run-10q_20150630.htm

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES o NO x

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). YES x NO o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definition of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o NO x

As of September 11, 2015, the number of shares of the registrant’s common stock outstanding was 100,814,572.

	June 30, 2015			December 31, 2014
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	116,610		$	152,154
Restricted cash		5,764			2,534
Accounts receivable (net of allowances for doubtful accounts of $1,045 and $703 as of June 30, 2015 and December 31, 2014, respectively)		49,619			43,189
Grants receivable		—			5,183
Inventories		37,804			23,914
Prepaid expenses and other current assets		16,698			9,560
Deferred tax assets, current		2,559			3,048
Total current assets		229,054			239,582
Restricted cash		7,390			6,012
Solar energy systems, net		1,695,728			1,480,223
Property and equipment, net		27,229			22,195
Intangible assets, net		24,808			13,111
Goodwill		87,555			51,786
Prepaid tax asset		142,785			109,381
Other assets		26,201			13,342
Total assets(1)	$	2,240,750		$	1,935,632
Liabilities and total equity
Current liabilities:
Accounts payable	$	69,566		$	51,166
Distributions payable to noncontrolling interests and redeemable noncontrolling interests		6,463			6,764
Accrued expenses and other liabilities		42,833			25,445
Deferred revenue, current portion		51,929			44,398
Deferred grants, current portion		14,002			13,754
Capital lease obligation, current portion		3,928			1,593
Long-term debt, current portion		1,824			2,602
Lease pass-through financing obligation, current portion		3,321			5,161
Total current liabilities		193,866			150,883
Deferred revenue, net of current portion		510,346			467,726
Deferred grants, net of current portion		219,380			226,801
Capital lease obligation, net of current portion		7,210			5,761
Line of credit		140,024			48,597
Long-term debt, net of current portion		195,874			188,052
Lease pass-through financing obligation, net of current portion		203,392			180,224
Other liabilities		3,431			2,424
Deferred tax liabilities		145,344			112,597
Total liabilities(1)		1,618,867			1,383,065
Redeemable noncontrolling interests		151,288			135,948
Stockholders’ equity:
Convertible preferred stock, $0.0001 par value—authorized, 57,028 shares as of June 30, 2015 and December 31, 2014, respectively; issued and outstanding, 54,841 and 54,841 shares as of June 30, 2015 and December 31, 2014, respectively; aggregate liquidation value of $305,883 as of June 30, 2015 and December 31, 2014, respectively		5		5
Common stock, $0.0001 par value—authorized, 125,047 and 119,547 shares as of June 30, 2015 and December 31, 2014, respectively; issued and outstanding, 26,503 and 24,429 shares as of June 30, 2015 and December 31, 2014, respectively		2		2
Additional paid-in capital		411,890			383,860
Accumulated other comprehensive loss		1,425		—
Accumulated deficit		(69,458	)		(59,003	)
Total stockholders’ equity		343,864			324,864
Noncontrolling interests		126,731			91,755
Total equity		470,595			416,619
Total liabilities, redeemable noncontrolling interests and total equity	$	2,240,750		$	1,935,632

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Revenue:
Operating leases and incentives	$	34,458		$	22,987		$	56,766		$	41,428
Solar energy systems and product sales		38,232			28,952			65,601			40,914
Total revenue		72,690			51,939			122,367			82,342
Operating expenses:
Cost of operating leases and incentives		27,067			17,359			48,444			32,255
Cost of solar energy systems and product sales		34,624			25,333			59,954			35,808
Sales and marketing		33,976			17,173			58,902			29,762
Research and development		2,492			1,999			4,779			3,926
General and administrative		19,677			20,037			39,983			32,687
Amortization of intangible assets		1,051			655			1,593			1,118
Total operating expenses		118,887			82,556			213,655			135,556
Loss from operations		(46,197	)		(30,617	)		(91,288	)		(53,214	)
Interest expense, net		8,433			6,662			15,563			12,324
Loss on early extinguishment of debt		431			—			431			—
Other expenses		1,019			1,386			1,318			1,846
Loss before income taxes		(56,080	)		(38,665	)		(108,600	)		(67,384	)
Income tax benefit		(6,215	)		(5,917	)		(6,215	)		(10,043	)
Net loss		(49,865	)		(32,748	)		(102,385	)		(57,341	)
Net loss attributable to noncontrolling interests and redeemable noncontrolling interests		(57,405	)		(15,517	)		(91,930	)		(28,389	)
Net income (loss) attributable to common stockholders	$	7,540		$	(17,231	)	$	(10,455	)	$	(28,952	)
Less: Net income allocated to participating securities		(7,540	)		—			—			—
Net income (loss) available to common stockholders	$	—		$	(17,231	)	$	(10,455	)	$	(28,952	)

Net income (loss) per share available to common shareholders—basic and diluted	$	—		$	(0.72	)	$	(0.41	)	$	(1.35	)
Weighted average shares used to compute net loss per share available to common stockholders—basic and diluted		26,215			23,827			25,322			21,437

	Three Months Ended June 30,					Six Months Ended June 30,
	2015		2014			2015			2014
Net income (loss) attributable to common stockholders	$	7,540	$	(17,231	)	$	(10,455	)	$	(28,952	)
Other comprehensive income:
Unrealized gain on derivatives, net of tax expense of $904 for the three months and six months ended June 30, 2015		2,861		—			1,069			—
Less reclassification of net loss on derivatives to earnings		(356)		—			(356)			—
Comprehensive loss	$	10,757	$	(17,231	)	$	(9,030	)	$	(28,952	)

	Six months Ended June 30,
	2015			2014
Operating activities:
Net loss	$	(102,385	)	$	(57,341	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Loss on early extinguishment of debt		431			—
Depreciation and amortization, net of amortization of deferred grants		32,673			22,493
Bad debt expense		739			124
Interest on lease pass-through financing		7,177			4,006
Noncash tax benefit		(6,215	)		(10,043	)
Noncash interest expense		4,443			1,185
Stock—based compensation expense		6,421			4,310
Reduction in lease pass—through financing obligations		(10,379	)		(4,890	)
Changes in operating assets and liabilities:
Accounts receivable		(4,216	)		(740	)
Inventories		(13,890	)		2,993
Prepaid and other assets		(8,615	)		52
Accounts payable		22,751			6,895
Accrued expenses and other liabilities		6,209			710
Deferred revenue		20,254			40,305
Net cash provided by (used in) operating activities		(44,602	)		10,059

Investing activities:
Payments for the costs of solar energy systems, leased and to be leased		(257,806	)		(178,741	)
Purchases of property and equipment		(4,688	)		(3,712	)
Acquisitions of businesses, net of cash acquired		(14,575	)		(36,384	)
Net cash used in investing activities		(277,069	)		(218,837	)

Financing activities:
Proceeds from grants and state tax credits		5,120			107
Proceeds from issuance of debt		153,200			13,546
Repayment of debt		(54,956	)		(2,017	)
Payment of debt fees		(2,801	)		(225	)
Proceeds from issuance of convertible preferred stock, net of issuance costs		—			143,393
Proceeds from lease pass-through financing obligations		52,034			90,387
Contributions received from noncontrolling interests and redeemable noncontrolling interests		155,662			88,000
Distributions paid to noncontrolling interests and redeemable noncontrolling interests		(13,717	)		(20,908	)
Proceeds from exercises of stock options		2,387			1,116
Payment of capital lease obligation		(1,472	)		(502	)
Payments for deferred offering costs		(4,722	)		—
Change in restricted cash		(4,608	)		84
Net cash provided by financing activities		286,127			312,981

Net increase (decrease) in cash and cash equivalents		(35,544	)		104,203
Cash and cash equivalents, beginning of period		152,154			99,699
Cash and cash equivalents, end of period	$	116,610		$	203,902

Supplemental disclosures of cash flow information
Cash paid for interest	$	3,118		$	6,460

Supplemental disclosures of noncash investing and financing activities
Costs of solar energy systems included in accounts payable	$	4,777		$	191
Distributions payable to noncontrolling interests and redeemable noncontrolling interests	$	6,463		$	5,281
Vehicles acquired under capital leases	$	5,255		$	1,051
Noncash purchase consideration on acquisition of business	$	18,718		$	76,964

Sunrun Inc. (“Sunrun” or the “Company”) was originally formed in 2007 as a California limited liability company, and was converted into a Delaware corporation in 2008. The Company is engaged in the design, development, installation sale, ownership, and maintenance of residential solar energy systems (“Projects”) in the United States.

Sunrun acquires customers directly and through relationships with various solar and strategic partners (“Partners”). The Projects are constructed either by Sunrun or by Sunrun’s Partners and are owned by the Company. Sunrun’s customers enter into a power purchase agreement (“PPA”) or a lease (each, a “Customer Agreement”) which typically has a term of 20 years. Sunrun monitors, maintains and insures the Projects. As a result of the acquisition of Mainstream Energy Corporation, its fulfillment business AEE Solar and its racking business SnapNrack (collectively, “MEC”) completed in February 2014, the Company also sells solar energy systems and products to customers.

The Company has formed various subsidiaries (“Funds”) to finance the development of Projects. These Funds, structured as limited liability companies, obtain financing from outside investors and purchase or lease Projects from Sunrun under master purchase or master lease agreements. The Company currently utilizes three legal structures in its investment Funds, which are referred to as: (i) lease pass-throughs, (ii) partnership-flips and (iii) joint venture (“JV”) inverted leases.

The Company completed its initial public offering in August 2015 and its common stock is listed on the NASDAQ under the symbol “RUN”.

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting and, in the opinion of management, include all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position, results of operations, and cash flows. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations. As such, these unaudited consolidated financial statements should be read in conjunction with the Company’s audited financial statements included in the prospectus dated August 4, 2015 filed with the SEC pursuant to Rule 424 promulgated under the Securities Act of 1933, as amended. The results for the three and six months ended June 30, 2015 are not necessarily indicative of the results expected for the year ending December 31, 2015 or for any other interim periods or any other period.

The consolidated financial statements reflect the accounts and operations of the Company and those of its subsidiaries, including Funds, in which the Company has a controlling financial interest. The typical condition for a controlling financial interest ownership is holding a majority of the voting interests of an entity. However, a controlling financial interest may also exist in entities, such as variable interest entities (“VIEs”), through arrangements that do not involve controlling financial interests. In accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 810 (“ASC 810”) Consolidation, the Company consolidates any VIE of which it is the primary beneficiary. The primary beneficiary, as defined in ASC 810, is the party that has (1) the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance and (2) the obligation to absorb the losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company evaluates its relationships with its VIEs on an ongoing basis to determine whether it continues to be the primary beneficiary. The consolidated financial statements reflect the assets and liabilities of VIEs that are consolidated. All intercompany transactions and balances have been eliminated in consolidation.

Certain prior period amounts have been reclassified to conform to current period presentation.

The preparation of the consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The Company regularly makes significant estimates and assumptions, including, but not limited to, the estimates that affect the collectability of accounts receivable, the valuation of inventories, the useful lives and estimated residual values of solar energy systems, the useful lives of property and equipment, the valuation and useful lives of intangible assets, the fair value of assets acquired and liabilities assumed in business combinations, the effective interest rate used to amortize lease pass-through financing obligations, the valuation of stock-based compensation, the valuation of the Company’s common stock, the determination of valuation allowances associated with deferred tax assets, fair value of debt instruments disclosed and the redemption value of redeemable noncontrolling interests. The Company bases its estimates on historical experience and on various other assumptions believed to be reasonable. Actual results may differ from such estimates.

The Company has one operating segment with one business activity, providing solar energy services and products to customers. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who manages operations on a consolidated basis for purposes of allocating resources. When evaluating performance and allocating resources, the CODM reviews financial information presented on a consolidated basis.

Revenues from external customers for each group of similar products and services are as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2015		2014		2015		2014
Operating leases	$	22,915	$	16,788	$	40,047	$	29,417
Incentives		11,543		6,199		16,719		12,011
Operating leases and incentives		34,458		22,987		56,766		41,428
Solar energy systems		7,028		5,741		12,834		8,093
Products		31,204		23,211		52,767		32,821
Solar energy systems and product sales		38,232		28,952		65,601		40,914
Total revenue	$	72,690	$	51,939	$	122,367	$	82,342

The Company defines fair value as the exchange price that would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. FASB establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows:

The Company’s financial instruments include cash and cash equivalents, receivables, accounts payable, accrued expenses, distributions payable to noncontrolling interests, derivatives, borrowings on the line of credit, and long term debt.

In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 Revenue from Contracts with Customers (Topic 606), to replace the existing revenue recognition criteria for contracts with customers and to establish the disclosure requirements for revenue from contracts with customers. The core principle of this standard is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. This ASU is effective for the Company for annual reporting periods beginning after December 15, 2017 including the interim reporting periods within that fiscal year, and early adoption is permitted. Adoption of the ASU is either retrospective to each prior period presented or retrospective with a cumulative adjustment to retained earnings or accumulated deficit as of the adoption date. The Company is currently assessing the impact of this guidance on its consolidated financial statements.

In November 2014, the FASB issued ASU 2014-16 Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share is More Akin to Debt or to Equity. This guidance requires issuers and investors to consider all of a hybrid instrument’s stated and implied substantive terms and features, including any embedded derivative features being evaluated for bifurcation. The guidance eliminates the “chameleon approach”, under which all embedded features except the feature being analyzed are considered. The guidance is effective for the year beginning after December 15, 2015 and for interim periods within fiscal years beginning after December 15, 2016. Early adoption is permitted. The Company believes the adoption of this guidance will have no impact on its consolidated financial statements.

In November 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern, which provides guidance on determining when and how to disclose going-concern uncertainties in the financial statements. The new standard requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date of issuance of the entity’s financial statements and provide certain disclosures when there is substantial doubt about the entity’s ability to continue as a going concern. This guidance applies to all entities and is effective for annual periods beginning after December 15, 2015, and interim periods thereafter, with early adoption permitted. The Company believes the adoption of this guidance will have no impact on its consolidated financial statements.

In February 2015, the FASB issued ASU 2015-02 Amendments to the Consolidation Analysis, which provides consolidation guidance and changes the way reporting enterprises evaluate consolidation for limited partnerships, investment companies and similar entities, as well as variable interest entities. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2015. The Company is currently evaluating this guidance and the impact it may have on its consolidated financial statements.

In April 2015, the FASB issued ASU 2015-03, Interest—Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs, to simplify the presentation of debt issuance costs. Prior to ASU 2015-03, issuance costs were presented as an asset on the balance sheet. Under ASU 2015-03, debt issuance costs related to a recognized debt liability are required to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this update. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2015 and interim periods within those fiscal years. The Company is currently evaluating this guidance and the impact it may have on its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory, to specify that inventory should be subsequently measured at the lower of cost or net realizable value, which is the ordinary selling price less any completion, transportation and disposal costs. However, the ASU does not apply to inventory measured using the last-in-first-out or retail methods. The ASU is effective for interim and annual periods beginning after December 15, 2016. Adoption of the ASU is prospective. The Company is currently evaluating this guidance and the impact it may have on its consolidated financial statements.

In April 2015, the Company acquired Clean Energy Experts, LLC (“CEE”), a consumer demand and solar lead generation company, for $25.0 million in cash and 1.9 million shares of common stock. Of this amount, $15.0 million in cash was paid and 1.4 million shares were issued in April 2015. The remaining $10.0 million in cash and 500,000 shares are due in two equal installments: $5.0 million will be paid and 250,000 shares will be issued in October 2015 and again in April 2016. The fair value of assets acquired and liabilities assumed was based upon a preliminary valuation and our

estimates and assumptions are subject to change within the measurement period. The primary area of the purchase price that is contingent upon future events relate to indemnification for potential tax liability.

An additional $9.1 million in cash and 600,000 shares of common stock may be issued on April 1, 2017, subject to the achievement of certain sales targets as well as continued employment of certain key employees acquired in the transaction, which will be recorded as compensation expense over a two-year period unless and until the Company assesses the sales targets are not considered probable of achievement. The acquisition is expected to enhance the Company’s efficient and consistent access to high-quality leads in existing and new markets.

The Company has included the results of operations of the acquired business in the consolidated statements of operations from the acquisition date. The assets acquired and liabilities assumed in the CEE acquisition have been recorded based on their fair value at the acquisition date. Goodwill represents the excess of the purchase price over the net tangible and intangible assets acquired and is not deductible for tax purposes. Goodwill recorded is primarily attributable to the acquired assembled workforce and the synergies expected to arise after the CEE acquisition. Transaction costs related to the acquisition were expensed as incurred.

The following table summarizes the fair value of assets acquired and liabilities assumed (in thousands):

The fair value of acquired intangible assets and their estimated useful life are as follows (in thousands, except estimated useful life):

For the three and six months ended June 30, 2015, the contribution of the acquired business to the Company’s total revenues was $4.1 million as measured from the date of the acquisition. The portion of total expenses and net income associated with the acquired business was not separately identifiable due to the integration with the Company’s operations.

At June 30, 2015 and December 31, 2014, the carrying value of receivables, accounts payable, accrued expenses, and distributions payable to noncontrolling interests approximates fair value due to their short-term nature. The carrying values and fair values of debt instruments are as follows (in thousands):

	June 30, 2015				December 31, 2014
	Carrying Value		Fair Value		Carrying Value		Fair Value
Line of credit	$	140,024	$	140,024	$	48,597	$	48,597
Non-bank term loans		—		—		3,138		3,853
Bank term loan		32,219		34,248		33,382		35,653
Note payable		31,346		30,827		29,563		28,900
Syndicated term loans		134,133		134,133		124,571		124,571
Total	$	337,722	$	339,231	$	239,251	$	241,574

At June 30, 2015 and December 31, 2014, the fair value of the Company’s lines of credit and the syndicated term loans approximates their carrying values because their interest rates are variable rates that approximate rates currently available to the Company. At June 30, 2015, the fair value of the Company’s bank term loan and note payable are based on rates currently offered for debt with similar maturities and terms. At December 31, 2014, the fair value of the Company’s non-bank term loan, bank term loan, and note payable are based on rates currently offered for debt with similar maturities and terms. The Company’s fair value of the debt instruments fell under the Level 3 hierarchy. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market.

The Company determines the fair value of its derivative instruments using a discounted cash flow model which incorporates an assessment of the risk of non-performance by the interest rate swap counterparty and an evaluation of the Company’s credit risk in valuing derivative instruments. The valuation model uses various inputs including contractual terms, interest rate curves, credit spreads and measures of volatility. At June 30, 2015 and December 31, 2014, financial instruments measured at fair value on a recurring basis, based upon the fair value hierarchy are as follows (in thousands):

All solar energy systems, construction-in-progress, and inverters have been leased to or are subject to a signed Customer Agreement with customers. The Company recorded depreciation expense related to solar energy systems of $16.5 million and $32.0 million for the three and six months ended June 30, 2015, respectively, and $12.9 million and $24.9 million for the three and six months ended June 30, 2014, respectively. The depreciation expense was reduced by the amortization of deferred grants of $3.5 million and $7.1 million for the three and six months ended June 30, 2015, respectively, and $3.5 million and $6.9 million for the three and six months ended June 30, 2014, respectively.

Intangible assets, net as of June 30, 2015 consist of the following (in thousands):

								Weighted
								average
			Accumulated			Carrying		remaining life
	Cost		amortization			value		(in years)
Backlog	$	200	$	(200	)	$	—		—
Customer relationships		14,660		(1,768	)		12,892		7.8
Developed technology		6,820		(553	)		6,267		4.6
Trade names		6,990		(1,341	)		5,649		5.7
Total	$	28,670	$	(3,862	)	$	24,808

Intangible assets, net as of December 31, 2014 consist of the following (in thousands):

								Weighted
								average
			Accumulated			Carrying		remaining life
	Cost		amortization			value		(in years)
Backlog	$	200	$	(183	)	$	17		0.1
Customer relationships		10,270		(1,055	)		9,215		8.4
Developed technology		910		(167	)		743		4.1
Trade names		4,000		(864	)		3,136		4.1
Total	$	15,380	$	(2,269	)	$	13,111

The Company recorded amortization of intangible assets expense of $1.1 million and $1.6 million for the three and six months ended June 30, 2015, respectively, and $0.7 million and $1.1 million for the three and six months ended June 30, 2014, respectively.

							Unused		Annual
	Carrying Values, net of						Borrowing		Contractual	Interest			Maturity
	debt discount						Capacity		Interest Rate	Rate			Date
	Current		Long Term		Total
Recourse debt:
Bank line of credit	$	—	$	140,024	$	140,024	$	44,630	LIBOR + 3.25%		3.69	%	April 2018
Total recourse debt	$	—	$	140,024	$	140,024	$	44,630

Non-recourse debt:

Large accelerated filer	¨		Accelerated filer	¨

Non-accelerated filer	x	(Do not check if a smaller reporting company)	Smaller reporting company	¨

	PART I – FINANCIAL INFORMATION	Page
Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets	3
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Loss	6
	Consolidated Statements of Cash Flows	7
	Notes to Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36
Item 4.	Controls and Procedures	36

	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	60
Item 6.	Exhibits	61
	Signatures	62

Cash and cash equivalents	$	424
Accounts receivable		639
Intangible assets		13,290
Accounts payable and accrued liabilities		(1,247	)
Deferred tax liability		(5,158	)
Indentifiable assets and liabilities assumed		7,948
Goodwill		35,769
Total	$	43,717

	June 30, 2015		December 31, 2014
Raw materials	$	35,336	$	21,531
Work-in-process		2,468		2,383
Total	$	37,804	$	23,914

	June 30, 2015			December 31, 2014
Solar energy system equipment costs	$	1,610,120		$	1,406,478
Inverters		148,714			123,910
Initial direct costs		48,809			36,279
Total solar energy systems		1,807,643			1,566,667
Less: accumulated depreciation and amortization		(176,161	)		(143,028	)
Add: construction-in-progress		64,246			56,584
Total solar energy systems, net	$	1,695,728		$	1,480,223

	Fair Value		Estimated Useful Life
Developed technology	$	5,910	5
Customer relationships		4,390	8
Trade names		2,990	8
Total	$	13,290

	June 30, 2015								December 31, 2014
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Derivative assets	$	—	$	2,329	$	—	$	2,329	$	—	$	—	$	—	$	—

Balance—December 31, 2014	$	51,786
Acquisition of CEE (Note 3)		35,769
Balance—June 30, 2015	$	87,555