Item 9A. Controls and Procedures
Item 9A. Controls and Procedures
Management’s Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is (1) recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and (2) accumulated and communicated to our management, including our principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2024. Based upon the evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of December 31, 2024, our disclosure controls and procedures were effective at the reasonable assurance level.
Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as such term as defined in Exchange Act Rule 13a-15(f). Internal control over financial reporting is a process designed under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the U.S.
As of December 31, 2024, our management assessed the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 Framework). Based on this assessment, our management concluded that, as of December 31, 2024, our internal control over financial reporting was effective based on those criteria.
Attestation Report of the Registered Public Accounting Firm
BDO USA, P.C., the independent registered public accounting firm that audited our financial statements included elsewhere in this Form 10-K, has issued an attestation report on our internal control over financial reporting. That report appears in "Item 8. Financial Statements and Supplementary Data" and is incorporated by reference to this Item 9A.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) of the Exchange Act) that occurred during the fourth quarter of 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Item 9B. Other Information
Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements
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None of the Company’s directors or officers adopted , modified or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the Company’s fiscal quarter ended December 31, 2024, as such terms are defined under Item 408(a) of Regulation S-K.
Amendment and Restatement of our Bylaws
On February 20, 2025 our Board of Directors approved and the Company adopted our second amended and restated bylaws (as amended and restated, the “Second Amended and Restated Bylaws” or “bylaws”), effective February 20, 2025. The Second Amended and Restated Bylaws make changes to account for the SEC’s universal proxy rules, updates to Delaware general corporate law (the “DGCL”), state requirements for calling a special meeting of stockholders or a special board meeting; remove outdated language, and to improve the readability and accessibility of our bylaws. The amendments:
• address matters relating to Rule 14a-19 of the Exchange Act (the “Universal Proxy Rules”) by requiring stockholders intending to use the Universal Proxy Rules to provide all of the information required by the Universal Proxy Rules, including (i) a representation that such stockholders will (1) file a definitive proxy statement with the Securities and Exchange Commission, and (2) distribute such proxy statement to, and solicit proxies from, the holders of shares representing at least 67% of the voting power of shares entitled to vote on the election of the directors of the Board, and (ii) reasonable evidence of the satisfaction of the requirements under the Universal Proxy Rules not later than seven business days before the applicable meeting of stockholders;
• require a representation by each director nominee that, if elected, they intend to serve as a director of the Company’s Board until a successor is elected and/or deemed qualified;
• provide the Company a remedy if a stockholder fails to satisfy the Universal Proxy Rules requirements;
• require any stockholders directly or indirectly soliciting proxies from other stockholders to use a proxy card color other than white, with the white proxy card being reserved for exclusive use by the Board;
• implement certain revisions to conform to recent amendments to the DGCL, including (i) giving the Company the ability to provide the details for an adjourned meeting in any manner permitted by the DGCL, and (ii) permit the Company to make a stockholder list available via an electronic network prior to a meeting of stockholders;
• state that a special meeting of the Company’s stockholders may be called by a majority of the members of the Board and/or the CEO, in addition to the Chairman of the Board;
• clarify that a special meeting of the Board may be called by a majority of the Board;
• remove outdated language, such as references to Class B stockholder rights; and
• make administrative, conforming, and clarifying changes to improve the readability of the bylaws.
The foregoing description of the terms of our Second Amended and Restated Bylaws does not purport to be complete and is qualified in its entirety by reference to the Second Amended and Restated Bylaws, a copy of which is filed as Exhibit 3.2 to this report and which is incorporated herein by reference.
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Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The Company has an insider trading policy governing the purchase, sale and other dispositions of the Company’s securities that applies to all Company personnel, including directors, officers, employees, and other covered persons. The Company believes that its insider trading policy is reasonably designed to promote compliance with insider trading laws, rules and regulations, and listing standards applicable to the Company. A copy of the Company’s insider trading policy is filed as Exhibit 19.1 to this Form 10-K.
The information required to be disclosed by this item concerning our directors and corporate governance is incorporated by reference to the information set forth in the section titled “Board of Directors and Corporate Governance” in the Company’s definitive proxy statement, to be filed with the Securities and Exchange Commission within 120 days after the end of the fiscal year covered by this Annual Report (the “Proxy Statement”). The information required to be disclosed by this item concerning our executive officers is incorporated by reference to the information set forth in the section entitled “Executive Officers” in the Company’s Proxy Statement. The information regarding our Section 16 reporting compliance is incorporated by reference to the information set forth in the section entitled “Security Ownership of Certain Beneficial Owners and Management” in the Company’s Proxy Statement.
Item 11. Executive Compensation
The information required to be disclosed by this item is incorporated by reference to the information set forth in the section entitled “Executive Compensation” in the Company’s Proxy Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required to be disclosed by this item is incorporated by reference to the information set forth in the section entitled “Security Ownership of Certain Beneficial Owners and Management” in the Company’s Proxy Statement.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required to be disclosed by this item is incorporated by reference to the information in the sections entitled “Certain Relationships and Related Party Transactions” and “Board of Directors and Corporate Governance” in the Company’s Proxy Statement.
Item 14. Principal Accountant Fees and Services
The information required to be disclosed by this item is incorporated by reference to the information in the section entitled “Ratification of Appointment of Independent Registered Accounting Firm” in the Company’s Proxy Statement.
PART IV
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Item 15. Exhibit and Financial Statement Schedules
(a)(1) Financial Statements.
The financial statements and supplementary data required by this item are included after the Signature page of this Annual Report on Form 10-K beginning on page 50.
(a)(2) Financial Statement Schedules.
All schedules have been omitted because they are not required or because the required information is given in the Financial Statements or Notes thereto.
(a)(3) Exhibits.
The exhibits listed in the Exhibit Index below are filed or incorporated by reference as part of this Annual Report.
EXHIBIT INDEX
Incorporated by Reference
Number Description of Document Form Filing Date Exhibit No.
3.1 Amended and Restated Certificate of Incorporation of Shoals Technologies Group, Inc., dated January 28, 2021
8-K 1/29/2021 3.1
3.2 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Shoals Technologies Group, Inc., dated January 28, 2021
10-Q 8/6/2024 3.2
3.3* Second Amended and Restated Bylaws of Shoals Technologies Group, Inc., dated February 20, 2025
4.1* Description of Registered Securities
10.1† Employment Agreement, effective as of October 3, 2022, by and between Dominic Bardos and Shoals Technologies Group, LLC
10-Q 11/14/2022 10.1
10.2† Shoals Technologies Group, Inc. 2021 Long-Term Incentive Plan
S-8 1/29/2021 10.1
10.3† Form of RSU Grant Notice and Award Agreement (Employees)
S-8 1/29/2021 10.2
10.4† Form of RSU Grant Notice and Award Agreement (Directors)
S-8 1/29/2021 10.3
10.5† Form of RSU Grant Notice and Award Agreement
10-Q 5/8/2023 10.3
10.6† Form of PSU Grant Notice and Award Agreement
10-Q 5/8/2023 10.4
10.7† Form of RSU Grant Notice and Award Agreement (2024)
10-K 2/28/2024 10.12
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EXHIBIT INDEX
Incorporated by Reference
Number Description of Document Form Filing Date Exhibit No.
10.8† Form of PSU Grant Notice and Award Agreement (2024)
10-K 2/28/2024 10.13
10.9† Form of Director and Officer Indemnification Agreement
S-1 12/30/2020 10.5
10.10† Employment Agreement, effective as of December 31, 2020, by and between Mehgan Peetz and Shoals Technologies Group, LLC
S-1/A 1/25/2021 10.11
10.11† Shoals Technologies Group, Inc. Executive Severance Plan
8-K 2/27/2023 10.2
10.12† Offer Letter, dated as of June 11, 2023, by and between Brandon Moss and Shoals Technologies Group, Inc.
8-K 6/14/2023 10.1
10.13 Amendment No. 2, dated as of December 30, 2020, to the Credit Agreement, dated as of November 25, 2020, by and among Shoals Holdings LLC, Shoals Intermediate Holdings LLC, Wilmington Trust, National Association, as Administrative Agent and Collateral Agent, the lenders party thereto, and JPMorgan Chase Bank, N.A. and Guggenheim Securities, LLC, as lead arrangers and bookrunners
S-1 12/30/2020 10.1
10.14 Amendment No. 3 to Credit Agreement, dated as of August 26, 2021, by and among Shoals Holdings LLC, Shoals Intermediate Holdings LLC, Wilmington Trust, National Association, as Term Loan Administrative Agent and Collateral Agent, JPMorgan Chase Bank, N.A. as Revolving Facility Administrative Agent and each L/C Issuer and the lenders party thereto
10-Q 11/10/2021 10.1
10.15 Amendment No. 5 to Credit Agreement, dated as of May 2, 2022, by and among Shoals Holdings LLC, Shoals Intermediate Holdings LLC, Wilmington Trust, National Association, as Term Loan Administrative Agent and Collateral Agent, JPMorgan Chase Bank, N.A., as Revolving Facility Administrative Agent and each L/C Issuer and the lenders party thereto
8-K 5/5/2022 10.1
10.16 Amendment No. 6 to Credit Agreement, dated as of March 19, 2024, by and among Shoals Technologies Group, Inc., Wilmington Trust, National Association, as Collateral Agent, JPMorgan Chase Bank, N.A., as Administrative Agent and each L/C Issuer and the lenders party thereto
8-K 3/22/2024 10.1
10.17† Offer Letter, dated December 12, 2022, by and between Jeffery Tolnar and Shoals Technologies Group, Inc.
10-K 2/28/2024 10.24
10.18*† Offer Letter, dated March 1, 2024, by and between Inez Lund and Shoals Technologies Group, Inc.
19.1* Shoals Technologies Group, Inc. Insider Trading Policy
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EXHIBIT INDEX
Incorporated by Reference
Number Description of Document Form Filing Date Exhibit No.
21.1* Subsidiaries of the Registrant
23.1* Consent of BDO USA, P.C., as to Shoals Technologies Group, Inc.
31.1* Certification of the Chief Executive Officer, as required by Section 302 of the Sarbanes- Oxley Act of 2002 (18 U.S.C. 1350)
31.2* Certification of the Chief Financial Officer, as required by Section 302 of the Sarbanes- Oxley Act of 2002 (18 U.S.C. 1350)
32.1** Certification of the Chief Executive Officer and Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002
97.1 Shoals Technologies Group, Inc. Clawback and Recoupment Policy
10-K 2/28/2024 97.1
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
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
________
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* Filed herewith
** Furnished herewith
† Indicates a management contract or compensatory plan.
Item 16. Form 10–K Summary
None
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on February 25, 2025.
Shoals Technologies Group, Inc.
By: /s/ Brandon Moss
Name: Brandon Moss
Title: Chief Executive Officer and Director
* * * *
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacity and on the dates indicated.
Signature Title Date
/s/ Brandon Moss Chief Executive Officer (Principal Executive Officer) and Director February 25, 2025
Brandon Moss
/s/ Dominic Bardos Chief Financial Officer February 25, 2025
Dominic Bardos (Principal Financial Officer)
/s/ Inez Lund Chief Accounting Officer February 25, 2025
Inez Lund (Principal Accounting Officer)
/s/ Brad Forth Chair of the Board of Directors February 25, 2025
Brad Forth
/s/ Ty Daul
Member of the Board of Directors February 25, 2025
Ty Daul
/s/ Lori Sundberg Member of the Board of Directors February 25, 2025
Lori Sundberg
/s/ Toni Volpe Member of the Board of Directors February 25, 2025
Toni Volpe
/s/ Niharika Taskar Ramdev Member of the Board of Directors February 25, 2025
Niharika Taskar Ramdev
/s/ Jeannette Mills Member of the Board of Directors February 25, 2025
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Signature Title Date
Jeannette Mills
/s/ Robert Julian Member of the Board of Directors February 25, 2025
Robert Julian
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