NOTE 4 — DISCONTINUED OPERATIONS

On April 30, 2026, (the “Closing Date”) Broadwind Heavy Fabrications, Inc. (“BHF”), a wholly owned subsidiary of the Company, entered into a Purchase and Sale Agreement (the “Purchase Agreement”) with Freeman Enclosure Systems, LLC (the “Buyer”), a wholly-owned subsidiary of IES Holdings, Inc., pursuant to which BHF sold the real property and certain assets contained therein which comprise the Company’s production facility located in Abilene, Texas (the “Facility”), including equipment, machinery, other personal property, specified service contracts, and permits (collectively, the “Purchased Assets”), to the Buyer for an aggregate purchase price of up to $19,500 in cash, subject to certain purchase price adjustments, (the “Transaction”). The Company received net cash proceeds of $17,154 on the sale of the Transaction. On the Closing Date, BHF also entered into a short term lease agreement with the Buyer, pursuant to which (a) BHF leased the Facility and the Purchased Assets back from the Buyer (the “Lease”) for a nominal below-market rent for a term that is expected to end on September 5, 2026 and (b) the Buyer received an option to purchase certain excluded manufacturing equipment located in the Facility at a future date. The Lease was entered into for the limited purpose of completing existing customer contracts, fulfilling remaining wind tower manufacturing obligations, and facilitating an orderly wind-down and transition of the wind fabrication operations. Cash inflows and outflows associated with this continuing involvement consist primarily of operating cash flows generated from completing remaining wind tower contracts, employee-related costs, inventory liquidation activities, and other transition-related expenditures incurred through the termination of the leaseback period. Net cash inflows associated with this continuing involvement total $3,116 for the period from May 1, 2026 through June 30, 2026. The Company recorded a prepaid asset related to the below-market rent as of April 30, 2026. The asset is being amortized over the remaining lease term and is included in the “Current assets-discontinued operations” line item of the Company’s condensed consolidated balance sheets as of June 30, 2026. The sale of the Abilene facility resulted in a loss of $224 for the three and six months ended June 30, 2026 and is included in the “Income from discontinued operations, net of tax” line item in the Company’s condensed consolidated statement of operations. The second quarter results also include a $1,106 charge associated with a contract dispute related to the Company’s former Heavy Fabrications segment. This charge is included in the “Income from discontinued operations, net of tax” line item in the Company’s condensed consolidated statement of operations. 

The Abilene sale transaction represented the Company’s exit from the wind and industrial fabrications business and the Company determined this was a strategic shift that will have a major effect on the Company’s operations and as a result, certain impacted operations qualified for discontinued operations treatment in the second quarter of 2026. As a result of this analysis, the results of operations of the wind and industrial fabrication operations, including operations historically in Manitowoc, Wisconsin, have been reclassified to discontinued operations on the condensed consolidated statements of operations and retrospectively for all periods presented beginning in the second quarter of 2026. In addition, the discontinued assets and liabilities are presented separately on the Company’s condensed consolidated balance sheets for both current and prior periods beginning in the second quarter of 2026. The Company’s discontinued operations exclude the results of PRS operations.

Results of Discontinued Operations

Results of discontinued operations in the Company’s condensed consolidated statement of operations for the three and six months ended June 30, 2026 and 2025, were as follows:

Assets and Liabilities Related to Discontinued Operations

Assets and liabilities related to discontinued operations in the Company’s consolidated balance sheets as of June 30, 2026 and December 31, 2025 includes the following: