Sunlight recognizes receivables primarily related to (a) advances that Sunlight remits to contractors to facilitate the installation of residential solar and home improvement equipment and (b) loans and loan participations. Loans and loan participations primarily include Sunlight’s undivided 5.0% participation in certain Indirect Channel Loans and Indirect Channel Loans purchased from its Bank Partner. The following tables summarize Sunlight’s financing receivables and changes thereto:


	Advances(a)		Loans and Loan Participations(b)		Total

March 31, 2022 (Successor)
Amounts outstanding	$	86,590	$	4,568		$	91,158
Unamortized discount	—		(369)			(369)
Allowance for credit losses	(505)		(73)			(578)
Carrying value	$	86,085	$	4,126		$	90,211
December 31, 2021 (Successor)
Amounts outstanding	$	67,077	$	4,875		$	71,952
Unamortized discount	—		(414)			(414)
Allowance for credit losses	(238)		(148)			(386)
Carrying value	$	66,839	$	4,313		$	71,152

a.Represents advance payments made by Sunlight to certain contractors, generally on a short-term basis, in anticipation of a project’s substantial completion, including advances of $10.5 million and $9.0 million to Sunlight contractors not associated with specific installation projects at March 31, 2022 and December 31, 2021, respectively.

b.Represents (i) Sunlight’s 5.0% participation interest in a pool of residential solar loans with an aggregate UPB of $4.3 million and $4.6 million at March 31, 2022 and December 31, 2021, respectively, and (ii) Indirect Channel Loans purchased by Sunlight with an aggregate UPB of $0.3 million and $0.3 million at March 31, 2022 and December 31, 2021, respectively. No loans or loan participations were individually evaluated for impairment at March 31, 2022 or December 31, 2021.


	Successor			Predecessor

	For the Three Months Ended March 31,		For the Three Months Ended March 31,
	2022			2021
Allowance for Credit Losses — Advances
Beginning Balance	$	238		$	121
Provision for credit losses	267			(20)
Realized losses	—			—
Ending Balance	$	505		$	101

Allowance for Credit Losses — Loans and Loan Participations
Beginning Balance	$	148		$	125
Provision for credit losses	371			756
Realized losses	(446)			(767)
Ending Balance	$	73		$	114

Changes in Carrying Value — Loans and Loan Participations
Beginning Balance	$	4,313		$	5,333
Purchases, net(a)	448			842
Proceeds from principal repayments, net	(307)			(419)
Accretion of loan discount	43			65
Provision for credit losses	(371)			(756)
Ending Balance	$	4,126		$	5,065

a.During the three months ended March 31, 2021, Sunlight purchased (i) 5.0% participation interests in 54 loans with an aggregate UPB of $0.1 million as well as (ii) 34 Indirect Channel Loans with an aggregate UPB $0.8 million. During three months ended March 31, 2022, Sunlight purchased 24 Indirect Channel Loans with an aggregate UPB of $0.5 million, respectively.

Risk Ratings — As further described in Note 2, management evaluates Sunlight’s advances for impairment using risk ratings assigned on a scale of “1” (low risk) through “5” (higher risk). The following table allocates the advance amount outstanding based on Sunlight’s internal risk ratings:


		Total
Risk Tier(a)		Contractors	Amount Outstanding		% of Amount Outstanding
March 31, 2022 (Successor)
1	Low risk	88	$	12,363	14.3	%
2	Low-to-medium risk	97	50,358		58.2
3	Medium risk	52	23,837		27.5
4	Medium-to-high risk	1	32		—
5	Higher risk	—	—		—
		238	$	86,590	100.0	%
December 31, 2021 (Successor)
1	Low risk	76	$	14,575	21.7	%
2	Low-to-medium risk	77	38,955		58.1
3	Medium risk	17	13,547		20.2
4	Medium-to-high risk	—	—		—
5	Higher risk	—	—		—
		170	$	67,077	100.0	%

a.At March 31, 2022 and December 31, 2021, the average risk rating of Sunlight’s advances was 2.1 (“low-to-medium”) and 2.0 (“low-to-medium risk”), weighted by total advance amounts outstanding.


Payment Delinquency	Amount Outstanding(a)		% of Amount Outstanding
March 31, 2022 (Successor)
Current	$	67,061	88.1	%
Less than 30 days	4,459		5.9
30 days	2,343		3.1
60 days	1,086		1.4
90+ days(b)	1,151		1.5
	$	76,100	100.0	%
December 31, 2021 (Successor)
Current	$	54,586	94.0	%
Less than 30 days	1,956		3.4
30 days	534		0.9
60 days	361		0.6
90+ days(b)	640		1.1
	$	58,077	100.0	%

a.Excludes advances of $10.5 million and $9.0 million to Sunlight contractors not associated with specific installation projects and was not delinquent at March 31, 2022 and December 31, 2021, respectively.

b.As further discussed in Note 2, Sunlight generally evaluates amounts delinquent for 90 days or more for impairment. Advances to contractors may remain outstanding as a result of operational and various other factors that are unrelated to the contractor’s creditworthiness. Sunlight assessed advances 90 days or more, along with other factors that included the contractor’s risk tier and historical loss experience, and established loss allowances of $0.5 million and $0.2 million at March 31, 2022 and December 31, 2021, respectively.


	Successor
	March 31, 2022				December 31, 2021
Contractor	Amount Outstanding		% of Total		Amount Outstanding		% of Total
1	$	23,011	26.6	%	$	12,470	18.6	%
2	20,549		23.7		20,894		31.1
3	10,227		11.8		9,496		14.2
4	6,035		7.0		1,745		2.6
5	3,341		3.9		2,093		3.1
6	3,059		3.5		2,610		3.9
7	2,705		3.1		2,571		3.8
8	1,528		1.8		—		—
9	745		0.9		278		0.4
10	600		0.7		855		1.3
Other(a)	14,790		17.0		14,065		21.0
	$	86,590	100.0	%	$	67,077	100.0	%

a.At March 31, 2022 and December 31, 2021, Sunlight recorded advances receivable from 228 and 160 counterparties not individually listed in the table above with average balances of $0.1 million and $0.1 million, respectively. At December 31, 2021, Sunlight recorded advances receivable from individual counterparties of $0.6 million, $0.6 million, $0.5 million, $0.5 million, and $0.4 million that represent the largest advance concentrations included in “Other,” based on the amount outstanding.

Loans and Loan Participations — The following section presents certain characteristics of Sunlight’s investments in loans and loan participations. Unless otherwise indicated, loan participation amounts are shown at Sunlight’s 5% interest in the underlying loan pool.


Payment Delinquency(a)	Loan Participations			Bank Partner Loans			Total
	Loans	UPB		Loans	UPB		Loans	UPB		% of UPB
March 31, 2022 (Successor)
Current	3,622	$	4,137	16	$	288	3,638	$	4,425	96.9	%
Less than 30 days	82	109		—	—		82	109		2.4
30 days	14	16		—	—		14	16		0.4
60 days	4	4		—	—		4	4		0.1
90+ days	7	14		—	—		7	14		0.2
	3,729	$	4,280	16	$	288	3,745	$	4,568	100.0	%
December 31, 2021 (Successor)
Current	3,780	$	4,442	14	$	268	3,794	$	4,710	96.6	%
Less than 30 days	73	96		1	11		74	107		2.2
30 days	15	23		—	—		15	23		0.5
60 days	10	14		—	—		10	14		0.3
90+ days	7	9		1	12		8	21		0.4
	3,885	$	4,584	16	$	291	3,901	$	4,875	100.0	%

a.As further described in Note 2, Sunlight places loans delinquent greater than 90 days on nonaccrual status. Such loans had carrying values of $0.0 million and $0.0 million at March 31, 2022 and December 31, 2021, respectively. Sunlight does not consider the average carrying values and interest income recognized (including interest income recognized using a cash-basis method) material.

Loan Collateral Concentrations — The following table presents the UPB of Balance Sheet Loans, including Sunlight’s relevant participation percentage of the Indirect Channel Loans underlying the participation interests held by Sunlight, based upon the state in which the borrower lived at the time of loan origination:


	Successor
	March 31, 2022				December 31, 2021
State	UPB		% of Total		UPB		% of Total
Texas	$	870	19.0	%	$	930	19.1	%
California	819		17.9		867		17.8
Florida	391		8.6		423		8.7
New York	305		6.7		325		6.7
New Jersey	284		6.2		302		6.2
Arizona	205		4.5		220		4.5
Massachusetts	194		4.2		201		4.1
Pennsylvania	186		4.1		202		4.1
South Carolina	166		3.6		178		3.7
Missouri	129		2.8		135		2.8
Other(a)	1,019		22.4		1,092		22.3
	$	4,568	100.0	%	$	4,875	100.0	%

a.Sunlight only participates in residential solar loans originated within the United States, including 31 and 31 states not individually listed in the table above, none of which individually amount to more than 2.6% and 2.6% of the UPB at March 31, 2022 and December 31, 2021, respectively.