Note 7 — Revenue recognition

Revenue on solar projects sold to Thrive Power LLC is recognized under ASC 606 over time at the contractual milestones (notice to proceed, design, permit, install, permission to operate). This reflects management’s written representation, dated July 13, 2026, that every project on the revenue recognition schedule has been approved in Thrive underwriting and has achieved notice to proceed; corroborating documentation (per-project Thrive approvals, notices to proceed, and the dealer-agreement terms establishing an enforceable right to payment for performance to date) has been requested and remains subject to securities-counsel and auditor review. Management has further clarified in writing that the schedule’s quarter marks denote calendar quarters; accordingly all milestone revenue is attributed to the three months ended March 31, 2026, pending written confirmation of the meaning of the “X” marks — year-to-date amounts are unaffected by this attribution. Amounts recognized ahead of Thrive settlement are carried as contract assets ($1,172,274 at March 31, 2026, presented within accounts receivable and contract assets); subsequent Thrive settlements of these projects will be applied against the contract asset and not recorded as revenue. Four underwriting-rejected projects are excluded from revenue and their capitalized costs impaired (Note 5). Prosper Energy's revenue comprises solar referral commissions, installer partner revenue and related items, included on the normalized basis described in Note 4.