgment as well as assumptions regarding a number of other complex and subjective variables. These variables include our closing market price at the grant date as well as the following assumptions:
F-18
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Expected Volatility. The expected volatility assumption reflects an average of our historical volatility and the volatilities of publicly traded peer group companies with a period equal to the expected life of the options.
Expected Life (years). We use the simplified method to estimate the expected term of stock options. The simplified method for estimating expected term is to use the mid-point between the vesting term and the contractual term of the option. We elected to use the simplified method because we did not have historical exercise data to estimate the expected term due to the limited time period our common stock has been publicly traded.
Risk-Free Interest Rate. The risk-free interest rate assumption is based upon the U.S. constant maturity treasury rates as the risk-free rate interpolated between the years commensurate with the expected life of the options.
Dividend Yield. The dividend yield assumption is
Forfeitures. Share-based compensation expense is reversed when the service-based award is forfeited.
Expected Vesting Period. We amortize the share-based compensation expense over the requisite service period.
Share-based compensation expense related to RSUs and PSUs are expensed over the vesting period using the straight-line method for our associates and our board of directors. The RSUs and PSUs do not have voting rights. We calculate the fair value of our share-based awards on the date of grant for our associates and directors. See Note 13 – Share-based Compensation.
(w) Leases
We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right of use (ROU) assets, current operating lease liabilities, and noncurrent operating lease liabilities in the consolidated balance sheets. Finance leases are included in property, plant and equipment, current maturities of long-term debt, and long-term debt, net of debt issuance costs and current maturities in the consolidated balance sheets.
Operating lease ROU assets and operating lease liabilities are recognized based on the present value of future minimum lease payments over the lease term at commencement date. Variable payments are not included in ROU assets or lease liabilities and can vary from period to period based on asset usage or our proportionate share of common costs. The implicit rate within our leases is generally not determinable and, therefore, the incremental borrowing rate at lease commencement is utilized to determine the present value of lease payments. We estimate our incremental borrowing rate based on third-party lender quotes to obtain secured debt in a like currency for a similar asset over a timeframe similar to the term of the lease. The ROU asset also includes any lease prepayments made and any initial direct costs incurred and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have elected not to recognize ROU assets or lease liabilities for leases with a term of 12 months or less.
We have lease agreements with lease and non-lease components. We have elected to apply the practical expedient to account for these components as a single lease component for all classes of underlying assets. See Note 15 – Leases.
(x) Income Taxes
Income taxes are accounted for under the asset and liability method in accordance with ASC Topic 740, Income Taxes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those differences are projected to be recovered or settled. Realization of deferred tax assets is dependent on our ability to generate sufficient taxable income of an appropriate character in future periods. A valuation allowance is established if it is determined to be more-likely-than-not that a deferred tax asset will not be realized. See Note 19 – Income Taxes.
F-19
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
(y) Use of Estimates
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the useful lives of property, plant and equipment, realizability of intangible assets, deferred costs and deferred tax assets, standalone selling prices and future contract volumes and the direct costs to complete the performance obligation for revenue recognition, fair value of stock options, performance-based restricted stock units and warrants, features related to our Series A Preferred Stock, our Term Loan, warranty reserves and other contingencies.
(z) Fair Value of Financial Instruments
ASC Topic 820, Fair Value Measurements, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Topic 820 also specifies a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value as follows:
Level 1: Quoted prices in active markets for identical assets or liabilities;
Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
Level 3: Valuation is generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions reflect our own estimate of assumptions that market participants would use in pricing the asset or liability.
The carrying amounts of our cash and cash equivalents, trade accounts receivable, income taxes receivable, accounts payable and accrued expenses and income taxes payable approximate fair value because of the short-term nature of these financial instruments. The carrying amount of our short-term unsecured financing and working capital loans approximates fair value due to their short-term nature and the loans carry a current market rate of interest, a Level 2 input. The Term Loan issued on December 14, 2023 was recorded at fair value at issuance resulting in an original issuance discount on the Term Loan (see Note 14 – Debt). The fair value of the Term Loan was estimated using the discounted cash flow method under the income approach, where the contractual cash flows were discounted to present value using a synthetic credit risk adjusted discount rate based on market rates for similar publicly traded debt, all of which represent Level 2 inputs. Since our derivative assets and liabilities are not traded on an exchange, we value them using standard industry valuation models. As applicable, these models project future cash flows and discount the amounts to a present value using market-based observable inputs, including interest rate curves, credit risk, foreign exchange rates, and forward and spot prices for currencies. These inputs are observable in active markets over the contract term of the derivative instruments we hold, including the Event of Default Derivative associated with our Term Loan, and accordingly, we classify the valuation techniques as Level 2.
(aa) Earnings Per Share
We calculate basic earnings per share for both continuing and discontinued operations, by dividing net income from continuing operations, and net income from discontinued operations, respectively, after deducting dividends on and accretion of preferred stock, by the average number of common shares outstanding during the period, which includes unissued common shares associated with vested equity awards for which little or no consideration is required prior to issuance, net of any treasury shares. We calculate diluted earnings per share for both continuing and discontinued operations in a similar manner after consideration of the potential dilutive effect of common stock equivalents on the average number of common shares outstanding during the period. Common stock equivalents include warrants, stock options, restricted stock awards and units, and performance share awards and units. Common stock equivalents are calculated based upon the treasury stock method using an average market price of common shares during the period. Dilution is not considered when a net loss from continuing operations is reported. Common
F-20
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
stock equivalents that have an antidilutive effect are excluded from the computation of diluted earnings per share. See Note 20 – Net Income (Loss) Per Share.
ASC Topic 260, Effect on the Calculation of Earnings per Share for the Redemption or Induced Conversion of Preferred Stock, provides guidance on the accounting for extinguishments (redemptions) of equity-classified preferred stock. It requires the gain or loss on extinguishment of equity-classified preferred stock to be included in the net income per common stockholder used to calculate earnings per share (similar to the treatment of dividends paid on preferred stock). The difference between (1) the fair value of the consideration transferred to the holders of the preferred stock and (2) the carrying amount of the preferred stock (net of issuance costs) is subtracted from (or added to) net income to arrive at income available to common stockholders in the calculation of earnings per share. Accordingly, any excess fair value of the consideration transferred over the carrying amount of the preferred stock is charged against retained earnings, or additional paid-in capital if there are insufficient retained earnings. We applied this guidance to the accounting treatment of the Series A Preferred Stock Exchange described in Note 14 – Debt.
(ab) Debt Discounts
Debt discounts on our long-term debt are recorded as a direct deduction from the carrying amount of such debt on the consolidated balance sheets. All debt discounts are amortized using the effective interest method over the term of the debt. Debt discount amortization expense is recorded as part of interest expense in the consolidated statements of operations.
(ac) Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements - Adopted
In December 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to improve the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. This ASU also includes certain other amendments intended to improve the effectiveness of income tax disclosures. This ASU is effective for annual reporting periods beginning after December 15, 2024, and allows the use of a prospective or retrospective approach. The Company adopted the standard on January 1, 2025 under the prospective approach. See Note 19 – Income Taxes.
Recently Issued Accounting Pronouncements - Not Yet Adopted
In November 2024, the FASB issued ASU 2024-03, Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses in commonly presented expense captions (such as cost of goods sold and general and administrative expenses). ASU 2024-03 is effective for the Company’s fiscal year beginning January 1, 2027 and allows the use of a prospective or retrospective approach. The Company is currently assessing the impact to our consolidated financial statements.
There have been no other recent accounting pronouncements or changes in accounting pronouncements during the current year that are of significance, or potential significance, to us.
Note 2. Bankruptcy Proceedings
Voluntary Petitions for Reorganization under Chapter 11 and Section 363 Sale Process
On August 11, 2025, the Debtors each filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code in the Bankruptcy Court.
The Company continues to operate its business as debtor-in-possession under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy Court. The Debtors filed customary “first-day” motions with the Bankruptcy Court seeking authorization to support ongoing operations during the Chapter 11 Cases, including to (i) pay employee wages and benefits, (ii) pay certain
F-21
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
critical vendors and suppliers for goods and services provided before the commencement of the Chapter 11 Cases, (iii) establish procedures for trading the Company’s stock, and (iv) continue honoring insurance and tax obligations as they come due.
The Debtors also filed a motion seeking approval of procedures for the sale of all or any of the Debtors’ assets pursuant to a competitive auction and sale process under section 363 of the Bankruptcy Code. The Transaction Committee of the Company’s Board of Directors engaged third parties to advise on the Company’s strategic options, including a potential sale of all, substantially all, or a portion of the Debtors’ assets in connection with the Chapter 11 Cases. The Company has incurred, and continues to incur, material reorganization expenses as a result of the Chapter 11 Cases.
Automatic Stay
The commencement of the Chapter 11 Cases constituted an event of default that accelerated all of the Company’s obligations under the documents governing the
DIP Financing
In connection with the filing of the Chapter 11 Cases, the Debtors entered into a Super-Priority Senior Secured Priming Debtor-in-Possession Credit Agreement and Guaranty, dated as of August 14, 2025 (the “DIP Credit Agreement” and such financing thereunder, the “DIP Financing”), with Oaktree Fund Administration, LLC as administrative agent (the “Administrative Agent”), and the lenders from time to time party thereto (collectively, the “DIP Lenders”), pursuant to which, and subject to the satisfaction of certain conditions, including the approval of the Bankruptcy Court, the DIP Lenders have agreed to provide the Company with a multiple draw term loan facility in an aggregate principal amount not to exceed $
Under the DIP Facility, (i) $
The DIP Facility will mature nine months from the Petition Date. The interest on the loans shall accrue at a per annum rate equal to
F-22
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
of this type.
On August 14, 2025, the Company received $
DIP Default
On March 1, 2026, the Company received a letter from the DIP Lenders regarding an Event of Default occurring under the DIP Credit Agreement. The letter notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
Liabilities Subject to Compromise
The accompanying audited consolidated balance sheet as of December 31, 2025 includes amounts classified as liabilities subject to compromise, which represent pre-petition liabilities that the Company anticipates will be allowed as claims in the Chapter 11 Cases. These amounts represent the Debtors’ current estimate of known or potential obligations to be resolved in connection with the Chapter 11 Cases and may differ from actual future settlements. The Company will continue to evaluate these liabilities throughout the chapter 11 process and adjust amounts as necessary. Such adjustments could be material and will be recorded in reorganization items, net in the accompanying consolidated statements of operations.
The following table summarizes amounts presented as liabilities subject to compromise:
|
|
December 31, |
|
|
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
Accounts payable and accrued expenses |
|
$ |
|
|
Accrued warranty |
|
|
|
|
Debt subject to compromise |
|
|
|
|
Operating lease liabilities |
|
|
|
|
Contract liabilities |
|
|
|
|
Total liabilities subject to compromise |
|
$ |
|
|
Reorganization Items, net
The Debtors have incurred and will continue to incur costs associated with the reorganization, including professional and consulting fees. Charges associated with the Chapter 11 Cases have been recorded as
F-23
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
reorganization items, net in the consolidated statements of operations and comprehensive loss.
|
|
Year Ended |
|
|
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
Professional and other bankruptcy-related fees (1) |
|
$ |
|
|
Adjustments to liabilities subject to compromise |
|
|
( |
) |
Employee retention costs |
|
|
|
|
DIP financing fees (2) |
|
|
|
|
Total reorganization items, net |
|
$ |
|
|
Note 3. Condensed Combined Debtor-in-Possession Financial Statements (Unaudited)
The financial statements below represent the unaudited condensed combined financial statements of the Debtors. The results of the Non-Debtors are not included in these combined financial statements. Intercompany transactions among the Debtors have been eliminated in the combined Debtors’ financial statements. Intercompany transactions among the Debtors and Non-Debtors have not been eliminated in the combined Debtors’ financial statements. The results of operations of the Debtors may not represent the actual results if operating on a stand-alone basis.
F-24
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION) |
|
|||
CONDENSED COMBINED DEBTORS' BALANCE SHEET |
|
|||
(Unaudited) |
|
|||
|
|
December 31, |
|
|
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
Assets |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
|
|
Restricted cash |
|
|
|
|
Accounts receivable |
|
|
|
|
Contract assets |
|
|
|
|
Prepaid expenses |
|
|
|
|
Other current assets |
|
|
|
|
Inventories |
|
|
|
|
Due from non-debtor affiliates |
|
|
|
|
Total current assets |
|
|
|
|
Property, plant and equipment, net |
|
|
|
|
Operating lease right of use assets |
|
|
|
|
Other noncurrent assets |
|
|
|
|
Investments in non-debtor affiliates |
|
|
|
|
Total assets of debtors |
|
$ |
|
|
|
|
|
|
|
Liabilities and Stockholders’ Deficit |
|
|
|
|
Current liabilities: |
|
|
|
|
Debtor-in-possession financing |
|
$ |
|
|
Accounts payable and accrued expenses |
|
|
|
|
Accrued warranty |
|
|
|
|
Current maturities of long-term debt, net of debt discounts |
|
|
|
|
Due to non-debtor affiliates |
|
|
|
|
Total liabilities not subject to compromise |
|
|
|
|
Liabilities subject to compromise |
|
|
|
|
Total liabilities of debtors |
|
|
|
|
Total stockholders’ deficit |
|
|
( |
) |
Total liabilities and stockholders’ deficit of debtors |
|
$ |
|
|
F-25
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION) |
|
|||
CONDENSED COMBINED DEBTORS' STATEMENT OF OPERATIONS |
|
|||
(Unaudited) |
|
|||
|
|
Year Ended December 31, |
|
|
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
Net sales |
|
$ |
|
|
Cost of sales |
|
|
|
|
Gross loss |
|
|
( |
) |
General and administrative expenses |
|
|
|
|
Loss on sale of assets and asset impairments |
|
|
|
|
Gain on sale of discontinued operations |
|
|
( |
) |
Restructuring charges, net |
|
|
|
|
Loss from debtor operations |
|
|
( |
) |
Total other expense |
|
|
( |
) |
Reorganization items, net |
|
|
|
|
Loss from debtor operations before income taxes |
|
|
( |
) |
Income tax benefit |
|
|
|
|
Net loss from debtor operations |
|
$ |
( |
) |
F-26
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION) |
|
|||
CONDENSED COMBINED DEBTORS' STATEMENT OF CASH FLOWS |
|
|||
(Unaudited) |
|
|||
|
|
|
|
|
|
|
Year Ended December 31, |
|
|
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
Cash flows from operating activities: |
|
|
|
|
Net loss |
|
$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
Depreciation and amortization |
|
|
|
|
Loss on sale of assets and asset impairments |
|
|
|
|
Gain on sale of discontinued operations |
|
|
( |
) |
Share-based compensation expense |
|
|
|
|
Amortization of debt issuance costs and debt discount |
|
|
|
|
Paid-in-kind interest |
|
|
|
|
Reorganization items, net |
|
|
( |
) |
Changes in assets and liabilities: |
|
|
|
|
Accounts receivable |
|
|
( |
) |
Contract assets and liabilities |
|
|
|
|
Operating lease right of use assets and operating lease liabilities |
|
|
|
|
Inventories |
|
|
( |
) |
Prepaid expenses |
|
|
( |
) |
Other current assets |
|
|
( |
) |
Other noncurrent assets |
|
|
( |
) |
Accounts payable and accrued expenses |
|
|
|
|
Accrued warranty |
|
|
|
|
Other noncurrent liabilities |
|
|
|
|
Net cash used in operating activities |
|
|
( |
) |
Cash flows from investing activities: |
|
|
|
|
Purchases of property, plant and equipment |
|
|
( |
) |
Net cash used in investing activities |
|
|
( |
) |
Cash flows from financing activities: |
|
|
|
|
Proceeds from DIP financing |
|
|
|
|
Payments of DIP financing costs |
|
|
( |
) |
Principal repayments of finance leases |
|
|
( |
) |
Net proceeds from other debt |
|
|
( |
) |
Repurchase of common stock including shares withheld in lieu of income taxes |
|
|
( |
) |
Net cash provided by financing activities |
|
|
|
|
Impact of foreign exchange rates on cash, cash equivalents and restricted cash |
|
|
|
|
Net change in cash, cash equivalents and restricted cash |
|
|
( |
) |
Cash, cash equivalents and restricted cash, beginning of year |
|
|
|
|
Cash, cash equivalents and restricted cash, end of period |
|
$ |
|
|
Note 4. Discontinued Operations
On September 10, 2025, following the satisfactory completion of the closing conditions, including the approval of the Bankruptcy Court, the Company consummated the sale and transfer of
F-27
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
position of the Turkish subsidiaries by the purchaser. The Türkiye business comprised the majority of the Company’s EMEA segment. The Company determined that the sale of the Türkiye business represented a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the historical results of our Türkiye business have been presented as discontinued operations in our consolidated statements of operations and consolidated balance sheets.
On June 30, 2024, we completed the divestiture of our wholly-owned subsidiary, TPI, Inc. (the Automotive subsidiary). The Automotive subsidiary was engaged in the development, commercialization and implementation of the Company’s automotive industry related products. The Automotive subsidiary was previously classified as held for sale in the Company’s consolidated balance sheets as of December 31, 2023. As a result of the divestiture, the Company recorded a $
The following tables present the carrying amounts of major classes of assets and liabilities that were included in discontinued operations:
|
|
December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Cash and cash equivalents |
|
$ |
|
|
$ |
|
||
Accounts receivable |
|
|
|
|
|
|
||
Contract assets |
|
|
|
|
|
|
||
Prepaid expenses |
|
|
|
|
|
|
||
Other current assets |
|
|
|
|
|
|
||
Inventories |
|
|
|
|
|
|
||
Property, plant and equipment, net |
|
|
|
|
|
|
||
Operating lease right of use assets |
|
|
|
|
|
|
||
Other noncurrent assets |
|
|
|
|
|
|
||
Total assets of discontinued operations |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Accounts payable and accrued expenses |
|
$ |
|
|
$ |
|
||
Accrued restructuring |
|
|
|
|
|
|
||
Current maturities of long-term debt |
|
|
|
|
|
|
||
Current operating lease liabilities |
|
|
|
|
|
|
||
Contract liabilities |
|
|
|
|
|
|
||
Long-term debt, net of current maturities |
|
|
|
|
|
|
||
Noncurrent operating lease liabilities |
|
|
|
|
|
|
||
Other noncurrent liabilities |
|
|
|
|
|
|
||
Total liabilities of discontinued operations |
|
$ |
|
|
$ |
|
||
The following tables present the components of net loss from discontinued operations:
F-28
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
|
|
Year Ended December 31, 2025 |
|
|||||||||||||
|
|
Türkiye |
|
|
Automotive |
|
|
Asia |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross loss |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Loss on sale of assets and asset impairments |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain on sale of discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Restructuring charges, net |
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Gain (loss) from discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Total other (expense) income |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Gain (loss) before income taxes |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Income tax provision |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Net loss from discontinued operations |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
Year Ended December 31, 2024 |
|
|||||||||||||
|
|
Türkiye |
|
|
Automotive |
|
|
Asia |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross profit (loss) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
|
||
General and administrative expenses |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Loss (gain) on sale of assets and asset impairments |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Loss on sale of discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Restructuring charges, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gain (loss) from discontinued operations |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Total other (expense) income |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Gain (loss) before income taxes |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Income tax benefit (provision) |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Net income (loss) from discontinued operations |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
||
|
|
Year Ended December 31, 2023 |
|
|||||||||||||||||||
|
|
Türkiye |
|
|
|
Automotive |
|
|
|
Asia |
|
|
|
Total |
|
|||||||
|
|
(in thousands) |
|
|||||||||||||||||||
Net sales |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|||||||
Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Gross profit (loss) |
|
|
|
|
— |
|
|
( |
) |
|
— |
|
|
( |
) |
|
— |
|
|
|
||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Loss on sale of assets and asset impairments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Restructuring charges, net |
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
||||||
Gain (loss) from discontinued operations |
|
|
|
|
|
|
( |
) |
|
|
|
( |
) |
|
|
|
|
|||||
Total other (expense) income |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Gain (loss) before income taxes |
|
|
|
|
|
|
( |
) |
|
|
|
( |
) |
|
|
|
( |
) |
||||
Income tax benefit (provision) |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||||
Net income (loss) from discontinued operations |
|
$ |
|
|
|
$ |
( |
) |
|
|
$ |
( |
) |
|
|
$ |
( |
) |
||||
The following table presents summarized cash flows from discontinued operations:
F-29
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Net cash (used in) provided by operating activities from discontinued operations |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
Net cash used in investing activities from discontinued operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net cash (used in) provided by financing activities from discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
||
Foreign currency exchange impacts on cash of discontinued operations |
|
|
|
|
|
( |
) |
|
|
|
||
Net change in cash and cash equivalents of discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
||
Additional non-cash items related to operating activities from discontinued operations: |
|
|
|
|
|
|
|
|
|
|||
Share-based compensation expense |
|
|
( |
) |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Note 5. Net Sales
The following tables represents the disaggregation of our net sales by product for each of our reportable segments:
|
|
Year Ended December 31, 2025 |
|
|||||||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Other |
|
|
Total |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Wind blade, tooling and other |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Field service, inspection and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
Year Ended December 31, 2024 |
|
|||||||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Other |
|
|
Total |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Wind blade, tooling and other |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Field service, inspection and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
Year Ended December 31, 2023 |
|
|||||||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Other |
|
|
Total |
|
|||||
|
|
(in thousands) |
|
|||||||||||||||||
Wind blade, tooling and other |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Field service, inspection and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
F-30
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
In addition, most of our net sales are made directly to our customers, primarily large multi-national wind turbine manufacturers, under our supply agreements.
For further information regarding our reportable segments, refer to Note 23 – Segment Reporting.
Contract Assets and Liabilities
Contract assets consist of the amount of revenue recognized over time for performance obligations in production where control has transferred to the customer, but the contract does not yet allow for the customer to be billed. Typically, customers are billed when the product finishes production and meets the technical specifications contained in the contract. The time it takes to produce a single wind blade is typically between
These contract assets and liabilities are reported on the consolidated balance sheets net on a contract-by-contract basis at the end of each reporting period, as demonstrated in the table below.
Contract assets and contract liabilities as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
|
|
(in thousands) |
|
|||||||||
Gross contract assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
||
Less: reclassification from contract liabilities |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Contract assets |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
||
|
|
2025 |
|
|
2024 |
|
|
$ Change |
|
|||
|
|
(in thousands) |
|
|||||||||
Gross contract liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Less: reclassification to contract assets |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Contract liabilities |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Gross contract assets decreased by $
For the years ended December 31, 2025, 2024 and 2023, we recognized revenue of $
As of December 31, 2025, $
Performance Obligations
Remaining performance obligations represent the transaction price for which work has not been performed and excludes any unexercised contract options. As discussed in Note 1 – Summary of Operations and Summary of Significant Accounting Policies – (d) Revenue Recognition, the transaction price includes estimated variable consideration as determined based on the estimated production output within the range of the contractual guaranteed minimum volume obligations and production capacity.
F-31
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
As of December 31, 2025, the aggregate amount of the transaction price allocated to the remaining performance obligations to be satisfied in future periods was approximately $
For the year ended December 31, 2025, net revenue recognized from our performance obligations satisfied in previous periods decreased by $
Pre-Production Investments
We recognize an asset for deferred costs incurred to fulfill a contract when those costs meet all of the following criteria: (a) the costs relate directly to a contract or to an anticipated contract that we can specifically identify; (b) the costs generate or enhance our resources that will be used in satisfying performance obligations in the future; and, (c) the costs are expected to be recovered. We capitalize the costs related to training our workforce to execute the manufacturing services and other facility set-up costs related to preparing for production of a specific contract. We factor these costs into our estimated cost analysis for the overall contract. Costs capitalized are amortized over the number of units produced during the contract term. As of December 31, 2025, the cost and accumulated amortization of such assets totaled $
Note 6. Significant Risks and Uncertainties
Our revenues and receivables are earned from a small number of customers. As such, our production levels are dependent on these customers’ orders. See Note 22 – Concentration of Customers.
We maintain our U.S. cash in bank deposit and money market accounts that, at times, exceed U.S. federally insured limits. U.S. bank accounts are guaranteed by the Federal Deposit Insurance Corporation (FDIC) in an amount up to $
We also maintain cash in bank deposit accounts outside the U.S. that are not subject to FDIC limits. As of December 31, 2025, this included $
Note 7. Accounts Receivable
Accounts receivable as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Trade accounts receivable |
|
$ |
|
|
$ |
|
||
Other accounts receivable |
|
|
|
|
|
|
||
Total accounts receivable |
|
$ |
|
|
$ |
|
||
F-32
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 8. Other Current Assets
Other current assets as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Refundable value-added tax |
|
$ |
|
|
$ |
|
||
Deposits |
|
|
|
|
|
|
||
Other current assets |
|
|
|
|
|
|
||
Total current assets |
|
$ |
|
|
$ |
|
||
Note 9. Property, Plant and Equipment, Net
Property, plant and equipment, net as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Machinery and equipment |
|
$ |
|
|
$ |
|
||
Leasehold improvements |
|
|
|
|
|
|
||
Office equipment and software |
|
|
|
|
|
|
||
Furniture |
|
|
|
|
|
|
||
Vehicles |
|
|
|
|
|
|
||
Construction in progress |
|
|
|
|
|
|
||
Idle assets |
|
|
|
|
|
|
||
Total property, plant and equipment, gross |
|
|
|
|
|
|
||
Accumulated depreciation |
|
|
( |
) |
|
|
( |
) |
Total property, plant and equipment, net |
|
$ |
|
|
$ |
|
||
Total depreciation for the years ended December 31, 2025, 2024 and 2023 was $
Note 10. Intangible Assets and Deferred Costs, Net
Carrying values and estimated useful lives of intangible assets and deferred costs as of December 31, 2025, consisted of the following:
|
|
Estimated |
|
Cost |
|
|
Accumulated |
|
|
Net |
|
|||
|
|
|
|
(in thousands) |
|
|||||||||
Pre-production investments (1) |
|
Various |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Patents |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Acquired development tools |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Trademarks |
|
Indefinite |
|
|
|
|
|
— |
|
|
|
|
||
Total intangible assets and deferred costs, net |
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Carrying values and estimated useful lives of intangible assets and deferred costs as of December 31, 2024, consisted of the following:
|
|
Estimated |
|
Cost |
|
|
Accumulated |
|
|
Net |
|
|||
|
|
|
|
(in thousands) |
|
|||||||||
Pre-production investments (1) |
|
Various |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
Patents |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Acquired development tools |
|
|
|
|
|
|
( |
) |
|
|
|
|||
Trademarks |
|
Indefinite |
|
|
|
|
|
— |
|
|
|
|
||
Total intangible assets and deferred costs, net |
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
F-33
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
During the years ended December 31, 2025, 2024 and 2023, we recorded amortization expense for the intangible assets and deferred costs of $
Note 11. Other Noncurrent Assets
Other noncurrent assets as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Deferred tax assets |
|
$ |
|
|
$ |
|
||
Deposits |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total other noncurrent assets |
|
$ |
|
|
$ |
|
||
Note 12. Accrued Warranty
Warranty accrual as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Warranty accrual at beginning of year |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Accrual during the year |
|
|
|
|
|
|
|
|
|
|||
Cost of warranty services provided during the year |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Changes in estimate for pre-existing warranties, |
|
|
|
|
|
|
|
|
|
|||
Warranty accrual at end of year |
|
$ |
|
|
$ |
|
|
$ |
|
|||
As of December 31, 2025, $
Note 13. Share-Based Compensation
The share-based compensation expense for the years ended December 31 was as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Cost of goods sold |
|
$ |
|
|
$ |
|
|
$ |
|
|||
General and administrative expenses |
|
|
|
|
|
|
|
|
|
|||
Total share-based compensation expense |
|
$ |
|
|
$ |
|
|
$ |
|
|||
The share-based compensation expense recognized by award type for the years ended December 31 was as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
RSUs |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Stock options |
|
|
|
|
|
|
|
|
|
|||
PSUs |
|
|
|
|
|
|
|
|
( |
) |
||
Total share-based compensation expense |
|
$ |
|
|
$ |
|
|
$ |
|
|||
F-34
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
The summary of activity for our incentive plans, including discontinued operations, is as follows:
|
|
|
|
|
Stock Options |
|
|
RSUs |
|
|
PSUs |
|
||||||||||||||||||||
|
|
Shares |
|
|
Shares |
|
|
Weighted- |
|
|
Options |
|
|
Units |
|
|
Weighted- |
|
|
Units |
|
|
Weighted- |
|
||||||||
Balance as of December 31, 2022 |
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||||||
Granted |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Exercised/vested |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||||||
Forfeited/cancelled |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|||||
Balance as of December 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Granted |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Exercised/vested |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||||||
Forfeited/cancelled |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|||||
Balance as of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Granted |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Exercised/vested |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
||||||
Forfeited/cancelled |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
|
|||||
Balance as of December 31, 2025 |
|
|
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||||||
The balance of PSUs outstanding as of December 31, 2025, includes
The following table summarizes the outstanding and exercisable stock option awards, including discontinued operations, as of December 31, 2025:
|
|
Options Outstanding |
|
|
Options Exercisable |
|
||||||||||||||
Range of Exercise Prices: |
|
Shares |
|
|
Weighted- |
|
|
Weighted- |
|
|
Shares |
|
|
Weighted- |
|
|||||
$ |
|
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|||||
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
$ |
|
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|||||
The following table contains additional information pertaining to stock options, including discontinued operations, for the years ended December 31:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Total intrinsic value of stock options outstanding |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Total intrinsic value of stock options exercisable |
|
|
|
|
|
|
|
|
|
|||
Cash received from the exercise of stock options |
|
|
|
|
|
|
|
|
|
|||
Fair value of stock options vested |
|
|
|
|
|
|
|
|
|
|||
N/A - not applicable. There were no stock options granted during the year ended December 31, 2025.
As of December 31, 2025, the unamortized cost of the outstanding RSUs and PSUs was $
F-35
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
non-vested stock option awards was $
The fair value of the stock options granted during the years ended December 31 were calculated using the Black-Scholes option pricing model with the following assumptions:
|
|
2025 |
|
2024 |
|
|
2023 |
|
||
Weighted-average fair value |
|
N/A |
|
$ |
|
|
$ |
|
||
Expected volatility |
|
N/A |
|
|
% |
|
|
% |
||
Expected life |
|
N/A |
|
|
|
|
||||
Risk-free interest rate |
|
N/A |
|
|
% |
|
|
% |
||
Dividend yield |
|
N/A |
|
|
% |
|
|
% |
||
The fair value of the PSU grants with market conditions made during the years ended December 31 were calculated using a Monte Carlo simulation model with the following assumptions:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Expected volatility |
|
|
% |
|
|
% |
|
|
% |
|||
Risk-free interest rate |
|
|
% |
|
|
% |
|
|
% |
|||
Dividend yield |
|
|
% |
|
|
% |
|
|
% |
|||
Note 14. Debt
The commencement of the Chapter 11 Cases constituted an event of default (and an acceleration event) under the Company’s debt agreements and the enforcement of any remedies in respect of such default and acceleration is automatically stayed as a result of the Chapter 11 Cases. As a result of the forgoing acceleration event, all of the Company's outstanding indebtedness, including indebtedness subject to cross default provisions, has been classified as current debt in the accompanying consolidated balance sheet as of December 31, 2025.
Long-term debt, net of current maturities, as of December 31 consisted of the following:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Debtor-in-possession financing (1) |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|||
|
|
|
|
|
|
|||
Secured and unsecured working capital—India |
|
|
|
|
|
|
||
Other debt and equipment finance leases (3) |
|
|
|
|
|
|
||
Total debt—principal |
|
|
|
|
|
|
||
Less: Debt issuance costs (4) |
|
|
|
|
|
( |
) |
|
Less: Debt discount (5) |
|
|
( |
) |
|
|
( |
) |
Less: Debt subject to compromise (6) |
|
|
( |
) |
|
|
|
|
Total debt, net of debt issuance costs and debt discount |
|
|
|
|
|
|
||
Less: Current maturities of long-term debt |
|
|
( |
) |
|
|
( |
) |
Long-term debt, net of current maturities |
|
$ |
|
|
$ |
|
||
F-36
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
The following tables summarize borrowing capacity for our various credit facilities and outstanding balances for all debt arrangements as of December 31:
|
|
|
|
2025 |
|
|
2024 |
|
||||||||||
Credit facilities |
|
Interest Rates |
|
Total Borrowing Capacity |
|
|
Outstanding Balance |
|
|
Total Borrowing Capacity |
|
|
Outstanding Balance |
|
||||
|
|
|
|
(in thousands) |
|
|||||||||||||
Secured and unsecured working capital—India |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total credit facilities |
|
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Term debt and equipment financing |
|
Interest Rates |
|
|
|
|
Outstanding Balance |
|
|
|
|
|
Outstanding Balance |
|
||||
Debtor-in-possession financing |
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other debt and equipment finance leases |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total term debt and equipment financing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total debt—principal |
|
|
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
The average interest rate on our short-term borrowings as of December 31, 2025 and 2024 was approximately
DIP Financing
In connection with the filing of the Chapter 11 Cases, the Debtors entered into a Super-Priority Senior Secured Priming Debtor-in-Possession Credit Agreement and Guaranty, dated as of August 14, 2025 (the “DIP Credit Agreement” and such financing thereunder, the “DIP Financing”), with Oaktree Fund Administration, LLC as administrative agent (the “Administrative Agent”), and the lenders from time to time party thereto (collectively, the “DIP Lenders”), pursuant to which, and subject to the satisfaction of certain conditions, including the approval of the Bankruptcy Court, the DIP Lenders have agreed to provide the Company with a multiple draw term loan facility in an aggregate principal amount not to exceed $
Under the DIP Facility, (i) $
The DIP Facility will mature nine months from the Petition Date. The interest on the loans shall accrue at a per annum rate equal to
F-37
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
continuance of an event of default, unless otherwise waived by the DIP Lenders, the interest rate on all obligations (including interest on overdue principal, interest and other amounts) shall accrue at an additional
On August 14, 2025, the Company received $
DIP Default
On March 1, 2026, the Company received a letter from the DIP Lenders regarding an Event of Default occurring under the DIP Credit Agreement. The letter notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
Note 15. Leases
We have operating and finance leases for our manufacturing facilities, warehouses, offices, automobiles and certain of our machinery and equipment. Our leases have remaining lease terms of between and
The components of lease cost for the years ended December 31 were as follows:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Total operating lease cost |
|
$ |
|
|
$ |
|
||
|
|
|
|
|
|
|
||
Finance lease cost |
|
|
|
|
|
|
||
Amortization of assets under finance leases |
|
$ |
|
|
$ |
|
||
Interest on finance leases |
|
|
|
|
|
|
||
Total finance lease cost |
|
$ |
|
|
$ |
|
||
F-38
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Total finance lease liabilities as of December 31 were as follows:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Finance Leases |
|
|
|
|
|
|
||
Property, plant and equipment, gross |
|
$ |
|
|
$ |
|
||
Less: accumulated depreciation |
|
|
( |
) |
|
|
( |
) |
|
$ |
|
|
$ |
|
|||
|
|
|
|
|
|
|
||
|
$ |
|
|
$ |
|
|||
|
|
|
|
|
|
|||
Total finance lease liabilities |
|
$ |
|
|
$ |
|
||
Future minimum lease payments under noncancelable leases as of December 31, 2025 were as follows:
|
|
Operating |
|
|
Finance |
|
||
|
|
Leases |
|
|
Leases |
|
||
|
|
(in thousands) |
|
|||||
Year Ending December 31, |
|
|
|
|
|
|
||
2026 |
|
$ |
|
|
$ |
|
||
2027 |
|
|
|
|
|
|
||
2028 |
|
|
|
|
|
|
||
2029 |
|
|
|
|
|
|
||
2030 |
|
|
|
|
|
|
||
Thereafter |
|
|
|
|
|
|
||
Total future minimum lease payments |
|
|
|
|
|
|
||
Less: interest |
|
|
( |
) |
|
|
( |
) |
Total lease liabilities |
|
$ |
|
|
$ |
|
||
As of December 31, 2025, $
Supplemental cash flow information related to leases for the years ended December 31 was as follows:
|
|
2025 |
|
|
2024 |
|
||
|
|
(in thousands) |
|
|||||
Cash paid for amounts included in the |
|
|
|
|
|
|
||
Operating cash flows from operating leases |
|
$ |
|
|
$ |
|
||
Operating cash flows from finance leases |
|
|
|
|
|
|
||
Financing cash flows from finance leases |
|
|
|
|
|
|
||
Other information related to leases as of December 31 was as follows:
|
|
2025 |
|
|
2024 |
|
||
Weighted-Average Remaining Lease Term |
|
|
|
|
|
|
||
Operating leases |
|
|
|
|
|
|
||
Finance leases |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Weighted-Average Discount Rate: |
|
|
|
|
|
|
||
Operating leases |
|
|
% |
|
|
% |
||
Finance leases |
|
|
% |
|
|
% |
||
F-39
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 16. Financial Instruments
Foreign Exchange Derivative Contracts
We use foreign exchange derivative contracts, such as call options, to mitigate our exposure to fluctuations in exchange rates between the functional currencies of our subsidiaries and the other currencies in which they transact. We do not use such derivative contracts for speculative or trading purposes.
Our foreign exchange call option contracts qualified for accounting as cash flow hedges in accordance with Accounting Standards Codification Topic 815, Derivatives and Hedging, and we designated them as such.
Mexican Peso
With regards to our foreign exchange call option contracts, for the year ended December 31, 2025, $
The fair values and location of financial instruments in our consolidated balance sheets as of December 31, were as follows:
|
|
Consolidated Balance |
|
|
|
|
|
|
||
Financial Instrument |
|
Sheet Line Item |
|
2025 |
|
|
2024 |
|
||
|
|
|
|
(in thousands) |
|
|||||
Foreign exchange call option contracts |
|
Other current assets |
|
$ |
|
|
$ |
|
||
The following table presents the pretax amounts reclassified from accumulated other comprehensive loss into our consolidated statements of operations:
Comprehensive Income |
|
Consolidated Statement of |
|
|
|
|
|
|
|
|
|
|||
(Loss) Component |
|
Operations Line Item |
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
|
|
(in thousands) |
|
|||||||||
Foreign exchange call option contracts |
|
Other income |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
||
Foreign exchange call option contracts |
|
Cost of sales |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
||
Note 17. Restructuring charges, net
Restructuring charges, net for the years ended December 31 were as follows:
|
|
Year Ended December 31, 2025 |
|
|||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Severance |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other restructuring costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total restructuring charges, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
F-40
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
|
|
Year Ended December 31, 2024 |
|
|||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Severance |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other restructuring costs |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total restructuring charges, net |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
Year Ended December 31, 2023 |
|
|||||||||||||
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Severance |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Other restructuring costs |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Total restructuring charges, net |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
The following is a summary of our restructuring liability activity for the periods presented:
|
|
U.S. |
|
|
Mexico |
|
|
India |
|
|
Total |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Balance at December 31, 2022 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Restructuring charges, net |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|||
Payments |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance at December 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Restructuring charges, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Payments |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
Balance at December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Restructuring charges, net |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Payments |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Balance at December 31, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
For the year ended December 31, 2025, restructuring charges, net includes $
Note 18. Commitments and Contingencies
Legal Proceedings
From time to time, we may be involved in disputes or litigation relating to claims arising out of our operations.
In January 2021, we received a complaint that was filed by the administrator for the Senvion Gmbh (Senvion) insolvency estate in German insolvency court. The complaint asserts voidance against us in the aggregate amount of $
From time to time, we are party to various lawsuits, claims, and other legal proceedings that arise in the ordinary course of business, some of which are covered by insurance. Upon resolution of any pending legal matters, we may incur charges in excess of presently established reserves. Our management does not believe that any such
F-41
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
charges would, individually or in the aggregate, have a material adverse effect on our financial condition, results of operations or cash flows.
Automatic Stay and Other Protections
Subject to certain exceptions under the Bankruptcy Code, pursuant to section 362 of the Bankruptcy Code, the filing of the Chapter 11 Cases automatically stayed the continuation of most legal proceedings or the filing of other actions against or on behalf of the Company or its property to recover on, collect or secure a claim arising prior to the Petition Date or to exercise control over property of the Company’s bankruptcy estate, unless and until the Bankruptcy Court modifies or lifts the automatic stay as to any such claim. Notwithstanding the general application of the automatic stay described above and other protections afforded by the Bankruptcy Code, certain actions may continue pursuant to certain governmental powers.
Insurance/Self-Insurance
We use a combination of insurance and self-insurance for a number of risks, including claims related to our associate health care, workers’ compensation and general liability. Liabilities associated with these risks are estimated based on, among other things, historical claims experience, severity factors, and other actuarial assumptions. Our loss exposure related to self-insurance is limited by stop loss coverage on a per occurrence and aggregate basis. We regularly analyze our reserves for incurred but not reported claims, and for reported but not paid claims related to our self-funded insurance programs. While we believe our reserves are adequate, significant judgment is involved in assessing these reserves such as assessing historical paid claims, average lags between the claims’ incurred date, reported dates and paid dates, and the frequency and severity of claims. There may be differences between actual settlement amounts and recorded reserves and any resulting adjustments are included in expense once a probable amount is known.
Collective Bargaining Agreements
Certain of our associates in Matamoros, Mexico are covered by collective bargaining agreements. Our collective bargaining agreement at our Matamoros, Mexico manufacturing facility is in effect through March 2027.
Escheat Audit
In November 2020, we were notified by the state of Delaware that they intend to examine our books and records to determine compliance with Delaware escheat laws. Since that date, additional states have joined with Delaware in the audit process. The escheat audit is being conducted by an outside firm on behalf of the states and covers the period from 2005 to 2019. The audit is in the final stages, and we believe that any claims or liabilities resulting from these audits will not have a material impact on our financial condition, results of operations and cash flows.
Customs Review
U.S. Customs and Border Protection (“CBP”) is currently reviewing certain of the wind blade models that are manufactured at our facilities in Mexico pursuant to the Uyghur Forced Labor Prevention Act (“UFLPA”). As a result of these reviews, CBP has restricted the importation of these wind blades into the United States while the matter remains under investigation. Although we are confident that our wind blade supply chain does not source materials from the Xinjiang Uyghur Autonomous Region of China, the UFLPA establishes a rebuttable presumption that goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region of China, or by certain identified entities, are made with forced labor and are therefore prohibited from entry into the United States unless the importer can demonstrate otherwise to the satisfaction of CBP.
Because of the current CBP actions, a substantial portion of the wind blades manufactured at our Mexico facilities are unable to be imported into the U.S. market. The inability to import these wind blades has significantly disrupted, and may continue to disrupt, our supply chain, reduce available inventory for U.S. customers, delay deliveries, and result in lost sales. In addition, these CBP reviews have required and may continue to require
F-42
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
significant management attention, internal resources, and legal and compliance costs as we work to respond to CBP’s inquiries and further demonstrate compliance with applicable laws.
The outcome and duration of the CBP reviews are uncertain. If we are unable to satisfactorily resolve the matter, CBP may continue to detain, exclude, or seize affected wind blades, which could further restrict our ability to serve customers in the United States and may require us to modify our sourcing, manufacturing, or supply chain practices. Any prolonged disruption in our ability to import wind blades into the United States, or any adverse findings by CBP, will have a further, material adverse effect on our business, financial condition, and results of operations.
Note 19. Income Taxes
On January 1, 2025, the Company adopted ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures on a prospective basis for the year ended December 31, 2025.
Tax Legislation
Our business is subject to a wide variety of U.S. federal, state and foreign tax laws, regulations and policies. Changes to these laws or regulations may affect our tax liability, return on investments and business operations.
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, including modifications to the international tax framework, restoration of tax treatment for certain business provisions, and accelerated the phase-out of certain Inflation Reduction Act (“IRA”) incentives, including the advanced manufacturing production credit. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company expects that the phase-out of certain IRA incentives in future periods, particularly the Advanced Manufacturing Production Credit (“AMPC”), could have a material impact on customer demand for our wind blade products and on our consolidated financial statements. Beginning in 2025, the OBBBA provides an elective deduction for domestic research and development expenses, a reinstatement of elective 100% first-year bonus depreciation. Some impacts of the OBBBA will not be realized until 2026 and forward such as income from non-U.S. subsidiaries (Net CFC Tested Income). The Company does not expect the provisions of the OBBBA, other than the AMPC, to have a material impact on its consolidated financial statements.
Beginning January 1, 2024, Pillar Two legislation, commonly referred to as the global minimum tax of
Components of Income Taxes
F-43
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Income (loss) from continuing operations before income taxes:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
U.S. loss |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Non-U.S. (loss) income |
|
|
|
|
|
|
|
|
|
|||
Total loss before income taxes |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
The Company’s income tax provision includes U.S. federal, state, and local taxes, Mexico and India taxes currently payable and deferred taxes due to temporary differences between the financial statement and the tax bases of assets and liabilities.
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Current: |
|
|
|
|
|
|
|
|
|
|||
U.S. federal |
|
$ |
|
|
$ |
|
|
$ |
|
|||
U.S. state and local taxes |
|
|
|
|
|
|
|
|
|
|||
Foreign |
|
|
|
|
|
|
|
|
|
|||
Total current |
|
|
|
|
|
|
|
|
|
|||
Deferred: |
|
|
|
|
|
|
|
|
|
|||
U.S. federal |
|
|
|
|
|
|
|
|
|
|||
U.S. state and local taxes |
|
|
|
|
|
|
|
|
|
|||
Foreign |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total deferred |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total income tax provision |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Income Taxes Paid
The Company operates and files income tax returns in various jurisdictions where we have continuing operations, including Mexico, India, the United States, Denmark, Germany, Spain, the United Kingdom, and Switzerland, all of which remain subject to examination by the respective tax authorities. In the United States, federal tax returns for periods after 2019 remain open to examination. For U.S. state and local jurisdictions and most non‑U.S. jurisdictions, the statute of limitations generally ranges from three to ten years. However, where permitted by law, tax authorities may examine and adjust prior periods when amended returns have been filed or when NOLs or tax credits have been generated and carried forward.
The Company files a consolidated U.S. federal income tax return for its domestic subsidiaries, which enables the Company to use tax deductions and credits of one member of its U.S. subsidiaries to reduce the tax that otherwise would have been payable by another member of its U.S. subsidiaries. The effective tax rate reflects the benefit of these tax reductions in the consolidated U.S. federal income tax return.
In accordance with the updated requirements of ASU 2023-09 for the year ended December 31, 2025, cash paid for income taxes, net of refunds, related to continuing operations was as follows:
F-44
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
|
|
2025 |
|
|
|
|
(in thousands) |
|
|
U.S. federal |
|
$ |
|
|
U.S. state and local taxes |
|
|
|
|
Total U.S. |
|
|
|
|
|
|
|
|
|
India |
|
|
|
|
Mexico |
|
|
|
|
Other |
|
|
|
|
Total Non-U.S. |
|
|
|
|
Total income taxes paid |
|
$ |
|
|
Income taxes paid related to discontinued operations for the years ended December 31, 2025, 2024 and 2023 were $
Effective Tax Rate Reconciliation
In accordance with the updated requirements of ASU 2023-09 for the year ended December 31, 2025. A reconciliation of the U.S. statutory income tax rate to our effective income tax rate was as follows:
|
|
2025 |
|
|||||
|
|
Amount |
|
|
Rate |
|
||
|
|
(in thousands) |
|
|
|
|
||
U.S. statutory income tax benefit |
|
$ |
( |
) |
|
|
% |
|
State and local income taxes, net of federal income tax effect (1) |
|
|
|
|
|
|
||
Foreign tax effects: |
|
|
|
|
|
|
||
Mexico |
|
|
|
|
|
|
||
Foreign currency / inflationary adjustments |
|
|
( |
) |
|
|
|
|
Other |
|
|
|
|
|
( |
) |
|
Other foreign jurisdictions |
|
|
( |
) |
|
|
|
|
Non-taxable / deductible items |
|
|
|
|
|
( |
) |
|
Change in valuation allowance |
|
|
|
|
|
( |
) |
|
Change in unrecognized tax benefits |
|
|
|
|
|
( |
) |
|
Other |
|
|
|
|
|
( |
) |
|
Effective income tax rate |
|
$ |
|
|
|
( |
)% |
|
F-45
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
As previously disclosed for the years ended December 31, 2024, and 2023, a reconciliation of the U.S. federal statutory income tax rate to the effective income tax rate was as follows:
|
|
2024 |
|
|
2023 |
|
||
U.S. statutory income tax rate |
|
|
% |
|
|
% |
||
Foreign rate differential |
|
|
( |
) |
|
|
( |
) |
Foreign permanent differences |
|
|
( |
) |
|
|
|
|
Withholding taxes |
|
|
|
|
|
( |
) |
|
Gain on sale of subsidiary |
|
|
( |
) |
|
|
|
|
GILTI income |
|
|
( |
) |
|
|
( |
) |
Share-based compensation |
|
|
( |
) |
|
|
( |
) |
Valuation allowance |
|
|
( |
) |
|
|
( |
) |
State taxes |
|
|
|
|
|
|
||
Deferred tax adjustments |
|
|
( |
) |
|
|
( |
) |
BEAT implication |
|
|
( |
) |
|
|
|
|
Prior year transfer pricing adjustment |
|
|
|
|
|
( |
) |
|
Foreign currency / inflationary adjustments |
|
|
( |
) |
|
|
|
|
Other |
|
|
|
|
|
|
||
Effective income tax rate |
|
|
( |
)% |
|
|
( |
)% |
Deferred Income Taxes
The Company does not recognize deferred taxes on basis differences related to investments in foreign subsidiaries when the associated earnings are considered indefinitely reinvested. At December 31, 2025, undistributed earnings from continuing operations of certain foreign subsidiaries were approximately $
The following is a summary of the components of deferred tax assets and liabilities, included in other noncurrent assets and other noncurrent liabilities, respectively, in the consolidated balance sheets as of December 31:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Deferred tax assets: |
|
|
|
|
|
|
|
|
|
|||
Net operating loss and credit carry forwards |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Non-deductible accruals |
|
|
|
|
|
|
|
|
|
|||
Lease liabilities |
|
|
|
|
|
|
|
|
|
|||
Equity compensation |
|
|
|
|
|
|
|
|
|
|||
Non-deductible interest |
|
|
|
|
|
|
|
|
|
|||
Tax credits |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Gross deferred tax assets |
|
|
|
|
|
|
|
|
|
|||
Valuation allowance |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total deferred tax assets |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Deferred tax liabilities: |
|
|
|
|
|
|
|
|
|
|||
Depreciation |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Contract assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Lease assets |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
Total deferred tax liabilities |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net deferred tax assets |
|
$ |
|
|
$ |
|
|
$ |
|
|||
F-46
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
The valuation allowance at December 31, 2025 primarily relates to U.S. federal and state deferred tax assets and certain foreign net operating losses that the Company does not believe meet the more‑likely‑than‑not threshold for realization. The deferred tax valuation allowance as of December 31 is summarized as follows:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Valuation allowance at beginning of year |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Benefits obtained (costs accumulated) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Valuation allowance at end of year |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
As of December 31, 2025, we have U.S. federal and state NOL carryforwards of $
Income Tax Contingencies
We recognize the tax effects of a position in the financial statements only when it is more‑likely‑than‑not that the position will be sustained upon examination based on its technical merits. Unrecognized tax benefits reflect the reserves recorded for uncertain tax positions taken on filed returns as well as the unrecognized portion of affirmative claims. As of December 31, 2025, unrecognized tax benefits from continuing operations include $
Our policy is to record interest and penalties related to uncertain tax positions as a component of the income tax provision or benefit. No material interest or penalties were accrued during 2025, 2024, or 2023.
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Unrecognized tax benefits at beginning of year |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Increases related to prior year tax positions |
|
|
|
|
|
|
|
|
|
|||
Decreases related to prior year tax positions |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Increases related to current year tax positions |
|
|
|
|
|
|
|
|
|
|||
Settlements |
|
|
|
|
|
|
|
|
|
|||
Unrecognized tax benefits at end of year |
|
$ |
|
|
$ |
|
|
$ |
|
|||
F-47
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 20. Net Loss Per Common Share
The following table sets forth the computation of basic and diluted net loss per common share:
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands, except per share data) |
|
|||||||||
Numerator: |
|
|
|
|
|
|
|
|
|
|||
Net loss from continuing operations |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Preferred stock dividends and accretion |
|
|
|
|
|
|
|
|
( |
) |
||
Gain on extinguishment |
|
|
|
|
|
|
|
|
|
|||
Net loss from continuing operations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net loss from discontinued operations |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Net loss attributable to common stockholders |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Denominator: |
|
|
|
|
|
|
|
|
|
|||
Basic weighted-average shares outstanding |
|
|
|
|
|
|
|
|
|
|||
Effect of dilutive awards |
|
|
|
|
|
|
|
|
|
|||
Diluted weighted-average shares outstanding |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Loss from continuing operations per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Loss from discontinued operations per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Loss per common share: |
|
|
|
|
|
|
|
|
|
|||
Basic |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Diluted |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
|
|
|
|
|
|
|
|
|
|||
Dilutive shares excluded from the calculation |
|
|
|
|
|
|
|
|
|
|||
Anti-dilutive share-based compensation awards |
|
|
|
|
|
|
|
|
|
|||
F-48
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 21. Stockholders’ Equity
Accumulated Other Comprehensive Loss
The following table presents the changes in accumulated other comprehensive loss (AOCL) by component for the years ended December 31, 2025, 2024 and 2023:
|
|
Foreign |
|
|
Accrued |
|
|
Foreign |
|
|
|
|
||||
|
|
currency |
|
|
post-retirement |
|
|
exchange |
|
|
|
|
||||
|
|
translation |
|
|
benefit |
|
|
forward |
|
|
Total |
|
||||
|
|
adjustments |
|
|
liability |
|
|
contracts |
|
|
AOCL |
|
||||
|
|
(in thousands) |
|
|||||||||||||
Balance at December 31, 2022 |
|
$ |
( |
) |
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amounts reclassified from AOCL |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net tax effect |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net current period other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2023 |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Other comprehensive income |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Amounts reclassified from AOCL |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net tax effect |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net current period other comprehensive income |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Balance at December 31, 2024 |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Other comprehensive loss |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Amounts reclassified from AOCL |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net tax effect |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net current period other comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2025 |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Note 22. Concentration of Customers
Revenues from certain customers (in thousands) in excess of
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||||||||||||||
Customer |
|
Revenues |
|
|
% of Total |
|
|
Revenues |
|
|
% of Total |
|
|
Revenues |
|
|
% of Total |
|
||||||
|
|
(in thousands) |
|
|
|
|
|
(in thousands) |
|
|
|
|
|
(in thousands) |
|
|
|
|
||||||
GE Vernova |
|
$ |
|
|
|
% |
|
$ |
|
|
|
% |
|
$ |
|
|
|
% |
||||||
Vestas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Nordex |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trade accounts receivable from certain customers in excess of
|
|
2025 |
|
|
2024 |
|
||
Customer |
|
% of Total |
|
|
% of Total |
|
||
GE Vernova |
|
|
% |
|
|
% |
||
Vestas |
|
|
|
|
|
|
||
Nordex |
|
|
|
|
|
|
||
F-49
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 23. Segment Reporting
We report our results of operations for our
Our chief executive officer is our chief operating decision maker (CODM). The CODM primarily uses information about each operating segment’s revenues and income (loss) from operations to allocate resources to and assesses the performance of each operating segment and consolidated results. These measures are utilized during our budgeting and forecasting process to assess growth and profitability and enable decision making regarding strategic initiatives, capital investments, and personnel across all operating segments. Our CODM is also regularly provided information about the significant expenses that are included in the income (loss) from operations by segment. Our CODM does not regularly evaluate our operating segments using asset or liability information.
Our U.S. segment operates in the U.S. dollar and includes (1) the manufacturing of wind blades at our Newton, Iowa facility in which restarted production in the second half of 2025, (2) wind blade inspection and repair services, (3) our advanced engineering center in Kolding, Denmark, which provides technical and engineering resources to our manufacturing facilities, (4) our engineering center in Berlin, Germany and (5) our corporate headquarters, the costs of which are included in general and administrative expenses.
Our Mexico segment operates in its local currency, the Mexican Peso, and includes a U.S. parent company that operates in the U.S. dollar. This segment includes (1) the manufacturing of wind blades at our three facilities in Juárez, Mexico and one facility in Matamoros, Mexico and (2) wind blade inspection and repair services.
Our India segment operates in the U.S. dollar and includes (1) the manufacturing of wind blades at our facility in Chennai, India, and (2) wind blade inspection and repair services.
All other business operations are included in the “Other” segment, and primarily consist of our European field services businesses.
The following table presents certain information regarding each of our reporting segments as of or for the years ended December 31, including sales, cost of goods sold, other segment expenses, and income (loss) from continuing operations:
F-50
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Net sales by segment (and geographic location): |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of goods sold: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total cost of goods sold |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Other segment expenses (1): |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total other segment expenses |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Income (loss) from continuing operations: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Mexico |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
India |
|
|
( |
) |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Total loss from continuing operations |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Capital expenditures: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total capital expenditures |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total depreciation and amortization |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Tangible long-lived assets: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
|
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total tangible long-lived assets |
|
$ |
|
|
$ |
|
|
|
|
|||
Total assets: |
|
|
|
|
|
|
|
|
|
|||
U.S. |
|
$ |
|
|
$ |
|
|
|
|
|||
Mexico |
|
|
|
|
|
|
|
|
|
|||
India |
|
|
|
|
|
|
|
|
|
|||
Other |
|
|
|
|
|
|
|
|
|
|||
Total assets from continuing operations |
|
$ |
|
|
$ |
|
|
|
|
|||
F-51
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Note 24. Subsequent Events
DIP Default
On March 1, 2026, the Company received a letter from the DIP Lenders regarding an Event of Default occurring under the DIP Credit Agreement. The letter notified and confirmed to the Company that, because, among other things, as of the date of the letter, the Bankruptcy Court has not entered a Disclosure Statement Order (nor any other order approving the adequacy of a disclosure statement in connection with a chapter 11 plan for the Debtors), an Event of Default under the DIP Credit Agreement has occurred and is continuing pursuant to Section 11.01(g) (Events of Default) of the DIP Credit Agreement (the “DIP Default”). On March 16, 2026, the DIP Lenders agreed to waive the DIP Default, extend the maturity date under the DIP Credit Agreement and consent to the Vestas Sale Transactions, ECP Sale Transaction and GEV Transaction (as each is defined below) as set forth in more detail in the Oaktree Consent Term Sheet filed with the Bankruptcy Court.
Vestas India Transaction
On March 4, 2026, the Company, and certain of its direct and indirect subsidiaries entered into an Asset Purchase Agreement (the “India Purchase Agreement”) with Vestas Wind Technology India Private Limited (“Buyer”) and Vestas Wind Systems A/S (“Buyer Parent”) pursuant to which the Company and certain of its subsidiaries, including TPI Composites India Private Limited (“TPI India” collectively with the Company, “Sellers”) will sell and transfer to Buyer substantially all assets related to its manufacturing business in Chennai, India where Sellers manufacture wind blades for Buyer Parent and certain of its affiliates for a purchase price of $
Pursuant to the India Purchase Agreement, the consummation of the India APA Transaction is subject to a number of closing conditions, including, among other things, (i) entry by the Bankruptcy Court of an order approving the portion of the India APA Transaction to be consummated by the Company and the other Debtors party thereto, (ii) receipt of certain third-party consents, approvals or waivers, and (iii) the execution of a termination and mutual release by and among the Company and certain of its affiliates, on one hand, and Buyer and Buyer Parent on the other, which, among other things, provides for the termination of the existing commercial and manufacturing arrangements between Buyer and its affiliates, on one hand, and Sellers and certain of their affiliates, on the other hand and a customary release of certain claims each party thereto, together with their affiliates, may have against the other.
The India Purchase Agreement may be terminated by Sellers or Buyer under certain circumstances, including, among others, if the India APA Transaction is not closed by June 30, 2026 (the “India APA Outside Date”). The India Purchase Agreement may also be terminated by Sellers if Buyer Parent ceases to provide certain agreed upon payment advances through to the India APA Outside Date.
Vestas Mexico Transaction
On March 4, 2026, certain subsidiaries of the Company, TPI Mexico V, LLC (“TPI Mexico V”) and TPI Mexico VI, LLC (“TPI Mexico VI” and, together with TPI Mexico V, the “TPI Mexico Entities”), entered into an Equity Commitment Agreement (the “Equity Commitment Agreement”) with Vestas America Holdings, Inc. (the “Commitment Party”) and Buyer Parent, which provides, among other things, for the restructuring of the capital structure and liabilities of the TPI Mexico Entities pursuant to a joint plan of reorganization (the “Plan”). Pursuant to the Equity Commitment Agreement, TPI Mexico V and TPI Mexico VI will issue new equity interests representing
F-52
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
Pursuant to the Equity Commitment Agreement, the consummation of the Equity Transaction is subject to a number of closing conditions, including, among other things, (i) entry by the Bankruptcy Court of an order confirming the Plan and the Equity Transaction and (ii) the consent to, and release of liens by, Oaktree Fund Administration, LLC or certain of its affiliates.
The Equity Commitment Agreement may be terminated by the Commitment Party or the TPI Mexico Entities under certain circumstances, including, among others, if the Bankruptcy Court denies confirmation of the Plan or if the Plan’s effective date has not occurred by June 30, 2026 (the “Mexico ECA Outside Date”).
Concurrently with the Equity Commitment Agreement, the Company and certain of its direct and indirect subsidiaries (collectively, the “Mexico APA Sellers”) entered into an Asset Purchase Agreement with the Commitment Party (the “Mexico Purchase Agreement”), pursuant to which the Commitment Party will purchase certain limited assets of each of the Mexico APA Sellers primarily related to the manufacturing of wind turbine blades in Matamoros, Mexico, in exchange for $
Pursuant to the Mexico Purchase Agreement, the consummation of the Mexico APA Transaction is subject to a number of closing conditions, including, among other things, (i) entry by the Bankruptcy Court of an order approving the portion of the Mexico APA Transaction to be consummated by the Company and the other Debtors party thereto, (ii) the consummation of the Equity Transaction concurrently with the consummation of the Mexico APA Transaction and (iii) the satisfaction or waiver of all closing conditions under the Equity Commitment Agreement.
The Mexico Purchase Agreement may be terminated by the Commitment Party or the Mexico APA Sellers under certain circumstances, including, among others, if the Mexico APA Transaction is not closed by June 30, 2026 (the “Mexico APA Outside Date”). The Mexico Purchase Agreement may also be terminated by the Mexico APA Sellers if the Commitment Party (or an affiliate thereof) ceases to provide certain agreed upon payment advances through to the Mexico APA Outside Date.
ECP Transaction
On March 6, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “ECP Seller Parties”) entered into a Stock and Asset Purchase Agreement (the “ECP Purchase Agreement”) with ECP Blade Holdings LLC (“ECP Buyer”). Pursuant to the ECP Purchase Agreement, the ECP Seller Parties will sell and transfer to the ECP Buyer free and clear of all liens, interests, and encumbrances (except as expressly set forth in the ECP Purchase Agreement) pursuant to section 363 of the Bankruptcy Code (i) all of the equity interests in certain indirect subsidiaries of the Company, including TPI Composites, S. de R.L. de C.V., TPI Blade Services LATAM S.A. de C.V., and TPI Blade Services Europe S.L.U. (collectively, the “Transferred Entities”), and (ii) all assets primarily related to the Company’s wind blade manufacturing business at facilities located in the United States and Mexico and related storage facilities, wind blade inspection and repair services located in the United States, and Europe and Mexico, and design and technical support to global manufacturing and service operations through engineering and technical centers (the “ECP Business”), in exchange for $
GE Vernova Transaction
Additionally, on March 16, 2026, the Company and certain of its direct and indirect subsidiaries (collectively, the “Back-Up Bidder Seller Parties”) entered into a Term Sheet (the “GE Vernova Term Sheet”) with GE Vernova
F-53
TPI COMPOSITES, INC. AND SUBSIDIARIES (DEBTOR-IN-POSSESSION)
Notes to Consolidated Financial Statements
International LLC (“GE Vernova”), setting forth the terms of definitive documentation to be entered into among the Back-Up Bidder Seller Parties and GE Vernova (the “Back-Up Bidder Documentation”). Pursuant to the GE Vernova Term Sheet, in the event that the ECP Purchase Agreement is terminated and subject to other conditions set forth in the GE Vernova Term Sheet, the Back-Up Bidder Seller Parties will sell and transfer to GE Vernova, free and clear of all liens, interests, and encumbrances (except as will be set forth in the Back-Up Bidder Documentation) pursuant to section 363 of the Bankruptcy Code certain assets of the Back-Up Bidder Seller Parties, including assets related to wind blade manufacturing at our Iowa facility and all related storage facilities used in connection with such manufacturing and other intellectual property related to wind blade manufacturing of the blade types (including, but not limited to, design, technical support, and other items) (the “GEV Business”), in exchange for $
F-54
Exhibit Index
Number |
|
Description |
|
|
|
2.1 |
|
Stock Purchase Agreement, among TPI Composites, Inc., Composite Solutions, Inc., TPI, Inc.,and CCI Global Water Fund LP, dated June 17, 2024 (incorporated by reference to Exhibit 2.1 to the Registrant’s Quarterly Report on Form 10-Q filed on August 8, 2024) |
|
|
|
3.1 |
|
Amended and Restated Certificate of Incorporation of the Registrant, as currently in effect (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on July 11, 2016) |
|
|
|
3.2 |
|
Third Amended and Restated By-laws of the Registrant as currently in effect (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on May 19, 2022) |
|
|
|
4.1 |
|
Specimen Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on July 11, 2016) |
|
|
|
4.2 |
|
Third Amended and Restated Investor Rights Agreement by and among the Registrant and the investors named therein, dated June 17, 2010, as amended (incorporated by reference to Exhibit 4.2 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
4.3 |
|
Form of senior indenture, to be entered into between the Registrant and the trustee designated therein (incorporated by reference to Exhibit 4.3 to the Registrant’s Registration Statement on Form S-3 (File No. 333-220307) filed on September 1, 2017) |
|
|
|
4.4 |
|
Form of subordinated indenture, to be entered into between the Registrant and the trustee designated therein (incorporated by reference to Exhibit 4.5 to the Registrant’s Registration Statement on Form S-3 (File No. 333-220307) filed on September 1, 2017) |
|
|
|
4.5 |
|
Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Act of 1934 (incorporated by reference to the Registrant’s Annual Report on Form 10-K (File No. 001-37839) filed on March 2, 2020) |
|
|
|
4.6 |
|
Indenture, dated as of March 3, 2023, between TPI Composites, Inc. and U.S. Bank Trust Company, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on March 3, 2023) |
|
|
|
4.7 |
|
Form of 5.25% Convertible Senior Notes due 2028 (included in Exhibit 4.1) (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on March 3, 2023). |
|
|
|
10.1‡ |
|
2008 Stock Option and Grant Plan, as amended by Amendment No. 1, dated August 14, 2008 and Amendment No. 2, dated December 30, 2008, and forms of award agreements thereunder (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.2‡ |
|
Amended and Restated 2015 Stock Option and Incentive Plan and forms of award agreements thereunder (incorporated by reference to Exhibit 10.2 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.3† |
|
Supply Agreement between General Electric International, Inc. and TPI Mexico III, LLC, entered into as of October 4, 2016 (incorporated by reference to Exhibit 10.4 of the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on December 30, 2020) |
|
|
|
10.4† |
|
Supply Agreement between General Electric International, Inc. and TPI Mexico, LLC, entered into as of October 18, 2013, as amended (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on December 30, 2020) |
|
|
|
10.5† |
|
First Amendment to Supply Agreement between General Electric International, Inc. and TPI Mexico, LLC, entered into as of October 4, 2016 (incorporated by reference to Exhibit 10.2 of the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on December 30, 2020) |
|
|
|
10.6 |
|
Lease between TPI Iowa, LLC and Opus Northwest L.L.C., dated November 13, 2007, as amended (incorporated by reference to Exhibit 10.11 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.7 |
|
Sixth Amendment to Lease between TPI Iowa, LLC and ILPT Newton Iowa, LLC, dated October 10, 2022 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on November 3, 2022) |
|
|
|
10.8 |
|
Commencement Date Memorandum between TPI Iowa LLC and Opus Northwest, L.L.C., entered into as of July 25, 2008 (incorporated by reference to Exhibit 10.12 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.9 |
|
Lease between TPI-Composites S. de R.L. de C.V. and Deutsche Bank México, S.A. Institución de Banca Múltiple, Division Fiduciaria, as Trustee of Trust F/1638, dated April 15, 2013, as amended (incorporated by reference to Exhibit 10.18 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.10 |
|
Amendment Agreement, among Macquarie Mexico Real Estate Management S.A. de. C.V., TPI-Composites, S. de R.L. de C.V. and TPI Composites, Inc., dated November 27, 2018 (incorporated by reference to Exhibit 10.17 to the Registrant’s Annual Report on Form 10-K (File No. 001-37839) filed on March 5, 2019) |
|
|
|
10.11 |
|
Lease between TPI-Composites S. de R.L. de C.V. and The Bank of New York Mellon, S.A., as Trustee in the Trust F/00335, dated September 25, 2013 (incorporated by reference to Exhibit 10.19 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.12 |
|
Lease between TPI Mexico, LLC and Trailer Transfer, Inc., dated October 16, 2013 (incorporated by reference to Exhibit 10.20 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.13 |
|
Lease between TPI Mexico, LLC and Lanestone 1, LLC, dated April 14, 2014 (incorporated by reference to Exhibit 10.21 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.14 |
|
Form of Employment Agreement between the Registrant and each of its executive officers (incorporated by reference to Exhibit 10.21 to the Registrant's Annual Report on Form 10-K (File No. 001-37839) filed on February 25, 2021) |
|
|
|
10.15 |
|
Form of Indemnification Agreement (incorporated by reference to Exhibit 10.24 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.16 |
|
Lease between TPI Composites, S. de R.L. de C.V. and Vesta Baja California, S. de R.L. de C.V., dated November 20, 2015 (incorporated by reference to Exhibit 10.26 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on June 17, 2016) |
|
|
|
10.17 |
|
Senior Executive Cash Incentive Bonus Plan (incorporated by reference to Exhibit 10.34 to the Registrant’s Registration Statement on Form S-1 (File No. 333-212093) filed on July 11, 2016) |
|
|
|
10.18 |
|
Master Lease Agreement Subject to Condition between TPI Composites II, S. de R.L. de C.V. and QVC II, S. de. R.L. de C.V. dated May 25, 2017, as amended (incorporated by reference to Exhibit 10.34 to the Registrant’s Annual Report on Form 10-K (File No. 001-37839) filed on March 8, 2018) |
|
|
|
10.19 |
|
Third Amended and Restated Non-Employee Director Compensation Policy (incorporated by reference to Exhibit 10.27 to the Registrant's Annual Report on Form 10-K (File No. 001-37839) filed on February 20, 2025) |
|
|
|
10.20 |
|
Agreement to Lease between Aarush (Phase III) Logistics Park Private Limited, Aarush (Phase IV) Logistics Parks Private Limited, Aarush (Phase V) Logistics Parks Private Limited, Aarush Logistics Parks Private Limited, Aarush (Phase II) Logistics Parks Private Limited and Prospect One Manufacturing LLP, dated February 4, 2019 (incorporated by reference to Exhibit 10.36 to the Registrant’s Annual Report on Form 10-K (File No. 001-37839) filed on March 5, 2019) |
|
|
|
10.21 |
|
Form of Employee Restricted Stock Unit Award (Time-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.22 |
|
Form of Executive Restrictive Stock Unit Award (Time-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.23 |
|
Form of Employee Restricted Stock Unit Award (Adjusted EBITDA Performance-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.24 |
|
Form of Executive Restricted Stock Unit Award (Adjusted EBITDA Performance-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.25 |
|
Form of Employee Restricted Stock Unit Award (Stock Price Performance-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.26 |
|
Form of Executive Restricted Stock Unit Award (Stock Price Performance-Based Vesting) under the Amended and Restated 2015 Stock Option And Incentive Plan (incorporated by reference to Exhibit 10.7 to the Registrant’s Quarterly Report on Form 10-Q (File No. 001-37839) filed on May 3, 2018) |
|
|
|
10.27 |
|
Investor Rights Agreement, dated as of November 22, 2021, among the Registrant, Oaktree Power Opportunities Fund V (Delaware) Holdings, L.P., Opps TPIC Holdings, LLC and Oaktree Phoenix Investment Fund, L.P. (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K (File No. 001-37839) filed on November 24, 2021) |
|
|
|
10.28 |
|
Credit Agreement and Guaranty, dated as of December 14, 2023, among the Company, the subsidiary guarantors from time to time party thereto, the lenders from time to time party thereto and Oaktree Fund Administration, LLC (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on December 14, 2023). |
|
|
|
10.29 |
|
Common Stock Purchase Agreement, dated as of December 14, 2023, among the Company, Oaktree Power Opportunities Fund V (Delaware) Holdings, L.P., Opps TPIC Holdings, LLC and Oaktree Phoenix Investment Fund, L.P.(incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on December 14, 2023) |
|
|
|
10.30 |
|
Amended and Restated Investor Rights Agreement, dated as of December 14, 2023, among the Company, Oaktree Power Opportunities Fund V (Delaware) Holdings, L.P., Opps TPIC Holdings, LLC and Oaktree Phoenix Investment Fund, L.P. (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on December 14, 2023) |
|
|
|
10.31 |
|
Form of Capped Call Transaction Confirmation (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 001-37839) filed on March 3, 2023) |
|
|
|
10.32 |
|
Asset Purchase Agreement, dated as of March 4, 2026, by and among TPI Composites, Inc., TPI Composites India Private Limited, certain non-debtor subsidiaries of TPI Composites, Inc., Vestas Wind Systems A/S and Vestas Wind Technology India Private Limited (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on March 5, 2026) |
|
|
|
10.33 |
|
Asset Purchase Agreement, dated as of March 4, 2026, by and among TPI Composites, Inc., certain of its debtor and non-debtor subsidiaries, and Vestas America Holdings, Inc. (incorporated by reference to Exhibit 10.2 of the Registrant’s Form 8-K (File No. 001-37839) filed on March 5, 2026) |
|
|
|
10.34 |
|
Equity Commitment Agreement, dated as of March 4, 2026, by among TPI Mexico V, LLC, TPI Mexico VI, LLC, Vestas America Holdings, Inc. and Vestas Wind Systems A/S (incorporated by reference to Exhibit 10.3 of the Registrant’s Form 8-K (File No. 001-37839) filed on March 5, 2026) |
|
|
|
10.35 |
|
Stock and Asset Purchase Agreement, dated as of March 6, 2026, by and among TPI Composites, Inc., ECP Blade Holdings LLC, TPI Technology, Inc., TPI Mexico, LLC, TPI Mexico II, LLC, TPI Mexico III, LLC, TPI Arizona, LLC, TPI Iowa, LLC, TPI Composites Services, LLC, TPI Turkey Izbas, LLC, TPI Composites Denmark ApS, and TPI Holdings Switzerland GmbH (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on March 9, 2026) |
|
|
|
10.36*
|
|
Form of Retention Bonus Agreement between the Registrant and each of its executive officers |
|
|
|
10.37 |
|
Term Sheet, dated as of September 4, 2025, by and among TPI Kompozit Kanat Sanayi ve Ticaret Anonim Şirketi, TPI Kompozit Kanat 2 Üretim Sanayi ve Ticaret Limited Şirketi, TPI Holdings Switzerland GmbH and XCS Composites L.L.C-FZ (incorporated by reference to Exhibit 10.1 of the Registrant’s Form 8-K (File No. 001-37839) filed on September 4, 2025) |
|
|
|
19.1 |
|
Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Registrant's Annual Report on Form 10-K (File No. 001-37839) filed on February 20, 2025) |
|
|
|
21.1* |
|
List of Subsidiaries |
|
|
|
24.1 |
|
Power of Attorney (incorporated by reference to the signature page of this Annual Report on Form 10-K) |
|
|
|
31.1* |
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
|
|
31.2* |
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|
|
|
32.1** |
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
|
|
32.2** |
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
|
|
97.1 |
|
Compensation Recovery Policy |
|
|
|
101.INS* |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data file because its XBRL tags are embedded within the Inline XBRL document |
|
|
|
101.SCH* |
|
Inline XBRL Taxonomy Extension Schema Document |
|
|
|
104 * |
|
Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101.*) |
* Filed herewith.
** The certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Annual Report on Form 10-K and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the Registrant specifically incorporates it by reference.
† Confidential treatment has been granted for certain provisions of this Exhibit pursuant to Rule 406 promulgated under the Securities Act of 1933.
‡ Indicates compensatory plan or arrangement
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
TPI COMPOSITES, INC. |
||
|
|
|
|
|
Date: March 25, 2026 |
|
By: |
|
/s/ Ryan Miller |
|
|
|
|
Ryan Miller |
|
|
|
|
Chief Financial Officer (Principal Financial Officer) |
We, the undersigned officers and directors of TPI Composites, Inc., hereby severally constitute and appoint William E. Siwek and Ryan Miller and each of them singly (with full power to each of them to act alone), our true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution in each of them for him or her and, place and stead, and in any and all capacities, to sign conformed for us and in our names in the capacities indicated below any and all signatures and amendments to this report, and to file the same, with all exhibits thereto, filing date and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as full to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.
Name |
|
Title |
|
Date |
|
|
|
|
|
/s/ William E. Siwek |
|
President, Chief Executive Officer and Director |
|
March 25, 2026 |
William E. Siwek |
|
(Principal Executive Officer) |
|
|
|
|
|
|
|
/s/ Ryan Miller |
|
Chief Financial Officer |
|
March 25, 2026 |
Ryan Miller |
|
(Principal Financial and Accounting Officer) |
|
|
|
|
|
|
|
/s/ Jayshree S. Desai |
|
Director |
|
March 25, 2026 |
Jayshree S. Desai |
|
|
|
|
|
|
|
|
|
/s/ Paul G. Giovacchini |
|
Lead Independent Director |
|
March 25, 2026 |
Paul G. Giovacchini |
|
|
|
|
|
|
|
|
|
/s/ Neal Goldman |
|
Director |
|
March 25, 2026 |
Neal Goldman |
|
|
|
|
|
|
|
|
|
/s/ Bavan M. Holloway |
|
Director |
|
March 25, 2026 |
Bavan M. Holloway |
|
|
|
|
|
|
|
|
|
/s/ Tyrone M. Jordan |
|
Director |
|
March 25, 2026 |
Tyrone M. Jordan |
|
|
|
|
|
|
|
|
|
/s/ Steven C. Lockard |
|
Director and Chairman of the Board |
|
March 25, 2026 |
Steven C. Lockard |
|
|
|
|
|
|
|
|
|
/s/ Tim Pohl |
|
Director |
|
March 25, 2026 |
Tim Pohl |
|
|
|
|
|
|
|
|
|
FAQ
What is the current restructuring status of TPI Composites (TPICQ)?
What happens to TPI Composites (TPICQ) common shareholders in the Chapter 11 cases?
Where does TPI Composites stock trade now and what are its reporting plans?
What major asset sale agreements has TPI Composites announced in bankruptcy?
How large is TPI Composites’ debt and DIP financing during restructuring?
How is the Uyghur Forced Labor Prevention Act affecting TPI Composites’ operations?
What was TPI Composites’ market value and share count before deregistration plans?
