What changed in this filing

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Item 1A. Risk Factors

2026-03-12 compared with 2025-03-19 · 43 added, 44 removed, 204 unchanged (30% of the section changed)

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Risks Related to Financing Our Business

We are subject to risks associated with indebtedness under our credit facilities, including the risk of failure to maintain compliance with financial covenants, the risk of being unable to make interest and principal payments when due and the risk of rising interest rates.

We are subject to risks associated with indebtedness under our credit facilities and the Series B Preferred Stock, including the risk of failure to maintain compliance with financial and other covenants, the risk of being unable to make interest and principal payments when due and the risk of rising interest rates under our credit facilities.

Additionally, our significant debt and high leverage could have a negative impact on our financing options and liquidity position.

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• limit our ability to refinance our existing debt on terms acceptable to us, or at all;

• require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments on our debt, thereby limiting the availability of our cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements;

• require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments, thereby limiting the availability of our cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements;

• create a competitive disadvantage by reducing our flexibility in responding to increased competition from competitors who hold a lower level on indebtedness.

Our ability to meet expenses and debt service obligations will depend on our future performance, which will be affected by financial, business, economic and other factors.

If we do not generate enough cash to pay our debt service obligations, we may be required to refinance all or part of our debt, sell assets, borrow more money or raise additional equity capital.

Disclosure of our debt instruments appears under Note 11 – Debt of the consolidated financial statements.

Our ability to maintain compliance with the financial covenants pursuant to the debt instruments we are party to is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties.

Our ability to meet expenses and debt service obligations and obligations relating to the Series B Preferred Stock will depend on our future performance, which will be affected by financial, business, economic and other factors.

If we do not generate enough cash to pay our debt service obligations and obligations relating to the Series B Preferred Stock, we may be required to refinance our capital structure, sell assets, borrow more money or raise additional equity capital.

Disclosure of our debt instruments appears under Note 11 – Debt of the consolidated financial statements, and disclosure of our Series B Preferred Stock appears under Note 16 – Redeemable Preferred Stock of the consolidated financial statements.

Our ability to maintain compliance with the covenants pursuant to the debt instruments we are party to and the Series B Certificate of Designation is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties.

Additionally, these risks and uncertainties may, among other factors, impact our ability to generate cash flows from operations, access the capital markets on acceptable terms or at all, and affect our future need or ability to borrow under our credit agreements.

In addition to our current sources of funding our business, the effects of such events may impact our liquidity or our need to revise our allocation or sources of capital, implement further cost reduction measures and/or change our business strategy.

We rely primarily on cash flows from our operations to make required interest and principal payments on our debt.

If we are unable to generate sufficient cash flows from our operations, we may be unable to pay interest and principal obligations on our debt when they become due.

Failure to comply with these obligations or failure to comply with the financial covenants discussed above could result in an event of default, which would permit our lenders to accelerate the repayment of the debt.

We rely primarily on cash flows from our operations to make required interest and principal payments.

If we are unable to generate sufficient cash flows from our operations, we may be unable to pay interest and principal obligations when they become due.

Failure to comply with these obligations or failure to comply with the covenants discussed above could result in an event of default, which would permit our lenders under our credit facilities to accelerate the repayment of the debt.

If our lenders accelerate the repayment of debt, there is no assurance that we could refinance such debt on terms favorable to us or at all.

Our largest shareholder (Corre and certain of its affiliates) owns a meaningful percentage of our outstanding equity securities, which could limit the ability of other shareholders to influence corporate matters .

As of March 17, 2025, Corre and certain of its affiliates beneficially owned approximately 41.2% of the total voting power held by shareholders of our outstanding common stock (including common stock issued pursuant to the common stock subscription agreement with certain Corre holders and shares issuable upon exercise, subject to beneficial ownership limitation, of certain Warrants, as defined below, held by our largest shareholder in each case).

As of March 10, 2026, Corre and certain of its affiliates beneficially owned approximately 41.5% of the total voting power held by shareholders of our outstanding common stock (including common stock issued pursuant to the common stock subscription agreement with certain Corre holders and shares issuable upon exercise, subject to beneficial ownership limitation, of certain warrants, as described below, held by our largest shareholder in each case).

As a result, this shareholder may be able to exert influence over our management, business plans and policies, as well as matters submitted to our stockholders for approval, such as the selection of directors and amendments of our organizational documents.

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Our share of the market for our services is characterized by continual technological developments to provide better and more cost-effective services.

If we are not able to implement commercially competitive services and products in a timely manner in response to

changes in the market, customer requirements, competitive pressures, inflationary pressures and technology trends, our business and results of operations could be materially and adversely affected.

If we are not able to implement commercially competitive services and products in a timely manner in response to changes in the market, customer requirements, competitive pressures, inflationary pressures and technology trends, our business and results of operations could be materially and adversely affected.

Likewise, if our proprietary technologies, equipment, facilities, or work processes become obsolete, we may no longer be competitive, and our business and results of operations could be materially and adversely affected.

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Improvements in operating results from expected savings in operating costs from workforce reductions and other cost saving and business improvement initiatives may not be realized, may take longer to be realized, or could be realized only for a limited perio d.

Since January 2021, we have implemented a new strategic organizational structure and reduced our operating costs through headcount reductions and other steps to better position ourselves to deliver improved margins and cash flow from operations and to continue service diversification and enhance customer value.

These organizational changes resulted in restructuring charges and other cost-saving opportunities.

However, to implement this or any other future cost savings or

business improvement initiatives, we expect to incur additional expenses, which could adversely impact our financial results prior to the realization of the expected benefits associated with the initiatives.

We continually seek to reduce our operating costs through a more efficient organizational structure, headcount reductions and other steps to better position ourselves to deliver improved margins and cash flow from operations.

However, to implement any future cost savings or business improvement initiatives, we expect to incur additional expenses, which could adversely impact our financial results prior to the realization of the expected benefits associated with the initiatives.

Due to numerous factors or future developments, we may not achieve cost reductions or other business improvements consistent with our expectations or the benefits may be delayed.

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In addition, acquisitions may result in the incurrence of additional debt of the acquired businesses, or we may incur additional debt to finance such acquisitions.

The price of our outstanding securities may be volatile.

It is possible that in some future quarter (or quarters) our revenues, operating results or other measures of financial performance will not meet the expectations of investors, which could cause the price of our outstanding securities to decline or be volatile.

Historically, our quarterly and annual sales and operating results have fluctuated.

We expect fluctuations to continue in the future.

In addition to general economic and political conditions, and in addition to the other factors identified under this Item 1A “Risk Factors”, the following factors may affect our sales and operating results:

the timing of significant customer orders, the timing of planned maintenance projects at customer facilities, changes in competitive pricing, wide variations in profitability by product line, variations in operating expenses, rapid increases in raw material and labor costs, the timing of announcements or introductions of new products or services by us, our competitors or our respective customers, the acceptance of those services, our ability to adequately meet staffing requirements with qualified personnel, relative variations in manufacturing efficiencies and costs, and the relative strength or weakness of international markets.

Since our quarterly and annual revenues and operating results vary, we believe that period-to-period comparisons are not necessarily meaningful and should not be relied upon as indicators of our future performance.

Our business may be adversely impacted by work stoppages, staffing shortages and other labor matters.

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We extend credit to customers for purchases of our services which subjects us to potential credit risk that could, if realized, adversely affect our financial condition, results of operations and cash flows .

If we are unable to collect amounts owed to us, or retain amounts paid to us, our cash flows would be reduced and we could experience losses.

If we are unable to collect amounts

owed to us, or retain amounts paid to us, our cash flows would be reduced and we could experience losses.

We would also recognize losses with respect to any receivables that are impaired as a result of our customers’ financial difficulties or bankruptcies.

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Our profitability for these contracts depends heavily on our ability to make accurate estimates.

Inaccurate estimates, or changes in other circumstances, such as unanticipated technical problems, difficulties obtaining permits or approvals, changes in local laws or labor conditions, weather delays, cost of raw materials, trade disputes and tariffs, currency fluctuations, inflation pressures or our suppliers’ or subcontractors’ inability to perform could result in substantial losses, as such changes adversely affect the revenues and profitability recognized on each project.

Inaccurate estimates, or changes in other circumstances, such as unanticipated technical problems, difficulties obtaining permits or approvals, changes in local laws or labor conditions, changes in trade policies, weather delays, cost of raw materials, trade disputes and tariffs, currency fluctuations, inflation pressures or our suppliers’ or subcontractors’ inability to perform could result in substantial losses, as such changes adversely affect the revenues and profitability recognized on each project.

Current and future inflationary volatility driven by, among other things, supply chain disruptions and governmental stimulus or fiscal policies as well as geopolitical conflicts such as the ongoing military conflict between Russia and Ukraine and in the Middle East, and other geopolitical issues impacting global trade could further impact our ability to make accurate estimates, which could have an adverse impact on our business, cash flows and profitability.

Increasing scrutiny and changing expectations from investors, customers and other market participants with respect to sustainability or environmental, social and governance (“ESG”) matters may impose additional costs on us or expose us to reputational or other risks .

Companies across all industries and around the globe are facing increasing scrutiny relating to their ESG policies, initiatives and activities by investors, lenders, regulators, customers and other market participants.

While we have policies and initiatives in place related to our ESG practices, the recent increased focus on ESG matters may impact our access to capital, as investors and lenders may reconsider their capital investment allocation as a result of their assessment of our ESG practices.

Increased scrutiny and changing expectations from investors, customers and other market participants with respect to sustainability or environmental, social and governance (“ESG”) matters may impose additional costs on us or expose us to reputational or other risks .

Companies across all industries and around the globe are facing increased scrutiny relating to their ESG policies, initiatives and activities by investors, lenders, regulators, customers and other market participants.

While we have policies and initiatives in place related to our ESG practices, the increased focus on ESG matters may impact our access to capital, as investors and lenders may reconsider their capital investment allocation as a result of their assessment of our ESG practices.

Our ESG initiatives, intentions and expectations are subject to change and there can be no assurance that our ESG policies and procedures will continue.

Further, regulatory requirements related to ESG continue to evolve and may increase our costs of compliance.

If we do not adapt to or comply with investor or other stakeholder expectations and standards on ESG matters as they continue to evolve or if we are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a regulatory or legal requirement to do so, we may be exposed to the risk of investigation, inquiry, or legal challenges or suffer reputational damage.

If we do not adapt to or comply with investor or other stakeholder expectations and standards on ESG matters as they continue to evolve or if we are perceived to have not responded appropriately to concern for ESG issues, regardless of whether there is a regulatory or legal requirement to do so, we may be exposed to the risk of investigation, inquiry, or legal challenges or suffer reputational damage.

At the same time, recent “anti-ESG” political developments could subject the Company to increased risk of criticism or litigation risks from certain “anti-ESG” parties including various government agencies.

Such sentiment may focus on the Company’s environmental or social initiatives, which such anti-ESG parties may assert are unlawful, political or polarizing in nature.

While we may create and publish voluntary disclosures regarding ESG matters from time to time, we could be criticized for the accuracy, adequacy or completeness of the disclosure related to our ESG-related practices and initiatives, commitments and goals, and progress toward those goals.

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Demand for our services is sensitive to oil and gas prices, global oil supply and other factors which impact our customer’s current and future spending levels.

Global oil and gas supply and demand are impacted by several factors including global economic conditions, geopolitical events, widespread public health crises, epidemics and pandemics, and domestic and global inflationary pressures which may reduce the availability of liquidity and credit and, in many cases, reduce demand for our customers’ products.

Global oil and gas supply and demand are impacted by several factors including global economic conditions, geopolitical events, widespread public health crises, and domestic and global inflationary pressures which may reduce the availability of liquidity and credit and, in many cases, reduce demand for our customers’ products.

Disruptions or volatility in these markets could also adversely affect our customers’ decisions to fund ongoing maintenance and new capital projects, resulting in contract cancellations or suspensions, capital project delays, repurposing of infrastructure, and infrastructure closures.

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While we continue our efforts to expand our market presence in the areas of aerospace and defense, renewable energy, construction, chemical processing, manufacturing, power generation, and public infrastructure, among other industries, economic downturns within the oil and gas industry including falling crude oil prices, have resulted in, and could in the future, result in reduced demand for our services.

The price of our outstanding securities may be volatile.

Historically, our quarterly and annual sales and operating results have fluctuated.

We expect fluctuations to continue in the future.

Additionally, the market for our common stock has been and may continue to be thinly traded, and the price of our common stock may be subject to wide fluctuations as a result.

Our revenues are heavily dependent on certain industries.

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The NYSE has several listing requirements set forth in the NYSE Listed Company Manual.

Section 802.01B of the NYSE Listed Company Manual requires that either our average global market capitalization (inclusive of common and preferred equity) or our total shareholders’ equity exceed $50.0 million.

On March 14, 2024, the Company received a written notice (the “Written Notice”) from the NYSE that the Company was not in compliance with the continued listing standards set forth in Rule 802.01B of the NYSE Listed Company Manual because its average global market capitalization over a consecutive 30 trading-day period was less than $50.0 million and, at the same time, its last reported shareholders’ equity was less than $50.0 million.

As required by the NYSE, the Company timely notified the NYSE of its intent to cure the deficiency and restore its compliance with the NYSE continued listing standards.

On April 29, 2024, in accordance with applicable NYSE procedures, the Company submitted a plan (the “Plan”) advising the NYSE of the definitive actions the Company has taken, and is taking, that would bring it into compliance with the minimum global market capitalization listing standard within 12 months of receipt of the Written Notice.

The NYSE accepted the Plan, and the Company’s common stock continued to be listed and traded on the NYSE during the 12-month period beginning March 14, 2024, subject to the Company’s compliance with other NYSE continued listing standards and continued periodic review by the NYSE of the Company’s progress with respect to the Plan.

The Written Notice had no immediate impact on the listing of the Company’s common stock, which continued to trade on the NYSE during the applicable cure period and did not result in a default under the Company’s material debt or other agreements.

The Written Notice had no immediate impact on the

listing of the Company’s common stock, which continued to trade on the NYSE during the applicable cure period and did not result in a default under the Company’s material debt or other agreements.

On March 14, 2025, we received notice from the NYSE that we had regained compliance with the NYSE listing standards.

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If we are unable to list our common stock on an alternate exchange, a delisting of our common stock from the NYSE could negatively impact us by, among other things, reducing the liquidity and market price of our common stock;

reducing the number of investors willing to hold or acquire our common stock, which could negatively impact our ability

to raise equity financing;

reducing the number of investors willing to hold or acquire our common stock, which could negatively impact our ability to raise equity financing;

limiting our ability to issue additional securities or obtain additional financing in the future;

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Our future effective income tax rates could be subject to volatility or adversely affected by our profit levels, changes in our business, reorganization of our business and operating structure, changes in the mix of earnings in countries with differing statutory tax rates, changes in the elections we make or changes in the valuation allowance for deferred tax assets, as well as other factors.

The Organization for Economic Co-operation and Development (the “OECD”), an international association comprised of 38 countries, including the United States, has issued proposals that change long-standing tax principles including on a global minimum tax initiative.

On December 12, 2022, the European Union member states agreed to implement the OECD’s Base Erosion and Profit Shifting (BEPS) 2.0 Pillar Two global corporate minimum tax rate of 15% on companies with revenues over a specific threshold, which was scheduled to go into effect in 2024.

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While it is uncertain whether the U.S.

will enact legislation to adopt the minimum tax directive, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement the minimum tax directive.

will enact legislation to adopt the minimum tax directive, now or in the future, certain countries in which we operate have adopted legislation, and other countries are in the process of introducing legislation to implement the minimum tax directive.

The OECD also issued guidance in January 2026 that exempts U.S.-based multinational entities from the minimum tax initiative, but non-U.S.

jurisdictions must adopt legislation to implement this.

Further, the OECD issued administrative guidance providing transition and safe harbor rules that could delay the impact of the minimum tax directive.

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and other parts of the world that are focused on restricting the emission of greenhouse gases and enhancing greenhouse gas emissions disclosure requirements, including increased fuel efficiency standards, carbon taxes or cap and trade systems, restrictive permitting and incentives for renewable energy.

The adoption of new or more stringent legislation or regulatory programs limiting greenhouse gas emissions from customers, particularly those in refining and petrochemical industries, for whom we provide inspection, repair and maintenance services, or reducing the demand for those customers’ products, could in turn affect demand for our products and services.

maintenance services, or reducing the demand for those customers’ products, could in turn affect demand for our products and services.

Similarly, changing consumer preferences for goods or services relating to alternative sources of energy or emissions reductions and technological advances in fuel economy and energy generation devices or other technological advances could materially affect our customers, which in turn could negatively impact demand for our services and adversely affect our results of operations, financial condition, and liquidity.

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Scientists have concluded that increasing greenhouse gas concentrations in the atmosphere may produce physical effects of climate change, such as increased severity and frequency of storms, droughts, floods and other climate events.

Such climate events have the potential to adversely affect our operations or those of our customers or suppliers, including by damaging our manufacturing facilities, disrupting our supply chain and causing our suppliers to incur significant costs in responding to such impacts, which in turn could have a negative effect on us, including by adversely impacting our results of operations, financial

condition and cash flows.

Such events, if increasing in their severity and frequency, may also adversely affect our ability to insure against the risks associated with such events, thus leading to greater financial risk for us in the conduct of our operations against the backdrop of such events.

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We maintain limited insurance coverage against these and other risks associated with our business.

Our contracts typically require us to name a customer as an additional insured under our insurance policies and indemnify our customers for injury, damage or loss arising out of our presence at our customers’ location, regardless of fault, or the performance of our services and provide for warranties for materials and workmanship.

We maintain a $6.0 million retention for indemnity coverage.

Our contracts typically require us to name a customer as an additional insured under our insurance policies and indemnify our customers for injury, damage or loss and provide for warranties for materials and workmanship.

We have a $1.0 million retention for indemnity coverage, subject to an aggregate annual deductible of $5.0 million that must be satisfied under our liability insurance policies.

This insurance may not protect us against liability for certain events, including events involving pollution, product or professional liability, losses resulting from business interruption or acts of terrorism or damages from our breach of contract.

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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 1A. Risk Factors