What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2026-03-12 compared with 2025-03-13 · 165 added, 176 removed, 570 unchanged (37% of the section changed)

12 unchanged sentences

and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, stockholders' equity, and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 13, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with applicable accounting principles generally accepted in the United States of America.

Basis for Opinion

1 unchanged sentence

Our responsibility is to express an opinion on the Company's financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

1 unchanged sentence

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

7 unchanged sentences

Critical Audit Matter Description

As discussed in Note 1 to the consolidated financial statements, revenue is recognized upon the customer obtaining control of promised goods or services, in an amount that reflects the consideration which is expected to be received in exchange for those goods or services.

As discussed in Note 1 to the consolidated financial statements, revenue is recognized upon the customer obtaining control of promised goods or services in an amount that reflects the consideration which is expected to be received in exchange for those goods or services, which generally reflects the amount the Company has the right to invoice.

As most projects are not billed until completion, the Company accrues revenue at the end of each month for jobs that are on-going and have not been invoiced.

1 unchanged sentence

The amount to be recorded is dependent upon estimates prepared by management.

We identified the estimated accrued revenue as a critical audit matter due to the subjectivity inherent and degree of judgment made by management in estimating the amount to be accrued.

We identified the estimated accrued revenue as a critical audit matter due to the inherent subjectivity and degree of judgment made by management in estimating the amount to be accrued.

How the Critical Audit Matter Was Addressed in the Audit

1 unchanged sentence

• We evaluated the reasonableness of the Company’s policies for recording the accrual including whether there were changes in those policies in the current year.

• We tested the effectiveness of internal controls over accrued revenue, including (1) the process to estimate the revenue accrual, including the assumptions related to status of jobs on-going at the date of the accrual, and (2) management's analysis of the actual revenue invoiced in the subsequent period compared to the amount accrued for at year-end.

• We tested the design and implementation of internal controls over accrued revenue, including (1) the process to estimate the revenue accrual, including the assumptions related to status of jobs on-going at the date of the accrual, and (2) management’s analysis of the actual revenue invoiced in the subsequent period compared to the amount accrued for at year-end.

• We evaluated the reasonableness of the assumptions and degree of judgment utilized in the determination of the accrual, tested the source of information used to estimate the accrual, and validated the mathematical accuracy of management’s calculation.

27 unchanged sentences

Accrued liabilities 26.0 41.3

Current portion of long-term debt 4.4 —

Current portion of operating lease liabilities 7.1 6.9

5 unchanged sentences

Other non-current liabilities 1.1 1.7

Commitments, contingencies and off-balance sheet arrangements (Note 10)

Commitments and contingencies (Note 9)

Stockholders’ equity:

6 unchanged sentences

Accumulated deficit ( 639.5 ) ( 562.4 )

Total stockholders’ (deficit) equity ( 10.5 ) 38.8

Total liabilities and stockholders' equity $ 456.3 $ 539.8

Total stockholders’ deficit ( 74.2 ) ( 10.5 )

Total liabilities and stockholders' deficit $ 340.3 $ 456.3

(1) Includes right-of-use ("ROU") assets - finance leases.

13 unchanged sentences

Impairment and other charges — 0.1

Bargain purchase gain — ( 1.9 )

Operating (loss) income ( 15.5 ) 56.9

Operating loss ( 30.3 ) ( 15.5 )

Non-operating expense:

1 unchanged sentence

Interest expense 45.2 39.4

Net (loss) income before income tax ( 52.4 ) 22.2

Loss on debt extinguishment 1.2 —

Net loss before income tax ( 76.3 ) ( 52.4 )

Income tax expense 0.8 0.6

Net (loss) income $ ( 53.0 ) $ 19.2

Net (loss) income per share-basic $ ( 3.27 ) $ 1.23

Net (loss) income per share-diluted $ ( 3.27 ) $ 1.22

Net loss $ ( 77.1 ) $ ( 53.0 )

Net loss per share-basic $ ( 4.12 ) $ ( 3.27 )

Net loss per share-diluted $ ( 4.12 ) $ ( 3.27 )

See accompanying notes to consolidated financial statements.

11 unchanged sentences

Purchase of treasury stock — — — ( 0.5 ) — ( 0.5 )

Greene's acquisition 2.4 — 34.0 — — 34.0

Issuance of Common Stock, net of cost 0.6 0.1 0.5 — — 0.6

Net income — — — — 19.2 19.2

Net loss — — — — ( 53.0 ) ( 53.0 )

Balance at December 31, 2024

3 unchanged sentences

Issuance of Common Stock, net of cost 0.6 0.0 0.3 — — 0.3

Issuance of warrants — — 11.0 — — 11.0

Exercise of warrants 0.8 0.0 0.0 — — —

Net loss — — — — ( 77.1 ) ( 77.1 )

7 unchanged sentences

Cash flows from operating activities:

Net (loss) income $ ( 53.0 ) $ 19.2

Adjustments to reconcile net income (loss) to net cash flows from operating activities

Net loss $ ( 77.1 ) $ ( 53.0 )

Adjustments to reconcile net loss to net cash flows from operating activities

Depreciation and amortization 95.2 94.0

Impairment and other charges 0.1 —

Non-cash compensation 2.6 3.9

2 unchanged sentences

Gain on disposal of property, equipment and other ( 11.0 ) ( 11.9 )

Bargain purchase gain — ( 1.9 )

Non-cash interest expense 16.6 —

Loss on debt extinguishment 1.2 —

Other 0.7 ( 0.6 )

8 unchanged sentences

Purchases of property and equipment ( 49.1 ) ( 65.1 )

Proceeds from sale of property and equipment 14.0 16.3

Cash from acquisition — 1.1

Proceeds from sale of property and equipment and other 16.2 14.0

Net cash flows used in investing activities ( 32.9 ) ( 51.1 )

Cash flows from financing activities:

Proceeds from stock issuance, net of costs ( 0.4 ) ( 0.4 )

Borrowings under 2028 ABL Facility 139.0 —

Repayments on 2028 ABL Facility ( 103.0 ) —

Repayments on Prior ABL Facility ( 50.0 ) —

Proceeds from issuance of 2030 Senior Notes and warrants 225.2 —

Repayment of 2025 Senior Notes ( 236.3 ) —

Mandatory redemption on 2030 Senior Notes ( 4.8 ) —

Payments on finance lease obligations ( 19.9 ) ( 21.6 )

8 unchanged sentences

Supplemental disclosures of cash flow information:

Cash paid during period for:

Income taxes paid, net of refunds $ 3.3 $ 0.6

Interest 37.1 35.0

Cash paid during period for interest 27.8 37.1

Supplemental schedule of non-cash activities:

Accrued capital expenditures 9.1 12.7

Acquisition of Greene's Energy Group, LLC — ( 32.9 )

Issuance of KLX stock for Acquisition of Greene's Energy Group, LLC — 34.0

Non-cash interest expense (paid in kind) 16.6 —

Debt-for-equity exchanges — 1.0

6 unchanged sentences

KLX Energy Services Holdings, Inc.

(the “Company”, “KLXE” or “KLX Energy Services”) is a growth-oriented provider of diversified oilfield services to leading onshore oil and natural gas exploration and production (“E&P”) companies operating in both conventional and unconventional plays in all of the active major basins throughout the United States.

(the “Company”, “KLXE” or “KLX Energy Services”) is a growth-oriented provider of diversified oilfield services to leading onshore oil and natural gas exploration and production (“E&P”) companies operating in both conventional and unconve ntional plays in all of the active major basins throughout the United States.

The Company delivers mission critical oilfield services focused on drilling, completion, production and intervention activities for the most technically demanding wells in over 60 service and support facilities located throughout the United States.

13 unchanged sentences

Revenue Recognition

Revenue is recognized upon the customer obtaining control of promised goods or services, in an amount that reflects the consideration which is expected to be received in exchange for those goods or services.

To determine revenue recognition for arrangements within the scope of Accounting Standards Codification (“ASC”) Topic 606, the following five steps are performed:

5 unchanged sentences

Revenue is recognized in the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

Service revenues are recorded over time throughout and for the duration of the service period pursuant to a

master services agreement combined with a completed field ticket or a work order.

Service revenues are recorded over time throughout and

for the duration of the service period pursuant to a master services agreement combined with a completed field ticket or a work order.

Revenues from product sales are recognized when the customer obtains control of the product, which occurs at a point in time, typically upon delivery in accordance with the terms of the field ticket or work order.

25 unchanged sentences

Property and equipment is stated at cost and depreciated under the straight-line method over the estimated useful life of the asset.

Equipment held under finance leases is stated at the present value of its future

minimum lease payments and is depreciated under the straight-line method over the shorter of the lease term or the estimated useful life of the asset.

Estimated useful lives requires significant judgment which is influenced by our historical experience in operating property and equipment, technological developments, and expectations of future demand.

Equipment held under finance leases is stated at the present value of its future minimum lease payments and is depreciated under the straight-line method over the shorter of the lease term or the estimated useful life of the asset.

Estimating useful lives of property and equipment requires significant judgment which is influenced by our historical experience in operating property and equipment, technological developments, and expectations of future demand.

Intangible Assets, Net

10 unchanged sentences

The Company capitalizes certain third-party fees directly related to the issuance of debt and amortizes these costs over the life of the debt using the effective interest method.

Debt issuance costs related to the Prior ABL Facility (as defined below) are presented net of amortization as a non-current asset.

Debt issuance costs related to the Company’s $ 236.3 principal amount of 11.5 % senior secured notes due 2025 (the “2025 Senior Notes”) are presented net of amortization as an offset to the liability.

Amortized debt issuance costs are included in interest expense and totaled $ 2.6 and $ 1.8 for the years ended December 31, 2024 and December 31, 2023, respectively.

Debt issuance costs related to the Prior ABL Facility and the 2028 ABL Facility are presented net of amortization as a non-current asset.

Debt issuance costs related to the Company’s senior secured notes due 2030 (the “2030 Senior Notes”) and senior secured notes due 2025 (the “2025 Senior Notes”) are presented net of amortization as an offset to the liability.

Amortized debt issuance costs are included in interest expense and totaled $ 2.3 for the year ended December 31, 2025 and $ 2.6 for the year ended December 31, 2024.

Original Issue Discount

The Company capitalizes the original issue cash discount and the original issue warrant discount, both related to the 2030 Senior Notes, and amortizes these costs over the life of the debt using the effective interest method.

These discounts are presented net of amortization as an offset to the liability.

Discount amortization is included in interest expense and totaled $ 2.4 for the year ended December 31, 2025 and $ — for the year ended December 31, 2024.

Common Stock Equivalents

8 unchanged sentences

The Company’s management performs ongoing credit evaluations on the financial condition of all of its customers and maintains allowances for uncollectible accounts receivable based on expected collectability.

Credit losses have historically been within management’s expectations and the provisions established.

Credit losses have historically been within management’s expectations and the provisions established, see " Accounts Receivable, Net" above.

Significant customers change from year to year depending on the level of E&P activity and the use of the Company’s services.

1 unchanged sentence

NOTE 2 - Recent Accounting Pronouncements

Recently Adopted Accounting Standard Updates

In December 2023, FASB issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740).

This ASU includes specific requirements for the rate reconciliation, income taxes paid and other tax-related disclosures.

The guidance is effective for the Company for the fiscal year beginning January 1, 2025 and is not expected to have a material impact on the Company’s consolidated financial statements.

Recently Adopted Accounting Standard Updates

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280).

This ASU is intended to enhance reportable segment disclosures by adopting a number of provisions currently in Regulation S-X and Regulation S-K upon the provisions' removal from these regulations.

This guidance has been adopted as of this Form 10-K for the year ended December 31, 2024.

Note that while Note 14 - Segment Reporting has been updated to comply with the guidance provisions, there is no material impact on the Company’s consolidated financial statements.

NOTE 3 - Business Combinations

On March 8, 2023, KLXE acquired all of the equity interests of Greene's Energy Group, LLC (“Greene’s”), in an all-stock transaction (“Greene's Acquisition”).

The total consideration for the acquisition consisted of the issuance of approximately 2.4 million shares of KLXE Common Stock, subject to customary post-closing adjustments, with an implied enterprise value of approximately $ 30.3 based on a 30-day volume weighted average price as of March 7, 2023 less acquired cash.

Following the closing of the transaction, former shareholders of Greene’s held approximately 14.7 % of the fully diluted Common Stock of the Company, as of March 8, 2023.

The integration was complete in the third quarter of 2023.

This transaction was accounted for as a purchase under FASB ASC Topic 805, Business Combinations (“ASC 805”).

The results of operations for the acquisition are included in the accompanying consolidated statements of operations from the respective date of acquisition.

Under the ASC 805 acquisition method of accounting, we allocate the fair value of purchase consideration transferred to the tangible assets and intangible assets acquired, if any, and liabilities assumed based on their estimated fair values on the date of the acquisition.

The fair values assigned, defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between willing market participants, are based on assumptions and methodologies determined by management.

Real property was valued using a market approach.

Personal property was valued using a combination of market approach and replacement cost approach.

The estimated fair value of the assets acquired, net of liabilities assumed, exceeds the purchase consideration, resulting in a bargain purchase gain.

This has been presented as a separate line item on the consolidated statements of operations for the year ended December 31, 2024.

The fair values assigned to certain assets acquired and liabilities assumed in relation to the Company’s acquisition have been prepared on a preliminary basis with information currently available and are subject to change.

The Company expects to finalize its analysis by the first quarter of 2024.

The following table summarizes the fair values of assets acquired and liabilities assumed in the acquisition in accordance with ASC 805:

Accounts receivable-trade 17.1

Other current and non-current assets 0.2

Property and equipment 23.1

Accounts payable ( 3.2 )

Accrued liabilities ( 1.2 )

Other current and non-current liabilities ( 1.2 )

Bargain purchase, net of deferred taxes ( 1.9 )

Total purchase price $ 34.0

Unaudited Supplemental Pro Forma Information

The unaudited supplemental pro forma financial information has been provided for illustrative purposes only and does not purport to be indicative of the actual results that would have been achieved by combining the companies for the periods presented, or of the results that may be achieved by the combined companies in the future.

Further, actual results may vary significantly from the results reflected in the following unaudited supplemental pro forma financial information because of future events and transactions, as well as other factors.

The unaudited supplemental pro forma financial information does not include adjustments to reflect the impact of other cost savings or synergies that may result from the acquisition.

On a pro forma basis to give effect to the acquisition, as if it occurred on January 1, 2023, revenues and net income for the years ended December 31, 2024 and December 31, 2023 would have been as follows:

Unaudited Pro Forma

December 31, 2024 December 31, 2023

Revenues $ 709.3 $ 900.7

Net income ( 53.0 ) 19.2

The Company adopted ASU 2023-09 on January 1, 2025 using a fully retrospective method of transition.

Refer to Note 12 - Income Taxes.

NOTE 3 - Inventories, net

35 unchanged sentences

As of December 31, 2025 and December 31, 2024, the Company’s consolidated balance sheet includes assets classified as held for sale of $ — and $ 2.3 , respectively.

As of December 31, 2024, the assets held for sale are reported within prepaid expenses and other current assets on the consolidated balance sheet and represent the value of one facility and select equipment.

These assets are being actively marketed for sale as of December 31, 2024 and are recorded at the lower of their carrying value or fair value less costs to sell.

NOTE 5 - Accrued Liabilities

10 unchanged sentences

2025 Senior Notes $ — $ 236.3

$ 236.3 $ 237.3

2030 Senior Notes 244.1 —

Prior ABL Facility — 50.0

2028 ABL Facility 36.0 —

Total principal outstanding 280.1

Unamortized debt issuance costs ( 6.2 ) ( 1.2 )

Unamortized original issue discount ( 15.6 ) —

Total debt 258.3 285.1

(1) Subsequent to December 31, 2024, the Company completed the Refinancing (as defined below) and entered into the New ABL Facility (as defined below).

In connection therewith, the Company deposited funds in trust to be used to effect the redemption of all the remaining outstanding 2025 Senior Notes and repaid the Prior ABL Facility in full.

As such, these obligations are classified as long-term on the Company's Consolidated Balance Sheets at December 31, 2024.

See below for further information on these transactions.

2025 Senior Notes

As of December 31, 2024, long-term debt included $ 236.3 principal amount of the 2025 Senior Notes offered pursuant to Rule 144A under the Securities Act of 1933 (as amended, the “Securities Act”) and to certain non-U.S.

persons outside the United States in compliance with Regulation S under the Securities Act.

On a net basis, after taking into consideration the debt issuance costs for the 2025 Senior Notes, long-term debt related to the 2025 Senior Notes as of December 31, 2024 was $ 235.1 .

The 2025 Senior Notes bear interest at an annual rate of 11.5 %, payable semi-annually in arrears on May 1 and November 1.

Interest expense related to the 2025 Senior Notes amounted to $ 27.3 and $ 27.3 for the years ended December 31, 2024 and December 31, 2023, respectively.

Accrued interest related to the 2025 Senior Notes as of December 31, 2024 and December 31, 2023 was $ 4.5 and $ 4.5 , respectively.

During the year ended December 31, 2024, we entered into a debt-for-equity exchange agreement (the “Exchange Agreement”) with a noteholder of our 2025 Senior Notes.

Pursuant to the Exchange Agreement, the noteholder exchanged $ 1.0 in aggregate principal amount of the Company’s outstanding 2025 Senior Notes for an aggregate of 190,476 shares of our Common Stock (the “Exchange”).

The Company’s shares of Common Stock issued in connection with the debt-for-equity exchanges were not registered under the Securities Act, and were issued to existing holders of the Company’s securities without commission in reliance on the exemption from registration provided by Section 3(a)(9) of the Securities Act.

The 2025 Senior Notes exchanged in 2024 represent approximately 0.4 % of the outstanding principal amount of outstanding 2025 Senior Notes prior to the Exchange.

Following the Exchange, approximately $ 236.3 in aggregate principal amount of the 2025 Senior Notes remained outstanding.

No 2025 Senior Notes were exchanged in 2023 and there were approximately $ 237.3 in aggregate principal amount of the 2025 Senior Notes outstanding as of December 31, 2023.

On March 12, 2025, approximately $ 143.6 aggregate principal amount of the 2025 Senior Notes were exchanged in connection with the Refinancing, and the Company deposited $ 97.1 in trust with the trustee for the 2025 Senior Notes and irrevocably instructed the trustee to apply such funds to effect the redemption of all of the remaining outstanding 2025 Senior Notes on March 30, 2025 at a redemption price of 100.000 % of the principal amount thereof, plus accrued and unpaid interest.

Upon deposit of such redemption amount, the indenture that governs the 2025 Senior Notes was satisfied and discharged in accordance with its terms and, as a result thereof, the Company has been released from its obligations under the 2025 Senior Notes except with respect to those provisions of the indenture that, by their terms, survive the satisfaction and discharge of thereof.

Current portion of long-term debt 4.4 —

Long-term debt $ 253.9 $ 285.1

On March 7, 2025, the Company and certain of our subsidiaries party thereto entered into a Securities Purchase Agreement with certain holders (the “Investors”) of our 11.5 % senior secured notes due 2025 (the “2025 Senior Notes”), pursuant to which the Company agreed to issue and sell to the Investors (a) approximately $ 232.2 in aggregate principal amount of the Senior Secured Floating Rate Cash / PIK Notes due 2030 (the “2030 Senior Notes” and, together with the 2025 Senior Notes, the “Senior Secured Notes”) and (b) warrants entitling the holders thereof to purchase, in the aggregate, up to 2,373,187 shares of Common Stock, at an exercise price of $ 0.01 per share, subject to adjustment in exchange for (i) approximately $ 78.4 in aggregate cash consideration and (ii) approximately $ 143.6 aggregate principal amount of the 2025 Senior Notes, which were cancelled by the Company upon receipt thereof (collectively, the “Refinancing”).

The Company consummated the Refinancing on March 12, 2025.

Senior Secured Notes

2030 Senior Notes

1 unchanged sentence

Bank Trust Company, National Association, as the trustee and notes collateral agent, pursuant to which $ 232.2 of the 2030 Senior Notes were issued.

The 2030 Senior Notes will mature on March 12, 2030 and bear a floating rate of interest

of Term SOFR plus the Applicable Margin (as defined in the 2030 Senior Notes Indenture) based on the Secured Net Leverage Ratio (as defined in the 2030 Senior Notes Indenture) payable on the last day of the applicable interest period in cash or, at the Company’s election, additional 2030 Senior Notes paid-in-kind on one-, three- or six-month interest periods, which shall include a 100 basis point premium for any period where interest is paid-in-kind.

The 2030 Senior Notes will mature on March 12, 2030 and bear a floating rate of interest of Term SOFR plus the Applicable Margin (as defined in the 2030 Senior Notes Indenture) based on the Secured Net Leverage Ratio (as defined in the 2030 Senior Notes Indenture) payable on the last day of the applicable interest period in cash or, at the Company’s election, additional 2030 Senior Notes paid-in-kind on one-, three- or six-month interest periods, which shall include a 100 basis point premium for any period where interest is paid-in-kind.

The 2030 Senior Notes are senior secured obligations of the Company and are guaranteed on a senior secured basis by each of the Company’s current domestic subsidiaries and by certain future subsidiaries, subject to agreed guaranty and security principles and certain exclusions.

The 2030 Senior Notes were initially fully and unconditionally guaranteed by each of the Company’s current subsidiaries.

The 2030 Senior Notes will also be guaranteed by each of the Company’s future subsidiaries that guarantee the Company’s indebtedness or indebtedness of guarantors, including under the New ABL Facility and such subsidiaries that become guarantors in the future will also pledge their collateral in support of such guarantees.

These guarantees are senior secured obligations of the guarantors secured by a first priority security interest on substantially all of the guarantors’ assets (other than collateral securing the New ABL Facility on a first priority basis) and a second priority security interest on the guarantors’ assets which secure the New ABL Facility on a first priority basis, subject in each case to certain excluded assets.

The Company will be required to redeem the 2030 Senior Notes in an amount equal to 2.00 % per annum of all 2030 Senior Notes outstanding as of the prior applicable Interest Payment Date (as defined in the 2030 Senior Notes Indenture) on the last business day of each of March, June, September and December, commencing on March 31, 2025.

The 2030 Senior Notes are fully and unconditionally guaranteed by each of the Company’s current subsidiaries.

The 2030 Senior Notes will also be guaranteed by each of the Company’s future subsidiaries that guarantee the Company’s indebtedness or indebtedness of guarantors, including under the 2028 ABL Facility and such subsidiaries that become guarantors in the future will also pledge their collateral in support of such guarantees.

These guarantees are senior secured obligations of the guarantors secured by a first priority security interest on substantially all of the guarantors’ assets (other than collateral securing the 2028 ABL Facility on a first priority basis) and a second priority security interest on the guarantors’ assets which secure the 2028 ABL Facility on a first priority basis, subject in each case to certain excluded assets.

The Company is required to redeem the 2030 Senior Notes in an amount equal to 2.00 % per annum of all 2030 Senior Notes outstanding as of the prior applicable Interest Payment Date (as defined in the 2030 Senior Notes Indenture) on the last business day of each of March, June, September and December.

Additionally, upon certain changes of control, consummation of certain asset sales and other events, the Company will be required to repurchase the 2030 Senior Notes at the applicable redemption prices.

The 2030 Senior Notes Indenture contains certain financial covenants that include (i) a maximum total net leverage ratio of not greater than 4.50 to 1.0 for the test periods ending March 31, 2025 through December 31, 2025, stepping down to 4.00 to 1.0 for the test periods ending March 31, 2026 through December 31, 2026, 3.50 to 1.0 for the test periods ending March 31, 2027 through December 31, 2027, 3.00 to 1.0 for the test periods ending March 31, 2028 through December 31, 2028, and 2.50 to 1.0 for each test period thereafter and (ii) restrictions on making net capital expenditures in any test period in excess of the greater of (x) $ 65.0 in the aggregate or (y) 7 % of revenues during such test period.

As of December 31, 2025, the Company was in compliance with its debt covenants under the 2030 Senior Notes.

The 2030 Senior Notes Indenture also restricts, among other things, the Company’s ability to incur indebtedness and liens, pay dividends or make other distributions, make certain other restricted payments or investments, sell assets, enter into restrictive agreements, enter into transactions with the Company’s affiliates, and merge or consolidate with other entities or convey, transfer or lease all or substantially all of the Company’s properties and assets to another person, which, in each case, is subject to certain limitations and exceptions.

1 unchanged sentence

The 2030 Senior Notes Indenture permits the Company to incur additional pari passu indebtedness of up to $ 150.0 within twelve months of the Refinancing (including for the purpose of consummating permitted acquisitions and investments) subject to the terms and conditions contained in the 2030 Senior Notes Indenture and contains certain other covenants, events of default and other customary provisions.

Prior ABL Facility

On August 10, 2018, the Company entered into a Credit Agreement, by and among the Company, as borrower, certain subsidiaries of the Company, as guarantors, JPMorgan Chase Bank, N.A., as administrative agent (“Prior Administrative Agent”), as collateral agent and as issuing lender, and the lenders party thereto, which has been repaid in full and the commitments thereunder terminated (as amended, supplemented, or otherwise modified prior to the date hereof, the “Prior ABL Facility”).

The Prior ABL Facility became effective on September 14, 2018 and was scheduled to mature in 2025.

Borrowings under the Prior ABL Facility bore interest at a rate equal to Term SOFR (as defined in the Prior ABL Facility) plus the Applicable Margin (as defined in the Prior ABL Facility).

As of December 31, 2024, $ 50.0 was outstanding under the Prior ABL Facility and the effective interest rate under the Prior ABL Facility was approximately 7.44 %.

On March 12, 2025, in connection with the completion of the Refinancing, the Prior Credit Facility was repaid in full using borrowings under the New ABL Facility and the commitments thereunder terminated.

In connection with the prepayment and termination of the Prior ABL Facility, the Company provided Prior Administrative Agent cash collateral in support of certain existing letters of credit and existing purchasing card program in an aggregate amount of approximately $ 8.1 .

New ABL Facility

On March 7, 2025, the Company also entered into a Credit Agreement, dated as of March 7, 2025 (the “New ABL Facility”), with the Company, as borrower, Eclipse Business Capital LLC, as administrative agent, as collateral agent and as FILO administrative agent and the lenders party thereto.

The New ABL Facility is comprised of an asset-based revolving credit facility with a $ 125.0 commitment (the “Revolving Facility”), a first-in-last-out asset-based credit facility with a $ 10.0 commitment (the “FILO Facility”), and a committed incremental loan option under the Revolving Facility with a $ 25.0 commitment (the “Incremental Revolving Loans”).

As of December 31, 2025, the principal amount outstanding under the 2030 Senior Notes was $ 244.1 .

On a net basis, after taking into consideration unamortized debt issuance costs and original issue discount for the 2030 Senior Notes, total debt related to the 2030 Senior Notes as of December 31, 2025 was $ 222.3 .

The effective interest rate under the 2030 Senior Notes was approximately 12.3 % on December 31, 2025.

Accrued interest related to the 2030 Senior Notes was $ — as of December 31, 2025.

2025 Senior Notes

The previously-issued 2025 Senior Notes were redeemed on March 30, 2025 and the related indenture was satisfied and discharged.

On a net basis, after taking into consideration the debt issuance costs for the 2025 Senior Notes, total debt related to the 2025 Senior Notes as of December 31, 2024 was $ 235.1 .

The 2025 Senior Notes bore interest at an annual rate of 11.5 %, payable semi-annually in arrears on May 1 and November 1.

Accrued interest as of December 31, 2024 was $ 4.5 .

ABL Facilities

2028 ABL Facility

On March 7, 2025, the Company also entered into a Credit Agreement, dated as of March 7, 2025 (the “2028 ABL Facility”), with the Company, as borrower, Eclipse Business Capital LLC, as administrative agent, as collateral agent and as FILO administrative agent and the lenders party thereto.

The 2028 ABL Facility is comprised of an asset-based revolving credit facility with a $ 125.0 commitment (the “Revolving Facility”), a first-in-last-out asset-based credit facility with a $ 10.0 commitment (the “FILO Facility”), and a committed incremental loan option under the Revolving Facility with a $ 25.0 commitment (the “Incremental Revolving Loans”).

The availability of the Incremental Revolving Loans are subject to usual and customary conditions to effectiveness, including, for example, the Company electing to utilize such Incremental Revolving Loans by a date certain and the payment of required fees.

2 unchanged sentences

The applicable margin under the Revolving Facility is subject to a 0.125 % reduction and the applicable margin under the FILO Facility is subject to a 0.50 % reduction, in each case upon the repayment in full of a $ 5.0 over-advance provided on the initial funding date under the Revolving Facility.

The New ABL Facility is secured by, among other things, a first priority lien on accounts receivable and inventory and contains customary conditions precedent to borrowing and affirmative and negative covenants.

The initial funding under the New ABL Facility occurred on March 12, 2025, and the proceeds therefrom were used to repay the Prior ABL Facility in full.

After giving effect to the foregoing, we had approximately $ 39.9 of available borrowing capacity under the New ABL Facility.

The New ABL Facility includes a springing financial covenant which requires the Company’s consolidated fixed charge coverage ratio to be at least 1.0 to 1.0 if availability under the Revolving Facility falls below $ 7.0 .

The New ABL Facility includes financial, operating and negative covenants that limit our ability to incur indebtedness, to create liens or other encumbrances, to make certain payments and investments, including dividend payments, to engage in transactions with affiliates, to engage in sale/leaseback transactions, to guarantee indebtedness and to sell or otherwise dispose of assets and merge or consolidate with other entities.

The 2028 ABL Facility is secured by, among other things, a first priority lien on accounts receivable and inventory and contains customary conditions precedent to borrowing and affirmative and negative covenants.

The initial funding under the 2028 ABL Facility occurred on March 12, 2025, and the proceeds therefrom were used to repay the Prior ABL Facility in full.

After giving effect to the foregoing, we had approximately $ 39.9 of available borrowing capacity under the 2028 ABL Facility.

Our 2028 ABL Facility matures on March 7, 2028.

The 2028 ABL Facility includes a springing financial covenant which requires the Company’s consolidated fixed charge coverage ratio to be at least 1.0 to 1.0 if availability under the Revolving Facility falls below $ 7.0 .

The 2028 ABL Facility includes financial, operating and negative covenants that limit our ability to incur indebtedness, to create liens or other encumbrances, to make certain payments and investments, including dividend payments, to engage in transactions with affiliates, to engage in sale/leaseback transactions, to guarantee indebtedness and to sell or otherwise dispose of assets and merge or consolidate with other entities.

It also includes a covenant to deliver annual audited financial statements that are not qualified by a “going concern” or like qualification or exception.

A failure to comply with the obligations contained in the New ABL Facility could result in an event of default, which could permit acceleration of the debt, termination of undrawn commitments and enforcement against any liens securing the debt.

The New ABL Facility contains certain other covenants (including the ability to incur indebtedness for the purpose of consummating permitted acquisitions, subject to the terms of the New ABL Facility), events of default and other customary provisions.

Our New ABL Facility matures in 2028.

A failure to comply with the obligations contained in the 2028 ABL Facility could result in an event of default, which could permit acceleration of the debt, termination of undrawn commitments and enforcement against any liens securing the debt.

The 2028 ABL Facility contains certain other covenants (including the ability to incur indebtedness for the purpose of consummating permitted acquisitions, subject to the terms of the 2028 ABL Facility), events of default and other customary provisions.

As of December 31, 2025, the Company was in compliance with its debt covenants under the 2028 ABL Facility.

As of December 31, 2025, the borrowings outstanding under the 2028 ABL Facility were $ 36.0 .

The effective interest rate under the 2028 ABL Facility was approximately 8.61 % on December 31, 2025.

Accrued interest related to the 2028 ABL Facility was $ 0.4 as of December 31, 2025.

We have funds available under the 2028 ABL Facility of $ 50.6 on the December 2025 borrowing base certificate, which includes the undrawn availability on the FILO Facility.

Prior ABL Facility

On March 12, 2025, in connection with the completion of the Refinancing, the Prior ABL Facility was repaid in full using borrowings under the 2028 ABL Facility and the commitments thereunder terminated.

As of December 31, 2024, $ 50.0 was outstanding under the Prior ABL Facility and the effective interest rate under the Prior ABL Facility was approximately 7.44 %.

Other debt-related items

The Company uses standby letters of credit to facilitate commercial transactions with third parties and to secure our performance to certain vendors.

Total letters of credit outstanding under the Prior ABL Facility were $ 6.5 at December 31, 2024.

Total letters of credit outstanding under the 2028 ABL Facility were $ 6.9 at December 31, 2025.

To the extent liabilities are incurred as a result of the activities covered by the letters of credit, such liabilities are included on the accompanying consolidated balance sheets.

As of December 31, 2024, the Company had $ 1.9 of outstanding short-term indebtedness related to the financing of various insurance premiums.

As of December 31, 2025, the Company had $ 1.9 of outstanding short-term indebtedness related to the financing of various insurance premiums at a weighted average interest rate of approximately 6.77 %.

NOTE 7 - Leases

52 unchanged sentences

2026 $ 9.4 $ 22.8

2026 7.0 16.5

Thereafter 5.4 —

2 unchanged sentences

Total $ 23.0 $ 37.0

As of December 29, 2023, the Company has entered into an agreement to modify the leases for its five coiled tubing units.

As a result, these are now classified as finance leases on the balance sheet as of December 31, 2023.

The lease cost up to December 29, 2023, is included in the operating lease cost disclosure in this footnote, and the lease cash flows up to December 29, 2023, are included in the operating cash flows for operating leases disclosure in this footnote.

NOTE 8 - Fair Value Information

6 unchanged sentences

The carrying amounts of cash and cash equivalents, accounts receivable-trade and accounts payable represent their respective fair values due to their short-term nature.

There was $ 50.0 debt outstanding under the Prior ABL Facility as of December 31, 2024.

The fair value of the Prior ABL Facility approximates its carrying value as of December 31, 2024.

There was $ 36.0 debt outstanding under the 2028 ABL Facility as of December 31, 2025 and $ 50.0 debt outstanding under the Prior ABL Facility as of December 31, 2024.

The fair value of each the 2028 ABL Facility and the Prior ABL Facility approximates each of their respective carrying values as of year-end.

The following tables present the placement in the fair value hierarchy of the 2025 Senior Notes, based on market prices for publicly traded debt, as of December 31, 2025 and December 31, 2024:

16 unchanged sentences

Total Assets Held for Sale $ 2.3 $ — $ 2.3 $ —

During the years ended December 31, 2024 and December 31, 2023, there was no before-tax loss (gain) related to Assets Held for Sale.

During the years ended December 31, 2025 and December 31, 2024, there was $ 0.2 and no before-tax loss related to Assets Held for Sale, respectively.

NOTE 9 - Commitments, Contingencies and Off-Balance Sheet Arrangements

6 unchanged sentences

The amount of such future expenditures is not determinable due to several factors, including the unknown magnitude of possible regulation or liabilities, the unknown timing and extent of the corrective actions that may be required, the determination of the Company’s liability in proportion to other responsible parties and the extent to which such expenditures are recoverable from insurance or indemnification.

The Company is at times either a plaintiff or a defendant in various legal actions arising in the normal course of business, the outcomes of which, in the opinion of management, neither individually nor in the aggregate are likely to result in a material adverse effect on the Company’s consolidated financial statements, except as noted herein.

Indemnities, Commitments and Guarantees

20 unchanged sentences

On November 16, 2022, the Company entered into Amendment No.

1 to the Equity Distribution Agreement (the “EDA Amendment”).

Among other things, the EDA Amendment allows for debt for equity exchanges in accordance with Section 3(a)(9) of the Securities Act.

Shares of Common Stock offered and sold in the ATM Offering were issued pursuant to the Company's shelf registration statement on Form S-3 (Registration No.

333-256149) filed with the SEC on May 14, 2021 and declared effective on June 11, 2021 (the “Registration Statement”), the prospectus supplement relating to the ATM Offering filed with the SEC on June 14, 2021 and any applicable additional prospectus supplements related to the ATM Offering that form a part of the Registration Statement.

The Registration Statement expired on June 11, 2024 pursuant to Rule 415(a)(5) under the Securities Act.

Sales under the ATM Offering program may restart when and if the Company files a prospectus supplement under a successor registration statement.

1 to the Equity Distribution Agreement, which, among other things, allows for debt-for-equity exchanges in accordance with Section 3(a)(9) of the Securities Act.

On March 14, 2025, the Company entered into Amendment No.

2 to the Equity Distribution Agreement (the “EDA Amendment”), which, among other things, increased the aggregate offering price to up to approximately $ 57.8 (which amount includes all of the Common Stock previously sold pursuant to the Equity Distribution Agreement prior to the EDA Amendment) and provides for the Company’s election not to deliver a placement notice.

Any Common Stock offered and sold in the ATM Offering may be issued pursuant to the Company’s shelf registration statement on Form S-3 (Registration No.

333-271182) filed with the SEC on April 7, 2023 and declared effective on April 19, 2023 (the “Registration Statement”), the prospectus supplement relating to the ATM Offering filed with the SEC on March 14, 2025 and any applicable additional prospectus supplements related to the ATM Offering that form a part of the Registration Statement.

Sales of Common Stock under the Equity Distribution Agreement, as amended to date, may be made in any transactions that are deemed to be “at the market offerings” as defined in Rule 415 under the Securities Act.

As of the filing of this Annual Report, the Company is subject to the General Instruction I.B.6 to Form S-3, known as the “baby shelf” rule, which limits the amount of securities we can sell under the Registration Statement in any 12-month period.

The Equity Distribution Agreement contains customary representations, warranties and agreements by the Company, indemnification obligations of the Company and the Agent, including for liabilities under the Securities Act, other obligations of the parties and termination provisions.

Under the terms of the Equity Distribution Agreement, the Company will pay the Agent a commission equal to 3.0 % of the gross sales price of the Common Stock sold.

The Company used the net proceeds from the ATM Offering, after deducting the Agent’s commissions and the Company’s offering expenses, for general corporate purposes, which included funding acquisitions, capital expenditures and working capital.

During the three and twelve months ended December 31, 2024, the Company did not sell any shares of Common Stock and incurred legal and administrative fees of $ 0.3 and $ 0.5 , respectively.

The Company has used and plans to use the net proceeds from the ATM Offering, after deducting the Agent’s commissions and the Company’s offering expenses, for general corporate purposes, which may include, among other things, paying or refinancing all or a portion of the Company's then-outstanding indebtedness and funding acquisitions, capital expenditures and working capital.

During the three and twelve months ended December 31, 2025, the Company sold — and 167,769 shares of Common Stock, respectively, in exchange for gross proceeds of $ — and $ 0.6 , respectively, and incurred legal and administrative fees of $ — and $ 0.3 , respectively.

During the three and twelve months ended December 31, 2024, the Company did not sell any shares of Common Stock and incurred legal and administrative fees of $ 0.3 and $ 0.5 , respectively.

The Company has a Long-Term Incentive Plan (“LTIP”) under which the Compensation Committee has the authority to grant stock options, stock appreciation rights, restricted stock, restricted stock units or other forms of equity-based or equity-related awards.

Compensation cost for the LTIP grants is generally recorded on a straight-line basis over the vesting term of the shares based on the grant date value using the closing trading price.

Compensation cost for the LTIP grants is generally recorded on a

straight-line basis over the vesting term of the shares based on the grant date value using the closing trading price.

An amendment to the LTIP was approved by stockholders on May 10, 2023 to, among other things, increase the total number of shares of Common Stock for issuance by 1,200,000 shares, resulting in an increase of the total number of shares of our Common Stock reserved for issuance to 1,256,289 , and extend the expiration date to March 8, 2033.

18 unchanged sentences

NOTE 12 - Income Taxes

The Company is subject to taxation only in the United States and various U.S.

December 31, 2025 December 31, 2024

Net loss before income tax $ ( 76.3 ) $ ( 52.4 )

Income tax expense consisted of the following:

4 unchanged sentences

Federal $ — $ —

Total deferred income tax expense (benefit) — ( 0.6 )

Total deferred income tax expense 0.3 —

Total income tax expense $ 0.8 $ 0.6

1 unchanged sentence

December 31, 2025 December 31, 2024

Amount Percent Amount Percent

Income tax (benefit) expense at statutory rate $ ( 16.0 ) 21.0 % $ ( 11.0 ) 21.0 %

State income taxes, net of federal tax benefit (1)

0.6 ( 0.8 ) % 0.7 ( 1.3 ) %

Valuation allowance 14.2 ( 18.6 ) % 9.5 ( 18.1 ) %

Adjustments to prior year tax accruals ( 0.3 ) 2.2

Nontaxable or nondeductible items

Stock based compensation 0.5 ( 0.7 ) % 0.1 ( 0.2 ) %

Non-deductible meals and entertainment 1.3 1.4

Meals and entertainment 1.1 ( 1.4 ) % 1.3 ( 2.5 ) %

Officer compensation 0.3 ( 0.4 ) % 0.3 ( 0.6 ) %

Bargain purchase gain — ( 0.5 )

Total income tax expense $ 0.6 $ 3.0

Other 0.1 ( 0.1 ) % — — %

Adjustments to prior year tax accruals — — % ( 0.3 ) 0.6 %

Total income tax expense and effective tax rate $ 0.8 ( 1.0 ) % $ 0.6 ( 1.1 ) %

(1) State taxes in Texas made up the majority (greater than 50%) of the tax effect in this category.

Income tax expense was $ 0.8 for the year ended December 31, 2025, which reflects an effective tax rate of approximately ( 1.0 )%.

For the fiscal year ended December 31, 2024, the Company recognized current state tax expense on its year-to-date income of $ 0.9 , primarily related to Texas franchise tax, less a federal tax adjustment of $( 0.3 ) to the prior year accrual.

For the fiscal year ended December 31, 2023, the Company recognized current federal tax expense on its year-to-date income of $ 0.3 and $ 1.1 of state income tax, primarily related to Texas franchise tax, less a deferred tax benefit of $( 0.6 ), primarily due to the bargain purchase gain related to the Greene's Acquisition.

In addition, the Company recognized $ 2.0 of federal tax expense and $ 0.2 of state income tax expense for the fiscal year ended December 31, 2022.

For the fiscal year ended December 31, 2025, the Company recognized current state tax expense of $ 0.5 on its year-to-date income, plus deferred state tax expense of $ 0.3 , primarily related to Texas franchise tax.

For the fiscal year ended December 31, 2024, the Company recognized current state tax expense of $ 0.9 on its year-to-date income, primarily related to Texas franchise tax, less a federal tax adjustment of ($ 0.3 ) to the prior year accrual, which reflects an effective tax rate of approximately ( 1.1 )%.

The tax effects of temporary differences and carryforwards that give rise to deferred income tax assets and liabilities consisted of the following:

13 unchanged sentences

Valuation allowance ( 280.3 ) ( 265.2 )

Net deferred tax asset $ 0.1 $ 0.1

Net deferred tax asset (liability) $ ( 0.2 ) $ 0.1

The Company assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets.

2 unchanged sentences

On the basis of this evaluation, as of December 31, 2025 and December 31, 2024, a valuation allowance of $ 280.3 and $ 265.2 has been recorded, respectively, to recognize only the portion of the deferred tax assets that are more likely than not to be realized.

The amount of the deferred tax assets considered realizable, however, could be adjusted if additional objectively verifiable positive evidence materializes in future reporting periods, such as a demonstrated operating profitability.

The change in the valuation allowance from December 31, 2023 was a net increase of $ 11.1 , which is primarily due to the current year operating loss plus prior year adjustments.

The valuation allowance recorded is exclusive of the $ 0.1 relating to the Texas franchise tax, which the Company expects to fully realize.

The amount of the deferred tax assets considered realizable,

however, could be adjusted if additional objectively verifiable positive evidence materializes in future reporting periods, such as a demonstrated operating profitability.

The change in the valuation allowance from December 31, 2024 was a net increase of $ 15.1 , which is primarily due to the current year operating loss.

The valuation allowance recorded is exclusive of the deferred tax liability $ 0.2 relating to the Texas franchise tax.

Internal Revenue Code (“IRC”) Section 382 provides an annual limitation with respect to the ability of a corporation to utilize its net operating loss and other tax attributes, as well as certain built-in-losses, against future U.S.

16 unchanged sentences

Tax years that remain subject to examinations by major tax jurisdictions are generally open for tax years beginning in 2021 and after.

Income taxes paid, net of refunds received, consisted of the following:

December 31, 2025 December 31, 2024

Federal $ — $ 2.2

Texas 0.8 1.0

Colorado 0.1 —

Other 0.1 0.1

Total State 1.0 1.1

Total income taxes paid, net $ 1.0 $ 3.3

NOTE 13 - Segment Reporting

1 unchanged sentence

The Company’s reportable segments, which are also its operating segments, are comprised of the Southwest Region (the Permian Basin and the Eagle Ford Shale), the Rocky Mountains Region (the Bakken, Williston, DJ, Uinta, Powder River, Piceance and Niobrara basins) and the Northeast/Mid-Con Region (the Marcellus and Utica Shale as well as the Mid-Continent STACK and SCOOP and Haynesville Shale).

The segments regularly report their results of operations and make requests for capital expenditures and acquisition funding to the Chief Operating Decision Maker ("CODM").

The Company's CODM is our Chief Executive Officer.

As a result, Company has three reportable segments.

The Company has adopted ASU 2023-07, Segment Reporting (Topic 280) as of December 31, 2024.

Accordingly, the following tables have been updated to present revenues, significant expenses and operating income by reportable segment:

The Company’s segments report operating results and capital or acquisition funding requests to the Chief Operating Decision Maker (“CODM”), the Chief Executive Officer.

The CODM evaluates each segment’s performance based on segment operating income (loss) relative to budget and historical results.

These evaluations are used to allocate resources and determine capital expenditures and management compensation for each segment.

Accordingly, the Company has three reportable segments.

The following tables present revenues, significant expenses and operating income (loss) by reportable segment:

December 31, 2025

6 unchanged sentences

Other segment items 6.3 2.4 5.1

Segment operating income $ 23.6 $ 4.0 $ 2.2 $ — $ 29.8

Segment operating income (loss) $ 5.7 $ ( 3.5 ) $ 3.6 $ — $ 5.8

Reconciliation of profit or loss (segment profit/(loss))

2 unchanged sentences

Interest expense ( 45.2 )

Loss on debt extinguishment ( 1.2 )

Loss before income tax $ ( 76.3 )

(1) Note that the Selling, general and administrative line item in the Consolidated Statement of Operations contains the Other segment items line item here, less the Research and development costs line item.

(2) For the twelve months ended December 31, 2025, these consist of $ 3.2 of cost of sales, $ 2.3 of depreciation and amortization, $ 28.9 of selling, general and administrative, and $ 1.7 of other segment items.

December 31, 2024

11 unchanged sentences

Interest expense ( 39.4 )

Income before income tax $ 22.2

Loss before income tax $ ( 52.4 )

(2) For the twelve months ended December 31, 2024, these consist of $ 4.0 of cost of sales, $ 1.8 of depreciation and amortization, $ 38.0 of selling, general and administrative, and $ 1.5 of other segment items.

Other segment items include research and development costs, allocations and other expenses.

29 unchanged sentences

Northeast/Mid-Con 23.1 26.1

Unallocated corporate expenditures 0.4 0.9

Unallocated corporate capital expenditures 0.6 0.4

Total capital expenditures $ 49.1 $ 65.1

NOTE 15 - Net (Loss) Income Per Common Share

Basic net (loss) income per common share is computed using the weighted average common shares outstanding during the period.

Diluted net (loss) income per common share is computed by using the weighted average common shares outstanding, excluding unvested restricted shares when their inclusion would be anti-dilutive.

NOTE 14 - Net Loss Per Common Share

Basic net loss per common share is computed using the weighted average common shares outstanding during the period.

Diluted net loss per common share is computed by using the weighted average common shares outstanding, excluding unvested restricted shares when their inclusion would be anti-dilutive.

For the years ended December 31, 2025 and December 31, 2024, we excluded 0.7 and 0.4 million shares of the Company’s Common Stock, respectively.

1 unchanged sentence

December 31, 2025 December 31, 2024

Net (loss) income $ ( 53.0 ) $ 19.2

Net loss $ ( 77.1 ) $ ( 53.0 )

(Shares in millions)

2 unchanged sentences

Diluted weighted average common shares 18.7 16.2

Basic net (loss) income per common share $ ( 3.27 ) $ 1.23

Diluted net (loss) income per common share $ ( 3.27 ) $ 1.22

Basic net loss per common share $ ( 4.12 ) $ ( 3.27 )

Diluted net loss per common share $ ( 4.12 ) $ ( 3.27 )

NOTE 15 - Related Party Transactions

Stuart Porter, a greater than 5% passive shareholder of the company, is the Senior Partner of Trace Capital.

From time to time and in the ordinary course of business and at arms-length, certain Trace Capital portfolio companies engage us as service providers.

The revenue associated with these related party transactions was $ 11.6 for the year ended December 31, 2025 and the related accounts receivable balance was $ 3.9 as of December 31, 2025.

NOTE 16 - Subsequent Events

On March 7, 2025, the Company and certain of its subsidiaries party thereto entered into a Securities Purchase Agreement with certain holders (the “Investors”) of its 2025 Senior Notes, pursuant to which the Company agreed to issue and sell to the Investors (a) approximately $ 232.2 in aggregate principal amount of 2030 Senior Notes and (b) warrants entitling the holders thereof to purchase, in the aggregate, up to 2,373,187 shares of Common Stock, at an exercise price of $ 0.01 per share, subject to adjustment (collectively, the “Warrants”) in exchange for (i) approximately $ 78.4 in aggregate cash consideration and (ii) approximately $ 143.6 aggregate principal amount of the 2025 Senior Notes, which will be cancelled by the Company upon receipt thereof (collectively, the “Refinancing”).

The Company completed the Refinancing on March 12, 2025, and in connection therewith, deposited with the trustee under the indenture governing the 2025 Senior Notes, $ 97.1 in trust and irrevocably instructed the trustee to apply such funds to effect the redemption of the remaining 2025 Senior Notes.

Upon deposit of such redemption amount, the indenture governing the 2025 Senior Notes was satisfied and discharged in accordance with its terms and, as a result, the Company has been released from its obligations under the indenture governing the 2025 Senior Notes except with respect to those provisions of such indenture that, by their terms, survive the satisfaction and discharge thereof.

In connection with the Refinancing, the Company also entered into a Credit Agreement, dated as of March 7, 2025 (the “New ABL Facility”), with the Company, as borrower, Eclipse Business Capital LLC, as administrative agent, as collateral agent and as FILO administrative agent and the lenders party thereto.

The initial funding under the New ABL Facility occurred on March 12, 2025, and the proceeds therefrom were used to repay the Prior ABL Facility in full.

Please see Note 7 - Long Term Debt for additional information regarding the redemption of the 2025 Senior Notes, the 2030 Senior Notes, the repayment of the Prior ABL Facility and the New ABL Facility.

Subsequent events have been evaluated through the date of issuance of these financial statements, and there have been no events subsequent to December 31, 2025, other than those items disclosed below, that would require additional adjustments to our disclosure in our financial statements during the period.

On March 6, 2026, the requisite holders agreed to execute the First Amendment to the 2030 Senior Notes Indenture (the “First Amendment to the Indenture”) to provide financial covenant relief in the form of (i) extending the period for which the maximum total net leverage ratio covenant is tested at 4.50 to 1.0 through and including the testing period ending March 31, 2027, stepping down to 3.50 to 1.0 for the testing periods ending June 30, 2027 through and including March 31, 2028, to 3.00 to 1.0 for the testing periods ending June 30, 2028 through and including March 31, 2029, and to 2.50 to 1.0 for the testing periods ending June 30, 2029 and thereafter, (ii) a temporary holiday to exclude capital lease obligations as indebtedness for the purposes of determining compliance with the maximum total net leverage ratio covenant for the testing periods ending December 31, 2025 through and including March 31, 2027 and (iii) clarifying that proceeds from our ATM Offering program may be applied as an equity cure.

The First Amendment to the Indenture also establishes additional debt and lien baskets to permit the issuance of letters of credit by third parties for the Company’s account in favor of insurers in connection with a $ 6.7 substitute insurance collateral facility.

There is no certainty that, following the First Amendment to the Indenture, we will continue being able to comply with our covenants or that we will be able to obtain future amendments in the event we are unable to comply with our covenants.

In connection with our entry into the First Amendment to the Indenture, on March 6, 2026, we issued Warrants to our noteholders, based on their pro rata ownership of principal amount of the 2030 Senior Notes, providing for the purchase of up to 803,712 shares of Common Stock at an exercise price of $ 0.01 per share, subject to adjustment, pursuant to Section 4(a)(2) of the Securities Act.

Under the warrant agreements governing the Warrants, the Company undertakes to file a registration statement with SEC with respect to the shares of Common Stock underlying the Warrants within 90 days of their issuance, providing for registered resale pursuant thereto.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data