SUNation Energy Inc. (NASDAQ: SUNE) announced its board approved a debt-to-equity conversion that will reduce long-term debt by approximately $1.2 million, according to a company statement.

The solar energy company will issue about 677,000 shares of restricted common stock to retire debt under a senior secured promissory note held by its chief executive officer and chief financial officer. The shares will be issued at $1.77 per share, representing a 10% premium to the April 13, 2026 closing price.

The restricted shares will represent approximately 19.9% of the company's outstanding public float and will be subject to a 180-day lock-up period from issuance. The transaction requires final documentation and customary closing conditions to complete.

SUNation said the conversion will reduce monthly debt service requirements through September 2026 and is part of efforts to strengthen its balance sheet while exploring strategic transactions announced on April 9, 2026.

The company noted it has eliminated approximately $14 million in other short and long-term debt obligations over the past 14 months. SUNation provides residential and commercial solar energy systems, battery storage solutions, and energy services.

The company stated it does not plan to provide additional updates on its strategic review process unless the board approves a specific course of action or determines additional disclosure is necessary.